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By Kate J. Hart and Janell M. Bogue

In County of Humboldt v. McKee (August 15, 2008) 2008 Cal.App.Lexis 1248, the Court of Appeal, First Appellate District examined the state’s Williamson Act. The court determined that Humboldt County (“County”) Williamson Act guidelines, adopted in 1978 (the “1978 guidelines”), governed a Williamson Act contract signed in 1977. This holding meant that the new owners, Buck Mountain Ranch Limited Partnership, and the McKee’s, (collectively “Mckee”) of Tooby Ranch, consisting of over 10,000 acres, violated the Williamson Act by dividing it into parcels of 160 acres in size. This size of parcel was allowed under the County’s previous guidelines (the “1973 guidelines”).
Continue Reading Guidelines Adopted Subsequent to Williamson Act Contract Are Enforceable

By Rob Hofmann

This mid-summer review of real estate cases covers three interesting matters of potentially broad application. The first case Goldstein v. Barak Construction, deals with the precarious position of unlicensed contractors. The second, Lange v. Schilling, reinforces the significance of the mandatory medication provision of the standard CAR purchase agreement. Finally, Steiner v. Thexton, wrestles with the penultimate flexible purchase agreement, and how a buyer may lose the deal absent adequate consideration.
Continue Reading Abbott & Kindermann Mid-Summer Real Estate Review

By Cori Badgley

In Skoumbas v. City of Orinda (2008) 165 Cal.App.4th 783, Konstantine and Alexandra Skoumbas claimed that damage caused by a storm drain, a portion of which was owned by the City of Orinda (“City”), amounted to a physical taking of their property. Agreeing with the City, the trial court granted the City’s motion for summary judgment on the grounds that a taking could not have occurred where the City did not own the entire storm drain. The Court of Appeal, First Appellate District reversed the trial court’s ruling and held that the fact that the City only owned a portion of the storm drain did not preclude the conclusion that a physical taking occurred. Instead, the court ruled the question is “whether the City acted reasonably in its maintenance and control over those portions of the drainage system it does own.”…
Continue Reading Full Ownership by Public Agency of Drainage Improvement Not Needed to Prove Physical Taking

By Rob Hofmann

On May 28, 2008, the Third Appellate District for the Court of Appeal hammered home that technical form over substance rules in real property purchase transactions, irrespective of the parties’ original intent. At issue was a run of the mill purchase and sale transaction, overseen by attorneys on both sides, which granted the buyer a due diligence period to inspect the property and the ability to cancel the transaction if the buyer concluded the property ultimately did not meet its specifications. In this instance, however, the seller chose to cancel the deal during the due diligence period despite the jilted buyer having already spent some $60,000 obtaining a parcel split and related entitlements. The court not only rejected the buyer’s request to enforce the contract but also required the out-of-luck buyer to pay the seller’s $80,000-plus in attorneys’ fees incurred in defense of the buyer’s challenge of the deal cancelation. Steiner v. Thexton (2008) 163 Cal. App.4th 359.Continue Reading Unsupported Option or Purchase Agreements: A Cautionary Tale

By Rob Hofmann

Plaintiffs Amanda Goldstein and Eric Mizrahi contracted with Ami Weisz and ‘his company’ Barak Construction (“Defendants”) to build a new garage and related remodeling at the projected cost of $363,000. Neither Defendant was a licensed contractor at the time the parties entered into the contract nor when work on the project commenced. Although it is unclear whether Plaintiffs were initially aware of Defendants’ licensure status, Defendants concede they were not licensed until some three months into the project. Plaintiffs contend that Defendants subsequently abandoned the project prior to completion and with material defects despite having allegedly already been paid $362,660.50.Continue Reading Contractor Subject to Prejudgment Attachment and Not Entitled to Any Compensation When Project Commenced Before Licensure

By William W. Abbott and Janell M. Bogue

As development continues to occur in areas outside of urbanized areas, developers are encountering more threatened or endangered species issues in their environmental review process under the California Environmental Quality Act (“CEQA”). A fundamental question which must be addressed is whether there are threatened or endangered species present in the project area and whether the project will affect those species.
Continue Reading Analyzing and Mitigating Biological Resources and Endangered Species Impacts Under CEQA: An Update

By Rob Hofmann

On July 21, 2008, the California Supreme Court again pointed out the potential for devastating consequences when the terms in a boilerplate contract provision are triggered. Specifically, the Court upheld a fairly typical construction contract indemnification provision that required a subcontractor to defend the general contractor for claims and arising out of the subcontractor’s work, even though a jury absolved the contractor was subsequently absolved of any liability. This even included the general contractor’s costs of suit against the subcontractor to resolve the dispute over the scope of the indemnification provision.
Continue Reading BOILERPLATE LANGUAGE BITES AGAIN – Subcontractor Must Pay Developer’s Defense Costs Despite Jury Finding Subcontractor Not Negligent

By Cori Badgley

In Los Altos Golf and Country Club v. County of Santa Clara (June 30, 2008) 2008 Cal.App.Lexis 1149, plaintiffs brought a class action demanding a refund from the County of sewer service charges paid by plaintiffs on the grounds that the fees violated Article XIII D of the California Constitution and the Health and Safety Code. Instead of allowing plaintiffs to make any substantive arguments, the County claimed that the case should be dismissed because the plaintiffs had failed to pay the fees under protest, as required by the Health and Safety Code. The Court of Appeal, Sixth Appellate District agreed with the County and dismissed the case. Sewer service charges must first be paid under protest in order to later request a refund.
Continue Reading Before Challenging Sewer Service Charges in Court, Thou Shall First Protest