HomeMy WebLinkAboutItem 3 - additional materialsK ashani-Sturges Supplemental Arguments in Suppor t of Appeal.
1.Appellants argue that the Administrative Appeals Board enforcement of a per manent
“ineligibility to operate a Vacation Rental in the City of Palm Spring’s”pursuant to
The City of Palm Spring’s Municipal Code 5.25.090(c),constitutes a due process
violation.
According to The City of Palm Spring’s Municipal Code (“PSMC”)section 5.25.040(a),
“individuals operating a Vacation Rental without a Vacation Rental Registration Certificate are
subject to permanent ineligibility to operate a Vacation Rental in the City of Palm Springs,and
administrative fine of $5000.00 on the first violation of the PSMC section 5.225.090(c).Here,the
imposition of banning Appellants,or making them permanently ineligible from ever operating a
Short-Ter m Vacation Rental at the subject property,constitutes a violation of Appellants due
process.Appellants base their due process challenge on Hale v.Mor gan (1978)22 Cal.3d 388,149
Cal.Rptr.375,584 P.2d 512 (Hale ), where our Supreme Court held a utilities-disr uption penalty in
for mer Civil Code section 789.3 (section 789.3)unconstitutional as applied to impose a $17,300
penalty on a trailer park who had tried to evict a tenant by cutting off his water and electrical
ser vice. The statute in Hale punished a landlord's willful act of tr ying to ter minate a tenancy by
interr upting utility service and,like the Housing Code provision here,fixed a threshold amount
($100)for each day of violation or continued disr uption,without any outside limit or discretion to
tailor the penalty to the wrongdoing.Unlike the provision here,the statute placed the right to sue
with the tenant,not the government entity,and provided that the tenant would recover actual
damages plus all of the $100–a–day penalties. (Hale,supra, 22 Cal.3d at p.393,149 Cal.Rptr.375,584
P.2d 512.)
The court in Hale addressed the due process guarantee of the state and federal Constitutions
that exercises of police power be “procedurally fair and reasonably related to a proper legislative
goal....” (Hale,supra, 22 Cal.3d at p.398,149 Cal.Rptr.375,584 P.2d 512.) It honored the state's
police power to impose penalties to ensure prompt obedience to its regulatory requirements and
noted that “[i]mposition of civil penalties has,increasingly in modern times,become a means by
which legislatures implement statutor y policy.” (Ibid.)But the penalty under for mer section
789.3 was held potentially unconstitutional “in certain situations”because it was mandatory in
amount and potentially unlimited in duration (Kinney,supra, 27 Cal.3d at p.352,165 Cal.Rptr.787,
612 P.2d 877), “[t]he exercise of a reasoned discretion [having been]replaced by an adding
machine” (Hale,supra, 22 Cal.3d at p.402,149 Cal.Rptr.375,584 P.2d 512). The law required a
unifor m penalty “even though the statute applied to a broad spectr um of culpable conduct with an
equally divergent range of resulting injury” (Kinney,supra, 27 Cal.3d at p.352,165 Cal.Rptr.787,612
P.2d 877). Landlords and tenants might “var y significantly in sophistication and financial strength,”
and the law's structure of rewarding tenants with the penalties could allow a shrewd tenant,“through
inaction,[to]convert ‘the single wrongful act of [the landlord]into a veritable financial bonanza.’
” (Id. at pp.352–353,165 Cal.Rptr.787,612 P.2d 877, quoting Hale,supra, 22 Cal.3d at p.403,149
Cal.Rptr.375,584 P.2d 512,first bracket added.)The penalty was also “potentially more severe than
that provided by the Legislature for other more serious transg ressions by the landlord against the
tenant,”and thus a penalty could lack conformity with “the Legislature's own perception of the
nature of the underlying offenses and of the remedies and appropriate sanctions necessar y to
achieve and preser ve equitable landlord-tenant relations.” (Hale,supra, 22 Cal.3d at p.400,149
Cal.Rptr.375,584 P.2d 512.) Thus not all applications of the statute would be constitutional.It was
necessary to “evaluate the propriety of the sanction on a case-by-case basis,”mindful that it would
be “upheld unless its unconstitutionality ‘clearly,positively and unmistakably appears.’
