Lockaway Storage v. County of Alameda

Filed 5/9/13
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIRST APPELLATE DISTRICT
DIVISION THREE
LOCKAWAY STORAGE et al.,
Plaintiffs and Respondents,
A130874, A132768
v.
COUNTY OF ALAMEDA et al., (Alameda County
Super. Ct. No. HG 03 091201)
Defendants and Appellants.
I. INTRODUCTION
The County of Alameda (County) determined that an amendment to its General
Plan adopted by voters as Measure D prohibited Lockaway Storage et al., from
completing a project to develop a self-storage facility in the County. Lockaway sued for
inverse condemnation and civil rights violations. After issuing a writ of mandate that
authorized the project to proceed, the superior court conducted a nonjury trial which
resulted in a judgment holding the County liable for a temporary regulatory taking and
awarding Lockaway damages of $989,640.96. Pursuant to a separate order, the court
awarded Lockaway attorney fees totaling $728,015.50.
The County appeals both the judgment and the attorney fee order. It contends the
judgment must be reversed because (1) Lockaway‟s development plan violated Measure
D; and (2) even if the court correctly allowed Lockaway to proceed with the project, the
County‟s conduct did not effect a regulatory taking. The County also contends that if the
judgment is affirmed, the trial court erred by awarding Lockaway attorney fees for work
that was irrelevant or unnecessary to its inverse condemnation claim.
We conclude that the trial court was correct to rule that Lockaway‟s project was
unaffected by the passage of Measure D. The County‟s change of position, almost two
1
years after Measure D was implemented, was an unreasonable and unjust interpretation
of the measure that effectuated a regulatory taking. The basis for the award of attorney
fees is easily discerned from the record and was reasonably within the scope of the trial
court‟s discretion. Thus, we affirm.
II. STATEMENT OF FACTS
A. The Property
Lockaway‟s property is an 8.45-acre parcel of land in an unincorporated area of
Alameda County between Castro Valley and the City of Dublin. Located on the frontage
road to Interstate 580, the property was used by Caltrans during highway construction
and then for several years functioned as a public dump.
In 1989, the County Board of Supervisors approved an ordinance zoning the
property for “agricultural” use with an alternative conditional use for “open storage of
recreational vehicles and boats.” Over the next 10 years, the County approved several
Conditional Use Permits (CUP‟s) for vehicle storage on the property which expired
without development. In 1999, the County approved another CUP for the property
authorizing a storage facility for recreational vehicles and boats (the 1999 CUP). The
1999 CUP required that it be implemented within three years of issuance, or it would
terminate on September 22, 2002.
In May 2000, Lockaway entered into a contract to purchase the property for
$800,000. Lockaway, a general partnership that develops, owns and operates storage
facilities, intended to implement the 1999 CUP to develop a boat and RV self-storage
facility. Before Lockaway closed escrow, its general partner Michael Garrity met with
County Zoning Administrator Darryl Gray, who confirmed that the property could be
used as Lockaway intended. When escrow closed in August 2000, Lockaway assumed
the rights and obligations of the seller in the 1999 CUP.
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B. Measure D
In November 2000, Alameda County voters enacted Measure D, a growth control
initiative which became effective on December 22 of that year. Among other things,
Measure D generally prohibits the development of a storage facility in the area of
Lockaway‟s property, except by public vote. Furthermore, Section 19, subdivision (c) of
the measure states in part: “Except as required by state law, no subdivision map,
development agreement, development plan, use permit, variance or any other
discretionary administrative or quasi-administrative action which is inconsistent with this
ordinance may be granted, approved, or taken.”
Notwithstanding Section 19, two other sections of Measure D limit its application.
One is Section 3, titled “Protection of Legal Rights,” which states: “Notwithstanding
their literal terms, the provisions of this ordinance do not apply to the extent, but only to
the extent, that courts determine that if they were applied they would deprive any person
of constitutional or statutory rights or privileges, or otherwise be inconsistent with the
United States or State constitutions or law. The purpose of this provision is to make
certain that this ordinance does not violate any person‟s constitutional or legal rights.
