APPEALS COURT UPHOLDS RECEIVERSHIP AND DEMOLITION OF LOCAL APARTMENT BUILDING
June 7, 2006
The Second District Court of Appeal has upheld the appointment of a receiver who took over control of a Santa Monica apartment building after the owner refused for many years to bring the property up to code. The Appellate Court also affirmed a court order to allow the demolition of the building.
In January 2005, Judge Lisa Hart Cole of the Beverly Hills Superior Court had appointed a receiver to take control of the property located at 2438 Ocean Park Boulevard, which consists of three units. One of the units is occupied by the building owner, Guillermo Gonzalez. The court found that the property was in a chronic state of disrepair and had become a dangerous blight to the community.
The Consumer Protection Unit of the Santa Monica City Attorney’s Office filed the case on behalf of the city in December 2004.
The health and safety code violations at the property included:
The city had received numerous complaints about the property from neighbors. Twice in the past decade the City Attorney’s Office had filed criminal charges against Gonzalez to compel him to bring the building up to code. Both times Gonzalez was convicted, but he nonetheless refused to make the repairs. In both cases he served time in Los Angeles County Jail for his refusals.
The Consumer Protection Unit finally sought a court-appointed receiver as a last resort to assure that the property be made safe and legal.
The receiver, Century City-based attorney David Pasternak, assumed full control of the property in January 2005. In May 2005 he requested court permission to demolish the building in light of the facts that it was financially not viable to rehabilitate the property, and the property would be worth considerably more with the building gone. The court granted his request.
Gonzalez appealed from the appointment of the receiver as well as the order allowing the demolition. He argued to the appellate court that the City had not complied with certain technical requirements of the receivership law; and that demolition would be unfair since he wished to remain living in the building and preferred to pay the cost of repairs instead.
The Court of Appeal, in its written decision last week, ruled that the receivership was proper. Any technical deviations from the statute by the City did not prejudice Gonzalez since he had ample notice of the violations, the court noted. The court also held that it was reasonable to allow the demolition of the building since rehabilitation was not economically feasible. The court noted that trial courts have broad discretion in appointing receivers and overseeing their actions in managing properties.
“Apartment owners need to know that their buildings can be taken away if they refuse to follow the law,” said Deputy City Attorney Adam Radinsky who is handling the case for Santa Monica. “They must correct code violations within a reasonable time. Receivership is drastic medicine, but we won’t hesitate to use it in proper cases to protect the well-being of the community.”
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