Crescent City Motel Receivership: Court of Appeal Affirms Appointment of Red Griswold

Richardson “Red” Griswold was appointed by the Del Norte County Superior Court as the health and safety code receiver over the Town House Motel in Crescent City, California in the matter of City of Crescent City v. Sarvada Nand Hanumanthu Reddy. While he was initially appointed in November 2014, the matter has been stayed since that time because the property owner filed an appeal, challenging the legal sufficiency of the Court’s order appointing Mr. Griswold. In February 2017, the Court of Appeal (First Appellate District, Division Four) issued its written opinion, which affirmed the trial court’s order appointing Mr. Griswold as receiver.  PDF of Court of Appeal's Opinion.  Following the issuance of the opinion, Mr. Griswold began carrying out his court-ordered duties as the health and safety receiver over the 23-unit motel in Crescent City.

The property owner’s appeal focused on three main arguments: 1) the trial court mistakenly overruled the owner’s evidentiary objections at the appointment hearing, 2) the trial court should have taken live testimony at the appointment hearing, and 3) the trial court abused its discretion in appointing Mr. Griswold as the receiver. The Court of Appeal found no merit in any of the property owner’s contentions. Of note, the Court of Appeal clarified that Health & Safety Code section 17980.7 does not require that a receivership be avoided if a less drastic remedy is available. The Court of Appeal reiterated that the Legislature “presumably concluded that uncorrected substandard building conditions present a sufficient danger to justify appointment of a receiver without regard to less invasive alternatives.” (See also City of Santa Monica v. Gonzalez (2008) 43 Cal.4th 905, 925-26).

American Lodge Receivership: California Health and Safety Code

Mr. Griswold will now compile a rehabilitation plan for the motel and report back to the trial court for review and approval to move forward.

For more information regarding receiverships, please contact Griswold Law Receiverships.

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