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State ex rel. Jenkins v. Ratan Hospitality

California Court of Appeals, Second District, Fourth Division
Mar 20, 2008
No. B194660 (Cal. Ct. App. Mar. 20, 2008)

Opinion


STATE OF CALIFORNIA ex rel. MICHAEL JENKINS, as City Attorney, etc., Plaintiff and Respondent, v. RATAN HOSPITALITY et al., Defendants and Appellants. B194660 California Court of Appeal, Second District, Fourth Division March 20, 2008

NOT TO BE PUBLISHED

APPEAL from an order of the Superior Court of Los Angeles County No. BC351925, David F. Yaffe, Judge.

Law Offices of Frank A. Weiser and Frank A. Weiser, for Defendants and Appellants.

Michael Jenkins, City Attorney; Jenkins & Hogin, LLP, Gregg Kovacevich and John C. Cotti, for Plaintiff and Respondent.

MANELLA, J.

Appellants Ratan Hospitality, LLC, P.N. Patel, and Raj Astavakra appeal from an order granting a preliminary injunction. (See Code Civ. Proc. § 904.1, subd. (a)(6).) The injunction prevents appellants from providing certain types of entertainment on premises owned by Ratan Hospitality, Patel’s company, and operated by Astavakra. We affirm.

FACTUAL AND PROCEDURAL BACKGROUND

The essential facts that led to this dispute are not contested. In 2003, appellants applied for and obtained a conditional use permit (CUP) from the City of Diamond Bar (the City). The CUP permitted appellants to operate a restaurant known as Scribbles on a property located within the City, and permitted appellants to offer certain types of entertainment at the restaurant. In April 2006, the City’s Planning Commission modified the CUP to preclude entertainment of any type. Appellants appealed that decision to the City Council, which concurred with the findings of the Planning Commission -- essentially that appellants were exceeding the scope of the CUP by operating a nightclub rather than a restaurant and creating a neighborhood nuisance -- and on May 2, 2006, denied the appeal.

A. Complaint and First Application for TRO/Preliminary Injunction

On May 5, 2006, the City filed a complaint against appellants for public nuisance and violation of its Municipal Code. The complaint alleged that following the issuance of the CUP in 2003, appellants began advertising and operating Scribbles as a nightclub and providing types of entertainment not permitted under the CUP. This led to the Planning Commission’s 2006 decision to modify the CUP to eliminate all entertainment uses, affirmed by the City Council as outlined above. Following the modification of the CUP, appellants “continued to conduct entertainment in violation of [the CUP]” and in April 2006, were issued multiple citations for violation of Municipal Code section 22.78.020.

According to the complaint, section 22.78.020 provides: “‘Any use, structure, or property which is altered, enlarged, erected, established, maintained, moved or operated, contrary to the provisions of this Development Code or any applicable condition of approval, is hereby declared to be unlawful and a public nuisance, and shall be subject to the remedies and penalties specified in the Municipal Code, including this chapter.’” Respondent asked the trial court to take judicial notice of certain provisions of the City’s Municipal Code, but neither this section nor section 1.04.010(e), also cited in the complaint, were among them.

The public nuisance cause of action in the complaint alleged that appellants have “used, maintained and or/allowed others to use” Scribbles as a nightclub in violation of the CUP, and that such use of Scribbles “is an active and continuing nuisance as defined in the Civil Code and by the City’s Municipal Code.” The cause of action for violation of the Municipal Code cited section 22.78.020 and section 1.04.010(e), and contended that appellants provided entertainment at Scribbles in a manner that violated the Municipal Code. The complaint sought a permanent injunction requiring appellants and “their agents, employee, servants, successors or assigns, or anyone acting on their behalf or in concert with them” to cease and desist using Scribbles as a nightclub or otherwise providing entertainment.

The complaint alleged that under section 1.04.010(e) of the City’s Municipal Code, “any condition, use or activity caused or permitted to exist in violation of the provisions of this Code or in violation of any permit, license, approval or entitlement shall be deemed a public nuisance and may be abated by the city by any lawful means, including but not limited to administrative abatement proceedings, restraining order or injunction.”

Along with the complaint, the City filed an application for temporary restraining order (TRO) and preliminary injunction. After both sides submitted evidence and briefing, the court denied the request on the ground that appellants’ use of the property “cannot be enjoined except in an action to abate a public nuisance brought in the name of the People of the State of California.” The court also stated in the order that appellants were not entitled to a trial de novo on the issue “whether they are operating [a] nightclub so as to constitute a public nuisance” because “[a] final administrative decision has been issued by a quasi-judicial administrative agency finding that [appellants] are operating said nightclub in a manner that constitutes a public nuisance” and “[t]hat decision is conclusive and binding upon [appellants] unless and until they overturn it by judicial review pursuant to section 1094.5 of the Code of Civil Procedure.” (Citing City and County of San Francisco v. Ang (1979) 97 Cal.App.3d 673, 678.)

