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Introductory Comment

Coming Events

Recent Cases


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An ePublication of the Los Angeles County Bar Association
Volume 7, Number 6 • June 2012 • Archive of Past Issues
Real Property Home Page


Introductory Comment

I think that you will find several somewhat offbeat cases this month. I tried to highlight them with unusual headings. I hope that all of you are able to find some time this summer to relax and enjoy yourselves.

Sincerely,

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

Coming Events

SAVE THE DATE!!!
The Crocker Symposium will be held on October 26, 2012. There will be updates in later newsletters.

Recent Cases

From June 1 to June 30

Bankruptcy -- Credit Bid
Bankruptcy court properly disallowed plan under which debtors would sell encumbered asset at auction free and clear of lien without permitting creditor to bid using amount of debt as offset against purchase price.
Radlax Gateway Hotel, LLC v. Amalgamated Bank
filed May 29, 2012
Cite as 11-166
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Coastal Commission
Coastal Commission acted in excess of its jurisdiction when it approved amendments to a city's certified local coastal program at the request of state agencies over the objections of the city, where the amendments were not requested to undertake a public works project or energy facility development but instead changed the city's land use policies and development standards as they would apply to future plans for development within the city.
City of Malibu v. California Coastal Commission (Santa Monica Mountains Conservancy)
filed May 10, 2012, Second District, Div. Eight
Cite as 2012 S.O.S. 2246
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Construction Law
Agreement between general contractor and subcontractor that attorney's fees would be recoverable by the prevailing party in "any dispute resolution" arising "under or relating to...the Subcontract" was broad enough to authorize recovery of fees by subcontractor after it successfully defended against contractor's cross-complaint in action in which plaintiff accused contractor of causing auto collision and contractor alleged that the subcontract required subcontractor to defend and indemnify.
Toro Enterprises, Inc. v. Pavement Recycling Systems, Inc.
filed April 9, 2012, publication ordered May 1, 2012, Second District, Div. Six
Cite as B234627
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Construction Law
Where plaintiff was a subcontractor on the general contractor's contract with city for public improvements, the subcontract was for a "work of improvement contracted for by a public entity" within the meaning of Civil Code Section 3100, and service of preliminary lien notice in connection with a private work, pursuant to Section 3097, did not substantially comply with public-work notice requirement of Section 3098.
California Paving & Grading Co., Inc. v. Lincoln General Insurance Company
filed May 21, 2012, Second District, Div. Three
Cite as B228930
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Construction Law
Material-man under direct contract to owner was not required to give a 20-day preliminary lien notice to owner, original contractor, or lender under Civil Code Section 3097(a), but was required to give a preliminary notice to the construction lender under Section 3097(b). The two provisions are separate and exclusive, not alternative, and material-man's direct contract with owner did not make it a contractor, which would make it exempt from the notice requirements.
Shady Tree Farms v. Omni Financial
filed May 22, 2012, Fifth District
Cite as F062924

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Contract Interpretation
When a contract does not define the phrase "best efforts," the promisor must use the diligence of a reasonable person under comparable circumstances, not the diligence required of a fiduciary.     
California Pines Property Owners Association v. Pedotti
filed May 24, 2012, Third District
Cite as C0663155
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Eminent Domain
Property owner claiming permanent severance damages in eminent domain case was not required to show substantial impairment of access to his property to have his evidence admitted. Trial court erred in excluding evidence supporting plaintiff’s claims of a decrease in value of his property due to view changes, effects on drainage, changes in the depth of utility lines, and increased traffic hazards as a result of city project.
City of Livermore v. Baca
filed May 16, 2012, Sixth District
Cite as H034835
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Forged Deeds
Trial court properly applied "unclean hands" doctrine to prohibit administrator of the estates of the co-owners of a piece of property from challenging forged deed, where administrator attempted to benefit personally from the forgery by filing a defective mechanic's lien against the property--even though he was not a contractor and had not given a preliminary lien notice--and bringing an action to quiet title in himself, contrary to the rights of the other heirs.
 Estates of Collins and Flowers
filed May 10, 2012, Third District
Cite as 2012 S.O.S. 2251

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Landlord and Tenant
Where a commercial lease allows tenant to extend for a definite period, a special rule of construction provides that only one extension will be allowed unless the lease unambiguously permits multiple extensions. Trial court ruling construing lease as allowing multiple extensions of the lease term was erroneous as a matter of law where the specific language related to extension of the lease term was ambiguous, and the lease as a whole did not reflect an intent to allow multiple extensions.

