Mitakis v. Department of General Services

Opinion

BEACH, J. Appeal from judgment of the superior court granting plaintiff’s petition for a peremptory writ of mandate directing respondent to set aside its decision denying certain relocation assistance benefits to plaintiff. Affirmed.

Facts:

Certain background facts relevant to this action can be found in our decision in Albright v. State of California (1979) 101 Cal.App.3d 14, 17 [161 [686]Cal.Rptr. 317], That case involved certain issues on relocation assistance to displaced homeowners following the state’s acquisition in February 1973 of private property in Topanga Beach for public use. Because the individuals were leasing the land on which their homes were situated, the state took the position that they were mere renters and therefore eligible only for a maximum of $4,000 in relocation benefits (Gov. Code, § 7264) rather than the $15,000 maximum available to displaced homeowners (Gov. Code, § 7263). We pointed out in Albright that while the displaced homeowners did not own the underlying land, they had entered into long-term leases (15 years) and had exercised rights and duties consistent with those of owners in fee. For these and other reasons set forth in Albright we concluded that the homeowners were entitled to the more generous benefits available to displaced “owner-occupants” rather than the lesser relocation benefits available to displaced renters.

We now turn to the facts of this case. Stephen Mitakis, one of the plaintiffs in Albright, supra, owned a small multifamily dwelling at 18672 Pacific Coast Highway (Topanga Beach) from 1965 through 1978. During that time, he lived in one unit while renters occupied the other two units. In 1967, he was served with a summons and complaint notifying him that the state had instituted condemnation proceedings to acquire his property for public use. In 1971, Mitakis purchased replacement rental property at 25342 West Malibu Road. In 1973, the state acquired title of the property in question by a formal order of condemnation.

After Mitakis and his tenants had vacated the Topanga Beach rental property, the State Department of General Services found Mitakis to be eligible for actual moving expenses but denied him the relocation payment at issue here, namely, payment “in lieu” of actual moving expenses, which Mitakis had sought under Government Code section 7262, subdivision (c). That provision allows a displaced business owner to choose between recovering actual moving expenses or payment in lieu thereof, ranging from a minimum of $2,500 to a maximum of $10,000, depending upon certain criteria. The Department of General Services based its denial on the fact that when Mitakis purchased the second rental property the condemnation proceedings had not been completed and therefore, the department concluded, the second rental property was simply a continuation of his business, rendering him ineligible for an “in lieu” payment. The decision was based on the Department of General Services’ regulation governing payments in lieu of actual moving expenses, which is found in title 2 of the California Administrative Code, section 1873.03(e)(1)(B). That section provides that “in lieu” payment is proper if the business “is not part of a commercial enterprise