Opinion
A147769
04-26-2017
MARK SHERMAN, Plaintiff and Appellant, v. CITY OF OAKLAND RENT ADJUSTMENT BOARD, Defendant and Respondent; DIANE MICHELSEN et al., Real Parties in Interest and Respondents.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Alameda County Super. Ct. No. RG15785257)
Mark Sherman appeals from an order denying his petition for writ of mandate against defendant City of Oakland Rent Adjustment Board (Rent Board). Sherman sought the writ to compel the Rent Board to set aside its decision granting his landlords an exemption from the Oakland rent adjustment ordinance. Sherman contends he did not receive a fair hearing and the findings in support of the exemption decision are not supported by the evidence. We affirm.
I. BACKGROUND
In December 2013, Sherman's landlords, Diane Michelsen and Harold Rus Michelsen, filed a petition with the Rent Board to obtain a certificate exempting his unit from Oakland's Residential Rent Adjustment Program Ordinance (rent ordinance). Sherman had been the Michelsens' tenant for 28 years.
Because they share the same surname, we refer to the Michelsens separately as Diane and Rus. We mean no disrespect in doing so.
During the proceedings, there was apparent confusion as to whether the Michelsens sought exemption for all four rental units in the building they owned or only Sherman's unit. The final decision applied only to Sherman's unit.
The Michelsens claimed their property was exempt because it qualified as "new construction." Oakland Municipal Code (OMC) section 8.22.030.A.5. provides the rent ordinance does not apply to "Dwelling units which were newly constructed and received a certificate of occupancy on or after January 1, 1983. . . . To qualify as a newly constructed dwelling unit, the dwelling unit must be entirely newly constructed or created from space that was formerly entirely non-residential." The Rent Board regulations state a "[l]ive/work space where the work portion of the space was converted into a separate dwelling unit" does not qualify for exemption. (Oakland Rent Adjustment Program Regs., § 8.22.030.B.2.c.i.) A. The Initial Hearing
At the hearing on their exemption petition, the Michelsens presented evidence Sherman's unit had been used as a commercial space until 1984, when it was converted to residential space. Diane testified the unit was vacant in 1982, when she first saw it. It had a toilet and two sinks, but no kitchen facilities or a shower. When she asked Rus about prior use of the property, he told her it had been rented as commercial property and was not residential property. Diane testified she was involved with management of the property in 1983, when the property was rented to an artist, who did not use it as a residence. After the artist moved out in 1984, Rus converted the property to residential space and received a certificate of occupancy in 1985.
Rus was unable to testify at the hearing but presented a declaration under penalty of perjury stating he purchased the building in 1974. Before he bought it, the property was used as a print shop. From 1976 to 1984, he rented it as a custom woodworking studio and then a custom art studio. He began converting the property to a live/work space in 1984 and received a certificate of occupancy in 1985. Sherman rented his unit in 1985—the first time the premises had been rented as a residence.
The Michelsens presented an e-mail from the City of Oakland's director of planning and building, Rachel Flynn, stating the property had been occupied by a publishing company starting in 1967, "but by the mid-80's, housing went into the structure." The Michelsens also submitted copies of the certificate of occupancy from 1985, permits they obtained in connection with the 1984 renovation, grant deeds reflecting ownership of the property, and a 1974 letter from the planning department about use of the space for custom manufacturing/sculpture work.
Sherman contested the exemption, appearing at the hearing without counsel. He argued the property was not exempt because a man named Charles Abraham had lived in his unit before 1983. Sherman introduced a letter purportedly signed by Abraham stating: "I Charles Abraham lived at 5823 Occidental St. Oakland Ca. 94608 during the years 1976, 1977, 1978." Sherman also presented pages from the Oakland phone book listing a "Chuck Abraham" at the Occidental address. When the hearing officer asked Sherman how he found Abraham, he testified Rus told him someone lived there previously. After looking in old telephone directories and online, Sherman located Abraham and contacted him. Abraham told Sherman he had lived in the premises for about five or six years with his daughter. When the hearing officer asked whether Abraham refused to testify, Sherman replied he had not asked him to do so.
