Redondo Beach Waterfront v. City of Redondo Beach CA2/3 ( 2022 )

Filed 12/21/22 Redondo Beach Waterfront v. City of Redondo Beach CA2/3
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION THREE
REDONDO BEACH B311039
WATERFRONT, LLC,
Los Angeles County
Plaintiff and Appellant, Super. Ct. No. BC682833
v.
CITY OF REDONDO BEACH,
Defendant and Respondent.
APPEAL from an order of the Superior Court of Los
Angeles County, Teresa A. Beaudet, Judge. Affirmed.
Shumener, Odson & Oh, Betty M. Shumener, John D.
Spurling, and Daniel E. French for Plaintiff and Appellant.
Office of the City Attorney for the City of Redondo Beach,
Michael W. Webb and Cheryl Yeun Shin Park; Mintz Levin Cohn
Ferris Glovsky and Popeo, Jonathan Welner, Antony D. Nash,
Nada I. Shamonki, and Kathryn L. Ignash for Defendant and
Respondent.
_______________________________________
INTRODUCTION
This is the second appeal in this lawsuit between Redondo
Beach Waterfront, LLC (RBW or the developer) and the City of
Redondo Beach (City) arising out of a dispute over a proposed
development project (Project) for the City’s Redondo Beach King
Harbor Pier area (Waterfront).
In this case’s first appeal, Redondo Beach Waterfront, LLC
v. City of Redondo Beach (Apr. 27, 2020, B292007 [nonpub. opn.])
(Redondo I), we partially reversed the trial court’s order denying
the City’s special motion to strike RBW’s complaint under Code of
Civil Procedure section 425.16 (anti-SLAPP statute or Section
425.16). We concluded that two of the complaint’s allegations
targeted the City’s protected activities—(1) the City’s submission
of a local voter initiative to the California Coastal Commission
(Coastal Commission) for its review and certification; and (2) the
participation of three conflicted City officials in decisions
affecting RBW’s interests in the Project. We remanded the matter
for the court to determine in the first instance whether RBW
demonstrated any of its claims based on the City’s protected
activities have minimal merit.
In this appeal, RBW challenges the court’s order granting
in part and denying in part the City’s anti-SLAPP motion issued
after our decision in Redondo I. Specifically, RBW contends the
court erred in finding the developer failed to show it was likely to
prevail on its substantive due process and breach of contract
claims arising out of the City’s submission of the local voter
initiative to the Coastal Commission. We affirm.
2
FACTUAL BACKGROUND
1. The Project
The City has long wanted to revitalize the Waterfront, an
area popular for its restaurants, shops, and other seaside
attractions. In 2010, the City’s residents passed Measure G,
authorizing the City to renovate 150,000 square feet of existing
building area and create 400,000 square feet of new development
in the Waterfront area. The Coastal Commission later certified
Measure G, amending the City’s local coastal program (LCP) to
permit new development in the Waterfront area.
Because the City couldn’t fund the new development on its
own, it formed a public-private partnership with RBW’s
predecessor-in-interest. In 2013, RBW and the City executed
various agreements to facilitate RBW’s development of the
Project. RBW then invested more than $15 million to develop a
plan for the Project, which included the construction and
renovation of more than 500,000 square feet of retail space,
restaurants, cinemas, hotels, parking lots, a public boat ramp, a
seaside lagoon, and other facilities.
In June 2016, RBW sought approval of the Project,
including approval of a vesting tentative tract map. On June 23,
2016, the City notified RBW that its application for approval of
vesting tentative tract map was “deemed complete.”
In August 2016, the Harbor Commission approved several
entitlements for the Project, including an environmental impact
report (EIR), a coastal development permit, a conditional use
permit, a Harbor Commission design review, and the vesting
tentative tact map. In October 2016, following an appeal of the
Harbor Commission’s decision, the Redondo Beach City Council
(City Council) passed a resolution approving RBW’s entitlements
3
for the project. The resolution noted that the City’s approval of
the vesting tentative tract map “shall confer a vested right to
proceed with development in substantial compliance with the
ordinances, policies, and standards described in Section 66474.2
of the Government Code of the State.”
2. The Agreement for Lease of Property and
Infrastructure Financing (ALPIF)
As of January 2017, the Project was moving forward as
planned. That month, the City and RBW executed the ALPIF,
which, among other things, merged the parties’ prior agreements
and identified specific parcels of land that the City was required
to lease to RBW. In exchange, RBW would construct and renovate
certain infrastructure within the Waterfront area.
The first paragraph of Section 303 of the ALPIF requires
the City to work “cooperatively” with RBW “to assist in
coordinating the expeditious processing and consideration of all
necessary permits, entitlements, and approvals.” That same
paragraph provides that the “City shall … retain complete
discretion to amend the general plan, zoning or other land use
designations or requirements applicable to the Waterfront Project
Site,” except that such amendments “shall not modify any
obligations the City may have under existing laws with respect to
vested rights for the Waterfront Project.”
The second paragraph of Section 303 states that “[i]n no
event shall … [the] City’s amendment of the general plan, zoning
or other land use designations applicable to the Lease Parcels,
Seaside Lagoon or Developer Improvements, be deemed a breach
or Default of” the ALPIF.
Section 706 of the ALPIF states that the agreement does
not constitute a “ ‘development agreement’ as defined in
4
Government Code section 65864, et seq.,” nor does the agreement
“grant any vested rights to [RBW] or provide any assurance to
[RBW] that upon approval of the [Project], [RBW] may proceed
with the [Project] in accordance with existing policies, rules and
regulations, and conditions of approval.” Instead, the ALPIF
“provides that [the Project] will be required to comply with any
applicable rules, regulations and policies governing permitted
uses of the land, density, design, improvement and construction
standards and specifications applicable to [the project], whether
or not in conflict with rules, regulations or policies existing as of
the date of this Agreement, except as [RBW] may already have
obtained vested rights to develop [the Project] in accordance with
the existing general plan, zoning, vesting tentative tract map, or
other land use designations or requirements currently applicable
to the [Project].”
