Amicus Curiae Brief — Galland v. City of Clovis

(g Supreme Court, U.S.

FILED

No. 00-1903

= _sJUL_23 200!

Bhp CLERK

Supreme Court of the United-States-——

¢

ROGER AND VIRGINA GALLAND,

Petitioners,

CITY OF CLOVIS, CLOVIS CITY COUNCIL, and

CLOVIS MOBILE HOME RENT COMMISSION,

Respondents.

*

On Petition For Writ Of Certiorari

To The Supreme Court Of California

¢

BRIEF OF AMICI CURIAE, CALIFORNIA

ASSOCIATION OF REALTORS® AND NATIONAL

ASSOCIATION OF REALTORS®, IN SUPPORT OF

PETITION FOR WRIT OF CERTIORIARI

Sf

June Basrracki Bartow, Eso. Laurene K. JANik, Esa.

Vice President and General Counsel

General Counsel RatepH W. Ho men, Eso.

Sonia M. Younctove, Ese.* Associate General Counsel

Senior Counsel NATIONAL ASSOCIATION

CALIFORNIA ASSOCIATION or REALTORS®

or REALTORS® 430 North Michigan

525 South Virgil Avenue Avenue

Los Angeles, California Chicago, Illinois 60611-4087

90020-1403 (312) 329-8375

(213) 739-8200

*Counsel of Record

Counsel for Amici Curiae,

California Association of REALTORS®

and National Association of REALTORS®

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964

OR CALL COLLECT (402) 342-2831

i

TABLE OF CONTENTS

Page

BRIEF OF AMICI CURIAE, CALIFORNIA ASSOCIA-

TION OF REALTORS® AND NATIONAL ASSO-

CIATION OF REALTORS®, IN SUPPORT OF

PETITION FOR WRIT OF CERTIORARI..........

IDENTITY AND INTEREST OF AMICI CURIAE....

THE PETITION FOR WRIT OF CERTIORARI

SHOULD BE GRANTED BECAUSE CALIFORNIA

SHOULD NOT BE PERMITTED TO PRE-EMPT

FEDERAL LAW AND CIRCUMVENT DUE

PROCESS RECOVERY UNDER THE 14TH

AMENDMENT TO THE UNITED STATES CON-

SEs kbc tbccceavsndgranwasnaneaisnareeas

A.

In Violation of Constitutional Law, California

Requires Exhaustion of Administrative

Remedies Prior to Allowing a Section 1983

CR cs chen pedse bi wdeceateu ba wan sense dens

The California Supreme Court Has Created a

Convoluted Process For Analyzing Due Pro-

cess Violations That, By Itself, Violates Due

PR su ha a bo odebddscawansddarevadennaaaces

California’s Reliance On a Kavanau Adjustment

Violates Public Policy By Placing the Burden of

the Excessive Damages Caused By the City On

PORE PORTED 6 ons cece cnr s cece scscensecee

CIE 5 bb Waka es eee kaa da nneseataernecncnds

|

ii

TABLE OF AUTHORITIES

Page

CAsEs:

Brosterhous v. State Bar of California, 12 Cal. 4th 315

(2995) «iss cnuncuen Meerrrerriry te irr rr Tree 5

City of Monterey v. Del Monte Dunes at Monterey,

Lid., 526 U.S. 6B7 (1998). .cccoccdescnscssssasccccie 3

Dolan v. City of Tigard, 512 U.S. 374 (1994) ........... 4

Felder v. Casey, 487 U.S. 131 (1988)............0- 000s 5

First English Evangelical Lutheran Church of Glendale

v. County of Los Angeles, 482 U.S. 304 (1987) ....... 3

Galland v. City of Clovis, 24 Cal. 4th 1003

(2001) . ...... <0 s.40 te 5 075 el an passim

Kavanau v. Santa Monica Rent Control Bd., 16 Cal.

