Hesperia Land Development Co. v. Superior Court In and For Los Angeles County

Citation7 Cal.Rptr. 815,184 Cal.App.2d 865
PartiesHESPERIA LAND DEVELOPMENT COMPANY, a corporation, et al., Petitioners, v. SUPERIOR COURT of the State of Callfornia, In and For the COUNTY OF LOS ANGELES, and the Honorable Joseph W. Vickers, Judge of said Court, Respondents, W. A. Savage, Real Estate Commissioner, Real Party in Interest. Civ. 24809.
Decision Date27 September 1960
CourtCalifornia Court of Appeals

Weber, Schwartz & Alschuler, Beverly Hills, Greenberg, Ziffren & Shafton, Los Angeles, Millen & Gerstenfeld, Beverly Hills, Jacob W. Silverman, H. Spencer St. Clair, Los Angeles, and Downey A. Grosenabaugh, Hollywood, for petitioners.

Stanley Mosk, Atty. Gen., Lee B. Stanton, and Arthur C. de Goede, Deputy Attys. Gen., for real party in interest.

KINCAID, Justice pro tem.

Petitioners seek writ of mandate ordering respondent court to vacate its final order of dismissal of an action heretofore filed in said court by petitioners as plaintiffs versus W. A. Savage, as Real Estate Commissioner of the State of California, No. EA-C153; to reinstate the temporary restraining order previously issued therein thus restoring petitioners to a status which existed prior to such order of dismissal; that thereby the said Real Estate Commissioner, the real party in interest herein, be enjoined from interfering with petitioners' sale or other disposition of their real property or with their activities or taking any further administrative action or proceedings and to stay any proceedings now pending before the said Real Estate Commissioner and for other relief.

On May 9, 1960, a temporary cease and desist order was issued by the said Real Estate Commissioner pursuant to section 10084, Business & Professions Code. This section was adopted by the Legislature effective July 20, 1959, (Stats.1959, ch. 2116, p. 4933) and provides as follows: 'Whenever in the opinion of the commissioner any person has or is violating, or is about to violate, any of the provisions of this part or of Chapter 1 (commencing at Section 11000) of Part 2 of this division, the commissioner may order the person to desist and refrain from doing so. If, after such an order is made, a request for a hearing is filed in writing and hearing is not held within 60 days thereafter, the order is rescinded.'

On May 24, 1960, petitioners filed with the Real Estate Commissioner, hereinafter referred to as 'commissioner,' their request for a hearing and also filed the above numbered action in respondent court and applied for and received a temporary restraining order and order to show cause. This restraining order precluded any further administrative action and restrained the enforcement of the cease and desist order issued by the commissioner. Subsequently a hearing on the order to show cause was held by the respondent court with all parties represented and the said court thereupon dissolved such temporary restraining order and dismissed the complaint in said action. The cease and desist order previously entered by the commissioner was thereby reinstated pending determination of the controversy by administrative processes.

On June 21, 1960, an amended order to cease and desist was served on said petitioners and was filed and a hearing was begun before an officer of the Division of Administrative Procedure of the State of California, who was assigned to preside. All parties were represented and evidence was received. The hearing was thereafter continued to July 21, 1960, for further consideration of the issues involved and on successive days additional evidence was duly received.

On August 22, 1960, following the hearings conducted by him on June 21 to 23 inclusive and July 11 to 25 inclusive, 1960, the said hearing officer filed with the commission his proposed decision. On September 6, 1960, the commissioner filed his order of nonadoption of the proposed decision. By said order the commissioner rejected in its entirety the proposed decision of the hearing officer and referred said matters to another hearing officer for further hearing.

On July 5, 1960, we granted alternative writ of mandate ordering the respondent court to assume jurisdiction of the above numbered action filed by petitioners in said court against said commissioner or show cause before this court why it should not do so.

Petitioners allege generally that certain of them are and have been engaged in the subdivision, development and sale of real property in the county of San Bernardino, commonly known as Hesperia and for convenience are referred to as the Phillips group. Certain other of the petitioners are engaged in operating a museum, a recreation club, an inn, a golf course and other similar activities within the Hesperia area. Petitioners' complaint as filed in the said action in respondent court, as well as the petition for mandate filed herein, avers that for some six years last past certain of the petitioners have improved and developed the Hesperia area resulting in substantial sales of real property; that at all times in question said developers believed and still believe that there was and is an adequate underground source of water to serve not only the present but further needs of the buyers and residents of said property and that the water distribution system and the source of water supply developed and made available to the Hesperia Water Company, a public utility company, were and are adequate under regulations of the Public Utilities Commission of California to serve the requirements of an increased density of population in said area; that said petitioners have expended large sums for advertising vertising and good will, have trained experienced sales and clerical personnel.

