Lambert v. Santa Monica Rent Control Bd.

Filed 8/30/06 Lambert v. Santa Monica Rent Control Bd. CA2/7

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or ordered published for purposes of rule 977.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION SEVEN

APPEAL from a judgment of the Superior Court of Los Angeles County. Patricia L. Collins, Judge. Affirmed.

Michael N. Koenig for Plaintiff and Appellant

David R. Daniels, General Counsel, Santa Monica Rent Control Board, Keith J. Kresge, Staff Attorney for Defendant and Respondent

_______________________

This appeal arises out of a dispute between a landlord and a tenant over the tenant's entitlement to the exclusive use of a two car garage in a rent-controlled apartment building in Santa Monica. Following an administrative hearing the Santa Monica Rent Control Board affirmed its hearing officer's finding the entire garage went with the tenant's apartment and was included in his rent. The trial court denied the landlord's petition for a writ of administrative mandate to overturn the board's decision. We affirm.

FACTS AND PROCEEDINGS BELOW

John Chilton, who has been the tenant of unit 2215-C since August 1979, filed a petition with the Santa Monica rent control board after the new owners of the property, Carl Lambert and Michael Koenig, "evicted" him from half of the garage he had been using since he moved into the unit. By his petition Chilton sought to establish the entire garage was an amenity of unit 2215-C and therefore its use was included in his controlled rent. Lambert contended Chilton was entitled to use one-half of the two car garage as an amenity of his apartment but he was not entitled to the exclusive use of the entire garage.

The board referred the petition to a hearing officer to take evidence and render a proposed decision. The hearing on Chilton's petition produced the following evidence.

The 1979 Santa Monica rent control ordinance required landlords to register all their controlled rental units with the Rent Control Board (board). The registration form asked landlords to identify, among other things, the "apartment amenities," including parking spaces and garages, being provided to each rent controlled unit.[1]

At the time the ordinance went into effect the subject apartment building was owned by William Hobson who filed the first registration for the building in June 1979. Hobson's registration form listed "garage" as an amenity provided for unit 2215-C.

Between 1977 and 1979 Bert and Hazel Woods occupied 2215-C and had the use of one of the two car garages on the property. Bert Woods did various chores around the property and his wife Hazel acted as Hobson's bookkeeper. Evidence admitted at the hearing showed Hobson paid the Woods in cash for their work. Evidence Hobson allowed the Woods to use the garage in return for their services was deemed unreliable by the hearing officer and not considered.

In 1977 John Chilton moved into unit 2215-B under an oral rental agreement with Hobson. Soon after moving in Chilton asked the Woods if he could use one of their garage spaces to park his car. The Woods agreed in exchange for Chilton taking the building's trash containers out to the street twice a week.

When the Woods moved out of 2215-C in the summer of 1979 Chilton took over their apartment and the garage with Hobson's approval. Chilton testified without contradiction he did not pay Hobson additional rent for the garage. Chilton has lived in 2215-C continuously since August 1979.

Rex and Gloria Martin bought the property from Hobson in December 1987. The registration form the Martins filed with the board showed "garage" as an amenity of unit 2215-C. Nevertheless, in January 1988 they began charging Chilton $100 a month for his use of half of the garage space.[2]

Chilton immediately filed a petition with the board seeking to establish the entire garage was a base amenity of his unit 2215-C. In his petition Chilton certified under penalty of perjury that to the best of his knowledge and belief Bert Woods "had use of this garage as he acted as on-premises manager of this property. When I moved into [the] apartment on 8/1/79, I did the same." A few weeks after Chilton filed this petition he dismissed it. He testified he did so because Hobson had become very upset upon learning about the petition and he did not want to alienate Hobson whom he considered a friend. From the time the Martins purchased the building in 1987 until a few months before they sold it in 2002 Chilton paid them $100 a month for half the garage space. He made these payments with checks separate from his apartment rent checks.

Soon after the Martins purchased the property they filed a rent increase petition with the board based on the cost of capital improvements. The hearing officer in the present matter took judicial notice of the decision on that petition. The board granted the Martins' petition for a rent increase with some modifications. As relevant here, the board disallowed half the cost of repairing the roof and door on the garage because the Martins were receiving a separate rent payment from Chilton for use of one-half the garage. Because only fifty percent of the garage benefited Chilton's unit, the board ruled the unit could only be assessed fifty percent of the cost of repairs.

