Vol. III, No. 3 Join the Real Property Section Contact Us
January 2008

An E-Publication of the Los Angeles County Bar Association


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Recent Cases
-Brokers-
-CEQA-
-Condemnation-
-Construction Law-
-Covenants, Conditions & Restrictions-
-Deed of Trust Foreclosure-
-Easements-
-Environmental Law-
-Home Equity Sales Contracts-
-Homeowners' Association-
-Inverse Condemnation-
-Landlord & Tenant-
-Land Use-
-Purchase & Sale Agreements-
-Real Estate Litigation-
-Receivers-
-Rent Control-
-Right of First Refusal-
-Subdivisions-
-Tenant Relocation Assistance-
-Unlawful Detainer-
-Water Law-



-Brokers-
Where buyers of real estate sued sellers, listing brokers, and buyers’ own brokers, and arbitration clause was contained in real estate sales agreement to which buyer and seller were parties but brokers were not, brokers for the buyers, as agents, could compel their principal to arbitrate but could not compel arbitration against listing brokers, who did not sign the agreement and had no preexisting confidential or contractual relationship with buyers’ brokers.
     Nguyen v. Tran - filed December 7, 2007, Fourth District, Div. Three
     Cite as 2007 SOS 7179
     
Full text 

-CEQA-
Environmental impact report for subdivision consisting of a specified number of lots for single family residences was not rendered inadequate by its failure to discuss possibility that future owners of the lots might obtain permits to build second, smaller dwellings on the lots where such possibility was purely speculative, and any such application would be subject to planning commission’s discretion. EIR failed to adequately analyze possible land exchange with federal Bureau of Land Management as an alternative to project where analysis was based on premise that BLM did not want the property, which was effectively contradicted by the BLM in its comments--which indicated that it was developer, not BLM, that was unwilling to participate in a land exchange--and where EIR included no meaningful information regarding any physical features, hydrological characteristics, views from the property, access to trails, or other attributes relevant to the suitability of the BLM property for the project. EIR adequately analyzed project’s impacts on special status species where its conclusion of "no significant impact" was supported by a physical survey of the project site, interviews with local agency personnel and wildlife experts, information from the California natural diversity data base, and local records. EIR adequately analyzed visual impacts of certain structures that were not specifically mentioned where public and decision makers were informed of their existence and could readily understand that they might be visible from outside the project, and EIR acknowledged that project would have a significant, irreversible adverse impact on existing scenic views of the area.
     Save Round Valley Alliance v. County of Inyo (Walters) - filed December 17, 2007, Fourth District, Div. Two
     Cite as 2007 SOS 7358
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-CEQA-
Water services portion of EIR for proposed mixed residential and commercial development in Santa Clarita Valley adequately analyzed water transfer agreement and remediation costs for perchlorate contamination of water wells where there was substantial evidence that future water sources identified in the EIR were reasonably likely to actually be available, perchlorate contamination was limited to only a few wells, and there was no reason to doubt that adequate funding would be made available to remediate the contamination.
     Santa Clarita Organization for Planning the Environment v. County of Los Angeles (Newhall Land and Farming Company) - filed November 26, 2007, Second District, Div. Six
     Cite as 2007 SOS 6875
     Full text 

-CEQA-
Letter by city's director of community development to developer--which was labeled "status report" and said "it has been determined" by an "[i]nitial staff review" that developer's plans for large retail store were in substantial conformance with master development plan--did not constitute an "approval" under CEQA, and thus did not trigger statute of limitations governing challenge to city's action, where letter was not posted, published, or otherwise made public, notwithstanding that the MDP authorized an appeal of director's decision by "[a]ny interested person" to city planning commission. Director's letter did not constitute a determination by a "public agency," and thus did not trigger statute of limitations, since director was not delegated and could not have been delegated authority to approve a project requiring environmental review.
     Stockton Citizens for Sensible Planning v. City of Stockton (A.G. Spanos Construction, Inc.) - filed November 28, 2007, Third District;
     Cite as 2007 SOS 6949
     Full text 