3. Measure C
In June 2016, while RBW was securing its entitlements,
some City residents and others opposed to the Project submitted
a “Notice of Intent to Circulate Petition” to the City, seeking to
place a local initiative—the King Harbor Coastal Access,
Revitalization, and Enhancement Act (Measure C)—on the ballot
for the next general municipal election. In December 2016, after
proponents gained sufficient signatures, Measure C was placed
on the ballot for the City’s March 2017 election.
The argument in favor of Measure C was prepared by a
group called Rescue Our Waterfront and was signed by City
Councilmember Bill Brand, and future Councilmembers Todd
Loewenstein and Nils Nehrenheim. According to Rescue Our
Waterfront, Measure C would stop construction of “a waterfront
mall adding 13,136 daily car trips and doubling development.”
5
Opponents of Measure C argued it would result in City taxpayers
themselves paying for the necessary repairs to the waterfront
area. The City Attorney’s analysis that accompanied the ballot
materials cautioned that Measure C, if approved, would not
necessarily prevent the planned Project from going forward.
In March 2017, the City’s voters passed Measure C. Section
2(A)(4) of Measure C states that the “additions to the Zoning
Ordinance for the Coastal Zone” contained in the initiative “are
not intended to authorize and do not authorize the use of any
parcel of land other than a use that is designated in the city’s
certified LCP as a permitted use of the parcel.” Section 8 of
Measure C provides in relevant part: “If a majority of Redondo
Beach voters vote in favor of this Act, its provisions shall apply to
any project concerning which development rights have not vested
as of the date the initiative petition that contains this Act was
found to have qualified for placement on the ballot.”
During the same election in which Measure C passed,
Brand was elected as the City’s mayor and Loewenstein was
elected to a seat on the City Council. Nehrenheim, who faced a
runoff election, was elected to a seat on the City Council later
that year. All three candidates had run on an “anti-Waterfront
[Project] platform.”
In April 2017, the City notified RBW that the passage of
Measure C triggered the ALPIF’s force majeure clause1 and, as a
1 The force majeure clause appears in Section 702 of the ALPIF. That
clause provides in relevant part: “In addition to specific provisions of
this Agreement, performance by either Party hereunder shall not be
deemed to be in Default, and all performance and other dates specified
in this Agreement shall be extended, where delays or Defaults are due
to causes beyond the control or without the fault of the Party claiming
an extension of time to perform, which may include, without
6
result, the City’s performance concerning the Project would be
delayed. The City explained that it was unknown whether the
Coastal Commission would certify or modify Measure C and, if so,
what effect the initiative would have on the City’s ability to
perform under the ALPIF. According to the City, its performance
of “certain obligations under the ALPIF with respect to the
design, approval and construction of a boat ramp” may be
“delayed or prevented as a result of the passage of Measure C and
the need for final Coastal Commission approvals … .”
In May 2017, the City Council discussed passing a
resolution sending Measure C to the Coastal Commission for
certification. At that meeting, Mayor Brand “suggested adding a
section to the [r]esolution stating ‘City Council hereby requests
that the California Coastal Commission hear and consider the
amendments of Measure C before considering any other coastal
development permits.’ ”
The City Council voted to pass the resolution sending
Measure C to the Coastal Commission for certification. The
Resolution stated Measure C amended two sections of the City’s
Municipal Code, which had previously been certified by the
Coastal Commission as part of the City’s LCP. The Resolution
further stated that because the City was required by law to
submit to the Coastal Commission any proposed amendments to
that plan, the City was sending Measure C to the Commission.
limitation, the following: … delays caused by litigation, initiative or
referendum; … [or] acts or failures to act of any other public or
governmental agency or entity (other than the acts or failures to act of
City which shall not excuse performance by City).”
7
Mayor Brand’s suggested language was not included in the
version of the resolution that the City Council passed.
4. RBW’s Petition for Writ of Mandate and Redondo
Beach Waterfront, LLC v. City of Redondo Beach (2020)
51 Cal.App.5th 982 (Redondo II)
In early 2017, RBW filed a petition for writ of mandate and
complaint for declaratory and injunctive relief against the City,
asserting that Measure C is invalid and unconstitutional and, in
any event, is inapplicable to the Project. Relevant here, RBW’s
request for declaratory relief sought an order for, among other
things, a declaration that Measure C could not be applied
retroactively to the project because RBW’s statutory rights under
Government Code section 66498.1 had vested prior to the
initiative’s passage. A group of residents opposed to the project
intervened in the lawsuit to represent the interests of Measure
C’s proponents. The parties and the court agreed to resolve the
question of Measure C’s impact on RBW’s statutory vested rights
as a matter of law, through a motion for judgment on the
pleadings filed by RBW.
After hearing oral argument, the court ruled on the motion
for judgment on the pleadings. At the threshold, the court found
the matter was ripe for declaratory relief. Specifically, the court
found the City took at least two steps to apply Measure C in a
manner adverse to RBW’s vested rights by: (1) notifying RBW
that Measure C triggered the ALPIF’s force majeure clause; and
(2) later terminating the ALPIF.
The court then found RBW obtained statutory vested rights
against the City, entitling the developer to proceed with the
Project in accordance with its vesting tentative tract map. Under
Government Code section 66498.1, the court explained, RBW’s
8
rights would have vested when the city approved or conditionally
approved a vesting tentative tract map. Since the City deemed
RBW’s vesting tentative tract map complete in June 2016 and the
City Council approved the map by resolution in October 2016, all
of which occurred before voters passed Measure C in March 2017,
the court found RBW’s rights vested before Measure C was
passed. Consequently, the court concluded, the City couldn’t
apply Measure C against RBW with respect to the Project. The
court entered judgment in favor of RBW, and the intervening
residents appealed.
