Real Estate

Subscribe to Real Estate

Reserve your seat for one of four annual seminars taking place in early 2018 in Sacramento, Napa, Redding and Modesto.

In January 2018 Abbott & Kindermann, Inc. will present its 17th annual educational program for clients and colleagues interested in current land use, environmental, and real estate issues affecting commercial and residential development, agriculture, real estate transactions, easements, mining and the construction materials production industry.

A summary of 2017 case law and legislative updates includes the following hot topics for 2018:

  • Air Quality and Climate Change – Including CEQA Guidelines, Cap-And-Trade
  • Updating Land Use Entitlements
  • Endangered Species
  • Water Quality and Wetlands – Including New State Wetlands Programs
  • CEQA:  Exemptions, Baseline, Greenhouse Gases and Climate Change
  • CEQA Litigation
  • Water Rights and Supply
  • Cultural Resources
  • Mining, Oil and Gas
  • Renewable Energy
  • Environmental Enforcement
  • Hazardous Substance Control and Cleanup
  • Timber Resources
  • Real Estate Acquisition and Development
  • Subdivision Map Act

Details for each of the seminars is below.  We hope you can join us and we look forward to seeing you there.

Redding Conference (To Register for the Redding Location Click Here)

Date: Friday, January 19, 2018

Location: Hilton Garden Inn Redding, 5050 Bechelli Lane

Registration: 12:30 p.m. – 1:00 p.m.

Program: 1:00 p.m. – 4:00 p.m.

Sacramento Conference (To Register for the Sacramento Location Click Here)

Date: Friday, January 26, 2018

Location: Sacramento Hilton Arden West, 2200 Harvard Street

Registration: 8:30 a.m. – 9:00 a.m. with continental breakfast

Program: 9:00 a.m. – 12:00 noon

Modesto Conference (To Register for the Modesto Location Click Here)

Date: Friday, February 2, 2018

Location: Double Tree Hotel Modesto, 1150 Ninth Street

Registration: 12:30 p.m. – 1:00 p.m.

Program: 1:00 p.m. – 4:00 p.m.

Napa Conference (To Register for the Napa Location Click Here)

Date: Wednesday, February 7, 2018

Location: Embassy Suites, 1075 California Boulevard

Registration: 12:30 p.m. – 1:00 p.m.

Program: 1:00 p.m. – 4:00 p.m.

The registration fee for the program is $80.00. Please register early to reserve your seat. Select the links above to see registration details for each location, as they differ. MCLE and AICP CM credits are available.

Please call (916) 456-9595 with any questions.

In Murr v. Wisconsin, U.S., 137 S.Ct. 1933 (2017), the U.S. Supreme Court established a multi-factored test to determine what is the proper unit of property against which to assess whether a challenged governmental action constitutes a regulatory taking for which just compensation is owed under the U.S. Constitution. Because the test for a regulatory taking involves a comparison of the value that has been taken from the property with the value that remains in the property, the multi-factored test defines “the unit of property ‘whose value is to furnish the denominator of the fraction.’”

In Murr, Petitioners owned two adjacent lots–Lot E and Lot F–along the lower portion of a river in Wisconsin that is protected under local state and federal law. State and local regulations prevented the use or sale of adjacent lots as separate building sites unless they have at least one acre of land suitable for development. Both lots were over one acre in size, but each had less than one acre suitable for development due to their topography. The unification of the lots under the Petitioners’ common ownership implicated the rules barring their separate sale or development. Petitioners considered selling Lot E as part of an improvement plan for the lots, and sought variances from the existing regulations from a local agency. However, that agency denied the variance request and the state courts affirmed on the ground that the regulations effectively merged the lots for sale or development purposes.

Petitioners filed suit in state court against the State of Wisconsin on the ground that the merger regulations were a taking under the U.S. Constitution because the regulations deprived Petitioners of all, or practically all of the use of Lot E since the lot cannot be sold or developed as a separate lot under the regulations. The trial court granted summary judgment to the State on the ground that Petitioners had other options to enjoy and use their properties. The trial court also found that Petitioners had not been deprived of all economic value of their property because the decrease in market value of the unified lots was less than 10 percent. The Wisconsin Court of Appeals affirmed summary judgment. The U.S. Supreme Court granted certiorari and affirmed.

Writing for the 5-3 majority, Justice Kennedy described the key legal question in the case as follows:

What is the proper unit of property against which to assess the effect of the challenged governmental action? Put another way, “[b]ecause our test for regulatory taking requires us to compare the value that has been taken from the property with the value that remains in the property, one of the critical questions is determining how to define the unit of property ‘whose value is to furnish the denominator of the fraction.’” [Citations omitted.]

The majority rejected each of the formalistic rules advocated by the State and Petitioners because “the question of the proper parcel in regulatory takings cases cannot be solved by any simple test.” Justice Kennedy stated that no single consideration can supply the exclusive test for determining the denominator. That is because of the competing constitutional principles underlying the Takings Clause. Justice Kennedy explained:

A central dynamic of the Court’s regulatory takings jurisprudence, then, is its flexibility. This has been and remains a means to reconcile two competing objectives central to regulatory takings doctrine. One is the individual’s right to retain the interests and exercise the freedoms at the core of private property ownership. Property rights are necessary to preserve freedom, for property ownership empowers persons to shape and to plan their own destiny in a world where governments are always eager to do so for them.

The other persisting interest is the government’s well-established power to “adjus[t] rights for the public good.” In adjudicating regulatory takings cases a proper balancing of these principles requires a careful inquiry informed by the specifics of the case. In all instances, the analysis must be driven “by the purpose of the Takings Clause, which is to prevent the government from ‘forcing some people alone to bear public burdens which, in all fairness and justice, should be borne by the public as a whole.’”.

