BY MAIRE O’NEILL
maire@losalamosreporter.com
Note: The following is Part 3 of several Los Alamos Reporter articles on First Judicial District Judge Jason Lidyard’s ruling on certainly one of the biggest lawsuits against the County in recent years. The Reporter believes it is important for the community to read the extensive reasons that influenced the Court’s decision. Part 1 may be viewed at: https://losalamosreporter.com/2023/11/01/district-judge-rules-that-county-violated-sirpheys-due-process-rights-in-every-phase-of-stop-work-order-appeal/ and Part 2 at https://losalamosreporter.com/2023/11/05/judge-finds-board-of-appeals-and-county-council-acted-arbitrarily-and-capriciously-on-sirphey-stop-work-order-appeal/
BY MAIRE O’NEILL
maire@losalamosreporter.com
Part 3 of this report on Judge Jason Lidyard’s verbal ruling picks up with a portion of the transcript of Sirphey, LLC’s Prashant Jain questioning Los Alamos County Community Development Division Director Paul Andrus during the Board of Appeals hearing.
Mr. Jain: Given that you are involved with the policy and form that Section 10-73 states must be submitted by owner or lessee, why is the owner affidavit not mentioned on the affidavit we just saw.?
Mr. Andrus: Could you refer to the section again that you are referring to?
Mr. Jain: 10-73
Mr. Andrus: 10-73
Mr. Jain: Part B.2
Mr. Andrus: And your question is why is what not?
Mr. Jain: Does it say owner or lessee?
Mr. Andrus: Again, I don’t understand the question. What’s the question again to me?
Mr. Jain: 10-73, b.2 – Does it state be submitted by the owner or lessee?
Mr. Jain: Then why is it that particular form only mentions owner. It does not mention lessee?
Mr. Andrus: You know, I probably wouldn’t be able to answer that question.
“In light of the inaccuracies of this form to reflect the requirements of 10-73 b.2, it’s concerning that demands that other forms be used well and that the other form is only available at the Office of the Chief Building Official,” said Judge Lidyard.
……
Mr. Jain’s questioning of former Chief Building Inspector Michael Arellano was also cited by Judge Lidyard who read from the transcript of the Board of Appeals hearing:
Mr. Jain: Mr. Arellano, how does one appeal a decision of the Chief Building Official?
Mr. Arellano: An appeals application of the Building Official that was implemented when I went through the accreditation process. That was probably a couple of years ago.
Mr. Jain: I’ll direct your attention to Exhibit 16. Do you recognize this document?
Mr. Arellano: I do.
Mr. Jain: And what is that?
Mr. Arellano: That’s the appeal application to appeal the Building Official’s decision.
Mr. Jain: Has this form been approved by the County Manager for use?
Mr. Arellano: It has.
Mr. Jain: And where is this available?
Mr. Arellano: Here at our office.
Mr. Jain: And if somebody wants to appeal a decision of the Chief Building Official, is this the form they use?
Mr. Arellano: This is the exact form to be used.
Mr. Jain: And the form that you have discretion to make under County ordinance as necessary?
Mr. Arellano: That’s correct.
Mr. Jain: Did Sirphey file this application within the prescribed time period?
Mr. Arellano: No they did not.
Mr. Jain: So it’s your testimony today that Sirphey did not complete this appeal application?
Mr. Arellano: They did not.
Mr. Jain: This template – have you seen one?
Mr. Arellano: No I have not.
Mr. Jain: What did they submit to your understanding?
Mr. Arellano: An IPRA request.
Mr. Jain: What date was that, do you remember?
Mr. Arellano: I do not offhand.
Mr. Jain: I’ll direct your attention to Exhibit 6. Do you recognize this letter?
Mr. Arellano: I do.
Mr. Jain: And what is this letter to your understanding?
Mr. Arellano: An IPRA request.
Mr. Jain: Is there in your reading of this – is this a request for appeal?
Mr. Arellano: No it’s not. It states right on there, “I’m requesting records of your inspections”.
…..