4th 761 (1997) ...<...5.dceeueeeenaeeeee 10, 11, 13, 15

Nectow v. City of Cambridge, 277 U.S. 183 (1928) ...... 4

Nollan v. California Coastal Comm'n, 483 U.S. 825

(1987)... 0.0... cusn nue kine heen met 2, 4

Patsy v. Florida Board of Regents, 457 U.S. 496 (1982) ..... 5

Pennell v. City of San Jose, 485 U.S. 1 (1988).......... 3

Pennsylvania Coal Co. v. Mahon, 260 U.S. 393 (1922) ..... 4

Preseault v. ICC, 494 U.S. 1 (1990).........0c0eceee ee 3

ili

TABLE OF AUTHORITIES - Continued

Page

RULES AND STATUTES:

Rules of U.S. Supreme Court, Rule 37.2.............. 1

Cy Res WF BOD esocccnccccsecansscee 3, 4, 5, 12, 14, 16

OTHER AUTHORITIES:

David S. Mendel, Note, Determining Ripeness of

Substantive Due Process Claims Brought by Land-

owners Against Local Governments, 95 Mich. L.

i a Cn + sbhecenkeadunnaenevesseixanas 12

BRIEF OF AMICI CURIAE, CALIFORNIA

ASSOCIATION OF REALTORS® AND NATIONAL

ASSOCIATION OF REALTORS®, IN SUPPORT OF

PETITION FOR WRIT OF CERTIORARI

Pursuant to Rule 37.2 of the Rules of this Court, amici

curiae, the California Association of REALTORS® (here-

inafter CAR) and the National Association of REAL-

TORS® (hereinafter NAR), submit this brief in support of

the petitioners, Roger and Virginia Galland, in their Peti-

tion for Writ of Certiorari.

IDENTITY AND INTEREST OF AMICI CURIAE}

CAR is a non-profit, voluntary, trade association

incorporated in California whose members consist of

local Boards and Associations of REALTORS®, and

approximately 94,000 persons licensed as real estate bro-

kers and salespersons by the State of California, as well

as affiliate members such as real estate appraisers, title

insurers, mortgage lenders, and real estate attorneys. Fur-

thermore, CAR is actively engaged in promoting and

establishing reasonable standards to govern the transfer

of real estate and the protection of private property

rights. CAR pursues its objectives through a variety of

1 The parties have consented to the filing of this brief. The

joint letter of consent is on file with the Clerk of the U. S.

Supreme Court.

Counsel for a party did not author this brief in whole or in

part. No person or entity, other than the amici curiae, its

members, or its counsel made a monetary contribution to the

preparation and submission of this brief.

methods, including education of its members, creation of

standard form agreements for use in real estate transac-

tions, lobbying, providing legal advice to its members,

and participation as amicus curiae in relevant court cases.

Members of CAR assist the public in buying, selling,

leasing, developing and managing residential, commer-

cial and industrial real estate as well as mobilehomes.

Thus, these members, as well as the public they assist, are

directly impacted by the actions of local municipalities in

regulating real property as well as mobilehomes.

NAR is a ‘non-profit professional association incorpo-

rated in Illinois representing persons in the real estate

industry nationwide. As such, NAR is a champion of the

rights of real property owners throughout the entire

country. NAR’s membership, which includes all the

REALTOR® members of CAR as well as the members of

REALTOR® associations in every other state, consists of

approximately 760,000 persons involved in all aspects of

the real estate profession, including brokerage, manage-

ment, appraisal, and counseling. Through its participa-

tion in cases before this Court and others, NAR has long

sought to preserve for property owners the rights guaran-

teed to them by the 5th and 14th Amendments to the

Constitution.

Unfortunately, due to the oftentimes misguided, or in

some cases even hostile, actions that local municipalities

and courts have taken with regard to landowners’ consti-

tutional rights, both CAR and NAR have been actively

involved in land use cases. CAR and NAR have partici-

pated previously as amici curiae before numerous courts

including the seminal cases of Nollan v. California Coastal

———e

Comm'n, 483 U.S. 825 (1987), and First English Evangelical

Lutheran Church of Glendale v. County of Los Angeles, 482 U.S.