Prior to denying the application, the court directed the parties to address (1) whether the Planning Commission’s April 2006 action modifying the CUP to eliminate all entertainment use was an action taken under section 1094.5 of the Code of Civil Procedure and if so, whether the evidence to be considered by the Court in reviewing that action was limited to that contained in the record of proceedings, and (2) whether section 731a of the Code of Civil Procedure required that the action be brought in the name of the People of the State of California.

B. FAC and Second Application for TRO/Preliminary Injunction

A first amended complaint (FAC) was filed naming respondent the People of the State of California ex rel. Michael Jenkins as City Attorney for the City as plaintiff. The allegations of the FAC were substantially the same as in the original complaint. Respondent filed a new application for a TRO and preliminary injunction, with additional evidence. The following summarizes the evidence submitted in support of the TRO and preliminary injunction.

1. Original CUP Application

Respondent presented a copy of appellants’ 2003 application for a CUP for the Scribbles location and the minutes of the Planning Commission meeting at which it was approved. In the application, the owners of the property were identified as Ratan Hospitality and Patel; Astavakra, doing business as Scribbles, was identified as the “applicant.” The application stated that appellants proposed a “restaurant [with] liquor license, nightly jazz band or pianist [and] banquet facilities for community use.” Elsewhere, it described the project as a “family restaurant with liquor license, nightly live jazz music and banquet facilities with entertainment such as DJ [disc jockey], comedy, etc.”

The application indicated that Patel had written a letter on behalf of the applicant, but the letter was not attached to the copy in the record.

The minutes of the Planning Commission meeting indicated there had been a prior application by other parties -- obviously rejected -- to operate a nightclub on the premises. Because appellants’ project was “not labeled as a nightclub” and was “not proposed to activate [sic] as such, as was the former project,” the Planning Commission’s staff “d[id] not see the same issues.” In addition, the Planning Commission’s staff “attempted to write a variety of conditions that limit[ed] the activity [at Scribbles] to the D.J. and others that were mentioned.”

The minutes attached to the original application for a TRO and preliminary injunction indicated that Astavakra appeared at the meeting and stated that Scribbles was going to be “upscale dining with a jazz band playing” and that “there will be no D.J. music or any dancing except for private events if they want to dance -- like graduation parties or things like that. Otherwise there will be no dancing at all. Not even to the jazz band music. It is just going to be for entertainment purposes only.” This page of the minutes was omitted from the second application.

2. Original CUP

The CUP stated that appellants’ application “to allow a bar and entertainment in connection with an existing restaurant” was approved on conditions that included the following, numbered 5(j): “Entertainment shall only include a jazz band, guitarist and pianist and which shall occur on a small stage within the bar. Furthermore, a DJ with dancing shall only occur for banquets and private parties held within the banquet room.”

The CUP noted that “[a] restaurant use is permitted by right in this zoning district [Regional Commercial (C-3)]” but that “[a] bar and entertainment are permitted” only “with approval of a [CUP].”

3. Scribbles’ Operation Before CUP Modification

After operations commenced, the City and local law enforcement officials began to receive complaints from nearby residents and reports of criminal activity in the neighborhood of Scribbles. According to a declaration from Los Angeles County Sheriff’s Department Lieutenant Joe Maxey, who was responsible for overseeing deployment of deputies within the City, the following occurred from January 2004 through March 2006: (1) there were 67 patrol checks at or near Scribbles for loittering, loud music, fights, public urination and drinking alcohol in public; (2) the Sheriff’s Department received over two dozen calls reporting criminal activity occurring in the vicinity of Scribbles, including grand theft, sexual battery, vehicle theft, loud music, assault with a deadly weapon, and brandishing a deadly weapon; (3) “[o]n virtually every Thursday, Friday and Saturday night,” the Sheriff’s Department received complaints from nearby residents about loud music emanating from Scribbles; (4) nearby residents “experience[d] theft and vandalism of cars, drug dealing, and overt and public sexual activities”; (5) Lt. Maxey personally observed as many as 200 people waiting in line to enter Scribbles on Thursday nights; (6) Lt. Maxey personally observed persons entering Scribbles being charged an admission fee; and (7) when Scribbles closed at 2:00 a.m., the rush of people leaving created a traffic problem, and the large number of people congregating in nearby parking lots led to a noise problem. As a result of these occurrences, “the [Sheriff’s Department] deploys every available deputy to the business to focus on problems arising in and around Scribbles . . . Because those resources have to be focused on Scribbles, the rest of the community remains at will during this time . . . creat[ing] a public safety issue for the rest of the community.”