In Redondo II, we affirmed the court’s judgment. We held
that under the plain language of Government Code section
66498.1, RBW’s “right to proceed with the [Waterfront] Project
vested as to the City on June 23, 2016, well before City residents
passed Measure C in March 2017.” (Redondo II, supra, 51
Cal.App.5th at p. 994.) Thus, we concluded, once RBW’s rights
vested, the City was “prohibited from applying subsequently
amended local ordinances, standards, and policies—such as the
amended ordinances contained in Measure C—to the
[Waterfront] Project.” (Id. at p. 998.) We noted, however, that
under Government Code section 66498.6, subdivision (b), RBW’s
vested rights did not curtail “either the applicability of the
Coastal Act or the oversight provided by the Coastal
Commission” because courts “have consistently recognized the
supremacy of the Coastal Act over matters of local concern.”
(Redondo II, at p. 998.)
5. RBW’s Federal Lawsuit
In June 2017, RBW sued the City in federal court, alleging
the City deprived RBW of due process, violated the contracts
9
clause of the federal Constitution, and breached the ALPIF. RBW
also sought declaratory relief against the City.
In August 2017, the City sent RBW a letter claiming the
developer breached the ALPIF’s forum selection clause by filing a
complaint against the City in federal court. Several days later,
the City accused RBW of repudiating a reimbursement
agreement between the parties.
In October 2017, the City sent RBW a “Notice of
Termination,” stating the City was terminating the ALPIF based
on the developer’s alleged breaches of that agreement, including
the developer’s filing a lawsuit against the City in federal court.
RBW’s federal lawsuit was dismissed in January 2018.
6. The Current Lawsuit
In December 2017, RBW filed a complaint against the City
in state court, alleging the City breached the ALPIF. RBW
alleged it had invested more than $15 million to develop the
Project before the City terminated the ALPIF based on pretextual
breaches by RBW. The complaint asserted four causes of action
against the City: (1) deprivation of substantive due process rights
under 42 U.S.C. section 1983 (Section 1983); (2) deprivation of
procedural due process rights under Section 1983; (3) breach of
contract; and (4) declaratory relief.
RBW alleged the City breached the ALPIF and violated the
developer’s due process rights by engaging in the following
conduct: “(1) failing to protect, and indeed jeopardizing, [RBW’s]
property and contractual rights, permits, and Vesting Tentative
Tract Map and/or to ensure that it would be able to perform its
own obligations under the ALPIF: (2) seeking out a new
development partner when the City is obligated to lease portions
of the Waterfront to [RBW] under the ALPIF; (3) seeking to
10
redesign the Waterfront Project to the exclusion of [RBW]; (4)
allowing officials who have a clear conflict of interest to continue
to make decisions and/or participate in decisions or conduct that
affect the ALPIF and [RBW’s] rights thereunder; (5) refusing to
allow [RBW] access to records as required under Section 207 of
the ALPIF; (6) failing to submit the complete application for the
required boat ramp … to the Coastal Commission within 90 days
after the effective date of the ALPIF; (7) using the
Reimbursement Agreement, which has been superseded by the
ALPIF and is ‘of no further force and effect’, to manufacture a
breach; (8) using the filing of the Federal Complaint to
manufacture defaults under the ALPIF; and (9) declaring a
forfeiture/termination of the ALPIF when it had no right to do
so.”
7. The City’s Anti-SLAPP Motion
The City filed an anti-SLAPP motion, arguing RBW’s
complaint targeted the City’s protected activity. The motion
challenged only four of the breaches and violations alleged in
RBW’s complaint: (1) the City’s failure to protect RBW’s vested
rights, including the City’s passage of Measure C and submission
of the initiative to the Coastal Commission; (2) communicating
with a new partner to develop the Waterfront area; (3) seeking a
redesign of the development for the Waterfront area; and (4)
allowing conflicted City officials to participate in decisions
affecting the ALPIF. As to the merits of RBW’s claims, the City
argued, among other things, that the developer could not prevail
on its breach of contract cause of action based on the City’s
submission of Measure C to the Coastal Commission because
Section 303 of “the ALPIF states that the City has full authority
to amend the land use regulations governing the [Project] and
11
that no such change to the land use regulations shall constitute a
breach of contract.”
RBW opposed the City’s motion, arguing, among other
things, the City’s conduct was not “SLAPPable” because “the
collective action of a government entity” is not entitled to
protection under the anti-SLAPP statute. Acknowledging some
courts have held government conduct may in some instances
constitute protected activity, RBW asserted the City’s conduct
giving rise to the developer’s lawsuit was neither “speech” nor
“expressive activity,” but rather “breaches of the ALPIF and
violations of Gov. Code § 66498.1.” Specifically, RBW argued “it is
not the City’s ‘petitioning’ or ‘campaigning’ for Measure C that
gives rise to [RBW’s] claims—it is the City’s attempts to deprive
[RBW] of its contractual and vested rights, such as attempting to
retroactively apply Measure C to [RBW] in violation of
Government Code section 66498.1 … .”
The court denied the City’s anti-SLAPP motion in its
entirety. The court found the City’s passing of a resolution to
submit Measure C to the Coastal Commission for review and
certification was not protected activity. According to the court,
“[t]he City passing a resolution is not conduct arising from
protected activity” because “ ‘[a]cts of governance mandated by
law, without more, are not exercises of free speech or petition.’ ”
As for the City allowing conflicted officials to participate in
decisions affecting the ALPIF, the court found such conduct was
not protected by the anti-SLAPP statute because RBW’s
allegations didn’t implicate any conduct by the City, as opposed
to the City’s individual councilmembers. At most, the court
reasoned, the conduct underlying RBW’s allegations was
“basically any official decision made by the City involving the
12
ALPIF, which … does not implicate protected activity.” The court
also found the remaining alleged breaches of the ALPIF and
violations of RBW’s due process rights were not protected activity
under the anti-SLAPP statute. The court did not address whether
RBW demonstrated a probability of prevailing on the merits of
any of its claims.
The City appealed.
8. Redondo I
In Redondo I, we affirmed in part and reversed in part the
court’s order denying the City’s anti-SLAPP motion. Specifically,
we reversed the court’s order to the extent it found the City’s
submission of Measure C to the Coastal Commission and the
participation of conflicted City officials in decisions affecting the
ALPIF did not constitute protected activity.
