August 4, 2020

Volume X, Number 217

August 03, 2020

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California Executive Order Permits “Commandeering” Hotels

California Governor Newsom yesterday issued an executive order that reserves the right to commandeer hotels and other similar facilities to serve as facilities for dealing with individuals affected with Covid-19.

Under the California Emergency Services Act (Ca. Gov. Code § 8550 et seq.), the Governor is authorized to commandeer or use any private property or personnel deemed necessary in the exercise of emergency powers during a state of war or state of emergency.  The state must pay the reasonable value of the private property or personnel commandeered.

According to the executive order, the California Health and Human Services Agency and the Office of Emergency Services are supposed to identify and otherwise make available facilities that would serve as quarantine, isolation and treatment facilities for individuals suffering from Covid-19, or that have had high risk exposure and are thought to be in the incubation period.  The order directs the State to try to reach a contract or agreement with the owner, and if necessary, exercise the power to commandeer the hotel, medical facility or other temporary facility if an agreement cannot be reached. The executive order is silent on the issue of “reasonable value” pursuant to the statute.

According to published reports, the State is currently using a vacant 120 room hotel in San Carlos as the first such site. The cruise ship passengers that docked in Oakland, California earlier this week and tested positive have been under quarantine by Federal officials at that hotel.

Copyright © 2020, Sheppard Mullin Richter & Hampton LLP.National Law Review, Volume X, Number 74

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About this Author

Michael J. Roth, Real Estate, Land Use Attorney, Sheppard Mullin
Associate

Michael Roth is an associate in the Real Estate, Land Use and Environmental Practice Group in the firm's Chicago office.

Areas of Practice

Michael J. Roth concentrates his practice on commercial and residential real estate development throughout the United States, including construction and design contracts, lending and finance, and sales and acquisitions.

He has significant experience representing owners and contractors in negotiating design and construction contracts and has represented...

312-499-6312
Lawrence C. Eppley Corporate Real Estate Lawyer Sheppard Mullin Law Firm
Partner

Lawrence Eppley is a partner in the Corporate Practice Group and Office Managing Partner of the firm's Chicago office. He is also Leader of the firm's Hospitality Team.

Areas of Practice

Lawrence concentrates his practice on acquisitions, real estate finance, development, public and private finance, joint ventures and raising equity, particularly in the hospitality sector.

Previously, Lawrence was general counsel at Potbelly Sandwich Works, one of Chicago's fastest growing companies, and his clients rely on him as their principal outside legal counsel. He often works with middle-market and emerging growth companies, including those in the hospitality and restaurant sectors, and with structured and institutional finance.

Lawrence was named as one of Law360's Hospitality MVPs in both 2013 and 2016 for his extensive work in major transactions geared towards hotel development.

312.499.6302