Ginsberg v. Gamson
filed April 30, 2012, Second District, Div. Eight
Cite as B222284
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Mobile Home Park Property Taxation
County assessor’s use of "extraction method" of valuing interests in a mobile-home park--whereby assessor arrived at the value of the space underlying mobile-home by subtracting the purchase price of the mobile-home from the mobile-home's value as established by an authorized valuation manual--was contrary to Revenue and Taxation Code Section 62.1, which as amended provides that a transfer of stock or an ownership interest in a mobile-home park is a change of ownership of a pro rata portion of the real property in the park, if ownership of the park had previously been transferred to a nonprofit corporation for the benefit of the residents and had not been converted to condominium or stock cooperative ownership. Plain language of the statute requires that the value of the underlying space be determined by multiplying the fractional interest in the park represented by the underlying space by the appraised value of the entire mobile-home park at the time of sale.
 Assessor for County of Santa Barbara v. Assessment Appeals Board No. 1 (Rancho Goleta Lakeside Mobileers, Inc.)
filed May 16, 2012, Second District, Div. Six
 Cite as B229656
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Real Property Litigation
Three-year statute of limitations for injury to real property can be invoked only by owner of the property, not by a person with an option to buy the property. Two-year statute applied to action by option-holder harmed by clouding of title to property.
Cyr v. McGovran
filed May 29, 2012, Second District, Div. Six
Cite as B231155A


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RESPA
To establish a violation of 12 U.S.C. Section 2607(b)--part of the Real Estate Settlement Procedures Act, providing that "[n]o person shall give and no person shall accept any portion, split, or percentage of any charge made or received for the rendering of a real estate settlement service...other than for services actually performed"--a plaintiff must demonstrate that a charge for settlement services was divided between two or more persons. The statute cannot be understood to reach a single provider’s retention of an unearned fee.
Freeman v. Quicken Loans, Inc.
filed May 24, 2012
Cite as 10-1042

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SLAPP-ed around by un-Civil Procedure
When developer sued city to enforce contract requiring city to install certain infrastructure on developer's property, and city alleged in cross-complaint that the filing of the suit was an unlawful business practice because the developer had bribed a council member in order to get the city to enter into the contract, the filing of the suit constituted protected activity under the anti-SLAPP statute, but the bribery did not; proper disposition of such a "mixed cause of action" is to strike the portions that fall within anti-SLAPP protections, absent a showing that the party bringing the cause of action is likely to prevail. "Public enforcement" exception to the anti-SLAPP statute does not apply unless suit is brought "in the name of the People," and the "public interest" exception does not apply when the cause of action is brought primarily to assert a public entity's financial interests.
City of Colton v. Singletary
filed May 30, 2012, Fourth District, Div. Two
Cite as E052377

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Subdivisions - Slander of Title
Where plaintiff homeowners sought a judicial determination of their alleged right to maintain their community as a private, gated subdivision and to have unrestricted use of a road inside the gate for access to river that the community overlooked--as well as damages for alleged slander of title and related tort causes of action--and defendant owners of surrounding property cross-complained, claiming that the public had a right of access to the river from the road and consequently the subdivision map would have to be reformed or amended to specifically provide for such access, the cross-complaint was subject to the 90-day statute of limitations contained in the Subdivision Map Act. A slander of title cause of action may be maintained where the only pecuniary damages proven by plaintiffs are the attorney fees incurred to clear the slandered title, at least where the slander of title was by means of a recorded instrument.
 Sumner Hill Homeowners’ Association, Inc. v. Rio Mesa Holdings, LLC
filed May 2, 2012, Fifth District
Cite as F058617
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Trespass to Land -- Cowabunga
Nonsuit was properly granted in action brought by motorcyclist who incurred injuries when he collided with cow on private road on which he was trespassing. Landowners owed no duty to prevent access to road by erecting fence. A cow is not an inherently dangerous animal.
Thomas v. Stenberg
filed May 29, 2012, First District, Div. One
Cite as A132431


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Trust Deeds
Lender may designate an entity such as Mortgage Electronic Registration Systems as nominee beneficiary of a deed of trust. Such nominee may assign its interest, so its assignee or a subsequent assignee may foreclose. Where nominee beneficiary assumed all interest and rights of the lender and its successors and assigns--and then assigned its interests to another entity, which assigned its interests to defendant--defendant had the authority, as either a successor or assign of the original lender or as an assignee of the nominee beneficiary, to execute a substitution of trustee, notwithstanding language in the deed of trust suggesting that only the original lender could do so.
 Herrera v. Federal National Mortgage Association
filed May 17, 2012, Fourth District, Div. Two
Cite as E052943

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Whack-a-Mole as Applied to the Recording Law
Property owner named lender as a defendant in quiet title action and recorded notice of lis pendens. Lender made an assignment of its deed of trust,  but the assignment was not recorded, and property owner was unaware of it. Property owner subsequently dismissed lender from her quiet title action, as lender was then in bankruptcy, and chose to pursue lender in bankruptcy court rather than seek relief from the automatic stay. Property owner thereafter obtained a judgment purporting to quiet title in her in fee simple. That judgment did not invalidate the assigned deed of trust, since assignee was not a party to the quiet title action and thus not bound by the judgment.
 Deutsche Bank National Trust Company v. McGurk
filed May 22, 2012, Second District, Div. Three
Cite as B231591


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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
Theresa C. Tate

First Vice Chair
Sarah V. J. Spyksma

Second Vice Chair
Norman A. Chernin

Treasurer
Brant Dveirin

Secretary
Susan J. Booth

Immediate Past Chair
Gregg J. Loubier

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, Vicki Perkowitz

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

The foregoing practice tips were prepared for information purposes only. Such practice tips do not constitute tax, legal or other advice and no responsibility is assumed for any reliance upon them or with respect to assessing or advising the reader as to tax, legal, or other consequences arising from a particular situation. The accuracy of the information
provided should be independently verified by the reader and should not be treated as authoritative.