Nov. 1 – Day 2 of Judge Lidyard’s ruling hearing
Judge Lidyard said the Court does not find that the Board of Appeals is a “Technical Board” for the following reasons:
“Rio Grande Chapter of the Sierra Club versus New Mexico Mining Commission indicates that the Court will generally defer to an agency interpretation if it implicates an agency’s expertise…This case discusses deference being to the New Mexico Mining Commission. The New Mexico Mining Commission is governed by Chapter 69 Article 36 of the New Mexico Statutes Annotated. 69-36-6 creates it, outlines its composition consisting of seven voting members,” he said.
Judge Lidyard went on to list the state-level employees and elected officials that serve on the NMMC.
“The Board of Appeals carries no such equivalence in requirements for its membership – requiring specialized training or expertize or fulfillment of certain requirements that are specific to the convening of the Board of Appeals. The Board of Appeals consists of, pursuant to County Ordinance 10-84, the Council Chair, the County Manager, and the Planning & Zoning Commission Chair. The Planning & Zoning Chair of all three members of the Board of Appeals would be the only one who may possess such expertise and qualifications equivalent to the membership I just outlined of the Mining Commission where all board members carry the expertise and background in the field. The Court finds that the Board of Appeals does not qualify as a technical board requiring deference,” Judge Lidyard said,
“Also at the outset, the Court notes that on Page 19 of the order, the Board of Appeals indicates that claims such as retaliation or disparate treatment are outside of its narrow jurisdiction. The Court does not find that there is support to that position. In fact the ordinance states in 10-81 that the Building Official – I’m quoting the very last provision of this ordinance – is to enforce the article provisions – read so as not taken out of context, ‘No such provision shall be construed as giving any discretionary powers as to what such regulations or standards shall be or power to prescribe conditions not required by this article or to enforce article provisions in an arbitrary or discriminatory manner. It then states in the last sentence regarding stop work orders that the stop work order may be revoked by the Board of Appeals of the Council. It is the Board and the Council’s responsibility to oversee its Building Official and if the Building Official is violating Section 10-81 of the ordinances by applying the provisions of this article in an arbitrary or discriminatory manner, the object of the Council to review such actions to ensure the proper oversight of the Building Official exists, and that if a stop work order is to be issued in an arbitrary or discriminatory manner, the Council has the authority to revoke that stop work order,” Judge Lidyard said.
“All that being said, the Court does find that the Board of Appeals and the County Council acted arbitrarily and capriciously in reaching its decision, and that a whole-record review reveals that the decision of the Board of Appeals and the County Council is not supported by substantial evidence. The Court begins by stating that it is irrelevant to the validity of the stop work order that the County of Los Alamos takes the position that a single permit must be obtained for all anticipated work in any commercial remodel project prior to any single portion of permit-required work. The reason why it’s irrelevant is the outcome of a failed application for a work permit is not that a stop work order should issue. The outcome of a failed application for a work permit is simply that no work permit issues. In order for a stop work order to issue, there must be a violation of either 10-80, which states that states that whenever any work is being done in violation of provisions of this article or in variance of the terms of the permit issued for such work, the Building Official may order all work on the job stopped. The NMAC lists why a work order can be issued. Nowhere does it state in the NMAC or in the ordinances that a failed application for a work permit will result in a stop work order issue,” Judge Lidyard said.
“The reason why is as acknowledged throughout the proceedings there’s work that can be on without a permit and there’s work that cannot be done without a permit. NMAC 14.5.2.9 specifically lists work that does not require a permit and the order of the Board of Appeals on Page 17 acknowledges this by stating that there was evidence of construction generally even if it’s a removable counter that is not under 5 feet 9 inches does not alone require a plumber. As a result, if there is a failed permit application it does not result in a stop work order. No permit. At that point of time the person may continue to do work that does not require a permit,” he said.
“The stop work order in this case according to the Board of Appeals was issued because work requiring a permit was being conducted. This is stated at the bottom of Page 16 of the order of the Board of Appeals under Section C, which is captioned, ‘There is overwhelming evidence that the Chief Building Official’s determination that appellant had commenced construction and alterations at 813 Central Avenue without obtaining the required permits.’ It states in the first paragraph, ‘As we identify and expose below, there is plenty of evidence that in beginning the commercial remodel of 813 Central Avenue, appellant had commenced construction or alteration of a building without a permit, warranting the Chief Building Official’s issuance of a stop work order on November 22, 2019’. And therefore the Court evaluates whether or not work was being done without a permit that required a permit being obtained after the failed application for a work permit was submitted for a work permit by Sirphey, LLC,” Judge Lidyard said.