In light of those countervailing public policies, Justice Kennedy stated that courts must consider a number of factors in making the “denominator” determination:

[W]hether reasonable expectations about property ownership would lead a landowner to anticipate that his holdings would be treated as one parcel, or, instead, as separate tracts. The inquiry is objective, and the reasonable expectations at issue derive from background customs and the whole of our legal tradition.

The majority held that the factors to be considered in such an analysis are the following.

First, courts should give substantial weight to the treatment of the land, in particular how it is bounded or divided, under state and local law. This factor recognizes that “reasonable expectations of an acquirer of land must acknowledge legitimate restrictions affecting his or her subsequent use and dispensation of the property.” Therefore, a reasonable restriction that predates a landowner’s acquisition can be one of the objective factors that most landowners would reasonably consider in forming fair expectations about their property.

Second, courts must look to the physical characteristics of the landowner’s property. Such characteristics include the physical relationship of any distinguishable tracts, the parcel’s topography, and the surrounding human and ecological environment. For example, the property’s location in an area that is subject to, or likely to become subject to, environmental or other regulation is a relevant consideration.

Third, courts should assess the value of the property under the challenged regulation, with special attention to the effect of burdened land on the value of other holdings. Though a use restriction may decrease the market value of the property, the effect may be tempered if the regulated land adds value to the remaining property, such as by increasing privacy, expanding recreational space, or preserving surrounding natural beauty.

Applying that multifactor standard, the majority held in this case that Petitioners’ property should be evaluated as a single parcel consisting of Lots E and F together. The Court reasoned that (1) The treatment of the property under state law indicates petitioners’ property should be treated as one when considering the effects of the restrictions; (2) the physical characteristics of the property support its treatment as a unified parcel; (3) the prospective value that Lot E brings to Lot F supports considering the two as one parcel for purposes of determining if there is a regulatory taking; and (4) the special relationship of the lots is shown by their combined valuation. Therefore, the Court held that the Wisconsin Court of Appeals was correct in analyzing petitioners’ property as a single unit.

The Court further held that, by considering Petitioners’ property as a whole, the state court was correct to conclude that petitioners cannot establish a compensable taking in these circumstances. Petitioners had not been deprived of all economically beneficial or productive use of their property (Lucas v. South Carolina Coastal Council, 505 U.S. 1003 (1992)), and they failed to establish that they suffered a taking under the more general test of Penn Central Trans. Co. v. New York City (1978) 438 U.S. 104.

In dissent, Chief Justice Roberts advocated sticking with “our traditional approach,” under which “[s]tate law defines the boundaries of distinct parcels of land, and those boundaries should determine the ‘private property’ at issue in regulatory takings cases.” Justice Roberts complained that the majority decision “knocks the definition of ‘private property’ loose from its foundation on stable state law rules and throws it into the maelstrom of multiple factors that come into play at the second step of the takings analysis.” In short, the dissent believed that the new framework established by the majority “compromises the Takings Clause as a barrier between individuals and the press of the public interest.”

Glen Hansen is a Senior Counsel at Abbott & Kindermann, Inc. For questions relating to this article or any other California land use, real estate, environmental and/or planning issues contact Abbott & Kindermann, Inc., at (916) 456-9595.

The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, Inc., or 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.

 

By Glen Hansen

In Gion v. City of Santa Cruz (1970) 2 Cal.3d 29, the California Supreme Court held that private owners of certain coastal property who allowed the public to use the property for recreational purposes over a period of years thereby impliedly dedicated property rights to the public. The Legislature responded to Gion by enacting Civil Code section 1009. That section generally provides that “no use” of private noncoastal property after the legislation’s effective date of March 4, 1972, will give rise to “a vested right” in the public to continue using the property permanently, unless the property owner makes an express, irrevocable offer to dedicate the property to public use. In Scher v. Burke (2017) 3 Cal.5th 136, the California Supreme Court resolved a dispute between the Courts of Appeal and held that section 1009 bars all use of non-coastal private real property, not simply recreational use of such property, from ever ripening into an implied dedication to the public after March 4, 1972.

In Scher, Plaintiffs owned property along Henry Ridge Motorway, which is located in the unincorporated Topanga Canyon area in the Santa Monica Mountains in Los Angeles County. Plaintiffs purchased their property along Henry Ridge Motorway in 1998 with a 1948 easement that only gave them access to the north. Defendants’ properties were located south of Plaintiffs’ property along Henry Ridge Motorway and/or along an adjacent road.

Much of the case concerned whether and in what manner Henry Ridge Motorway and the adjacent road were used by the public. When Pauline Stewart, the “matriarch of Henry Ridge,” moved to Henry Ridge Motorway in 1977, it was merely a “fire road.” In 1984, the Los Angeles County Fire Department notified Stewart that it would no longer maintain the road because the “County had designated it as a private road.” Stewart described Henry Ridge Motorway in a 1988 letter as “a road on private property so it is considered a private road, it is not a public thoroughfare, even though it is open to the public for all practical purposes.” In the past, several Defendants recorded irrevocable offers to dedicate easements to the public for a hiking and/or an equestrian trail over those portions of Henry Ridge Motorway that crossed over Defendants’ properties. Defendants have also sought to limit public access over Henry Ridge Motorway and the adjacent road south of Plaintiffs’ property, including locking gates, “religiously” stopping drivers on those roads that they did not recognize, and placing signs that forbid trespassing or state “No access to Henry Ridge Road. Locked gates ahead.”

