Judge Kenny’s ruling in Petrovich Development Company, LLC v. City of Sacramento et al.

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SUPERIOR COURT OF CALIFORNIA

COUNTY OF SACRAMENTO

PETROVICH DEVELOPMENT COMPANY, LLC ,
a California limited liability company;
PDC CONSTRUCTION, CO., INC.,
a California corporation; and
CALVINE & ELK GROVE-FLORIN, LLC ,
a California limited liability company,

Petitioners/Plaintiffs,

v.

CITY OF SACRAMENTO,
a California municipal corporation;
MAYOR AND CITY COUNCIL OF THE CITY OF SACRAMENTO;
and DOES 1-100,

Respondents/Defendants,

ERIC JOHNSON, ANDREA ROSEN, SIERRA CURTIS NEIGHBORHOOD ASSOCIATION, and ROES 1-100,

Real Parties In Interest.

Case No. 34-2016-80002289-CU-WM-GDS

RULING ON SUBMITTED MATTER: PETITION FOR WRIT OF MANDATE AND FOR DECLARATORY AND INJUNCTIVE RELIEF, MOTION TO STRIKE AND OBJECTIONS TO EXTRA RECORD EVIDENCE

This matter came on regularly for hearing on December 15, 2017. The parties appeared and presented oral argument, after which the Court took the matter under submission. The Court now issues its ruling on submitted matter.

MOTION TO STRIKE/EVIDENTIARY OBJECTIONS

Respondents have filed a motion seeking to strike evidence submitted by Petitioners, or in the alternative specific evidentiary objections. Petitioners have filed an opposition. The Court has reviewed the declarations and the arguments presented by the parties.

With regard to the Petrovich declarations, the Court SUSTAINS Respondent’s evidentiary objections 1-58.

With regard to the Heede declaration, the Court will consider Exhibit B. Accordingly, the Court SUSTAINS Respondents’ evidentiary objections 59-63, and 65-70. Evidentiary objection 64 is OVERRULED.

With regard to the Earl declaration, the Court SUSTAINS Respondents’ evidentiary objections 72, 76, 78-83. Evidentiary objections 71, 73-75, and 77 are OVERRULED.

With regard to the Smith declaration, the Court SUSTAINS Respondents’ evidentiary objections 84-87. 15 With regard to the Cox declaration, the Court SUSTAINS Respondents’ evidentiary 17 objections 93, 94, 98-104, 105 (as to subdivision (a) only), 109-112, 115-117. Evidentiary objections 89-92, 95-97, 105 (as to all remaining subdivisions), 106-108, and 113-114 are OVERRULED.

With regard to the Supplemental Cox declaration, the Court SUSTAINS Respondents’ evidentiary objections 118-130. Evidentiary objection 131 is OVERRULED. (The Court notes, having reviewed all of the proffered evidence, even if the Court were to sustain or overrule all 28 evidentiary objections, its decision on the merits of this matter would not change.)

PETITION FOR WRIT OF MANDATE AND FOR DECLARATION AND INJUNCTIVE RELIEF

I. Introduction

This matter involves a challenge to the City’s decision denying a Conditional Use Permit (hereinafter, “CUP”) for a proposed gas station at Curtis Park Village (hereinafter, the “Project”). The matter also involves claims that the Council “failed to provide a fair and impartial ‘quasi adjudicatory’ hearing on the CUP as required by law, and improperly allowed its decision-making process to be tainted by personal animus and bias, and by inadmissible influences and communications outside the public record.”

II. Background

In 2010, the City approved and certified an Environmental Impact Report for the Project (See AR, 8-10.) The Project is located at Sutterville and Crocker Roads, and consists of approximately 72 acres, including single-family homes, multi-family housing, a park, and 260,000 square feet of retail and commercial uses. (AR, 221.) The subject area, including surrounding neighborhood is commonly referred to as Curtis Park. (AR, 220.) Petitioners in this matter are the owners of the subject property and developers of the Project.

In 2014, Petitioners negotiated with Safeway about becoming an “anchor” in the 20 commercial/retail portion of the Project. (AR, 18577.) Safeway indicated that such participation was contingent on building “fuel premises.” (AR 18576.) As the original site plan did not include a gas station, Petitioners were required to apply for a CUP. (AR, 4442, 4606.) Petitioners accordingly applied to construct a 16-pump gas station with canopy and convenience store as a component of the larger shopping center. (AR 4606.)

