Lender required to discuss foreclosure options with homeowner
Reported by Heather McCartney
A homeowner defaulted on his mortgage. The lender recorded a Notice of Default (NOD) commencing foreclosure. The homeowner sought to prevent the trustee’s foreclosure sale, claiming the lender did not fulfill his requirement to contact the homeowner and assess his ability to pay and explore options to avoid foreclosure before filing an NOD. The lender sought to continue with the foreclosure and to hold the trustee’s sale, claiming he had complied with the assess-and-explore requirements. The California court of appeals held the homeowner had the right to enjoin the lender from proceeding with the trustee’s sale until the lender proved he complied with the assess-and-explore rules, since the homeowner disputed the lender’s compliance. [Mabry v. The Superior Court of Orange County (June 4, 2010) ___ CA4th ___]
Editor’s note: This is a Case of First Impression; no previous case has dealt with this issue before, which is extremely rare to come across these days. Expect future foreclosing homeowners to jump on this opportunity, drawing the courts’ attention to, or even falsifying, lender non-compliance with the assess-and-explore rules in order to stall foreclosure proceedings.
Landlord’s right to manage his property lost due to sexual harassment
Reported by Kelli Galippo and Jeffery Marino
A landlord of a residential property sexually harassed one of his tenants while engaging in routine landlord/tenant interactions. The tenant sought to have the landlord’s right to manage property revoked, claiming he breached unfair competition laws. The landlord claimed his right to manage property should not be revoked since the sexual advances he made were merely a matter of personal misconduct and not related to his business practice. A California appeals court held the landlord’s sexual harassment violated unfair competition laws since his sexual advances were made possible by his role as a landlord and occurred during business-related encounters without any prior or existing personal relationship. [The People v. Gabriel (2010) 186 CA4th 882]
Editor’s note—A civil penalty was also imposed on the landlord for sexual harassment.
Also at issue in this case:
Landlord not liable for tenant’s attorney fees
A landlord of a residential property sexually harassed one of his tenants while engaging in routine landlord/tenant interactions. The landlord’s right to manage property was revoked under unfair competition laws and the tenant sought to recover attorney fees from the landlord, claiming her right to recover attorney fees under the unfair competition laws. The landlord claimed he should not be required to pay attorney fees since there is no legal authority under the unfair completion laws requiring him to do so. A California appeals court held the landlord was not responsible for payment of the tenant’s attorney fees since unfair competition laws do not allow for the recovery of attorney fees. [The People v. Gabriel (2010) 186 CA4th 882]
Editor’s note — Unfair competition laws allow for laws to be borrowed in order to base a claim on a previous statute. The tenant in this case claimed attorney fees were recoverable since laws were borrowed from a county statute that allowed for the recovery of attorney fees. The California appeals court held attorney fees were not recoverable in this unfair competition law suit since the borrowing of laws does not imply the borrowing of corresponding remedies.
Closed city sessions are only permitted under “real property exception”
Reported by Heather McCartney
A public agency leased a commercial property to a business owner, and made a loan to the business owner to rehabilitate the leased property. At a public agency meeting regarding the loan, the meeting recessed into closed session with a negotiator retained by the agency to discuss proposed changes to the loan. A local prosecutor sought an opinion from the Attorney General, claiming the public agency could not convene in closed session to discuss a loan owed to the city since a closed meeting is permitted only when discussing the sale or lease of real estate. The Attorney General held the public agency violated the Brown Act by not discussing public matters in a public forum, since the discussion was regarding the terms of the loan and not the purchase, sale, exchange or lease of real estate. [____Ops.Cal.Atty.Gen____(May 25, 2010)]
Demonstration considered trespassing on private property
Reported by Jeffery Marino and Kelli Galippo
The owner of a business located in a shopping center gave permission to various groups to congregate at his storefront to petition and solicit his customers. A labor union began picketing at the storefront after unsuccessful negotiations with the business owner. The business owner asked the union representatives to leave the property. The union representatives refused to leave, claiming the storefront was a public forum where they had a right to peacefully demonstrate since other petitioners had previously been allowed to use the storefront for public solicitation. The property owner sought to have the union representatives removed from the premises, claiming they were trespassing since the storefront was private property and the owner had not granted the union representatives the right to picket in front of the business. A California court of appeals held the business owner had the right to have the union representatives removed since a storefront is private property and may not be used for public purposes without the owner’s permission. [Ralphs Grocery Company v. United Food and Commercial Workers Union Local 8 (2010) 186 CA4th 1078]
Editor’s note — Whether or not the property is a public or private forum plays a vital role in the result of this case. The fact the business owner allowed groups to congregate at his storefront does not set a precedent for the area as a public forum.
Habitat study avoids coastal commission’s 100 foot setback
Reported by Krista Craig and Jeffery Marino
An owner of property located in a coastal zone applied to the county for a permit to build a single family residence (SFR) 50 feet from a wildlife habitat. A biological consulting firm conducted a study of the site and concluded the wildlife habitat would not be damaged as a result of the construction within 50 feet of the habitat. The county then approved the building permit. A neighboring property owner sought to have the permit revoked claiming the county’s issuance of the building permit was in violation of a 100-foot restriction mandated by the coastal commission. The county claimed the approval of the 50-foot setback was permissible since a study showed the construction of the SFR would not harm the wildlife habitat. A California appeals court held the county did not abuse its authority in awarding the permit since the 50-foot reduction of the setback was found to be consistent with the coastal plan as it posed no significant threat to wildlife habitat. [Hines v. California Costal Commission, Board of Supervisors of Sonoma County (2010) 186 CA4th 830]
Editors note— Building permits are only valid if they comply with all relevant laws. It is the builder’s responsibility to see to it a permit complies, not the agency issuing the permit.