Michael and Kellie Ballard provided safe, affordable housing for their long-time employee and his family at the Ballards’ historic vineyard and winery in Santa Clara County, California. For that good deed, the Ballards have been fined more than $120,000.

Michael and Kellie have owned the Savannah-Chanelle Vineyards for nearly 30 years. For the last twenty, Marcelino Martinez has worked as the vineyard manager and become like family to the Ballards. In 2013, when Marcelino lost his lease on a nearby home, he asked the Ballards if he could move a trailer home into an out-of-the-way part of their property. Without that lifeline, Marcelino and his family’s only other option would have been to give up their jobs and their children’s school and move out of the area entirely.

The Ballards gladly agreed to help Marcelino and his family.

But four years later, the county learned about the trailer. What the Ballards didn’t realize is that living in a trailer in Santa Clara County is technically illegal. When they found out, the Ballards were faced with a horrible choice: Either kick the Martinez family off their land or get fined every single day that the Martinez family lived there.

For the Ballards, the choice was easy: the Martinezes would stay. They agreed to build a permanent home for the Martinez family on the winery’s 60 acres. But delays due to permitting, COVID-19, and other issues meant that their plan has taken years to come to fruition.

During that time, the county unrelentingly continued to fine them $100 per day—ultimately reaching a staggering $120,000.

Those fines were not imposed by a judge or a jury. Instead, a county official called a “hearing officer” levied them.

Now the Ballards are joining with the Institute for Justice to challenge the ruinous daily-accruing fines imposed on their charity—using their own property to provide a secluded and beautiful place for the Martinez family to live—that harmed no one, and to challenge the ability of county administrators, rather than judges and juries, to impose such fines.

The lawsuit, which is part of IJ’s Zoning Justice Project, argues that the constitution’s Excessive Fines Clause requires that any fines must be proportional to the alleged offense. And separation of powers and trial by jury guarantees demand that Americans facing fines—punishment for violating the law—are entitled to defend themselves in a real court, with a real judge and jury. The county’s fines and proceedings in this case trampled on all those rights.

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The Ballards’ Secluded Enclave

In 1996, Michael and Kellie Ballard bought a historic vineyard and winery in Santa Clara County. Located in the Santa Cruz Mountains near the village of Saratoga, the property is nearly 60 beautiful acres of vineyards, redwood forest and creeks. It was first settled in the late 1800s and has been a vineyard and winery for more than 100 years. The Ballards renamed the property “Savannah-Chanelle Vineyards” for their two daughters.

The Ballards’ vineyard manager, Marcelino Martinez, has worked on the property for 20 years. Initially, Marcelino lived several miles away in a rented mobile home. But in 2013, with housing costs in the area rapidly increasing, the owners informed him that they needed it for their adult daughter to live in and Marcelino and his family had to move out. Marcelino looked for a new home, but realized that there was nothing in his budget within a reasonable distance of the winery. 

The high housing costs in the area meant the Martinez family faced a horrible choice: Despite having well-paid jobs, the Martinezes could not afford to live in the area. Moving would mean giving up their jobs and taking their children out of their school. 

But with the Ballards’ help, the Martinez family came up with a solution. Marcelino bought an RV trailer and, with the Ballards’ permission, moved it to a quiet corner of the Savannah-Chanelle Vineyards, down the hill and away from the vineyard and winery. The home could not be seen from outside the property, was connected to utilities, and was safe for everyone. 

County fines and permitting problems.

For four years, the Martinez family thrived, but in 2017 that peace was shattered. Someone filed an anonymous complaint with the county about an unrelated matter. Although the inspector confirmed that the complaint was baseless, he saw the trailer home, which set off years of conflict with the county.

In Santa Clara County—one of the most expensive housing areas in the entire country, where working-class people struggle to afford housing—it is illegal to live full-time in an RV trailer. And although it is possible to live in one part-time, the county has also taken steps to crack down on that as well. 

Laws like Santa Clara’s serve little purpose other than exacerbating the housing crisis; they reduce housing where it is most in demand, drive up rents, and force low- and middle-income families to move. They also hurt employers who cannot find and keep workers.

The county’s crackdown presented the Ballards with in an impossible situation: Either kick the Martinez family out of their home or face daily fines. Rejecting the “inhuman” choice of forcing the Martinez family onto the street when they already had a home, the two families devised a plan: They’d build a permanent home for the Martinez family. 

Building housing in California is not quick or easy. Months turned into years as the Ballards spent tens of thousands of dollars on permits, studies, surveys, ground preparation, and more. The Martinez family spent thousands of dollars of their own money to buy a pre-fab home, only to discover that—while generally legal in California—it was not legal on the Ballards’ property.

Along the way, the plan suffered several setbacks. During the coronavirus pandemic California ordered the winery—the Ballards’ only source of income—to close for more than two years. The pandemic also dragged the already slow permitting process to a standstill. At the same time, increased demand for housing caused supply shortages and increased costs for manufactured housing. To make matters worse, a number of landslides on a neighboring property shut down access—and sometimes power—to the winery for weeks at a time. 

Through it all, the Ballards and Martinezes persisted. 

Finally, by late 2022, they were able to acquire an allowed home, finish their surveys and studies, and get a permit for the Martinez family’s new home, just 200 feet away from the RV they have lived in for more than a decade.

