Volume 4, Number 10

Join the Real Property Section

Contact Us


  Sept. 2009 

Special Message

        Dear Members,

The section's Executive Committee members have begun to prepare for the Crocker Symposium
to be held next Spring. This is the opportunity for your firm to get in at the beginning and help plan
the programs by becoming a sponsor. Contact Sarah Spyksma at
sspyksma@sidley.com for more information.

In case you missed the informative Real Property CLE event, Real Property Subsection and Publications Fair, on Tuesday, June 30, 2009, you can view the presentations here in video-clip format:

These videos are also available on the Real Property's Section Publications page.


Norm Chernin, co-editor, Real Property Newsletter
E-mail address: nchernin@firstam.com

- Real Property Scheduled Events - View All Real Property Events  Sign Up Now -

   September 16, 2009: Successes and Challenges in Mortgage Loan Workouts. Earn 1 hour of CLE credit.

  September 25, 2009: Top 10 Issues Facing Lenders Who Foreclose on Development Projects. Earn 1 hour of CLE credit.

   September 30, 2009: Real Property Community Outreach Program: Residential Real Estate Transactions. Earn 1.5 hours of CLE credit.

   October 7, 2009: Real Property Community Outreach Program: Structuring Lease Transactions in Troubled Times. Earn 1.5 hours of CLE credit.

Recent Cases

Cases from August 1 through August 31

-Construction Law-
-Construction Defect Litigation-
-Title Insurance-
-Real Property Taxation-
-Real Property Taxation-

Where environmental impact report was considered by city planning commission--which recommended certification--but city council directed EIR be amended by adding information and then certified report without resubmitting it to the planning commission, city did not abuse its discretion, as neither California Environmental Quality Act guidelines nor municipal ordinances required planning commission to make a new recommendation before city council could act. Although final EIR considered by the city council in approving may have been a different draft, it was not a different EIR, and city therefore did not fail to proceed in a manner required by law.
     Tracy First v. City of Tracy (Winco Foods) - filed August 27, 2009, Third District
     Cite as C059227
     Full text 

Back to Top

-Construction Law-
Licensed contractors cited for violations and subject only to sanctions such as correction orders or monetary penalties are not entitled to the same procedural safeguards afforded to contractors who face restriction, suspension, or revocation of their licenses. Preponderance of the evidence standard applied to vocational license disciplinary proceeding where the only potential sanctions were orders of correction and civil penalties. An accusation to initiate hearing need not be filed for citation proceeding that did not seek restriction, suspension, or revocation of contractor’s license. Where contractor was sanctioned for violating two provisions of Business and Professions Code that define misdemeanor crimes and authorize administrative sanctions, contractor was not convicted of criminal misdemeanors through an administrative proceeding.
     Owen v. Sands - filed July 28, 2009, publication ordered August 18, 2009, First District, Div. Five
     Cite as 2009 SOS 5068
     Full text 

Back to Top

-Construction Defect Litigation-
A homeowner who fails to follow statutory procedures before filing construction defect suit bears burden of factually establishing that he has been released from this obligation due to builder’s failure to comply with statutory requirements for builders with respect to documentation and information to be provided to homeowners.
     Standard Pacific Corporation v. Superior Court (Garlow) - filed August 14, 2009, Fourth District, Div. Two
     Cite as 2009 SOS 4962
     Full text 

Back to Top

Judicial review of arbitrator's decision was proper where arbitrator excluded material evidence and therefore substantially prejudiced a party's ability to fairly present its case. Evidence of a lot-line adjustment was material to dispute between buyer and seller over alleged diminution in property value due to an encroachment onto adjacent property.
     Burlage v. Superior Court (Spencer) - filed August 31, 2009, Second District, Div. Six
     Cite as B211431
     Full text

Back to Top

Trial court erred in authorizing receiver to sell an occupied dwelling to collect on a money judgment without complying with Code of Civil Procedure Sec. 704.740, which provides a homestead exemption for the principal residence of a debtor or his spouse. Plain language of law dictates that a judgment creditor must proceed via that statute, making no distinction between sales by sheriffs and receivers.
     Wells Fargo Financial Leasing, Inc. v. D & M Cabinets - filed August 28, 2009, Third District
     Cite as 2009 SOS 5256
     Full text 

