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An ePublication of the Los Angeles County Bar Association
Volume 7, Number 1 • January 2012 • Archive of Past Issues
Real Property Home Page

Special Announcement

An interesting compendium of new cases to peak your interest as the New Year starts. Note particularly the Redevelopment Law decision by the California Supreme Court which is becoming the Talk of the Town among a lot of real estate practitioners.

Sincerely,

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

Recent Cases

From December 1 to December 31

CEQA
CEQA
Commercial Finance
Community Property Law
Community Property Law
Construction Law
Construction Law
Escrow Law
Escrow Law
Execution Sales
Inverse Condemnation
Inverse Condemnation

Land Use
Land Use
Landlord and Tenant
Landlord and Tenant
Mechanic's Lien Foreclosure
Quiet Title Actions
Redevelopment Agencies
Subdivision Map Act
Trusts
Trust Deed Foreclosure
Trust Deed Foreclosure
Trust Deed Foreclosure

CEQA
Baseline for a CEQA analysis must reflect current conditions at a project site. Baseline selected by Land Commission was both legally proper and supported by substantial evidence. Administrative agencies not only can but should make appropriate adjustments, including to the baseline, as the environmental review process unfolds. EIR did not need to address alternative urged by plaintiffs since it was directed at an asserted impact not identified in the EIR. There was no violation of the public trust doctrine where commission continued a permissible and long-standing trust use and conducted adequate review under CEQA.
Citizens for East Shore Parks v. California State Lands Commission (Chevron U.S.A.)
filed December 30, 2011, First District, Div. One
Cite as 2012 S.O.S. 1
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CEQA
EIR for large mixed-use development adequately discussed preservation in place as a means to mitigate significant impacts on historical archaeological resources and impacts relating to sea level rise as a result of global climate change, and adequately responded to comments on the latter subject. Objectors' disagreement with the response and questioning of qualifications of the expert relied on by City did not render the responses inadequate.
Ballona Wetlands Land Trust v. City of Los Angeles (Playa Capital Company, LLC)
filed November 2, 2011, publication ordered December 2, 2011, Second District, Div. Three
Cite as 2011 S.O.S. 6511
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Commercial Finance
Party who signed a document titled "Continuing Guaranty"--wherein he unconditionally guaranteed to pay an amount equal to the borrower's debt, affixed his signature over the designation "Guarantor," and filed a declaration under penalty of perjury that he understood he would be responsible to pay the borrower's debt if it was unable to do so--signed a guaranty, not a protected demand note.
Gray1 CPB, LLC v. Kolokotronis
filed December 2, 2011, publication ordered December 28, 2011, Third District
Cite as 2011 S.O.S. 7102
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Community Property Law
No limitations period applies to claims brought pursuant to Family Code Sec. 1101(b), except for laches, when the marriage ends though litigation or death. No creditor's claim was necessary for plaintiff to pursue her community property interest.
Patrick v. Alacer Corporation
filed November 16, 2011, publication ordered December 14, 2011, Fourth District, Div. Three
Cite as 2011 S.O.S. 6772
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Community Property Law
Court was empowered by Family Law Act to preserve community property pending division between spouses and properly exercised that power when, without requiring wife to post a bond, it quashed writ of execution and enjoined further enforcement against community property of a default judgment that husband's creditor had obtained against him after he and wife separated.
Marriage of Guasch
filed December 8, 2011, Sixth District
Cite as 2011 S.O.S. 6624
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Construction Law
A builder who opts out of the non-adversarial statutory pre-litigation procedures set forth in Chapter 4 of the Right to Repair Act in favor of its own contractual procedures opts out of the entirety of Chapter 4, and the disclosure provisions of Civil Code Section 912 do not apply to such a builder. An asserted failure to strictly comply with Section 912 did not bar enforcement of builder's alternative contractual non-adversarial pre-litigation procedures. Inclusion of a contractual damages limitation did not invalidate the entire contract or the entire contractual non-adversarial pre-litigation procedure.
Baeza v. Superior Court (Castle & Cooke California, Inc.)
filed December 14, 2011, Fifth District
Cite as 2011 S.O.S. 6739
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Construction Law
To be a subcontractor rather than a materialman for purposes of recovery under a public works payment bond, one need not actually construct any part of the project, whether on or off site.
