SUPERIOR COURT OF CALIFORNIA NORTH CENTRAL DISTRICT - BURBANK
JEFFREY M. HILDRETH and TARYN N. HILDRETH, Plaintiffs, v. CITY OF SIERRA MADRE, a municipal corporation, ELAINE I. AGUILAR, RICHARD C. TEMPLE, ) DANNY CASTRO, WILLIAM LITVAK, CHARLENE J. WYNDER, DAVID J. PASTERNAK, and Does 1- 20, inclusive, Defendants.
Case No. CV12-10339 [Assigned to Hon. William D. Stewart, Dept. A]
Since late 1998, the Hildreths have been engaged in construction of a restaurant and wine cellar at their home (“Property”) in the City of Sierra Madre (“City”). The project was authorized by a series of building permits, a conditional use permit, and residence conversion permit – all issued by the City in 1998-2001. At each step where required, the Hildreths obtained City inspections and approvals of the construction. By June 2009, the Hildreths had invested over $133,000 in materials, supplies and services in the project.
On June 9, 2009, the City’s former Building Official, Richard Temple (“Temple”), who at the time had been in the City’s employ less than six months, halted construction by issuing a stop- work order on the sole ground that there were no building permits in the City’s records for the construction. During the ensuing 18 months, no City representative gave the Hildreths notice of any specific violation at the Property other that a general reference to unspecified violations of the “building code” (which contains 3,044 provisions citable as violations) in an October 2009 letter from the City’s outside counsel. We contend that this notice was constitutionally void for vagueness (e.g., Cranston v. City of Richmond, 40 Cal. 3d 755, 764 (1985)), thereby voiding all subsequent litigation and court orders issued herein.)
For about one year before the City filed the instant complaint, the Hildreths made repeated, and unsuccessful, requests to the City for the specific Code violations it claimed. During heavy rains, threatened mudslides and City-ordered evacuations in Fall 2010, they repeatedly requested that Temple issue a permit for them to erect a deck over the open excavation to protect their neighbors’ property from erosion damage caused by the heavy rains. When he failed to respond, the Hildreths on October 18, 2010 wrote the City Council, (i) advising it that they had erected the deck to protect against rain erosion and (ii) that the City Manager’s administration refused to specify what code violations needed repair, and (iii) accusing the City’s management of corruption analogous to the City of Bell. In retaliation for that constitutional petition and expression of free speech, that City immediately began preparing the papers that led to this litigation.
At no time before filing the complaint did the City give the Hildreths the order or notice to repair violations that is required by Health & Safety Code (“H & S Code”) §§17980.6 and 17980.7(c)(4)(G) or the notice and adequate time to comply with such order that, according to H & S Code §17980(c)(14), are required “by the California ... and the United States Constitution[s].”
At all times from June 9, 2009 and continuing throughout the pendency of the instant case, the Hildreths have been forbidden – by the City’s stop work order and by this court’s injunction – from repairing or abating any alleged violation on the Property.
Without giving notice or issuing any order for abatement, the City on December 1, 2010 served the Hildreths with the instant complaint and a 2-day notice of an ex parte application for TRO, accompanied by over 3 inches of moving papers, pertinent portions of which were illegible. 8. Unknown to the Hildreths any time prior to the October 16, 2012 MSC herein, those moving papers contained declarations and a brief that perpetrated a fraud on the court in that they falsely stated that the City had never issued building permits for the project, thereby rendering the Hildreths’ Property, in its entirety, a building code violation; whereas, five photocopies attached to those declarations, when examined under magnification during the 2012 MSC, depicted the City’s original copies of the Hildreths’ building permits.
The Hildreths could not comprehend the meaning of the papers served on December 1, 2010, had no understanding of legal procedure, had no attorney and could find none to represent them in the single business day before the TRO. Through an acquaintance they contacted a non- municipal law practitioner, Mr. Ciccarelli, delivered the papers to him and persuaded him to informally appear for them. At the TRO hearing, Ciccarelli advised the court that he was appearing pro bono and was not undertaking to represent the Hildreths, after which the court signed the TRO and set a hearing on a preliminary injunction. Through a subsequent misunderstanding between the Hildreths and Ciccarelli – confirmed by Ciccarelli in a C.C.P. §473 attorney-fault declaration – they mistakenly relied on Ciccarelli to review the papers (which remained in his office) and do what needed to be done. As a result, they had filed no Opposition and were completely unprepared for the injunction hearing, at which Ciccarelli did not appear. Mr. Hildreth advised the court of the foregoing misunderstanding and surprise at the outset of the hearing. In the course of the hearing, when the Judge Simpson stated that the crux of the issue was whether the Hildreths had a building permit, counsel for the City falsely represented to the court that the Hildreths had obtained “no permits, no approvals, no inspections.” Thereupon, the court granted the preliminary injunction.