Back to Top

County ordinance imposing obligations upon a subdivider submitting a conversion application in excess of those set forth by Government Code Sec. 66427.5 was expressly preempted. Ordinance was also impliedly preempted because legislature had established a dominant role for the state in regulating mobilehomes and had indicated an intent to forestall local intrusion into the particular terrain of mobilehome conversions, declining to expand Sec. 66427.5 in ways that would authorize local government to impose additional conditions or requirements for conversion approval. County’s ordinance also duplicated several features of state law, providing an additional basis for implied preemption.
     Sequoia Park Associates v. County of Sonoma - filed August 21, 2009, First District, Div. Two
     Cite as A120049
     Full text 

Back to Top

-Title Insurance-
Insurer owed no duty under title insurance policy issued to mortgage broker to indemnify or defend corporation which purchased loans from insured because that corporation did not meet definition of "insured" under policy that defined "insured" as "the owner of the indebtedness secured by the insured mortgage and each successor in ownership of the indebtedness."  As used in that policy, word "indebtedness" could not be read in isolation as referring to any indebtedness caused by money changing hands; since "insured mortgage" was defined as referring to a deed of trust from a named borrower to mortgage broker, "indebtedness" reasonably referred to that borrower's debt to lender. A valid underlying indebtedness between named borrower and lender had to exist for owner of that indebtedness to meet the definition of an insured. Where insured forged promissory notes from borrowers to create false loans that were then sold, losses suffered by purchaser of those loans was not due to defect in the title or mortgage lien but due to the lack of a legitimate "indebtedness". Purchaser could not reasonably expect title insurance policy issued to insured to cover losses caused by insured's fraud.
     First American Title Insurance Company v. XWarehouse Lending Corporation - filed August 28, 2009, First District, Div. Three
     Cite as A119931
     Full text 

Back to Top

-Real Property Taxation-
Agreement that had no economic substance other than to avoid property tax liability was a sham document that could not be given effect. For a change in ownership to occur, there must be a transfer of legal title and of that transferor’s beneficial or equitable interests in that property. A party will hold an interest in the beneficial use of real property while another party holds legal title only in fiduciary situations. For purposes of property tax reassessment, a 100% change in ownership occurred when record title in property was transferred from one entity to another as an initial capital contribution to transferee’s parent company. Where transferor was entitled to receive distributions if transferee’s parent company made a profit and had a right to participate in certain management decisions, those benefits and rights derived from transferor’s membership interest in transferee’s parent company, not from transferred property, and thus transferor did not retain a beneficial interest in that property.
     Fashion Valley Mall, LLC v. County of San Diego - filed August 17, 2009, Fourth District, Div.One
     Cite as 2009 SOS 4956
     Full text

Back to Top

-Real Property Taxation-
Where city levied a fee upon owners of residential property who were engaged in the rental of their properties for the primary purpose of recovering the cost of collecting and administering a general tax levied on those same property owners, such fee was itself a general tax because it indirectly raised revenue that was available for expenditure on any government purpose; that tax was void because it was not approved by a majority vote of the municipal electorate.
     Weisblat v. City of San Diego - filed August 18, 2009, Fourth District, Div. One
     Cite as 2009 SOS 5014
     Full text 

Back to Top

Reader Reactions

So - What do you think of the Real Property News?  Please send us your comments and suggestions. This is your newsletter.


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

Michael S. Klein

First Vice-Chair
Pamela L. Westhoff

Second Vice-Chair
Gregg J. Loubier

Theresa C. Tate

Sarah V. J. Spyksma

Immediate Past-Chair
Donald C. Nanney

Section Administrator
Terrina Scott


Eric Altoon
Nedra E. Austin
Babak B. Baradaran
Susan J. Booth
James L. Brat
Norman A. Chernin
Robert T. Flick
Daniel L. Goodkin
Brian Richard Hochleutner
Linda S. Koffman
Rebecca H. Lessley

Peter J. Niemiec
Robert C. Pearman
Leslie D. Reed
D. Eric Remensperger
David C. Sampson
Michael G. Smooke
Linda E. Spiegel
Andrew J. Yamamoto

Commercial Development & Leasing, Marcia Z. Gordon
Construction Law, Richard Mah
Land Use Planning & Environmental Law, Claire Hervey Collins
Real Estate Finance, Caroline Dreyfus
General Real Estate Law, Nadav Ravid
Title Insurance, Gytis L. Nefas


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