In her written decision, the hearing officer found the subject property was not used for residential purposes prior to 1985, and the owners met the requirements for exemption by a preponderance of the evidence. She noted the Abraham letter presented by Sherman could not be authenticated, was not declared under penalty of perjury, and Abraham was not available for cross-examination. "Therefore," she determined, "this evidence cannot be considered as a proof that someone rented the subject property as a residence prior to January 1, 1983, and it is outweighed by the evidence submitted by the owners." B. Appeal to the Rent Board
Sherman appealed the hearing officer's decision to the Rent Board. In support of his appeal, Sherman filed a declaration describing his prior efforts to locate witnesses. Sherman referenced his conversation with Rus in which Rus told him a prior tenant, who had a woodworking business, lived in the unit and had built a loft for sleeping. Sherman looked through phone books and located listings for both Abraham and a Daniel Wiener at the Occidental Street address. Sherman found Abraham, but could tell he was reluctant to become involved and did not push him to come to the hearing. Though Sherman obtained a letter from Abraham, he did not realize it should be notarized or sworn under penalty of perjury.
Sherman's declaration also described his efforts to locate Daniel Wiener. Because the name was so common, Sherman had a hard time finding Wiener. He encountered no reference to Wiener's current address using Haines Criss-Cross Directory to search Oakland and Berkeley phone books and did not "turn up any promising leads" through Ancestry.com and Google searches. Sherman stated, "Each of the individuals I investigated was a dead end with no apparent link to my unit on Occidental Street." Sherman claims he was eventually able to locate the correct Daniel Wiener "through a lucky guess" while browsing the Internet in connection with his appeal. Sherman came across a Web site for Wiener, saw he had studied at University of California, Berkeley, and e-mailed him. Wiener responded affirming he had lived at the Occidental location in 1978.
In addition to his own declaration, Sherman also filed declarations from Abraham and Wiener, attesting under penalty of perjury each had lived in the unit prior to 1983. Abraham offered to testify in person.
At the July 2014 hearing, Sherman, now represented by counsel, argued the declarations from Wiener and Abraham showed the existence of critical new evidence not available at the time of the initial hearing. He asserted the matter should be remanded to give him an opportunity to present their declarations or testimony in aid of the exemption determination. Counsel also argued the hearing officer erred by failing to consider the Abraham letter. The appeal panel discussed whether the matter should be remanded to the hearing officer for consideration of additional evidence. A motion to remand was denied, and a motion to uphold the hearing officer's decision was seconded and approved. After further hearings, the Rent Board eventually issued a decision upholding the exemption. One panel member filed a dissent, arguing the matter should have been remanded to consider Sherman's additional evidence. C. Proceedings in the Trial Court
After the July 2014 hearing, the matter was remanded to the hearing officer to determine whether tenants in the other three units in the building had received notice of the proceedings and an opportunity to be heard on the petition for exemption. Sherman argued due process required he also be allowed to participate in remand proceedings, but his request to participate was denied. On remand, the hearing officer granted an exemption for the entire property, including the other three units in the building. Sherman appealed that decision as well. The remand decision was eventually vacated because the Rent Board determined the Michelsens had not petitioned to exempt the entire property and there was evidence the other units were not exempt.
Sherman filed a petition for writ of mandate in the superior court challenging the Rent Board's decision. He argued the hearing officer abused her discretion by failing to consider the Abraham letter and applying unequal standards to the parties' evidence. Sherman also asserted the Rent Board abused its discretion and denied him a fair hearing by failing to remand for consideration of the Abraham and Wiener declarations and not allowing him to participate in remand proceedings regarding the other three units. Finally, he claimed the Michelsens failed to meet their burden of proof under either the independent judgment or substantial evidence standard of review. The trial court denied the writ in its entirety.