The TRO and ensuing injunction have continued in effect the City’s stop work order in a continuous and unbroken prohibition against the Hildreths performing any work of any kind [including work to abate the alleged violations] so that the Hildreths have been prohibited from abating any alleged code violations at an time since June 9, 2009.
In 29 subparagraphs of paragraph 24 the complaint, the City alleges that various conditions on the Property violate building code provisions. Two of those allegations clearly violate the void for vagueness doctrine - one alleging that the Property violates the “building code”; another, alleging that it is a “public nuisance” (a centuries-old doctrine with hundreds of possible meanings). Twelve other subparagraphs allege that the Hildreths violated the code by doing various kinds of “unpermitted” work – all based on the City’s above-described fraud on the court. As for the remaining alleged violations – as well as the ‘unpermitted’ work – the City failed to give the Hildreths the notices and adequate time to repair the alleged violations that are required by the H & S Code and the Constitution before filing the complaint.
One of said allegations was that the Hildreths constructed the deck described in ¶4 above after being served with the stop work order and that this violated the code. True, however, we believe that the building code then in effect provided that the penalties for such a violation did not apply to “emergency work” where “such work was urgently necessary.” The deck was built in such circumstances.
The City’s conduct since the filing of the complaint is consistent with an intent to harm the Hildreths in retaliation for their October 18, 2010 exercise of the rights of petition and free speech and is inconsistent with a lawful intent to abate real public nuisances. When the Hildreths, at the Court’s urging, attempted to apply for a new building permit, the City responded by refusing even to provide them with an application form. When they applied for a permit to demolish the aforesaid deck, the City denied their application in secret without notice. Between November 2011 and April 2012, the Hildreths on over 14 occasions requested that the City meet with them to discuss new and corrected construction plans that the Hildreths had submitted for City approval. The City refused all but one of those requests.
By failing to provide the Hildreths with the above-cited pre-filing §17980.6 notice of violations, and by failing to provide an opportunity to repair same, the City cut off this court’s power to appoint a receiver (§17980.7(c)), and destroyed the receiver’ s power under §17980.7(c)(4) (C), (D) & (G) to obtain cost estimates for repairs, to employ contractors to make the repairs, to borrow money for said repairs, or to obtain a lien on the Property to secure the receiver’s fees and expenses. I.e., each such power is statutorily contingent on the “notice of violation” required under §17980.6, which notice was never served.
Other than various conclusory allegations in the complaint and moving papers, the City has introduced, and the record contains, no evidence that any condition on the Property in fact threatens the safety, health or convenience of the public. E.g., there is no fire safety risk posed by the City’s claim that a chimney that the Hildreths have not even begun to construct lacks a flame arrester; nor is there any risk from alleged electrical code violations where no electrical lines have been connected to a power source. The court granted the City’s motion to appoint a receiver on the ground that “a structure erected without compliance to the applicable building codes is almost in and of itself a danger to the community.” My research has disclosed only one reported case anywhere in the country where such a contention has been made, and the court rejected that argument.
The City from the outset herein has rested its assertion that the Property is a “public nuisance” on its contention that the mere declaration in its Municipal Code that a violation of the Building Code constitutes a “public nuisance” converts any condition or activity into a “public nuisance,” regardless of whether the condition or activity in fact endangers the public. Were a court order to adopt that argument, investing the City with such arbitrary power, such an order would be unconstitutional under controlling U.S. Supreme Court law. Yates v. City Of Milwaukee, 77 (10 Wall.) U.S. 497, 505 (1871): It is a doctrine not to be tolerated in this country, that a municipal corporation, without ... [showing] a given structure ... to be a nuisance, can, by its mere declaration that it is one [i.e., a nuisance], subject it to removal
Based on the above, the Hildreths contend that from December 3, 2010 through the April 22, 2013 hearing in Pasadena, the City and the Pasadena branch of this court engaged in an ongoing deprivation of the Hildreths’ rights under the federal and state constitutionals and under the H & S Code provisions described above. City of Santa Monica v. Gonzalez (2008) 43 Cal.4th 905, 926 (“Gonzales”), which held:
“[A]n owner of a substandard building [is ensured] procedural due process rights guaranteed by the California Constitution and the United States Constitution, including, but not limited to, receipt of notice of the violation claimed and an adequate and reasonable period of time to comply with any orders which are issued by the enforcement agency or the court.” [Citation.] There is thus no question an owner may contest a section 17980.7 receivership if fair notice of a claimed substandard condition was lacking or if a reasonable opportunity to correct the cited condition was not afforded. (Emphasis added.)
