Intervention911 v. City of Palm Springs

          ORDER DENYING DEFENDANT’S MOTION TO ENFORCE THE SETTLEMENT AGREEMENT [183]

          OTIS D. WRIGHT, II UNITED STATES DISTRICT JUDGE

         I. INTRODUCTION

         Before the Court is Defendant City of Palm Spring’s Motion to Enforce the Settlement Agreement. (ECF No. 183.) Following a three-year dispute between the City and Plaintiff Intervention911 over the proper zoning classification for two sober living facilities, the parties agreed to a one and one-half page “Mediation Plan” that lays out a complex path to settlement. The Mediation Plan required, among other things, that “[t]he City’s clerk, manager, and attorney . . . recommend a waiver of any requirement of upgrades under the current state fire code.” The question now is to whom that recommendation must be made-the City contends that the recommendation must be made to the City Council, whereas Intervention911 contends that the recommendation must be made to the State of California. Because neither the words of the agreement nor the context in which the agreement was made clarifies the issue, the Court concludes that the Mediation Plan is void and unenforceable. As a result, the Court DENIES the City’s Motion. (ECF No. 183.)

         II. FACTUAL BACKGROUND

         A. Pre-Litigation Dispute

         Between 2011 and 2012, Intervention911 opened two sober living facilities in Palm Springs, California. (Mot. for Summ. J. Order at 2-3, ECF No. 92.) Soon after, persons living near the facilities lodged complaints with the City, most of which focused on the residents’ fear that the facilities would increase crime in the neighborhood, or would otherwise cause a nuisance. (Id. at 6-9.)

         The sober living facilities are located on land zoned for “R2” use.^[1] On R2-zoned land, hotels are permitted to operate as a matter of right, while other uses, such as assisted living facilities, must obtain a conditional use permit (“CUP”). (Id. at 10- 11.) The terms “hotel” and “assisted living facility” are defined in the City’s zoning code, and where a facility does not fit neatly within either definition, the code grants the City’s Planning Director authority to determine its classification. (Id. at 11.)

         In April 2012, the City informed Intervention911 that it considered the facilities to be “assisted living facilities, ” and thus that Intervention911 was required to apply for a CUP. (Id. at 11-12.) In June 2012, Intervention911 applied for the CUP. (Id. at 12.) The City declined to recommend approval of the CUP applications. (Id.) Intervention911 then withdrew its applications and sent a letter to the City, arguing that the facilities be treated as “hotels” rather than “assisted living facilities, ” thereby allowing them to operate as a matter of right in the R2 zone. (Id.) The City again declined to treat them as hotels instead of assisted living facilities. (Id.)

         Separately, in December 2012, the City’s Fire Department decided to reclassify the facilities as drug abuse recovery and treatment facilities. (Id. at 14-16.) This required Intervention911 to upgrade certain fire safety equipment on the premises, including installing automatic fire sprinkler systems and fire alarm and detection systems. (Id.) The Fire Department has the discretion to waive the upgrade requirement if it determines that the new use is less hazardous than the prior use. Here, it determined that a drug abuse recovery and treatment facility was not less hazardous than the prior use. (Id.)

         B. Pre-Settlement Procedural History

         In June 2013, Intervention911 filed suit against the City, alleging intentional discrimination and failure to provide a reasonable accommodation under the Fair Housing Act, the Fair Employment and Housing Act, and the Americans with Disabilities Act. (ECF No. 1.) On July 7, 2014, the Court granted summary judgment on Intervention911’s reasonable accommodation claims. (ECF No. 92.) The remaining claims were set for trial in September 2014. However, on August 21, 2014, after an extensive mediation, the parties agreed to the Mediation Plan and the Court vacated the trial date. (ECF Nos. 155-56.)

         C. The Mediation Plan

         The Mediation Plan is a one and one-half page document that lays out a complex path to resolution of the lawsuit. Under the Mediation Plan, the City would first reactivate Intervention911’s CUP applications for consideration. (Kaufman Decl. Ex. C. ¶ 2, ECF No. 183-3.) In addition, “[t]he City’s clerk, manager, and attorney will also recommend a waiver of any requirement of upgrades under the current state fire code and that the Fire Department rescind the December 26, 2012, memorandum.” (Id. ¶ 3.)

         Moreover, the City’s clerk, manager, and attorney “shall” recommend to the City Planning Commission and City Council approval of the CUP applications “with any conditions deemed appropriate.” (Id. ¶ 2.) However, before any submission to the City Planning Commission and City Council, the City must first submit the conditions to Intervention911’s counsel for review. (Id. ¶ 2.) Intervention911’s counsel “may” accept or reject any of the conditions. (Id. ¶ 6.) If the “final authority” (presumably the City Council) approves the permits without modifications, then Intervention911’s acceptance of the conditions “will be final.” (Id.) If, however, the “final authority” approves the permits with modifications, then Intervention911 shall still have “the sole and absolute discretion to reject the permits.” (Id.) If Intervention911 accepts the modifications, then the Mediation Plan becomes a final settlement agreement, and the parties must move ...