Plaintiffs alleged, among other things, Defendants have acquiesced to the dedication to public use of the entirety of Henry Ridge Motorway and the adjacent road across defendants’ properties, and that Plaintiffs are entitled to use Henry Ridge Motorway and the adjacent road as a public street. The Superior Court for Los Angeles County held, among other things, that Henry Ridge Motorway and the adjacent road had been impliedly dedicated as public streets under Civil Code section 1009. Defendants appealed part of the judgment. The Court of Appeal reversed the implied dedication part of the judgment in a published portion of its decision. The California Supreme Court affirmed the decision of the Court of Appeal, and remanded to the Superior Court for entry of judgment in favor of Defendants.

In 1971, the Legislature enacted Civil Code section 1009 to restrict the common law implied dedications to the public. Subdivision (b) of that section declares that

“no use of such property by the public after the effective date of this section shall ever ripen to confer upon the public or any governmental body or unit a vested right to continue to make such use permanently, in the absence of an express written irrevocable offer of dedication of such property to such use, made by the owner thereof in the manner prescribed in subdivision (c) of this section, which has been accepted by the county, city, or other public body to which the offer of dedication was made … .”

That statutory restriction was made effective March 4, 1972.

Several cases included language and/or dicta that section 1009, subdivision (b), applied only to recreational uses from developing into an implied public dedication. (See Hanshaw v. Long Valley Road Assn. (2004) 116 Cal.App.4th 471; Pulido v. Pereira (2015) 234 Cal.App.4th 1246; Bustillos v. Murphy (2002) 96 Cal.App.4th 1277.) In Scher, the Court of Appeal disagreed with the language in those cases, and held that section 1009, subdivision (b), barred all public use, not just recreational use, from developing into an implied public dedication. The Supreme Court granted review to resolve that disagreement among the Courts of Appeal.

The Court held that section 1009, subdivision (b), applies to non-recreational use of roadways for vehicle access as it applies to recreational use of other private noncoastal property. The Court reviewed the explicit language, legislative concerns, general legislative scheme and legislative history of the statute, and concluded that “section 1009, subdivision (b) contains no implicit exception for non-recreational use of roadways.” In so holding, the Court disapproved Hanshaw, Pulido and Bustillos to the extent they are inconsistent with the Court’s opinion.

So at the end of the litigation, the Supreme Court essentially followed the testimony of the “matriarch of Henry Ridge.” Ms. Stewart testified that she was unaware of facts that would show that the general public had used Henry Ridge Motorway, over the adjacent road, to access a public road. She added: “I don’t know anybody in their right mind that would even try to go that way.” Apparently, everyone ended the case in their right mind.

Glen Hansen is a Senior Counsel at Abbott & Kindermann, Inc. For questions relating to this article or any other California land use, real estate, environmental and/or planning issues contact Abbott & Kindermann, Inc., at (916) 456-9595.

The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, Inc., or 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.

Reserve your seat for one of four seminars taking place in early 2017.

In January 2017 Abbott & Kindermann, Inc. will present its 16th annual educational program for clients and colleagues interested in current land use, environmental, and real estate issues affecting commercial and residential development, agriculture, real estate transactions, easements, mining and the construction materials production industry.  

A summary of 2016 case law and legislative updates includes the following hot topics for 2017:

  • Air Quality and Climate Change: including CEQA Guidelines and Mandatory Reporting
  • Mining
  • Updating Land Use Entitlements
  • Endangered Species
  • Water Quality and Wetlands
  • Water Rights and Supply
  • Cultural Resources
  • Renewable Energy
  • Environmental Enforcement
  • Hazardous Substance Control and Cleanup
  • Timber Resources
  • CEQA:  Exemptions, Baseline, Greenhouse Gases and Climate Change
  • CEQA Litigation
  • Real Estate Acquisition and Development

Abbott & Kindermann, Inc. will present its annual program at four locations: Redding, Sacramento, Modesto, and Napa.  Details for the seminars are below.  We hope you can join us and we look forward to seeing you there.

Redding Conference  (To Register for the Redding Location Click Here)

Date: Wednesday, January 11, 2017

Location: Hilton Garden Inn Redding, 5050 Bechelli Lane

Registration: 12:30 p.m. – 1:00 p.m.

Program: 1:00 p.m. – 4:00 p.m.

Sacramento Conference  (To Register for the Sacramento Location Click Here)

Date: Friday, January 20, 2017

Location: Sacramento Hilton Arden West, 2200 Harvard Street

Registration: 8:30 a.m. – 9:00 a.m. with continental breakfast

Program: 9:00 a.m. – 12:00 noon

Modesto Conference  (To Register for the Modesto Location Click Here)

Date: Friday, January 27, 2017

Location: Double Tree Hotel Modesto, 1150 Ninth Street

Registration: 12:30 p.m. – 1:00 p.m.

Program: 1:00 p.m. – 4:00 p.m.

Napa Conference  (To Register for the Napa Location Click Here)

Date: Tuesday, January 31, 2017

Location: Embassy Suites, 1075 California Boulevard

Registration: 12:30 p.m. – 1:00 p.m.

Program: 1:00 p.m. – 4:00 p.m.

The registration fee for the program is $80.00. Please register early to reserve your seat. Select the links above to see registration details for each location, as they differ. MCLE and AICP CM credits are available (approval pending).

Please call (916) 456-9595 with any questions.

Reserve your seat for one of four seminars taking place in early 2017.