-CEQA-
Vague concerns about effect of housing project on aesthetics expressed by a few members of the public during public hearings did not constitute substantial evidence supporting a fair argument that project would have significant adverse environmental impacts, so city acted within its authority by issuing a mitigated negative declaration for the project rather than preparing an EIR. Adverse impact on property values as a result of construction of homes on smaller lots is an economic, not environmental, concern and is not considerable under CEQA. Concern that project would bring a large number of schoolchildren into the area and increase traffic was insufficient to require preparation of EIR where there was no evidence in the record that would correlate such density concerns to any specific adverse environmental impact. Contentions that city’s failure to comply with state CEQA guidelines resulted in a prima facie CEQA violation, that project was inconsistent with city’s general plan, and that general plan itself was inadequate were not subject to judicial review where not presented to city prior to adoption of mitigated negative declaration. Petitioner forfeited Subdivision Map Act claim by failing to object to tentative statement of decision or to otherwise alert trial court of its failure to expressly rule on the issue.
     Porterville Citizens for Responsible Hillside Development v. City of Porterville - filed November 9, 2007, publication ordered December 6, 2007, Fifth District
     Cite as 2007 SOS 7156
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-Condemnation-
Letters sent to redevelopment agency by representatives of subtenant of owner of condemned property did not substantially comply with requirements for claiming benefits under California Relocation Assistance Act where such correspondence contained no general description of the indebtedness, obligation, injury, damage, or loss incurred; or, to the extent it provided some description of what claimant sought to recover, lacked enough information for agency to thoroughly investigate the claim, negotiate a settlement, or prepare a defense. Commercial tenant "moves," thus triggering 18-month limitations period for claiming benefits under CRAA, when it "moves from" the condemned location, so claim made more than 18 months after moving from that location but within 18 months of moving into new location was untimely. Agency did not abuse its discretion in denying waiver of limitations period where claimant presented no evidence to explain why it took it so long to file the claim; never requested an extension to the time limit; and clearly knew of its right to relocation benefits, yet waited eight years to substantially comply with the claims presentation requirement.
     Bi-Rite Meat & Provisions Co. v. Redevelopment Agency of the City of Hawaiian Gardens - filed October 24, 2007, publication ordered November 19, 2007, Second District, Div. Seven
     Cite as 2007 SOS 6792
     Full text

-Condemnation-
In determining that condemning agency's final offer was unreasonable, and that condemnees were thus entitled to an award of litigation expenses under Code of Civil Procedure Sec. 1250.410, trial court's calculation of the relationship between final offer and award was erroneous--because compensation for fixtures was treated as part of award but not as part of offer, even though condemnees and agency had agreed on the amount--and trial court abused its discretion by improperly focusing on the conduct of the agency's appraiser, rather than on the conduct of the agency, in evaluating agency's good faith, care and accuracy in formulating its final offer.
     Redevelopment Agency of the City of Long Beach v. Morales - filed November 28, 2007, Second District, Div. Four
     Cite as 2007 SOS 6964
     Full text

-Condemnation-
Condemned property should have been valued as of date of payment of probable compensation rather than date of trial where public entity complied with "quick take" procedure, sole asserted ground for valuing property as of trial date was that amount of probable compensation failed to take into account the effect of subsequent rise in real estate market, and owners failed to show that statutory remedy of requesting an additional deposit, if it had been pursued diligently, would not have secured adequate relief to owners.
     Eastern Municipal Water District v. Superior Court (Tajik) - filed November 19, 2007, publication ordered December 14, 2007, Fourth District, Div. Two
     Cite as 2007 SOS 7346
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-Condemnation-
In eminent domain case involving partial condemnation of defendant's land, trial court properly changed date of valuation of condemned property from date plaintiff deposited probable compensation to date of trial, notwithstanding Mt. San Jacinto Community College District v. Superior Court (2007) 40 Cal. 4th 648, which set valuation date as date of deposit of probable compensation, where it was undisputed that deposit was substantially less than probable amount of just compensation. Under the plain meaning of Code of Civil Procedure Sec. 1263.110, a deposit amount that falls short of "probable compensation" does not set date of valuation, and proper statutory date of valuation is time of trial under Sec. 1263.130 where matter is not brought to trial within one year of commencement of eminent domain proceeding, and delay is not defendant’s fault. Trial court did not err in allowing defendant’s inverse condemnation cross-action to proceed with respect to same property listed in plaintiff’s direct condemnation action and in ordering plaintiff to take additional property not specified in resolution of necessity; preclusion of inverse condemnation proceedings in Sec. 1245.260 applies to proceedings brought under statute and not to those brought under Article I, Sec. 19 of the California Constitution. Defendant did not waive right to challenge scope of taking or to file a cross-complaint for inverse condemnation under Sec. 1255.260 by withdrawing probable compensation deposit because defendant’s claim was a claim for greater compensation. Trial court did not err in admitting opinion evidence of severance damages that was not properly exchanged under Sec. 1258.250 where it found that defendant made a good faith effort to comply with exchange requirements, and plaintiff was not prejudiced. Trial court did not err in allowing defendant to show jury conceptual plans for type of multiple residential development it claimed to be the property's highest and best use where such use was disputed because plans were only offered as illustration of one of uses to which property was adapted, and evidence was expressly limited by court to such object. Trial court did not err in admitting evidence of plaintiff’s value engineering decisions during planning phase of project where plaintiff did not cite and court of appeal was unable to find any case authority specifically addressing admissibility or exclusion of such evidence, and plaintiff did not convincingly argue that admission of value engineering evidence prejudicially affected jury's verdict. Trial court did not err in not excluding testimony of defendant’s appraiser on ground he failed to use or consider "zones of value" methodology in reaching value opinion where appraiser laid proper foundation for alternate methodology, and his opinion testimony fell within permissible range of options set by legal criteria. Trial court did not err in refusing to instruct jury on zones of value methodology where proposed instructions unduly emphasized plaintiff’s theory of valuation and amounted to improper argument to jury in guise of statement of law, and instructions actually given substantially and adequately covered subject of valuation.
     San Diego Metropolitan Transit Development Board v. RV Communities - filed December 21, 2007, Fourth District, Div. One
     Cite as 2007 SOS 7502
     Full text 