In advance of a June 11, 2015 hearing, staff prepared a “Report to Planning and Design Commission” regarding the “request to construct and operate a new gas station on .46 acres in the Shopping Center (SC-PUD) Zone in the Curtis Park Village Planned Unit Development.” (AR, 2 3 15 4603.) The staff recommendation stated,

“Staff recommends the Planning and Design Commission approve the requested entitlements with the findings of fact and conditions of approval provided in Attachment 1. The Commission has final approval and authority over items A through D above. The Commission’s decision can be appealed to the City Council. This item is considered to be controversial. Staff has received comments on this project related to traffic, health related impacts, consistency with the General Plan and the Curtis Park Village PUD, and aesthetics.” (AR 4603)(emphasis in original.)

On June 11, 2015, the Planning Commission voted 8-3 to approve the Curtis Park Fuel Center CUP and Site Plan and Design Review. (AR, 5238.) On June 19, 2015, the Sierra Curtis Neighborhood Association, Eric Johnson, and Andrea Rosen (hereinafter, collectively “Real Parties”) filed an application to appeal the decision premised on five concems:

1. Approval of the Project is “detrimental to the public health, safety, convenience or welfare of persons residing, working, visiting or recreating in the surrounding 14 neighborhood.”
2. The proposed Fuel Center is fundamentally inconsistent with the Curtis Park Village Development Guidelines (P04-109) adopted by the City Council in 2010 and which Ig have the force of law.
3. The City’s reliance on a CEQA Addendum is legally deficient. 17
4. The CEQA Addendum itself is legally deficient.
5. The City’s approval of the Project would violate CEQA. (AR, 5948-5951.)

Ultimately, on November 17, 2015, the City Council heard Real Parties’ appeal. (AR, 2Q 6045.) Councilmember Schenirer spoke after the time for public comments, and concluded,

“… I just can’t support in any way, shape or form putting a gas station that close to a residential area, and frankly if we never have a new gas station again I would be okay with that, I would be okay with that.. .1 want to move that we reject the staff recommendation [sic] that we deny the conditional use permit to construct and operate a gas station in the shopping center zone [sic] in the shopping center zone in the Curtis Park Village Planned use development.” (AR, 5414-5415.)

The City Council voted 7-2 in favor of Councilmember Schenirer’s motion. (AR, 5511.)

(The Court recognizes there are significant events that occurred between the parties subsequent to the filing of the appeal and the hearing of the issue at the City Council meeting. The Court will not summarize these events here, but 28 will include them in its analysis of the claims to the extent those events are relevant. )

During the hearing, when questioned about findings of fact to support the decision, a male voice provided that, (The Court cannot identify the speaker, as the transcript only says “Male Voice 3.” The person speaking was in response to the mayor’s question of the attorney” However, the Court cannot confirm that the responding party was the City Attorney based solely on the record.)

“.. .there is enough of a record established to make the findings necessary if the council’s inclined to vote to deny it. The findings would include issues associated with the consistency of the applicable plans, the transit-oriented development, the issues related to the safety and health, consistency with the location of the gas station, there [sic] a number of issues that have been already put on the record, so from a land use standpoint, there is a record available for the council.” (AR, 5509.)

Via “DRAFT Minutes” the City provided that it rejected the CUP based on the following findings,

“The proposed gas station and its operating characteristics are not consistent 11 with the General Plan policy 5.1.5 discouraging low-intensity and auto oriented uses around transit stations in that.. .the gas station is within a 1/4 mile radius of an existing City College Light Rail Station…in the City Council’s view, interference with access to transit is not the only point of this policy in this instance, and this larger size gas station required extra consideration… vehicle miles travelled is still an issue to address… An auto oriented use around the transit station, which would be draw for additional traffic and trips from outside the surrounding community is counter to that policy and is not consistent with this policy to discourage auto oriented uses. The City’s application for grant funding to build the pedestrian bridge connecting the project to nearby light rail called the Curtis Park Village a high density, mixed-use urban infill development project which embraced the blueprint developed by SACOG. The gas station is inconsistent with City’s overall goals and objectives for infill and sustainability, climate action, transit  oriented development, the regional blueprint, and the objectives of General Plan Policy 5.1.5.

d. The proposed use and its operating characteristics are detrimental to the convenience and welfare of persons residing, working, visiting, or recreating in the surrounding neighborhood as the large scale of the gas station is 21 incompatible with the surrounding neighborhood, and it would increase traffic.” (AR, 5257-5258.)

