September 2020 Update
This update addresses the most significant cases and statutory changes since the previous update was published, and adds numerous practice tips and expert commentary. Among the most significant recent developments and additions are the following:
REMINDER: The California Supreme Court approved comprehensive revisions, including renumbering, of the California Rules of Professional Conduct, which took effect November 1, 2018. All cites to those Rules have been updated to refer to the new numbering. See §§1.2, 1.16D, 1.18, 1.24–1.27, 9.64.
Dozens of new practice tips, helpful notes, and expert comments have been included in this update. See §§2.11, 4.8, 4.60, 4.71, 4.80, 5.11, 5.15–5.16, 5.28, 6.4, 7.4, 7.17, 8.27A, 9.49, 9.64–9.65, 9.75, 9.93–9.94, 10.30I, 13.7C, 14.6A, 14.13, 15.5, 15.19.
A new section discussing the comparability of sales, and the admissibility of evidence regarding comparable sales, has been added to chapter 4. See §4.31A.
In Thee Aguila, Inc. v Century Law Group, LLP (2019) 37 CA5th 22, a landlord unsuccessfully claimed the right to the tenant’s award for loss of goodwill based on a lease clause that stated “all awards for the taking of any part of the Premises” shall be the property of the landlord, including leasehold value. The court ruled there was no assignment of the claim of tenant’s loss of goodwill to the landlord under the lease, and allowed the tenant to recover its loss. See §§4.68, 10.3.
In Ruiz v County of San Diego (2020) 47 CAth 504 (a flood damage case), the county was not liable for the failure of a privately installed pipe within a natural water course that also carries public waters, after the county had specifically rejected an offer of dedication and had not exercised control over or assumed maintenance of the pipe. See §§6.4, 6.7, 13.3B, 14.5, 14.6B.
Effective January 1, 2020, AB 116 (Stats 2019, ch 656) amended Govt C §§53398.66 and 53398.69 regarding the procedures for adopting a resolution proposing an infrastructure financing plan and the issuance of bonds to finance such a plan. See §6.6 (noting other recent legislative measures regarding redevelopment).
Chapter 12 (Income Tax Consequences of Condemnation Awards) has been updated to reflect the Tax Cuts and Jobs Act (Pub L 115–97), enacted in 2017, and includes numerous other updating revisions.
The U.S. Supreme Court denied a petition for certiorari (No. 17-1198, Oct. 1, 2018) in the Surfrider Found. v Martins Beach 1, LLC case; however, litigation regarding access to Martin’s Beach continues. See Note in §15.20.
In City of Oroville v Superior Court (2019) 7 C5th 1091, the California Supreme Court emphasized that the preferred standard for determining cause in inverse cases is “substantial causation” rather than “proximate causation.” In the Oroville case, the city was not liable for damage to private property when the owner had failed to install a required backflow valve on its lateral line that may have eliminated or mitigated sewage damage from a backup in the public line. See §13.3D, 13.7A, 13.7C, 14.3, 14.6A.
The liability of private utility companies whose equipment caused wildfires was recognized under California law in In re PG&E Corp. (Bankr ND CA 2019) 611 BR 110. See §§13.4, 13.6, 14.13A.
In Weiss v People ex rel Dep’t of Transp. (review granted June 13, 2018, S248141; superseded opinion at 20 CA5th 1156), the court ruled that a CCP §1260.040 motion does not authorize a pretrial determination of liability; such a determination is beyond the scope of the statute, which is limited to resolving issues arising out of exchange of valuation data. See §§9.49, 17.8. As of June 30, 2020, the Supreme Court had not yet issued its decision in this case.
In a 5–4 decision issued on June 21, 2019, Knick v Township of Scott (2019) __ US __, 139 S Ct 2162, the U.S. Supreme Court overruled the state-litigation requirement of Williamson County. See §§15.3, 15.5, 15.8–15.9, 15.19, 16.11–16.12, 16.15, 17.3. For further discussion of Knick, see California Land Use Practice §§17.42, 17.44 (Cal CEB).
In a takings challenge to a state land use commission’s reversion order effectively downzoning the plaintiff’s 1060-acre property (a lava field) from urban use to agricultural use, the Ninth Circuit overturned a jury verdict of liability under Penn Central and Lucas, based on trial testimony that reverting urban zoning for development of the lava field to a holding zone of agriculture caused an 83.4 percent loss of value. See Bridge Aina Le'a, LLC v Hawaii Land Use Comm’n (2020) (9th Cir 2020) 950 F3d 610, discussed in §§15.7, 15.10–15.12, 15.14.
In York v City of Los Angeles (2019) 33 CA5th 1178, the city had approved a permit to build a large home, guest house, and recreation area on the owner’s parcel, but failed to grant a grading permit that greatly exceeded (by 24 times) the amount of cubic yards allowed by right for a residential development. That failure did not deprive the owner of all economic viable use of the property, because the denial did not limit the owner to the grading ordinance’s standard and did not prohibit a more modest development proposal. See §15.9.
When a special condition was imposed on approval for residential development of a bluff-top ocean lot, prohibiting the owner from ever constructing any bluff or shoreline protective devices, the court in Lindstrom v California Coastal Comm’n (2019) 40 CA5th 73 ruled that there was no categorical taking of all economic use, because the condition is not an intrusion on the land; the owner can still build a house; and, if the bluff erodes over time, that would be by a force of nature and not government action. See §§15.20, 15.27.
In Tanimura & Antle Fresh Foods, Inc. v Salinas Union High Sch. Dist. (2019) 34 CA5th 775, a school district’s imposition of school impact fees on a new residential development project intended to house adult seasonal farmworkers was upheld on the ground that the Mitigation Fee Act (Govt C §§66000–66003) does not require a school district to separately analyze the impact of a unique type of residential construction not contemplated in the statutory scheme. See §15.24.
In Pakdel v City & County of San Francisco (9th Cir 2020) 952 F3d 1157, the Ninth Circuit denied the property owner the opportunity to pursue a takings challenge to a condominium conversion condition that it offer existing tenants a life-time lease, when the owner did not timely seek an exemption from the requirement. See §§16.11–16.12.
The case of Tesoro Refining & Marketing Co. LLC v Los Angeles Reg’l Water Quality Control Bd. (2019) 42 CA5th 453 involved a dispute over the source of contamination of soils by petroleum hydrocarbons that were traced by the agency’s testing to discharge from gasoline pipelines next to an oil refinery. The court held that the litigation of those facts for the first time in court is precluded by administrative exhaustion, but ruled in favor of the company on the futility exception. See §16.13.