complaint case no. 15cv000014 10-13-16

8/17/2019 COMPLAINT Case No. 15CV000014 10-13-16

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DONALD FREEMAN SBN 47833

City

Attorney

City of

Carmel By-The-Sea

P. 0 Box 805

Carmel, CA 93921-0805

(831) 649-5339, Ext.

II

FILED

OCT 13

2 15

TERES A. RISI

C L E R K ~ F r i j i - I E . . S U f . £ R I O R COURT

.} . - Jl

• " U l . . t i U ~

DEPUTY

CASE

MANAGEMfiNT C ONF/=flENCE

Attorney for Petitioner CITY OF CARMEL BY-THE-SEitJATE:

1- -1\a,;c l-0 f b

TIME: 9:00AM l

PLACE: Courtroom

- - - - - • 2nd

Floor

1200 Aguajito

Rd

Monterey CA 93940

MONTEREY

COUNTY

SUPERIOR COURT

MONTEREY

DIVISION

CITY OF CARMEL-BY-THE-SEA,

CALIFORNIA, a municipal corporation

Plaintiff',

VS

PACIFIC HARVEST SEAFOODS, INC.,

And DOES I through 20

Defendants.

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Case No.

COMPLAINT FOR PRELIMINARY AND

PERMANENT INJUNCTION,

ABATEMENT OF NUISANCE;

COLLECTION OF DELINQUENT

BUSINESS LICENSE TAX

DEEMED VERIFIED PURSUANT TO

CODE

OF

CIVIL

PRO EDURE§

446

INTRODUCTION AND PRELIMINARY ALLEGATIONS

I. Plaintiff, City of Carmel-by-the-Sea (herein Carmel or City ) is a municipa

corporation and general law city located within the County

of

Monterey, California.

2. At all times relevant herein and since at least 2012, Defendant Pacific Harves

Seafoods, Inc. (herein PHS ) has exis ted as a business selling and distributing high quality

1

As used

herein

the

tenns Plaintiff

and

Petitioner as well as Defendant and Respondent are used

interchangeably

due to

the combined nature

of

he Complaint.

Carmel

v.

Pacific Harvest Seafoods

Inc.

Complaint/Petition

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seafood products to restaurants, grocery stores, and resorts, primarily within the central part of th

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State

of

California, including a dozen or more properties located in Carmel.

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3 The true names and capacities, whether individual, corporate, or otherwise,

of

named

4

5

DOES I through 20 are at this time unknown to Plaintiff, who therefore sues Defendants

by

suc

6

fictitious names, and will amend this Complaint to reflect their true names and capacities when

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they have been ascertained.

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4 At all times relevant herein, PHS has possessed and maintained a certificate of for-hir

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carrier of property pursuant to CA Revenue and Taxation Code § 7232(b) which permits th

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transportation

of

property for compensation within the State.

12 5. At all times relevant herein Carmel has maintained, enforced, and published th

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Carmel-by-the-Sea Municipal Code (herein Municipal Code ), consisting of the regulatory an

penal ordinances and certain administrative ordinance of Carmel.

6 At all times relevant herein there has been in existence Municipal Code Chapters 5.04

GENERAL LICENSING PROVISIONS, and 5.08, DEFINITIONS AND INDEX OF GENERAL

BUSINESS CLASSIFICATIONS AND TAX RATE creating a Business License Permit and Ta

within the City

of

Carmel.

Specifically within those Chapters exist Sections 5.050.010

(Definitions), 5.04.020 (License Required), 5.04.030 (Evidence

of

Doing Business), 5.04.06

(Separate Offenses), 5.04.110 (Exhibiting License), 5.04.120 (License Fee Debt to City)

5.04.140 (Payment of Fees and Taxes), 5.04.180 (Licensed Business-Locations), 5.08.005 (Tax

Required), and 5.08.010 (Classifications), and at all times relevant herein those provisions hav

applied to and regulated persons or entities conducting business within the City, establishing

business license tax that is required of each person or entity conducting business within the City.

Carmel

v


Inc

Complaint Petition


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7.

Since at least and during each period of fiscal years 2012/2013, 2013/2014, 2014/2015

and 2015 to present Defendant PHS has failed to pay the required business license tax despit

demands from City that such tax be remitted.

8. PHS has admitted that it sells and has sold seafood products to business establishmen

within City.

9.

