Volume 4, Number 5

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  April 2009  

 


Special Message

        
Dear Members,

For your convenience, last month we added a summary of some of the new laws affecting the real estate industry.

Thanks to Tina Esrailian at Garrett & Tully for her efforts, we now provide a sequel, a new legislation summary for this April issue: A User’s Guide to 2007-2008 California Statutes Relating to Title Insurance Part II.

Certainly one of the most important events in Southern California for real property attorneys and professionals, the          Benjamin S. Crocker Symposium on Real Estate Law and Business is open for registration. 
     
You can register today for the event on Tuesday, May 5, 2009, at the Los Angeles Convention Center. 
Please visit the symposium Web site (
www.crockersymposium.com).

We encourage everyone to attend.


The State Bar Real Property Law Section Annual Retreat:
“Real Estate in Turbulent Times,” will be held May 15-17, 2009,
at the Resort at Squaw Creek, Lake Tahoe. For additional information please visit:
www.calbar.org/rpsection

Real Property Section Installation Dinner
June 10, 2009

Register now.

Please save the date on your calendar for your Real Property section installation dinner Installation and Awards Dinner will take place on Wednesday, June 10, 2009, at the Riviera Country Club.  This year's honorees will be:

Real Estate Industry Outstanding Achievement Award Recipient
Thomas L. Safran, Thomas Safran and Associates

Outstanding Real Estate Lawyer Award Recipient
Dennis B. Arnold, Esq., Gibson, Dunn and Crutcher

Ira E. Yellin Lifetime Achievement Award Posthumously Presented to
George Smith, George Smith Partners

Outstanding Young Lawyer Award Recipients
Joe Vargas, Buchalter Nemer
Shireen Enayati,  McKenna Long
Henry Herrman, Gilchrist & Rutter

Register now.

 

Sincerely,

Norm Chernin, co-editor, Real Property Newsletter


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Recent Cases

Cases from March 1 through March 31

- CEQA-
-Construction Law-
-Construction Law-
-Easements-
-Environmental Law-
-Homeowners Association-
-Inverse Condemnation-
-Judicial Foreclosure-
-Land Use-
-Landlord and Tenant-
-Real Estate Brokers-
-Specific Performance-
-Water Law-

-CEQA-
Alleged failure of draft EIR to describe where off-site mitigation might occur and to analyze or disclose the impacts of that mitigation did not constitute an unlawful deferral of mitigation where document expressly identified potential impact and specific measure to mitigate that impact; agency was entitled to rely on the results of a future study to fix the exact details of the implementation of the mitigation measures it identified in the EIR. Evidence that other agencies disagreed with city’s determination of the adequacy of mitigation measures was insufficient to carry objecting party’s burden of showing that city’s approval of project was unsupported by substantial evidence. City’s incorporation of certain analyses from another EIR into EIR for project did not, for purposes of exhaustion doctrine, incorporate objections to that project as objections to the pending project. Where project was within a planned community, and plan for that community included certain mitigation measures that were amended at the same time EIR for the project was adopted, city’s failure to carry out the mitigation measures as established prior to amendment did not violate CEQA. For purposes of the Planning and Zoning Law, city’s consultation with state and federal agencies regarding mitigation measures was insufficient to satisfy general plan requirement that it "coordinate" with such agencies; coordination requirement implied that at least some level of actual cooperation between the agencies would occur.
     California Native Plant Society v. City of Rancho Cordova (Jaeger Road 530, LLC) - filed March 24, 2009, Third District
     Cite as 2009 SOS 1792
     Full text

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-Construction Law-
An entity that provides construction management services to a private owner developing commercial real property is not required to be licensed pursuant to the Contractors' State License Law.
     The Fifth Day, LLC v. Bolotin - filed March 27, 2009, Second District, Div. Five
     Cite as 2009 SOS 1918
     Full text

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-Construction Law-
Where licensed general contractor and responsible managing employee disassociated himself from partnership with defendants before defendants entered into a contract with plaintiff to perform home repairs and began work, defendants were not acting in substantial compliance with licensing requirements because defendants were never licensed prior to time contract was entered into and work commenced.
     Oceguera v. Cohen - filed March 24, 2009, Second District, Div. Five
     Cite as 2009 SOS 1834
    
Full text

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-Easements-
Utility’s immunity from liability to plaintiff injured by contact with power line for which utility had an easement, pursuant to Civil Code Sec. 846--which provides with certain exceptions that a property owner "owes no duty of care to keep the premises safe for entry or use by others for any recreational purpose"--precludes property owner, potentially liable to plaintiff under one of the statutory exceptions, from recovering on cross-complaint alleging utility’s liability for implied contractual indemnity based on its breach of a contractual duty owed to property owner to maintain its power line easement in repair.
     Prince v. Pacific Gas & Electric Company - filed March 19, 2009
     Cite as 2009 SOS 1666
    