II. DISCUSSION
After this matter was fully briefed, Sherman filed a request for judicial notice, asking the court to take judicial notice of (1) the Rent Board's hearing decision in Bell v. Tenants (2007, No. L07-0012), a case involving different parties under Oakland's rent ordinance; (2) the final statement of decision in a related case, Michelsen v. Oakland Rent Adjustment Board (Super. Ct. Alameda County, 2016, No. RG14-711450), involving the Michelsens' challenge to a prior Rent Board decision denying a proposed rent increase; and (3) a notice of changes to Oakland's Rent Adjustment Program and Just Cause for Eviction ordinances, all of which became effective after the trial court's entry of judgment in this matter. We take judicial notice of item one because it is unopposed and discussed briefly post. We take judicial notice of item two because it is unopposed, Sherman contends it is necessary to a complete record in light of what he claims are factual errors in the Rent Board's brief, and it is arguably relevant to whether this case involves a fundamental vested right. We decline to take judicial notice of the third item because it is not relevant to any issue properly presented to this court. (Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074, 1089, fn. 4.)
A party may seek a writ of administrative mandamus on the grounds an agency has acted in excess of jurisdiction, deprived petitioner of a fair trial, or committed a prejudicial abuse of discretion. (Code Civ. Proc., § 1094.5, subd. (b).) "Abuse of discretion is established if the [agency] has not proceeded in a manner required by law, the order or decision is not supported by the findings, or the findings are not supported by the evidence." (Ibid.) In this appeal, Sherman asserts his writ should have been granted because he was denied a fair hearing and because the agency's findings were not supported by the evidence. A. Whether Sherman Received a Fair Hearing
Sherman contends he was denied a fair hearing because (1) the hearing officer's application of the rules of evidence was not even-handed, (2) the Rent Board and trial court abused their discretion in refusing to remand for consideration of Sherman's additional evidence, and (3) he was denied his due process right to present evidence.
We review the trial court's factual findings with respect to whether a party received a fair hearing for substantial evidence, but the ultimate determination whether the administrative proceedings were fundamentally fair is a question of law we review de novo. (Nightlife Partners, Ltd. v. City of Beverly Hills (2003) 108 Cal.App.4th 81, 87 (Nightlife Partners); Clark v. City of Hermosa Beach (1996) 48 Cal.App.4th 1152, 1169-1170.)
1. Initial Hearing
Sherman claims he was denied a fair hearing because the hearing officer favored his landlords in her unequal application of the rules of evidence at the hearing. Specifically, Sherman argues the hearing officer "objected" to the form of his proffered evidence, but failed to object to or point out deficiencies in the Michelsens' evidence.
As an initial matter, the admission of evidence is within the sound discretion of the trial court, and a court may exclude inadmissible evidence on its own motion without any objection from a party. (San Lorenzo Valley Community Advocates for Responsible Education v. San Lorenzo Valley Unified School Dist. (2006) 139 Cal.App.4th 1356, 1420 [trial court's sua sponte evidentiary rulings did not exceed scope of its discretion]; People v. White (1954) 43 Cal.2d 740, 747; see 3 Witkin, Cal. Evidence (5th ed. 2012) Presentation at Trial, § 55, pp. 104-105, § 404, pp. 560-561.) It follows that an administrative officer, conducting a less formal proceeding (see Gov. Code, § 11513, subd. (c)), has similar authority. Contrary to Sherman's characterization, however, the hearing officer did not object to Sherman's evidence. She asked Sherman proper questions relevant to the weight of the evidence about how he found Abraham and whether he had refused to testify. The Michelsens' representative (not the hearing officer) then objected to the letter on the grounds it was not under penalty of perjury, was not authenticated, and contradicted Sherman's testimony at the hearing.
In any event, the record shows the hearing officer both admitted and considered all of Sherman's evidence. At the conclusion of the hearing, she stated, "I will certainly consider everything." Her written decision explicitly states she admitted as evidence both the Abraham letter and the phone book pages. Her ultimate conclusion that Abraham's one-line, unauthenticated letter was not "proof" of his residence and was outweighed by the Michelsens' evidence does not show she failed to consider it; rather it demonstrates, consistent with her adjudicatory role, she weighed Sherman's evidence and found it less persuasive.