Respondent presented an example of Scribbles’ advertising in the form of a printout of a web advertisement referring to Scribbles as a “nightclub” and indicating that every Thursday, there would be a local radio personality or “DJ” playing dance music, including “Rockin’ Hip-Hop,” “Top 40,” and “Club Mix.”

4. Planning Commission Modification of CUP

On March 14, 2006 and April 11, 2006, the Planning Commission held public hearings to “review the operation” at Scribbles in order to “assure compliance with conditions of approval” and to “consider whether to modify, add conditions as necessary or revoke the permit.” Several City residents who lived near Scribbles appeared to register complaints, primarily about noise from music emanating from the location and patrons parking at a nearby condominium complex. One resident reported his vehicle had been vandalized and another reported 12 to 15 vehicle break-ins on a single Friday night.

Lt. Maxey and Sergeant Elizabeth Sachs appeared and made statements concerning the large number of people who patronized the club and the number of deputies assigned to the area to mitigate problems. Sgt. Sachs testified that she had witnessed several fights and injuries outside Scribbles in nearby parking lots.

Astavakra and Patel appeared a the April 11 hearing. Astavakra said he had not received any citations for exceeding capacity and had not heard of any complaints. He denied that he was running “just” a nightclub or violating the conditions of the CUP. He claimed the facility was “mostly” rented on Friday and Saturday nights. He offered to add to the security to prevent trespass at the condominium complex.

At the conclusion of the April 11 hearing, the Planning Commission adopted a resolution modifying the CUP “to prohibit any and all entertainment use” at Scribbles.

The findings on which the resolution was based included the following:

5. Appeal to City Council

Appellants appealed the Planning Commission’s decision to the City Council. On May 2, 2006, the City Council held a public meeting at which the appeal was addressed. The minutes of the hearing noted that Scribbles had been cited multiple times in the month since the Planning Commission’s action for continuing to present entertainment on Thursday nights. Lt. Maxey and Sgt. Sachs again appeared and gave statements concerning criminal behavior and other law enforcement problems encountered in the area of Scribbles, and the number of officers regularly deployed to the area. Many of the same neighborhood residents appeared and spoke of injuries they had suffered or problems they had encountered, again primarily noise and trespass by Scribbles’ patrons at the nearby condominium complex, but also including more serious charges such as a burglary, vehicle break-ins, public sex, and patrons leaving beer bottles and “used sex objects” behind. The residents were all in agreement that the business being operated at the location was, from all appearances, a nightclub that regularly offered musical entertainment on Thursdays, Fridays and Saturdays, rather than a restaurant that occasionally accommodated private parties. Several had seen flyers advertising Scribbles as a club or heard similar radio advertisements. One resident said he paid a visit to Scribbles, was charged $10 to enter, and observed people dancing to three different types of musical entertainment offered on three different performance stages.

Appellants and their attorney were given an opportunity to address the meeting. Astavakra denied that inappropriate activity occurred in or around Scribbles or that any problems were necessarily caused by its patrons. He claimed the website advertising was done by an unaffiliated company and had “nothing to do with Scribbles” and that DJ’s were hired by people who rented the facility. He admitted “[t]here are bands playing, and the bar is open and dancers perform.” Patel stated that he had invested hundreds of thousands of dollars in Scribbles based on the CUP. He said he had been advised that Scribbles could be operated as a “day club . . . or dance club” because it had an entertainment license. He did not believe Scribbles’ operations “[ever] crossed the boundary.” He said that if he heard of an invalid promotion “he trie[d] to track it down to tell [the promoter] not to advertise that way” and tried to ensure that Scribbles “was abiding by the CUP as he underst[ood] it.” He claimed that the Thursday night events were primarily “fraternity parties,” which he had arranged. Several patrons of the establishment appeared and testified favorably about their experiences at Scribbles, as did the head of the company that provided its security. None of the patrons specifically denied that Scribbles provided entertainment or that the entertainment offered exceeded the scope of the CUP.

At the conclusion of the meeting, the City Council adopted a resolution denying the appeal and affirming the action of the Planning Commission. The City Council concluded that the factual recitals in the Planning Commission’s resolution were true and concurred with the findings of the Planning Commission “that Scribbles is not operating in conformance with the approved [CUP], is a public nuisance, and is a threat to the health and safety of the community.” Accordingly, it denied the appeal.

6. Scribbles’ Operation After CUP Modification

Respondent presented evidence that after the actions of the Planning Commission and City Council banning all forms of entertainment, Scribbles continued to advertise and operate as a nightclub and the City continued to receive complaints from nearby residents. A website continued to show that entertainment such as “Hip Hop,” “Top 40,” and “Reggaeton” would be offered on Thursday, Friday and Saturday nights, and specifically stated that a “DJ” from a local radio station would be there on Friday, June 30. A flyer advertised “Drinco de Mayo” with live mariachi music and “the best DJ’s” from a local Spanish radio station on May 5. Another flyer advertised “Scribbles New Saturday Nights,” featuring “DJ’s” and various forms of music in three rooms. The advertisements continued to refer to Scribbles as a “nightclub” or “club” that offered many forms of music at various locations inside the structure.

