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Introductory Comment

Coming Events

Recent Cases

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An ePublication of the Los Angeles County Bar Association
Volume 8, Number 4 • April 2013 • Archive of Past Issues
Real Property Home Page

Introductory Comment

In my continuing efforts to keep my readers up to date on the newest developments of interest to real estate practitioners, you might be interested to know that the latest idea to create affordable housing is to use discarded cardboard shipping containers from China, and I don't mean on Skid Row. Thanks to David Glantz of Jeffer Mangels for passing along an article from the National Real Estate Investor describing how Three Squared, Inc. is doing it.


Norm Chernin, Editor, Real Property Section Newsletter
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Coming Events

    LACBA Real Property

    The Real Property Law Section of the State Bar is hosting its 32nd Annual Real Property Retreat, featuring a total of 27.75 hours of MCLE credits in a wide variety of real property topics and related legal areas, wine tasting, dinners and other social events. The Retreat will be held at the beautiful Silverado Resort in Napa, CA, from April 26, through April 28, 2013. Come meet lawyers from around the state at an educational, informal and fun event. For more information look here.
    Members of the Real Property Section, LACBA, may register at the member discount rate for members of the State Bar Real Property Law Section.

    Additional Programs
    (Click Here for Details)

    04/25/2013 Bankruptcy Filings by Cities (12:30 PM)
    Many municipalities are experiencing or will experience significant fiscal distress. This program will explore the common sources of fiscal distress for municipalities and some of the avenues for addressing the problems, including Chapter 9.

    05/07/2013 2013 California Tax Practitioners' Conference (8:30 AM)
    Join us for the 2013 California Tax Practitioners' Conference, which promises to attract California's most powerful and respected tax professionals for a day of continuing educational seminars and interactive dialogue.

    05/15/2013 Financing Your Public-Private Deal – 2013 and Beyond (5:30 PM)
    Timed to coincide with major developments in the laws and practice, this program features a distinguished panel that will look at existing and evolving financing structures and sources for developing major commercial real estate projects.

    06/05/2013 2nd Annual Barristers Summer Bash: House of Barristers (6:00 PM)
    Join LACBA Barristers at the world-famous House of Blues for a night of food, fun, and live entertainment. Meet and mingle with law students, summer associates, government and public interest summer interns, and new attorneys in Los Angeles.



Recent Cases

City correctly determined that proposed development of a 7.2-acre parcel, within a transit center for which an environmental impact report (“EIR”) was previously prepared and certified, qualified for exemption under Government Code Section 65457, which provides an exemption from environmental review for a residential development that is consistent with a broader specific plan for which an EIR previously has been certified.
Concerned Dublin Citizens v. City of Dublin (AvalonBay Communities, Inc.) - filed March 7, 2013, publication ordered March 28, 2013, First District, Div. Three
Cite as A135790
Full text

Insurance company--which made payments to its insured for environmental response costs that insured incurred in cleaning up pollutants released on its property--lacked standing to bring suit under Comprehensive Environmental Response, Compensation, and Liability Act Section 107(a). It did not incur any "costs of response" related to the removal or Section 107(a) remediation of a polluted site, and the common law principle of subrogation does not apply to Section 107(a). Insurance company could not bring a subrogation claim under CERLCA Section 112(c) because the company did not allege that the insured was a "claimant" or that it had made a claim either to the Superfund or to a potentially liable party.
Chubb Custom Insurance Company v. Space Systems/Loral, Inc. - filed March 15, 2013
Cite as 11-16272
Full text

Construction Law
Government Code Section 901 provides in part that a cause of action for equitable indemnity or partial equitable indemnity against a public entity accrues when the defendant is served with "the complaint giving rise to the defendant's claim for equitable indemnity." Service of a homeowners' association's original complaint against a builder--alleging violations of various statutory building standards related to the builder’s construction of a multistory residential building--did not cause the builder’s claim for equitable indemnity to accrue where the original complaint did not encompass the claim for which indemnity was sought.
Centex Homes v. Superior Court (City of San Diego) - filed March 25, 2013, Fourth District, Div. One
Cite as D062995
Full text

Fannie Mae and Freddie Mac
Federal Housing Finance Agency’s "directive" preventing Freddie Mac and Fannie Mae from buying mortgages on properties encumbered by liens made under "property-assessed clean energy programs"--which finance environmental improvements on residential properties--was a lawful exercise of the agency’s statutory authority as conservator of Freddie Mac and Fannie Mae. Agency’s exercise of its authority as conservator is beyond judicial review.
County of Sonoma v. Federal Housing Finance Agency - filed March 19, 2013
Cite as 12-16986
Full text web_revised

Mechanic’s Liens
Civil Code Section 3123(a)--which provides that a mechanic’s lien is to be valued either at the reasonable value of the work or materials, or at the contract price, whichever is less--applies without regard to whether the property owner is a party to the contract.
Appel v. Superior Court (Webcor Construction, Inc.) - filed March 11, 2013, Second District, Div. Seven
Cite as 2013 S.O.S. 1201
Full text

