Filed 7/9/14 Hill v. Appeals Bd. City of San Jose CA6
                      NOT TO BE PUBLISHED IN OFFICIAL REPORTS
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              IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                      SIXTH APPELLATE DISTRICT

JAMES C. HILL as Trustee, etc. et al.,                               H038406
                                                                    (Santa Clara County
         Plaintiffs and Appellants,                                  Super. Ct. No. 1-11-CV200857)

v.

THE APPEALS HEARING BOARD OF
THE CITY OF SAN JOSE et al.,

         Defendants and Respondents.


         By petition for writ of administrative mandamus (Code Civ. Proc., § 1094.5),
appellants James C. Hill et al. challenged Resolution 11-05 of Respondent Appeals
Hearing Board of the City of San Jose (Board), which declared a two-sided billboard
owned by appellants a public nuisance, ordered appellants to cease their operation of the
billboard, and imposed a $100,000 administrative penalty.1 On appeal, appellants
contend that the trial court erred in denying their petition because: (1) a conflict of
interest required the entire Board to recuse itself; (2) the evidence before the Board failed
to establish that the billboard was an illegal nonconforming use constituting a public
nuisance; and (3) imposition of a $100,000 fine was “improper.” For the reasons stated
here, we will affirm the judgment.




         1
             Unspecified statutory references are to the Code of Civil Procedure.
           I.   ADMINISTRATIVE AND TRIAL COURT PROCEEDINGS
       Appellants own and operate a two-sided billboard located adjacent to U.S.
Highway 101 on property owned by Respondent San Jose Family Housing Partners, L.P.
(SJFHP) in the City of San Jose.2 Appellants operate the billboard on an easement
recorded in December 2000.
       According to the administrative record before the Board, Leonard & Co., Inc.,
applied for a use permit in October 1969 to the County of Santa Clara (County) for the
“[e]rection of one 12’ x 48’ outdoor advertising display” on the subject property. At that
time, the property was located in an unincorporated part of the County. The County
Board of Supervisors issued a use permit in April 1970 for “an outdoor advertising
structure (12’ x 48’).” That use permit references file number 17P 69.7. A diagram that
also references file number 17P 69.7, dated April 1969 and referred to by the parties as
the “Mangold” diagram, shows a billboard supported by four pillars. Leonard & Co. also
obtained a building permit from the County in May 1970 for an “advertising sign (Free
Standing),” which likewise references file number 17P 69.7. The “inspection record”
area of the County building permit does not reflect the completion of any inspections
related to the billboard’s construction.
       In addition to County approvals, Leonard & Co., Inc., obtained an outdoor
advertising structure permit for the subject property in April 1970 from the California
Department of Public Works. The dimensions of the billboard listed in that state permit
called for a 14-foot by 52-foot display.




