Tentative Ruling: Joann Olejnik v. City of Santa Barbara, et al

Case Number

26CV00231

Case Type

Hearing Date / Time

Wed, 09/16/2026 - 10:00

Nature of Proceedings

Demurrer

Tentative Ruling

For Plaintiff and Petitioner Joann Olejnik: James F. Scafide, Figueroa Law Group, LLP

                            

For Defendants and Respondents City of Santa Barbara, City Council of the City of Santa Barbara, and Rebecca Bjork: John S. Doimas, Tom R. Shapiro, Delaney R. Satz, Stephen P. Wiley, Office of the City Attorney

RULING

For the reasons stated herein, the demurrer of plaintiff to defendants City of Santa Barbara, City Council of the City of Santa Barbara, and Rebeca Bjork’s Answer to Plaintiff’s Second Amended Complaint is sustained in part and overruled in part as follows:

1. The demurrer to the twelfth affirmative defense (paragraph No. 39), and to paragraphs Nos. 11, 12, 13, 14, and 18 of the City defendants’ answer, is sustained with leave to amend.
2. The demurrer is otherwise overruled.
3. Defendants City of Santa Barbara, City Council of the City of Santa Barbara, and Rebeca Bjork shall file and serve their first amended answer to plaintiff’s second amended complaint no later than September 30, 2026.

This will be a Court Trial. The Pretrial Date of 1/20/27 at 11:30 am [first witness on 1/21/27 at 9am] and the MSC Date of 12/18/26 and the SJ Motion Date of 12/9/26 are all confirmed. Please do not request a continuance.

Background

The second amended verified complaint (SAC) of plaintiff and petitioner Joann Olejnik (Plaintiff) is the operative pleading. Plaintiff asserts in the SAC, that they own property located at 18 W. Victoria Street, Unit 202 (the Property) in Santa Barbara, California, and that they bring this taxpayer action “to dismantle a systemic, multi-generational, and coercive municipal scheme[]” pursuant to which, for over a decade, the City of Santa Barbara (the City) “has bypassed the mandatory legislative process of its own Charter to impose ‘90-year rolling’ restrictive covenants that function as perpetual restraints on the alienation of real property, and that are predicated on fictitious ‘phantom math’ regarding housing costs and are enforced through a system of ‘digital blockades’ designed to coerce homeowners into surrendering their equity and constitutional privacy rights.” (SAC, ¶¶ 1-2.)

Plaintiff further alleges that, between the time she was deemed a “Qualified Purchaser” of the Property and the scheduled close of escrow, the City unilaterally and without legislative authorization changed the terms of the Alma del Pueblo project’s affordability requirements by intentionally delaying the closing of the units for the express purpose of ensuring that a 90-year “rolling” reset was inserted into the deeds in place of the previously established fixed-term restrictions. (SAC, ¶ 10.) Plaintiff was forced into a “take-it-or-leave-it” position at the eleventh hour, where the City utilized the threat of a failed escrow to coerce her into accepting a restraint on alienability. (Ibid.)

The City also purportedly utilized a “’phantom’ HOA assumption” of $483 per month when, in reality, Plaintiff’s actual documented fees were over $800 at purchase and are now $1,045.27 per month. (SAC, ¶¶ 13-14.) By ignoring actual costs, the City has forced Plaintiff into a housing cost burden that is ‘per se’ unaffordable and violates state law. (SAC, ¶ 13.) In addition, Plaintiff alleges, the City utilizes an internal database to place “digital flags” on title such that when an owner attempts to sell or refinance, the City refuses to release those holds unless the owner executes a new 90-year rolling covenant. (SAC, ¶ 18.)

The “rolling” reset together with a covenant which forbids Plaintiff from holding any interest in any other residential real estate have rendered the Property unmortgageable. (SAC, ¶¶ 15-17.) Because no lender would accept a title that resets its encumbrance duration upon sale, Plaintiff was coerced into liquidating her personal car and jewelry to provide a 40 percent cash down payment. (SAC, ¶¶ 1 & 17.)

