IJ is on a roll in the fight against policing for profit. In February, we obtained an unanimous U.S. Supreme Court ruling establishing, for the first time, that the Constitution’s ban on excessive fines applies to states as well as to the federal government. This past fall, we ended Philadelphia’s notorious forfeiture machine, which seized millions of dollars’ worth of property from individuals who were never charged with crimes. And last December, in Indio, California, we established that it’s illegal for criminal prosecutors to charge defendants for the cost of their own prosecutions.
But our opponents are nothing if not creative. In the wake of our success in California, “city prosecutors”—many of whom are really just private law firms hired by cities—are finding a new way to squeeze cash out of citizens: health and safety receiverships.
Traditionally, receiverships are a tool that allows a city to take temporary possession of a property in order to fix an imminent danger to the community—a structurally unsound building, for instance. The city addresses the threat posed by the property and sends a bill to the owner. If the owner is unable to pay, the bill is attached to the property as a lien and the house is sold.
In California, however, receiverships are no longer a last resort. Cities are increasingly using receiverships for minor code violations because receiverships are easy money.
IJ client Ron Mugar learned about receiverships the hard way. In his retirement years, Ron has enjoyed building and tinkering with machines on his large property in Norco, a semi-rural city known as “Horsetown, USA.” Ron has occasionally annoyed his neighbors (or their real estate agents) by leaving his tools and parts out in the yard. He had been cited before, but he always cleaned up his yard after receiving a citation. Last year, things were different. He received notice that the city was going to seize his house because, essentially, he was messy.
Ron knew that if his house went into receivership, he would lose it—he would never have enough cash to pay the receiver and the city’s law firm, so they would sell his house and take their cut of the proceeds, with very little likely left for Ron.
Ron quickly did everything he could to clean up his property while at the same time vigorously defending himself against some of the more outrageous demands that the city’s law firm was making. Ultimately, Ron prevailed. No receiver ever took possession of his home, the city admitted that Ron was in full compliance with city codes, and Ron successfully argued that he should not have to comply with some of the city’s demands (for instance, that Ron completely tear down his laundry room rather than simply bring it into compliance with the relevant codes).
It seemed like a rare happy ending in a receivership case, but then things took a strange turn. The city asked the trial court to declare that the city was the prevailing party in the case and to award it attorney’s fees of $60,000—paid out of Ron’s home equity.
Norco’s predatory practices are not just immoral, they are unconstitutional under both the U.S. and California constitutions. IJ stepped in to represent Ron, explaining that the city did not, in fact, win the initial case and is not entitled to fees. Furthermore, we argue that due process prohibits city attorneys from having a financial stake in the cases they bring—an argument that another judge of the same court already accepted in our Indio prosecution fees case.
Though the trial court ruled against us and granted the city’s request, neither Ron nor IJ is giving up. We’re taking the case to the California Court of Appeal, where we intend to score yet another decisive victory against policing for profit.
Jeffrey Redfern is an IJ attorney.
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