       2
          SJFHP participated in the administrative proceedings before the Board and
successfully intervened in the trial court. Appellants and SJFHP have been embroiled in
litigation since 2007 regarding the view impact of low-income housing constructed by
SJFHP on the subject property. (See Hill v. San Jose Family Housing Partners, LLC
(2011) 198 Cal.App.4th 764.)
       The record is unclear regarding exactly when the billboard was constructed,
though the parties agree that it was constructed within a few years after issuance of the
May 1970 County building permit. When originally constructed, and continuing to the
date the Board issued Resolution 11-05, the billboard was supported by two pillars. It is
also difficult to determine the original size of the display from the administrative record.
The County building permit authorized a 12-foot by 48-foot display while the state
permit authorized a 14-foot by 52-foot display. The only other evidence in the record
regarding the historical size of the billboard display comes from an excerpt from the
deposition testimony of Richard Mahlmann, which was attached to a letter submitted by
SJFHP to the Board. According to SJFHP’s letter, Mahlmann was deposed in 2008 as
one of appellants’ witnesses in a separate easement enforcement action against SJFHP.
In his deposition testimony, Mahlmann stated that in approximately 2006 he paid to
increase the size of the billboard from 14-feet by 48-feet to 18-feet by 48-feet.
       The City annexed the subject property in 1981. In 1985, the City prohibited the
construction of new billboards.
       In January 2009, the City’s code enforcement office began to investigate whether
appellants’ billboard was constructed without proper permits. After an internal
investigation and property inspections, the City issued a nuisance abatement cease and
desist order to appellants in April 2010. The cease and desist order recited that the
billboard was constructed “[i]n or about 1972” when the property was still located in an
unincorporated part of the County. The order alleged that the billboard was not
constructed in compliance with the 1970 County building permit and was expanded by
four feet in 2006 without any permits from the City. The order concluded that because
the billboard was not constructed pursuant to a permit, it was not a legal nonconforming
use when the property was annexed by the City in 1981 nor when the City banned new
billboards in 1985. The order instructed appellants immediately to cease and desist
“operation and maintenance of any and all billboards” on the subject property and
informed them that failure to comply with the order could result in the imposition of
administrative penalties.
       A Board hearing in September 2010 regarding the cease and desist order was
continued to allow appellants to apply for legal nonconforming status from the City’s
planning department. Appellants applied for legal nonconforming status in October 2010
based on the billboard having been constructed under a valid permit. In November 2010,
the City’s planning department denied appellants’ application for legal nonconforming
status via letter. The letter explained that because San Jose Municipal Code section
23.02.1010 prohibits billboards within the City, appellants would have to show “that the
billboard was legally established meeting all applicable codes, prior to July 26, 1985 [the
date the billboard prohibition was enacted].” The letter stated that despite the presence of
the County building permit, based on the permitting history of the subject property “there
is nothing to support that the billboard was legally constructed since there were no
inspections during construction.” Further, “[w]ithout a Final Inspection, the Building
Permit issued by the County of Santa Clara would have become null and void.” For these
reasons, the planning department concluded that “the subject billboard is not legal
nonconforming … .” (Emphasis omitted.)
       Following the City planning department’s determination that appellants’ billboard
was not a legal nonconforming use, the Board reconvened for a public hearing in January
2011. In response to questions from the Board, counsel for appellants disclosed that
appellants claimed the monthly revenue for one face of the billboard was between
$12,000 to $15,000 when they brought their easement enforcement action against SJFHP
and that although SJFHP’s housing units now block part of the billboard’s view, “it still
is generating a decent amount of money per month.” Counsel conceded that the
permitting record for the billboard contained a four-pillar diagram, which was not used
when constructing the actual billboard. Counsel also suggested that the Board had a
conflict of interest and should not decide this issue because the City “is substantially and
dramatically economically invested” in SJFHP’s low-income housing on the subject
property by virtue of providing loans and other funding for that project.
       After the close of public testimony, Board chair Overton stated: “I think our issue
is fairly narrow and that’s to determine whether this is really a legal billboard or whether
it is a public nuisance, basically, and, in my opinion, I think that even as far back as 1970,
this -- this billboard was illegal. I mean even … the first use permit that they got doesn’t
coincide with what’s actually there, it went from four-pillar to two-pillar and the size
changed, so … in my opinion, there’s not any competent evidence that this was ever a
legal billboard.” Similarly, Board member Hernandez reasoned: “If the structure had
been built as a four-tier, then we could move on to inspections and easements and
everything else that is being discussed, but the bottom line is the structure was built
illegally, it was not built according to the designs that were submitted and there is no
proof that anything was ever submitted intended [sic] as the structure is right now, so I’m
going to have to side with the City on this as well.”
       The Board approved Resolution 11-05, finding that “[s]ince the billboard is not a
legal nonconforming sign, its continued maintenance constitutes a public nuisance.” In
addition to ordering appellants to “immediately cease and desist the operation and
maintenance of any and all billboards” on the subject property, the resolution imposed a
$100,000 administrative penalty on appellants under San Jose Municipal Code section
1.13.150.
       Appellants challenged the Board’s decision by verified petition for writ of
administrative mandamus. (§ 1094.5.) After briefing, the court issued a tentative ruling
denying the petition and held a hearing in April 2012. At the conclusion of that hearing,
which lasted less than one day, the court adopted its tentative ruling and denied the
petition for writ of mandate. The court later signed a written order and entered judgment
denying the petition. The record does not reflect any request by appellants for a
statement of decision from the trial court at any point during the trial court proceedings.
Appellants timely appealed.
                                    II.    DISCUSSION
   A. CONFLICT OF INTEREST
       Appellants claim that the City had a conflict of interest regarding the
administrative enforcement action because SJFHP’s low-income housing on the subject
property was partially financed by loans from the City. Appellants further argue that this
alleged conflict of interest must be imputed to the Board. However, appellants’ claim is
not based on any legal authority. By citing neither legal authority nor reasoned analysis
applying that authority to the facts of the case, appellants have forfeited their conflict of
interest claim. (Tichinin v. City of Morgan Hill (2009) 177 Cal.App.4th 1049, 1084, fn.
16.)
   B. STANDARD OF REVIEW AND EFFECT OF NO STATEMENT OF DECISION
       Appellants claim the trial court erred by failing to articulate a standard of review
and not providing written findings of fact and conclusions of law to support its judgment
denying the petition. The Board and SJFHP claim the standard of review was “not
material” to the trial court’s review because the evidence supporting the Board’s decision
was “overwhelming.” The Board further argues that the trial court was not required to
issue a statement of decision because appellants did not request one. (Citing § 632.)
       Section 1094.5 provides two alternative standards of review for trial courts to
apply when reviewing a petition for writ of administrative mandate, “depending on the
nature of the rights involved.” (JKH Enterprises, Inc. v. Department of Industrial
Relations (2006) 142 Cal.App.4th 1046, 1057 (JKH Enterprises).) When the
administrative agency decision implicates a “ ‘fundamental vested right,’ ” the trial court
