City of Corona v. Naulls

• Decision Date: 30 July 2008
• Docket Number: No. E042772.,E042772.
• Citation: 83 Cal. Rptr. 3d 1,166 Cal.App.4th 418
• Court: California Court of Appeals Court of Appeals
• Parties: CITY OF CORONA, Plaintiff and Respondent, v. RONALD NAULLS et al., Defendants and Appellants.

166 Cal.App.4th 418

83 Cal. Rptr. 3d 1

CITY OF CORONA, Plaintiff and Respondent, v. RONALD NAULLS et al., Defendants and Appellants.

No. E042772.

Court of Appeals of California, Fourth District, Division Two.

July 30, 2008.

Ackerman, Cowles & Lindsley, Richard D. Ackerman, Michael W. Sands; Law Offices of James Anthony and James Anthony for Defendants and Appellants.

Best, Best & Krieger, Jeffrey V. Dunn, Dean Derleth and Marc S. Ehrlich for Plaintiff and Respondent.

OPINION

MILLER, J.

The trial court issued a preliminary injunction preventing Ronald Naulls and his business enterprise, Healing Nations Collective (HNC), a medical marijuana dispensary operating within the City of Corona (the City), from conducting any further operations. The court found that, because HNC was "operating as a non-permitted, non-conforming use," its operation "constitutes a nuisance per se, which the City may abate by seeking injunctive relief in this Court." On appeal, Naulls and HNC challenge the sufficiency of the evidence to support the order, contending the court's finding as to "non-permitted, non-conforming use" is based on a faulty legal premise. We affirm.¹

FACTUAL AND PROCEDURAL BACKGROUND

Naulls is president and chief executive officer of HNC, a California mutual benefit nonprofit corporation. On May 2, 2006, Naulls applied for a business license to operate HNC as a new business in the City. The City uses a preprinted form which states, in red text, the following: "The City of Corona Municipal Code requires that all businesses pay a business tax, but such payment does not authorize an applicant to do business in the City. All Businesses must comply with all city codes and must have the Department of Planning approval prior to opening." In the portion of the license application calling for a description of the proposed business activity, Naulls penned, "Misc. Retail." Naulls signed the application, declaring under penalty of the laws of California that the information provided was true and correct.

Before submitting his application, Naulls visited the City's business license department and spoke with Carol Warfield, a customer service representative. According to Warfield, although the application does not enumerate the types of businesses eligible for licensure, the City expects the applicant to truthfully describe the nature of his or her business in the space provided. In response to Warfield's inquiry as to the type of business he was planning on operating, Naulls said that he would be opening a "`miscellaneous retail' establishment" and would be selling "`miscellaneous medical supplies.'" Warfield reviewed the application and, based upon the information provided, issued Naulls a receipt, which served as a temporary business license. She would not have issued a business license to Naulls had she known that the true nature of HNC's operations was "to cultivate, store, sell and distribute marijuana."

On June 20, 2006, Naulls telephoned the City's planning director, Peggy Temple, to schedule a meeting "regarding establishing a business in the City." At first reluctant to respond to Temple's inquiry as to the nature of the business, Naulls eventually admitted that he operated a medical marijuana establishment. At their meeting two days later, Temple informed Naulls that marijuana dispensaries were not, and never have been, a permitted land use under the City's zoning laws. Temple also then informed Naulls that, at a special meeting held the day before, the City had enacted a moratorium on medical marijuana dispensaries. Naulls admitted that prior to opening his dispensary he was informed by a planning department employee that the proposed use was not permitted and that, in the event he proceeded to open the business, he would be subject to law enforcement.

On July 7, 2006, legal counsel for the City wrote to Naulls informing him that, among other things, the City had imposed a moratorium on the establishment of medical marijuana dispensaries. Further, because HNC had been established unlawfully, it was not exempt even though its application had already been filed. Naulls was directed to cease distributing marijuana, either from his business or otherwise. In a letter dated July 14, 2006, Naulls's attorney referenced a telephone conversation with the City's counsel, reiterating his position that "the clinic is a prior legal non-conforming use. If you are aware of any authority supporting the position that anything not permitted under the zoning code is therefore prohibited, please make me aware of it."