[¶] To the extent that a provision or provisions of this ordinance do not apply because of
this section, then only the minimum development required by law which is most
consistent with the provisions and purposes of this ordinance shall be permitted.”
The other is Section 22, titled “Application,” which provides: “(a) This ordinance
does not affect existing parcels, development, structures, and uses that are legal at the
time it becomes effective. However, structures may not be enlarged or altered and uses
expanded or changed inconsistent with this ordinance, except as authorized by State law.
[¶] (b) Except to the extent there is a legal right to development, the restrictions and
requirements imposed by this ordinance shall apply to development or proposed
development which has not received all necessary discretionary County and other
approvals and permits prior to the effective date of the ordinance.”
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C. The Lockaway Project
Even after Measure D became effective, Lockaway pursued its plan to develop the
property and continued its dialogue with County Administrator Gray and other members
of County staff. Gray testified at trial that he never told any Lockaway representative
that Measure D‟s use restrictions applied to the Lockaway project. By the end of 2000,
Lockaway had expended approximately $70,000 on project consultants and architects.
In February 2002, Lockaway applied for a grading permit. The County deemed
the application incomplete and specified additional requirements and fees. Lockaway
went to work to meet the County‟s requirements.
In July 2002, Lockaway project manager David Michael and construction manager
Gary Brown met with Phil Kubicek from the County‟s planning department. Gray
participated in the meeting by telephone. During the meeting, both Gray and Kubicek
acknowledged that Lockaway had already implemented the 1999 CUP. Gray also said
that if the grading and building permits were not issued by the CUP‟s September 22
expiration date, he would prepare a formal letter stating that the CUP had been
implemented. At trial, Gray denied making these assurances. However, the trial court
expressly found that Gray‟s testimony “in this regard, like his testimony on several other
material points, lacks credibility.”
On August 30, 2002, Gray informed Michael that unless Lockaway obtained a new
CUP, it could not proceed with its project after the 1999 CUP terminated on September
22. That same day, Michael prepared a written request for an extension of the 1999 CUP
and personally delivered it to Gray and other County staff associated with the project.
His request referenced Gray‟s assurances during their July 2002 meeting. In response,
Lockaway was informed it could not renew its permit, but had to apply for a new one.
By that time, Lockaway had spent approximately $400,000 on its project, in addition to
the property‟s $800,000 purchase price.
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D. Lockaway’s Application for a New CUP
Lockaway applied for the new CUP under protest on September 3, 2002. On
September 19, the County issued a grading permit. But the County did not issue a
building permit for the project prior to the September 22, 2002, termination date of the
1999 CUP.
The Castro Valley Municipal Advisory Council (Advisory Council) conducted a
hearing on September 23, 2002, to consider Lockaway‟s application for the new CUP.
Both Gray and County Counsel Lorenzo Chambliss expressed the opinion that the
Lockaway project was prohibited under Measure D. The County took the position that
Measure D applied to the project because Lockaway had not obtained a building permit
and commenced construction prior to Measure D‟s December 22, 2000, effective date.
No mention was made of the possible effect of either Sections 19 or 22 on Lockaway‟s
right to proceed with the project.
Lockaway argued that its right to complete the project was unaffected by Measure
D because the 1999 CUP was implemented before it expired. To support this contention,
Lockaway relied on evidence demonstrating the substantial work it had done on the
project and on Gray‟s assurances that the 1999 CUP had been implemented. Several
members of the Advisory Council expressed concern that the County had mishandled the
project and that it would be unfair to deny Lockaway‟s application even though it
conflicted with Measure D.1 Ultimately, the Advisory Council voted 5-to-1 to
recommend approval of Lockaway‟s application for a new CUP.
On October 9, 2002, the West County Board of Zoning Adjustments considered
the Advisory Council recommendation at a hearing. The County‟s position remained that
Lockaway‟s application should be denied pursuant to Measure D because Lockaway had
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For example, when County counsel told the Advisory Council that in order to
“survive” Measure D, a project had to have all of its permits before the measure went into
effect, the Chair responded that if County staff “had proceeded in a timely manner and
advised applicant the Council would not be having this discussion tonight. Without the
delays the applicant would not be here tonight.”