PHS alleges that it possesses a Motor Carrier Permit issued by the State of Californ

which permits PHS to carry products as a business to local establishments without payment o

local business licenses taxes. Carmel does not dispute that any business of delivering good o

products

as

a sole and separate business would be exempt from its Business License Tax

however, such tax would apply

to

anyone who, like

PHS

is delivering

the

products they r

selling to establishments within Carmel. If they were a true Motor Carrier delivering goods an

products as a business, the sellers of the goods and products themselves would be required t

possess a Carmel Business License Permit.

FIRST CAUSE OF ACTION

COLLECTION OF DELINQUENT BUSINESS LICENSE TAXES

I

0.

Plaintiff incorporates into this cause of action each and every allegation contained i

paragraphs I through 9 of this Complaint

as if

the same were set forth fully herein.

11. This cause of action is brought and prosecuted for the failure of Defendants to secure

Business License Permit and remit the requisite taxes required by that Permit to Carmel pursuan

to Municipal Code provisions set forth in Paragraph 6 above.

12. At all times mentioned herein Municipal Code§ 5.04.020 makes it unlawful for an

person, as that term is defined in § 5.04.0 I 0 to include natural persons, firms, co-partnership

corporations, or other association, to commence or carry on any kind of lawful business, trade

calling, profession or occupation without complying with ... this title.

Carmel

v


Inc

Complaint Petition

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13. Municipal Code § 5.040.030 establishes that any person who holds out or represent

that s/he is in business in the City and fails to deny that this fact is true by sworn affidavit shall b

considered in fact to be prim f cie conducting business in the City.

14. Defendant's counsel in a letter dated March

4

2015 addressed to the City Attorney,

copy of which is attached hereto, labeled EXHIBIT A and incorporated herein by this reference

admitted that PHS is in the business of selling seafood products to restaurants, grocery stores, an

resorts, including

a

dozen or more properties in Carmel-by-the Sea.

15. Each separate day that PHS conducted business by selling seafood products within th

City is deemed to

be

a separate violation

of

the City's requirement to first obtain a Busines

License Permit before conducting business pursuant to Municipal Code § 5.04.060.

16. Plaintiff is informed and believes that Defendant provided deliveries within the Cit

on a regular basis in excess

of

100 times per year since the beginning

of

the 2012/2013 fiscal yea

with the exact number subject to proof.

17. At each time during the times mentioned herein, Defendant's delivery person wa

required to possess a copy

of

the Business License issued by City at all times while delivering it

product within the City

of

Carmel pursuant to Municipal Code

§

5.04.110.

18. The amount

of

any Business License fee imposed by Chapter 5.04 and unpaid shal

deemed a debt to the City subject to collection

of

the amount

of

such fee in any court

of

competen

jurisdiction pursuant to Municipal Code § 5.04.120.

19.

The specific fee owed by Defendant annually before application

of

any late fees o

penalties is the sum of an administrative fee of $50 per year, together with an additional tax o

$1.00 per $1,000.00

of

revenue from gross sales

of

products; or an administrative fee

of

$50 X

Carmel

v


Inc

Complaint Petition

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or $200, together with estimated revenue from gross sales during this four year period o

$20,000.00 subject to proof pursuant to Municipal Code§§ 5.04.140 A and B. .

20. There is established in Municipal

Code§

5.04. 60A.l. a requirement that the Licens

Tax must be paid at all times during which business is carried on within the City, includin

periods when the business was carried on illegally due

to

a lack of a valid license.

2 .

There is established in Municipal

Code§

5.04.160A.2. a penalty

of 25

percent

of

th

tax due which shall be added to the tax liability, together with an additional penalty of 5%

to

b

added every 30 days thereafter not to exceed 50 percent of the total license tax due; applied herei

it is believed the penalty should be the sum

of

$10,000.00 for the four year period complained

o

herein.

22. The nature of Defendant's business of selling seafood products to various location

throughout the City falls within the category of "in-and-about" business as defined in Municipa

Code

5 04 0101

Pursuant to Municipal Code

§

5.04.180 each person engaged in any in-and

about business shall do so only after procuring a Business License therefore, shall have no right t

sell products or merchandise as is the case with Defendants herein without first obtaining such

License.

23. Plaintiff

is

not aware of any legitimate or legal exemption from each and ever

provision of the Municipal Code related to City's Business License Tax.