Petitioners subsequently filed this matter, challenging the CUP denial.

III. Standard

The instant petition’s challenge to the City Council’s decision is pursuant to Code of Civil Procedure section 1094.5. A writ will issue if the Court finds a prejudicial abuse of discretion, which is established if the respondent “has not proceeded in the manner required by law, the order or decision is not supported by the findings, or the findings are not supported by the evidence.” (Cal. Code of Civ. Pro. § 1094.5(b).) Where it is claimed that the findings are not supported by the evidence (and where, such as here independent judgment does not apply), abuse of discretion is established if the court determines that the findings are not supported by substantial evidence in light of the whole record. (Id. at subd. (c).)

When a party raises allegations of a failure to provide a fair administrative hearing, “the petitioner is entitled to an independent judicial determination of the issue… the court renders its independent judgment on the basis of the administrative record plus such additional evidence as may be admitted…” {Pomona Valley Hosp. Med. Ctr. v. Superior Court (1997) 55 Cal.App.4th 16 93, 101.)

IV. Discussion

A. Requests for Judicial Notice

Petitioners ‘ request in support of “new opening trial brief”

Petitioners have filed a request for judicial notice regarding seven documents. The Court has reviewed the subject documents and finds exhibits A-1, A-2, A-3, B-1, and B-2 are not relevant. Accordingly, the request for judicial notice as to those documents is DENIED. With regard to Exhibits C and D, the request is GRANTED.”

The Court notes there are two tabs marked “exhibit c” on Petitioners’ request. The first “Exhibit C” is a copy of an  email that appears to have been submitted as part of the request in error. For clarity, the Court specifies that judicial notice is not granted as to this email, but is instead granted as to the “Exhibit C” that contains a copy of Sacramento 28 City Code section 17.216.510(B).

Petitioners’ request in support of reply 

Petitioners have filed a request for judicial notice concerning two sections of the Sacramento City Code. They made this request in connection with the reply brief. It is not generally appropriate for a party to request the Court consider evidence for the first time in connection with a reply, and accordingly the request for judicial notice is DENIED.

Petitioners’ request filed at the hearing on this matter

Petitioners also filed a request for judicial notice concerning one document at the hearing 9 on this matter. The request for judicial notice is DENIED.

B. Fair hearing

Petitioners first contend the CUP denial must be reversed because the Council failed to provide a fair hearing. Specifically, Petitioners maintain Councilmember Schenirer engaged in “out of public view” activities to deny the CUP and should have recused himself from participating in the subject vote.

“Procedural due process in the administrative setting requires that the hearing be 17 conducted before a reasonably impartial, noninvolved reviewer.” (Nasha v. City of Los Angeles 18 (2004) 125 Cal.App.4th 470, 483)(citations omitted.) “It is recognized that administrative decision makers are drawn from the community at large. Especially in a small town setting they are likely to have knowledge of and contact or dealings with parties to the proceeding. Holding them to the same standard as judges, without a showing of actual bias or the probability of actual bias, may discourage persons willing to serve and may deprive the administrative process of capable decision makers.” (Id.)(citations omitted.) Consequently, to prevail on a claim of bias petitioners must establish an “unacceptable probability of actual bias” to be proven with “concrete facts.” (Id.) Bias cannot be implied. (Id.)(finding bias proven when a decisionmaker wrote an article hostile to a project before deciding the appeal of the project’s approval.)

1 Participation of a biased decisionmaker is sufficient to invalidate the decision. (Woody’s Group, Inc. v. City of Newport Beach (2015) 233 Cal.App.4th 1012, 1022.) In Woody’s, a city councilmember appealed a planning commission’s decision, and then participated in the vote granting the appeal. (Id. at 1017-18.) On appeal, the Court found it was improper for the city councilmember to have participated, finding the notice of appeal showed the councilmember was “strongly opposed to the planning commission’s decision on Woody’s application. That is, as in 8 Nasha, he took ‘a position against the project.'” (Id. at 1022-23)(citations omitted.)