-Construction Law-
Where city entered into settlement agreement with general contractor on roadway refurbishment project for contractor's claims of extra construction costs resulting from latent defects in construction documents prepared by consultant, and city later filed suit against consultant, trial court erred in dismissing consultant's cross-complaint for indemnity and declaratory relief against contractor because settlement agreement did not encompass city's claims against consultant and expressly excluded claims related to latent defects, and contractor failed to establish that settlement had been entered in good faith within meaning of Code of Civil Procedure Secs. 877 and 877.6. Consultant's claim that contractor performed below applicable standard of care was sufficient to support a claim for comparative equitable indemnity, and court erred in dismissing matter after concluding that consultant's claim was based on breach of contract, rather than negligence or other tortuous conduct.
     Willdan v. Sialic Contractors Corporation - filed December 19, 2007, Second District, Div. Seven
     Cite as 2007 SOS 7408
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-Covenants, Conditions & Restrictions-
Where developer converted building into condominiums but either intentionally or inadvertently failed to completely perform its obligation to deed all the building’s parking spaces to homeowner’s association, four-year statute of limitations applicable to association’s quiet title action was not triggered until defendant, to whom the spaces were improperly deeded by developer after the time in which they should have been deeded to plaintiff, pressed his adverse claim. Where Conditions, Covenants & Restrictions required developer to transfer "all parking stall units to a residential unit owner" within specified time period or to "deed any remaining units to" plaintiff homeowner’s association, and developer did not transfer all the spaces to individual unit owners within that time, defendants could not transfer spaces to unit owners of their choice; their only lawful course of action was to transfer remaining spaces to plaintiff.
     Crestmar Owners Association v. Stapakis - filed December 13, 2007, Second District, Div. Eight
     Cite as 2007 SOS 7312
     Full text 

-Deed of Trust Foreclosure-
Non-judicial foreclosure proceedings, including notice of foreclosure, are not constitutionally protected activity under Code of Civil Procedure Sec. 425.16 (anti-SLAPP statute). Non-judicial foreclosure proceedings are not "official proceedings" under statute, despite being privileged under Civil Code Sections 47 and 2924, because scope of privilege and anti-SLAPP statute differ significantly. Where plaintiff’s wrongful foreclosure claim arose from a purely private transaction--defendant’s initiation of non-judicial foreclosure--defendant failed to establish that she was engaged in constitutionally protected speech or petitioning activity.
     Garretson v. Post - filed November 20, 2007, Fourth District, Div. Two
     Cite as 2007 SOS 6760
     Full text 

