Volume 5, Number 1

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  December 2009 


Special Message

The Crocker Symposium 2010, Negotiating the Real Estate Maze: Challenges and Opportunities, will bring together Southern California’s top leaders in real estate, including developers, investors, bankers, attorneys, accountants, brokers, academics, government representatives, and property owners. Participants will enjoy an extraordinary day of networking, thought leadership, discussion, and analysis. You will gain the essential tools required to turn obstacles into opportunities in today’s real estate maze.

The real estate industry enjoyed unprecedented growth over the past decade until the market plummeted in value in the fall of 2008. While this market downturn was initially thought to be temporary, it is now entirely unclear when the market will turn and what will precipitate that turn. Those developers, investors, and advisors who come to the Crocker Symposium will be armed with the knowledge and professional network to negotiate the industry’s convoluted maze of complex market conditions—efficiently and cost effectively. They will inevitably surpass those who choose to take on the maze unarmed.

The section's Executive Committee members are actively working on the educational programming for the symposium. This is the opportunity for your firm to get in at the beginning and help plan the programs by becoming a sponsor. Contact Brant Dveirin at bdveirin@bbklaw.com for more information.

So, mark your calendars for March 23, 2010, and plan to attend the Benjamin S. Crocker Symposium on Real Estate Law and Business 2010, at the Los Angeles Convention Center.



Bankruptcy Rule Changes:
Effective December 1, 2009, the time periods for many purposes under the Bankruptcy Act have been extended from 10 to 14 days, including the appeal periods from an order to sell free and clear under Section 363 and from an order granting relief from the automatic stay.

We wish you a Happy Holiday and a prosperous New Year!

Sincerely,

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

Real Property Scheduled Events 
View All Real Property Events

January 6, 2010: ABCs of SNDAs (12:30 PM).

January 20, 2010: We Have Them But Can We Enforce Them? The Enforcement of Guaranties and Other Surety Obligations (12:30 PM).

January 26, 2010: Basics in Blue Print Reading and How it Can Affect Construction Disputes (12:30 PM).

January 28, 2010: Single Purpose Entities: How Remote Is Bankruptcy Remote? (12:30 PM).

February 3, 2010: Top 10 Changes when Negotiating AIA Forms of Construction Contracts and Architect Agreements (12:30 PM).

February 10, 2010: Acret Award & Annual Construction Law Update (12:30 PM).

February 16, 2010: Title 101 (12:30 PM).

February 17, 2010: 2009 Real Estate Finance Update (12:30 PM).

February 25, 2010: Psychology of Dispute Resolution – Practical Tools for Achieving Compromise (12:30 PM).

Recent Cases
Cases from November 1 through November 31

CEQA
Construction Law
Easements
Environmental Law
Federal Quiet Title Actions
Fraudulent Transfer
Guaranties
Indian Law
Land Use


Land Use
Mobile Homes
Mobile Homes
Partnerships
Resulting Trusts
Title Insurance
Trust Deed Foreclosure
Trust Deed Foreclosure
Trusts 

CEQA
Nothing in Density Bonus Law suggests that a municipality must enact an ordinance any time it wishes to provide more density bonus than is required by state law. When an applicant seeks a density bonus for a housing development that includes required percentage of affordable housing, Government Code Sec. 65915 requires that city not only grant the density bonus but provide additional incentives or concessions where needed based on percentage of low-income housing units. Plaintiff failed to demonstrate any change in policy or that city’s action in interpreting and complying with Sec. 65915 was a project subject to requirements of California Environmental Quality Act.
      Wollmer v. City of Berkeley (1950 MLK, LLC) - filed October 30, 2009, publication ordered November 24, 2009, First District, Div. Five
      Cite as 2009 SOS 6780
      Full text                                                                                                                                Back to Top

Construction Law
Exceptions to general licensing law for contractors, regardless of their effect on public water storage district for work that was subject to the law, did not provide an exception to Water Code Sec. 13750.5’s unequivocal mandate that well drillers obtain a contractor’s license.
     California Groundwater Association v. Semitropic Water Storage District - filed November 9, 2009, Fifth District
    Cite as 2009 SOS 6400
    Full text                                                                                                                               Back to Top

Easements
A suit that actually challenges the federal government’s title to real property, however denominated and regardless of the remedy sought, falls within the scope of the Quiet Title Act (“QTA”) which waives the federal government’s sovereign immunity exception with respect to lands held in trust or to restricted Indian lands. But a suit that instead concerns the use of land as to which title is not disputed can sound in tort or contract and not come within the scope of the QTA. Where plaintiffs sued the federal government over alleged damages to their easement caused by Indian tribe, and government did not dispute plaintiff’s easement but maintained that Indians’ use of the land had not interfered with it, district court erred in dismissing action for lack of subject matter jurisdiction due to the federal government’s sovereignty under the QTA because the litigation would not result in any adjudication of title to the easement claimed, and plaintiffs’ claims sounded only in tort.
     Robinson v. United States - filed November 2, 2009
      Cite as 07-17052
     Full text                                                                                                                               Back to Top