We likewise reject Sherman's implicit contention the hearing officer demonstrated bias against him by not objecting to the Michelsens' evidence. It was not the hearing officer's responsibility to object to or comment on weaknesses in the Michelsens' evidence. Procedural due process in an administrative hearing requires an impartial, noninvolved administrative decisionmaker. (Nightlife Partners, supra, 108 Cal.App.4th at p. 90; Nasha v. City of Los Angeles (2004) 125 Cal.App.4th 470, 483.) The hearing officer's role as a neutral precludes her from acting as an advocate for either side. It was not her duty to raise objections to evidence or assist Sherman in arguing his case.
2. Refusal to Remand
Sherman also contends he was denied a fair hearing because the trial court and the Rent Board abused their discretion by refusing to remand the matter to the hearing officer for consideration of his additional evidence.
Sherman asserts the refusal to allow him to participate in remand proceedings regarding the other three units was an abuse of the Rent Board's discretion, but because this argument was raised for the first time on reply, we do not consider it. (Taylor v. Roseville Toyota, Inc. (2006) 138 Cal.App.4th 994, 1001, fn. 2 [it is improper to raise new contentions on reply].)
Code of Civil Procedure section 1094.5, subdivision (e) (section 1094.5(e)) permits remand of a matter to an administrative agency when it appears relevant evidence exists which, in the exercise of reasonable diligence, could not have been produced earlier or was improperly excluded at the hearing. (§ 1094.5(e); Windigo Mills v. Unemployment Ins. Appeals Bd. (1979) 92 Cal.App.3d 586, 598 (Windigo Mills).) "In the absence of a proper preliminary foundation showing that one of the exceptions noted in [section 1094.5(e)] applies, it is error for the court to permit the record to be augmented." (Pomona Valley Hospital Medical Center v. Superior Court (1997) 55 Cal.App.4th 93, 101.) Section 1094.5(e) "opens a narrow, discretionary window for additional evidence, newly discovered after the hearing (or improperly excluded at it)" and "generally has been limited to truly new evidence, of emergent facts." (Fort Mojave Indian Tribe v. Department of Health Services (1995) 38 Cal.App.4th 1574, 1595.) Whether one of the exceptions applies is a matter within the trial court's discretion and such discretion will not be disturbed unless it is manifestly abused. (Pomona Valley Hospital, at p. 101; Armondo v. Department of Motor Vehicles (1993) 15 Cal.App.4th 1174, 1180.)
Sherman also argues the Rent Board erred in applying its own regulation as the standard for admission of new evidence, rather than section 1094.5(e). This argument is forfeited because Sherman failed to cite authority in support of it and did not raise it with the trial court. (DP Pham LLC v. Cheadle (2016) 246 Cal.App.4th 653, 674 [party forfeits legal argument by failing to adequately support it with relevant legal authority]; Children's Hospital & Medical Center v. Bontá (2002) 97 Cal.App.4th 740, 776 [appellate court will not consider procedural defects or erroneous rulings where error could have been, but was not, raised in the court below].) Regardless, as explained below, there was no abuse of discretion in refusing to remand for consideration of the evidence under section 1094.5(e).
The finding by the trial court (and implied finding by the Rent Board) that Sherman failed to exercise due diligence is supported by substantial evidence. Sherman concedes the evidence as to Charles Abraham was not new. Before the initial hearing, Sherman had already identified Abraham and obtained a letter from him, which was admitted as evidence. He could have as easily obtained a declaration under penalty of perjury or asked Abraham to testify. Sherman argues he understood the importance of evidence of Abraham's tenancy but because he was in pro. per. he did not know how to properly present it. But Sherman offers no authority, and we are aware of none, that self-represented parties do not have to meet the due diligence requirement. (See Kobayahsi v. Superior Court (2009) 175 Cal.App.4th 536, 543 ["Pro. per. litigants are held to the same standards as attorneys."].)
Sherman contends the Abraham declaration was "improperly excluded," but he does not develop this argument. In any event, the Abraham declaration was not obtained until after the initial hearing had taken place, so it was not excluded from that hearing.