Carl Lambert and Michael Koenig purchased the property from the Martins in August 2002. Chilton had ceased paying garage rent to the Martins a few months earlier. He testified he never believed the Martins were entitled to payment for his use of the other half the garage and when he heard the building was being sold he decided it was time to stop paying rent for that space.

Lambert served Chilton with a three day notice to quit half the garage. Chilton complied. He then filed a petition with the board to determine his entitlement to the entire garage as a base amenity of his unit.

After considering the evidence the hearing officer concluded the entire garage is a base amenity of unit 2215-C. Lambert appealed this decision to the board which affirmed it.[3]

Lambert then petitioned the superior court for a writ of administrative mandate setting aside the board's decision. Applying the independent judgment test, the trial court found the evidence at the administrative hearing supported the tenant's claim the entire garage was an amenity connected to his apartment. The court also rejected the landlord's contention the tenant's claim was barred by collateral estoppel and laches. Lambert filed a timely notice of appeal.

DISCUSSION

A determination by a rent control board affecting rents or amenities is subject to the trial court's independent judgment upon the evidence.[4] Thus, on a petition for a writ of administrative mandamus under Code of Civil Procedure section 1094.5 "[t]he trial court must not only examine the administrative record for errors of law, but it must also exercise its independent judgment upon the evidence."[5] An abuse of discretion on the part of the board "is established if the court determines that the findings are not supported by the weight of the evidence[.]"[6]

In the present case the trial court rejected Lambert's claims of legal errors in admitting and excluding evidence at the hearing and found the weight of the evidence supported the board's decision the entire garage was an amenity of unit 2215-C. We independently review the claimed errors of law. We may overturn a trial court's factual finding "only if the evidence received by the trial court . . . is insufficient as a matter of law to sustain the finding."[7]

Under section 13004, subdivision (e) of the Santa Monica Rent Control Board Regulations (Regulations) the building amenities first registered for a unit are presumed correct and the party claiming the registration was incorrect has the burden of proof on that issue.[8]

The undisputed evidence showed when Hobson first registered his units with the board in June 1979 he listed a "garage" as an amenity of unit 2215-C. Thus, under Regulations section 13004, subdivision (e) Lambert bore the burden of showing this designation was incorrect. In order to do so Lambert offered a letter purportedly written by Hobson in 1988 which states: "[W]hen I signed the information sheet regarding the apartments . . . I was not certain of the designations for each apartment and the lady on the desk filled it out for me. She said to show the garage with 2215-C even though it was not part of the apartment and it could be changed at a later date. I remember that I was very ill at the time this all took place and could not stand and argue about this so I signed it but I was very unsure about the designations." The letter further states Hobson "allowed [Woods] the use of one of the garages located below his apartment for helping me with the building." After Woods moved out, Hobson "allowed Mr. Chilton the use of one of my garages for helping me to watch over the building." According to the letter both the garages on the property were for Hobson's use "and were never part of the apartment at 2215-C." The letter concludes: "I hope you will accept this letter as my statement. I have recently had a stroke and am unable to come into your office for the hearing."[9] Attached to the letter is an alleged rent receipt card for unit 2215-C covering the period September 1, 1979 to August 1, 1980. The card bears the notation "No Gar."

Lambert argues the hearing officer erred in refusing to consider this letter as evidence the garage was not an amenity of Chilton's apartment. We disagree.

The board's rules of evidence provide in relevant part: "The hearing need not be conducted according to technical rules of evidence and witness [sic]. Any relevant evidence shall be considered if it is the sort of evidence on which responsible persons are accustomed to rely in the conduct of serious affairs, regardless of the existence of any common law or statutory rule which might make improper the admission of such evidence over objection in civil actions."[10] The hearing officer ruled the purported Hobson letter would not only be inadmissible hearsay in a civil action but it was "unreliable" and therefore not the sort of evidence on which responsible persons would rely in the conduct of serious affairs.