24. The City Attorney is authorized by the City Council to bring suit in the name of th

City for the recovery

of

a license tax against any person who engages in, conducts or carries o

any business .. . for which a license is required by the provisions of this title (Chapter 5.04), and

such litigation is brought to enforce collection of any license tax imposed, such persons ar

responsible to pay all costs of suit incurred by City including reasonable attorney's fee as well as

Carmel

v


Inc

Complaint Petition

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civil penalty

to

be imposed by the Court pursuant

to

Municipal Code § 5.04.230, with Cit

requesting a penalty in the sum of 1,000.00

as

both a penalty and deterrent for the 4 years

o

conducting business without a required Business License with knowledge of the existence of suc

a requirement.

25. Every person that carries on business within the City shall pay a license tax in a

amount determined by the nature of the business pursuant to Municipal Code§ 5.08.010.

26. Defendants were required to pay a license tax in the amount of 1.00 per 1,000.00

o

gross receipts per year pursuant to Municipal ode§ 5.08.010.

27. Despite the requirements

of

Municipal Code Chapter 5.08, Defendants, and each

o

them have failed and refused to pay the requisite Business License Tax after demand by the Cit

to do so.

28. Wherefore Plaintiff prays relief as set forth following.

SECOND CAUSE OF ACTION

INJUNCTIVE RELIEF TO REQUIRE COMPLIANCE WITH MUNICIPAL CODE

PROVISIONS REGARDING SECURAL OF A BUSINESS LICENSE PERMIT,

P YMENT

OF REQUIRED FEES, FURNISHING OF AN ACCOUNTING OF GROSS

RECEIPTS AND PAYMENT OF ALL DELINQUENCIES AND COSTS OF SUIT AND

ATTORNEY S FEES.

29. Plaintiff incorporates into this cause of action each and every allegation contained i

paragraphs I through 25 of this Complaint as if the same were set forth fully herein.

30. The purpose of this Cause of Action is to enjoin Defendants from conducting busines

in the City

of

Carmel without first obtaining an appropriate Business License, paying required fee

based on gross revenues, and payment of delinquent fees, costs, penalties, and attorney's fees.

Carmel

v


Inc

Complaint/Petition

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7/12

31. Defendants and each of them have conducted business in the City for more than fou

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years without benefit of a required Business License Permit and without paying required Busines

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License ta Ces.

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5

32. On numerous occasions since November 2014, numbering more than seven separat

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times Plaintiff has communicated with Defendants

and

their counsel the legal requirement tha

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prior to commencing or conducting business within the City each person including corporations

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must first obtain a Business License including Defendant PHS and that PHS alleged excuse o

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exemption was invalid and did not excuse compliance with the Business License Chapter of th

Municipal Code.

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33. Despite the demands of City Defendants and each of them has refused to comply wit

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the demands of City that they comply with the legal requirement to obtain a Business Licens

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before conducting business within the City and we believe and therefore allege that Defendan

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PHS continues to conduct business within the City unlawfully and will continue to do so until an

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unless enjoined and restrained by this Court and forced to comply with the law in this respect.

18 34. Plaintiff believes that Defendants will refuse to submit required declaration

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establishing actual gross receipts for the fiscal years since 2012/2013 to the present unless ordered

to do so and restrained by this Court.

35. Plaintiff believes that Defendants will refuse to pay delinquent sums owed by virtue

o

their failure to obtain valid Business Licenses and pay appropriate Business License Taxe

pursuant

to

Municipal Code Chapter 5.04 unless ordered

to

do

so

and enjoined from furthe

unlawful conduct in this regard by this

Court.

36. Plaintiff believes that Defendants will refuse to pay penalties for late payment of th

delinquent sums set forth in Paragraph 3 5 above and will further refuse to pay reasonabl

Carmel

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Inc

Complaint Petition

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attorney s fees for collection

o

the debts, fees, late penalties, attorney s fees and requirin

Defendants to obtain a valid Business License and pay appropriate Business License Taxes befor

conducting business in the City unless enjoined and ordered to do so by this Court.

37. Plaintiff believes that unless enjoined and restrained by this Court Defendants wil

continue to conduct business unlawfully within the City o Carmel.

THIRD CAUSE OF ACTION

ABATEMENT OF NUISANCE PER SE

38. Plaintiff incorporates into this cause o action each and every allegation contained i

paragraphs 1 through 37 o this Complaint as i the same were set forth fully herein.

39. As set forth above, Plaintiff alleges that Defendants, and each o them, have violate

numerous provisions o Municipal Code Chapters 5.04 and 5.08 regarding a requirement whic

they refuse to obey that they obtain a Business License Permit after making application and payin

a Business License Tax, with such refusal to comply with such provisions voluntary an

intentional.