As to the City’s submission of Measure C to the Coastal
Commission, we concluded such conduct was “petitioning”
activity that is protected by the anti-SLAPP statute. We
explained that “[s]ending Measure C to the Coastal Commission
furthered the City’s right to petition because the City sought
administrative action, namely to have the Commission certify the
proposed amendments to the City’s coastal plan.” Since the
“development of the City’s waterfront area had been an ongoing
subject of public debate, discussion, and controversy for several
years,” we held the City’s submission of Measure C to the Coastal
Commission concerned a public issue under the anti-SLAPP
statute.
We also held the participation of conflicted City officials in
decisions affecting the ALPIF was protected activity. Specifically,
the acts of City officials in drafting Measure C and campaigning
on anti-Project platforms were protected as written or oral
13
statements or writings made before a legislative proceeding
under subdivision (e)(1) of the anti-SLAPP statute. Finally, we
held the City’s communications with new development partners
and its attempts to redesign the development of the Waterfront
area was not protected by the anti-SLAPP statute because such
conduct did not form the basis of RBW’s alleged injuries.
We remanded the matter with directions for the court to
consider in the first instance whether RBW had demonstrated a
reasonable probability of prevailing on its causes of action arising
out of the City submitting Measure C to the Coastal Commission
and allowing conflicted officials to participate in decisions
affecting the ALPIF.
9. Proceedings on Remand from Redondo I
After we remanded the matter, the court allowed the
parties to submit supplemental briefs addressing whether there
was a reasonable probability RBW could prevail on its claims
arising out of the City’s protected activities. Both parties
submitted briefs.
RBW argued that once the City agreed its obligations under
the ALPIF were subject to RBW’s vested rights, the City accepted
the risk that subsequent changes to local land use ordinances—
such as Measure C—would defeat its performance under the
ALPIF. RBW also argued it was likely to prevail on its due
process claims because the City allowed conflicted officials who
ran on anti-Waterfront Project platforms to make decisions that
adversely affected RBW’s statutory vested rights and contractual
rights under the ALPIF.
The City argued the passage of Measure C and its decision
to submit the initiative to the Coastal Commission for review and
certification did not breach the ALPIF. According to the City, it
14
was obligated by law to submit the initiative to the Coastal
Commission and, once it did so, it was up to the Coastal
Commission to determine whether the initiative could be applied
to the Project.
As for RBW’s claims arising out of the participation of
conflicted City officials in decisions adversely affecting the
developer’s vested rights and contractual interests, the City
argued the developer submitted no evidence to establish any of
the City’s officials had a qualifying conflict of interest.
The court granted the City’s anti-SLAPP motion in part
and denied it part. The court found RBW was not likely to prevail
on any of its claims arising out of the allegation that the City
improperly sought to retroactively apply Measure C to the Project
through its submission of the initiative to the Coastal
Commission. As for RBW’s allegation that the City allowed
conflicted officials to participate in decisions affecting RBW’s
interests under the ALPIF, the court found RBW was reasonably
likely to prevail on its procedural due process and declaratory
relief claims, but not its claim for breach of contract.
Addressing the City’s submission of Measure C to the
Coastal Commission, the court explained that such conduct could
not support RBW’s breach of contract or due process claims
because the City’s conduct was obligatory under Public Resources
Code2 section 30514, which requires municipalities to submit
“[a]ny proposed amendments to a certified local coastal program,”
such as an initiative like Measure C, to the Commission for
review and certification. (§ 30514, subd. (a).) The court also
2All undesignated statutory references are to the Public Resources
Code.
15
rejected RBW’s contention that once the City entered the ALPIF,
“the City accepted the risk that [a] subsequent change in the law
(such as Measure C) would defeat its performance under” that
agreement. The court explained: “RBW’s vested rights as to the
City do not preclude the Coastal Commission from regulating the
Waterfront Project. As set forth [in Redondo II], the Coastal
Commission ‘has the ultimate authority to ensure that coastal
development conforms to the policies embodied in the state’s
Coastal Act.’ [Citation.] Thus, ‘the vested statutory rights flowing
from a local agency’s approval of a vesting tentative map bind the
local agency—not the state.’ [Citation.] Based on this, it cannot
be concluded as a matter of law that the City’s agreement that it
was subject to RBW’s vested rights means that it was accepting
the risk of a performance-defeating change in the law when
neither ‘the applicability of the Coastal Act [nor] the oversight
provided by the Coastal Commission is curtailed by RBW’s vested
rights.’ ”
RBW appeals.
DISCUSSION
RBW contends the court erred when it granted the City’s
anti-SLAPP motion challenging the developer’s allegations that
the City breached the ALPIF and violated the developer’s
substantive due process rights when it submitted Measure C to
the Coastal Commission for certification. We disagree.
RBW concedes the City was authorized to enact Measure C
and that the City was required to submit the initiative to the
Coastal Commission for that agency’s review under the Coastal
Act of 1976 (Act) (§ 30000 et seq.). Thus, according to RBW, none
of its claims arise out of either of those acts. Instead, RBW
asserts it is the City’s request that the Coastal Commission
16
“certify” Measure C that constitutes a breach of the ALPIF and a
violation of the developer’s substantive due process rights.
According to RBW, such conduct was wrongful because it
amounted to the City “petitioning a state agency to amend [the
City’s] LCP to kill [the] Project.”