Environmental Law
Where plaintiffs challenged land exchange between Bureau of Land Management and company that sought to build landfill on former mining site, alleging violations of the Federal Land and Policy Management Act and National Environmental Policy Act, district court erred in limiting its review to agency’s record of decision where Interior Board of Land Appeals granted a stay, and decision never became effective. District court did not err in determining that land appraisal was inadequate because plaintiffs exhausted their argument that BLM failed to consider a landfill as the "highest and best use" of the public parcels before the appeals board, and because appraisal should have taken into consideration the reasonably probable use of public lands for a landfill. District court erred in determining that BLM failed to give "full consideration" to whether the land exchange well-served the public interest where the record established that BLM’s interpretation of the phrase was permissible. District court properly granted summary judgment on claims that environmental impact statement was deficient with respect to "purpose and need" and "reasonable range of alternatives" because BLM adopted company’s interests as its own to craft a purpose and need statement so narrowly drawn as to foreordain approval, necessarily considering as a result an unreasonably narrow range of alternatives. District court erred in granting summary judgment on claims that statement was deficient as to impacts on Bighorn sheep where it contained such information. District court properly granted summary judgment on claims that statement was deficient with respect to eutrophication (introduction of nutrients into the desert environment) where statement’s discussion was neither full nor fair. District court properly determined that plaintiffs lacked standing to pursue claim against the National Park Service under NEPA, the National Park Service Organic Act, and the California Desert Protection Act for reversing its prior rejection of the project because a favorable decision would not redress the injury complained of where the Park Service was not the lead agency responsible for approval. District court properly granted summary judgment to company and BLM on NEPA claims concerning environmental impact statement’s sufficiency regarding desert tortoises, visual, noise, and night lighting impacts, groundwater, and air quality where statement’s discussion of issues was sufficient to foster informed decision-making and public participation.
     National Parks & Conservation Association v. Bureau of Land Management - filed November 10, 2009
     Cite as 05-56814
     Full text                                                                                                                               Back to Top

Federal Quiet Title Action
A suit that actually challenges the federal government’s title to real property, however denominated and regardless of the remedy sought, falls within the scope of the Quiet Title Act (“QTA”) which waives the federal government’s sovereign immunity exception with respect to lands held in trust or to restricted Indian lands. But a suit that instead concerns the use of land as to which title is not disputed can sound in tort or contract and not come within the scope of the QTA. Where plaintiffs sued the federal government over alleged damages to their easement caused by Indian tribe, and government did not dispute plaintiff’s easement but maintained that Indians’ use of the land had not interfered with it, district court erred in dismissing action for lack of subject matter jurisdiction due to the federal government’s sovereignty under the QTA because the litigation would not result in any adjudication of title to the easement claimed, and plaintiffs’ claims sounded only in tort.
    Robinson v. United States - filed November 2, 2009
    Cite as 07-17052
    Full text                                                                                                                              Back to Top

Fraudulent Transfer
Where defendant deeded his interest in a home that he co-owned with co-defendant over to co-defendant on learning that plaintiff title insurance company was about to file an abstract of judgment as a lien against his real property, trial court did not err in declining to set transfer aside under the Uniform Fraudulent Transfer Act on the basis that no recoverable value remained in the real property after deducting existing encumbrances and defendant’s homestead exemption. Trial court erred in concluding that title insurance company could not maintain a resulting trust cause of action, and remand was required to determine whether co-defendant held defendant’s one-half interest in the property as a resulting trust for the benefit of defendant, in which case company’s judgment lien would attach to defendant’s equitable interest effective on the date company recorded its abstract of judgment.
    Fidelity National Title Insurance Company v. Schroeder - filed November 24, 2009, Fifth District
    Cite as 2009 SOS 6789
    Full text                                                                                                                               Back to Top

Guaranties
Where defendant provided unsecured personal guaranties as additional credit support for construction loans secured by real property made by bank to borrower, prohibition in Code of Civil Procedure Sec. 483.010 against issuance of an attachment order for a claim secured by real property did not apply to bank’s motion to attach property of defendant. Trial court committed plain error by failing to recognize that bank’s claim was based on unsecured guaranties.
    United Central Bank v. Superior Court (Chang) - filed October 19, 2009, publication ordered November 16, 2009, Fourth District, Div. Three
    Cite as 2009 SOS 6527