On August 8, 2006, counsel for the City replied, informing Naulls's attorney that HNC's business license was invalid because he had falsified his application, medical marijuana dispensaries were not a permitted use under the City's municipal code and Specific Plan, and HNC failed to comply with the procedures required for establishing a "similar use" zoning designation. Naulls was again directed to cease and desist from operating HNC.

The following day, the City filed the underlying lawsuit, alleging that HNC's operation constituted a public nuisance in violation of Civil Code section 3479. Specifically, the City alleged that use of the premises at which HNC was operating was a nuisance per se under section 1.08.20 of the City's municipal code in that Naulls operated HNC in contravention of sections 5.02.030 (pertaining to business licenses) and 5.02.370, subdivision (B) (pertaining to zoning regulations). The City sought a temporary restraining order to close down HNC's operations, and preliminary and permanent injunctions to prevent use of the premises pending submission of a new business license application and compliance with all federal, state, and local laws.

At a hearing in August, the court denied the City's ex parte application for a temporary restraining order, but set a hearing for September 28, 2006, regarding the City's request that a preliminary injunction issue. Having directed the City to file a new motion, the court remarked it "think[s] there is some probability of a preliminary injunction issuing." The hearing on the City's request for a preliminary injunction was eventually continued, and on October 4, 2006, Naulls filed his answer to the complaint.

In late October, the City filed its motion for a preliminary injunction, asserting various grounds, i.e., (1) notwithstanding the passage of the Compassionate Use Act of 1996 (CUA; Health & Saf. Code, § 11362.5) and the Medical Marijuana Program Act (MMPA), Naulls was operating HNC in violation of the Controlled Substances Act (CSA), as interpreted in Gonzales v. Raich (2005) 545 U.S. 1 [162 L.Ed.2d 1, 125 S.Ct. 2195], and (2) Naulls's continued operation of HNC violated provisions of the City's municipal code and Specific Plan with regard to its application for business license and zoning regulations and thus constituted a nuisance per se.

In a declaration in support of the City's motion, Temple alleged that because a medical marijuana dispensary was not a permitted use in any of the zoning areas within the Specific Plan, any other specific plan,² or any of the code's zoning provisions, Naulls would have been required to amend the Specific Plan to include his requested use. She asserted: "In order to obtain an amendment of the Specific Plan, Mr. Naulls would be required to submit the requested revisions to the Specific Plan document concerning the location of Healing Nations to the City, submit documentation demonstrating that the owner of the property where Healing Nations is located authorized the requested changes to the Specific Plan, submit development standards applicable to the operation of Healing Nations as a medical marijuana dispensary, and pay all required application and processing fees. Thereafter, City personnel would review the documents submitted to determine if additional information was required. This would be followed by a planning commission public hearing to determine whether the requested amendment was in the City's best interests and complied with the City's general plan. A recommendation would then be made to the city council, which in turn would hold another public hearing to approve or deny the amendment. After the hearing, an ordinance would be adopted either approving or denying the requested amendment, and make findings supporting its decision." Naulls submitted no request to amend the Specific Plan. Alternatively, Naulls could have requested a "`similar use finding'" pursuant to section 17.88 of the City's municipal code. This would require submission of an application, with supporting documentation, to demonstrate that the proposed use was similar to an existing use with the Specific Plan and was consistent with the City's general plan. Thereafter, proceedings would be scheduled before the planning commission. Naulls never made a request for a similar use finding. As such, HNC's operation within the boundaries of the Specific Plan was an unpermitted and illegal use.

Attached as an exhibit to the City's motion was a printout of materials pertaining to the Specific Plan, which encompassed HNC's location. Chapter No. 4 of the Specific Plan "sets forth permitted uses and development standards for various land use areas" within the districts it covers. The development regulations which govern the Specific Plan supersede the zoning provisions of title 17 of the Corona Municipal Code except to the extent the Specific Plan is silent. In those instances, the municipal code controls. These regulations make no provision for a medical marijuana dispensary as a permitted use. However, "[t]he Commission may, by resolution of record, permit any other uses which it may determine to be similar to those [enumerated]; provided such uses are not or will not be dangerous or offensive by reason of the emission of dust, gas, noise, fumes, odors, vibrations, or otherwise in conformity with the intent and purpose of the Zone, and...