As we explain, nothing in the ALPIF prohibited the City
from asking the Coastal Commission to certify Measure C. Thus,
RBW cannot show such conduct constituted a breach of that
agreement. Likewise, the City’s request that the Coastal
Commission certify the initiative did not violate RBW’s
substantive due process rights because it was neither arbitrary
nor irrational, and RBW has not shown it resulted in a
deprivation of any protected rights. Rather, the City’s submission
of Measure C to the Coastal Commission was an exercise of the
City’s authority to regulate local land use pursuant to the wishes
of the City’s electorate. The court, therefore, properly found RBW
was not reasonably likely to prevail on any of its claims arising
out of the City’s submission of Measure C to the Coastal
Commission.3
1. General Principles of the Anti-SLAPP Statute
Under the anti-SLAPP statute, a defendant may move to
strike claims “ ‘arising from any act … in furtherance of the
[defendant’s] right of petition or free speech under the United
States Constitution or the California Constitution in connection
with a public issue.’ ” (Wilson v. Cable News Network, Inc. (2019)
3 RBW does not dispute that the court’s finding that the developer’s
claim for declaratory relief arising out of the City’s submission of
Measure C to the Coastal Commission rises and falls with its
substantive due process and breach of contract claims.
17
7 Cal.5th 871, 884.) Section 425.16 does not completely insulate a
defendant’s protected speech but instead provides a mechanism
“for weeding out, at an early stage, meritless claims arising from”
protected activity. (Baral v. Schnitt (2016) 1 Cal.5th 376, 384
(Baral).)
Courts apply a two-prong test when evaluating an anti-
SLAPP motion. (Baral, supra, 1 Cal.5th at p. 384.) Under the
first prong, the defendant must establish that the challenged
claim arises from activity protected by Section 425.16. (Baral, at
p. 384) If the defendant establishes the plaintiff’s claims arise out
of protected activity, the burden shifts to the plaintiff at the
second prong to demonstrate a probability of prevailing on its
claims. (Ibid.)
At the second prong, the plaintiff must make a prima
showing of facts to sustain a favorable judgment. (Wong v. Jing
(2010) 189 Cal.App.4th 1354, 1368.) The court conducts an
analysis akin to evaluating a summary judgment motion. (Baral,
supra, 1 Cal.5th at p. 384.) “The court does not weigh evidence or
resolve conflicting factual claims. Its inquiry is limited to
whether the plaintiff has stated a legally sufficient claim and
made a prima facie factual showing sufficient to sustain a
favorable judgment. [The court] accepts the plaintiff’s evidence as
true, and evaluates the defendant’s showing only to determine if
it defeats the plaintiff’s claim as a matter of law.” (Id. at pp. 384–
385.) If the plaintiff makes a prima facie showing of a likelihood
of success, the court should deny the anti-SLAPP motion unless,
as a matter of law, the defendant’s evidence defeats the plaintiff’s
claim. (Wong, at p. 1368.)
18
We independently review whether a plaintiff demonstrated
its claims have minimal merit under the anti-SLAPP statute.
(Paulus v. Bob Lynch Ford, Inc. (2006) 139 Cal.App.4th 659, 672.)
2. The Coastal Act and the Amendment of Local Land Use
Ordinances in Coastal Zones
Before addressing the merits of RBW’s claims, we provide a
brief overview of the procedure a local government must follow
when enacting and amending local land use laws governing land
falling within the State’s coastal zone.
The Act is a “comprehensive scheme [governing] land use
planning for the entire coastal zone of California.” (Yost v.
Thomas (1984) 36 Cal.3d 561, 565 (Yost).) Relevant here, the Act
establishes the procedure through which LCPs are prepared,
adopted, certified, amended, and periodically reviewed. (Security
National Guaranty, Inc. v. California Coastal Commission (2008)
159 Cal.App.4th 402, 419–420 (Security National).) An LCP
includes, among other things, a local government’s land use
plans, zoning ordinances, and zoning district maps for areas
falling within the coastal zone. (§ 30108.6.)
Under the Act, any local government whose land lies
partially or entirely within the coastal zone, like the City, must
prepare an LCP. (Yost, supra, 36 Cal.3d at p. 566; § 30500, subd.
(a).) “The precise content of each [LCP] shall be determined by
the local government … in full consultation with the commission
and with full public participation.” (§ 30500, subd. (c).) Once it
has created a proposed LCP, “the local government must then
submit [it] to the [Coastal] Commission for certification.”
(Security National, supra, 159 Cal.App.4th at p. 420; § 30512.)
The Coastal Commission must review a proposed LCP to
determine whether it complies with the policies and
19
requirements of the Act. (§ 30512, subds. (a) & (c).) If the
proposed LCP complies with the Act, the Coastal Commission
must certify it. (Id., subd. (c).) In reviewing a proposed LCP, the
Coastal Commission is prohibited from “diminish[ing] or
abridg[ing] the authority of the local government to adopt and
establish, by ordinance, the precise content of its land use plan.”
(§ 30512.2, subd. (a).) In other words, “ ‘the Commission in
approving or disapproving an LCP does not create or originate
any land use rules and regulations. It can approve or disapprove
but it cannot itself draft any part of the coastal plan.’ ” (Yost,
supra, 36 Cal.3d at p. 572.)
The Act establishes a similar procedure for amending a
local government’s LCP and other land use laws governing land
in the coastal zone. (Security National, supra, 159 Cal.App.4th at
p. 422.) Specifically, section 30514, subdivision (a) provides: “A
certified local coastal program and all local implementing
ordinances, regulations, and other actions may be amended by
the appropriate local government, but no such amendment shall
take effect until it has been certified by the commission.” All
proposed amendments must be submitted to, and processed by,
the Coastal Commission under similar procedures governing the
review and certification of a proposed LCP. (Id., subd. (b).) The
Act defines an “ ‘amendment of a certified local coastal program’ ”
as including, but not limited to, “any action by a local government
that authorizes the use of a parcel of land other than a use that is
designated in the certified local costal program as a permitted
use of the parcel.” (Id., subd. (e).)
In short, a local government must submit a proposed LCP,
and any new ordinances that may amend an existing LCP or
existing local implementing ordinances, regulations, and other
20
actions, to the Coastal Commission for review and certification.
(§§ 30500 & 30514.)
3. The City’s submission of Measure C to the Coastal
Commission does not support a claim for breach of
contract.