304 (1987), and more recently in Pennell v. City of San Jose, 485

U.S. 1 (1988), and City of Monterey v. Del Monte Dunes at

Monterey, Ltd., 526 U.S. 687 (1999). NAR also participated as

amicus curiae in Preseault v. ICC, 494 U.S. 1 (1990).

The current state of affairs in California again makes

it imperative that CAR and NAR take on their respon-

sibilities as amici curiae. In the case before this Court, the

California Supreme Court has denied landowners their

constitutional rights by barring action under 42 U.S.C.

§ 1983 unless these landowners first exhaust lengthy and

burdensome administrative procedures. The California

Supreme Court’s decision thus represents a fundamental

misunderstanding and misapplication of this Court's

well-established precedents, requiring correction and

clarification by this Court.

CAR, NAR and their members are concerned with

the abuse of power by local government that infringes

upon the constitutional rights of landowners. The Califor-

nia Supreme Court's constitutionally flawed analysis pre-

cludes a property owner from the opportunity to

challenge the constitutional propriety of a regulator’s

excessive and burdensome administrative proceedings

unless and until the property owner endures further

lengthy and costly administrative proceedings. As stated

by California Supreme Court Justice Brown in her dis-

senting opinion describing the action taken by the court,

“We now intervene to eviscerate a federal civil rights

remedy whose very purpose is to provide an alternative

to abusive or corrupt state adjudicative procedures like

those the Gallands had to endure. . . . ” Galland v. City of

Clovis, 24 Cal. 4th 1003, 1046 (2001). This Court’s action is

necessary to correct this error by the influential Califor-

nia Supreme Court, lest it be replicated by courts else-

where to permit further constitutional injury to property

owners throughout our nation.

THE PETITION FOR WRIT OF CERTIORARI SHOULD

BE GRANTED BECAUSE CALIFORNIA SHOULD NOT

BE PERMITTED TO PRE-EMPT FEDERAL LAW AND

CIRCUMVENT DUE PROCESS RECOVERY UNDER

THE 14TH AMENDMENT TO THE UNITED STATES :

CONSTITUTION.

A. In Violation of Constitutional Law, California

Requires Exhaustion of Administrative Remedies

Prior to Allowing a Section 1983 Claim.

Landowners like the Gallands, who suffer economic

harm as a result of unconstitutionally overzealous or

excessive land use regulation, have various constitutional

remedies available, including a 5th Amendment takings

claim, a 14th Amendment equal protection claim, and

14th Amendment procedural and substantive due process

claims (42 U.S.C. § 1983). In the land use arena, this Court

has consistently protected landowners against due pro-

cess violations in contravention of the 14th Amendment.

Dolan v. City of Tigard, 512 U.S. 374 (1994); Nollan v.

California Coastal Comm'n, 483 U.S. 825 (1987); Nectow v.

City of Cambridge, 277 U.S. 183 (1928); Pennsylvania Coal

Co. v. Mahon, 260 U.S. 393 (1922).

Previous decisions of this Court, as well as prior

California case law, have made it eminently clear that a

plaintiff need not exhaust state judicial or administrative

remedies prior to filing a due process claim in either state

|

or federal court. Felder v. Casey, 487 U.S. 131 (1988) (Wis-

consin notice of claim statute requiring special pro-

cedures prior to filing Section 1983 claim is pre-empted

pursuant to the Supremacy Clause); Patsy v. Florida Board

of Regents, 457 U.S. 496 (1982) (Exhaustion of state admin-

istrative remedies is not a prerequisite to an action under

Section 1983); Brosterhous v. State Bar of California, 12 Cal.

4th 315 (1995) (Section 1983 action cannot be limited by

the existence of state procedures to arbitrate the issues).

In this case now before the Court, however, Galland v.