[Citations.]” (Id. at p.404,149 Cal.Rptr.375,584 P.2d 512.)
Consequently,the $17,300 penalty in Hale was held unconstitutional.In this matter,however,
Appellants are amenable to paying the $5000.00 fine for their violation of the City’s ordinance.
However,Appellants contend that banning Appellants,or making them ineligible,from ever from
ever operating a Short-Ter m Vacation Rental at the subject property,for a first-time violation,
constitutes a violation of Appellants’due process.For Appellant Sherie Sturges,who is retired and
an “elder”(over the age of 65),the lifetime ban is particularly eg regious since she invested her
retirement money into the subject property for the sole purpose of using it as an investment
property to generate income.
Consequently,the Appellants contend that the “permanent ineligibility”aspect of PMSC 5.25.090(c),
is unconstitutional.
2.Appellants argue that the Administrative Appeals Board enforcement of a per manent
“ineligibility to operate a Vacation Rental in the City of Palm Spring’s”pursuant to
The City of Palm Spring’s Municipal Code 5.25.090(c),constitutes an excessive fine.
Appellants contend that the Municipal Code “permanent ineligibility”penalty,violates the
excessive fines clauses of the federal and state Constitutions.(U.S.Const.,8th Amend; Cal.Const.,
art.I,§17.)They rely mainly on cases constr uing the federal clause,conceding that the state
provision “imposes an essentially identical restriction....”
“The touchstone of the constitutional inquiry under the Excessive Fines Clause is the principle
of proportionality:The amount of the forfeiture must bear some relationship to the g ravity of the
offense that it is designed to punish....[A]punitive forfeiture violates the Excessive Fines Clause if it
is grossly disproportional to the gravity of a defendant's offense.” (Bajakajian,supra, 524 U.S.at p.
334,118 S.Ct.2028.)
Bajakajian adopted a gr oss disproportionality standard articulated in Cruel and Unusual Punishments
Clause precedent to hold that a reviewing court “must compare the amount of the forfeiture to the
gravity of the defendant's offense.If the amount of the forfeiture is grossly disproportional to the
gravity of the defendant's offense,it is unconstitutional.” (Id. at pp.336–337,118 S.Ct.2028.) The
court assessed disproportionality by examining the nature of the crime (willful failure to report the
removal of cur rency from the countr y)and its criminal punishment,the har m the defendant had
caused,and other penalties for like offenses. (Id. at pp.337–339,118 S.Ct.2028.) The forfeiture in
that case—the entire $357,144 the defendant had been car r ying through an airport—was held
grossly disproportionate.Parenthetically,the court noted that the defendant had not urged that “his
wealth or income [were]relevant to the proportionality deter mination or that full forfeiture would
deprive him of his livelihood.” (Id. at p.340,fn.15,118 S.Ct.2028.) Other authority has since held,
and we agree,that “in the case of fines,as opposed to forfeitures,the defendant's ability to pay is a
factor under the Excessive Fines Clause.”(U.S .v.Lippert (8th Cir.1998)148 F.3d 974,978.)
“‘Proportionality is likely to be the most important issue in a forfeiture case,since the
claimant-defendant is able to pay by forfeiting the disputed asset.In imposing a fine,on the other
hand,ability to pay becomes a critical factor.’....” (People ex r el. State Air Resources Bd.v.W ilmshurst,
supra, 68 Cal.App.4th at p.1350,81 Cal.Rptr.2d 221, quoting U.S .v.Hines (8th Cir.1996)88 F.3d 661,
664.)
Here,Appellants are not contending that they are unable to pay the $5000.00 fine or penalty.