C. Appellants’ Opposition

Other than a supplemental declaration from Patel denying management of Scribbles’ operations, appellants offered no factual opposition to the second application for a TRO and preliminary injunction. However, to ensure accurate representation of appellants’ position, we summarize the facts offered in opposition to the original TRO and preliminary injunction.

Astavakra, Patel, and their attorney submitted separate declarations in opposition to the original application for a TRO/preliminary injunction. Appellants established that the County of Los Angeles issued a business license that permitted Scribbles to operate as a restaurant with entertainment and dance. Astavakra denied that personalities from local radio stations were “regularly” invited to Scribbles to entertain on Thursday nights. He claimed that the flyer indicating a DJ from a local radio station would be playing dance music on Thursday nights “had been issued only once erroneously by a patron renting the restaurant for the evening and had been issued without his permission” and that “any entertainment is in conformance with the conditions of the CUP as Scribbles is rented for entertainment, in conformance with the CUP, for banquets and private parties.” He contended that any problems with public drinking were caused by underage patrons of nearby fast food restaurants. He further stated that he provided security for Scribbles and was willing to pay to have deputies on hand.

Patel described himself as “co-lessee and partner” in Scribbles. He said he and Astavakra had invested $900,000 in Scribbles. Both Patel and Astavakra stated that Scribbles’ continued existence required permission to offer entertainment and the opportunity for patrons to dance.

Appellants also submitted a number of declarations from patrons of Scribbles who stated it provided “good food and light entertainment” and denied it constituted a nuisance or that there were security or other problems. Three declarants said they regularly booked events and parties at Scribbles, but gave no specific dates or details concerning such events or parties. None of these declarants denied that Scribbles was providing entertainment outside the limits of the CUP.

After the second application for a TRO and preliminary injunction was filed, Patel submitted a supplemental declaration stating that he and Ratan Hospitality “are in no way involved with the ownership, management or operation of Scribbles”; that the real property on which Scribbles is located is owned by Ratan Hospitality which is “a limited liability company (‘LLC’)”; that he owns approximately 36 per cent of Ratan Hospitality; and that since December 17, 2003, another party has been Ratan Hospitality’s “managing member.” In February 2003, when Patel “was still the managing member for Ratan Hospitality,” he entered into a lease agreement on Ratan Hospitality’s behalf with Astavakra, under which Astavakra leased the Scribbles premises directly from Ratan Hospitality in order to operate Scribbles. Patel claimed to have no knowledge of problems arising from the operation of Scribbles.

Paragraph 16 of the lease stated: “Tenant shall not, and shall ensure that guests and licensees of Tenant do not, disturb, annoy endanger, or interfere with . . . neighbors, or use the Premises for any unlawful purposes, including, . . . violating any law or ordinance, or committing a . . . nuisance on or about the Premises.” Paragraph 20 stated: Tenant shall make Premises available to Landlord or Landlord’s agent for the purpose of entering to make inspections . . . .”

D. Trial Court’s Ruling

On August 22, 2006, the court issued a TRO prohibiting appellants from providing the following forms of entertainment at Scribbles: “a live DJ, a live performer, a live band, live music, recorded music, amplified music, . . . or video entertainment . . . .”

After further hearing, the court granted the request for a preliminary injunction. The preliminary injunction, dated October 26, 2006, prohibited the same forms of entertainment as the TRO. The court made the following express findings: (1) the CUP permitted appellants to operate a restaurant on the property but stated that “‘entertainment shall only include a jazz band, guitarist and pianist which shall occur on the small stage within the bar’” and that “‘a DJ with dancing shall only occur for banquets and private parties held within the banquet room’”; (2) the evidence submitted by respondent “show[ed] that the so-called ‘restaurant’ is being used to present musical entertainment by known artists, whose performances are advertised on local radio stations, and for which [appellants] charge admission”; and (3) “[t]he City Council, after a public hearing . . . found that such use of the premises constitutes a public nuisance because the performances, at which alcohol is served, attracts patrons who cause repeated disturbances of the peace when they leave the premises in the late evening or early morning hours.” The court concluded, based on the evidence presented by the parties, that respondent was likely to prevail on the issue whether appellants violated the CUP because “the CUP was issued to prohibit [appellants] from operating a nightclub on the premises and they are using the premises for precisely that purpose.”

With respect to the evidence, the court overruled appellants’ hearsay objections because “[d]eclarations are permitted to enable the court to determine whether the plaintiff or the defendants are likely to prevail on [the issue[s].”