City of Clovis, 24 Cal. 4th 1003 (2001), the California

Supreme Court carves an exception to the due process

rights secured by the federal constitution in relation to

land use and, in particular, regulation of mobilehome

park rents. The California Supreme Court held that a

landowner may maintain an action for damages under

Section 1983 only after the landowner first exhausts

administrative remedies. Specifically, according to the

court, a governmental agency must, in effect, be afforded

the opportunity to conduct further administrative hear-

ings in an attempt to undo the grave constitutional viola-

tions it caused in the first round of administrative

hearings. As noted by Justice Brown in her dissenting

opinion, “this exhaustion requirement applies even

where unfairness in the administrative hearing process

was the source of the constitutional injury. This conclu-

sion directly contravenes Patsy v. Florida Board of

Regents. . . . ” Galland at 1045. There is no basis for an

exception to the principle embodied in and embraced by

Patsy in the context of Section 1983 challenges to land use

regulation, and it is essential that this Court review this

case in order to correct the contrary holding of the Cali-

fornia Supreme Court.

The facts of this case will give any landowner night-

mares. The egregious acts of the rent control commission

(Commission) and city council (Council) of the City of

Clovis (collectively, hereinafter, Clovis) were condemned

by both the trial court and the California Court of

Appeal. The trial court described the Clovis rent review

process as “so time consuming burdensome and expen-

sive that the potential benefits of participating in the

process were nonexistent and illusory, all of which the

Commission and Council were well aware, but neverthe-

less, continued to perpetuate.” CT 2571-2572 (Gallands’

Cal. Sup. Ct. Answer Brief on the Merits at 26) (Peti-

tioner’s Appendix at 149).2

According to the California Court of Appeal, ” ‘the

long and tortured path this case has taken to date mili-

tates against sending the matter back for further adminis-

trative proceedings addressing these ancient claims.’ ”

Galland at 1029.

The Clovis rent control ordinance itself invites the

tortuous path to which Petitioners were subject, since it

provides no standards for calculating appropriate rental

increases.? Prior to the administrative review hearings for

the 1988 rent increase, the Gallands requested, but never

2 CT refers to the trial court transcript; Supp CT refers to

ihe supplemental trial court transcript of the administrative

proceeding.

3 In 1993, Clovis amended its rent control ordinance to

permit automatic annual rent increases tied to the Consumer

Price Index. Galland v. City of Clovis, 24 Cal. 4th 1003, 1018.

received, any clear guidelines as to the materials and

information Clovis wanted produced for the administra-

tive hearings. Subsequently, Clovis managed to make

many costly and unreasonable demands for information

(e.g., confidential information on the other mobilehome

parks managed by their property manager, such as the

cash flow for the sixteen other parks, including figures

for income and expenses for ten years for each park).4

Gallands’ Cal. Sup. Ct. Answer Brief on the Merits at 13

(Petitioner’s Appendix at 8-9).

The Gallands incurred huge legal and expert witness

fees in educating the Commission and the Council as to

the appropriate guidelines in applying the Clovis rent

control ordinance. During the Commission hearing, in

reply to the Gallands’ claim that they had incurred these

fees in response to the order of the Council, the Chairper-

son of the Commission, Charlene Wallert, stated:

You were faced with a council with the idea of

having to do this and you knew in your mind

that it was expensive and probably you knew

that even if you got the $6 rate increase, it

wouldn’t pay for the money you've expended

on this. Why at that point did[n’t] you say, “this

is too expensive for me. I’m just going to drop

the whole thing and apply for a rent increase

* The administrative proceedings on the 1988 $6.00 per

month rental increase cost the Gallands $141,257. Supp. CT 1 et

seq. (Gallands’ Cal. Sup. Ct. Answer Brief on the Merits at 13).

The cost of the 1989 proceedings was $31,955. Supp. CT 1 et seq.

(Gallands’ Cal. Sup. Ct. Answer Brief on the Merits at 17). The

1990 proceedings cost the Gallands $47,541. Supp. CT 1 et seq.

(Gallands’ Cal. Sup. Ct. Answer Brief on the Merits at 21).

next year?” Supp. CT 2662:3-12 (Gallands’ Cal.

Sup. Ct. Answer Brief on the Merits at 15).

