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Sjcbc, LLC, et al v. Joseph Horwedel

November 30, 2011

SJCBC, LLC, ET AL., PLAINTIFFS AND APPELLANTS,
v.
JOSEPH HORWEDEL, AS DIRECTOR, ETC., DEFENDANT AND RESPONDENT.



Trial Court: Santa Clara County Superior Court Superior Court No.: CV170271 Trial Judge: The Honorable Kevin J. Murphy

The opinion of the court was delivered by: Rushing, P.J.

CERTIFIED FOR PUBLICATION

(Santa Clara County Super. Ct. No. CV170271)

I. STATEMENT OF THE CASE

Petitioners the San Jose Cannabis Buyer's Collective, LLC (SJCBC) and Pharmer's Health Center Cooperative, Inc. (Pharmer's) filed a petition for a writ of mandate in which they sought an order requiring the director of the San Jose Department of Planning and Code Enforcement (the Department) to rescind two nuisance abatement orders concerning the distribution of medicinal marijuana at two locations within the city limits of San Jose.*fn1 The court denied the petition due to petitioners' failure to exhaust their administrative remedies, a lack of ripeness, and the failure to demonstrate irreparable harm.*fn2 It then dismissed the action and entered judgment in favor of the Department.

On appeal from the judgment, petitioners claim that the doctrine of exhaustion of administrative remedies (the Doctrine) was not applicable because their petition came within an exception.

They are correct. The Doctrine was inapplicable and thus we will reverse the order.

II. BACKGROUND

On January 22 and January 26, 2010, the Department issued nuisance abatement compliance orders under section 1.14.030 of the San Jose Municipal Code (the Code) to SJCBC and Pharmer's and the owners of the premises where they had leased space to operate.*fn3 The notices stated that under the Code, property could not be used "in a manner that created a public nuisance." (§ 1.13.040.) The notices explained that a public nuisance involved "[t]he maintenance or use of property in the city in a manner that violates, or real property that has been the situs of a violation, . . . of this code or any other city, state or federal law or regulation." (§ 1.13.050(A)(3).) The notices pointed out that sale of medicinal marijuana and the cultivation or distribution of marijuana for profit violated the California Uniform Controlled Substances Act (Health & Saf. Code, § 11000 et seq.) and the Federal Controlled Substances Act (21 U.S.C., § 812, et seq.); and "[t]he maintenance or use of property in the City as a marijuana dispensary violates 21 U.S.C. Section 841(a), which makes it unlawful to manufacture, distribute, dispense, or possess marijuana with the intent to [do so]." (§ 1.13.050(A)(3).) The notices declared that these uses constituted a public nuisance. The notices also explained that buildings, structures, or land could be used, erected, enlarged, or structurally altered only if doing so complied with the Code and a valid permit issued for such purposes. (§§ 20.40.010(B), 20.10.030.)

The notices then advised the owners, SJCBC, and Pharmer's that the distribution of marijuana at the two leased premises constituted public nuisances because such distribution violated state and federal law and was not an allowed or conditional use in any industrial zoning district in San Jose. The notices further advised that the "[o]peration of an illegal and unpermitted Medical Marijuana/Cannabis Dispensary in a Commercial Pedestrian Zoning District is not an allowed or conditional use in any industrial zoning district." Consequently, the notices required that any and all distribution at the two locations cease on or before February 28, 2010.*fn4

In March 2010, SJCBC's landlord had obtained a preliminary injunction prohibiting SJCBC from dispensing marijuana at its leased premises. On April 1, 2010, Pharmer's landlord had initiated eviction proceedings against Pharma based on the abatement notice. On April 27, petitioners filed the instant petition for a writ of mandate or prohibition. On April 29, petitioners appeared ex-parte and sought an alternative writ of mandate and stay of enforcement of the abatement notices. On May 7, 2010, the court denied a stay and set the matter for a hearing on the merits of the petition. At that time, the court took judicial notice of pertinent sections of the Code and its own records, including the action by SJCBC's landlord. On August 5, petitioners filed supplemental declarations concerning the pending eviction proceedings against Pharmer's. On August 26, 2010, after a hearing, the court denied the amended petition based on petitioners' failure to exhaust their administrative remedies under the Code.*fn5 Judgment was entered on October 13, 2010, and in December, petitioners filed their notice of appeal.

III. STANDARD OF REVIEW

We review the denial of the petition for a writ of mandate on the ground of failure to exhaust administrative remedies under different standards depending on the basis of that decision. We exercise independent review over questions of law such as the interpretation of applicable statutes or codes and whether the Doctrine applies in a given case; we apply the substantial evidence test to factual matters concerning what a party did or did not do. (See Womack v. San Francisco Community ...


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