The court described appellants’ legal contention that “owners of the leased premises are not responsible if the premises are used by a tenant in such a way as to constitute a nuisance” as lacking in merit because, under the facts presented, “the owners of the premises knew that their tenant was operating a nightclub on the premises in violation of the [CUP].” The court further concluded that an injunction prohibiting all forms of entertainment was not unreasonable under the First Amendment because “[t]he proposed injunction is content neutral, and therefore is not subject to strict scrutiny by the courts.”

DISCUSSION

A. Standard of Review

The issue in this appeal is whether the trial court erred in issuing the preliminary injunction. “The ultimate goal of any test to be used in deciding whether a preliminary injunction should issue is to minimize the harm which an erroneous interim decision may cause.” (IT Corp. v. County of Imperial (1983) 35 Cal.3d 63, 73.) “[A]s a general matter, the question whether a preliminary injunction should be granted involves two interrelated factors: (1) the likelihood that the plaintiff will prevail on the merits, and (2) the relative balance of harms that is likely to result from the granting or denial of interim injunctive relief.” (White v. Davis (2003) 30 Cal.4th 528, 554.) “[N]o hard and fast rule dictates which consideration must be accorded greater weight by the trial court. . . . [I]f it appears fairly clear that the plaintiff will prevail on the merits, a trial court might legitimately decide that an injunction should issue even though the plaintiff is unable to prevail in a balancing of the probable harms.” (IT Corp. v. County of Imperial, supra, 35 Cal.3d at pp. 72-73; accord, Common Cause of Cal. v. Board of Supervisors (1989) 49 Cal.3d 432, 447 [“[I]f the party seeking the injunction can make a sufficiently strong showing of likelihood of success on the merits, the trial court has discretion to issue the injunction notwithstanding that party’s inability to show that the balance of harms tips in his favor.”].)

“The party challenging an order granting or denying a preliminary injunction has the burden of making a clear showing of an abuse of discretion. [Citation.] An abuse of discretion will be found only where the trial court’s decision exceeds the bounds of reason or contravenes the uncontradicted evidence. [Citation.]” (Tahoe Keys Property Owners’ Assn. v. State Water Resources Control Bd. (1994) 23 Cal.App.4th 1459, 1470.) “Where the evidence with respect to the right to a preliminary injunction is conflicting, the reviewing court must ‘interpret the facts in the light most favorable to the prevailing party and indulge in all reasonable inferences in support of the trial court’s order.’” (Gleaves v. Waters (1985) 175 Cal.App.3d 413, 416-417, quoting Volpicelli v. Jared Sydney Torrance Memorial Hosp. (1980) 109 Cal.App.3d 242, 247.) When the matter raised on appeal is solely a question of law, the standard of review is not abuse of discretion “but whether statutory or constitutional law was correctly interpreted and applied by the trial court.” (Bullock v. City and County of San Francisco (1990) 221 Cal.App.3d 1072, 1094, quoting California Assn. of Dispensing Opticians v. Pearle Vision Center, Inc. (1983) 143 Cal.App.3d 419, 426.)

B. Evidence of Violation

There can be no dispute that violation of the terms of a CUP constitutes ground for the issuance of a preliminary injunction. (See, e.g., IT Corp. v. County of Imperial, supra, 35 Cal.3d at pp. 73-75.) Appellants do not contest the trial court’s factual finding that their “so-called ‘restaurant’” was “being used to present musical entertainment by known artists, whose performances are advertised on local radio stations, and for which [appellants] charge admission” -- i.e., that they were using the Scribbles premises for the purpose of operating a nightclub. Appellants argue instead that substantial evidence does not support that these activities violated the CUP. Appellants give two reasons for contending Scribbles’ operations did not violate the CUP: (1) “the CUP states on its face, at condition [5](j), that a DJ is permitted for the business”; and (2) “operating Scribbles with entertainment and general dance . . . is expressly permitted by the County of Los Angeles business licenses issued to Scribbles.” Alternatively, appellants contend the evidence in support of the application for the TRO and preliminary injunction consisted of hearsay, and that the countervailing evidence established that “Scribbles is an asset, not a liability to the community.” These contentions are either erroneous or irrelevant.

1. Condition 5(j) of the CUP

Appellants’ brief refers to the condition at issue as “4(j).” We presume that appellants intended to refer to condition 5(j), which is the only condition that contains any mention of a “DJ.”

Condition 5(j), of the CUP specifically provided that entertainment within Scribbles “shall only include” (1) “a jazz band, guitarist, and pianist . . . on the small stage within the bar” and (2) “a DJ with dancing . . . only . . . for banquets and private parties held within the banquet room.” Respondent offered evidence establishing that Scribbles regularly offered entertainment from bands and radio personalities or “DJs,” who played many types of popular dance music on three different stages and, on those occasions, offered entry to members of the general public. Whether this type of entertainment was permitted under the CUP was a question of law for the trial court (IT Corp. v. County of Imperial, supra, 35 Cal.3d at p. 74; Parsons v. Bristol Development Co. (1965) 62 Cal.2d 861, 865), which we review de novo (Bullock v. City and County of San Francisco, supra, at p. 1094).

