Vol. II, No. 5 Join the Real Property Section Contact Us

March, 2007


Recent Cases

Public Resources Code Sec. 21177(b), which requires that a citizen objecting to a project under CEQA do so during public comment period or prior to the close of public hearing to retain standing to challenge the project in court, did not bar action where local agency did not hold a public hearing within the meaning of the statute but merely an informational meeting on a tentative agreement, the approval of which it did not consider to be an approval of a project within the meaning of CEQA, and where no notice of determination was issued following the meeting. Agreement for development of natural resource that was conditional on subsequent CEQA review did not itself constitute a "project" within the meaning of CEQA.
     Concerned McCloud Citizens v. McCloud Community Services District - filed January 2, 2007, publication ordered January 31, 2007, Third District
     Cite as 2007 SOS 603
Full text

Grant of demolition permit for historic structure so that owner could construct smaller residence on site violated California Environmental Quality Act where agency failed to support its finding that rehabilitation of the structure was economically infeasible with evidence that a suitable new house could be built at less cost.
     Uphold Our Heritage v. Town of Woodside (Jobs) - filed January 10, 2007, publication ordered February 7, 2007, First District, Div. Three
     Cite as 2007 SOS 730
Full text 

Public agency’s sale of land containing a disused but historic railroad right-of-way to an entity that owned surrounding property and was known to plan on developing it--but had never presented any development plans to any agency--was not a project requiring environmental review under CEQA.
     Friends of the Sierra Railroad v. Tuolumne Park and Recreation District (Tuolumne Band of Me-Wuk Indians) - filed January 12, 2007, publication ordered February 8, 2007, Fifth District
     Cite as 2007 SOS 745
Full text 

City failed to comply with statutory requirement that it prepare an EIR for any project that it "proposes to carry out or approve that may have a significant effect on the environment" where it obtained federal financing for project but deferred environmental review until after it reached agreements with developers seven months later.
     Save Tara v. City of West Hollywood (WASET, Inc.) - filed February 21, 2007, Second District, Div. Eight
     Cite as 2007 SOS 889
Full text 

City did not abuse its discretion in issuing a grading permit without conducting an environmental review of the permit's impact pursuant to the California Environmental Quality Act where city concluded project was exempt from compliance with CEQA because it involved grading on land with a slope of less than 10 percent, and grading permit was consistent with conditional use permit, which contemplated the use of fill as part of the grading process, although no specific amount of fill was mentioned at that time. Issuance of grading permit with no conditions was a ministerial, not discretionary act, and thus exempt from CEQA compliance.
     Madrigal v. City of Huntington Beach - filed January 31, 2007, publication ordered February 27, 2007, Fourth District, Div. Three
     Cite as 2007 SOS 1016
Full text 

-Eminent Domain-
Under state eminent domain law, a statutory property valuation date that occurs at the time the condemner deposits the probable compensation in court, when litigation in the eminent domain action is not expected to end until several years after the deposit is made, does not deny the property owner just compensation under the state constitution. The statutory requirement of a waiver of claims and defenses for receipt of deposited probable compensation is not an unconstitutional condition on the statutorily required "prompt release" of the deposit.
     Mt. San Jacinto Community College District v. Superior Court (Azusa Pacific University) - filed February 22, 2007
     Cite as 2007 SOS 876
Full text 

-Environmental Impact Report-
Environmental impact report for land development project was deficient where, although it adequately informed decision makers and public of county’s plan for near-term provision of water to development, it failed to do so as to the long-term provision by identifying the intended water sources in general terms but not clearly and coherently explaining--using material properly stated or incorporated in the EIR--how the long-term demand is likely to be met with those sources, the environmental impacts of exploiting those sources, and how those impacts are to be mitigated. Where various groups advised county of concerns about development’s potential impact on salmon migration, county should have revised and recirculated draft EIR for public comment on the newly disclosed potential impact rather than simply including a brief statement in final EIR that salmon migration might be affected.
     Vineyard Area Citizens for Responsible Growth, Inc. v. City of Rancho Cordova - filed February 1, 2007
     Cite as 2007 SOS 572
Full text 

-Environmental Impact Report-
Fact that initial draft of EIR was prepared by counsel for applicants did not render it "biased and legally inadequate" where it was reviewed and modified by agency staff, closely scrutinized by independent consultants, and adopted in final form as reflecting the judgment of the agency. Agency’s findings on noise impact, aesthetic, and safety issues were entitled to deference and were sufficient where explained in EIR.
     Eureka Citizens for Responsible Government v. City of Eureka (Eureka Church of the Nazarene) - filed January 8, 2007, publication ordered February 1, 2007, First District, Div. Five
     Cite as 2007 S.O.S. 631
Full text 