To prevail on a claim for breach of contract, the plaintiff
must prove: (1) the existence of a contract; (2) the plaintiff’s
performance, or excuse for nonperformance, under the contract;
(3) the defendant’s breach of the contract; and (4) the plaintiff’s
damages flowing from the defendant’s breach. (Oasis West Realty,
LLC v. Goldman (2011) 51 Cal.4th 811, 821.) As we explain, the
court properly found RBW was not likely to prevail on its claim
for breach of contract arising out of the City’s submission of
Measure C to the Coastal Commission because nothing in the
ALPIF precluded the City’s conduct.
RBW points to no language in the ALPIF that expressly
bars the City from asking the Coastal Commission to “certify” an
ordinance that could affect the Project. Indeed, such language
appears nowhere in the parties’ agreement. That is not
surprising because the second paragraph of Section 303 of the
ALPIF expressly states that “[i]n no event” shall the City be
liable for a breach of the agreement based on its “amendment of
the general plan, zoning or other land use designations applicable
to the Lease Parcels, Seaside Lagoon or the Developer
Improvements [i.e., the Project].” In other words, under the
express terms of the ALPIF, the City is permitted to amend its
land use laws that apply to the Project, such as through the
amendments included in Measure C.
For the same reason, the City was permitted to submit
Measure C to the Coastal Commission for review and possible
21
certification. As we noted above, RBW does not dispute that the
City could enact Measure C and was “required” to submit the
initiative to the Coastal Commission “so that the agency could
evaluate” it. Indeed, as we explained above, the Act requires a
local government to submit to the Coastal Commission for review
and certification any proposed amendments to a “certified local
coastal program and all local implementing ordinances,
regulations, and other actions.” (§ 30514, subd. (a).) Under the
terms of the Act, an amendment to an LCP cannot go into effect
until the Coastal Commission “certifie[s]” it or, following an
expedited procedure, determines that the amendment is “minor”
or “de minimis.” (§ 30514.) Accordingly, as part of the statutorily
prescribed process for amending land use laws that fall within
the coastal zone, the City was required to submit Measure C to
the Coastal Commission. Thus, under Section 303 of the ALPIF,
the City was allowed to submit Measure C to the Coastal
Commission for review and possible certification.
RBW contends the City nevertheless breached the ALPIF
when it asked the Coastal Commission to “certify” Measure C, as
opposed to asking the agency to “review” or “evaluate” the
initiative to determine whether it constituted an “amendment” to
the City’s LCP requiring certification. This argument lacks merit.
RBW cites no authority establishing that a request for the
Coastal Commission to certify, as opposed to a request for the
agency to review or evaluate, a proposed land use amendment
carries any legal significance. That is, RBW points to no case law
or statute that says the Coastal Commission must treat
differently a local government’s request for certification of a
proposed land use amendment versus a request for review or
evaluation of a proposed land use amendment. In any event, even
22
if a request for certification of a proposed land use amendment
was legally significant, such a request would be permitted under
Section 303 of the ALPIF, as that provision authorizes the City to
amend its land use laws applicable to the Project without
limitation on the nature of the amendment.
RBW next contends that the City’s request that the Coastal
Commission certify Measure C violates the spirit of other
provisions of the ALPIF. We disagree.
According to RBW, the City’s efforts to certify Measure C
run afoul of a clause in the first paragraph of Section 303 that
requires City staff to “work cooperatively with [RBW] to assist in
coordinating the expeditious process and consideration of all
necessary permits, entitlements, and approvals.” Specifically,
RBW asserts “the City sought amendment of the LCP so that
RBW would not be able to obtain its permits to complete the
Project. Because RBW’s vested rights bound the City, but not
[the] Coastal [Commission], having [that agency] certify Measure
C ensured that the Project could not move forward despite RBW’s
vested rights.” (Emphasis in original.) But, as the trial court
found, the City Council’s resolution sending Measure C to the
Coastal Commission did not mention any permits pending before
that agency, nor did the resolution ask the agency to apply
Measure C to stop or otherwise hinder the Project.4 Thus, the
4 As we noted above, Mayor Brand proposed adding language to the
resolution asking the Coastal Commission to wait to consider “any
other coastal development permits” until after it reviewed Measure C.
But, in the end, that language was not included in the resolution
sending Measure C to the Coastal Commission. Thus, Mayor Brand’s
proposed language does not support a claim that the City’s submission
of Measure C to the Coastal Commission breached the ALPIF.
23
City’s submission of Measure C to the Coastal Commission for
review and certification, by itself, does not support a claim that
the City violated the cooperation clause of Section 303.
RBW also relies on language in Section 706 that requires
RBW to comply with any land use related rules, regulations, or
policies affecting the Project, regardless of whether those rules,
regulations, or policies were in effect at the time the parties
signed the ALPIF, “except as [RBW] may already have obtained
vested rights to develop the [Project] in accordance with existing
general plan, zoning, vesting tentative tract map, or other land
use designations or requirements currently applicable to the
Lease Parcels and Seaside Lagoon.” In RBW’s view, Section 706
bars the City from asking the Coastal Commission to certify
Measure C. We are not persuaded.
It is clear from the title and content of Section 706 that the
provision defines the nature of the ALPIF. The title of Section
706 is: “Not a Development Agreement.” The first sentence of
that provision (which RBW does not address) explains that the
ALPIF is not a development agreement under Government Code
section 65865 that would, by its terms alone, grant RBW
contractually enforceable vested rights to proceed with the
Project under the City’s land use laws existing at the time of the
agreement’s execution. (See Mammoth Lakes Land Acquisition,
LLC v. Town of Mammoth Lakes (2010) 191 Cal.App.4th 435,
442–444 (Mammoth Lakes) [a development agreement executed
under Government Code section 65865 is enforceable despite
subsequent changes to a municipality’s land use laws].) The
second sentence of that provision states that the ALPIF does not
grant RBW any vested rights or provide RBW “any assurance to
the [developer] that upon approval of the [Project], the
24
[developer] may proceed with the [Project] in accordance with
existing policies, rules and regulations, and conditions of
approval.” And the fourth (and final) sentence of Section 706
states that “the Parties agree that this Agreement is not a
development agreement as defined in Government Code Section
65865, et seq.”