Appellants’ contention that “the CUP states on its face . . . that a DJ is permitted for the business” ignores the limitations contained in the CUP. Permission to employ a DJ was expressly limited to private parties conducted in the banquet room. Additionally, entertainment was limited to “a jazz band, a guitarist and pianist . . . on a small stage within the bar.” Respondents presented uncontradicted evidence that Scribbles advertised itself as a “nightclub” not limited to private parties, with DJs playing dance music, and that on no fewer than three nights per week it offered multiple forms of musical entertainment not limited to the bar or the banquet room.

2. Los Angeles County Business License

Appellants suggest that the conduct at issue was authorized by their business license. The license they obtained from Los Angeles County authorized the licensee to “carry on the business or occupation specified.” Scribbles’ business was described on the license as “entertainment-gen. w/dance.” Appellants cite no authority for the proposition that receipt of a business license entitles the recipient to ignore zoning laws or the conditions of a CUP. Indeed, during the hearing at which the license was granted, the Business License Commission “assured all parties that any conditions and regulations previously set forth by any licensing requirement shall be enforced.” Moreover, we do not detect a true conflict between the license and the CUP. Scribbles was free to offer “entertainment-gen.” and “dance,” as long as it complied with the limitations set forth in condition 5(j) of the CUP. Appellants’ contention that the business license authorized them to offer music of any kind to the general public is unsupported.

As respondent points out, subsequent to the modification of the CUP and the filing of the complaint, the Business License Commission denied renewal of Scribbles’ license because “failure to comply with the [CUP] violate[d] both [the City’s] zoning ordinance and the conditions imposed on their business license issued in 2005,” and constituted “grounds for denial of the renewal.”

3. Hearsay

Appellants contend that almost all of respondent’s evidence in support of the application for the TRO and preliminary injunction consisted of hearsay. However, their brief identifies no specific evidence that should have been excluded on hearsay grounds, and appellants’ opposition to the second application for a TRO and preliminary injunction raised no hearsay objections. “In order to be able to claim error on appeal because of the erroneous admission of evidence, the record must show that appellant attempted to exclude such evidence at the earliest possible moment in the trial court.” (People ex rel. Dept. of Public Works v. Alexander (1963) 212 Cal.App.2d 84, 97; see Evid. Code § 353; People v. Demetrulias (2006) 39 Cal.4th 1, 20-21.) “The grounds of objection must be stated with reasonable certainty, and the objection must specify the particular evidence which is sought to be excluded.” (212 Cal.App.2d at p. 97.) By failing to raise such objection, appellants have forfeited it.

In any event, such objection would have lacked merit. As discussed above, respondent included a lengthy declaration from Lt. Maxey, who had personal knowledge of the matters he discussed.

4. Countervailing Evidence

Appellants emphasize certain evidence introduced to establish that Scribbles was an asset to the community -- the evidence that it provided extensive security, cooperated with law enforcement officials, and offered to pay the Sheriff’s Department for deployment of its deputies. As is typical of its efforts throughout this litigation, this represents an attempt to change the subject rather than address the issues. Appellants applied for and obtained a CUP permitting very limited types of entertainment at Scribbles. The City and its Planning Commission had already rejected a prior applicant who sought to operate the premises as a nightclub. The question was not whether appellants operated a well-run nightclub, but whether their management of the establishment complied with the limits of the CUP. The sole question properly before the court was whether Scribbles was being operated in violation of its CUP. (IT Corp. v. County of Imperial, supra, 35 Cal.3d 63.)

There was no real dispute that appellants openly violated the conditions of the CUP by bringing in radio personalities to play dance music and offering such entertainment to the general public. The fact that its patrons enjoyed the entertainment it offered does not detract from the fact that the type of business being operated at Scribbles was not permitted under the CUP. The entertainment was not limited to “a jazz band, a guitarist and pianist . . . on a small stage within the bar,” nor was dancing limited to “banquets and private parties held within the banquet room.” Because Scribbles provided entertainment outside the limits of the CUP, appellants were properly subjected to an injunction.

C. First Amendment

Appellants suggest that “modifying the CUP to eliminate all entertainment, instead of attempting to find alternative avenues of regulation. . ., raises serious First Amendment concerns.” As respondent points out, the United States Supreme Court has held that “the activity of these dance-hall patrons -- coming together to engage in recreational dancing -- is not protected by the First Amendment” and “qualifies neither as a form of ‘intimate association’ nor as a form of ‘expressive association’” as those terms have been defined. (Dallas v. Stanglin (1989) 490 U.S. 19, 25; see 7978 Corporation v. Pitchess (1974) 41 Cal.App.3d 42, 48 [governmental entity “could justifiably conclude that by reason of particular circumstances of noise and public congregation[,] the activities that accompany plaintiffs’ type of business [dance and entertainment] present special problems that require special regulation”].)