As to Daniel Wiener, Sherman's declaration of due diligence was vague and nonspecific. Sherman knew about Wiener before the initial hearing from locating his name in the phone book. Though he claims it was very difficult to find Wiener because his name is so common and the time before the hearing was so short, the only efforts he made to locate him were searches in an online phone directory and two other electronic database searches. There are no details in Sherman's declaration about the amount of time these searches took or how many individuals named "Daniel Wiener" Sherman investigated. Sherman's assertion he was eventually able to find Wiener through his public Web site based on a "lucky guess" after the initial hearing does not show he made every reasonable effort to find Wiener. (Windigo Mills, supra, 92 Cal.App.3d at p. 595, citing Akopiantz v. Board of Medical Examiners (1961) 190 Cal.App.2d 81, 93 [a litigant must "exhaust every reasonable effort to produce at his trial all existing evidence in his behalf"].) In sum, there was substantial evidence to support the trial court's finding the Wiener declaration was not new evidence that could not, in the exercise of reasonable diligence, have been presented at the hearing.
Sherman argues the trial court's decision not to admit his evidence conflicts with the policy favoring trial on the merits, citing to Key System Transit Lines v. Superior Court (1950) 36 Cal.2d 184. Sherman's reliance on that authority is misplaced. In Key System Transit Lines, the court exercised its discretion to set aside a prior order of dismissal for failure to prosecute based on its own mistake. (Id. at p. 188.) Noting the policy of finality of judgments generally controls where judgment is entered after trial on the merits, the court observed the "policy has not been deemed controlling where the judgment or order set aside was in the exercise of a discretionary power not based on the merits of the action." (Id. at p. 187.) Here, Sherman received a decision on the merits so there is no conflict between the policies favoring trial on the merits and finality of judgments.
"Section 1094.5 was designed to give great deference and respect to administrative orders and findings. It sets narrow limits on a party's ability to obtain a new administrative hearing, and part of those limits include narrow restrictions on discovery and augmenting the administrative record." (Pomona Valley Hospital, supra, 55 Cal.App.4th at p. 109.) Because Sherman failed to demonstrate he could not have found Wiener through the exercise of reasonable diligence prior to the initial hearing, he has not shown he was entitled to have the matter remanded for further consideration of his evidence. Accordingly, the trial court's and the Rent Board's decisions not to remand were not abuses of discretion and did not violate his right to a fair hearing.
3. Right to Present Evidence
Sherman asserts he was "effectively prevented from presenting his case" because the Rent Board at the July 2014 hearing refused to remand the matter to the hearing officer to allow him to present additional declarations or testimony obtained after the initial hearing. Sherman claims he had a right to present evidence under Government Code section 11513 and the Rent Adjustment Program Regulations, and the Rent Board's refusal to remand denied him due process.
We reject Sherman's argument because the only evidence he was precluded from offering was evidence developed after his initial hearing. It is undisputed Sherman had an opportunity to present evidence at his first hearing. As discussed above, with regard to new evidence obtained posthearing, Sherman must show such evidence could not, in the exercise of due diligence, have been produced earlier. (§ 1094.5(e).) Because Sherman failed to demonstrate due diligence, he was not entitled to present the additional declarations or further testimony from Abraham.
Although he contends the Rent Board's refusal to remand constitutes reversible error per se under the authority of Sinaiko v. Superior Court (2004) 122 Cal.App.4th 1133 and Kelly v. New West Federal Savings (1996) 49 Cal.App.4th 659, those cases are inapposite. In Sinaiko, a medical doctor was denied a fair hearing when an administrative law judge disqualified all medical experts who had testified on his behalf in a licensing revocation proceeding. (Id. at pp. 1138-1139, 1141-1142.) In Kelly, the trial court abused its discretion by granting motions in limine before trial that effectively prevented the plaintiffs from offering evidence to establish their case. (Id. at p. 677.) Neither case considered whether the matter should be reopened or remanded for presentation of new evidence after initial proceedings had concluded.