Nuisance Abatement Action Counter-Attack
Cross-complaint to nuisance abatement action--in which property owner alleged that city employees had committed slander, trade libel, and intentional interference with prospective advantage by telling potential licensees they would not be able to obtain licenses to perform business activities at the property because of criminal activity by the cross-complainant--implicated free speech and petition rights in connection with a public proceeding, within the meaning of the anti-SLAPP statute. Where statements were made to the effect that illegal activity was taking place on cross-complainant’s property, burden was on cross-complainant to show that such activities were not taking place at the time.     
City of Costa Mesa v. D’Alessio Investments, LLC
- filed March 11, 2013, Fourth District, Div. Three
Cite as 2013 S.O.S. 1191
Full text

Real Property Taxation
In using the "weighted average cost of capital" method to calculate the capitalization rate as part of property valuation under the "income" method, the appropriate tax rate for the conversion from an after-tax to a before-tax discount rate is the typical potential purchaser’s expected combined California and federal marginal income tax rate. Where assessor erroneously used an average rate that included taxes paid to other states, the trial court correctly concluded the county’s valuation method was arbitrary and inconsistent with the standards set out in the assessor’s handbook. Trial court erred in recalculating property values and tax rather than remanding to the assessment appeals board for a redetermination, where factual issues remained regarding the correct expected combined federal and state marginal income tax rate applicable to a typical potential purchaser of the property in issue.
Sky River LLC v. Kern County - filed February 21, 2013, publication ordered March 15, 2013, Fifth District
Cite as F063766
Full text

Residential Mortgage Loans
When a borrower complies with all the terms of a "trial period plan" (“TPP”) under the Home Affordable Mortgage Program (“HAMP”), and the borrower’s representations remain true and correct, the loan servicer must offer the borrower a permanent loan modification, and the borrower may sue the lender or loan servicer if the TPP is breached. Plaintiff’s failure to allege a tender of her indebtedness was fatal to her cause of action to set aside foreclosure sale based on procedural irregularities in the sale, and lack of such tender was not excused by defendant’s alleged breach of the TPP. Allegations of promise and detrimental reliance--including that defendant "made clear, definite and certain promises to Plaintiff to induce her to enter into oral executed and written HAMP agreements, including promises not to sell during the HAMP reevaluation [and] that there was no foreclosure date pending," and that plaintiff was thus willing to forebear from suing and to continue making payments--pled a cause of action for promissory estoppel. Allegations--that defendant engaged in a practice of making TPPs that did not comply with HAMP guidelines and Department of the Treasury directives, made misrepresentations regarding a borrower’s right and ability to challenge the bank’s calculation of net present value, made misrepresentations about pending foreclosure sales, and wrongfully had trustee’s sales conducted when the borrower was in compliance with a TPP--were sufficient to plead a claim under the Unfair Competition Law.
West v. JPMorgan Chase Bank, N.A. - filed March 18, 2013, Fourth District, Div. Three
Cite as G046516
Full text

School Parcel Taxation
School parcel tax measure taxing residential and commercial/industrial properties differently, by making one tax rate applicable to all residential and smaller commercial properties, while applying a higher rate to larger commercial properties, violated uniformity requirement of Government Code Section 50079.      
Borikas v. Alameda Unified School District
- filed March 6, 2013, First District, Div. One
Cite as 2013 S.O.S. 1160
Full text

Trust Deed Foreclosure
In wrongful foreclosure action brought by borrower against successor to insolvent lender, trial court properly took judicial notice of the fact and legal effect of the government’s contract with defendant--absolving defendant of certain of its predecessor’s liabilities--because plaintiff made no showing in the trial court that the contract was not authentic nor argued that it was reasonably subject to dispute. Provision absolving successor lender of liabilities connected with plaintiff’s loan extended to claims of wrongdoing by the original lender, who assigned the loan to the insolvent lender, or by others who did not deal with defendant and to claim that defendant lacked standing to foreclose.
Scott v. JPMorgan Chase Bank, N.A. - filed March 18, 2013, First District, Div. Five
Cite as A132741
Full text

Trust Deed Foreclosure
In wrongful foreclosure action, which included a claim based on defendants’ alleged failure to contact plaintiff or attempt with due diligence to contact her before recording the notice of default as required by Civil Code Section 2923.5, it was error to take judicial notice of defendants’ compliance with the statute. Declaration attached to notice of default could not be judicially noticed where its truth was challenged by plaintiff. Plaintiff’s allegations that defendants did not comply with Section 2923.5 were sufficient to state a cause of action for wrongful foreclosure.
Intengan v. BAC Home Loans Servicing LP - filed March 22, 2013, First District, Div. Five
Cite as A135782
Full text

Los Angeles County Bar Association
2013 Real Property Section Newsletter


Daniel L. Goodkin, Editor, Real Property Section Review
Norman A. Chernin, Editor, Real Property Section Newsletter

Theresa C. Tate

First Vice Chair
Sarah V. J. Spyksma

Second Vice Chair
Norman A. Chernin

Brant Dveirin

Secretary/Crocker Chair
Susan J. Booth

Immediate Past Chair
Gregg J. Loubier

Section Administrator
Fatima Jones


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

Commercial Development and Leasing, Nadav Ravid
Construction Law, Shaaron Bangs
Finance, Benjamin Howell
General Real Estate Law, Marybeth Heydt
Land Use Planning and Environmental Law, Glenn Block
Title Insurance, Jesse Hernandez

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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.

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