THE PROPOSED AMENDED FEDERAL COURT [Alternatively, State Court] COMPLAINT AGAINST THE RECEIVER FOR VIOLATION OF §1983, FOR BREACH OF FIDUCIARY DUTIES AND OF HIS DUTY OF CANDOR WITH THE COURT, FOR NEGLIGENCE AND GROSS NEGLIGENCE
Unfortunately, the misconduct at issue in this case goes well beyond the above. In the year since the court appointed Receiver David J. Pasternak, it has come to light that Pasternak has engaged in and is engaging in wrongful actions to the Hildreths’ injury. These include various findings and recommendations made in Pasternak’s Proposal, dated October 11, 2012 (“1st Proposal”) and Second Proposal, dated January 23, 2013 (“2d Proposal”). We will very shortly file the above-mentioned Motion for Leave to Sue Receiver Pasternak in the Federal Case, the hearing on which is reserved for September 20, 2013. The reason for the motion is that in the Federal Case, Pasternak has asserted that a party suing a receiver in another court must obtain permission for such suit from the appointing court (this court). We set forth in skeletal summary below the events and issues that our motion will present to this court.
As a preliminary matter, it is necessary that we advise the court that Pasternak prides himself on having been in the practice of receivership matters for 30 years and claims to have been receiver in “hundreds” of cases. He is also to be congratulated for having been in the practice of law for 36 years. He has more than adequate resources, e.g., his law office occupies half a floor of the 1875 Century Park East building, among the highest rentals in Los Angeles. Even more important, he was the receiver in Gonzalez, supra.
Based on the above, Pasternak’s fiduciary duty as receiver herein includes the obligation to apply his wealth of experience and legal knowledge in a competent manner in his participation herein. We will show that his duty of care and competence required and requires that he understand the following at the minimum:
(1) A review of the court file sufficient to understand its contents that, contrary to the mandate of Gonzalez, the Hildreths received no pre-filing notice of the specific code violations and have never been given the opportunity to repair said alleged violations;
(2) The constitutional law doctrine that overbroad government regulations and orders are “void for vagueness;”
(3) The federal case law holding that a public official’s qualified immunity from liability disintegrates when the official enforces an order that is clearly invalid or unconstitutional;
(4) A receiver’s fiduciary duties (i) of strict impartiality; (ii) to preserve – not demolish – the receivership property; (iii) to do only those things that are “strictly necessary” for such preservation and to refrain from acting “extravagantly”; (iv) to be candid with the court and all parties, including full disclosure of all pertinent matters; and (v) to seek the court’s instructions on any doubtful or otherwise appropriate matter;; and
(5) The Supreme Court’s recent adoption of the doctrine of “willful blindness” in federal civil cases. Global-Tech Appliances v. SEB, 131 S. Ct. 2060, 2069-2070 (2011).
Shortly before this court issued the order appointing Pasternak, the Hildreths filed the declarations of three expert witnesses with respect to the appropriate methods and estimated costs of correcting the City’s alleged code violations and a report to the court that the code violations alleged in the complaint can be repaired for an estimated cost of $4,900. Receiver Pasternak’s office has had copies of those documents since before the receiver’s first inspection of the Property on September 18, 2012. In formulating his 1st and 2d Proposals, Pasternak concealed and ignored the findings in those sworn expert declarations.
In preparing and formulating both of his proposals, Pasternak concealed from the court the results of Mr. Lake’s September 18 inspection. Lake, the only representative from Paternak’s office who inspected the site and the person who did nearly all the work on the Proposal, repeatedly admitted to Jeffrey Hildreth and others that Lake’s experts found no substantial violations during their inspection of the Property.
Instead of considering the Hildreths’ sworn evaluations and estimates, Pasternak formulated his 1st Proposal by concealing the above $4,900 estimate and by falsely misrepresenting therein that contractors’ bids to his office for the remediation of the code violations estimated that the work would cost $300,000-400,000. Based on that false representation, Pasternak obtained valuations and formulated a finding that said misrepresented cost exceeded the market value of the Property. This false premise, in turn, led to Pasternak’s conclusion in the 1st Proposal that “rehabilitation of the Property with the structure above the existing hole [the Hildreths’s home] is not an economically prudent course of action." From and after his formulation of the aforesaid false findings and conclusions, all work performed in Pasternak’s office and all matters formulated in the 2d Proposal and thereafter have been devoted to the demolition of the Hildreths’ home and filling the underground area with concrete slurry.