In January 2017 Abbott & Kindermann, LLP will present its 16th annual educational program for clients and colleagues interested in current land use, environmental, and real estate issues affecting commercial and residential development, agriculture, real estate transactions, easements, mining and the construction materials production industry.  

A summary of 2016 case law and legislative updates includes the following hot topics for 2017:

  • Air Quality and Climate Change: including CEQA Guidelines and Mandatory Reporting
  • Mining
  • Updating Land Use Entitlements
  • Endangered Species
  • Water Quality and Wetlands
  • Water Rights and Supply
  • Cultural Resources
  • Renewable Energy
  • Environmental Enforcement
  • Hazardous Substance Control and Cleanup
  • Timber Resources
  • CEQA:  Exemptions, Baseline, Greenhouse Gases and Climate Change
  • CEQA Litigation
  • Real Estate Acquisition and Development

Abbott & Kindermann, LLP will present its annual program at four locations: Redding, Sacramento, Modesto, and Napa.  Details for the seminars are below.  We hope you can join us and we look forward to seeing you there.

Redding Conference  (To Register for the Redding Location Click Here)

Date: Wednesday, January 11, 2017

Location: Hilton Garden Inn Redding, 5050 Bechelli Lane

Registration: 12:30 p.m. – 1:00 p.m.

Program: 1:00 p.m. – 4:00 p.m.

Sacramento Conference  (To Register for the Sacramento Location Click Here)

Date: Friday, January 20, 2017

Location: Sacramento Hilton Arden West, 2200 Harvard Street

Registration: 8:30 a.m. – 9:00 a.m. with continental breakfast

Program: 9:00 a.m. – 12:00 noon

Modesto Conference  (To Register for the Modesto Location Click Here)

Date: Friday, January 27, 2017

Location: Double Tree Hotel Modesto, 1150 Ninth Street

Registration: 12:30 p.m. – 1:00 p.m.

Program: 1:00 p.m. – 4:00 p.m.

Napa Conference  (To Register for the Napa Location Click Here)

Date: Tuesday, January 31, 2017

Location: Embassy Suites, 1075 California Boulevard

Registration: 12:30 p.m. – 1:00 p.m.

Program: 1:00 p.m. – 4:00 p.m.

The registration fee for the program is $80.00. Please register early to reserve your seat. Select the links above to see registration details for each location, as they differ. MCLE and AICP CM credits are available (approval pending).

Please call (916) 456-9595 with any questions.

 

Walters v. City of Redondo Beach (2016) 1 Cal.App.5th 809.

By Brian Russell

Auto-Spa applied for a conditional use permit to build a car wash and coffee shop in Redondo Beach, California. The property is zoned commercial. The project consisted of a 90-foot car wash tunnel and an attached coffee shop totaling 4,080 square feet. The rest of the property would be used for drying and parking cars. Entry to the car wash was from a residential street, just off of a major street. From 1965 to 2001, there was a car wash on the property.

The Planning Commission approved the project under a categorical exemption in CEQA Guidelines section 15303(c).  That provided an exemption from CEQA review for commercial buildings not exceeding 10,000 square feet in floor area on sites zoned for such use if not involving the use of significant amounts of hazardous substances, where all necessary public services and facilities are available and the surrounding area is not environmentally sensitive.

After an appeal and approval by city council, Appellants filed a petition challenging the CEQA exemption. The trial court ruled in favor of the city.

On appeal, the initial issue was whether the project qualified as a commercial structure and met the square footage limitations of the CEQA exemption. In reviewing the determination of whether a project fits within an exemption, the court applied the substantial evidence test and agreed with the city that the exemption embraced a broad range of commercial projects. The appellant also urged that the use of hazardous materials was not allowed in conjunction with the exemption. However, the evidence did not support this argument, and that the argument was based upon speculation.

Appellants then argued that even if the exemption applies, it should not apply for this project because “there is a reasonable possibility that the activity will have a significant effect on the environment due to unusual circumstances.”  Under the Berkeley Hillside Preservation v. City of Berkeley (2015) 60 Cal.4th 1086 (“Berkeley Hillside”), a challenger must prove both the unusual circumstances and a significant environmental effect that is due to those circumstances. If unusual circumstances are found, agencies apply the fair argument standard in determining whether there is a reasonable possibility of a significant effect on the environment due to unusual circumstances. Alternatively, under Berkeley Hillside, a challenger may establish an unusual circumstance with evidence that the project will have a significant environmental effect, applying the traditional substantial evidence test. Here, the court explained that a party can show an unusual circumstance by demonstrating that the project has some characteristic or feature that distinguishes it from others in the exempt class, such as its size or location. But the court concluded that there is nothing particularly unusual about the proposed car wash and coffee shop. The evidence establishes that there are many other car washes in the surrounding area, plus the site itself was a car wash and snack bar for nearly 40 years, which suggests that this project is not an unusual circumstance.

The court further analyzed whether the plaintiffs had established that the unusual circumstances will have a significant environmental effect. The plaintiffs argued that the operation of the car wash would violate the city’s interior and exterior noise limits at the abutting property line. However, the court rejected that argument, and found that the exceedance will not occur, because the project was conditioned upon the car wash’s adherence to the city’s noise standards. Furthermore there was an additional condition that provides that compliance with the noise requirements “shall be tested and documented prior to the final inspection and opening of the car wash operation.” Given those conditions and assurances, plaintiffs failed to meet their burden of showing that the project will actually have a significant environmental effect.

