Key Points

  • The Fourth Appellate District, Division Three, reversed the dismissal of the residents' petition and directed the trial court to overrule the City of Stanton's demurrer.
  • The petition adequately alleged violations of Health and Safety Code sections 33413.5 and 33413 and of the Relocation Assistance Law, and acquisition agreements need not mention housing removal to trigger the replacement-plan duty.
  • The four-year statute of limitations did not bar the claims on demurrer because the duties are continuing and the city allegedly signed acquisition agreements through 2020 and demolished units through 2024.
  • The Kennedy Commission, an affordable-housing advocacy group, has standing to enforce affordable-housing rights even without personal harm.
  • The petition was not fatally uncertain, and the derivative injunctive-relief count survived demurrer even though an injunction is a remedy rather than a standalone cause of action.

A California appeals court has revived a lawsuit accusing the City of Stanton of buying most of a low-income neighborhood over 17 years, demolishing more than half of the fourplexes it acquired and never replacing the lost housing. The court ruled that residents and an affordable-housing group had adequately pleaded that the city violated state redevelopment and relocation laws.

A three-justice panel of the Fourth Appellate District, Division Three, reversed a trial judge's dismissal of the case and directed the lower court to overrule the city's demurrer. Justice Scott wrote the unanimous opinion, joined by Acting Presiding Justice Gooding and Justice Servino.

The opinion, filed Sept. 10 and certified for publication Oct. 7 at the request of the Legal Aid Foundation of Los Angeles, allows claims under the Community Redevelopment Law's replacement-housing provisions to go forward against a city that took over a redevelopment agency's properties after the Legislature abolished such agencies. It also holds that the four-year statute of limitations cannot end such a case at the pleading stage when the alleged violations are continuing, and that an advocacy group may sue to enforce affordable-housing rights without showing personal harm.

The case concerns Stanton's Tina-Pacific neighborhood, a roughly 10-acre private development built in 1963 that originally held 40 fourplexes, about 160 units. In 2009, citing blight, the Stanton Redevelopment Agency authorized the city to accept funding to buy properties there, and in 2010 the city received about $15.33 million in bonds to redevelop the area. The city bought about a dozen fourplexes between 2009 and 2011 and adopted a relocation plan in 2010 covering the residents of 10 of them.

Assembly Bill No. X1 26 dissolved all California redevelopment agencies effective Feb. 1, 2012, and Stanton's properties passed to the city and the Stanton Housing Authority. According to a city document, the change put the "redevelopment of the site on hold until such a time as alternative funding sources could be identified." Even so, the city, acting as successor agency, bought a dozen more fourplexes in 2012, bringing its holdings to 25 of 40.

According to the petition, units the city acquired deteriorated until some tenants left, the city did not re-rent vacant units, and each fully vacant fourplex was torn down, leaving an empty lot. In 2019 the City Council authorized buying the remaining 15 parcels for a planned 161-unit affordable housing development, but the city stopped in May 2020, citing the COVID-19 pandemic and rising relocation and property costs, after buying six. A later exclusive negotiating agreement with developers was dissolved without a contract.

The plaintiffs, the Tina-Pacific Residents Association, the Kennedy Commission and three former residents, sued in 2023. The trial court repeatedly sustained demurrers with leave to amend, then dismissed the nearly 80-page third amended petition without leave, calling its continued ambiguity a "tactical choice" and faulting plaintiffs for not tying specific actions to specific statutory duties.

The appeals court rejected the finding that the petition was too uncertain to answer. "We have carefully reviewed the operative petition and cannot say it suffers from uncertainty," Justice Scott wrote, adding that "despite its length, we were able to summarize the allegations" and that the city did not argue uncertainty on appeal.

On the first claim, the panel held the plaintiffs had adequately alleged a violation of Health and Safety Code section 33413.5, which requires an agency to adopt a replacement housing plan at least 30 days before signing an acquisition agreement that would lead to the destruction or removal of low- and moderate-income units. The city argued the purchases had not directly caused the demolitions. The court disagreed, citing city documents showing that between 2009 and 2024 the city demolished 17 of its 31 fourplexes and left 25 of the surviving 56 units vacant, "effectively removing over two-thirds of the acquired units from the housing market."

The court added that the duty applies even if the purchase agreements never mention demolition, quoting a 2005 federal decision, Price v. City of Stockton, which warned that otherwise "redevelopment agencies would always be able to circumvent [the] replacement housing mandate by simply omitting housing removal language from such agreements."

The panel also held the plaintiffs stated a claim under section 33413, which requires agencies to replace destroyed or removed affordable units within four years. The city maintained there had never been an official redevelopment "project," but the court pointed to the city's own 2013 and 2022 housing elements and a 2016 council report describing one. The use of redevelopment money, Justice Scott wrote, "reasonably suggests the acquisitions were made so the City could eventually redevelop the area—not because it wanted to provide stable ownership for residents or combat unsafe conditions."

A third claim, under the Relocation Assistance Law, also survived; the plaintiffs alleged the 2010 relocation plan was never updated for residents displaced later. Because the plaintiffs did not seek damages for unpaid relocation benefits, the court declined to address the city's argument that a 2025 settlement with certain plaintiffs barred such a claim.

The court rejected the city's statute-of-limitations defense, which rested on the project's start in 2010 and the 2023 filing. When plaintiffs seek to enforce continuing statutory duties "that are susceptible to recurring breaches, the continuous accrual theory defeats an untimeliness challenge on demurrer," the court wrote, noting the petition alleges acquisition agreements through 2020 and demolitions through 2024.

The panel also held the Kennedy Commission has standing because public interest associations "have standing to enforce affordable housing rights, even if not personally harmed." And while agreeing that "injunctive relief is a remedy rather than a standalone cause of action," it found a demurrer inappropriate for the injunction count because it derives from the mandate claims.

Lawyers for the residents and the Kennedy Commission included Marc Callahan of the Public Law Center. The city and the other defendants were represented by Elizabeth Wagner Hull of Best Best & Krieger.

The case now returns to the trial court, which must vacate its order and enter a new one overruling the demurrer, sending the claims forward. The plaintiffs will recover their costs on appeal.