“exercises its independent judgment upon the evidence disclosed in a limited trial de
novo in which the court must examine the administrative record for errors of law and
exercise its independent judgment upon the evidence.” (Ibid., quoting Bixby v. Pierno
(1971) 4 Cal.3d 130, 143-144.) In all other cases, “the superior court’s review is limited
to examining the administrative record to determine whether the adjudicatory decision
and its findings are supported by substantial evidence in light of the whole record.” (JKH
Enterprises, supra, at p. 1057.)
       Regardless of which standard of review applies in the trial court, our standard of
review is always substantial evidence. (JKH Enterprises, supra, 142 Cal.App.4th at p.
1058.) When a fundamental vested right is implicated and the trial court exercises its
independent judgment, we review whether substantial evidence supported the trial court’s
judgment. When the proper standard of review in the trial court is substantial evidence,
our function is identical to that of the trial court and entails reviewing “the administrative
record to determine whether the agency’s findings were supported by substantial
evidence, resolving all conflicts in the evidence and drawing all inferences in support of
them.” (Ibid.) And where, as here, the petitioner fails to make a timely request for a
statement of decision from the trial court (§ 632), we “must infer any finding to uphold
the judgment that has substantial evidence in support in the administrative record[,]”
(Smith v. City of Napa (2004) 120 Cal.App.4th 194, 198-199 (Smith)), substantial
evidence being evidence that “is reasonable in nature, credible and of solid value.” (JKH
Enterprises, supra, at p. 1057.)
       Appellants argue that the trial court had a duty to issue written findings of fact and
conclusions of law regardless of their failure to request a statement of decision. Section
632 unequivocally states that “[i]n superior courts, upon the trial of a question of fact by
the court, written findings of fact and conclusions of law shall not be required.” While
findings of fact and conclusions of law are never required, a court must issue “a statement
of decision explaining the factual and legal basis for its decision … upon the request of
any party appearing at the trial.” (Ibid.) That request must be timely made “within 10
days after the court announces a tentative decision unless the trial is concluded within one
calendar day or in less than eight hours over more than one day in which event the
request must be made prior to the submission of the matter for decision.” (Ibid.; see also
California Rules of Court, rule 3.1590.)
         Section 632 applies in section 1094.5 administrative mandamus proceedings.
(Kazensky v. City of Merced (1998) 65 Cal.App.4th 44, 67; Milligan v. Hearing Aid
Dispensers Examining Com. (1983) 142 Cal.App.3d 1002, 1004, fn. 3.) Because
appellants did not request a statement of decision in the trial court, the court had no duty
to prepare one. Appellants’ reliance on Ocheltree v. Gourley (2002) 102 Cal.App.4th
1013, is misplaced. In Ocheltree, the court of appeal reversed the trial court’s denial of a
petition for writ of mandate because the trial court issued its decision before the
administrative record for the case was lodged. (Id. at pp. 1017-1018.) Because the court
reversed the judgment for that different and independently adequate reason, the court’s
passing statement that “if the trial court does not make such findings [on the material
issues in the petition] the judgment must be reversed” is non-binding dictum. (Id. at p.
1018.)
         Given appellants’ failure to request a statement of decision, our review is the same
regardless of the applicable standard of review in the trial court because where no
statement of decision is requested, we must infer any finding to affirm the judgment that
is supported by substantial evidence in the administrative record. (Smith, supra, 120
Cal.App.4th at pp. 198-199.) We therefore review the administrative record to determine
whether it contains substantial evidence to support the trial court’s denial of appellants’
petition.
   C. SUBSTANTIAL EVIDENCE SUPPORTS THE PUBLIC NUISANCE FINDING
         Appellants offer numerous reasons that purportedly support a finding that the
billboard is a legal nonconforming use. In chronological order, these reasons are as
follows: the 1970 County building permit was valid; that permit allowed a 14-foot by 48-
foot billboard; the billboard was constructed by a licensed contractor pursuant to that
permit; the construction is valid despite the lack of an inspection record because the
County did not require inspections in 1970; and any additions to the billboard’s display
size were temporary extensions authorized by the City’s municipal code.
       Regarding the 1970 County building permit, referencing file number 17P 69.7, we
agree that substantial evidence supports a finding that the permit was valid when issued.
However, that is where our agreement with appellants’ contentions ends. Simply stated,
appellants’ billboard is not the billboard contemplated by the file documents
accompanying the 1970 County building permit. The Mangold diagram, which
references file number 17P 69.7 in two locations, shows a billboard supported by four
pillars. Appellants do not contest that their billboard is and always has been supported by
only two pillars. Because the actual billboard on the ground does not correspond with the
billboard approved by the County when it approved the use and building permits in 1970,
substantial evidence supports the Board’s finding that the billboard is not a legal
nonconforming use and therefore constitutes a public nuisance. As Board chair Overton
aptly explained: “even … the first use permit … doesn’t coincide with what’s actually
there, it went from four-pillar to two-pillar and the size changed, so … there’s not any
competent evidence that this was ever a legal billboard.”
       Appellants now contend, for the first time on appeal, that the Mangold diagram
was “improperly placed” in file number 17P 69.7 and was actually the diagram for a
project at a different location with a different file number. Because appellants did not
make this argument before the Board, they are barred from raising the argument on
appeal for failure to exhaust their administrative remedies. (California Clean Energy
Committee v. City of San Jose (2013) 220 Cal.App.4th 1325, 1344 [“[I]ssues must be first
raised with the final decisionmaking authority if one wishes to seek judicial relief.”].)
Indeed, rather than contest the applicability of the Mangold diagram before the Board,
counsel for appellants conceded that appellants had not produced a two-pillar design and
that the only design in the record was the four-pillar Mangold diagram.
       Because we find that the Board’s decision, as well as the trial court’s denial of
appellants’ petition, was supported by substantial evidence in the administrative record,
we do not reach appellants’ additional arguments regarding the legality of their billboard.
   D. SUBSTANTIAL EVIDENCE SUPPORTS THE $100,000 ADMINISTRATIVE PENALTY
       Appellants essentially argue that there is no factual basis for the Board’s decision
to impose the $100,000 administrative penalty. The City responds that the $100,000
administrative fine was reasonable based on evidence that each display face of
appellants’ billboard generated between $10,000 and $15,000 per month in revenue.
       City of San Jose Municipal Code section 1.13.150 (section 1.13.150) allows the
Board to impose an administrative penalty of up to $100,000 to compel compliance with
nuisance abatement cease and desist orders.3 Section 1.13.150 lists factors the Board
may consider in determining the amount of the penalty, including the duration of the
public nuisance, the nature of the public nuisance, and the economic impact of the
penalty on the person or entity responsible for its payment. (§ 1.13.150(B).)
       According to Resolution 11-05, the $100,000 penalty reflects “approximately
$826.44 per day for 121 days of non-compliance with the Cease and Desist Order … .”
The testimony before the Board regarding the income generated by the billboard reflected
counsel’s recollection of the amount of income claimed by appellants in their easement
enforcement lawsuit against SJFHP. Counsel for SJFHP estimated the range of monthly
income at $10,000 to $15,000 for each face of the two-faced billboard. Counsel for
appellants stated that the monthly income was “in the area of 12 to $15,000 … for the
prime north face,” but that SJFHP’s housing development “obliterated” that view,
presumably reducing the monthly income; however, counsel conceded that the billboard
was still “generating a decent amount of money per month.” Appellants did not produce

