One began weeping as he told an administrative judge his experience seeing blood splattered on a car in the motel parking lot at the corner of MacArthur Boulevard and Lincoln Avenue. Another man, Nate Grover, choked back tears as he described conditions at the motel and what child guests are exposed to drug deals, prostitution and dirty rooms.

"It breaks my heart to drive by there and see that kids actually live there," he said. "It's just mind-boggling."

About 35 Dimond residents turned out for an administrative hearing at City Hall on Monday night, when City Attorney's Office employees sought to prove that Hillcrest owners are violating terms of their operating permit.

Deputy City Attorney Pelayo Llamas built a case against owners Yuming, Yufong and Kaiying Chou of Hillsborough with the help of building inspectors, police officers and neighbors under a 3-year-old law that allows the city to go after substandard hotels. If hotel owners refuse to cooperate with the city, then the city can shut down the hotel.

The Hillcrest Motel is the first to be challenged under this law, and its owners have been working with the city to correct problems there.

But according to Llamas, the Chous' management style represents a "chronic failure" to safely operate on the property. And since the Hillcrest was open before new zoning laws took effect, an independent administrative judge could impose new operating terms and conditions if the City Attorney's Office can prove there are egregious problems at the site.

Neighbor after neighbor marched to the podium to testify about how the Hillcrest negatively affects their lives. Some said they have been propositioned by drug dealers and prostitutes, while others said motel residents have thrown bottles at them.

Not one speaker offered a positive comment about the motel.

Leila Moncharsh, an attorney for a group of neighbors, said she has photographed drug deals on the property. Gun play is common, she said, as are other violent acts.

"It is the 'OK Corral' in the parking lot and courtyard," she said.

Neighbors complained for years about the motel, and this time their complaints were backed up by city experts.

City building inspector John Stewart testified he noticed so much dry rot, and air-quality and fire-hazard problems that he called the Fire Department and city asbestos management team to inspect the property.

"There is no question about it," Stewart said. "This building is in very, very poor condition."

Oakland police patrol officer Kamilah Jackson submitted an extensive list of crimes that have occurred at the hotel during the past few years, including robbery, child abuse and assault.

Yurning Chou remained silent during the testimony while his lawyer, David L. Roth, questioned some of the witnesses.

The City Attorney's Office would like the judge to impose 19 operating conditions on the property, including installing a fence and several video cameras, hiring 24-hour security, using an up-to-date guest registration system, and putting smoke detectors in each room.

If the city and Lee cannot agree on the conditions, then the judge would make a decision May 22.