A Santa Monica law limiting occupancy of second units to relatives and domestic employees has been thrown out by the Second District Court of Appeal. The unanimous three-judge panel ruled that the city's second-unit ordinance violated privacy and equal protection rights. "Government may legitimately decide whether second units may be constructed in particular zones, but may not determine who may live in them," wrote Judge Paul Boland, a Los Angeles County Superior Court judge sitting by assignment. In 1982, the state Legislature approved a bill encouraging cities and counties to permit second units in single- and multi-family residential zones (Govt. Code § 65852) to help provide needed housing. Still, the City of Santa Monica prohibited second units. In 1996, a landowner in a wealthy part of town with single-family zoning sought approval to construct a second unit. Staff members advised the City Council that the city's existing ban was illegal and that an ordinance limiting occupancy to family members also would be susceptible to legal challenge. In late 1996, the council voted 4-3 to adopt an interim ordinance allowing second units for use by dependents and caregivers who could demonstrate a substantial hardship. The ordinance prohibited renting the units. The council made the decision after an outpouring of opposition to second units from single-family homeowners. The council later extended the interim ordinance for 18 months before reconsidering it in June 1998. The council at that time readopted the ordinance without the hardship requirement, and with regulations governing lot size, density, unit size, parcel coverage, parking and design standards. The council on a 5-2 vote made the ordinance permanent in May 1999. Meanwhile, the Coalition Advocating Legal Housing Options and Lou Moench, a former city planning commissioner, sued the city in September 1998. Los Angeles Superior Court Judge Robert O'Brien rejected the challenge without explanation. The Second District, Division Seven, overturned that decision. The appellate court held that the case was quite similar to the privacy issues in City of Santa Barbara v. Adamson (1980) 27 Ca.3d 123. In that case, the state Supreme Court invalidated an ordinance that prevented unrelated groups of more than five people from occupying a home in a single-family zone. The court determined that the "rule of five" had nothing to do with legitimate land use issues, such as noise, traffic and parking. "Unless we say that a second unit is not a part of one's home, personal decisions about who may live in the second unit are no less entitled to privacy protection than decisions about who may live together in the main residence," Justice Boland wrote. The court rejected the city's argument that Adamson was no longer precedent or was inapplicable. Boland cited Loder v. City of Glendale, (1997) 14 Cal.4th 846, which said that an intrusion on a resident's privacy is not justified by the government's interest in local zoning. Instead of regulating who can live in a second unit, the city could set limitations on the number of permits issued, the size and density of second units, and establish parking and other requirements, the court held. The housing advocates' equal protection arguments found support in College Area Renters & Landlord Assn. v. City of San Diego, (1996) 43 Ca.App.4th 677, in which the court invalidated an ordinance that distinguished between tenant-occupants, and owner-occupants in residential neighborhoods. "The City argues," wrote Boland, "that its objective is to preserve the ‘character and integrity of single family neighborhoods' and avoid an undue concentration of population and traffic. These are certainly legitimate goals, but it is difficult to see how the status of the occupier of a second unit — an unrelated renter versus a dependent or caregiver who is allowed to pay rent — bears any relationship to either one." The court also rejected Santa Monica's argument that its status as a charter city allowed it to avoid the state law regarding second units. "The Legislature has expressly declared housing to be a matter of statewide concern," Boland wrote. "Santa Monica is required to comply with § 65852.2, as it recognizes in the introductory words to its own ordinance." The Case: Coalition Advocating Legal Housing Options v. City of Santa Monica, No. B135879, 01 C.D.O.S. 2930, 2001 Daily Journal, D.A.R. 3589, filed March 13, 2001, ordered published April 11, 2001. The Lawyers: For the coalition: James Isaacs Jr., Isaacs, Clouse & Crose: (310) 458-3860. For the city: Cara Silver, deputy city attorney, (310) 458-8336.