Health and Safety Receivership: California's Cure for Zombie Foreclosures, Vacant, and Other Nuisance Properties
Almost every city or county has abandoned, fire damaged, vacant or other nuisance properties. The majority these properties sit abandoned and blight communities for years with no solution in sight. However, California has solution for these longstanding nuisance properties known as Health and Safety “H & S” receiverships. The statutory authority for H &S receiverships is found at California Health and Safety Code (“HSC”) §§ 17980.6 and 17980.7. Abandoned, vacant and other nuisance properties surface in a variety of ways. However, a few of the most common occurrences are:Deceased property owners without heirs; Zombie foreclosures; Hoarders and other mental health conditions; Slumlords that allow dangerous conditions at their property; Owners that file bankruptcy and abandon their property; Abandoned and/or vacant properties.HSC section 17980.7 allows a city to nominate a court receiver over a dangerous property. The Receiver is an agent of the court that is authorized to borrow funds to rehabilitate and sell the property. (California Code of Civil Procedure (“CCP”) section 568.5; see also (Santa Monica v. Gonzalez (2008) 43 Cal. 4th 905, 930)Abating a vacant, abandoned or other type of nuisance property cures bighted neighborhoods. Furthermore, the process costs the city nothing. In fact, the city recovers attorney’s fees and costs it incurred in the receivership action. (HSC 17980.7(c)(11) & (d)(1); see also (City and County of San Francisco v. Jen (2005) 135 Cal. App. 4th 305, 310-311). In summary, California’s health and safety receivership process improves blighted neighborhoods and actually generates revenue for cities. Implementing a receivership program is a major undertaking, but the benefits are substantial.This article will explain the following:How nuisance properties arise; How cities typically deal with nuisance properties; How receivership can help cities; How receivership in California; How cities throughout California have practically implemented receivership programs.