Moreover, even were there evidence of content-based regulation, “[z]oning laws can be used to regulate businesses which implicate the First Amendment.” (E.W.A.P., Inc. v. City of Los Angeles (1997) 56 Cal.App.4th 310, 318) A zoning law passes constitutional muster as long as its intent is to disperse certain types of businesses rather than eliminate them entirely or prevent new protected enterprises from entering the market place. (City of Whittier v. Walnut Properties, Inc. (1983) 149 Cal.App.3d 633, 640-642; see Neighborhood Action Group v. County of Calaveras (1984) 156 Cal.App.3d 1176, 1183-1184, quoting Van Sicklen v. Browne (1971) 15 Cal.App.3d 122, 126 [“‘[T]he traditional purpose of the conditions use permit is to enable a municipality to exercise some measure of control over the extent of certain uses . . . which, although desirable in limited numbers, could have a detrimental effect on the community in large numbers’”]; Smith v. County of Los Angeles (1989) 211 Cal.App.3d 188, 197-198, 203-206 [upholding denial of CUP to First Amendment protected business where CUP criteria were “designed to evaluate whether [proposed] use [was] compatible with the proposed location” and substantial evidence supported decision it was not].)

Appellants presented no evidence that the City used its zoning laws to prevent certain types of expression. Accordingly, neither the decision to limit entertainment uses under the original CUP or the decision to modify the CUP raised serious constitutional concerns.

D. Proper Parties

Ratan Hospitality and Patel contend that the preliminary injunction should not have been directed at them because “[r]espondent has provided no evidence that [they were] involved in the operation of Scribbles . . . .” Patel individually contends that as a holder of a minority ownership in Ratan Hospitality, his responsibility for Scribbles’ actions is even more attenuated.

Addressing the issue of landowner liability where injunctive relief is sought, the court in Leslie Salt Co. v. San Francisco Bay Conservation Etc. Com. (1984) 153 Cal.App.3d 605, held that the landowner’s liability and duty to take affirmative action “flow not from the landowner’s active responsibility for a condition of his land that causes widespread harm to others or his knowledge of or intent to cause such harm but rather, and quite simply, from his very possession and control of the land in question.” (153 Cal.App.3d at p. 622; see People v. Southern Pac. Co. (1957) 150 Cal.App.2d Supp. 831, 833 [“[O]wner or person in control of real property who has notice or knowledge that a continuing condition exists on such property which violates the . . . law and who thereafter fails to use reasonable care to abate such condition, is liable therefor in the same manner as the one who first created it.”].) That Ratan Hospitality owned the premises on which Scribbles was located was conceded by all. It was, therefore, subject to an injunction to halt the ongoing violation of the CUP.

With respect to Patel, in People v. Pacific Landmark, LLC (2005) 129 Cal.App.4th 1203, Division Three of this District examined the responsibility of those whose connection to a property on which a public nuisance is located flows from their involvement in a limited liability company. Under the applicable statute, “[w]hile generally members of a limited liability company are not personally liable for judgments, debts, obligations, or liabilities of the company ‘solely by reason of being a member’ (Corp. Code, § 17101, subd. (a)), they are subject to liability under the same circumstances and to the same extent as corporate shareholders under common law principles governing alter ego liability and are personally liable under the same circumstance and extent as corporate shareholders. (§ 17101, subd. (b) . . . .)” (129 Cal.App.4th at p. 1212, italics omitted.) The Limited Liability Company Act, “‘do[es] not relieve a member from liability arising from . . . the member’s tortious conduct . . . .” (Ibid., quoting 9 Witkin, [Summary of Cal. Law] (2004 supp.) Partnership, § 140, p. 329.) The same principle was applied to the defendant in Pacific Landmark, who was the manager of the limited liability company rather than a part owner or “member”: “[W]hereas managers of limited liability companies may not be held liable for the wrongful conduct of the companies merely because of the managers’ status, they may nonetheless be held accountable under Corporations Code section 17158, subdivision (a) for their personal participation in tortious or criminal conduct . . . .” (Id. at p. 1213, italics omitted.) It followed, the court held, that a manager (or member) would be personally liable to the extent he or she “ha[d] actual authority over, or significant responsibility for, the wrong.” (Id. at p. 1214.) The court concluded that the defendant manager was personally liable under the announced standard because of “his personal involvement in allowing the nuisance to persist” as evidenced by, among other things, the fact that he had “authority over the property where the nuisance [an illegal massage parlor] occurred,” “authorized counsel to appear at the meeting with the City’s attorney,” “leased the premises to [the operator],” retained the right to inspect the premises “to determine its compliance with the lease and all laws and ordinances,” and “failed . . . to inspect the premises to ascertain whether defendants had complied with the notice [to perform covenant by discontinuing the illegal use].” (Id. at p. 1216.) Under these facts, the manager “had the knowledge and the responsibility to prevent the nuisance” and was “not insulated from liability” by the Limited Liability Company Act. (Id. at p. 1217.) Therefore, “[t]he preliminary injunction was properly issued against [him].” (Ibid.)