He quoted the Board of Appeals order, which found that work had commenced by relying on case law regarding the determination of “when something commenced in the way of work and stating that one need not wait until ground is broken in order to determine that work has commenced”.
“In Footnote 3 contained in in the bottom of Page 12 of the Board of Appeals order it states ‘in reliance of City of Las Cruces vs. Rio Grande Gas Company 1967, whether construction has commenced is a question that is evaluated by all available evidence relating to the project,” Judge Lidyard said. “The Court would agree with that proposition, however the Board of Appeals acted arbitrarily and capriciously in not considering all available evidence. Also some of the bases for the Board of Appeals decision are not supported by substantial evidence.”
“With respect to arbitrariness and capriciousness, the case of Perkins vs. Department of Human Services, 1987….states that arbitrary or capricious action by an administrative agency consists of a ruling or conduct, which when viewed in light of the whole record, is unreasonable or does not have a rational basis, and is the result of an unconsidered willful and irrational choice of conduct and not the winnowing and sifting process. It goes on to say that an abusive discretion is established if the agency of lower court has not proceeded in the manner required by law, where the order or decision are not supported by the findings and the findings are not supported by evidence,” he said.
“Black’s Law Dictionary defines capriciousness as contrary to the evidence or established rules of law. With respect to substantive evidence, the Court of Appeals in Perkins states that substantial evidence in an administrative agency case requires whole record review, not a review limited to those findings most favorable to the agency order. This requires the Court to review and consider not only the evidence in support of one party’s contention but also to look at evidence which is contrary to the administrative agency’s findings. The reviewing court must then decide whether on balance the administrative agency’s decision was supported by substantial evidence. The facts upon which the Board of Appeals rested its decision regarding the commencement of work requiring a permit without obtaining a permit are contained on Pages 17 and 18 of the Board of Appeals order. The Court finds that the Board of Appeals acted arbitrarily and capriciously in considering portions of Mr. Prashant Jain’s intention while disregarding other portions of Mr. Prashant Jain’s intentions,” Judge Lidyard said.
“At the third paragraph beginning with the phrase, ‘In the kitchen’ the Court firstly notes that the first two sentences are not supported by substantial evidence. It states, ‘In the kitchen the Chief Building Official saw that appellant had moved a variety of electrical appliances into the long (inaudible) and commercial kitchen that had not been there during his March 7 visit. These appliances included such items as a range, broiler, fryer, wok, commercial fridges and freezers, steam tables, dishwasher, walk in cooler and a Type 1 hood.’ Not all of those items that are listed there as having been moved into the kitchen were moved into the kitchen; some of them were pre-existing but the Board of Appeals does not distinguish that in any way and the Board of Appeals cites to the transcript of record for the June 2020 hearing. This citation does not discuss the items that were brought into the 813 Central Avenue location versus those that were pre-existing. Reviewing the citation – this is merely a citation to what was listed in Sirphey, LLC’s permit application for the concrete work that they wanted to perform. Pursuing to a few pages before the citation before the Board of Appeals at Page 69, Ms. (Katie) Thwaits asked:
Ms. Thwaits: Isn’t it true that you submitted plans for the kitchen with this application?
Mr. Jain: I submitted the placement for various equipment – where they will go in the kitchen.
Ms. Thwaits: And these included a three-compartment sink, correct?
Mr. Jain: Yes, which was pre-existing.
“And then Ms. Thwaits goes on with the discussion about what was contained in the permit application and reveals that what was cited as a list of items that were moved into the premises by Sirphey, LLC is merely what was contained on their permit application. No distinction between what was moved in and what was pre-existing and the Board viewed every single item has having been moved in and none of them as pre-existing. One should refer to the transcript record for the June 20, 2020 proceeding…. Therefore the Court finds that this finding of fact that all of these items were moved into the kitchen is not supported by substantial evidence,” Judge Lidyard said.