On July 29, 1958, the Public Utilities Commission (hereinafter called P.U.C.) did, upon its own motion, institute an investigation into the operation and service of the Hesperia Water Company and the Kayem Investment Company. Petitioners allege they were not parties to the hearing held before the P.U.C. nor were they given any notice of said hearing.

At the conclusion of the hearing before the P.U.C. an order dated November 17, 1959, was issued finding generally that Kayem Investment Company is a public utility water corporation owning and controlling a water system for compensation; that Kayem shall immediately file with P.U.C. certain reports, accounts and maps; that Hesperia Water Company shall submit a written plan for a water system adequate to serve the presently serviced area and to include the location of the proposed additional wells and other facilities which will afford reasonable assurance of sufficient potable water; that Keyem and Hesperia Water shall submit a proposed schedule for the rehabilitation of the water system facilities as studies may show to be insufficient, inadequate or obsolete; plans for fire protection service and including other directives.

It is further contended by petitioners that as a result of the issuance by the commissioner of the said cease and desist order they have suffered and will continue to suffer irreparable damage and injury in that they have been deprived of their right to sell or otherwise dispose of the property; that their reputations for integrity have been damaged; that their fixed expenses will continue though revenues from new sales of petitioners' property have been halted; that their credit has been impaired and that by virtue of the said commissioner's order issued without a hearing petitioners have been deprived of a constitutional right to prior notice and hearing.

Following issuance of the alternative writ herein, commissioner as real party in interest, in return to the alternative writ and by way of answer to the petition for writ of mandate, filed his demurrer and answer. The demurrer is on the ground that the petition does not state a cause of action nor does it state facts sufficient to entitle the petitioners to the relief sought and that this court does not have jurisdiction over the subject matter of the petition. The answer alleges that a hearing on said order to cease and desist, as amended, was held and is now being held within 60 days of the request therefor as provided by section 10084, Business and Professions Code; denies that petitioners referred to as the Phillips group did not participate in the P.U.C. hearing heretofore described or that they were not given notice of said hearing or the order issued upon the conclusion of said hearing. Said answer alleges upon information and belief that Kayem Investment Company and Hesperia Water Company have been since April 24, 1956, and now are under the complete domination and control of the Phillips group and that Kayem and Hesperia Water are merely the alter egos of said group.

The alternative writ was issued for the limited purpose of enabling us to consider the question as to whether the Legislature acted within its constitutional limitations in enacting the said section 10084, Business and Professions Code and, if so, to determine whether the means adopted to accomplish the result herein achieved by issuance of the said cease and desist order are reasonably designed for that purpose and have a real and substantial relation to the objects sought to be attained. In reviewing legislation for the purpose of testing its propriety as an exercise of the police power, the power of this court is limited to such a determination. It must be presumed at the outset that the Legislature acted within its powers. The burden is upon those attacking the statute to make a showing that the statute is unconstitutional. Serve Yourself Gasoline Stations, Ass'n v. Brock, 39 Cal.2d 813, 817-818, 249 P.2d 545.

In first considering petitioners' constitutional objections to said section 10084, it is necessary to review the procedure authorized by said enactment. It authorizes a cease and desist order whenever, in...

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5 cases
  • Serna, In re
    • United States
    • California Court of Appeals Court of Appeals
    • 20 Enero 1978
    ...withdrawn from an administrative appeals procedure is considered to be without jurisdiction. (Hesperia Land Development Co. v. Superior Court (1960) 184 Cal.App.2d 865, 876, 7 Cal.Rptr. 815.) Adherence to the exhaustion principle insures deference to the expertise and discretion of administ......
  • Southern California Title Co. v. Great Western Financial Corp.
    • United States
    • California Court of Appeals Court of Appeals
    • 15 Junio 1967
    ...the administrative remedies prerequisite to judicial action of the nature herein requested. (Hesperia Land Development Co. v. Superior Court, 184 Cal.App.2d 865, 7 Cal.Rptr. 815; People v. Coit Ranch, Inc., 240 Cal.App.2d 52, 21 Cal.Rptr. 875; Anderson v. Dept. of Alcoholic Bev. Control, 15......
  • People v. Mancha
    • United States
    • California Court of Appeals Court of Appeals
    • 5 Junio 1974
    ...open to such abuses is beyond question. (In re Sidebotham, 12 Cal.2d 434, 436, 85 P.2d 453; Hesperia Land Development Co. v. Superior Court, 184 Cal.App.2d 865, 875, 7 Cal.Rptr. 815.) The state in the exercise of its police power may regulate the enjoyment of property rights whenever reason......
  • Massingill v. Dept. of Food & Agriculture
    • United States
    • California Court of Appeals Court of Appeals
    • 26 Septiembre 2002
    ...the burden of establishing it does not reasonably relate to a legitimate government concern. (Hesperia Land Development Co. v. Superior Court (1960) 184 Cal.App.2d 865, 870, 7 Cal.Rptr. 815.) Amended section 13651 is a valid exercise of the Legislature's police power. There can be no doubt ......
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