Plaintiffs then argue that the project will have a significant impact on traffic. They argued that the design of the car wash is inefficient and will cause back ups within the project property. However, the court held that plaintiffs’ argument was speculative and was contradicted by both the plaintiffs’ expert and the city’s findings that any such backup could be avoided by managing the flow of cars through the car wash. The court found that, at best, plaintiffs provided evidence that suggests that the project possibly could have a periodic impact on traffic. That was insufficient. The court held that plaintiffs failed to provide evidence that the project will actually have a significant impact on the environment by causing a substantial adverse change in the physical conditions that exist in the area.

With that holding, the court concluded that plaintiffs failed to establish the unusual circumstances exception under the Berkeley Hillside alternative analysis. Therefore, the city properly determined that the car wash project is categorically exempt under the CEQA Guidelines.

Brian Russell is an attorney at Abbott & Kindermann, LLP.  For questions relating to this article or any other California land use, real estate, environmental and/or planning issues contact Abbott & Kindermann, LLP at (916) 456-9595.

The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, LLP, or 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.

 

Mark your calendar – registration for Abbott & Kindermann’s 16th Annual Land Use, Real Estate, and Environmental Law Update will open on October 18, 2016.

In January 2017 Abbott & Kindermann, LLP will present its 16th annual educational program for clients and colleagues interested in current land use, environmental, and real estate issues affecting commercial and residential development, agriculture, real estate transactions, easements, mining and the construction materials production industry.  

A summary of 2016 case law and legislative updates includes the following hot topics for 2017:

  • Air Quality and Climate Change: including CEQA Guidelines and Mandatory Reporting
  • Mining
  • Updating Land Use Entitlements
  • Endangered Species
  • Water Quality and Wetlands
  • Water Rights and Supply
  • Cultural Resources
  • Renewable Energy
  • Environmental Enforcement
  • Hazardous Substance Control and Cleanup
  • Timber Resources
  • CEQA:  Exemptions, Baseline, Greenhouse Gases and Climate Change
  • CEQA Litigation
  • Real Estate Acquisition and Development

Abbott & Kindermann, LLP will present its annual program at four locations: Redding, Sacramento, Modesto and Napa.  Details for the seminars are below.  We hope you can join us and we look forward to seeing you there.

Redding Conference 

Date: Wednesday, January 11, 2017

Location: Hilton Garden Inn Redding, 5050 Bechelli Lane

Registration: 12:30 p.m. – 1:00 p.m.

Program: 1:00 p.m. – 4:00 p.m.

Sacramento Conference 

Date: Friday, January 20, 2017

Location: Sacramento Hilton Arden West, 2200 Harvard Street

Registration: 8:30 a.m. – 9:00 a.m. with continental breakfast

Program: 9:00 a.m. – 12:00 noon

Modesto Conference 

Date: Friday, January 27, 2017

Location: Double Tree Hotel Modesto, 1150 Ninth Street

Registration: 12:30 p.m. – 1:00 p.m.

Program: 1:00 p.m. – 4:00 p.m.

Napa Conference 

Date: Tuesday, January 31, 2017

Location: Embassy Suites, 1075 California Boulevard

Registration: 12:30 p.m. – 1:00 p.m.

Program: 1:00 p.m. – 4:00 p.m.

The registration fee for the program is $80.00. MCLE and AICP CM credits are available (approval pending).

Please call (916) 456-9595 with any questions.

 

By Glen Hansen

Friends Of Martin’s Beach v. Martin’s Beach 1, LLC (2016) 246 Cal.App.4th 1312

In a dispute between a plaintiff unincorporated association asserting public rights and defendant property owners over the use of a road, parking area and the inland dry sand of a popular beach that were owned by defendants, the Court of Appeal for the First Appellate District in Friends Of Martin’s Beach v. Martin’s Beach 1, LLC (2016) 246 Cal.App.4th 1312, 2016 Cal.App.LEXIS 341, held: (1) that the trial court properly granted summary adjudication as to plaintiff’s claim that Article X, section 4, of the California Constitution, confers on the public a right of access over private property to tidelands; and (2) that the trial court erred in granting summary adjudication as to plaintiff’s claim that, under the theory of common law dedication, the owner’s predecessors dedicated such access to the public through their words and acts, and that the public accepted that offer by using those parts of defendants’ property.

The Martin’s Beach case involved two parcels of land bounded on the east by Highway 1 and on the west by the Pacific Ocean (“Property”). At the western edge of the Property is a crescent-shaped strip of land known as “Martin’s Beach.” The only land access to Martin’s Beach is via a road that runs across the Property from Highway 1 to the beach. The Property was once part of a larger tract of land that was provisionally granted by the Mexican Governor of California in 1838 (“Rancho”).  The grant was not finalized by the time war broke out between Mexico and the United States in 1848. The Treaty of Guadalupe Hidalgo ended the war, and in 1851, Congress passed legislation to implement the Treaty. The 1851 Act established the process to address pre-war land claims.  Claims that were confirmed in those proceedings resulted in a federal patent, which is the equivalent of a deed from the federal government conveying fee simple ownership.  A patent claim for the Rancho was eventually confirmed in such patent proceedings, and by the United States Supreme Court on appeal.  Over time, the Rancho was divided into smaller parcels, including the Property, and conveyed to various persons. 