“Moving on to the portion of that same paragraph immediately thereafter with respect to arbitrariness and capriciousness, it states that ‘while most of these appliances had not been connected to electricity, water or gas they had been moved into the place and the appellant claimed to connect them thinking that many of the kitchen appliances were simply plug and play. Appellant does not dispute that plumbing permits are necessary with the commercial kitchen appliances that connect to gas’. This finding of fact is arbitrary and capricious because it takes one portion of Mr. Jain’s intention that at some point in the future he planned to connect the appliances. It’s arbitrary and capricious because Mr. Jain also had intentions to obtain a work permit prior to installing any of those appliances, so simply to consider the evidence to support his intention to plan to connect the appliances, while completely disregarding his other intention to obtain a work permit for these appliances prior to installing them is arbitrary and capricious,” Judge Lidyard said.
He added that the support for Jain’s intention to obtain a permit prior to installation of any of the appliances that he planned to install in the future is contained in the following citations from the transcript for the June 11, 2020 proceeding which is all Mr. Jain’s direct testimony:
Mr. Jain: Going into the kitchen once again, I have painted, I have changed the door bars so that they are push door bars and they are ADA compliant. I have not, and I have placed the equipment, I got the equipment because I was given a certain time period from Mari Mac to get the equipment from the area. I’ve gotten it all in there, a lot of it in there. None of them have been hooked up, none of them have been attached to any walls. They consist of basic kitchen equipment. There are a couple of them – there are three refrigerators that are on wheels. There are big commercial refrigerators on wheels. There are once again, plug and play systems. There’s a fryer in there. There’s a grill, which was already left behind. I got one more grill from Mari Mac Village as part of my lease agreement. I got a wok as well from Mari Mac. These (sic) equipments are not electrical equipment. They are not plug and play, however they are moveable and as we moved them I notified Mr. Arellano back in May itself that these equipments and furniture are there. I never attempted to connect these equipments to the gas. I have never cooked a meal at Unquarked. I have gotten frozen food when I was working and heated it up in a microwave which was not installed. It is not connected to the wall. It is plug and play. It is a simple house microwave, which you plug into a wall and you press the button for how long you want to heat it up. But any assertions that I cooked food, used the stove, used the range, used the wok, used the fryer are absolutely false. They have never been connected to the gas at Unquarked while I had possession. As part of the project I have had licensed plumbers come in to have a look at the space so that they can give me a quote on how much it would cost me to connect these equipments to the gas line, which had already existed. There has always been plumbing at Unquarked. There has already been running water, even before I signed the lease. When I went in, I had to use the restroom. I did and there was running water. I have had no need to modify any pipework at Unquarked except that these commercial equipments need to be connected to the gas. I have said many times that it will be done by a commercial plumber and an application will be made to the state and a permit will be taken for the same. I have had a fire safety company come in there to give me a quote because I wanted to understand how much it would cost me and what is required to bring the hood and working with these equipment which I wanted to work in, how much gas would be required for that equipment, whether this particular hood will suffice. If not, do we change the menu or do we change the hood and questions like that. I did not install the hood. I was told I did not install that hood. That hood has always existed since the day I took over. It is safe to assume that the previous occupant of the building who has (unclear) restaurant in town did not operate a kitchen without a hood. I used the same company which certifies, which I have worked with in the past to come in and tell me what would be required and give me a quote on what would be required if assuming that these equipment which all have different BTUs. So every equipment has a certain BTU that it needs to operate. The gas line provides a total net BTU which are accessible to any kitchen. The value of the BTUs being used on the kitchen equipment can not be more than the net BTUs provided by the gas line. I had no desire to change or replace the gas line. I had no desire to change or replace the gas lone. I am happy changing my menu. I have explained to this company that here are all my equipment options, that that I have to have a fryer and I have to have a wok. Can you please tell me what can go in here which would a. fit under the hood eventually and also would satisfy all the current power ports. I asked them at the same time to look at the hood because the hood had not been used for quite some time – three years I believe. They looked at the hood and found that – once again my apologies on that. I had asked that – what I needed to do to make the hood work. And this whole exercise was done so that I – I was trying to do my homework, that SMS, the patio project was done and I could move to the kitchen. I can apply for a permit to connect the appliances to the gas, I can apply for a permit to make the hood in my final equipment compliant with the fire code of Los Alamos. This was all part of my homework – separate projects that would lead for me to apply for a permit and certificate of occupancy and as part of that permit, fire marshals would come in, verify the space and all the safety protocols would be done.