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not obtained a building permit and commenced construction prior to December 22, 2000.
The Board of Zoning Adjustment rejected the Advisory Council‟s recommendation and
denied Lockaway‟s application for a new CUP on the ground that it was inconsistent with
the County‟s general plan as amended by Measure D.
On March 6, 2003, the County Board of Supervisors heard Lockaway‟s appeal of
the Board of Zoning Adjustment‟s decision. The Board of Supervisors determined that
the Lockaway project was subject to Measure D and affirmed the Board of Zoning
Adjustment‟s decision to deny Lockaway‟s application for a new CUP. Thereafter, the
County stopped the work on the project.
E. The Present Action
On April 4, 2003, Lockaway filed its complaint against the County and others
alleging causes of action for inverse condemnation and civil rights violations seeking
damages, a writ of mandate and other equitable relief.
1. Pretrial Proceedings
Lockaway‟s seventh cause of action sought a writ of mandate commanding the
County to recognize that the 1999 CUP had vested, to recognize that Measure D did not
apply to its project, and to allow construction of the project to proceed. The parties
agreed this cause of action would be decided on cross-motions for summary adjudication
pursuant to their stipulation of undisputed facts.
The motions were considered in November 2004. The County argued that the
Lockaway project could not proceed because the 1999 CUP was issued pursuant to a
zoning provision which was superseded by Measure D. According to the County, when
Measure D took effect in December 2000, the zoning ordinance became ineffective and
the 1999 CUP issued pursuant to that ordinance was also ineffective. Lockaway argued
that its project was exempt from Measure D under Section 22 of the ordinance which
states that it does “not affect existing parcels, development, structures, and uses that are
legal at the time it becomes effective,” and that the “restrictions and requirements
imposed by this ordinance shall apply to development or proposed development which
has not received all necessary discretionary County and other approvals and permits”
6
prior to the effective date of the measure. Lockaway argued that this “grandfather
clause” applied to its project because it had obtained all necessary discretionary approvals
from the County prior to Measure D‟s effective date.
On November 24, 2004, the superior court granted summary adjudication on the
mandate cause of action in Lockaway‟s favor. The court found that Measure D did not
apply to the Lockaway project because the undisputed facts established that the project
was “squarely under the protections of Section 22 of Measure D.” In reaching this
conclusion, the court observed that, although the County had not yet issued Lockaway a
building permit, the County conceded a building permit was ministerial. The court
rejected the County‟s argument that Measure D voided both the 1999 CUP and the
zoning ordinance pursuant to which that CUP was issued. The court determined that the
County‟s argument was inconsistent with both the purpose of a grandfather clause and
the plain language of Section 22.
On February 14, 2005, the superior court filed an order for issuance of a writ of
mandate commanding the County to “recognize [the 1999 CUP] as a valid conditional
use permit which is vested in Petitioners and to allow construction to proceed on
Petitioners‟ property pursuant to said conditional use permit . . . .” The writ issued on
February 28, 2005.
Initially, the County resisted complying with the writ and Lockaway initiated a
contempt proceeding. In August 2005, the County issued the necessary permits so that
Lockaway could complete its project.
During the lengthy pretrial period that followed, Lockaway settled its claims
against the individual defendants in this case. Lockaway‟s remaining claims against the
County were temporally divided into three “phases” consisting of Phase I claims arising
prior to September 22, 2002, based on alleged delays during the permitting process;
Phase II claims arising between September 22, 2002, and April 15, 2005, based on the
County‟s application of Measure D to the Lockaway project; and Phase III claims arising
after April 15, 2005, based on alleged delays in compliance with the writ of mandate.
The parties settled the Phase I and Phase III claims prior to trial. Thus, the claims that
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were considered at trial pertained exclusively to the period between September 22, 2002,
and April 15, 2005, when the County prohibited work on the Lockaway project pursuant
to Measure D.