Pacific Landmark makes clear that a member or manager of a limited liability company is not immune from personal liability for any judgment of a court -- including an injunction -- against the company. While a member or manager cannot be held liable merely because of his status, he is properly subject to an injunction where he had “actual authority over, or significant responsibility for” the action enjoined. (People v. Pacific Landmark, LLC, supra, 129 Cal.App.4th at p. 1214.) Here, Patel’s own conduct evidenced his knowledge of, and involvement in, the operations of Scribbles. He was the managing member of Ratan Hospitality responsible for negotiating the lease with Astavakra. That lease prohibited the tenant from disturbing neighbors, violating City ordinances or committing a nuisance, and gave the landlord the right to inspect the premises. Patel assisted Astavakra to obtain the CUP by writing a letter in support and appeared with Astavakra at the hearing to obtain the Los Angeles County business license. He appeared at the 2006 Planning Commission and City Council meetings at which the complaints about Scribbles were aired and defended Scribbles against the charges that it was operating in violation of the CUP. He claimed to have personally arranged private parties for Scribbles and to have made efforts to control its promotion and advertising. Finally, he submitted a declaration in opposition to the original application for a TRO and preliminary injunction in which he described himself as a “partner” with Astavakra in Scribbles and made sworn representations concerning Scribbles’ operations in an effort to defeat the application. On this record, he cannot deny involvement in Scribbles’ operations and is not insulated from liability by virtue of his status as a member of a limited liability company. The trial court did not err in including both Ratan Hospitality and Patel in the preliminary injunction.

DISPOSITION

The order granting the preliminary injunction is affirmed.

We concur: WILLHITE, Acting P. J. SUZUKAWA, J.

(1) “Circumstances have been changed by the applicant to a degree that one or more of the findings contained in the original permit can no longer be made and/or the public health, safety and welfare require the revocation or modification,” specifically “[t]he need for the deployment of additional Sheriff[’s] Deputies to handle the nuisance problems caused by the Thursday night entertainment is detrimental to public health, safety and welfare.” (2) “The permit was obtained by misrepresentation or fraud,” specifically, “[t]he applicant testified [in May 2003], that his business is an upscale restaurant and the entertainment he was requesting would be to allow a jazz band with no dancing at all except for private events like graduation parties within the banquet room. The type of entertainment on Thursday nights, which is advertised through known radio stations and having performance from known artists, and charging admission to these types of events, is inconsistent with the representation made by the applicant during the original [CUP] public hearing.” (3) “One or more of the conditions of the permit have not been met or have been violated,” specifically, “[c]ondition (j) . . . limits the entertainment to a jazz band, a guitarist or a pianist on a small stage within the bar, and a DJ with dancing for banquets and private parties held within the banquet room. The entertainment at Scribbles in the past is a violation of this condition. Condition (k) . . . states that the applicant shall not permit any public nuisance outside the restaurant including, but not limited to, unruly behavior by patrons which may contribute to noise. The nuisance problems demonstrated by Sheriff’s report are a clear violation of this condition.” (continued on next page) (4) “The improvement/use allowed by the permit has become detrimental to the public health, safety or welfare of the community or the use operates in a manner which constitutes a public nuisance,” specifically, “[t]he need to deploy additional Deputies to mitigate significant public safety issues at Scribbles and the continued pattern of significant public safety calls for services associated with patrons of Scribbles is detrimental to public health, safety and welfare of the community. The numerous public safety incidents occurring at this location negatively impacts the quality of life of nearby residents and businesses making the operation of this business a public nuisance.”


Summaries of

State ex rel. Jenkins v. Ratan Hospitality

California Court of Appeals, Second District, Fourth Division
Mar 20, 2008
No. B194660 (Cal. Ct. App. Mar. 20, 2008)
Case details for

State ex rel. Jenkins v. Ratan Hospitality

Case Details

Full title:STATE OF CALIFORNIA ex rel. MICHAEL JENKINS, as City Attorney, etc.…

Court:California Court of Appeals, Second District, Fourth Division

Date published: Mar 20, 2008

Citations

No. B194660 (Cal. Ct. App. Mar. 20, 2008)