    Full text                                                                                                                               Back to Top

Indian Law
A suit that actually challenges the federal government’s title to real property, however denominated and regardless of the remedy sought, falls within the scope of the Quiet Title Act (“QTA”) which waives the federal government’s sovereign immunity exception with respect to lands held in trust or to restricted Indian lands. But a suit that instead concerns the use of land as to which title is not disputed can sound in tort or contract and not come within the scope of the QTA. Where plaintiffs sued the federal government over alleged damages to their easement caused by Indian tribe, and government did not dispute plaintiff’s easement but maintained that Indians’ use of the land had not interfered with it, district court erred in dismissing action for lack of subject matter jurisdiction due to the federal government’s sovereignty under the QTA because the litigation would not result in any adjudication of title to the easement claimed, and plaintiffs’ claims sounded only in tort.
    Robinson v. United States - filed November 2, 2009
    Cite as 07-17052
    Full text                                                                                                                              Back to Top

Land Use
Nothing in Density Bonus Law suggests that a municipality must enact an ordinance any time it wishes to provide more density bonus than is required by state law. When an applicant seeks a density bonus for a housing development that includes required percentage of affordable housing, Government Code Sec. 65915 requires that city not only grant the density bonus but provide additional incentives or concessions where needed based on percentage of low-income housing units. Plaintiff failed to demonstrate any change in policy or that city’s action in interpreting and complying with Sec. 65915 was a project subject to requirements of California Environmental Quality Act.
    Wollmer v. City of Berkeley (1950 MLK, LLC) - filed October 30, 2009, publication ordered November 24, 2009, First District, Div. Five
    Cite as 2009 SOS 6780
    Full text                                                                                                                              Back to Top

Land Use
As used in Government Code Sec. 65858(c), phrases "development of projects with a significant component of multifamily housing" and "development of multifamily housing projects" are synonymous. Sec. 65858(g), which expressly limits meaning of "development of multifamily housing projects," therefore limits meaning of "development of projects with a significant component of multifamily housing" as well. "Development of projects with a significant component of multifamily housing" does not include the development of the types of projects described in subdivision (g); if an interim ordinance has effect of denying approvals needed for development of only those types of projects described in subdivision (g), additional findings set forth in paragraphs (1) through (3) of subdivision (c) are not required. City was required to make findings set forth in paragraphs (1) through (3) of Sec. 65858(c) if interim ordinance had effect of denying approvals needed for development of projects with a significant component of multifamily housing, regardless of whether interim ordinance also had effect of denying approvals for types of developments described in subdivision (g), and regardless of whether plaintiffs’ proposed projects were the types of developments described in subdivision (g). Whether statutory findings are required depends not on effect of an interim ordinance on a particular applicant challenging an extension but on effect of interim ordinance generally. "[T]he effect of denying approvals" in Sec. 65858(c) refers to the denial of applications for development approvals. To satisfy requirements of Sec. 65858(c), a written finding by the legislative body must identify a specific, significant, quantifiable, direct, and unavoidable impact on the public health or safety that would result from continued development approvals, and objective, written public health or safety standards, policies, or conditions on which that impact is based.
    Hoffman Street, LLC v. City of West Hollywood - filed November 23, 2009, Second District, Div. Three
    Cite as B210789
    Full text                                                                                                                               Back to Top

Mobile Homes
Where heirs who gained ownership of a mobile home in a mobile home park through death of tenant mobile-home owner made repairs correcting code violations on that mobile home, such action did not estop mobile home park owner from seeking an ejectment order; heirs had no right to maintain a park nuisance. Service of a 60-day notice of termination did not waive park owner's right to remove heirs' mobile home. Trial court did not err in excluding evidence of settlement letter stating that park owner would consent to sale of mobile home contingent upon heirs making necessary repairs.
    Simandle v. Vista de Santa Barbara Associates, LP - filed November 4, 2009, Second District, Div. Six
    Cite as 2009 SOS 6342
    Full text                                                                                                                                 Back to Top

Mobile Homes
Where plaintiff inherited his mother's mobile home, he was her heir with respect to her rental space, pursuant to her rental agreement with defendant mobile home park, and his proffered replacement mobile home was required to meet current standards of the park as contained in the park's most recent written requirements issued to prospective homeowners, as provided in Civil Code Sec. 798.78. Procedural requirements for enactment of mobile home park rules and regulations under Sec. 798.25 have no application to the standards and requirements with which heirs must comply under Sec. 798.78. Nothing in state law regarding minimum setbacks for mobile homes prohibits park operators from requiring greater setbacks or more stringent siting requirements.
    Hoffman v. Smithwoods RV Park, LLC - filed October 23, 2009, publication ordered November 19, 2009, Sixth District
    Cite as 2009 SOS 6647
    Full text                                                                                                                                Back to Top