The board's reliability rule quoted above is one which is commonly applied in administrative hearings. The hearing officer's decision to exclude evidence under the rule is reviewed for abuse of discretion.[11] No abuse of discretion occurred here.

The hearing officer could reasonably conclude Lambert failed to produce sufficient evidence to authenticate the letter. Although the copy of the letter Lambert submitted appears to bear the board's filing stamp, Lambert testified he did not obtain the copy from the board but from the Martins, the previous owners of the property. No one testified to having witnessed its making or execution.[12] It was not authenticated as a response to a communication by Chilton, the Martins or Lambert[13] nor was there any evidence Chilton or Lambert ever acted upon the letter as if it were authentic.[14] The only evidence of the letter's authenticity was Lambert's testimony he was familiar with Hobson's signature and the signature on the letter appeared to him to be Hobson's.[15] Chilton, who was also familiar with Hobson's signature, testified to the contrary. The hearing officer concluded the signature on the letter "bears little resemblance to Mr. Hobson's signature on the registration form filed in 1979 [but even] taking into account Mr. Hobson's handwriting may well have changed after his stroke and surgery, there is no proof that he wrote, signed or subscribed to the contents of the letter."

In addition to its lack of authentication, some of the contents of the letter cast doubt upon its having been written by Hobson and that it reflects Hobson's actual understanding as to the use of the garage. We refer in particular to the letter's explanation why the initial registration mistakenly listed a garage as an amenity of unit 2215-C. According to the letter when Hobson filed the information form he was ill and confused "and the lady on the desk filled it out for me." The form, however, is typewritten making it doubtful it was filled out by a clerk standing at the counter. We do note the typewritten designations of a garage and an ocean view as amenities of unit 2215-C were crossed out and the designation of a garage only was handwritten on the form. This handwritten designation may have been placed on the form by "the lady at the desk" but the fact Hobson deliberately made the change or caused the clerk to make it contradicts the statement in the letter he was too ill and confused to understand which garage went with which apartment. (It is undisputed, however, Hobson correctly identified the other garage on the property as an amenity of unit 2217-A.) Furthermore, the letter states the board's clerk told Hobson to go ahead and list a garage as an amenity of unit 2215-C even though it was not because the designation could be changed at a later date. Yet, the undisputed evidence shows Hobson never made a change to this supposedly incorrect designation even though the Woods and then Chilton continued to use the full garage with Hobson's knowledge for nine years after the initial registration.

For the reasons stated above the hearing officer did not abuse her discretion in concluding the Hobson letter was unreliable evidence on the issue of whether the garage was a base amenity of Chilton's unit.

The trial court correctly identified the issue before the board as whether use of an entire two car garage was an amenity of unit 2215-C on April 10, 1978, the date for determining a unit's base rent under the rent control ordinance.[16] As discussed above Hobson's initial filing constituted prima facie evidence a "garage" was an amenity of the unit. The form Hobson filed, however, did not distinguish between the full use of a garage and the use of a parking space within a garage. As Lambert points out, it would be preposterous for a tenant in a high rise apartment building with a large underground parking facility to claim his "garage" amenity entitled him to the exclusive use of the entire parking for the building. Thus the nature of a "garage" amenity may sometimes turn on the facts of the particular case. In this case the trial court could reasonably conclude the weight of the evidence supported the board's finding the garage amenity of unit 2215-C constituted exclusive use of one garage on the property.

The following facts were established by undisputed evidence. When the Woods were the tenants of unit 2215-C they enjoyed the full use of a two car garage. When Chilton moved into unit 2215-C he enjoyed full use of the same two car garage without any additional rental charge for the remaining nine years Hobson owned the building. Hobson knew the Woods and Chilton were using the full garage but never objected and never sought to correct his initial filing designating the garage as an amenity of the unit without limitation. When the Martins bought the property they also designated the garage as an amenity of unit 2215-C without limitation although they began charging Chilton rent for one-half the garage. Unit 2217-A was also designated on the initial and subsequent filings as having a garage as an amenity. The tenant in that unit had full use of the other garage on the property. There was no evidence the tenant in 2217-A did any custodial or management work for Hobson in exchange for her use of the garage.