-Deed of Trust Foreclosure-
Default judgment invalidating trustee’s sale was subject to collateral attack by defaulting defendant, the buyer, where the seller and the trustee, indispensable parties to the original action, were not joined.
     Washington Mutual Bank v. Blechman - filed December 4, 2007, Second District, Div. Two
     Cite as 2007 SOS 7022
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-Easements-
Easement by necessity did not exist across defendants’ property in favor of plaintiff, the owner of neighboring property lacking access to a public road, where plaintiff’s predecessor in interest obtained the property by patent grant from the federal government, which did not include any grant of an easement over the access road from that property to the nearest public road; the only such access road ran across the neighboring property owned by defendants’ predecessor in interest; and at no time in the past had there been any express grant of an easement from the plaintiff’s property over the defendants’ property to that state highway, nor had there been an acquisition of an easement by prescription in favor of the plaintiff’s property, so that plaintiff’s property became "landlocked" without any express or prescriptive easement across defendants’ neighboring property to the state highway.
     Murphy v. Burch - filed November 19, 2007, First District, Div. One
     Cite as 2007 SOS 6787
     Full text 


-Environmental Law-
Water services portion of EIR for proposed mixed residential and commercial development in Santa Clarita Valley adequately analyzed water transfer agreement and remediation costs for perchlorate contamination of water wells where there was substantial evidence that future water sources identified in the EIR were reasonably likely to actually be available, perchlorate contamination was limited to only a few wells, and there was no reason to doubt that adequate funding would be made available to remediate the contamination.
     Santa Clarita Organization for Planning the Environment v. County of Los Angeles (Newhall Land and Farming Company) - filed November 26, 2007, Second District, Div. Six
     Cite as 2007 SOS 6875
     Full text 


-Environmental Law-
Where receiver sued insurer for failure to indemnify and defend receiver under policy covering pollution damage to real property, district court did not err in not considering evidence of cross-assignments of claims by plaintiff to vendee of real property on motion for summary judgment because evidence in opposition to motion indicated that no definitive agreement on cross assignments had actually been reached. District court did not err in not considering evidence of cross-assignments of claims on motion for reconsideration of summary judgment where new evidence showed precise terms of cross-assignment could have been brought to court’s attention at time of summary judgment. Insurer had no duty to indemnify receiver for difference between sale price received for polluted properties and fair market value of land had it been cleaned up prior to sale where contract did not require buyer to actually remediate pollution as a condition of sale. Diminution in value does not constitute a "physical injury," and receiver did not actually expend any money in cleanup. State Department of Ecology’s allegations of contamination created a duty by insurer to defend, despite receiver’s failure to timely tender a defense request, because claims for environmental remediation were potentially covered under policy and insurer failed to demonstrate that case was so "extreme" that prejudice determination should not be decided by a jury.
     Goodstein v. Continental Casualty Company - filed December 3, 2007
     Cite as No. 05-35805
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-Home Equity Sales Contracts-
Bonding requirement imposed on purchasers’ "representatives" by 1990 amendment to Home Equity Sales Contracts Act is applicable to all persons defined as "representatives" by the act and is not limited to agents representing undisclosed principals. Requirement that bond be posted "in an amount equal to twice the fair market value of the real property which is the subject of the contract" is unconstitutionally vague since it fails to inform a person of common intelligence whether a representative must have a separate bond for each transaction in an amount equal to at least twice the fair market value of the home subject to that transaction, or whether a representative may conduct multiple transactions under the umbrella of a single "blanket" bond as long as the blanket bond is at least twice the amount of the fair market value of the real property on any individual transaction. Bonding requirement is unconstitutionally vague where it fails to identify the obligee on the bond. Purchaser under home equity sales contract was not entitled to rescind due to alleged noncompliance with the requirement that the notice informing him of his right to cancel be in immediate proximity to the space reserved for his signature because HESC Act does not specify that a violation of that requirement provides grounds for rescinding a transaction after recordation of the deed, and because the purchase contract containing the required notice placed the notice in the paragraph following the signature line and on a page that required the seller to again sign by initialing.
     Schweitzer v. Westminster Investments - filed December 13, 2007, Fourth District, Div. One
     Cite as 2007 SOS 7263
     Full text 