To be sure, the third sentence of the provision
acknowledges that RBW does not have to comply with any local
land use laws that went into effect after RBW obtained statutory
vested rights in the Project. But nothing in Section 706 precludes
the City from amending its own land use laws, including asking
the Coastal Commission to certify any amendments to the City’s
laws. Indeed, such language would conflict with the second
paragraph of Section 303.
At the very least, RBW contends, the City’s request that
the Coastal Commission certify Measure C violates the ALPIF’s
implied covenant of good faith and fair dealing. Under California
law, each contract includes an implied covenant of good faith and
fair dealing that prevents one of the parties from engaging in
conduct that frustrates the other parties’ rights to the benefits of
the contract. (Cobb v. Ironwood Country Club (2015) 233
Cal.App.4th 960, 965–966.) “A party violates the covenant if it
subjectively lacks belief in the validity of its act or if its conduct is
objectively unreasonable.” (Carma Developers (Cal.), Inc. v.
Marathon Development California, Inc. (1992) 2 Cal.4th 342,
372.) “[T]he scope of conduct prohibited by the covenant of good
faith is circumscribed by the purposes and express terms of the
contract.” (Id. at p. 373.) Where the challenged conduct is “within
the bounds of the contract’s express terms,” it does not violate the
implied covenant of good faith and fair dealing. (Id. at pp. 373–
25
374 [“it was certainly within the reasonable expectations of the
parties” that the defendant might engage in conduct expressly
permitted by the parties’ agreement].)
As we explained above, Section 303 of the ALPIF expressly
permits the City to amend its land use laws applicable to the
Project. Because the City was required under the Act to submit
Measure C to the Coastal Commission for the agency’s review
and possible certification, its request that the Coastal
Commission certify Measure C does not violate the ALPIF’s
implied covenant of good faith and fair dealing. In other words,
any effort by the City to amend its LCP and other land use laws
applicable to the Project is within the parties’ reasonable
expectations based on the express terms of the ALPIF.
Finally, RBW argues this case is analogous to Mammoth
Lakes. There, a developer and the Town of Mammoth Lakes
(Town) entered into a development agreement under Government
Code section 65865, subdivision (a) to improve the Town’s airport
and to build a hotel or condominium project at the airport.
(Mammoth Lakes, supra, 191 Cal.App.4th at pp. 440, 444–447.)
The Town later decided it did not want to proceed with the
project as planned in the development agreement and sought the
assistance of the Federal Aviation Administration (FAA) to “ ‘get
rid of’ ” the proposed condominium or hotel project. (Id. at p. 449.)
After discussions with Town officials, the FAA objected to the
project and threatened to cut off the Town’s federal funding for
the airport. (Id. at pp. 449–450.) Although the developer
demanded the Town move forward with the project as originally
planned, the Town refused to complete the project unless the
parties resolved the FAA’s objections. (Id. at pp. 450–451.) A jury
26
found the Town breached the development agreement and
awarded the developer $30 million in damages. (Id. at p. 453.)
The Court of Appeal affirmed the jury’s verdict. (Mammoth
Lakes, supra, 191 Cal.App.4th at p. 477.) The court’s decision
turned on the fact that the parties had entered into a
development agreement as defined in Government Code section
65865. (Mammoth Lakes, at pp. 442–444, 466–468.) As the court
explained, “[a] development agreement is a statutorily-authorized
agreement between a municipal government (here, the Town)
and a property owner for the development of the property,” which
freezes “the municipality’s rules, regulations, and policies
governing permitted uses of land and density of the land use, as
well as standards and specifications for design improvement, and
construction.” (Id. at p. 442.) Thus, once the development
agreement is approved by ordinance, it is “enforceable despite
subsequent changes in the municipality’s land use laws.” (Id. at
p. 443.) Because the Town refused to perform its contractual
obligations without the parties’ completion of a condition not
contemplated by the development agreement, the Town breached
that agreement. (Id. at pp. 466–468.)
RBW’s reliance on Mammoth Lakes is misplaced because,
as we just explained, the ALPIF expressly states that it is not a
development agreement under Government Code section 65865.
Unlike the agreement at issue in Mammoth Lakes, the ALPIF
does not, through its execution alone, grant RBW any
contractually enforceable vested rights in the Project. The
holding in Mammoth Lakes, therefore, does not apply here.
In short, the court did not err when it found RBW was not
likely to prevail on its claim for breach of contract based on the
City’s submission of Measure C to the Coastal Commission.
27
4. The City’s submission of Measure C to the Coastal
Commission does not support a substantive due
process claim.
RBW also contends the court erred when it found the
developer was not likely to prevail on its claim that the City’s
submission of Measure C to the Coastal Commission violated the
developer’s substantive due process rights. We are not persuaded.
“Substantive due process protects against arbitrary
government action.” (Las Lomas Land Co., LLC v. City of Los
Angeles (2009) 177 Cal.App.4th 837, 855 (Las Lomas).) To prevail
on a substantive due process claim under Section 1983, the
plaintiff must establish: (1) it had a “valid property interest
within the meaning of the [United States] Constitution”; and (2)
the government’s conduct implicating that property interest was
arbitrary or irrational. (Clark v. City of Hermosa Beach (1996) 48
Cal.App.4th 1152, 1184 (Clark).)
Here, RBW contends, and the court found, that RBW’s
statutory vested rights in the Project are constitutionally
protected. Assuming RBW and the court are correct, RBW
nevertheless cannot prevail on its substantive due process claim
because nothing in the record supports a finding that the City’s
submission of Measure C to the Coastal Commission was
arbitrary or irrational. (Clark, supra, 48 Cal.App.4th at p. 1184.)