The following additional facts were also established by undisputed evidence. In a previous petition to determine amenities Chilton stated "under penalty of perjury" that to "the best of [his] knowledge and belief Bert Woods "had use of this garage as he acted as on-premises manager of this property"and that "[w]hen I moved into [the] apartment on 8/1/79, I did the same." For 14 years Chilton paid the Martins without protest $100 a month for use of one half the garage. The board's previous decision on the Martins' petition for a rent increase concluded the Martins were using one-half of the subject garage for their own benefit.[17]

We cannot say as a matter of law the evidence produced at the administrative hearing is insufficient to sustain the trial court's determination the board's decision is supported by the weight of the evidence.[18] The court could reasonably conclude the evidence Hobson knowingly allowed Chilton to use an entire garage for nine years for no additional rent, allowed the tenant in unit 2217-A to do the same, and that he never amended his initial filing showing a garage as an amenity of Chilton's apartment outweighed the evidence of Chilton's statement on his previous petition to determine amenities in which he said he had use of the garage in return for work in connection with the property and that for fourteen years he paid the Martins $100 a month for use of the second half of the garage. Chilton's previous statement he had use of the garage in return for work on the premises was made "under information and belief." He never testified to this because he withdrew the petition before the matter could be heard. His present petition may have been based on new information and belief. Chilton explained he acquiesced in the Martins' demand for rent for the second half of the garage because he did not want to alienate Hobson whom he considered a friend and who was upset upon learning Chilton was challenging the Martins' demand for garage rent.[19] As previously explained, the trial court properly found the board's previous decision on the Martins' petition for a rent increase did not determine the issue of entitlement to the garage.[20]

Lambert contends Chilton's present petition to determine base amenities (possession of the garage) should be barred by the doctrine of laches because Chilton filed a previous petition on the same issue in 1988, dismissed it prior to a hearing, and then paid the Martins $100 a month rent for half the garage space for the next 14 years.

The trial court rejected Lambert's laches defense on the grounds he waived it by not raising it at the "administrative level" and failed to support it with "evidence of prejudice or detrimental reliance." The court did not address the board's contention the doctrine of laches is inapplicable to petitions to determine rents or amenities.

For the reasons discussed below we conclude the defense of laches may be raised by a landlord in a tenant's petition to a rent control board to determine base rent or amenities, the landlord in this case did not waive the defense insofar as it was based on the theory of acquiescence, but the trial court correctly found the landlord did not produce sufficient evidence "of prejudice or detrimental reliance" at the administrative level.

The board asserts: "Equitable defenses apply in equitable actions in courts, not in administrative proceedings."

This is an incorrect statement of the law. In fact, our Supreme Court rejected this very argument in Lentz v. McMahon.[21] There the high court held administrative agencies not only may try equitable defenses but they are the preferred forum for "these largely factual claims."[22] Later, in Garland v. City of Clovis, the court noted the Clovis Rent Review Commission had the power to order "equitable remedies" in a landlord's petition for a rent adjustment.[23]

The board relies on Foster v. Snyder in which the Court of Appeal remarked: "The holding in Lentz does not stand for the all-encompassing conclusion that equitable principles apply to all administrative proceedings."[24] The board takes this statement out of context. The issue in Foster was not whether equitable principles apply to all administrative proceedings but whether the equitable defense of duress applied in a DMV license revocation proceeding in which the driver was charged with driving under the influence of alcohol.[25] Before reaching this issue the court made the point equitable principles cannot override an unambiguous and comprehensive statutory scheme. It cited, for example, our decision in Timberline, Inc. v. Jaisinghani holding the equitable doctrine of unclean hands cannot prevail over "a comprehensive statutory scheme specifying the requirements and powers of California corporations."[26] The Supreme Court made a similar point in Lentz.[27] The Foster court might better have stated its conclusion as: "The holding in Lentz does not stand for the all-encompassing conclusion that all equitable principles apply to all administrative proceedings."

Because petitions to establish base rents or amenities may require the board to resolve questions of fact which entail the testimony of witnesses or the production of documents we believe a landlord should be allowed to raise the defense of laches-not to override the city's comprehensive regulatory scheme specifying base rents and amenities-but to protect the landlord against prejudice resulting from unreasonable delay in the initiation of the proceedings. Thus, we agree with the conclusion in Hope Rehabilitation Services v. Department of Rehabilitation which held: "The doctrine of laches applies in administrative proceedings when the challenged administrative action has been unreasonably delayed, resulting in prejudice to the party against whom the action was taken. [Citation]."[28] We see no reason for distinguishing between an administrative action initiated by an agency, as in Hope Rehabilitation, and one initiated by an individual, as in the present case.

The trial court rejected Lambert's claim Chilton's petition was barred by laches because: "The defense of laches was not raised in the administrative level and cannot be raised here for the first time. Specifically, petitioner did not present evidence of prejudice or detrimental reliance at the administrative level."[29] We interpret the court's ruling as rejecting Lambert's defense of laches on two grounds: (1) he waived it by not raising it in the administrative proceeding and (2) even if he did not waive it, he failed to present sufficient evidence to establish it. We first address the waiver issue.

It is true Lambert failed to raise his laches defense at the administrative level. He argued in his closing brief at the administrative hearing Chilton's "petition is barred by . . . the lapse of time" based on the facts Chilton filed the same base amenity claim in 1988, withdrew it a few weeks later, then paid the Martins $100 a month for one-half the garage for the next fourteen years. He made this same argument in his appeal to the board from the hearing officer's decision. These arguments were sufficient in our view to raise the defense of laches based on Chilton's acquiescence in the Martins' claim to entitlement to half the garage.[30]

We agree with the trial court, however, Lambert did not preserve a defense of laches based on prejudice from inability to call Hobson as a witness. Lambert argued in the trial court, as he does on appeal, he was prejudiced by Chilton's delay in instituting the rent control proceeding because by the time he did so, in September 2002, Hobson was too ill and infirm to appear as a witness. Lambert never made this argument at the administrative hearing even though he was informed by the hearing officer, prior to submitting his closing brief, that she intended to decide the matter without Hobson's testimony. At oral argument on his appeal to the board from the hearing officer's decision Lambert made reference to Hobson being "frail and ill" and that it was "hard for him to remember his name." Lambert did not, however, argue he was prejudiced by Hobson's unavailability as a witness. Lambert's failure to produce evidence of prejudice from Hobson's unavailability as a witness precluded him from raising this claim for the first time in the trial court.

"Generally speaking, the existence of laches is a question of fact to be determined by [the hearing officer] in light of all the circumstances" and "[p]rejudice is never presumed."[31] Thus, Lambert had the burden of producing evidence Hobson's unavailability prejudiced his ability to prove that when Hobson listed a "garage" as an amenity of unit 2215-C he was either mistaken or he meant a parking space within the garage was an amenity of the unit. Such evidence might have consisted of a showing Hobson was presently incompetent to testify, no one else could testify to Hobson's state of mind regarding the garage, and no one could have authenticated Hobson's purported 1988 letter. Lambert also had the burden of proving Chilton unreasonably delayed in bringing his current petition to determine amenities and this unreasonable delay was the cause of Lambert's prejudice. To do so Lambert would have to prove Hobson's incompetence to testify occurred after the Martins started charging Chilton for use of the garage.[32] Prior to that time Chilton was using the entire garage for no additional rent so he had no reason to bring a petition to determine amenities.

Lambert contends Chilton is barred by laches from claiming the whole garage as a base amenity because he waited 14 years before bringing this petition and in the meantime he paid the Martins $100 a month for use of half the garage.

In order to establish a defense of laches based on acquiescence a defendant must produce evidence showing the plaintiff delayed unreasonably in challenging the wrongful conduct of another, defendant changed his position in justifiable reliance on plaintiff's inaction, and defendant was prejudiced by his change in position.[33]

We find no evidence in the record showing how Lambert (or the Martins for that matter) changed position in reliance on Chilton's acquiescence in the Martins' claim to half the garage. He did not testify he bought the property in reliance on Chilton's $100 a month garage rent. Nor did he testify he relied on the fact Chilton was paying rent for half the garage to conclude the owner of the property was entitled to that half. Even if Lambert had shown such a change of position in reliance on Chilton's acquiescence he could not show such reliance was reasonable. No reasonable prospective buyer of rent controlled property would rely on the implicit assurances of a tenant to determine the base rent and amenities of the tenant's unit.