Sherman also argues his hearing was unfair because the Rent Board failed to follow a prior decision in Bell v. Tenants (2007, No. L07-0012), a 2007 Rent Board case involving a landlord's application for exemption from the rent ordinance based on rehabilitation of his property. We reject this argument for several reasons. First, Sherman did not provide authority the Rent Board is bound by its prior decisions until his reply brief. (Taylor v. Roseville Toyota, Inc., supra, 138 Cal.App.4th at p. 1001, fn. 2.) Second, the record provided is inadequate to allow us to determine whether the Rent Board's decision in Bell was inconsistent as Sherman argues. (See Wagner v. Wagner (2008) 162 Cal.App.4th 249, 259 [appellant forfeits claim by failing to provide adequate record to permit review].) There, the Rent Board remanded for the landlord to produce new evidence, but its reasoning is not clear from its brief decision. Finally, to the extent we can determine, Bell appears to be distinguishable. The landlord in Bell sought a different exemption, the appeal was uncontested by the tenants, and the Rent Board may have accepted the landlord's argument he should be given an opportunity to present new evidence because "many records were no longer available" by the time the petition was filed. Here, whether Sherman had presented new evidence was strongly disputed by his landlords, and Sherman failed to show his additional evidence was unavailable at the time of his hearing.
Requiring Sherman to demonstrate due diligence before he is allowed to present new evidence after the initial hearing does not violate due process. (See Redevelopment Agency v. Tobriner (1989) 215 Cal.App.3d 1087, 1096-1097 [order precluding landowners from offering new valuation evidence at second trial did not violate due process when they failed to comply with applicable procedural and evidentiary rules]; People v. Brown (2003) 31 Cal.4th 518, 545 [the "routine application of state evidentiary law does not implicate a defendant's constitutional rights"].) Sherman has not shown a violation of his right to present evidence. B. Sufficiency of the Evidence
As to the sufficiency of the evidence supporting the hearing officer's factual findings, Sherman makes two claims. First, he argues the trial court should have exercised its independent judgment because exemption of the property under the rent ordinance affects a fundamental vested right. Second, he contends the findings were not supported by substantial evidence.
1. Standard of Review
In reviewing an administrative agency's decision under Code of Civil Procedure section 1094.5, the trial court uses one of two possible standards of review, depending on the nature of the right involved. (JKH Enterprises, Inc. v. Department of Industrial Relations (2006) 142 Cal.App.4th 1046, 1056-1057 (JKH Enterprises).) If the administrative decision affects a fundamental vested right, the trial court exercises its independent judgment on the evidence. (Goat Hill Tavern v. City of Costa Mesa (1992) 6 Cal.App.4th 1519, 1525.) If the agency's decision does not involve or affect a fundamental vested right, the trial court determines whether the agency's findings are supported by substantial evidence in light of the whole record. (Id. at pp. 1525-1526.) On appeal, we apply a substantial evidence standard of review regardless of the applicable standard of review in the trial court. (JKH Enterprises, at p. 1058.)
Whether an administrative decision substantially affects a fundamental vested interest is decided on a case-by-case basis. (Bixby v. Pierno (1971) 4 Cal.3d 130, 144.) "In determining whether the right is fundamental the courts do not alone weigh the economic aspect of it, but the effect of it in human terms and the importance of it to the individual in the life situation." (Ibid.) As a general rule, courts are less likely to find a fundamental vested right when a case involves or affects purely economic interests. (JKH Enterprises, supra, 142 Cal.App.4th at p. 1060.) "The ultimate question in each case is whether the affected right is deemed to be of sufficient significance to preclude its extinction or abridgement by a body lacking judicial power." (Interstate Brands v. Unemployment Ins. Appeals Bd. (1980) 26 Cal.3d 770, 779, fn. 5.)
The right involved in this case is economic in nature. The Rent Board's determination Sherman's unit is exempt under the rent ordinance primarily concerns the amount of rent he can legally be required to pay. Sherman claims the rent ordinance provides "many other benefits" beyond protection from rent increases, including petition and hearing rights to challenge disputed rent increases or exemptions and a right to petition for a decrease in rent due to substandard housing conditions. These benefits, however, involve procedures for determining the amount of his rent.
