Connect with CP&DR

facebook twitter

Follow us on Facebook and Twitter

Subscribe to our Free Weekly Enewsletter

Store Owner Stays Six Years after Condemnation, Still Gets Assistance

A doughnut shop owner who remained in his place of business for six years after the city acquired the property for redevelopment still qualified for relocation benefits as a "displaced person," the Second District Court of Appeal has ruled. The fact that the business owner "did not vacate the premises for six years after the [redevelopment] agency's initial acquisition of the premises is irrelevant. The critical factor is not when the property was vacated but why it was vacated," the Second District ruled in an opinion that the state Supreme Court ordered published. In February 1993, Veisna Kong signed a sublease with Frank Bartha, the primary tenant of property on Carson Street in Hawaiian Gardens. In July of that year, the Hawaiian Gardens Redevelopment Agency notified Kong that the city was considering acquiring the property and that he was eligible for relocation advisory assistance and possibly for relocation benefits. The city did purchase the property in August 1993. The following year, the city sold the property to Dr. Irving Moskowitz for development of a casino. Moskowitz, however, was not ready to pursue his project, so he and Bartha signed a new lease in June 1994. Kong remained as a subtenant and the city advised him that he would be eligible for relocation benefits when the contract extension expired. In April 1999, Moskowitz was ready to pursue his project. He gave Bartha six months notice that he was terminating the lease. Kong protested that the notice was improper, argued with Moskowitz and eventually as evicted from the premises in December 1999. In July 2000, Kong filed a claim with the city for $72,000 in relocation benefits, and, in September 2000, he filed a lawsuit demanding payment. (He also filed a separate lawsuit in federal court alleging inverse condemnation.) Los Angeles County Superior Court Judge Dzintra Janavs ruled for the city. Judge Janavs found that Kong had failed to prove that he vacated the property as a direct result of the city's acquisition six years earlier, so the city had no duty to pay relocation benefits. Kong appealed, arguing that he was a "displaced person" under the California Relocation Assistance Law (Government Code § 7260 et seq.). A unanimous three-judge panel of the Second District, Division One, agreed with Kong. The city argued that Kong did not qualify as a displaced person because he did not vacate the premises until after the expiration date of his original sublease with the Barthas. But the court ruled that the original sublease was terminated by the city's acquisition of the property. "Petitioner [Kong] was able to continue operating his donut shop after Dr. Moskowitz acquired the property from the agency only because Frank Bartha entered into a new lease agreement with Dr. Moskowitz," Presiding Justice Vaino Spencer wrote for the court. "Thus, the only reasonable construction of the evidence is that the original master lease between the Barthas and the Veady Family Trust was terminated as a result of the agency's taking of the property and replaced with the Bartha/Moskowitz lease. … That petitioner ultimately was not required to vacate the premises until after what would have been the last day of his original sublease with the Barthas (December 31, 1998) does not compel a contrary conclusion. Had Dr. Moskowitz needed the premises earlier, he could have terminated his lease with Frank Bartha well before that date." The "crucial factor," Spencer wrote, "is the ‘causal connection between the acquisition by the public entity and the displacement.'" Spencer cited Peter Kiewit Sons' Co. v. Richmond Redevelopment Agency, (1986) 178 Cal.App.3d 435. "The bottom line is that petitioner was required to move and thus was displaced for a public project," Spencer wrote. This makes him eligible for relocation benefits as a displaced person. The appellate court sent the matter back to the trial court to determine the amount of relocation benefits to which Kong is entitled. The Case: Kong v. City of Hawaiian Gardens Redevelopment Agency, No. B149322, 02 C.D.O.S. 9416. Filed June 13, 2002. Ordered published September 11, 2002. The Lawyers: For Kong: Anthony Parrille, (626) 294-0010. For Hawaiian Gardens: M. Lois Bobak, Woodruff, Spradlin & Smart, (714) 558-7000.
Search this site

NEW E-EDITION JUST PUBLISHED: