Local boaters’ class-action lawsuit over “excessive” rent increases to stay docked at Dana Point Harbor can move forward in court, despite attempts by the harbor’s redevelopment team — and landlord — to dismiss it, an Orange County judge ruled this month.
Now staring down the road of a guaranteed legal battle, boaters anticipate subjecting the harbor’s landlord, the Dana Point Harbor Partners, to the production of documents and depositions around their decision to hike dock rates in excess of those at similar harbors in Southern California.
It’s a decision that boaters argue violates state and local laws.
Requests for comment from a redevelopment team spokesperson went unreturned Tuesday.
For months, some boaters at the harbor have questioned the math behind the sharply higher prices they’ve been paying since last October, as much as a 95% increase in some cases.
Dana Point Harbor Partners representatives — as well as County of Orange officials, such as county Supervisor Lisa Bartlett — have argued the hiked rental rates are still below the market rate.
They argue boaters should have seen the increases coming, as a stipulation in the Harbor Partners’ 2018 agreement with the County of Orange, which commits the Harbor Partners to redeveloping the 50-year-old harbor’s aging docks, commercial core, and facilities
Boaters knew the increases were coming, but argue the ones which came down were far excessive.
The redevelopment team wanted the boaters’ legal challenge dismissed, and to avoid facing the lawsuit altogether, filing a demurrer in court on March 18 which sought to shoot down the claims boaters presented in their lawsuit as insufficient to bring legal action.
Orange County Superior Court Judge Glenda Sanders didn’t agree in most cases, in a March 23 ruling on the merits of the lawsuit’s five causes of action, which are the set of allegations used to justify suing another party.
Sanders determined that boaters sufficiently argued their cause in cases like the boaters’ request for injunctive relief.
If granted by the court, it would restrict the redevelopment team from “enforcing their increase in the slip rates unless and until they do a proper survey,” said Dennis Winters, an attorney for the boaters in their class-action suit, in a Tuesday interview. His spouse is Victoria Winters, who sits on the board for the Dana Point Boaters’ Association advocacy group.
Sanders also accepted boaters’ cause for suing on the grounds that the Harbor Partners violated their harbor lease agreement with the county “by their threatened excessive slip fee rent that is not based on reasonable market rates and in violation of the law including the Public Trust Doctrine under the Tidelands Grant.”
Attorneys for the redevelopment team argued boaters failed to show how they breached their lease agreement with the county and that the contract only requires the firm to provide boaters a notice of rate increases – which they did – and the basis for them.
Sanders, in turn, wrote that accepting the redevelopment team’s interpretation of the contract would render its actual language “meaningless.”
“The Master Lease Agreement provides that rate increases must be ‘market rate pricing as reasonably determined by Lessee, provided, however, that in all events such prices shall be consistent with the limitations on pricing as mandated by the Tidelands Grant,’” Sanders wrote.
Though Sanders did side with the redevelopment team on two things:
Where boaters asserted grounds to sue because the redevelopment team caused boaters to vacate their space at the harbor, Sanders agreed with the Harbor Partners’ attorneys:
“Plaintiffs have not alleged any facts indicating that they (or anyone) vacated the premises as a result of the conduct alleged in the Complaint. Rather, Plaintiffs assert that they are ‘currently the holders of boat slips in the Dana Point Marina’ […] Plaintiffs also do not allege any facts supporting the conclusion that defendants breached some express or implied covenant, upon which the covenant to pay rent is dependent, thereby constructively evicting plaintiffs even though they have not vacated the premises.”
In one newsletter this year, the Dana Point Boaters Association estimates that, in fact, “approximately 250 to 300 boaters have left the marina. Many of them have sold their boats and others have moved to marinas in Long Beach or San Diego. All you have to do is count the stickers on the dock boxes which say, ‘No Parking Private Property.’”
“By the way, when did Dana Point Marina become private property?” read the group’s March 9 email.
Sanders also dismissed the boaters’ claim for declaratory relief, in which the court usually defines each party’s rights and legal relationship with each other.
Winters said the point of the declaratory relief is “just to make it clear the county has responsibilities to properly monitor and enforce their own agreements, which we don’t think they’re doing.”
This was the only claim boaters asserted against the county.
“Our main focus is the Dana Point Harbor Partners, not the county,” Winters said.
Still, Sanders’ ruling – while dismissing those two grounds by the boaters – also gives them the opportunity to amend their complaint if they want.
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