The Property was eventually acquired by the Deeney family.  The Complaint in this case alleged that, from the 1930s or earlier, the Deeney family invited the public to use the beach and the road to the beach both by words and conduct, specifically by posting a large billboard on the highway inviting the public to come to the beach by way of the road, by “welcom[ing] all ‘with open arms,’” and by constructing public toilets, a parking area and a convenience store catering to those who visited the beach.  For some of that time they charged a 25ȼ parking fee.  The Complaint also alleged: “Postcards from the ‘50s show hundreds of people enjoying idyllic days at a beach that at times had the feel of a Mediterranean escape.” “In more recent years, surfers, in particular, enjoyed what the website Surfpulse refers to as a ‘mystical and multi-faceted playground’ and what Save the Waves’ program director called ‘a natural theme park with sand.’”  The Deeney family sold the Property to defendants Martin’s Beach 1, LLC and Martin’s Beach 2, LLC (“Owners”) in 2008.  In 2009, the Owners locked a gate barring the entrance to the road, placed “No Trespassing” signs there and otherwise prevented the public from using the road or the beach.

Plaintiff Friends of Martin’s Beach, an unincorporated association (“Plaintiff”), filed a complaint against the Owners “on behalf of the general public,” citing numerous legal theories and causes of action in order to assert “nonexclusive rights and interests acquired by the general public in the beach to high tide at Martin’s Beach, the dry sand inland, an inland area historically used for parking and access along Martin’s Beach Road.”  In response to the parties’ cross-motions for summary adjudication, the trial court ruled in favor of Owners on all of the public access issues.  Plaintiff appealed.  The Court of Appeal affirmed in part, reversed in part, and remanded the case to the trial court on the public dedication claim. 

Plaintiff’s Constitutional Claims For Public Access

Plaintiff argued that Article X, section 4, which was adopted by the People as part of the Constitution of 1879, entitled the public to an easement to use the road across the Property for the purpose of gaining access to the tidelands.  That section 4 provides:

 

No individual, partnership, or corporation, claiming or possessing the frontage or tidal lands of a harbor, bay, inlet, estuary, or other navigable water in this State shall be permitted to exclude the right of way to such water whenever it is required for any public purpose, nor to destroy or obstruct the free navigation of such water; and the Legislature shall enact such laws as will give the most liberal construction to this provision, so that access to the navigable waters of this State shall be always attainable for the people thereof. 

However, the Court of Appeal affirmed the trial court’s conclusion that, whatever public rights exist under section 4 (that issue was not decided), do not override the federal land patent title in the Owner in light of Summa Corp. ex rel. Lands Commission v. California (1984) 466 U.S. 198.   In Summa, the U.S. Supreme Court held that the State of California acquired no public trust interest in lands to which title was confirmed under the federal Act of 1851 patent process based on a Mexican land grant, unless such interest was asserted by the State in the patent proceedings.  Here, Plaintiff’s cause of action based on section 4 was barred under Summa because California did not acquire a public interest in the Property.  That was so because the State did not assert any such interest during the patent proceedings for the Rancho in the 1850s.  In response to Plaintiff’s attempts to distinguish Summa, the Court further held (1) that the provisional nature of the Mexican land grant for the Rancho did not alter the conclusive application of Summa; (2) that section 4 is, at least in part, a codification of the public trust doctrine; and (3) that section 4 is not a mere regulation of an “incident of ownership.”  Thus, Plaintiff’s constitutional claim based on section 4 was barred under Summa.  The Court also explicitly rejected Plaintiff’s alternative argument that section 4 is retroactive and burdens lands held in private ownership before its enactment. Not surprisingly, counsel for the owner called the Court of Appeal’s ruling on the section 4 claim, which ruling rejected the idea of a guaranteed right of beach access under the California Constitution, “a win for our client and for all coastal property owners.”

Plaintiff’s Common Law Dedication Claim For Public Access

The Court of Appeal held that the trial court erred in granting summary adjudication as to Plaintiff’s common law dedication claim.  A common law dedication is a “grant and a gift” of land or an interest in land to the public for a public use.  A claim for dedication has two elements: “intention to dedicate by the owner, and acceptance by the public.” To constitute a dedication at common law no particular formality of either word or act is required. All that is necessary is sufficient evidence that the property owner either expressly or impliedly manifested an unequivocal intention to offer the property for a public purpose and that there was an acceptance of the offer by the public. Such intent may be demonstrated in any conceivable way that a person’s intention can be shown.  Similarly, the acceptance element may be formal, as by resolution or ordinance, or by use.  Here, the Court rejected the Owner’s singular focus on the “express” dedication label that was used in Plaintiff’s Complaint. The elements are the same for either an implied or an express dedication; the only difference is in the mode of proof of the intent element. Contrary to the Owners’ argument, the “intent to dedicate” element in an express dedication may be established by words or overt conduct of an owner other than a grant deed to a public agency or similar formal writing.  Also contrary to the Owners’ argument, an express dedication does not need to be accepted in a formal way or by a public entity. Here, the Court of Appeal held that “there can be little doubt that the facts [Plaintiff] alleged are sufficient to establish the elements of common law dedication, if they can be proven at trial. The complaint alleged a number of acts on the part of the owners that could manifest an intent to dedicate to the public, coupled with public use over many decades that could establish acceptance.” 

Furthermore, it was error for the trial court to conclude, as a matter of law, that the fact that the Deeneys “at some point charged a fee” to the public negated any intent to dedicate.  Evidence of such permissive use may tend to show the owner intended to control or qualify other parties’ access to the property and thereby rebut a finding of dedicative intent.  But that was a triable issue of fact.  Also, the Court held that the trial court erred when it inferred that the Deeneys’ commercial purpose for inviting the public to use the road and beach negated the intent to dedicate the road or beach, as a matter of law.  In fact, such commercial purpose may support a finding of intent to dedicate.

