Past actions of Mayor Pam Patterson, council majority deemed unlawful by superior court judge
By Allison Jarrell
An Orange County Superior Court judge ruled last week that the San Juan Capistrano City Council unlawfully repealed the approval of the San Juan Hotel & Villas project in January 2015, acting “in excess of their jurisdiction.”
Judge Randall Sherman concluded on Feb. 25 that the City Council’s repeal of the Urban Village development approval “was unauthorized by law because it was premised on a referendum.”
Sherman said referendums do not apply to resolutions that are “administrative, adjudicative or executive in nature,” and in this case, the resolution to approve the project was not legislative because “it merely pursued a plan already adopted by the City Council.”
City Attorney Jeffrey Ballinger said the City Council will discuss the court’s ruling at today’s 3 p.m. closed session meeting. No comment was given as to whether the city will appeal the ruling, which could potentially award Urban Village Development more than $5 million in damages.
From Approved to Repealed
The San Juan Hotel & Villas project was initially approved by a previous City Council on Nov. 19, 2014, after the locally-owned company had spent more than two years working with city staff and presenting at numerous public hearings and community meetings. The 136-room hotel was set to be operated by Kimpton Hotels & Restaurants and would have included commercial space in addition to 30 single-family homes on a 3.17-acre site in the heart of the historic town center.
A new City Council was sworn into office in December, filling out the dais with a majority of members that opposed the development—then-mayor Derek Reeve, Councilwoman Kerry Ferguson and Councilwoman Pam Patterson were outspoken critics of the project during their campaigns.
Patterson became an active participant in the movement for a referendum, and along with a group of citizens opposing the development, petitioned against the project’s approval. The group collected enough signatures for a voter referendum, which was validated by the Registrar of Voters.
When the petitions came back before the City Council on Jan. 20, 2015, rather than putting the matter before voters as a referendum, the majority of council members chose to make the decision themselves to repeal the project’s approval, saying their election to the City Council was indicative of how residents would vote on the project.
The council voted 4-1, with Councilman Sam Allevato dissenting, to repeal the approval.
Urban Village’s attorney, Chuck Krolikowski, maintained that because the hotel’s approvals were administrative and not legislative, the referendum was illegal. Furthermore, Urban Village principal Joshua Host said the referendum’s signatures were collected by “espousing outrageous lies to unsuspecting residents,” including that the hotel and villas would be constructed in Veteran’s Park.
Urban Village filed a suit on Jan. 27, 2015 seeking at least $5 million in damages due to loss of use of the property and diminution of the property’s value.
The superior court rejected the city’s argument that Urban Village lacked standing to pursue a writ of mandate because, “developers have standing even if they have not yet concluded an agreement with the property owner to acquire the site, and even if their contracts with the property owner have terminated or expired.”
Sherman said the city’s argument that the approval of the project was inconsistent with the General Plan is the subject of a different case, Save Our Historic Town Center v. City of San Juan Capistrano, which was essentially on hold until the issue of the referendum was ruled on. That case will be decided at a later date.
Councilman Derek Reeve took to his public Facebook page Thursday to comment on the case.
“Regarding legal issues, I tend to be quite judicious with my public comments, however at this time I feel at liberty to commend the court for making the proper ruling,” Reeve wrote. “While I did not support the Urban Village project, I also did not support the referendum. In my learned opinion the law is clear: the referendum was repealing an administrative action not a legislative one, and this is prohibited by law.”
Host said while he was happy with Sherman’s decision, he “never wanted a fight” in court. Even though he doesn’t have “high hopes” for working on a settlement with the city, he said he’s open to trying to “find a middle ground that would work for everybody.”
“We’ve extended an olive branch to the city,” Host said. “Damages are amounting on a daily basis. I think there are some very bright council members, and hopefully they can bring everyone together and we can have a conversation about what’s best for the city’s constituents.”
Currently, a new boutique hotel is planned for the property Urban Village had planned to build on, which is owned by local movie producer and director Steve Oedekerk. That hotel—also to be operated by Kimpton—is currently going through the city’s planning process, including a recent hearing at a Design Review Committee meeting.
Host said he’s supportive of Oedekerk and his endeavors, but he hasn’t necessarily moved past the idea of pursuing development in San Juan.
“Building here isn’t ruled out,” Host said.