Furthermore, Lambert introduced no evidence showing he was prejudiced by Chilton's acquiescence. Nor could he. Chilton's acquiescence did not cause Lambert to lose his entitlement to use half the garage. Neither Lambert nor the Martins ever had that entitlement.

Lambert argues that unlike other forms of laches, laches based on acquiescence does not require a showing of prejudice. He cites Conti v. Board of Civil Service Commissioners in which our Supreme Court stated: "The defense of laches requires unreasonable delay plus either acquiescence in the act about which the plaintiff complains or prejudice to the defendant resulting from the delay."[34] Whatever our high court had in mind when it wrote this one sentence summary of the defense of laches, it was not to signal a departure from the traditional view, expressed by the court itself in numerous cases, the defendant must show acquiescence and prejudice.[35] Indeed, in the very next paragraph of the Conti opinion the court explicitly declines "to hold that prejudice no longer constitutes an element of the defense of laches [because] to do so would, in effect, revive the discredited defense of 'stale claims' which we repudiated in Maguire v. Hibernia Sav. & Loan Soc.[.]"[36]

For these reasons we affirm the trial court's conclusion Chilton's petition to determine base amenities was not barred by laches.

DISPOSITION

The judgment is affirmed. Respondent is awarded its costs on appeal.

NOT FOR PUBLICATION IN THE OFFICIAL REPORTS

JOHNSON, Acting P. J.

We concur:

WOODS, J.

ZELON, J.

Publication Courtesy of California lawyer directory.

Analysis and review provided by Escondido Property line attorney.

[1] See 301 Ocean Ave. Corp. v. Santa Monica Rent Control Bd. (1991) 228 Cal.App.3d 1548, 1551.

[2] There is little evidence regarding the basis for this charge but it appears the Martins viewed one-half the garage as a base amenity of unit 2215-C and the other half subject to a separate rental at the rate of $100 a month. This is also the position taken by the current landlord, Lambert.

[3] The board's decision did not affect Lambert's right to eliminate one-half the garage as an amenity of unit 2215-C. However, because the entire garage was determined to be a base amenity at the time the unit was originally registered under the rent control ordinance, eliminating half that amenity entitled Chilton to a reduction in his rent. (See Sterling v. Santa Monica Rent Control Bd. (1985) 168 Cal.App.3d 176, 183-184.) In a separate proceeding the board found Chilton was entitled to a $100 a month rent reduction. This decision is not before us in this appeal.

[4] 301 Ocean Ave. Corp. v. Santa Monica Rent Control Bd., supra, 228 Cal.App.3d at page 1555.

[5] 301 Ocean Ave. Corp. v. Santa Monica Rent Control Bd., supra, 228 Cal.App.3d at page 1555.

[6] Code of Civil Procedure section 1094.5, subdivision (c).

[7] 301 Ocean Ave. Corp. v. Santa Monica Rent Control Bd., supra, 228 Cal.App.3d at page 1555.

[8] Regulation 13004, subdivision (e) states in relevant part: "The party to a hearing under this section who contends that the rent or the apartment and building amenities first registered for a unit are incorrect shall have the burden of proof as to the correct rent or amenities[.]"

[9] This is apparently a reference to a hearing on Chilton's 1988 petition to determine base amenities which Chilton dismissed before a hearing was held.

[10] Regulations, section 4012.

[11] Wilke & Holzheiser, Inc. v. Dept. of Alcoholic Bev. Control (1966) 65 Cal.2d 349, 376.

[12] See Evidence Code section 1413.

[13] See Evidence Code section 1420.

[14] See Evidence Code section 1414, subdivision (b).

[15] See Evidence Code section 1416.

[16] See 301 Ocean Ave. Corp. v. Santa Monica Rent Control Bd., supra, 228 Cal.App.3d at page 1551.

[17] Lambert contends this previous decision by the board collaterally estops Chilton from contending he is entitled to the entire garage because the board "necessarily determined" one half of the garage was for the use and benefit of the Martins. The issue of the garage as an amenity of unit 2215-C was not before the board in the Martins' rent increase petition and the board did not make a determination on that issue. The board only found as a factual matter the Martins were charging Chilton separate rent for one-half of the garage space. The board determined the Martins could not collect separate rent for half the garage but allocate the total cost of the garage repairs to Chilton's apartment rent.