       3
        Though the full text of section 1.13.150 was not included in the administrative
record, we take judicial notice of that section because it was before the Board when it
made its decision. (Evid. Code, §§ 452, subd. (b), 459.)
any direct evidence regarding the actual income generated by the billboards. In
discussing the amount of the fine, Board chair Overton stated: “I think that the income,
even though there was no direct testimony, the income for these billboards is fairly
significant. I think that based on that … we should go with the City’s recommendation of
the $100,000 in administrative penalties … .”
       Based on the record before it, the Board was entitled to assume that the income for
appellants’ billboard was between $20,000 to $30,000 per month ($10,000 to $15,000 per
face of the two-sided billboard). At roughly $25,000 per month for the 121-day window
identified in Resolution 11-05, the penalty was roughly equal to the income received by
appellants for the billboard during that period. Additionally, although section
1.13.150(C) states that penalties may only accrue from the date of service of the cease
and desist order, pursuant to section 1.13.150(B)(1) the Board could consider the duration
of the public nuisance in determining the amount of the fine. When the City’s
investigation began in 2009, appellants’ billboard had existed for close to 40 years and
had been an illegal nonconforming use constituting a public nuisance within the City
since at least 1985. That duration, along with the monthly income estimates and the lack
of contrary income evidence, provided substantial evidence to support the administrative
penalty.
                                   III.   DISPOSITION
       The judgment is affirmed.




                                          ____________________________________
                                          Grover, J.




WE CONCUR:




____________________________
Elia, Acting P.J.




____________________________
Mihara, J.
