Kahan v. City of RichmondAnnotate this Case
Kahan purchased property in Richmond at a foreclosure sale. Shortly before the sale, the city had recorded a “special assessment” lien against the property for unpaid garbage collection fees, pursuant to a municipal ordinance. When Kahan sold the property, he had to pay the delinquent garbage fees plus administrative charges and escrow fees to obtain a release of the lien. Kahan filed a class action lawsuit alleging that the city has no authority to levy “special assessments” for garbage collection charges that are “user fees” under state law and that the ordinance purporting to authorize such assessments violates state laws on lien priority. He also argued that the city’s action violated its ordinance because a garbage lien may not attach if a “bona fide encumbrancer for value” has placed a lien on the property before the garbage lien is recorded. The court of appeal affirmed the dismissal of the suit. Treatment of delinquent garbage fees as a special assessment and the recording of a lien are expressly authorized by Government Code 25831, even if garbage fees are user fees. Government Code sections 25831 and 38790.1 expressly authorize the super-priority status accorded the garbage lien, so the ordinance is consistent with statutory lien priority law. The bona fide encumbrancer exception does not apply.