2. Trial
Lockaway‟s damages claims against the County were tried in March 2009. The
trial court issued its posttrial findings, conclusions and order on September 22. In its
September 2009 order, the court found that the County‟s possible liability turned on the
answers to two questions: “(1) Did Defendant‟s conduct amount to a temporary „taking‟
under the Fifth Amendment to the US Constitution thereby requiring that Plaintiffs be
compensated? (2) Did Defendant‟s conduct violate Plaintiffs‟ substantive due process
rights?”
To answer the first question, the trial court applied a test articulated by the
Supreme Court of the United States in Penn Central Transp. Co. v. New York City (1978)
438 U.S. 104, 115-116 (Penn Central). Pursuant to that “Penn Central inquiry,” the trial
court found that the County‟s application of Measure D was a temporary regulatory
taking making it liable in damages to Lockaway on its cause of action for inverse
condemnation. The trial court supported its conclusion with extensive findings of fact
including that the County‟s regulatory action had a “substantial, negative economic
impact” on Lockaway‟s use of the property, had “materially interfered with Plaintiffs‟
distinct, investment-backed expectations,” and that its conduct could not be justified as a
normal regulatory mistake.
However, the trial court also rejected Lockaway‟s due process claim. The court
reasoned that while the County‟s conduct was outside the realm of an inadvertent error or
honest mistake, the County had not “deliberately flouted the law and trammeled
significant property rights, thereby violating the substantive due process rights of
Plaintiffs.”
The damages phase was tried in April 2010. On September 14, 2010, the trial
court filed its findings which awarded Lockaway $504,175 in lost profits, and $324,954
in increased construction costs due to the 30-month delay in construction during the
8
Phase II period. With the addition of prejudgment interest, Lockaway‟s damages on its
inverse condemnation cause of action totaled $989,640.96.
3. Judgment and Attorney Fees
On November 15, 2010, the court filed a statement of decision which incorporated
the September 2009 order on liability, and the September 2010 order on damages.
Judgment was entered that same day.
Lockaway moved for its attorney fees pursuant to Code of Civil Procedure section
1036 (section 1036). Lockaway requested a lodestar award of $703,760 plus a 1.25
multiplier for a total award of $879,700. The trial court awarded Lockaway $703,760
(i.e., the lodestar amount without a multiplier), plus $24,255.50 for work on the attorney
fee motion for a total award of $728,015.50.
III. DISCUSSION
A. Measure D
The County first claims that the trial court incorrectly interpreted and applied
Measure D. According to the County, Measure D prohibited Lockaway from completing
its project and the trial court was wrong to conclude that the project was exempted from
Measure D‟s restrictions by Section 22. The County contends that this legal error
undermines both the writ of mandate and the judgment for damages. Lockaway counters
that any dispute regarding the propriety of the writ of mandate is moot and that, in any
event, the trial court correctly interpreted and applied Section 22.
We will first address mootness and then consider whether the court‟s conclusion
that the Lockaway project was exempt from the use restrictions of Measure D was
correct.
1. The Writ of Mandate
When the trial court issued the writ of mandate directing the County to allow
Lockaway to proceed with its project, the County did not seek a stay or any other
extraordinary relief to maintain the status quo. Instead, it issued permits to allow the
project to proceed, and Lockaway completed its project. Indeed, the County
acknowledges that Lockaway “is now operating its facility,” and it has been “open to the
9
public for years.” Notwithstanding these undisputed facts, the County asks this court to
reverse the writ of mandate. As we will explain, settled principles establish that the writ
petition is no longer a justiciable controversy and, therefore, the County‟s purported
appeal from the writ of mandate is moot.
“California courts will decide only justiciable controversies. [Citations.] The
concept of justiciability is a tenet of common law jurisprudence and embodies „[t]he
principle that courts will not entertain an action which is not founded on an actual
controversy . . . .‟ [Citations.] Justiciability thus „involves the intertwined criteria of
ripeness and standing. A controversy is “ripe” when it has reached, but has not passed,
the point that the facts have sufficiently congealed to permit an intelligent and useful
decision to be made.‟ [Citation.] But „ripeness is not a static state‟ [citation], and a case
that presents a true controversy at its inception becomes moot „ “if before decision it has,
through act of the parties or other cause, occurring after the commencement of the action,
lost that essential character.” ‟ ” (Wilson & Wilson v. City Council of Redwood City
(2011) 191 Cal. App. 4th 1559, 1573 (Wilson).)