Indeed, Sherman asked us to take judicial notice of the trial court's final decision in the related case, Michelsen v. Oakland Rent Adjustment Board (Super. Ct. Alameda County, 2016, No. RG14-711450), concerning the Michelsens' appeal of the Rent Board's decision to deny their proposed rent increase. The trial court's final decision, after examining the effect of the exemption determination, sets forth a detailed accounting of the amount of rent due. The court's analysis further supports our conclusion the primary impact of the exemption is a change in the amount of rent Sherman owes for his unit.
Moreover, while the rent ordinance provides a mechanism for tenants to petition for a decrease in rent based on substandard housing conditions (OMC, § 8.22.090), Sherman presents no specific evidence or argument regarding the importance of such a right to him.
Courts have consistently declined to find a fundamental vested right in cases involving rent stabilization ordinances. (See MHC Operating Limited Partnership v. City of San Jose (2003) 106 Cal.App.4th 204, 218; San Marcos Mobilehome Park Owners' Assn. v. City of San Marcos (1987) 192 Cal.App.3d 1492, 1500; Concord Communities v. City of Concord (2001) 91 Cal.App.4th 1407, 1414.) While the majority of such cases concern denial of a property owner's attempt to increase rent, they are persuasive authority the amount charged for a rental unit is an economic interest. In one case brought by tenants of a mobilehome park challenging their landlord's rent increase, Robinson v. City of Yucaipa (1994) 28 Cal.App.4th 1506, the court observed the propriety of approval of a rent increase is "a question of fact subject to review under the substantial evidence standard." (Id. at p. 1517.) Though arguably dicta, Robinson is consistent with the view rent control ordinances do not involve fundamental vested rights.
Acknowledging some of these authorities, Sherman contends his interest is different from his landlords' interest because whether he is eligible for protection under the rent ordinance affects not just the amount of rent charged, but "whether, and under what terms, he may continue to reside in his home." He cites language in the purpose and findings of the rent ordinance stating: "The present shortage of rental housing units and the prevailing rent levels have a detrimental effect on the health, safety, and welfare of a substantial number of Oakland residents, particularly senior citizens . . . and persons on fixed incomes. Stability in their housing situation is important for individuals and families in rental housing. In particular, tenants desire to be free from the fear of eviction motivated by a rental property owner's desire to increase rents." (OMC, § 8.22.010.A.)
General statements in the preamble to an ordinance regarding "health, safety, and welfare," "stability in housing," and "fear of eviction," however, say nothing about Sherman's particular circumstances and the importance of the alleged right in his own life. (See Quintana v. Board of Administration (1976) 54 Cal.App.3d 1018, 1023 [in case-by-case analysis to determine whether administrative decision affects fundamental vested rights, "trial court must consider the nature of the right of the individual that will be substantially affected by the action of the administrative agency"]; Benetatos v. City of Los Angeles (2015) 235 Cal.App.4th 1270, 1281-1282 [restaurant owners' claim operating conditions imposed by city would impair their ability to function or put them out of business was based solely on their own unsupported conclusions]; cf. Goat Hill Tavern v. City of Costa Mesa (1992) 6 Cal.App.4th 1519, 1529 [court found business had fundamental vested interest to continue operating established business based on "unique" facts of case presented by owner].) The only evidence Sherman offered as to his own situation is a declaration provided to the trial court with his reply brief stating he is 73 years old, lives on a fixed income, and has "periodically reviewed sources of information about rental rates at apartments offered for rent in Oakland. Based on this information [he believes he] would be unable to continue residing in Oakland if [he] were required to pay present market level rent." His conclusory statement is lacking in relevant detail and says nothing specific about why he would be required to pay market level rent, how his current rent compares to market rental rates, or why Sherman claims the loss of protection under the ordinance "will have a major impact [on] how he will live in the coming years."
Sherman also contends he has a possessory interest in his real property and protection under the ordinance concerns his right to be free from arbitrary evictions. Specifically, he cites to OMC section 8.22.300, Oakland's Just Cause for Eviction Ordinance, "another tool employed by the City of Oakland to protect tenants and provide for stability in rental housing." The Just Cause for Eviction Ordinance, however, is a separate ordinance not at issue in the agency's exemption determination here. (OMC, § 8.22.030.A. [stating exemptions are applicable to Residential Rent Adjustment Program Ordinance only and noting Just Cause for Eviction Ordinance and Ellis Act Ordinance have different exemptions].) Moreover, Sherman has not presented any evidence regarding a pending or threatened eviction. The court will not find a fundamental vested right based on a hypothetical threat of retaliatory eviction.