In voting on approval or rejection of the CUP, the city council was acting in a quasi adjudicatory manner. Accordingly, it was incumbent upon each member to remain unbiased and open to all points of view at the November 17, 2015 hearing. The Court recognizes that politics can be messy; and that politicians must necessarily be active participants on behalf of those they represent. However, especially in a quasi-adjudicatory setting, presenting the public with an unbiased panel of decisionmakers is crucial 16 The evidence concerning Councilmember Schenirer’s bias and involvement with the Project can be summarized as follows

1. In the 1990s, prior to running for elected office, Councilmember Schenirer became a lifetime member of the SCNA via payment of a $25 fee.
2. In 1991, Councilmember Schenirer was a SCNA board member
3. The relationship between Petitioners and Councilmember Schenirer during discussions of the Project changed over time from one characterized as cooperative to one described as strained.
4. Councilmember Schenirer communicated via text messages with Eric Johnson, president ofthe SCNA, conceming the CUP appeal.
   1. On October 7, 2015, Councilmember Schenirer texted “CUP appeal still in play.” (AR, 29969.)
   2. On November 1, 2015, Councilmember Schenirer texted “Can you get together tomorrow night at 7. [sic] I’d like to put a few heads together to talk thm cpv. Thinking you, McKeevers [sic], Tina, joe [sic] and myself. Others?” (AR 9 29970.)
   3. On November 9, 2015, Councilmember Schenirer texted, “Are you all planning any visits to council members? If so, I have suggestions.” Eric Johnson replied “Suggest away!” Councilmember Schenirer responded “I’ll call you later.” (AR, 29971.) Then, on November 12 and November 13, Eric Johnson sent identical emails to Councilmember Harris, Councilmember Warren, and Councilmember Jennings concerning the Project fuel station. The emails are similar to the November 10 “Talking Points” and November 17 Whyte “Talking Points” discussed below.
   4. On November 15, and then November 17, Councilmember Schenirer and Eric 20 Johnson texted conceming how the hearing would proceed. Eric Johnson texted, “Will pdc speak first on Tuesday, or us?” Councilmember Schenirer responded, “You. First staff then you then pdc.” Then followed two days later 24 with, “FYI. Just found out Paul will go before you. Probably good to be able to respond.” (AR, 29971.)
5. On November 10, 2015, Councilmember Schenirer sent an email titled “Curtis Park Village Talking Points” to the mayor, and cc’d Scott Whyte and Joe Devlin. (AR, 1 29988.) The email provided a background of the gas station’s involvement in the Project, and concluded “Bottom line – want to help Safeway be successful. Can we do this without the fuel center, [sic] All entitlements are present and construction could start immediately.” (AR, 29988.)
6. On November 17, 2015 a member of the mayor’s staff, Scott Whyte, sent an email to himself with an attachment titled “Council Comments Talking Points.” (AR, 18905.) The document included a section titled “Sequencing” and indicates, with regard to the Project, “JS punches up to make motion, Hansen seconds: I move to reject the staff recommendation and to deny the conditional use permit for the Curtis Park fuel center.” (AR, 18906)(emphasis in original.) The document then goes on to list “talking points” about the Project. These “talking points” are very similar to those identified in Councilmember Schenirer’s November 10, 2015 email.
7. At the subject city council meeting, Councilmember Schenirer made a motion to reject the staff recommendation and deny the CUP, and Councilmember Hansen seconded the motion. (AR, 5415.)

Respondents assert Councilmember Schenirer’s pre-hearing activities do not rise to the level of “concrete facts” demonstrating bias. The Court disagrees.

While Petitioners rely heavily on Councilmember Schenirer’s membership in SCNA, membership alone is not evidence of bias. (See Independent Roofing Contractors v. California Apprenticeship Council (2003) 114 Cal.App.4th 1330, 1334)(holding the inclusion of officials on a council who are members of a group that filed administrative briefing does not of itself establish sufficient bias to disqualify them.) With regard to Councilmember Schenirer’s mere association with SCNA members, Petitioners do not cite to any authority that such association or friendship is concrete evidence of bias. (While there is evidence that Councilmember Schenirer authored articles for the SCNA newsletter, Petitioners have not identified any evidence that these articles were hostile to the CUP as in Nasha.) (See also Fairfield v. Superior Court of Solano County 3 (1975))(noting a Councilmember has an obligation to discuss issues of concern with constituents.)