We base that above contention that Pasternak formulated false statements in his 1st Proposal concerning the contractors’ estimates of the work on the following. An expert analysis of the bids on which Pasternak relies: Contrary to the standard practice in Southern California, none of the proposals relied on by Pasternak were prepared by a licensed California contractor, and none were supported by an engineer’s report. The bid from Urban Drywall proposed work on the Property, 96.4% of which was unrelated to the code violations alleged in the complaint. Western Builders submitted two proposals – only the first of which addressed the code violations alleged in the complaint. That proposal is not an estimate of the cost of abatement; in fact, Western expressly admits therein that with respect to the violations alleged by the City, “[t]he potential cost of corrections cannot be accurately estimated without a detailed review.” The second, and completely separate Western proposal is to construct an entirely new “basement” at a cost of approximately $390,000. The latter proposal is not an estimate of the cost to abate the violations alleged in the complaint.
Given the above, most importantly Mr. Lake’s admissions to Jeffrey Hildreth, we contend that the concealment of the various facts and the misinterpretation of the Urban Drywall and West Builders’ bids exhibit a prima facie case of “willful blindness” on Pasternak’s part.
The foregoing events support the Hildreths’ further contention that Pasternak has breached his fiduciary duty of strict impartiality. We base that claim on the following: The Hildreths and their counsel have personally observed (a) repeated open displays of close friendship between Pasternak and the City’s lead attorney herein, William Litvak and (b) repeated ex parte discussions among Pasternak, Litvak and sometimes Charlene Wynder in circumstances that warrant a reasonable inference that the discussions concerned trial strategy herein. When I attempted to join one such conversation, in the corridor of the court on February 19, 2012, Litvak angrily told me to leave the vicinity.
I have repeatedly requested in writing that Pasternak make disclosures of all records of ex parte communications concerning this case between him and Litvak, and all records of fees generated for Pasternak as a result of Litvak’s nominations of Pasternak as receiver in this and other cases. Pasternak has refused to make any such disclosures. As a result, I conducted my own search of case records limited to Los Angeles Superior Court and found that in the past 36 months Pasternak has obtained or has invoices pending with courts in the aggregate of over $500,000 in fees and expenses for work in cases in which Litvak recommended him as receiver.
Based on the foregoing, commencing on March 12, 2013 I have written a series of letters and emails to Pasternak and, later, to his attorney in the Federal Case, stating or requesting the following:
(a) I have repeatedly informed Pasternak in writing that – at least on some occasions – he “performs judicial functions” within the meaning of Canon 6A (definition of “judge”) of the California Code of Judicial Ethics.
(b) I requested that Pasternak disclose the above ex parte communications with Litvak and Litvak-generated receiver fees and costs.
(c) I asked that Pasternak recuse himself as receiver herein based on the above-describe conduct, much of which consists of per se judicial improprieties. The recusal request is warranted by the Advisory Committee’s interpretation of Canon 2A of the Code – i.e., recusal is required whenever “a person aware of the facts might reasonably entertain a doubt that the judge would be able to act with integrity, impartiality, and competence.”
(d) I have asked Pasternak to seek formal instructions from the court with respect to his duties under the Judicial Ethics Code.
Pasternak has never responded to the above requests. However, he has stated in a sworn declaration and on the record in open court before Judge Simpson that he “is not a judge,” that he “makes no decision,” that he only makes “recommendations” to the court, and that in 30 years no one has ever contended that he is subject to the Code of Judicial Ethics.
Pasternak’s above refusals to disclose indicate that Pasternak has something to hide that will come out on the record if he makes the disclosures.
Pasternak’s statements about his not being a judge and making only “recommendations” – under the federal case law that applies to the §1983 case in federal court – deprive him of the “absolute judicial immunity” that he has claimed he has as to the §1983 claim. We anticipate that he will make the same claim with regard to the damage claims for his breaches of fiduciary duties under state law. We will show in our motion that Pasternak has no immunity whatsoever for any of his actions from and after the 1st Proposal because since then he has been working based on proposals the do not relate to the code violations alleged in the complaint. His work on non- code-violation matters also deprives him of his fees and expenses under both state and federal case law.
Finally, Pasternak’s wealth of experience and seniority and success in the practice of law preclude him from claiming “qualified immunity” as a court officer because he is charged with the knowledge that this court’s order appointing him is clearly invalid under the California and U.S. Constitutions and under the rationale of Gonzales in his he, Pasternak, was the receiver. Furthermore, to the extent that he claims immunity for enforcing or complying with the August 31, 2012 order, the federal case law holds that the protection from enforcement of court orders does not apply to the manner in which the officer enforces the order.
Respectfully submitted, DATED: August 16, 2013 DAVID E. ROSENBAUM Attorney for the Hildreths