Eggers Industries v. Flintco, Inc.
filed December 5, 2011, Third District
Cite as 2011 S.O.S. 6478
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Escrow Law
Bank that held construction retention funds in the form of marketable securities in escrow failed to state a claim for equitable remedy of interpleader where escrow agreement between City and contractor designated contractor as the "beneficial owner" of the securities and unconditionally entitled contractor to distribution of interest generated by the securities, but not the principal, and City was entitled to demand liquidation of the securities and distribution of the funds upon notice of contractor's default. These instructions were clear and did not expose bank to possible double liability if it made disbursements from the escrow account according to these conditions. Mere hypothetical possibility of a municipal bankruptcy is simply too slender a reed upon which to force City into litigation by way of interpleader.
Westamerica Bank v. City of Berkeley
filed December 5, 2011, First District, Div. Four
Cite as 2011 S.O.S. 6505
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Escrow Law
Escrow holder could not be held liable to seller for negligence in preparing a deed of trust--which seller alleged prevented him from foreclosing promptly after buyer defaulted--absent admissible evidence that there was at least one ready, willing, and able buyer who would have purchased the property but for the delay in the foreclosure proceeding resulting from the error in the deed of trust.
Park v. First American Title Company
filed November 23, 2011, publication ordered December 16, 2011, Fourth District, Div. Three
Cite as 2011 S.O.S. 6798
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Execution Sales
Principles of equity and fairness permit the redemption of property purchased by a judgment creditor at an invalid execution sale, though the statutory scheme characterizes execution sales as "absolute." Citizens may not be dispossessed of their property by a "creditor" executing on a judgment that is void ab initio for lack of personal jurisdiction. Deploying a void judgment to seize the property of someone who was never served with the lawsuit violates the constitutional guarantee that no person shall be deprived of property without due process of law.
Lang v. Roche
filed November 29, 2011, Second District, Div. Two
Cite as B222885
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Inverse Condemnation
Plaintiffs did not plead sufficient facts to state a claim for inverse condemnation where plaintiffs alleged City caused plaintiffs' property and business to be appraised; requested plaintiff obtain his own appraisal so that negotiations could commence; and met with individual plaintiff and told him to either sell or City would take his property by eminent domain, as none of these alleged acts were acts of acquisition. Signs announcing a City project involving plaintiff's parcel of land, general statements by City and developer that the project would go forward, and statements in a grant application indicating City's willingness to proceed with the project all constituted general planning and were not acts towards actually acquiring the property. Plaintiffs cannot pursue a cause of action for unreasonable pre-condemnation conduct where they alleged no such conduct.
Joffe v. City of Huntington Park
filed November 9, 2011, publication ordered December 2, 2011, Second District, Div. Three
Cite as 2011 S.O.S. 6493
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Inverse Condemnation
City acted arbitrarily and capriciously in declining to lift imposition of set of land use restrictions limiting parcels to 1 dwelling per 20 acres on an undeveloped 2.85 acre parcel without any unusual topography in the middle of a residential tract otherwise zoned to allow at least 4 dwellings per acre. City's refusal to lift the restrictions imposed specifically on this parcel constituted a partial taking.
Avenida San Juan Partnership v. City of San Clemente
filed December 14, 2011, Fourth District, Div. Three
Cite as 2011 S.O.S. 6779
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Land Use
Church's claim that county enforced a land use regulation in violation of the church's constitutional and statutory rights under 42 U.S.C. Sec. 1983 and the Religious Land Use and Institutionalized Persons Act were not ripe for review where church had failed to apply for the required land use permit both during the 22 years it occupied the property prior to enforcement efforts and after the district court ordered it to do so as a condition of proceeding with its suit. Equitable estoppel did not apply where church had been apprised of the permit requirement multiple times. Church's knowledge of the need for a use permit, multiple efforts to obtain one, and ignorance of the prior existence of any such permit undermine any claim that the church actually relied on an existing valid permit while conducting religious services in the building.
Guatay Christian Fellowship v. County of San Diego
filed December 23, 2011
Cite as 09-56541
