Court of Appeal Rules that Denial of a Landowner's Application to Develop Property Can Be a Compensable Regulatory Taking
By Michael Hansen and Keith Garner
The Fourth Appellate District recently held that a local agency's denial of an application to develop a 2.85 acre parcel in the middle of a developed residential area can constitute a compensable regulatory taking under the Penn Central Transp. Co. v. City of New York (1978) 438 U.S. 104 ("Penn Central") case. Continue Reading Questions & comments
Ashley Joffe v. City of Huntington Park, No. B222880 (Cal Ct. App. 2d Dist., November 11, 2011)
By Michael Hansen
The Second Appellate District recently held that public statements and other actions indicating an intent to condemn must clearly meet the criteria set out in the landmark California Supreme Court decision Klopping v. City of Whittier (1972) 8 Cal.3d 39 (Klopping) in order for inverse condemnation liability to arise. In 1972, the California Supreme Court, in Klopping, held that a valid claim for inverse condemnation could be based on governmental actions preceding an actual, or even a de facto, taking of property. The plaintiffs Ashley Joffe and Plycraft Industries owned a furniture manufacturing business at a location where the defendants City of Huntington Park and a developer expressed intent to acquire and develop a proposed retail project. Plaintiffs alleged that the City's announced intent to condemn made it impossible to enter into long-term furniture contracts and consequently forced Plycraft out of business at that location. The property was never acquired by the defendants, and the plaintiffs filed a claim for inverse condemnation under Klopping.
Plaintiffs claimed recovery for unreasonable delay because (1) the actions of the defendants, including erecting large signs announcing the project and stating that plaintiffs' property would be acquired either voluntarily or involuntarily, were sufficient to constitute an "announcement of intent to condemn," under Klopping; or (2) the City acted unreasonably; or (3) the actions of the City constituted equitable or promissory estoppel. The City successfully demurred to these allegations because they were not sufficient to satisfy the requirement of Klopping that there be an "announcement of intent to condemn." Plaintiffs appealed and the Second Appellate District affirmed.
William Bookout v. State of California ex rel. Department of Transportation, 2d Civil No. B214906 (2nd Dist., June 28, 2010).
By Michael Wilmar and Alex Merritt
In William Bookout v. State of California ex rel. Department of Transportation, the Second District Court of Appeal provided important guidance on whether an inverse condemnation action is subject to a three-year or five-year statute of limitations, and whether annual flooding constitutes a continuous or permanent nuisance.
Regulatory Takings Law: Ninth Circuit Panel Holds A Mobile Home Rent Control Ordinance Is Subject To A "Facial Challenge" And Awards Compensation To Property Owners
Guggenheim v. City of Goleta (9th Circuit, No. 06-56306, 9/28/2009).
By Dave Lanferman and Deborah Rosenthal
According to a panel of the federal Ninth Circuit Court of Appeal, the City of Goleta owes compensation to mobile home park owners for economic losses resulting from the enactment of a mobile home rent control ordinance. In Guggenheim v. City of Goleta, the panel held that, on its face, the rent control ordinance effectuated a “naked transfer” of approximately 90% of the value of the property from the park owner to the tenants. The court declared that “a facial challenge [to an ordinance] exists as a viable legal claim” under the ad hoc, multi-factor standards first described by the U. S. Supreme Court in 1978, in Penn Central v. City of New York (1978) (438 U.S. 104). Based on the unusual circumstances of this case, the court addressed the merits of the claim and found that this severe loss of value was a compensable regulatory “taking,” even though the park owners continued to earn positive annual returns.
In Monks, the California Court of Appeal found the City of Ranch Palos Verdes (City) had exacted a permanent taking on a group of land owners seeking to build homes on 16 lots in the Palos Verdes coastal peninsula area by establishing insurmountable conditions for development without a valid justification. Since the City could not justify the development conditions under state principles of property or nuisance law, the City was found to have violated the takings clause under California’s Constitution, which states: “Private property may be taken or damaged for public use only when just compensation … has first been paid to…the owner.” Cal. Const., art. I, § 19.Continue Reading Questions & comments
Action Apartment Association v. City of Santa Monica (August 28, 2008, Case No. B201176) __ Cal.App. 4th __
Plaintiff Action Apartment Association (“Action”) argued that an ordinance passed by Defendant City of Santa Monica (“City”), on its face, violated the takings clause of the Fifth Amendment of the United States Constitution and article I, section 19 of the California Constitution. Action also argued that the ordinance was an amendment to the city’s housing element and thus required approval by the Department of Housing and Community Development (“DHCD”). The Court of Appeal affirmed the trial court ruling that the Nollan/Dolan test does not apply to a facial challenge of a land use regulation. The Court further affirmed that the City’s affordable housing ordinance is not a housing element, does not amend the City’s housing element and thus does not require review by the DHCD.Continue Reading Questions & comments
Sea Walls Can Be Expensive: $2 Million Mitigation Fee for Loss of Shoreline Recreational Value is Not a Taking
Ocean Harbor House Homeowners Association v. California Coastal Commission (May 23, 2008, H031129) 163 Cal.App.4th 215.
A $2 million mitigation fee based on the present value of lost present and future public shoreline recreational values and imposed by the California Coastal Commission as a condition to the issuance of a development permit for the construction of a sea wall to prevent shoreline erosion is not an unconstitutional taking.Continue Reading Questions & comments
By James Rusk
The Court of Federal Claims this month awarded more than $4.2 million to the estate of Wayne and Jean Hage as compensation for the federal government’s taking of the Hages’ water rights and rangeland improvements. Hage v. United States, No. 91-1470L (Fed. Cl. June 6, 2008). Hage V, the latest chapter in the long-running Hage case, affirms the principle that private parties do not have a compensable property interest in federal grazing permits. But the decision nonetheless recognizes that government actions distinct from the cancellation of grazing permits may, under some circumstances, effect a Fifth Amendment taking of an individual’s vested right to water flowing from federal lands.Continue Reading Questions & comments
Ripeness Doctrine And Futility Exception Both Require Submission And Denial of a "Meaningful Application"
In County of Alameda v. Superior Court, 133 Cal. App. 4th 558 (2005), the California Court of Appeal, First District, ruled that a developer seeking to bring an inverse condemnation action may not invoke the futility exception to the ripeness doctrine until the developer has submitted a development proposal to land use authorities and had it denied.Continue Reading Questions & comments