EXCLUSIVE: Sheriff, City Attorney Crack Down On Foreclosure Auction Held On City Hall Steps

A city official speaks with an auctioneer for Superior Default Services Inc. about conducting business in accordance with the COVID-19 public health order.

A moment after a foreclosure auction’s start time this afternoon, a city official flanked by Sheriff’s deputies descended down the Van Ness Avenue steps of City Hall and located the auctioneer working for Superior Default Services, Inc. Would-be bidders and activists filmed a hushed conversation on their cell phones.

The official directed the auctioneer to move down to the corner to conduct his business for the sake of social distancing and stated that holding auctions on the City Hall steps has been forbidden since 2012.

Lt. Michael Kilgariff of the Sheriff’s Department read a statement to the auctioneer from the City Attorney summarizing the necessary provisions for the auction to proceed: a social distancing protocol and a document stating that the business qualifies as essential. 

The auctioneer made a phone call and went to the corner. An aide for District 11 Supervisor Ahsha Safai asked the sheriff’s if the gathering was necessary.

“This is a nonessential transaction going on,” Kilgariff said to the crowd. “The auctioneer doesn’t know what he is doing; he’s on a phone call right now. So right now I’m going to have to ask everyone to disperse for the public safety.”

The crackdown may have thwarted any bidders from picking up affordable property, but for those property owners and tenants who would have been impacted it was a reprieve.

For attorney Tom LaLanne, 72, the crackdown was sweet.

“I was very pleased that the Sheriff came out in force,” Lalanne said. “As 2 o’clock approached, I was concerned that they weren’t going to come. They were pretty serious about closing it down.”

On Tuesday, April 21, two properties owned by Lalanne’s client were sold on the City Hall steps. Footage of that auction obtained by The Light shows that social distancing guidelines were not followed.

“Under normal circumstances I would have been challenging the foreclosure sales in court,”  Lalanne said.

But many courts are closed across the state to prevent the spread of the coronavirus.

San Francisco Sheriff’s Deputies, reporters and bystanders watch over the auctioneer as he announces postponement of the day’s business.

“I think it’s amazingly insensitive and inappropriate that these auctions were going on so long,” Lalanne added. “It should have been obvious that nonjudicial foreclosures were going on. These are really important things to people’s livelihoods.”

There is a provision in the public health order that allows for residential real estate transactions. At a minimum, the business must follow social distancing and have a social distancing protocol in place. However, online transactions are preferred.

Because the auctioneer moved the location from where it was advertised, the auction, held by Superior Default Services, Inc., was postponed.

The Southern California-based corporation “has nearly 20 years of experience in the foreclosure field,” according to its website. The company operates in California, Arizona, Nevada, Washington and Oregon.

A message left for Superior Default Services Inc. was not returned by press time. However, its website lists the Van Ness Avenue entrance to City Hall as the location of its Tuesday and Thursday auctions for San Francisco County.

“Evictions are prohibited during the pandemic,” City Attorney spokesperson John Cote said via email. “The stay-safe-at-home order does allow for services that enable residential real estate transactions. The reason is to allow people to continue to purchase or rent a home so they have a place to go. However, these sales should be conducted remotely if possible.”

A screenshot of the auction held at City Hall on April 21, 2020.

The Sheriff’s Department did not have information about how many warnings were issued to auctioneers since the shelter-in-place order was issued.

In 2012, a policy prohibiting auctions on the steps of City Hall went into effect, according to Sheriff’s Department spokesperson Nancy Hayden. 

“I can tell you that when there is a policy violation, the Sheriff’s Office asks people to leave,” Hayden wrote via email.