Full text

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-Environmental Law-
Where plaintiffs served statutorily required notices on developers alleging they had violated Sec. 404 of Clean Water Act by activities beginning on a certain date, but notices neither mentioned any other claims under Act nor specified what "wetlands" were affected or how, and developers ceased allegedly wrongful activities and acted to effect repairs for any problems past activities had caused, notice was insufficient and district court lacked jurisdiction to hear plaintiffs' claim. Plaintiffs' claim that development project disrupted normal behavior patterns of bald eagles, in violation of Endangered Species Act, was rendered moot by bald eagles' removal from endangered species list.
     Center for Biological Diversity v. Marina Point Development Co. - filed August 6, 2008, amended March 27, 2009
     Cite as 0656193
    
Full text

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-Homeowners Association-
Homeowner who alleged that he could not work outside home due to disability and that homeowner’s association was preventing him from working at home in violation of the Fair Employment and Housing Act, the Unruh Civil Rights Act, and Civil Code Sec. 53--the ban on restrictive covenants--was not entitled to injunctive relief where plaintiff admitted that he was seeing up to eight people daily for "religious and medical counseling," association rules prohibited conduct of home business without approval of city and association, and plaintiff did not seek such approval.
     Nelson v. Avondale HOA - filed February 27, 2009, publication ordered March 25, 2009, Fourth District, Div. Two
     Cite as 2009 SOS 1845
     Full text

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-Inverse Condemnation-
When a watercourse has been converted into a public work, and flood damage results, rule of strict liability does not always apply. Where there has been an alleged increased discharge of water into a watercourse from public activities or public infrastructure, and where such watercourse is on land historically subject to flooding, the reasonableness rule--which requires a public agency to compensate a property owner only if agency acted unreasonably and property owner had taken reasonable measures to protect his or her property--applies. Five-year statute of limitations applies to inverse condemnation action based on a physical invasion of plaintiff’s property by county drainage pipes and ditch.
      Hauselt v. County of Butte - filed March 23, 2009, Third District
     Cite as 2009 SOS 1823
    
Full text

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-Judicial Foreclosure-
Federal law governs appointment of receiver where jurisdiction is premised on diversity, and district courts have broad discretion to consider a number of factors in considering whether or not to appoint a receiver, with no one factor being dispositive. District court did not abuse its discretion where it appointed receiver to manage mall on basis that mall and associated rents were in danger of substantial waste and risk of loss because income was being diverted and not applied to servicing debt and real estate taxes, and on basis that mall was or might become insufficient to discharge debt it secured; court's order requiring turnover of rents from before receiver was appointed was similarly not abuse of discretion. Insurer who sought receivership was prevailing party, and therefore entitled to attorneys' fees under terms in deed of trust.
     Canada Life Assurance Co. v. LaPeter - filed March 4, 2009
     Cite as 0735683
    
Full text

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-Land Use-
Where developer obtained development agreement and tentative subdivision maps for construction of two residential subdivisions, and city allowed developer to pay fee of $734 per house in lieu of building affordable housing at time documents were approved, but later increased fee to $20,946 per house and sought to apply it to developer’s residential projects, fee increase did not violate developer’s rights under vesting tentative map because city’s approval of map was subject to terms of development agreement. Provision in development agreement by which developer agreed to be bound by city’s updated analysis so long as it was "reasonably justified" did not require city to use specific approach in conducting analysis, but a reasonable person would expect term "reasonably justified" to mean increase would conform to existing law. Increase in fee was not reasonably justified as required by development agreement where city failed to show fee was reasonably related to need for affordable housing associated with project.
     Building Industry Association of Central California v. City of Patterson - filed January 30, 2009, ordered published March 2, 2009, Fifth District
     Cite as F054785
    