Thus, the ordinance, and the California Supreme

Court’s elimination of the Gallands’ right to challenge the

constitutionality of its application to them, places the

Gallands between the proverbial rock and a hard place. In

order to get their $6 per month rental increase, they had

to educate the Commission and Council regarding the

appropriate method of determining a reasonable rate of

income and an appropriate price index to apply to factor

in inflation. In order to satisfy Clovis’s demands for

additional information, the Gallands had to hire costly

legal and financial experts to compile extensive narrative

information as well as charts and tables comparing var-

ious mobilehome parks.

Notwithstanding the Gallands’ substantial invest-

ment of time, effort, and money, the Commission held

that the Gallands could not treat these fees as operating

costs — meaning they cannot recoup these costs by

increasing the rental rates. Even the President of the

Commission expressed surprise that the Gallands both-

ered to ask for a rental increase when the cost of asking

was greater than the return from the rental increase.

Clovis had effectively created a Catch-22 situation for

landowners!

Indeed, the critical importance of the Gallands’ right

to challenge the city’s action is reinforced and illustrated

by Clovis’s delay of the administrative process, causing

further losses and constitutional injury to the Gallands.

For example, the hearing on the 1988 rent increase, in

which the Commission disallowed the legal and expert

fees as operating expenses, was concluded on December

13, 1989, (Supp. CT 2702) (Gallands’ Cal. Sup. Ct. Answer

Brief on the Merits at 16), but the Gallands were not

permitted to appeal this decision to the Council until the

final written decision was issued by the Commission.

Nevertheless, the Commission refused to issue a final

decision until January 29, 1992 - two years later - and

they only did so after the Gallands sought a court order

directing its issuance. Supp. CT 2462 et seq. (Gallands’

Cal. Sup. Ct. Answer Brief on the Merits at 16).

Thus, the egregiousness of the City’s actions is clear,

and is only further aggravated by the California Supreme

Court’s denial of the Gallands’ right to even challenge

those actions until after the Gallands first pursued fur-

ther proceedings before the City. This Court’s interven-

tion is essential to correct these abuses before that flawed

result is adopted in other jurisdictions as well.

B. The California Supreme Court Has Created a Con-

voluted Process For Analyzing Due Process Viola-

tions That, By Itself, Violates Due Process.

The California Supreme Court has created a needless,

unnecessarily complicated, unprecedented and unjust

procedure that rental property owners must endure to

seek redress for due process violations by California rent

control regulators. This is apparent in two respects. First,

the court focused on the injury imposed by “confis-

catorily low rents” and concluded that, with respect to

the due process rights of the owner, such economic depri-

vations must be treated the same as those caused by a 5th

Amendment taking. The court suggests that there has

10

been no due process violation if a Kavanau adjustment could

compensate the landowner for the confiscatorily low rents.°

According to the court in Kavanau, the adjustment in

future rents for due process violations is simply akin to

the amortization of the costs of capital improvements )

over the useful life of those improvements. Kavanau at

769. What is the useful life of the costs of excessive

overburdensome administrative proceedings? Kavanau

does not provide an answer. Furthermore, in Kavanau, the

court was not dealing with a flawed process as we have in

the case before this Court, but instead a flawed result. |

However, the California Supreme Court in Galland,

acknowledging that a Kavanau adjustment might prove to

be inadequate to make the landowner whole, provides |

the following rule:

[W]hen landlords seek section 1983 damages

from allegedly confiscatory rent regulation, we

hold that they must show (1) that a confiscatory

rent ceiling or other rent regulation was

imposed and (2) that relief via a writ of mandate

and a Kavanau adjustment is inadequate. Galland

at 1025.

Unlike a 5th Amendment inverse condemnation

claim, however, where an element of the claim is the

5 A Kavanau adjustment refers to the remedy created by the

California Supreme Court in Kavanau v. Santa Monica Rent |

Control Bd., 16 Cal. 4th 761 (1997), for an inverse condemnation j

claim. The court held that Kavanau was not entitled to maintain

his inverse condemnation action because he could obtain “a full

and adequate remedy for any interim loss flowing from the due

process violation through an adjustment of future rents under

the rent regulation process.” Id. at 767.

es |

11

government’s failure to provide just compensation, a due

process violation occurs where the government has acted

in a sufficiently arbitrary fashion and injured the claim-

ant. Whether or not the government has later provided a

remedy for the injury does not eliminate the due process

violation. Thus, there is no constitutional basis to treat

inverse condemnation and due process claims similar for

Section 1983 purposes, and subject the latter, like the

former, to the Kavanau adjustment process.

