Redln Enterprises v. City of San Diego CA4/1

CourtCalifornia Court of Appeal
DecidedApril 15, 2013
DocketD060164
StatusUnpublished

This text of Redln Enterprises v. City of San Diego CA4/1 (Redln Enterprises v. City of San Diego CA4/1) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Redln Enterprises v. City of San Diego CA4/1, (Cal. Ct. App. 2013).

Opinion

Filed 4/15/13Redln Enterprises v. City of San Diego CA4/1 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

COURT OF APPEAL, FOURTH APPELLATE DISTRICT DIVISION ONE

STATE OF CALIFORNIA

REDLN ENTERPRISES, INC. et al., D060164

Plaintiffs and Appellants,

v. (Super. Ct. No. 37-2009-00085820- CU-EI-CTL) CITY OF SAN DIEGO et al.,

Defendants and Respondents.

APPEAL from a judgment of the Superior Court of San Diego County, Timothy

Taylor , Judge. Affirmed.

Appellants Redln Enterprises, Inc. and Daniel Kullberg, the president and majority

shareholder of Redln (collectively Redln), appeal the successful demurrer of respondents

City of San Diego (City) and William Zounes, a development project manager of the City

(Zounes), to Redln's second amended complaint (SAC). Redln contends the court erred

when it found the SAC did not state facts sufficient to support claims for inverse

condemnation or takings (first cause of action) and for violation of civil rights pursuant to title 42 United States Code section 1983 (section 1983) for regulatory taking (second

cause of action).1 Redln also contends the court abused its discretion by not granting

Redln leave to amend the SAC to state a new cause of action for selective enforcement.

Affirmed.

BACKGROUND

Because this is an appeal following a successful demurrer, we accept as true all

facts properly pled in Redln's SAC, and also incorporate any facts judicially noticed.2

(Gu v. BMW of North America, LLC (2005) 132 Cal.App.4th 195, 200.)

The SAC alleges that Redln, doing business as "All in One," obtained a business

license from the City in 1997 to sell used cars wholesale to dealers on property generally

located at 943-949A Heritage Road, San Diego (the property). (SAC, ¶¶ 10, 12.) Redln

that same year received the required approval from the Department of Motor Vehicles

(DMV) to operate this business.

The SAC further alleges that in July 1999, doing business as "Vehicle Storage

Auction Pool" (VSAP), Redln obtained written approval from the City to operate a

1 We note from the record that Redln's complaint asserts four causes of action, including two additional causes of action based on section 1983 (e.g., third cause of action for unlawful policy/custom and fourth cause of action for failure to train employees). On appeal, however, Redln challenges only the demurrer to its first and second causes of action.

2 Respondents' unopposed request for judicial notice of various sections of the San Diego Municipal Code (SDMC) is granted. 2 vehicle wholesale auction business on the property. (SAC, ¶¶ 13-15.) The following

month, the DMV issued Redln an occupational vehicle dealer's wholesale license.

In 2005, personnel from the County of San Diego (County) suggested Redln

submit a bid to provide auction services for the County. Redln, in turn, contacted the

City and explained it needed different licenses than the ones it then possessed in order to

sell equipment and vehicles directly to the public, as contemplated under a proposed

agreement with the County. Redln was referred to Zounes.

The SAC alleges that in February 2006, Zounes responded to Redln on behalf of

the City. Zounes advised Redln that its then present wholesale auction activity conducted

by VSAP was not permitted by the zoning for the property as set forth in section

103.1103 of the SDMC and that Redln needed to obtain a conditional use permit (CUP)

to operate that business. (SAC, ¶ 17.) Zounes also advised Redln that due to "sensitive

vegetation" on portions of the property, Redln also was required to obtain a site

development permit (SDP). In March 2006, the City's zoning project officer notified

Redln that an auction facility was not a permitted use on the property because "it was not

'wholesaling.'" (SAC, ¶ 19.) Redln disputed it was required to obtain either permit.

Beginning in May 2006, Redln ceased conducting wholesale auctions on the

property. (SAC, ¶ 20.) Redln "thereafter transported the vehicles it periodically had for

sale" to another wholesale auction house located nearby. (Ibid., italics added.) Redln

continued to sell used cars wholesale to dealers from the property.

3 The SAC alleges that in October 2007, City code enforcement coordinator Melody

Negrete served Redln with a civil penalty and notice order (civil penalty order) "stating

that [Redln] required a CUP and SDP . . . to operate the auto auction business, that the

[p]roperty was no longer being used as an auto dismantling facility, and that the prior

CUP had 'expired.'" (SAC, ¶ 22.) The civil penalty order also cited Redln for violating

various provisions of the SDMC for unlawfully erecting and using buildings and

structures without the proper permit and inspection approvals. The civil penalty order

gave Redln until November 9, 2007 to correct the violations.

The appeal of the civil penalty order commenced in January 2008 before

administrative law judge Nancy Beardsley (ALJ). After several days of testimony, the

ALJ on May 10, 2008 issued a 19-page administrative enforcement order (enforcement

order) ruling that Redln did not need a CUP but that it did need an SDP because

according to the ALJ, Redln began operating its auction business after the new land

development code requiring an SDP became effective on January 1, 2000. The ALJ also

ruled that Redln could stay on the property if it applied for an SDP by no later than

August 31, 2008 and that until the SDP application was deemed complete and was

approved by the City, Redln was not entitled to conduct any automobile auctions (as

opposed to sales) from the property.

Alternatively, if Redln did not apply for an SDP within the appropriate time frame,

the ALJ ruled Redln was to cease all business activities on, and clear and vacate all

business operations from, the property.

4 Following the enforcement order, Redln sought clarification regarding whether All

in One could continue its business operations on the property while VSAP applied for an

SDP. The SAC alleges that the ALJ referred the matter to Zounes, who responded by

letter on August 5, 2008 that Redln could not conduct any "development" on the

property, as defined under the SDMC, until an SDP was approved.3 (SAC, ¶ 31; Exh. 4

to SAC.) Redln alleged in the SAC on information and belief that SDP compliance could

have taken up to two years and cost several hundred thousand dollars. As set forth in its

SAC, based on Zounes's response Redln determined it could not conduct any business on

the property while it sought an SDP.

Rather than move forward with an SDP application, Redln filed a writ of

mandamus in the Superior Court, County of San Diego (case No. 37-2008-00089656-

CU-WM-CTL; writ petition) and discontinued business operations on the property. The

SAC alleges that the court subsequently granted Redln's motion to augment the

administrative record to include auction receipts that predated January 1, 2000 and

remanded the matter to the administrative hearing officer with instructions to hold a

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