The parties also debate whether the right to protection under the rent ordinance was vested. Because we find the right is not fundamental in nature, however, it unnecessary to decide that issue. (See Bixby v. Pierno, supra, 4 Cal.3d at p. 144 [court must consider whether right is fundamental, and if so, whether it is vested or merely sought by individual].) The trial court appropriately applied the substantial evidence standard of review.
2. Substantial Evidence
Finally, Sherman urges even under the substantial evidence standard of review, the Rent Board abused its discretion because the Michelsens' evidence is insufficient to support the agency's determination the property was not used as a residence prior to 1983.
When, as here, the trial court correctly applied the substantial evidence standard of review, we determine whether the agency's findings are supported by substantial evidence, resolving all conflicts in the evidence and drawing all inferences in support of them. (JKH Enterprises, supra, 142 Cal.App.4th at p. 1058.)
The evidence adduced at the initial hearing was sufficient to support the hearing officer's finding the property was not used for residential purposes prior to 1983. Rus presented a sworn, notarized declaration stating he rented the space for commercial use of the premises from the time he purchased it in 1974 through 1985, and the premises were not rented for residential purposes during that time. Documents showing the City of Oakland Planning Department provided guidance about use of the unit for custom manufacturing (sculpture) activity in 1974, Rus obtained permits in 1984 and 1985 for renovation, and Rus received a certificate of occupancy in 1985, are consistent with facts stated in Rus's declaration regarding use of the property. Diane testified in person at the hearing regarding the condition of the property and its lack of fitness for residential purposes based on her personal observation in 1982. She also testified to the efforts to convert the property to residential space in 1984 and 1985. The e-mail from the Oakland director of planning and building regarding conversion of the property for residential purposes in the mid-80's, though hearsay, supported the hearing officer's finding the property was not used for residential purposes before 1983.
Sherman contends the hearing officer's reliance on Rus's declaration was unreasonable because he does not state unequivocally no renters lived at the property during his entire ownership prior to issuance of the certificate of occupancy. Though it is true his declaration states he did not rent the property for residential purposes, the hearing officer could reasonably infer the premises were not used for residential purposes.
Hearsay evidence may be used in an administrative hearing for the purpose of supplementing or explaining other evidence. (Gov. Code, § 11513, subd. (d).) Moreover, Sherman did not object to the e-mail at the initial hearing. --------
It is true Sherman presented conflicting evidence, but the hearing officer considered it and found it was outweighed by the Michelsens' evidence. This was not unreasonable. The Abraham letter comprised a one-line, conclusory sentence and was not notarized or given under penalty of perjury. As the trial court observed, the phone book pages were ambiguous evidence because they contain both residential and commercial listings, making it difficult to determine whether the reference to "Chuck Abraham" at the Occidental Street address was a business or personal reference. Finally, though Sherman testified Rus told him someone had lived in the unit before, the existence of contradictory evidence is not sufficient to overturn the agency determination. (See Jackson v. City of Pomona (1979) 100 Cal.App.3d 438, 451 ["It is obvious that there can be substantial evidence to support findings either way on issues as to which evidence is conflicting."].)
On review of an agency's administrative decision, it is not our function to reweigh the evidence. (Donley v. Davi (2009) 180 Cal.App.4th 447, 456.) Drawing all inferences in favor of the hearing officer's findings of fact, there was substantial evidence supporting the determination the property was not used for residential purposes prior to 1983, and accordingly, Sherman has not shown the agency abused its discretion.
III. DISPOSITION
The order denying the petition for writ of mandate is affirmed. Respondents Rent Board and Diane and Harold Rus Michelsen are entitled to costs.
/s/_________
Margulies, Acting P.J. We concur: /s/_________
Dondero, J. /s/_________
Banke, J.