Plaintiff filed their SAC against the City, the City Council of the City (the City Council), Rebecca Bjork (Bjork), and the County of Santa Barbara (the County) on April 15, 2026. The SAC asserts six causes of action: (1) declaratory relief; (2) quiet title; (3) writ of mandate; (4) taxpayer injunction; (5) violation of the Tom Bane Civil Rights Act (Civ. Code, § 52.1); and (5) violation of Title 42 United States Code section 1983.

On May 19, the City, the City Council, and Bjork (collectively the “City defendants”) filed an answer to the SAC, responding to its allegations and asserting sixteen affirmative defenses.

On May 21, Plaintiff filed errata to correct typographical errors in the SAC.

On June 8, the court entered an order pursuant to a stipulation by the parties to dismiss the County from the action without prejudice.

On June 29, 2026, plaintiff filed the present demurrer to the City defendants’ answer to the SAC.

The City defendants oppose the demurrer.

Analysis

“A party against whom an answer has been filed may object, by demurrer as provided in Section 430.30, to the answer upon any one or more of the following grounds:

“(a) The answer does not state facts sufficient to constitute a defense.

“(b) The answer is uncertain. As used in this subdivision, ‘uncertain’ includes ambiguous and unintelligible.

“(c) Where the answer pleads a contract, it cannot be ascertained from the answer whether the contract is written or oral.” (Code Civ. Proc. § 430.20.)

“Under general rules of civil procedure, an answer must contain ‘[t]he general or specific denial of the material allegations of the complaint controverted by the defendant’ and ‘[a] statement of any new matter constituting a defense.’ (Code Civ. Proc., § 431.30, subd. (b)(1) & (2).) ‘The phrase “new matter” refers to something relied on by a defendant which is not put in issue by the plaintiff. [Citation.] Thus, where matters are not responsive to essential allegations of the complaint, they must be raised in the answer as “new matter.”’ [Citation.]” (Quantification Settlement Agreement Cases (2011) 201 Cal.App.4th 758, 812.) “Such ‘new matter’ is also known as ‘an affirmative defense.’ [Citation.] Affirmative defenses must not be pled as ‘terse legal conclusions,’ but ‘rather . . . as facts “averred as carefully and with as much detail as the facts which constitute the cause of action and are alleged in the complaint.” ’ [Citation.]” (Id. at pp. 812-813.)

“Unlike the usual general demurrer to a complaint the inquiry is not into the statement of a cause of action. Instead it is whether the answer raises a defense to the plaintiff’s stated cause of action.” (Timberidge Enterprises, Inc. v. City of Santa Rosa (1978) 86 Cal.App.3d 873, 879-880.) “The allegations of the pleading demurred to must be regarded as true [citations]; a demurrer does not, however, admit contentions, deductions or conclusions of fact or law alleged in the pleading [citations], or the construction placed on an instrument pleaded therein [citation], or facts impossible in law [citation], or allegations contrary to facts of which a court may take judicial knowledge.” (South Shore Land Co. v. Petersen (1964) 226 Cal.App.2d 725, 732.)

 “There are, however, certain important differences between these two kinds of demurrer. An important difference is that in the case of a demurrer to the answer, as distinguished from a demurrer to the complaint, the defect in question need not appear on the face of the answer. The determination of the sufficiency of the answer requires an examination of the complaint because its adequacy is with reference to the complaint it purports to answer. [Citations.] This requirement, however, does not mean that the allegations of the complaint, if denied, are to be taken as true, the rule being that the demurrer to the answer admits all issuable facts pleaded therein and eliminates all allegations of the complaint denied by the answer. [Citations.] Another rule, particularly applicable to the case of a demurrer to the answer, is that each so-called defense must be considered separately without regard to any other defense. [Citations.] Accordingly, a ‘separately stated defense or counterclaim which is sufficient in form and substance when viewed in isolation does not become insufficient when, upon looking at the answer as a whole, that defense or counterclaim appears inconsistent with or repugnant to other parts of the answer.’ [Citations.]” (South Shore Land Co. v. Petersen, supra, 226 Cal.App.2d at pp. 733-734, fn. omitted.)

Affirmative Defenses

Plaintiff demurs to the third, fourth, and twelfth affirmative defenses.