Second, the California Supreme Court also erred in

its consideration of the “excessive procedural costs” —

those increased costs arising from the flawed rent control

review process and the resultant litigation. After estab-

lishing a new “deliberately flouts the law” standard for

finding a violation of substantive due process, the court

rejects the trial court’s findings and remands the cause to

the trial court again. Galland at 1030-1040.

In essence, the California Supreme Court has created

a procedural nightmare for a landowner who must go to

the trial court for a rehearing to determine if Clovis has

“deliberately flouted the law.” In the event Clovis is

found guilty only of “bureaucratic bungling,” short of the

California Supreme Court’s standard for a constitutional

violation, the landowner may have to return again to

Clovis for another attempted Kavanau adjustment. Should

the excessive administrative costs be so great that a

Kavanau adjustment is not possible, then must the land-

owner go to the trial court again? Will Clovis now be

found guilty of a constitutional violation if the adminis-

trative and procedural costs are so great that a Kavanau

adjustment is impossible? Or, will the landowner have to

12

go bankrupt because the costs created by the administra-

tive process exceed the future flow of income from rents?

The entire convoluted process created by the Califor-

nia Supreme Court places an additional and unwarranted

hardship on landowners who have already spent huge

sums of money in their frustrated attempts to comply

with the requirements of a vague rent control ordinance

and a demanding, insatiable Commission and Council.

This process is reminiscent of another in the land use

arena, as described by a legal scholar:

Local governments . . . may violate the substan-

tive due process rights of landowners, and then

rely on lengthy local appeals processes to fore-

stall suit in federal court. Landowners of limited

financial means may not be able to endure the

lengthy administrative processes and litiga-

tion... . ” David S. Mendel, Note, Determining

Ripeness of Substantive Due Process Claims Brought

by Landowners Against Local Governments, 95

Mich. L. Rev. 492, 496 (1996).

Clearly the convoluted process crafted by the Califor-

nia Supreme Court for bringing Section 1983 due process

claims places such a totally unreasonable burden on Cali-

fornia rental property owners that the process itself vio-

lates landowners’ constitutional rights to due process

under the law.

13

C. California’s Reliance On a Kavanau Adjustment

Violates Public Policy By Placing the Burden of the

Excessive Damages Caused By the City On Innocent

Parties.

This Court should also review this case because of

yet another unacceptable effect of the California Supreme

Court’s extraordinarily strict “flouts the law” standard

for finding a violation of the Gallands’ due process rights

resulting from the unduly burdensome and costly process

for seeking a rent increase: Because of the court’s deter-

mination that the “excessive procedural costs” may be

considered and included when determining allowable

rental increases pursuant to a Kavanau adjustment, the

court’s holding allows these costs to be imposed on inno-

cent parties. Galland at 1040. By insisting that these

“excessive procedural costs” be taken into account, if at

all, as part of the Kavanau adjustment, the court is impos-

ing absolutely no liability upon Clovis for its due process

violations and is instead placing the burden on innocent

landowners as well as innocent mobilehome tenants

caught in the middle. Id. at 1040.

The California Supreme Court will hold Clovis liable

for these costs only if the city imposed the costs origi-

nally “in deliberate contravention of the law to obstruct

the Gallands’ constitutionally based property rights.” Id.

at 1040. Thus, not only does the California Supreme

Court place a costly burden upon landowners by its

creation of a standard that allows a tremendous level of

abuse against landowners before any liability is imposed

upon the city, but to the extent the city has not acted

quite outrageously enough to meet that standard, the

14

court’s holding allows those costs to be shifted to the

present and future tenants of the owner.

