by William W. Abbott Most developers are familiar with the use of development agreements (“DAs”) as a means of memorializing a land use agreement governing development. DAs are approved following traditional land use procedures of notice, hearing and environmental review. But what about deals made at the courthouse? The appellate court recently granted rehearing of Trancas Property Owners Association v. City of Malibu (2005) 132 Cal.App.4th 1245 (click here to read Abbott & Kindermann’s November 2005 article on the case). In Trancas, the appellate court defined the limits on settlement agreements, effectively precluding terms which would otherwise be required to follow a traditional land use approval procedure. On January 31, another appellate court dealt with a new twist on judicial settlements. In 108 Holdings, LTD v. City of Rohnert Park (2006) 2006 Cal.App.Lexis 121, a property owner challenged a settlement agreement and judgment entered into between a city and citizens group regarding the City’s recently adopted general plan. The citizens’ group filed suit over the general plan, raising among other claims, a challenge to the general plan EIR. This case was settled, and pursuant to the settlement agreement, the City agreed to undertake certain actions regarding its general plan and growth related decision. One casualty of this decision was 108 Holdings, whose property was then cut out of the general plan. Next in line at the courthouse, 108 Holdings sued, arguing that the settlement constituted an amendment to the general plan adopted without following the specified statutory procedures, as well as a claim that the settlement agreement contracted away the City’s police power. The trial and appellate court rejected these claims, as this particular settlement agreement did not block the City’s legislative power to later amend its general plan (perhaps even to add 108 Holdings back in). Further, many of the challenged provisions were in implementation of the general plan, but did not amend existing policies and therefore did not run afoul of the rules on amendments. This case by no means serves as a blanket approval for all settlement agreements. As inviting as it may be to run off and sue a city or county and seek quick settlement, this case, as well as the pending Trancas decision, illustrate that the boundaries of the allowable scope of land use settlements are still being drawn. Do you want what’s in the permit, or behind courtroom #2? Come on down. William W. Abbott is a partner with Abbott & Kindermann, LLP. For questions relating to this article or any other California land use, environmental and planning issues contact Abbott & Kindermann at (916) 456-9595. The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, LLP, nor the formation of a lawyer/client relationship. Because of the changing nature of this area of the law and the importance of individual facts, readers are encouraged to seek independent counsel for advice regarding their individual legal issues.