-Homeowner’s Association-
Where developer converted building into condominiums but either intentionally or inadvertently failed to completely perform its obligation to deed all the building’s parking spaces to homeowner’s association, four-year statute of limitations applicable to association’s quiet title action was not triggered until defendant, to whom the spaces were improperly deeded by developer after the time in which they should have been deeded to plaintiff, pressed his adverse claim. Where Conditions, Covenants & Restrictions required developer to transfer "all parking stall units to a residential unit owner" within specified time period or to "deed any remaining units to" plaintiff homeowner’s association, and developer did not transfer all the spaces to individual unit owners within that time, defendants could not transfer spaces to unit owners of their choice; their only lawful course of action was to transfer remaining spaces to plaintiff.
     Crestmar Owners Association v. Stapakis - filed December 13, 2007, Second District, Div. Eight
     Cite as 2007 SOS 7312
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-Inverse Condemnation-
In eminent domain case involving partial condemnation of defendant's land, trial court properly changed date of valuation of condemned property from date plaintiff deposited probable compensation to date of trial, notwithstanding Mt. San Jacinto Community College District v. Superior Court (2007) 40 Cal. 4th 648, which set valuation date as date of deposit of probable compensation, where it was undisputed that deposit was substantially less than probable amount of just compensation. Under the plain meaning of Code of Civil Procedure Sec. 1263.110, a deposit amount that falls short of "probable compensation" does not set date of valuation, and proper statutory date of valuation is time of trial under Sec. 1263.130 where matter is not brought to trial within one year of commencement of eminent domain proceeding, and delay is not defendant’s fault. Trial court did not err in allowing defendant’s inverse condemnation cross-action to proceed with respect to same property listed in plaintiff’s direct condemnation action and in ordering plaintiff to take additional property not specified in resolution of necessity; preclusion of inverse condemnation proceedings in Sec. 1245.260 applies to proceedings brought under statute and not to those brought under Article I, Sec. 19 of the California Constitution. Defendant did not waive right to challenge scope of taking or to file a cross-complaint for inverse condemnation under Sec. 1255.260 by withdrawing probable compensation deposit because defendant’s claim was a claim for greater compensation. Trial court did not err in admitting opinion evidence of severance damages that was not properly exchanged under Sec. 1258.250 where it found that defendant made a good faith effort to comply with exchange requirements, and plaintiff was not prejudiced. Trial court did not err in allowing defendant to show jury conceptual plans for type of multiple residential development it claimed to be the property's highest and best use where such use was disputed because plans were only offered as illustration of one of uses to which property was adapted, and evidence was expressly limited by court to such object. Trial court did not err in admitting evidence of plaintiff’s value engineering decisions during planning phase of project where plaintiff did not cite and court of appeal was unable to find any case authority specifically addressing admissibility or exclusion of such evidence, and plaintiff did not convincingly argue that admission of value engineering evidence prejudicially affected jury's verdict. Trial court did not err in not excluding testimony of defendant’s appraiser on ground he failed to use or consider "zones of value" methodology in reaching value opinion where appraiser laid proper foundation for alternate methodology, and his opinion testimony fell within permissible range of options set by legal criteria. Trial court did not err in refusing to instruct jury on zones of value methodology where proposed instructions unduly emphasized plaintiff’s theory of valuation and amounted to improper argument to jury in guise of statement of law, and instructions actually given substantially and adequately covered subject of valuation.
     San Diego Metropolitan Transit Development Board v. RV Communities - filed December 21, 2007, Fourth District, Div. One
     Cite as 2007 SOS 7502
     Full text 


-Landlord and Tenant-
Landlord, which prevailed in an action brought against it by tenant alleging lack of habitability, presented sufficient evidence to withstand dismissal under the anti-SLAPP statute of its subsequent malicious prosecution action against tenant and her attorneys where landlord showed that tenant dismissed her action because it had become clear that she would not prevail, not because of her ill health as contended by counsel, and that the complaint included numerous causes of action that were pled by attorneys even though tenant provided them no information to support the claims. Landlord presented sufficient evidence to withstand anti-SLAPP motion brought by tenant’s co-counsel, who substituted in late in the litigation, because by associating in, co-counsel became the proponents of all tenant’s claims, including a large number of claims that were untenable on their face, and thus either knew or should have known of the significant deficiencies in tenant’s claims at the time they associated into the case, and did not take immediate steps to dismiss the meritless claims. Assertion by co-counsel that their role was to be "limited to the mold exposure aspect of the litigation," and that they "did not have any input in the decision to file" the underlying litigation "and [were] not involved in deciding which plaintiffs to include in the lawsuit or what allegations were made," and they "[a]t all times...believed that the lawsuit...was supported by probable cause and certainly was not being prosecuted with malice or ill will by anyone" was insufficient to withstand landlord’s prima facie showing that co-counsel lacked probable cause to pursue tenant’s claims.
     Sycamore Ridge Apartments LLC v. Naumann - filed December 17, 2007, Fourth District, Div. One
     Cite as 2007 SOS 7331
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