Full text

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-Landlord and Tenant-
Where plaintiff’s employer leased apartment, which plaintiff occupied until her employment was terminated and defendant landlord allegedly locked her out on employer’s instructions, plaintiff’s evidence that use and occupancy of the apartment was part of her compensation created triable issue as to whether she was a third-party beneficiary of the lease and thus had right to sue for breach of contract, breach of the implied covenant of good faith and fair dealing, and breach of the implied covenant of quiet enjoyment. Evidence that plaintiff was in peaceful possession of apartment until she was locked out by defendant and that apartment was leased by employer as part of her compensation was sufficient to establish triable issues as to whether defendant was liable for forcible entry, trespass, and invasion of privacy. Property manager’s admitted concerns about effect of changing locks at insistence of plaintiff’s employer without plaintiff’s consent was sufficient to establish triable issue as to whether defendant’s conduct satisfied the outrageousness element of tort of intentional infliction of emotional distress. For purposes of negligence claim and of statutory claims for illegal entry and lock-out, landlord’s duty not to disturb occupant’s peaceful possession without resort to legal process is not dependent on occupant being a "tenant." Evidence that defendant declared its intent to lock plaintiff out of apartment and to remove her furniture was sufficient to establish triable issue as to whether plaintiff was harmed by defendant’s breach of duty even if plaintiff largely removed her belongings from the apartment herself in response to such declaration. Punitive damages are not recoverable for breach of the implied covenant of good faith and fair dealing in the context of a residential lease but may be available for the torts of wrongful eviction, trespass, invasion of privacy, and intentional infliction of emotional distress.
     Spinks v. Equity Residential Briarwood Apartments - filed March 4, 2009, Sixth District
     Cite as H031468
    
Full text

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-Real Estate Brokers-
Open listing agreement for sale of plaintiffs’ woodworking business, together with real property upon which it operated, was a "real property sales transaction" subject to statutory disclosure requirements of Code of Civil Procedure Sec. 1298 because it was a listing agreement between a principal and agent for the sale of real property that was part of a larger transaction for the sale of a business. Trial court did not err in denying broker’s petition to compel arbitration.
     McAvoy v. Hilbert - filed March 24, 2009, Fourth District, Div. One
     Cite as 2009 SOS 1828
     Full text

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-Specific Performance-
Where seller told buyer he did not care how long project took but then refused to extend escrow after buyer had paid 98 percent of purchase price plus $5 million in project costs and had diligently pursued condition precedent to closing sale, seller acted in an objectively unreasonable manner. Where seller was aware of landslide problems and had observed soil failures on his property before purchase agreement was made, and admitted he made no inquiries about insurance costs or availability, seller lacked good cause not to extend escrow because of landslide liability concerns. Where seller was kept informed of progress of buyer’s land use application and never complained to buyer about lacking information about project details, and purchase contract provided that requirement to keep seller informed was a condition for granting an extension, even if buyer breached obligation to keep seller informed, it would not constitute reasonable or good faith grounds for him to refuse the requested extension. Trial court did not abuse its discretion in awarding attorney fees in excess of purchase price where buyers were protecting investment paid to defendant and viability of an entire development project, and seller had aggressively litigated case. Trial court has inherent power to make its judgment effective by supervising details of a specific performance decree.
     Peak-Las Positas Partners v. Bollag - filed March 16, 2009, Second District, Div. Six
     Cite as 2009 SOS 1600
    
Full text

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-Water Law-
Where a watercourse has been converted into a public work, and flood damage results, rule of strict liability does not always apply. Where there has been an alleged increased discharge of water into a watercourse from public activities or public infrastructure, and where such watercourse is on land historically subject to flooding, the reasonableness rule--which requires a public agency to compensate a property owner only if agency acted unreasonably and property owner had taken reasonable measures to protect his or her property--applies. Five-year statute of limitations applies to inverse condemnation action based on a physical invasion of plaintiff’s property by county drainage pipes and ditch.
     Hauselt v. County of Butte  - filed March 23, 2009, Third District
     Cite as 2009 SOS 1823
     Full text

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Los Angeles County Bar Association
2009 Real Property Section Newsletter
REAL PROPERTY SECTION REVIEW
Daniel L. Goodkin, Editor    *   Norman A. Chernin, Co-Editor

SECTION OFFICERS
Chair
Donald C. Nanney

First Vice-Chair
Michael S. Klein

Second Vice-Chair
Pamela L. Westhoff

Treasurer
Gregg J. Loubier

Secretary
Theresa C. Tate

Immediate Past-Chair
Timothy M. Truax

Chair Emeritus
Norma J. Williams,

Section Administrator
Terrina Scott

EXECUTIVE COMMITTEE MEMBERS

Eric Altoon
Nedra E. Austin
Susan J. Booth
James L. Brat
Norman A. Chernin
Brant H. Dveirin
Daniel L. Goodkin
Rebecca H. Lessley

Peter J. Niemiec
D. Eric Remensperger
David C. Sampson
Michael G. Smooke
Linda E. Spiegel
Sarah J. Spyksma
Valerie Wisot
Andrew J. Yamamoto


SUB-SECTION CHAIRS
Commercial Development & Leasing, Marcia Z. Gordon
Construction Law, Brian Ostler
Land Use Planning & Environmental Law, Claire Hervey Collins
Real Estate Finance, Caroline Dreyfus
General Real Estate Law, Nadav Ravid
Title Insurance, David M. Marcus

 

Readers are advised that changes in the law may affect the accuracy of this publication or the functionality of links after the publication date.