Accordingly, the Court held that Plaintiff alleged facts sufficient to state a common law dedication claim, and the Owners failed to show, as a matter of law, that they are entitled to judgment on this cause of action. The Court remanded the case to the trial court to adjudicate Plaintiff’s common law public dedication claim.  After the Court of Appeal opinion was issued, counsel for Plaintiff stated the ruling “gave us a road map to how to win at trial.”  However, that remains to be seen in this very public lawsuit.

Glen Hansen is a Senior Counsel at Abbott & Kindermann, LLP.  For questions relating to this article or any other California land use, real estate, environmental and/or planning issues contact Abbott & Kindermann, LLP at (916) 456-9595.

The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, LLP, or 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.

 

By Glen C. Hansen

Almanor Lakeside Villas Owners Assn. v. Carson (2016) 246 Cal.App.4th 761

In an action by a homeowners’ association to enforce $54,000 in dues, fees, fines and interest imposed on property owners under the applicable CC&Rs, the Court of Appeal for the Sixth Appellate District held in Almanor Lakeside Villas Owners Assn. v. Carson (2016) 246 Cal.App.4th 761, 2016 Cal.App LEXIS 301 that (1) the trial court properly issued a judgment that concluded that only $6,620 of the fines were valid against the owners; (2) the trial court did not abuse its discretion in determining that the association achieved its main enforcement objectives and was therefore the prevailing party under the Davis-Stirling Common Interest Development Act (“ Act,” Civ. Code §§4000 et. seq.); and (3) the trial court’s award in favor of the association of its full attorneys’ fees and costs in the amount of $101,803.15 was not unreasonable.

In Almanor, the plaintiff was a homeowners association (“Association”) under the Act for the Almanor Lakeside Villa development (“Development”) on Lake Almanor in Plumas County.  Defendants and cross-complainants James and Kimberly Carson owned a lodge and two chalets (the “Properties”) within the Development.  The Properties are among only a few lots in Development that accommodate commercial use, partially due to the preexisting use of the lodge. The Properties were subject to the CC&Rs of the Development.  Among other things, section 4.09 of the CC&Rs prohibited owners from using their lots “for transient or hotel purposes” or renting for “any period less than 30 days.” From 2010 through 2012 the Association’s Board developed rules to enforce the CC&Rs, including enforcement of the section 4.09 restriction on short-term rentals if a copy of any rental agreement is provided to the Association seven days before the rental period.  Other rules were adopted that affected the Properties, such as parking, trash storage, use of common areas, and issuing decals for any boats using the Association’s boat slips. The Carsons did not believe that such rules applied to their Properties because of section 4.01 of the CC&Rs and the long-established commercial status of the Properties.  The Association sought to impose fines and related fees of $19,979.97 on the Carsons for alleged rule violations related to the Carsons’ leasing of their properties in the development as short-term vacation rentals. The Carsons viewed the rules as unlawful and unfair use restrictions on their commercially zoned properties. Also, the Carsons argued that the Association improperly applied $1,160 of the Carson’s payment for dues toward the fines imposed by the Association.

The Association sued to enforce its rules and recover the fines it imposed, estimating that the total owed by the Carsons was $54,000.  The Carsons cross-complained for breach of contract, private nuisance, and intentional interference with prospective economic advantage. The trial court found that the 30-day minimum rental restriction imposed by section 4.09 of the CC&Rs presented an “obvious conflict” with section 4.01, which “expressly allow[ed] the Carsons to use their lots for commercial purposes (presumably including lodging, since the properties are, in fact, lodges).” The trial court concluded only $6,620 in fines pertaining to the nonuse of the Association’s boat decals were reasonable.  The trial court also concluded that, even assuming the Association had breached the CC&Rs, the Carsons had not proven any damages and so they received nothing on their cross-complaint.  On the parties’ competing motions for attorneys’ fees, the trial court determined the Association to be the prevailing party and awarded the Association its full $101,803.15 in attorneys’ fees and costs.  The Carsons appealed. The Court of Appeal affirmed the judgment.

On appeal, the Court addressed three issues.  First, the Carsons challenged the trial court’s determination that they failed to prove damages for their breach of contract cause of action in their cross-complaint. The Court held that, while the trial court’s statement of decision did not specifically reference the Carson’s $1,160 damages claim asserted on appeal, the trial court’s finding that the Carsons failed to establish damages by competent evidence was sound.

Second, the Court addressed the Carsons’ argument that the trial court abused its discretion when it found that the Association was the prevailing party despite having disallowed a majority of the fines the Association sought to have imposed.  The Court explained that Civil Code section 5975 of the Act provides that, in an action to enforce CC&Rs “the prevailing party shall be awarded reasonable attorney’s fees and costs.” Thus, “‘“the trial court is therefore obligated to award attorney fees whenever the statutory conditions have been satisfied.”’” The test for prevailing party “is a pragmatic one, namely whether a party prevailed on a practical level by achieving its main litigation objectives.” That test involves a comparison of “the relief awarded on the contract claim or claims with the parties’ demands on those same claims and their litigation objectives as disclosed by the pleadings, trial briefs, opening statements, and similar sources.” Thus, the court must compare “‘the extent to which each party ha[s] succeeded and failed to succeed in its contentions’” and “the practical effect of the relief attained by each.”