-Land Use-
Ninety-day period in which to seek writ of mandate following denial of zoning variance did not commence to run until city gave mandatory written notice of property owners' right to seek writ. Property owners were not entitled to equitable relief from denial of variance request where their contractor built addition to their home without obtaining legally required approvals. Absent direct evidence as to how much time judge spent in evaluating evidence in mandate proceeding, where hearing commenced and was completed in one day, petitioners' failure to request statement of decision at close of hearing constituted waiver.
     Ciraulo v. City of Newport Beach - filed January 17, 2007, publication ordered February 15, 2007, Fourth District, Div. Three
     Cite as 2007 SOS 855
Full text 

-Landlord and Tenant-
Where lease allowed prevailing party to recover attorney fees in any dispute between the parties, landlord prevailed before bankruptcy judge on motion to dismiss tenant’s Chapter 11 petition on ground that it was filed in a bad faith effort to avoid paying rent despite tenant’s solvency, tenant continued to not pay rent after petition was dismissed, and landlord sued for breach of lease, landlord properly stated claim for attorney fees incurred in the bankruptcy proceedings.
     Circle Star Center Associates, L.P. v. Liberate Technologies - filed February 22, 2007, First District, Div. Three
     Cite as 2007 SOS 933
Full text

-Mitigated Negative Declaration-
Approval of development project with mitigated negative declaration did not violate CEQA where evidence suggesting proposed project might contribute to a severe groundwater overdraft consisted largely of opinions of persons with little technical expertise and failed to discredit the specific technical analyses and conclusions reached by qualified experts in site-specific studies or the testimony that there was an adequate water supply for the project, and agency prepared MND only after it had independently reviewed and exercised its judgment over initial study, information and material submitted by property owners and their consultants, and testimony of witnesses.
     Landwatch Monterey County v. County of Monterey (Chapin) - filed January 23, 2007, publication ordered February 21, 2007, Sixth District
     Cite as 2007 SOS 897
Full text 

-Property Taxation-
Lawsuit challenging a special assessment levied under the Municipal Improvement Act of 1913 for failure to comply with Proposition 218--which requires that certain types of assessments be treated as taxes subject to a public vote--is subject to special procedural rules applicable to "validation actions," including requirement that plaintiffs publish notice of the action and file proof of publication within 60 days after the filing of the complaint absent good cause for not doing so. Where plaintiffs made no effort to publish notice of the action until after 60-day period had run, trial court did not abuse its discretion in finding that they lacked good cause for noncompliance with the validation statutes even if they acted in good faith by serving all affected property owners by mail and even if defendant municipality suffered no prejudice. Neither defendant’s filing of answer and opposition brief addressing merits nor its failure to oppose plaintiffs’ ex parte motion to amend summons to include "all interested persons" constituted a waiver of plaintiffs’ failure to comply with validation statutes.
     Bonander v. Town of Tiburon - filed January 31, 2007, publication ordered February 22, 2007, First District, Div. Three
     Cite as 2007 SOS 946
Full text 

-Purchase and Sale Agreement-
Where sellers reneged on contract for sale of property, trial court properly ordered specific performance and awarded buyers attorney fees pursuant to contract but erred in allowing buyers to deduct the attorney fees from the purchase price, effectively giving attorney a preference over priority lien holders.
     Behniwal v. Mix - filed February 7, 2007, Fourth District, Div. Three
     Cite as 2007 SOS 736
Full text 

-Rent Control-
Rent control guidelines, under which it was presumed that "net operating income"--gross income minus operating expenses--in base year provided landlord with a just and reasonable return above the required minimum absent clear and convincing evidence to the contrary, but landlord could seek a discretionary increase, in which case preferred method was to adjust the base year NOI by 50 percent of the increase in the consumer price index from the base year to the comparison year, the latest calendar year or the latest fiscal year used by the applicant for accounting purposes, then grant an increase in the amount by which the sum of the applicant's base year NOI and the price level adjustment exceeds the applicant's comparison year NOI, but landlord could obtain a larger increase by presenting clear and convincing evidence that another method was more appropriate, did not "take" landlord’s property or deprive landlord of substantive due process in violation of state and federal constitutions. Landlord’s right to procedural due process did not require rent board to allow cross-examination at administrative hearing.
     Stardust Mobile Estates v. City of San Buenaventura - filed February 22, 2007, Second District, Div Six
     Cite as 2007 SOS 936
Full text