It is well-established that “ ‘[r]ejections of development
projects and refusals to issue building permits do not ordinarily
implicate substantive due process.’ ” (Clark, supra, 48
Cal.App.4th at p. 1184, quoting PFZ Properties, Inc. v. Rodriguez
(1st Cir. 1991) 928 F.2d 28, 31; see also Las Lomas, supra, 177
Cal.App.4th at p. 856 [“Typical land use disputes involving
alleged procedural irregularities, violations of state law, and
28
unfairness ordinarily do not implicate substantive due process.”].)
“ ‘The doctrine of substantive due process “does not protect
individuals from all [governmental] actions that infringe liberty
or injure property in violation of some law. Rather, substantive
due process prevents ‘governmental power from being used for
purposes of oppression,’ or ‘abuse of governmental power that
shocks the conscience, or ‘action that is legally irrational in that
it is not sufficiently keyed to any legitimate state interests.’ ”
[Citations.]’ ” (Stubblefield Construction Co. v. City of San
Bernardino (1995) 32 Cal.App.4th 687, 709–710 (Stubblefield).)
Thus, to satisfy the second prong of a substantive due
process claim, the challenged government action must amount to
“some form of outrageous or egregious conduct constituting ‘a
true abuse of power.’ ” (Las Lomas, supra, 177 Cal.App.4th at p.
856.) The plaintiff must show more than an intentional or
reckless abuse of government power. (Clark, supra, 48
Cal.App.4th at p. 1185.) Instead, “ ‘the plaintiff must
demonstrate a degree of outrageousness and a magnitude of
potential or actual harm that is truly conscience shocking.’ ”
(Ibid.)
In Stubblefield, our colleagues in Division Two of the
Fourth District held that a city council’s decision to block a
development project on facts similar to those here did not support
a substantive due process claim. (Stubblefield, supra, 32
Cal.App.4th at pp. 708–712.) In that case, a developer sought to
build an apartment complex on 600 acres of land. (Id. at p. 696.)
The developer agreed to allow the city to annex the property in
exchange for the city’s promise that it would provide the
necessary zoning for the project. (Ibid.) Later, the city proposed a
zoning ordinance that would adversely affect the project if the
29
ordinance was applied to it. (Id. at p. 697.) After the city
promised the developer that the new ordinance wouldn’t be
applied to the project, a council member who vigorously opposed
the project sponsored an urgency ordinance that defeated the
city’s assurance. (Id. at pp. 697–698.) Following passage of the
urgency ordinance, the city council killed the project. (Id. at p.
700.)
In concluding the city council’s conduct did not violate the
developer’s substantive due process rights, the court in
Stubblefield explained, “the record demonstrates actions of the
City Council that responded to concerns of constituents in the
affected area and other political concerns. Specifically, the
[council member’s] alleged vendetta … against the project has not
been shown to be an arbitrary and irrational action as a matter of
substantive due process. It is not uncommon or unusual for a
legislator to oppose a project and to use all means within his or
her power to defeat it. After all, a legislator is supposed to
respond to the concerns of his or her constituents, and there is
ample evidence in the record here that persons living in the
vicinity of the project were concerned about it. Whether the
concerns were proper or justified is not the issue here. The point
is that their elected representative decided to oppose the project,
and did so vigorously.” (Stubblefield, supra, 32 Cal.App.4th at pp.
710–711.)
In Breneric Associates v. City of Del Mar (1998) 69
Cal.App.4th 166, the reviewing court held that allegations that
city council members acted out of personal animosity toward a
developer when they blocked a proposed project were insufficient
to support a substantive due process claim. (Id. at pp. 184–186.)
The court explained that a government official’s motivation for
30
voting on land use issues is irrelevant to determining whether
there has been a due process violation. (Id. at p. 184, citing
Landgate, Inc v. California Coastal Com. (1998) 17 Cal.4th 1006,
1022 [“The proper inquiry is not into the subjective motive of the
government agency, but whether there is, objectively, sufficient
connection between the land use regulation in question and a
legitimate governmental purpose so that the former may be said
to substantially advance the latter.”].) Similarly, in Las Lomas,
this division held that a council member’s vigorous opposition to
a proposed project and misleading public statements about the
project did not support a substantive due process claim because
such conduct, if proven, was not “an outrageous or egregious
abuse of power of constitutional dimension.” (Las Lomas, supra,
177 Cal.App.4th at p. 857.)
The City’s submission of Measure C to the Coastal
Commission did not violate RBW’s substantive due process
rights. As a threshold matter, the City was required under the
Act to submit Measure C to the Coastal Commission once voters
passed the initiative. (See § 30514, subd. (a).) Thus, the City’s act
was neither irrational nor arbitrary—it was mandated by law.
Even if we were to assume it was improper for the City to
ask the Coastal Commission to “certify” Measure C, as opposed to
simply submitting the initiative to the agency for review, the
City’s conduct was not egregious, oppressive, or conscience
shocking. (Clark, supra, 48 Cal.App.4th at p. 1185.) Measure C
was passed by a majority of voters who participated in the City’s
March 2017 election. Measure C’s proponents advocated for the
initiative on an anti-Project platform. That is, the official
arguments in favor of Measure C claimed the initiative could
stop, or at least reduce the scope of, the Project. In other words, it
31
is clear that at least some of the City’s electorate who voted for
Measure C opposed the Project. Thus, even if we were to assume
the City intended to hinder the Project by submitting Measure C
to the Coastal Commission, such conduct was done in furtherance
of the concerns of the City’s constituents. As the court in
Stubblefield explained, even if the concerns of a city’s electorate
are not “proper or justified,” those concerns are “ ‘an appropriate
factor for consideration in zoning decisions’ ” when evaluating a
substantive due process claim. (Stubblefield, supra, 32
Cal.App.4th at p. 711.)
In short, the court properly found RBW was not likely to
prevail on its substantive due process claim arising out of the
City’s submission of Measure C to the Coastal Commission.
32
DISPOSITION
The order granting in part and denying in part the City’s
anti-SLAPP motion is affirmed. The City shall recover its costs on
appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
LAVIN, J.
WE CONCUR:
EDMON, P. J.
EGERTON, J.
33