Here, the trial court did not abuse its discretion in determining that the Association was the prevailing party.  Of the 88 fines that the Association sought to enforce at trial, the trial court upheld only eight. The Carsons’ success at trial substantially lowered their liability for damages and supported their position that the CC&Rs and associated rules could not impose an unreasonable burden on the properties.  However, by upholding a subset of the fines, the trial court “ruled more broadly” that the Association could impose reasonable use restrictions on the Carsons’ properties. That ruling “echoed [the Association’s] stated objective at trial that the Association sought to counter the Carsons’ position that ‘because their lot is zoned “Commercial,” they are not bound by the rules.  “The fractional damages award does not negate the broader, practical effect of the court’s ruling, which on the one hand narrowed the universe of restrictions that [the Association] could impose on the properties, but on the other hand cemented [the Association’s] authority to promulgate and enforce rules pursuant to the CC&Rs so long as they are not unreasonable.” The court also ruled entirely in favor of the Association on the Carsons’ cross-complaint by finding that the Carsons’ alleged damages were unsupported by competent evidence and too speculative. Thus, the trial court did not abuse its discretion in determining the Association to be the prevailing party.

The Carsons made the public policy argument that, by granting attorneys’ fees to the Association, “the Court is stating that the Carsons should have paid the $54,000.00 that Respondent claimed was owed … , even though only $6,620.00 was actually owed, because they would be penalized for defending themselves and, in the end, owe an additional $101,803.15 in attorney’s fees for defending themselves.” The Court rejected that argument because the Act mandates the award of attorneys’ fees to the prevailing party, and so the trial court had no discretion to deny attorney’s fees once it determined who was the prevailing party.

Third, the Court addressed the Carsons’ argument that the amount of the attorneys’ fees that the trial court awarded was unreasonable (“grossly disproportionate”) in light of the Association’s limited success at trial.   That is an issue committed to the discretion of the trial court. The Carsons argued that Code of Civil Procedure section 1033, subdivision (a), provides that the court has the discretion to disallow attorney’s fees if a party obtains less than the statutory minimum to be classified as an unlimited civil matter.  But the Court rejected that argument because the discretionary provisions of section 1033, subdivision (a), are irreconcilable with the mandatory fees award under section 5975 of the Act.  The Court recognized that “degree of success” may be considered in determining reasonable attorney’s fees under Civil Code section 5975 of the Act, and to the extent a trial court is concerned that a particular award is excessive, “‘it has broad discretion to adjust the fee downward.’” In this case, however, the record did not show that trial court committed a manifest abuse of discretion by awarding the full attorney’s fees sought.  Also, the Carsons did not request a statement of decision with regard to the fee award, and so all intendments and presumptions are indulged to support the judgment. Furthermore, the trial court’s decision is supported by the fact that the minor subset of the fines that formed the basis for the Association’s monetary award requested was sufficient to satisfy the statutory criteria of an action to enforce the governing documents. “In practical effect, [the Association’s] limited success established a baseline from which it can continue to adopt and enforce reasonable use restrictions under the CC&Rs.” Thus, the Court did not find that the award of attorney’s fees, compared to the overall relief obtained by the Association was so disproportionate as to constitute an abuse of discretion.

Glen Hansen is a Senior Counsel at Abbott & Kindermann, LLP.  For questions relating to this article or any other California land use, real estate, environmental and/or planning issues contact Abbott & Kindermann, LLP at (916) 456-9595.

The information presented in this article should not be construed to be formal legal advice by Abbott & Kindermann, LLP, or 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.

 

Reserve your seat for one of four seminars taking place in early 2016.

In January and February 2016 Abbott & Kindermann, LLP will present its 15th annual educational program for clients and colleagues interested in current land use, environmental, and real estate issues affecting commercial and residential development, agriculture, real estate transactions, easements, mining and the construction materials production industry.  

A summary of 2015 case law and legislative updates includes the following hot topics for 2016:

  • Air Quality and Climate Change: including CEQA Guidelines and Mandatory Reporting
  • Mining
  • Updating Land Use Entitlements
  • Endangered Species
  • Water Quality and Wetlands
  • Water Rights and Supply
  • Cultural Resources
  • Renewable Energy
  • Environmental Enforcement
  • Hazardous Substance Control and Cleanup
  • Timber Resources
  • CEQA:  Exemptions, Baseline, Greenhouse Gases and Climate Change
  • CEQA Litigation
  • Real Estate Acquisition and Development

Abbott & Kindermann, LLP will present its annual program at four locations: Redding, Modesto, Sacramento and Napa.  Details for the seminars are below.  We hope you can join us and we look forward to seeing you there.

Modesto Conference  (To Register for the Modesto Location Click Here)

  • Date: Friday, January 22, 2016
  • Location: Double Tree Hotel Modesto, 1150 Ninth Street
  • Registration: 12:30 p.m. – 1:00 p.m.
  • Program: 1:00 p.m. – 4:00 p.m.

Sacramento Conference  (To Register for the Sacramento Location Click Here)

  • Date: Friday, February 5, 2016
  • Location: Sacramento Hilton Arden West, 2200 Harvard Street
  • Registration: 8:30 a.m. – 9:00 a.m. with continental breakfast
  • Program: 9:00 a.m. – 12:00 noon

Redding Conference  (To Register for the Redding Location Click Here)

  • Date: Tuesday, February 9, 2016
  • Location: Hilton Garden Inn Redding, 5050 Bechelli Lane
  • Registration: 12:30 p.m. – 1:00 p.m.
  • Program: 1:00 p.m. – 4:00 p.m.

Napa Conference  (To Register for the Napa Location Click Here)

  • Date: Thursday, February 11, 2016
  • Location: Embassy Suites, 1075 California Boulevard
  • Registration: 12:30 p.m. – 1:00 p.m.
  • Program: 1:00 p.m. – 4:00 p.m.

The registration fee for the program is $80.00. Please register early to reserve your seat. Select the links above to see registration details for each location, as they differ. MCLE and AICP CM credits are available (approval pending).

Please call (916) 456-9595 with any questions.