The same is true for the November 10, 2015 “Talking Points” email to the mayor’s office. While background facts in support of the CUP are not discussed, Councilmember Schenirer does not indicate that he is against the gas station or that he has predetermined his vote on the CUP. He concludes, “Bottom line – want to help Safeway be successful. Can we do this without the fuel center, [sic] All entitlements are present and construction could start immediately.” While the document is suggestive that Councilmember Schenirer was considering voting “no” on the CUP, it falls short of being “concrete facts” demonstrating “unacceptable probability of actual bias.” With regard to the Scott Whyte email, there is no evidence that Councilmember Schenirer was involved in the creation of this document or ever saw this document prior to the subject vote. There is also no evidence that the document was circulated among the other Councilmembers. The only evidence before the Court is that Scott Whyte sent an email to himself that contains an outline of how the vote ultimately proceeded. While suspicious, the Court finds this again falls short of “concrete facts” demonstrating “unacceptable probability of actual bias.”

However, when considering the facts before the Court as a whole, as it must do, the Court finds Councilmember Schenirer, in the days before the November 17, 2015 hearing, demonstrated an unacceptable probability of actual bias. As the Court has stated, it does not find that membership in the SCNA and regular meetings with SCNA members to be sufficient evidence of bias; however, Councilmember Schenirer’s authoring a “Talking Points” memorandum that suggests he intends to vote “no” on the CUP, and his multiple text message exchanges with Eric Johnson, SCNA president, go beyond mere exchanges of information with a constituent. Instead, such activities suggest Councilmember Schenirer began coaching Eric Johnson on how to prosecute the SCNA appeal. The message, “Are you all planning any visits to council members? If so, I have suggestions,” (followed by a text arranging for a later time to talk) clearly reflects direction from Councilmember Schenirer on what to say and/or who to visit in the Real Parties’ efforts to convince Councilmembers to vote no on the CUP. Further, the emails sent from Eric Johnson to Councilmembers bear a remarkable resemblance to the “Talking Points” document authored by Councilmember Schenirer. (The Court recognizes that the argument can be made that the emails are only similar to the Talking Points because those are the issues the neighborhood and city council were concerned about in voting on the CUP. However, the Court finds that the similarity, coupled with the communications between SCNA members and Councilmember Schenirer demonstrates an unacceptable probability of actual bias. ) These actions go beyond mere membership in an organization (Independent Roofing Contractors) and instead are akin to advocating on behalf of an appellant (Woody’s.)

The Court cannot ignore evidence that, in the days preceding the hearing, Councilmember Schenirer was no longer a neutral, unbiased decision maker. As the Court has explained, the interactions with Eric Johnson demonstrate the concrete facts necessary to establish bias. Accordingly, Councilmember Schenirer should have recused himself from the vote on the Project’s CUP, and his failure to do so was a failure to proceed in the manner required by law.

V. Conclusion

The petition for writ of mandate is granted. (In light of this mling, the complaint for declaratory and injunctive relief is denied.) A writ shall issue directing Respondents to rescind the decision entered on the Real Parties’ appeal of the Project’s CUP via the November 17, 2015 hearing. The writ shall further direct Respondents to hold a new hearing on the Project’s CUP. Pursuant to Nasha and Woody’s, the writ shall direct Councilmember Schenirer to recuse himself from participating in the new hearing. (In Nasha the Court directed the new hearing needed to take place before an impartial panel. In Woody’s the Court noted that if the case had involved bias alone, the Court would remand for a new hearing, “sans Henn.” )

The Court finds Petitioners have not demonstrated bias by the other city Councilmembers sufficient to find that remanding this matter back to the city council would result in an unfair and biased hearing. As the Court has vacated the subject CUP denial vote, the Court will not address the parties’ arguments as to whether the reasons given for the subject vote were supported by substantial evidence or otherwise insufficient.

Respondents shall make and file a return within 60 days after issuance of the writ, setting forth what has been done to comply therewith.

Counsel for Petitioners shall prepare an order incorporating this ruling as an exhibit to the order, a judgment, and a writ; counsel for Respondents shall receive a copy for approval as to form in accordance with Rule of Court 3.1312(a); and thereafter submit it to the Court for signature and entry in accordance with Rule of Court 3.1312(b). DATED: January 3, 2018

Judge MICHAEL P. KENNY
Superior Court of California,
County of Sacramento