[Note: Plaintiff addresses the affirmative defenses out of order. The court will address the arguments in the order they are presented in the memorandum of points and authorities.]

Plaintiff’s first argument is that the twelfth affirmative defense fails because plaintiff filed her action within the 30-day statutory window. (Demurrer, p. 1. 18-24.)

The twelfth affirmative defense is “State Validation Statutes” and states, in full: “For a separate and  affirmative [defense], the Complaint and each cause of action alleged therein is barred, in whole and in part, by the operative validation statutes of the [S]tate of California, Stats 2025, ch 54 (SB 735); Stats 2025, ch 55 (SB736); Stats 2025, ch 56 (SB 737) [First, Second, and Third Validating Acts of 2025.]” (Answer, ¶ 39.)

Plaintiff requests that the court take judicial notice of the three validation statutes pursuant to Evidence Code section 451, subdivision (a). The City defendants specifically do not object to the court taking judicial notice of the validation statutes. The court will take judicial notice as requested.

Plaintiff argues that the third validating act (SB 737) does not apply due to the 30-day pending litigation carveout and filing timeline. The language relied upon states: “This act shall not operate to authorize, confirm, validate, or legalize any act, proceeding, or other matter being legally contested or inquired into in any legal proceeding now pending and undetermined or that is pending and undetermined during the period of 30 days from and after the effective date of this act.”

SB 737 became effective on January 1, 2026. Plaintiff filed her original complaint on January 6, 2026, which is five days between the law taking effect and the filing of the action.

Even assuming that plaintiff’s argument would be correct regarding the allegations of the original complaint, the operative SAC contains wholly new causes of action for: (1) Taxpayer Injunction, (2) Civil Rights Violation, (3) Civil Rights Violation under Civil Code section 52.1, and (4) Civil Rights Violation under 42 U.S.C. section 1983. The SAC was filed on April 15, 2026, which is more than 30 days after the effective date of SB 737. As such, plaintiff’s first argument fails.

Plaintiff next argues that SB 735 and SB 736 are inapplicable because those sections validate: “ ‘the formation, organization, or incorporation of any public body, or for any annexation thereto, detachment or exclusion therefrom, or other change of boundaries thereof, or for the consolidation, merger, or dissolution of any public bodies, or for, or in connection with, the authorization, issuance, sale, execution, delivery, or exchange of bonds . . ..’ (SB 735, section 8.)” (Demurrer, p. 3, ll. 13-23.)

The quoted language is a small portion of SB 735.

The City defendants argue that: “the City is not and will not be relying on Section 8 of these Acts as it clearly only applies to validate the ‘formation,’ steps etc., of a public body. In focusing on Section 8 only, Plaintiff pointedly ignores Section 7(a) of both the First and Second Validating of 2025 (which are identical in each Act) which states the following: ‘This act shall operate to supply legislative authorization as may be necessary to authorize, confirm, and validate any acts and proceedings heretofore taken pursuant to authority the Legislature could have supplied or provided for in the law under which acts those acts or proceedings were taken. (Stats. 2025, ch. 54 (SB 735), § 7(a); Stats. 2025, ch. 55 (SB 736), § 7(a).)” (Opp., p. 5, ll. 7-14.) The City defendants argue that this section, of both validating acts, provides a possible defense to a claim that the City acted in some way which was “ultra vires” (acting without statutory or constitutional authority), which is what is alleged by way of the SAC.

The court agrees with the City defendants that plaintiff, by only relying on an out-of-context small portion of the validating statutes, has failed to show that the defenses lack merit on the stated grounds. As such, the demurrer will not be sustained based on plaintiff’s second argument.

Plaintiff next argues, in several separate sections, that the twelfth affirmative defense fails due to being conclusory and unsupported by facts demonstrating applicability, scope, or temporal nexus to any identified City act. The court agrees with this argument.

“Affirmative defenses must not be pled as “ ‘terse legal conclusions,’ ” but “ ‘rather . . . as facts ‘ “averred as carefully and with as much detail as the facts which constitute the cause of action and are alleged in the complaint.” ’ ” [Citation.]” (Quantification Settlement Agreement Cases (2011) 201 Cal.App.4th 758, 812-813.)