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Land Use
Beaches located on property paid for and improved by certain landowners, to which access was limited to those landowners, were not a traditional public forum. Exclusion of plaintiff from these beaches does not violate either his First Amendment or Fourteenth Amendment rights.
Wright v. Incline Village General Improvement District
filed December 27, 2011
Cite as 10-16043
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Landlord and Tenant
A tenant to a commercial lease may agree to limit the scope of the covenant of quiet enjoyment, whether express or implied, as well as the implied covenant of fair dealing. Commercial lease--which stated lessor would not be liable under "any circumstances" for breaches of the lease and negligence for damages or injury arising from "any...cause" on the areas of the shopping center outside the leased premises or for injuries to the lessee's business--exempted lessor from liability for breach of the lease and ordinary negligence under the facts alleged.
Frittelli, Inc. v. 350 North Canon Drive, LP
filed December 20, 2011, Second District, Div. Four
Cite as B228487
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Landlord and Tenant
In calculating damages for breach of a lease, where subsequent tenants paid rent at a higher rate than defendant, trial court properly applied such excess rent as a set-off against rent that was past due at time defendant vacated. Trial court did not abuse discretion in finding that defendant was the prevailing party for purposes of attorney fee award where defendant breached lease but plaintiff failed to win any award of damages. Trial court erred in awarding attorney fees to plaintiff as prevailing party on defendant's cross-complaint for violation of statutes governing disposition of property left on premises by vacating tenant. Because the cause of action did not arise from the lease, Civil Code Section 1717 did not apply.
Kumar v. Yu
filed November 17, 2011, publication ordered December 16, 2011, Second District, Div. Seven
Cite as 2011 S.O.S. 6826
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Mechanic's Lien Foreclosure
Time period for foreclosing on mechanic's lien under Civil Code Section 3144 on property owned by a debtor in bankruptcy was tolled during the pendency of bankruptcy proceedings.
Pioneer Construction, Inc. v. Global Investment Corp.
filed December 21, 2011, Second District, Div. One
Cite as B225685
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Quiet Title Actions
Trial court did not have authority to enter default judgment in quiet title action. Code of Civil Procedure Section 764.010 obligated the court to hold an evidentiary hearing in open court before it adjudicated title.
Harbour Vista, LLC v. HSBC Mortgage Services Inc.
filed December 19, 2011, Fourth District, Div. Three
Cite as 2011 S.O.S. 6869
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Redevelopment Agencies
Once created and engaged in redevelopment plans, redevelopment agencies do not, under the State Constitution, have a protected right to exist that immunizes them from statutory dissolution by the Legislature. Redevelopment agencies and their sponsoring communities have a constitutionally protected right not to make payments to various funds benefiting schools and special districts as a condition of continued operation.
California Redevelopment Association v. Matosantos
filed December 29, 2011
Cite as 2011 S.O.S. 7042
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Subdivsion Map Act
Where City created a Below Market Rate Condominium Conversion Program under authority of the state Subdivision Map Act, and subsequently adopted an ordinance clarifying and revising certain aspects of the program, a facial challenge to the ordinance was subject to the Act's 90-day limitations period. Trial court erred in holding that the 90-day limitation applied only to a limited range of decisions concerning subdivisions.
Aiuto v. City and County of San Francisco
filed December 15, 2011, First District, Div. Four
Cite as 2011 S.O.S. 6755
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Trusts
A judgment in law or arbitration against a trust is unenforceable because a trust is not an entity and cannot hold title to any property. Party that accepted and confirmed an arbitration award against a trust without any attempt to have either the arbitrator or a court correct it to name the trustees as the proper parties was bound by the terms of the arbitration award.
Portico Management Group, LLP v. Harrison
filed December 28, 2011, Third District
Cite as 2011 S.O.S. 7071
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Trust Deed Foreclosure
Civil Code Section 2923.5, prohibiting a residential lender from foreclosing without first contacting the borrowers to explore alternatives to a forced sale of the property, does not provide relief after a sale takes place. A party seeking to set aside a foreclosure sale must, under equitable principles, make a full tender of arrearages. A mere offer to tender will not satisfy the requirement.