40. Violation

o

a municipal code provision constitutes a public nuisance per se, and

a

such is subject to abatement via injunctive relief.

41. Plaintiff believes that Defendants and each o them will continue to disregard an

disobey the provisions cited above regarding non-compliance with Municipal Code section

establishing a mandatory requirement that they obtain a Business License Permit after payment

o

a Business License Tax, thus constituting a continuing nuisance until and unless abated by orde

o this Court.

PRAYER

WHEREFORE, Plaintiff prays judgment for:

That this Court order, adjudge and decree

as

follows:

Carmel v Pacific Harvest Seafoods Inc

Complaint Petition

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ON THE FIRST CAUSE OF ACTION;

I. That Defendant be found to be indebted to Plaintiff in the sums

of:

a. Administrative fees for four years at 50 per year for a total

o

200.

b.

Business License taxes in the sum

o

20,000.00 or

as

demonstrated by evidenc

for the four year period

o

time at the hearing

o

this matter.

c. For delinquent penalties at the rate o 50% per year on the unpaid tax, for a sum

o

10,000 or as demonstrated by evidence for this four year period

o

time at the hearing.

d.

For a civil penalty of 1 000

or

as awarded by the Court.

ON THE SECOND CAUSE OF ACTION:

I. That a preliminary and permanent injunction

1ssue

enJommg and restraining th

Defendants and anyone acting on their behalf, from conducting, allowing, permitting, or engagin

in any business activity, including the sale

o

seafood products, within the City

o

Carmel by-the

Sea without first obtaining an appropriate Business License Permit after payment

o

a corre

Business License tax;

2.

That Defendants appear before this Court at a time and place to

be

set

by

this Court, an

then and there to show cause why a preliminary injunction should not

be

issued enjoining an

restraining Defendants the anyone acting on their behalf, from conducting, allowing, permitting, o

engaging in any business activity, including the sale of seafood products, within the City

o

Carmel by-the-Sea;

3.

That Defendants be ordered to comply with the provisions

o

the Carmel Municipa

Code Chapters 5.04 and 5.08 relating to secural

o

Business License permit after payment

o

a

appropriate Business License Tax including any and all delinquent taxes, fees, penalties, an

attorney's fees;

armel v Pacific Harvest Seafoods

Inc.

Complaint Petition

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1 4. That Defendants pay civil penalties in the sum of 1000.00 or as awarded by the Cour

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and

FREEMAN

ATTORNEYS AT LAW

CARLOS STREET

7th

AND

8th

93921

831)

624 5339

in accordance with Municipal Code §5 .04.160A2.

ON THE THIRD CAUSE OF ACTION

I. The Court find that Defendants have violated

the

provisions

of

Municipal Code Chapte

5.04 and 5.08 and as such their conduct has constituted a public nuisance per se.

2.

The Court order abatement of the public nuisance by issuance of a preliminary an

permanent injunction enjoining and restraining the Defendants and anyone acting on their behalf

from conducting, allowing, permitting, or engaging in any business activity, including the sale o

seafood products, within the City of Carmel by-the-Sea without first obtaining an appropriat

Business License Permit after payment of a correct Business License tax.

FOR ALL CAUSES OF ACTION:

I

The Court award costs of suit;

2. The Court require Defendant to pay appropriate attorney's fees

as

deemed fair an

reasonable by the Court;

3. And such other and further relief as the Court deems proper.

Dated:

October . ,__, 2015

Carmel v Pacific Harvest Seafoods Inc

Complaint Petition

City Attorney

City ofCarmel-by-the-Sea

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county, or city

nd

county, shall assess, levy, or collect

an

excise or license tax of any

kind, character , or description

wh tever

upon the transportation business

conducted ... by

ny

for-hire motor

c rrier

of property.

Carmel-by-the Sea has t ken

the

position th t Pacific Harvest

is

selling its products

in the City, not acting as a for-hire

motor

c rrier of property. Please advise why the

City feels this way, factually nd legally. In making this request, Pacific Harvest

seeks to underst nd the City's position in hopes of avoiding a formal enforcement

action requiring both parties to expend considerable time and expense.

Thank you for your anticipated

cooper tion

in responding.

Regards,

Charles

D

jenkins

Cc:

Pacific Harvest Seafoods, Inc.

complaint case no. 15cv000014 10-13-16

Documents