The City defendant’s mere legal conclusion, which is set forth above, is insufficient to put at issue the applicability of the affirmative defense. The City defendants must at least plead the ultimate facts of why the affirmative defense is, or may be, applicable. The demurrer to the twelfth affirmative defense will be sustained on this basis.

Plaintiff next argues that the third and fourth affirmative defenses are inapplicable to systemic taxpayer actions challenging void ultra vires acts.

The third affirmative defense is failure to exhaust administrative remedies and states, in full: “For a separate and affirmative defense, the Complaint and each cause of action alleged therein is barred, in whole and in part, by the Plaintiff’s failure to exhaust available City administrative remedies, including but not limited to, those remedies required by Code of Civil Procedure [section] 1094.5.” (Answer, ¶ 30.)

The fourth affirmative defense is failure to exhaust legal mandamus remedies and states, in full: “For a separate and affirmative defense, the Complaint and each cause of action alleged therein is barred, in whole and in part, by the applicable writ application statute of limitations period, including but not limited to, that required by Code of Civil Procedure sections 1086 and 1094.5.” (Answer, ¶ 31.)

Plaintiff’s arguments include that plaintiff is not required to utilize administrative review procedures and that she pled the futility doctrine in the SAC. In making these arguments, plaintiff is requesting that this court go beyond the pleadings, and matters of which it takes judicial notice, and make a determination that plaintiff is not required to exhaust any administrative remedies. That is not the function of a demurrer.

As plaintiff has failed to make any cogent argument or cite any persuasive authority that the third and fourth affirmative defenses are, on their face, insufficient, the demurrer to the third and fourth causes of action will be overruled.

Demurrer to Specific Paragraphs in the Answer

Plaintiff demurs to paragraphs 1, 3, 4, 11, 12, 13, 14, 15, 16, 17, 18, and 19 of the answer. Each of those paragraphs address the corresponding paragraphs of the SAC and are essentially the same, stating:

“In response to paragraph [#], that paragraph states only legal assertions to which an answer is not required. To the extent a response is required, the City generally and specifically denies each and every allegation therein.”

“(b) The answer to a complaint shall contain:

“(1) The general or specific denial of the material allegations of the complaint controverted by the defendant.

“(2) A statement of any new matter constituting a defense.” (Code Civ. Proc., § 431.30, subd. (b) (italics added).)

“If the complaint is verified, . . ., the denial of the allegations shall be made positively or according to the information and belief of the defendant.” (Code Civ. Proc., § 431.30, subd. (d).)

The disputed paragraphs of the SAC mostly contain legal conclusions and argument. For example, paragraph 1 of the SAC alleges:

“This is a taxpayer action to dismantle a systemic, multi-generational, and coercive municipal scheme. For over a decade, the City of Santa Barbara (‘City’) has bypassed the mandatory legislative process of its own Charter to impose ‘90-year rolling’ restrictive covenants that function as perpetual restraints on the alienation of real property. These covenants are predicated on fictitious ‘phantom math’ regarding housing costs and are enforced through a system of  ‘digital blockades’ designed to coerce homeowners into surrendering their equity and constitutional privacy rights. Having been forced to liquidate her personal assets to survive this administrative overreach, Plaintiff Joann Olejnik sues to halt the illegal expenditure of public funds on this unauthorized ‘Police State’ for affordable housing.”

Paragraph 1 contains no material allegations that the City defendants are required to either admit or deny. It is simply a statement of plaintiff’s position and matters that are to be determined at trial.

The majority of the SAC paragraphs in dispute are likewise lacking in material allegations that the City defendants would be required to either admit or deny. However, the first sentence of paragraph No. 11, paragraph No. 12, the first sentence of paragraph No. 13, the second sentence of paragraph No. 14, and paragraph No. 18 all contain material allegations that the City defendants must, if they do not admit the material allegations, deny either positively or according to their information and belief.

The demurrer will be sustained, with leave to amend, as to paragraphs Nos. 11, 12, 13, 14, and 18. The demurrer will otherwise be overruled.

To the extent that the City defendants deny portions of the compound allegations contained in the SAC but admit others, the City may, and should, specify which portions they admit and which they deny.