Allegations that defendants--mortgage lenders and servicers--stopped considering alternatives to foreclosure and abruptly foreclosed without informing plaintiffs or their counsel of any decision regarding loan modification or other alternative--and that they did so with knowledge that one of the plaintiffs was a dependent adult--were insufficient to plead a statutory claim for abuse of a dependent adult in the absence of facts showing that defendants made a "wrongful use" of the property..
Stebley v. Litton Loan Servicing, LLP
filed November 30, 2011, publication ordered December 29, 2011, Third District
Cite as 2011 S.O.S. 7099
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Trust Deed Foreclosure
Trial court--which properly enjoined lender from proceeding with non-judicial foreclosure where it failed to contact borrowers to explore alternatives prior to doing so, as required by statute--erred in requiring borrowers to post bond and abused its discretion in dissolving injunction when they failed to do so.
Bardasian v. Superior Court (Santa Clara Partner's Mortgage Corporation)
filed December 15, 2011, Third District
Cite as 2011 S.O.S. 6789
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Trust Deed Foreclosure
Irregularity in the notice and sale procedures is not the only ground for setting aside a trustee's sale. Defendants failed to meet their burden on summary judgment because they failed to address all of the allegations by homeowner that the home loan was unconscionable. Evidence that homeowner had only an eighth grade education, his English was limited, no one explained the documents to him, and he did not understand what he was signing was sufficient evidence of unequal bargaining power, oppression, or surprise to raise a triable issue regarding procedural unconscionability. Extreme disparity between the amount of the monthly loan payments and homeowner's income was sufficient to create a triable issue on the question of whether the loans were overly harsh and one-sided and thus substantively unconscionable. Defendants also failed to meet their burden in summary judgment to show that homeowner could not establish the tender requirement element because their motion did not address a pertinent exception to the tender requirement, which the homeowner had raised in his complaint.
Lona v. Citibank, N.A.
filed December 21, 2011, Sixth District
Cite as H036140
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Los Angeles County Bar Association
2012 Real Property Section Newsletter
REAL PROPERTY SECTION PUBLICATIONS
Daniel L. Goodkin, Editor, Real Property Section Review
Norman A. Chernin, Editor, Real Property Section Newsletter

SECTION OFFICERS
Chair
Gregg J. Loubier

First Vice Chair
Theresa C. Tate

Second Vice Chair/Crocker Chair
Sarah V. J. Spyksma

Treasurer
Norman A. Chernin

Secretary
Brant Dveirin

Immediate Past Chair
Pamela L. Westhoff

Section Administrator
Fatima Jones

EXECUTIVE COMMITTEE MEMBERS

Eric Altoon
Nedra E. Austin
Susan J. Booth
Claire Hervey Collins
Caroline Dreyfus
Robert T. Flick
Daniel L. Goodkin
Marcia Z. Gordon
Ryan Iwasaka

Linda S. Koffman
Trudi J. Lesser
Peter J. Niemiec
Robert C. Pearman
Leslie D. Reed
D. Eric Remensperger
Michael G. Smooke
Linda E. Spiegel
Andrew J. Yamamoto


SUBSECTION CHAIRS
Commercial Development and Leasing, Nadav Ravid
Construction Law, Shaaron Bangs
Land Use Planning and Environmental Law, Laurence L. Hummer
Real Estate Finance, Owen P. Gross
General Real Estate Law, Marybeth Heydt
Title Insurance, Vickie Perkowitz

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