-Title Insurance-
Where former buyer in canceled real property sale sued sellers for specific performance and placed a lis pendens on the property with the recorder’s office the day before the property closed escrow with purchasers, and lis pendens was not indexed until four days after closing, trial court properly concluded that purchasers were bona fide purchasers and encumbrancers for value who took their interests without knowledge of former buyer’s claim because they could not have located the lis pendens by a diligent title search at the time of closing and thus did not have constructive notice of former buyer’s claim.
     Dyer v. Martinez - filed February 23, 2007, Fourth District, Div. Three
     Cite as 2007 SOS 943
Full text 

-Water Law-
In dispute among owners of a common law right to appropriate water from a natural watercourse, in which trial court declared a forfeiture of certain previously appropriated waters because defendant failed to use some portion of its water entitlement continuously over a span of five years immediately prior to the plaintiff's assertion of its conflicting right to the water, trial court correctly measured five year period as ending when the parties' "clash of rights" occurred, rather than at earlier time when defendant did not own the water rights in question and was merely negotiating and preparing for purchase of those rights. Evidence that, as a historical practice, the parties used a daily measurement of entitlement to water, but that, at least during the forfeiture period, the parties did not retain the records of use for each day but, instead, consolidated those daily records into monthly reports, which were preserved as the official records of the parties, supported trial court's decision to use a monthly measurement period to determine extent of defendant's failure to use. Actual entitlement of a junior appropriator must include all water in the river to which it has a right of access, including release water actually available to it. Trial court ruling that "all water forfeited by [defendant] reverts to the 'public' and is available for appropriation through the 'permit procedures' of the California Water Code" was error to extent that it treated forfeiture as being of water as opposed to water rights, but was correct in rejecting contention that forfeited rights reverted to plaintiff; initial determination whether the forfeiture creates an allocable excess is reserved in the first instance to the State Water Resources Control Board.
     North Kern Water Storage District v. Kern Delta Water District - filed February 5, 2007, Fifth District
     Cite as 2007 SOS 701
Full text

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Loan Workouts-Before & After Bankruptcy  
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Steve Fein, DLA Piper Rudnick Gray Cary US, LLP
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Effective Use of Experts  
Sponsoring Subsection:  Construction Law
George D. Calkins II, Cox, Castle & Nicholson LLP
Hon. Victoria G. Chaney, Judge of the Los Angeles Superior Court
Gary Halpin
LACBA Conference Center, 281 S. Figueroa Street , Los Angeles

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Benjamin S. Crocker Symposium on Real Estate Law and Business 2006
Featured Speakers:
Dean Adler, Lubert-Adler
Jane Blumenfeld, City of Los Angeles Department of Planning
Wayne Brandt, RBS Greenwich Capital
Anthony Downs, The Brookings Institution
William H. Jackson III, Chairman of the Board of Commissioners of the CRA/LA
Patrick A. Randolph, University of Missouri-Kansas City School of Law
Wayne Ratkovich, The Ratkovich Company
Kenneth Wong, CEO, Westfield America, Inc.
Millennium Biltmore Hotel, 506 South Grand Avenue, Los Angeles, California
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Save the Date!  June 19, 2007: 
Real Property Section Ninth Annual Installation and Awards Dinner
Riviera Country Club, 1250 Capri Drive , Pacific Palisades
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Los Angeles County Bar Association
2007 Real Property Section Newsletter

Daniel L. Goodkin, Editor    *   Norman A. Chernin, Co-Editor

Norma J. Williams

First Vice-Chair
Timothy M. Truax

Second Vice-Chair
Donald C. Nanney

Michael S. Klein

Pamela L. Westhoff

Immediate Past-Chair
Paula K. Reddish Zinnemann

Cecilia Gomez
Interim Section Administrator


Nedra Austin
Norman A. Chernin
Brant Dveirin
David Fu
Daniel L. Goodkin
John E. Hatherley
Trudi J. Lesser
Rebecca H. Lessley
Gregg J. Loubier
Phillip Nichols
Thomas F. Quilling

Patricia Higuera,
Barristers Liaison  

D. Eric Remensperger
Michael G. Smooke
Linda E. Spiegel
Sarah J. Spyksma
Theresa C. Tate
Pamela L. Westhoff
John W. Whitaker
Valerie Wisot
Andrew J. Yamamoto
Sharon Yarber

David Fu and
   Donald C. Nanney
State Bar Liaisons

Commercial Development & Leasing, Marcia Z. Gordon
Construction Law, Candace Matson
Land Use Planning & Environmental Law, Peter J. Niemiec
Real Estate Finance, Susan Booth
General Real Estate Law, Eric A. Altoon
Title Insurance, William H. Lynes (Chair) and
   William R. Larr (Co-Chair)