“The pivotal question in determining if a case is moot is therefore whether the
court can grant the plaintiff any effectual relief. [Citations.] If events have made such
relief impracticable, the controversy has become „overripe‟ and is therefore moot.”
(Wilson, supra, 191 Cal.App.4th at p. 1574.) By the same token, an appeal is moot if
“ „the occurrence of events renders it impossible for the appellate court to grant appellant
any effective relief.‟ ” (Santa Monica Baykeeper v. City of Malibu (2011) 193
Cal. App. 4th 1538, 1547 (Baykeeper).)
Applying these principles, we hold that the County‟s appeal from the writ of
mandate is moot because the County has already fully complied with the writ and
Lockaway has completed its project. Under these circumstances, we cannot provide any
effective relief from the order commanding the County to allow the Lockaway project to
proceed. Two recent decisions support our conclusion. (Wilson, supra, 191 Cal. App. 4th
1559; Baykeeper, supra, 193 Cal.App.4th at p. 1547.)
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In each case, a project was completed in spite of legal challenges. Wilson, supra,
191 Cal. App. 4th 1559, was an action for declaratory relief. Baykeeper, supra, 193
Cal. App. 4th 1538, was a mandate action challenging the approval of a project and
environmental impact report. In both cases, completion of the projects during contested
litigation rendered it moot. The County contends the cases are inapposite because in each
of them, the plaintiff was seeking to stop a project, while here, the plaintiff Lockaway
was seeking to complete one. We fail to see why such a distinction makes any difference
to a proper mootness analysis. Lockaway‟s project is completed, and the County, as the
project challenger, can obtain no effective relief on the writ.
The County argues that effective relief can indeed be entered in mandamus
because Lockaway can always be forced to tear the project down. In so arguing, the
County relies upon Woodward Park Homeowners Assn. v. Garreks, Inc. (2000) 77
Cal. App. 4th 880. But there, a project was completed in the face of uncertainty created by
the litigation over whether the lead government agency needed to prepare an
environmental impact report. Rejecting arguments that the case was moot because the
project was completed, the appellate court concluded that sound conceptions of public
policy counseled against allowing a party to avoid the outcome of litigation by
proceeding with development in ongoing litigation that led to a court order directing
preparation of an environmental impact report. This case has no bearing on Lockaway‟s
situation. In Woodward Park the developer was not allowed to moot litigation by
completing a project in the face of legal challenges to its administrative approvals. Here,
Lockaway‟s project was completed because a court order allowed it to proceed. The
circumstances are starkly different, and there is no such public policy that warrants a
departure from application of the mootness doctrine.
Finally, the County contends that there is a “possibility of effective relief” even
though the project has been completed because “the award of damages is predicated on
the rulings on summary adjudication, meaning a material question remains to be
determined on appeal of the Writ.” Under this theory, reversal of the writ would grant
the County effective relief because it would undermine an essential premise of the
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judgment for damages. Therefore, the County posits, a “material question remains” as to
whether the County is liable for damages for a temporary taking.
This convoluted argument conflates mootness with one of three “discretionary”
exceptions to the mootness doctrine which enables a court to review an issue otherwise
moot “when a material question remains for the court‟s determination.” (Cucamongans
United for Reasonable Expansion v. City of Rancho Cucamonga (2000) 82 Cal. App. 4th
473, 480.) This discretionary exception does not support the County‟s position. First,
reversing the writ would not affect the County‟s liability for damages because the writ of
mandate did not award Lockaway damages; it commanded the County to issue permits
which have already been fully implemented. Relief from the damages award can be
obtained, if at all, by appealing the judgment.
Second, whether the County is liable for damages is not a “material question” that
remains for the court‟s determination. That question was answered by the trial court and
its conclusions are embodied in the judgment, not the writ. Of course, the County has
appealed from the judgment and, in the context of that appeal, we will review the trial
court‟s finding that Measure D use restrictions did not apply to the Lockaway project.
