LAGUNA BEACH : Residents to Appeal ‘Granny Flat’ Ruling

A Superior Court decision upholding a crackdown on bootleg apartments that might affect up to 600 Laguna Beach residents will be appealed, an attorney in the class-action lawsuit said Friday.

In response, City Atty. Philip Kohn said the city will probably take immediate legal action against 14 people who have “thumbed their noses” at the city by refusing to dismantle their illegal apartments.

“Basically, we know who they are, and we will likely proceed directly to court,” Kohn said.

In August, Judge William F. McDonald partially rejected a class-action lawsuit alleging that the city illegally tried to eliminate South Laguna’s bootleg apartments. The units had proliferated under more relaxed county standards before the area was annexed by Laguna Beach.

The ruling meant that many property owners had to dismantle their illegal second units, apply for permits or face civil charges.

Many residents said they depend on income from the apartments, commonly called “granny flats,” to make mortgage payments.

Before the decision was made to appeal the case, attorneys for both sides tried to reach an agreement that would have given property owners a grace period before they had to take any action. Both sides, however, accused the other of taking an unreasonable approach.

“You would have thought from the demands (that) they won the lawsuit,” Kohn said.

But Philip Smith, an attorney for property owners, said there is no question the city violated state law by discouraging attempts to legalize the units for 18 months after incorporation. Smith has maintained that the judge agreed with the property owners on some important points of law but stopped short of asking the city to correct past wrongs.

“The lower court held the city violated the state law but the court couldn’t do anything about it,” said Smith. “We don’t think an appellate court is going to agree.”

Smith said he will ask the appellate court to block city action to dismantle the units until the appeal is heard.