California Legal Brief

The Rule of County of Del Norte v. Britt is that a responding party who prevails in a receivership proceeding under Health and Safety Code section 17980.7(c) is entitled to attorney fees and court costs under section 17980.7(c)(11), even against a municipal enforcement agency, because this more recent and specific statute creates an exception to the general rule of section 17984 that shields public agencies from cost liability, under circumstances where the responding party was improperly named as a defendant and achieved complete vindication on the claims against them.

Appeal from order denying motion for attorney fees and costs in Del Norte County Superior Court.

Defendant Appellants were Darla Britt and Sheryl Allsop — sisters of deceased property owner Robert D. Kurtz who were improperly named as defendants in a receivership proceeding to abate nuisances on property they did not own.

Plaintiff Respondent was County of Del Norte — the municipal enforcement agency that filed the receivership petition to abate nuisances and remedy State Housing Law violations on property formerly owned by Kurtz after he died intestate.

The suit sounded in a receivership proceeding to abate public nuisances and remedy housing code violations. The County also sought to impose personal liability on the sisters for receivership costs and expenses.

The key substantive facts leading to the suit were: Robert D. Kurtz died intestate in 2020 as sole owner of a house in Crescent City; squatters moved into the property creating hazardous nuisance conditions including drug use and sales; the County's Code Enforcement Office issued notices to abate the nuisance; when contacted, Kurtz's sisters stated they had no interest in obtaining or rehabilitating the property; the County filed a receivership petition naming the "Estate of Robert D. Kurtz" and the sisters as defendants; after the receiver completed rehabilitation and sold the property, it sought to hold the sisters personally liable for approximately $38,700 in unpaid receivership costs.

The procedural result leading to the Appeal: The trial court denied the sisters' liability for receivership costs, ruling that they should not have been made parties to the proceeding, but then denied their motion for attorney fees and costs under Health and Safety Code section 17980.7(c)(11), ruling that section 17984 barred fee awards against municipalities and that the County was the prevailing party because it successfully obtained appointment of a receiver.

The key question(s) on Appeal: 1) Whether Health and Safety Code section 17980.7(c)(11) authorizes attorney fee awards against municipal enforcement agencies despite section 17984's general prohibition on cost awards against public agencies; 2) Whether the sisters qualified as prevailing parties in the receivership proceeding.

The Appellate Court held that Health and Safety Code section 17980.7(c)(11) creates an exception to section 17984's general rule because it is both more specific and more recently enacted, and that the sisters were prevailing parties as they achieved complete vindication on the only claims affecting them—escaping liability in a proceeding where they were improperly named as defendants.

The case is inapplicable when the responding party in a receivership proceeding actually owns an interest in the subject property, has legal responsibility for the housing code violations, or fails to achieve their primary litigation objective of avoiding liability.

The case leaves open questions about the proper procedural method for challenging the naming of non-existent legal entities like unestablished estates as parties, and the extent of remedial authority courts have when such procedural defects occur in receivership proceedings.