Partnerships
Where two individuals entered into a real estate partnership acting in their capacity as trustee of a family trust, the partners were the individuals, not the trusts. A trust is a relationship by which one person or entity holds property for the benefit of another and is not a separate entity from its trustees; trustees act as individuals when carrying out trust business.
    Presta v. Tepper - filed October 28, 2009, publication ordered November 24, 2009, Fourth District, Div. Three
    Cite as 2009 SOS 6795
    Full text                                                                                                                                Back to Top

Resulting Trust
Where defendant deeded his interest in a home that he co-owned with co-defendant over to co-defendant on learning that plaintiff title insurance company was about to file an abstract of judgment as a lien against his real property, trial court did not err in declining to set transfer aside under the Uniform Fraudulent Transfer Act on the basis that no recoverable value remained in the real property after deducting existing encumbrances and defendant’s homestead exemption. Trial court erred in concluding that title insurance company could not maintain a resulting trust cause of action, and remand was required to determine whether co-defendant held defendant’s one-half interest in the property as a resulting trust for the benefit of defendant, in which case company’s judgment lien would attach to defendant’s equitable interest effective on the date company recorded its abstract of judgment.
    Fidelity National Title Insurance Company v. Schroeder - filed November 24, 2009, Fifth District
    Cite as 2009 SOS 6789
    Full text                                                                                                                                Back to Top

Title Insurance
Where defendant deeded his interest in a home that he co-owned with co-defendant over to co-defendant on learning that plaintiff title insurance company was about to file an abstract of judgment as a lien against his real property, trial court did not err in declining to set transfer aside under the Uniform Fraudulent Transfer Act on the basis that no recoverable value remained in the real property after deducting existing encumbrances and defendant’s homestead exemption. Trial court erred in concluding that title insurance company could not maintain a resulting trust cause of action, and remand was required to determine whether co-defendant held defendant’s one-half interest in the property as a resulting trust for the benefit of defendant, in which case company’s judgment lien would attach to defendant’s equitable interest effective on the date company recorded its abstract of judgment.
    Fidelity National Title Insurance Company v. Schroeder - filed November 24, 2009, Fifth District
    Cite as 2009 SOS 6789
    Full text                                                                                                                                Back to Top

Trust Deed Foreclosure
Where auctioneer mistakenly called out legal description and credit bid applicable to incorrect real property at a non-judicial foreclosure sale, therefore opening bidding at a fraction of proper amount, and this mistake was discovered after bidding closed but before a trustee’s deed was issued, auctioneer’s error constituted an "irregularity" sufficient to void the sale.
    Millennium Rock Mortgage, Inc. v. T. D. Service Company - filed November 24, 2009, Third District
    Cite as C059875
    Full text                                                                                                                                Back to Top

Trust Deed Foreclosure
Where defendant provided unsecured personal guaranties as additional credit support for construction loans secured by real property made by bank to borrower, prohibition in Code of Civil Procedure Sec. 483.010 against issuance of an attachment order for a claim secured by real property did not apply to bank’s motion to attach property of defendant. Trial court committed plain error by failing to recognize that bank’s claim was based on unsecured guaranties.
    United Central Bank v. Superior Court (Chang) - filed October 19, 2009, publication ordered November 16, 2009, Fourth District, Div. Three
    Cite as 2009 SOS 6527
    Full text                                                                                                                                Back to Top

Trusts
Where two individuals entered into a real estate partnership acting in their capacity as trustee of a family trust, the partners were the individuals, not the trusts. A trust is a relationship by which one person or entity holds property for the benefit of another and is not a separate entity from its trustees; trustees act as individuals when carrying out trust business.
    Presta v. Tepper - filed October 28, 2009, publication ordered November 24, 2009, Fourth District, Div. Three
    Cite as 2009 SOS 6795
    Full text                                                                                                                                Back to Top

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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
Michael S. Klein

First Vice-Chair
Pamela L. Westhoff

Second Vice-Chair
Gregg J. Loubier

Treasurer
Theresa C. Tate

Secretary
Sarah V. J. Spyksma

Immediate Past-Chair
Donald C. Nanney


Section Administrator
Terrina Scott

EXECUTIVE COMMITTEE MEMBERS

Eric Altoon
Nedra E. Austin
Babak B. Baradaran
Susan J. Booth
James L. Brat
Norman A. Chernin
Brant Dveirin
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


SUB-SECTION CHAIRS
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.