Thus, the California Supreme Court holding means

that despite “shifting” demands, “costly” demands, “‘ill-

considered requests for information” that create a bur-

densome, costly, outrageously expensive hearing process

by governmental agencies, ultimately the landowner and

the tenants are the ones most likely to foot the bill. The

governmental agency responsible for all the additional

unreasonable costs can get away with violating due pro-

cess. Landowners and the mostly economically-disadvan-

taged tenants of mobilehome parks will have to pay for

the city’s egregious mistakes.

The California Supreme Court in Galland has there-

fore, in effect, carved an exception to Section 1983

remedies at the expense of the federal constitutional

rights of California mobilehome park owners and ten-

ants. Not only does this “exception” violate the constitu-

tional rights of California landowners and tenants, but it

will have a negative impact ultimately on the availability

of low-cost housing such as mobilehomes. Moreover,

unless this Court acts to correct this result and declare

this abusive process constitutionally defective, other

courts will undoubtedly follow California’s high court

holding and subject property owners in other jurisdic-

tions to a like fate. This consequence is of great concern

to both CAR and NAR.

There are mobilehome parks not only throughout

California, but the entire nation. In fact, as the number of

retired Americans increases so will the need for low-cost

housing such as mobilehomes. If allowed to stand, the

EE rm

15

ruling in Galland will have a deleterious impact on the

availability of this type of low-cost housing. Owners of

mobilehome parks must accept rent control as a cost of

being in the rental business. However, park owners can-

not afford to pay the excessive and burdensome adminis-

trative costs resulting from municipalities’ “bureaucratic

bungling” when park owners seek rental adjustments

merely to earn a fair and reasonable return on their

property. a

The California Supreme Court offers the following

advice to mobilehome investors:

For those price-regulated investments that

fall above the constitutional minimum, but are

nonetheless disappointing to investor expecta-

tions, the solution is not constitutional litigation

but, as with nonregulated investments, the liq-

uidation of the investments and the transfer of

capital to more lucrative enterprises. Galland at

1026.

Mobilehome park owners, like the Gallands, may

very well heed the advice of the California Supreme

Court and turn their mobilehome parks into more lucra-

tive enterprises at the expense of those tenants who most

need low-cost housing.

Sd

CONCLUSION

Despite the trial court’s findings and California

Court of Appeal’s conclusions that Clovis violated the

Gallands’ due process rights, the California Supreme

Court holds that “remand to the city is what Kavanau

16

prescribes. . . . Clovis has endeavored to amend its rent

control ordinance to make it more efficient and expe-

ditious. If Clovis engages, however, in further needless

delay, then a writ of mandate to the trial court may

legitimately request that the cowrt intervene to set the

proper rental rates, and the city may be liable for section

1983 damages.” Galland at 1029. The California Supreme

Court then aggravates this error by also establishing an

unprecedented and extraordinarily high standard for

determining whether the procedure to which the owners

were subject in seeking an adjustment to the rents vio-

lated their due process rights.

The holding in Galland creates an exception to well-

established constitutional law. This Court should not

allow this decision to stand. To deny a writ of certiorari is

to suggest that Galland correctly reflects the law as estab-

lished by this Court. Clovis and other governmental enti-

ties in California are now free to trample landowners’

due process rights. It makes no sense. Nor is it fair.

California landowners should not be deprived of their

rights under the U.S. Constitution.

17

For the reasons stated herein, this Court should grant

the Petition for a Writ of Certiorari.

DATED: July 23, 2001

Respectfully submitted,

June Basrracki Bartow, Esa. LaureneE K. JANIk, Eso.

Vice President and General Counsel

General Counsel Ratpw W. Hotmen, Esa.

Sonia M. Younctove, Eso.* Associate General Counsel

Senior Counsel NATIONAL ASSOCIATION

CALIFORNIA ASSOCIATION or REALTORS®

or REALTORS® 430 North Michigan

525 South Virgil Avenue Avenue

Los Angeles, California Chicago, Illinois 60611-4087

90020-1403 (312) 329-8375

(213) 739-8200

*Counsel of Record

Counsel for Amici Curiae,

California Association of REALTORS®

and National Association of REALTORS®