Further evidence presented to the Board of Appeals regarding Mr. Jain’s intention to seek a permit prior to installing any appliances is contained… in the record of appeal, the transcripts for the proceeding on June 29, 2020….
Ms. Thwaits: That wasn’t my question. My question to you was your application – your permit application that included everything that – the list that we just went over. Your permit application failed to provide any plumbing plans for these pieces of equipment, correct?
Mr. Jain: Incorrect. My plumbing, my permit application specifically mentions that these equipments will be connected at a later date. I also emailed Mr. Arellano confirming that those permits will be filed with the state separately as mentioned on the CDD website.
Ms. Thwaits: Where does your permit state that it will be connected at a later date?
Mr. Jain: Permission to go to exhibit 18?
Ms. Thwaits: That’s fine.
Mr. Jain: When I will say will be connected by a licensed plumber, now free-standing (unclear) equipment are not connected will be connected by a licensed plumber and I specify in the email to Mr. Arellano that a separate permit will be filed with the state, which he replied to and said that’s correct, you will need to file plumbing and electrical permits with the state.
Ms. Thwaits: So your application does not state that it will connected at a later date, does it?
Mr. Jain: Ma’am, my application is only for the concrete work. There is no plumbing which had been done and it doesn’t need to do any plumbing.
Ms. Thwaits: We’ve already established that the scope of work includes free-standing commercial bar/kitchen equipment not connected will be connected by a licensed plumber and it does not state anywhere in your application that it will be connected at a later date, does it?
Mr. Jain: No Ma’am. I testified that the scope of work includes the cement work and I also testified that it mentioned specifically the words, “I will not be doing as part of the scope of the work,” just to avoid the same conclusion which some people in the CDD or the County might have. And to make that point further because i knew that the County might confuse themselves I again emailed Mr. Arellano specifying that I will not I will not be doing electrical or plumbing and that those permits will be filed separately with the state.
Ms. Thwaits: And none of that is included on your permit, is it?
Mr. Jain: No. But Mr. Arellano had information to that information before he placed the red tad and it basically states specifically that (unclear) it is not connected and will be connected – will be!
“Further evidence presented to the Board of Appeals regarding Mr. Jain’s intention to obtain a work permit prior to installing any of the kitchen appliances is contained in… the record of appeal, the transcripts to the June 29, 2020 proceeding,” Judge Lidyard said.
Ms. Thwaits: And you provided no plumbing plans for the range, correct?
Mr. Jain: Once again, I provided to Mr. Arellano that I would be filing that permit at a later date when –
Ms Thwaits: I’m not talking about a permit, I’m talking about plans. You submitted no plumbing plans for the range, did you?
Mr. Jain: Ma’am. No. It wasn’t done. That is why there were no plans. They are not connected. They have never been connected.
Ms. Thwaits: And you provided no plumbing plans for the broiler with your application.
Mr. Jain: Once again the broiler is not connected – has never been connected.
Ms. Thwaits: And you provided no plumbing plans for the fryer, correct?
Mr. Jain: The fryer is not connected and hasn’t ever been connected.
Ms. Thwaits: And you provided no plans to do so.
Mr. Jain: I offered to provide plans when I am ready to hire a commercial plumber to submit a permit for it.
“Further evidence submitted for the Board of Appeals consideration that Mr. Jain would obtain a work permit prior to installing any of the appliances is contained in the permit application for the concrete work which states on the very first page under description of work after it outlines there will be filling of the grease trap and then one yard of concrete, it states, ‘New free-standing commercial bar/kitchen equipment (not connected – will be connected by licensed plumber),” Judge Lidyard said. “The Court finds that it’s arbitrary and capricious for the Board of Appeals to rely on only a portion of Mr. Jain’s intention that he intended to install those appliances at some point in the future while disregarding all of the evidence to support his further intention to obtain a permit prior to installing any of the appliances contained in the kitchen.”
“That addresses the entirety of the paragraph that begins with, ‘In the kitchen’ which is part of the bases for the Board of Appeals determining that work had commenced requiring a permit without having obtained a permit,” Judge Lidyard said.
Watch for Part Four which will begin with the evidence relied upon by the Board of Appeals to find that work had commenced without a permit, which required a permit.