Rather,Appellants contend that the “per manent ineligibility”provision of code section itself is
disproportionate to the crime or violation at issue.This rationale was mirrored in City &Cty.of S .F.
v.Sainez,(Sainez)77 Cal.App.4th 1302,92 Cal.Rptr.2d 418 (2000).In Sainez,the Court applied the
Excessive Fines Clause analysis to deter mine whether a violation of the Housing Code enacted by
the City of San Francisco violated due process or constituted an excessive fine.
In applying its analysis,the Court in Sainez acknowledged that while the federal high court
has conducted this analysis in the context of forfeiture laws-where property is forfeited for
involvement in criminal offense-they,nevertheless,drew upon it for guidance in deter mining the
excessiveness of the fine at issue.(Id.)This Administrative body should apply the same analysis.
Consequently,factors,including the nature of the crime,its criminal punishment,and the
har m Appellants have caused,should be considered. The “crime”here amounts to only one
violation of the PMSC.Upon receiving notice of their first and only violation,Appellants
immediately discontinued their offensive conduct and rectified the issue by canceling all upcoming
short-ter m vacation rentals.Appellants did not ignore or disobey the violation.Rather,in good faith,
they stopped hosting all short-ter m vacation rentals at the subject property.
Most importantly,were it not for Appellants’mistake in failing to procure a short-ter m
vacation rental per mit prior to engaging in the offensive conduct,Appellants would have been
otherwise eligible for obtaining a short-ter m rental vacation permit.The subject property has no
rental restrictions.
In analyzing the last factor,the har m done by the appellants crime of failing to procure a
short-ter m rental per mit prior to subletting the subject property,the har m done is hardly egregious.
No individual renters were har med,no noise complaints were issued,and no evidence of a nuisance
was found at the subject property.Moreover,the City of Palm Springs will still receive the monetary
benefit of appellants’violating conduct.Appellants will be paying a $5000 fine as civil penalty and
have already paid over $800 in order to file the instant appeal.Appellants are even amenable to
paying additional monetar y fine to avoid the “permanent ineligibility”requirement.Appellants are
also happy to cure the violation by applying for a short-ter m vacation rental per mit as soon as
possible.
By contrast,the court in Sainez deter mined that a $663,000 fine was constitutional when
taking into account the har m done by the defendants’“crime”of failure to correct their violations.
(Sainez,supra,at 432.)However,the violations in the Sainez matter were significantly more egregious
as they “included a complete lack of heat to elderly,fixed income tenants,insufficient heat to others,
broken and leaking walls and ceilings,exposed wiring,lack of adequate fire protection,and illegal
construction that blocked fire and emergency egress.”(Id.)Some of the violations went uncured for
years,and tenants suffered illness and cold.Consequently,the Court deter mined that “defendants
did ‘har m’of another sort by flouting the City’s efforts to secure cor rections.”(Id.)
Therefore,Appellants argue that the “per manent ineligibility”provision of PSMC section 5.25.et
al.,is a clear violation of the constitutional protections against excessive fines.Appellants contend
that they should not be per manently ineligible from utilizing the subject property as a short-ter m
vacation rental for a first-time violation.Appellants argue that they did not ignore the City’s citation
as they stopped and/or canceled all short-ter m vacation rentals upon receiving notice and made
ever y effort to cure the violation.But for Appellants’failure to procure the per mit in advance,
Appellants would have otherwise been eligible to operate the subject property as a short-term rental.
Appellants are amenable to paying the $5000 by way of a payment plan and are even amenable to
receiving a temporar y suspension of their ability to utilize the subject property as a short-ter m rental.
However,Appellants maintain that the per manence of PSMC section 5.25.et al.,as written,is
excessive and disproportionate to the nature of the violation itself.
3.Conclusion
In light of the arguments delineated above,Appellants respectfully urge this Court to refrain
from per manently banning Appellants from operating a short-ter m vacation rental in the City of
Palm Springs.
Appellants
Rachel Kashani
Sher ri Sturges