[18] 301 Ocean Ave. Corp. v. Santa Monica Rent Control Bd., supra, 228 Cal.App.3d at page 1555.

[19] There was evidence that after the Woods moved out Ms. Martin acted as Hobson's bookkeeper thus a close relationship may have developed between Hobson and the Martins.

[20] See footnote 17, ante.

[21] Lentz v. McMahon (1989) 49 Cal.3d 393, 405.

[22] Lentz v. McMahon, supra, 49 Cal.3d at page 403.

[23] Garland v. City of Clovis (2001) 24 Cal.4th 1003, 1029.

[24] Foster v. Snyder (1999) 76 Cal.App.4th 264, 268.

[25] Foster v. Snyder, supra, 76 Cal.App.4th at page 268. The driver's duress defense was a variation on the claim "the devil made me do it." (Id. at pp. 266-267.)

[26] Timberline, Inc. v. Jaisinghani (1997) 54 Cal.App.4th 1361, 1368, footnote 5, cited in Foster v. Snyder, supra, 76 Cal.App.4th at page 267.

[27] Lentz v. McMahon, supra, 49 Cal.3d at page 402, questioning whether the doctrine of equitable estoppel could be applied to require the awarding of a government benefit to someone who is statutorily ineligible to receive it.

[28] Hope Rehabilitation Services v. Department of Rehabilitation (1989) 212 Cal.App.3d 938, 948.

[29] Failure to raise a laches defense at the administrative hearing waives the issue on review of the hearing decision. (Jenron Corp. v. Department of Social Services (1997) 54 Cal.App.4th 1429, 1437.)

[30] The affirmative defense of laches may be based on "unreasonable delay in bringing suit plus . . . acquiescence in the act about which plaintiff complains[.]" (Conti v. Board of Civil Service Commissioners (1969) 1 Cal.3d 351, 359 [footnotes omitted].)

[31] Miller v. Eisenhower Medical Center (1980) 27 Cal.3d 614, 624.

[32] The purported January 1988 letter from Hobson suggests Hobson was nonambulatory but competent to testify. The hearing officer considered this letter unreliable, however, for the reasons discussed above. See discussion at pages 8-9, ante.

[33] Hope Rehabilitation Services v. Department of Rehabilitation, supra, 212 Cal.App.3d at pages 948-949; Brown v. State Personnel Bd. (1985) 166 Cal.App.3d 1151, 1159, 1164-1165. The elements of unreasonable delay and prejudice are intertwined "because what generally makes delay unreasonable is that it results in prejudice." (Brown v. State Personnel Bd., supra, 166 Cal.App.3d at page 1159.

[34] Conti v. Board of Civil Service Commissioners, supra, 1 Cal.3d at page 359, footnotes omitted, italics added.

[35] See e.g. Gerhard v. Stephens (1968) 68 Cal.2d 864, 904 ["A defendant asserting laches on plaintiff's part must show that plaintiff has acquiesced in defendant's wrongful acts and has unduly delayed seeking equitable relief to the prejudice of defendant." (Footnote omitted.)]; Newport v. Hatton (1924) 195 Cal. 132, 148 ["It is as well settled, however, that courts of equity will often refuse relief if there has been such delay and passive neglect on the part of the complainants as, coupled with facts amounting to acquiescence in the acts complained of, will render the granting of the relief inequitable. . . . There must be present the element that the delay has been to the prejudice of the opposite party or of others." Citations omitted.]; and see 2 Pomeroy's Equity Jurisprudence (5th ed. 1941) section 419d, page 177 ["Where no one has been misled to his harm in any legal sense by the delay, and the situation has not materially changed, the delay is not fatal." Footnote omitted, citing among other cases Newport v. Hatton, supra.]

[36] Conti v. Board of Civil Service Commissioners, supra, 1 Cal.3d at page 360, citing Maguire v. Hibernia Sav. & Loan Soc. (1944) 23 Cal.2d 719, 735.