Nevertheless the county refused to relent and insisted that the fines have accrued daily, despite the Ballards’ best efforts to come into compliance.

During a hearing in 2019, the county “hearing officer” said that he recognized that the Ballards were “trying to keep the Martinez family from homelessness” and had “provided a secluded enclave for the Martinez family to live and work” when it was “unlikely”—really, impossible—to find “a comparable living environment at an affordable cost.” Nevertheless, the hearing officer imposed a backdated $100 fine per day on the Ballards until they either kicked the Martinez family out of their RV home or finished the new home. 

As the permitting dragged out, those fines eventually totaled a staggering $120,000.

California’s Housing Crisis 

The Ballards’ and Martinezes’ situation demonstrates how and why California is experiencing a housing supply and cost crisis.

Santa Clara County, and Saratoga in particular, has high housing costs, even compared to the rest of California. In 2011, Saratoga was the most expensive suburb in California. By 2016, Saratoga was the most expensive housing market in the United States. These high costs were driven even higher during COVID-19. Recent census data shows:

  • Average rent exceeds $2,600 per month in the county and $3,500 per month in Saratoga;
  • 73.8% of all housing in the county is valued at more than $1 million, with only 5.8% less than $300,000; those figures are 93.9% and 1.2% in Saratoga. 

The median house price in Santa Clara County is $2 million; it is nearly $4 million in Saratoga. In 2023, Santa Clara County was the second most expensive county in the nation to buy a home; in 2024, it became the most expensive.

Things are so bad that California’s own Housing Crisis Act of 2019 1 admits that there is a housing supply crisis that has caused existing housing, especially in the largest cities, to be very expensive. The supply problems have been caused, in large part, by “[l]engthy permitting processes and approval times, fees and costs for parking, and other requirements.” And the resulting increases in housing costs have “particularly exacerbated the need for affordable homes at prices below market rates,” contributed to “poverty and homelessness,” “[f]orced lower income residents into crowded and unsafe housing in urban areas,” “[d]riven families out of the state or into communities away from good schools and services, making the ZIP Code where one grew up the largest determinate of later access to opportunities and social mobility,” and caused employers “increasing difficulty in securing and retaining a workforce.”

The Ballards’ struggle exemplifies these issues. They have already spent years and tens of thousands of dollars to obtain the permits and studies the county required just to put a modest home—which cost yet more money—on the property. 

Fining them $100 every day on top of that serves no purpose. The Ballards have not hurt anyone by sharing their property with the Martinez family. They should not be fined for doing good. Human kindness should not be illegal. The county’s insistence on fines (and its insensitivity to the consequences of their enforcement) is not only punitive but also counterproductive.

The Legal Claims

The Ballards are challenging the fines imposed in their case as a violation of the Excessive Fines Clause of the Eighth Amendment. The constitutional protection against excessive fines is grounded in Magna Carta in 1215. As the U.S. Supreme Court recognized in its landmark decision Timbs v. Indiana, the protection against excessive fines is fundamental and a constant shield throughout Anglo-American history. 

Fines must reflect a defendant’s culpability as well as the harms caused by the violation. But the Ballards were not doing anything wrong; they were helping their friend afford housing. And the fines imposed here are entirely out of proportion to the underlying violation, which did not cause any harm to anyone.

Exacerbating the excessive fine problem here is that the fines are daily. California limits fines to $100 for an infraction of a local code. 2  But by treating every day as a new violation, the county argues it can reimpose the same fine over and over—turning a $100 fine into a potentially unlimited fine for the same minor offence. California’s Supreme Court has already recognized the problems with these daily-recurring fines. Per-day fines mean “that a single wrongful act . . . if not corrected, will subject him to potentially infinite penalties, regardless of the circumstances of the violation, the offender, the victim or the damage caused.” 3  It is little surprise then, the Court writes, that daily-accruing fines can cause “confiscatory” and “disproportionate” results in violation of constitutional protections.

In addition, the constitutional guarantees of separation of powers and trial by jury together require that Americans facing fines are entitled to defend themselves in a court of law, with a judge and jury. In the Ballards’ case, the fines were imposed by a “hearing officer”—an employee of the County—not an independent judge. As the U.S. Supreme Court recently reiterated, only courts can punish people by imposing fines or determine the culpability of the defendant and the need for deterrence that inform the amount of a fine. 4

The Ballards’ case is part of IJ’s broader efforts to combat abusive fines and fees and advance its Zoning Justice Project, which fights against zoning laws that stifle property rights and exacerbate the housing crisis. The Ballards’ case highlights how rigid zoning codes and punitive enforcement can prevent private solutions to societal problems, like affordable housing, from taking root.

The Litigation Team

The litigation team consists of IJ Senior Attorneys Paul V. Avelar and William R. Maurer.

About the Institute for Justice

Founded in 1991, the Institute for Justice is a public-interest nonprofit law firm that litigates nationwide to vindicate individual liberties. IJ litigates in the courts of law and in the court of public opinion to defend free speech, economic liberty, educational choice, and property rights. IJ has filed lawsuits all over the country defending individuals against excessive fines, abusive zoning and other laws that prevent people from using their own property to build housing and create private solutions to government failures, and the power of the administrative state.