Tenants Have No Rights to Individual Notice of a Development Agreement for Their Landlord

TENANTS HAVE NO RIGHTS TO INDIVIDUAL NOTICE OF A DEVELOPMENT AGREEMENT FOR THEIR LANDORD

San Francisco Tomorrow v. City and County of San Francisco (Parkmerced Investors, LLC)

(2014) 176 Cal.Rptr.3d 430

The fact that a Development Agreement contains very precise terms does not change the nature of its approval from that of a legislative action, even when the rights of third parties are affected. (Gov. Code § 65867.5, subd. (a).) In San Francisco Tomorrow v. City and County of San Francisco (Parkmerced Investors, LLC) (2014) 176 Cal.Rptr.3d 430, tenants of the Parkmerced project advanced a novel theory: that the approval of a Development Agreement, which granted certain contractual rights to their landlord, gave them the same procedural due process rights that attach to “adjudicative” permits and entitlements.

The Court was not persuaded that the Development Agreement should be treated any differently than other legislative actions merely because it governed certain rights and obligations of the project sponsor in its capacity as a landlord. The Court distinguished adjudicative decisions related to individual permits, where due process rights attach, from legislative actions such as the rezoning of an individual property, where such rights do not. Quite simply, due process protections that apply to adjudicative approvals – guaranteeing affected parties the specific right to notice by mail and an opportunity to be heard – do not apply to the adoption of a Development Agreement, which is a legislative act, even where the agreement contains terms that may affect the rights of third parties.

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