Thus, we are perplexed as to why the County has so aggressively sought reversal of the
writ. An appeal of the writ is moot.
2. The Section 22 Exemption
The superior court found that the Lockaway project was exempt from application
of Measure D pursuant to Section 22, which states in part: “[T]he restrictions and
requirements imposed by this ordinance shall apply to development or proposed
development which has not received all discretionary County and other approvals and
permits prior to the effective date of the ordinance.” The court found that Section 22
applied because Lockaway had received all discretionary approvals for its project before
Measure D‟s effective date.
The County contends this finding cannot be affirmed. To support its position, the
County proposes several interpretations of Section 22‟s exemption that would
significantly limit its scope. Alternatively, the County argues that, even if the trial court
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correctly interpreted the Section 22 exemption, that exemption did not apply to
Lockaway under the facts of this case.
a. The Scope of the Section 22 Exemption
The ordinary rules of statutory construction guide our effort to discern the meaning
of Section 22. (Lesher Communications, Inc. v. City of Walnut Creek (1990) 52 Cal. 3d
531, 540 (Lesher).) “Basic to all statutory construction . . . is ascertaining and
implementing the intent of the adopting body.” (Id. at p. 543; see also Save Our Sunol,
Inc. v. Mission Valley Rock Co. (2004) 124 Cal. App. 4th 276, 280 (Sunol) [“Our task
when interpreting an initiative is to effectuate the electorate‟s intent.”].) “Absent
ambiguity, we presume that the voters intend the meaning apparent on the face of an
initiative measure [citation] and the court may not add to the statute or rewrite it to
conform to an assumed intent that is not apparent in its language.” (Lesher, supra, 52
Cal.3d at p. 543.)
Our plain reading of Section 22 conveys the intent of the voters that certain
projects are unaffected by the measure‟s passage. Subdivision (a) clearly means that
legal uses at the time Measure D became effective remain legal, but may not be enlarged,
altered or expanded in a way that is contrary to Measure D unless authorized by state law.
Subdivision (b) means that projects that received all discretionary approvals prior to
Measure D‟s effective date have a legal right to development because it applies only to
those projects that have not received them. Together these subdivisions place two classes
of land use beyond Measure D‟s reach—those legally existing, and those in some stage of
development that had received all discretionary approvals before Measure D became
effective.
b. The County’s New Legal Theories
The County proposes several alternative interpretations of Section 22 that were not
raised in the trial court to support its decision to preclude Lockaway from completing its
project. We will assume, in order to dispose of them, that the County may advance these
brand new legal theories for the first time on appeal. Each of the County‟s alternatives
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would require us to interpret Measure D to mean something not apparent from its plain,
unambiguous language.
First, in accord with our plain reading of subdivision (a), the County recognizes
that Section 22 is a “grandfather clause” that recognizes the legality of certain approvals
that conflict with Measure D. By contrast, the County posits that subdivision (b) is not a
grandfather clause because it exempts nothing. It does not expressly exempt a project.
Instead, it describes one category of projects to which the restrictions do apply: those
projects that have not received all “discretionary County and other approvals and
permits.”
To indulge this proposed interpretation, we would be required to nullify or ignore
as surplus that part of subdivision (b) which is unfavorable to the County‟s position. The
first phrase of subdivision (b) recognizes there are projects that have acquired a legal
right to develop. The contours of that right turn on whether there are outstanding
discretionary approvals. The two subdivisions of Section 22 can and should be construed
together. By their plain language, they convey a single intention. Existing uses and
development, whether categorized as existing or proposed, are beyond Measure D‟s reach
if the developer acquired all discretionary permits from the County prior to its effective
date.
The County argues that construing subdivision (b) to grandfather all “development
or proposed development” that has received discretionary approval, would render
subdivision (a) meaningless and superfluous because there would be no reason for
subdivision (a) to exempt only “existing” parcels. Again, we disagree. Standing alone,
subdivision (a) exempts “existing” developments, without defining the word “existing.”
But any potential ambiguity due to such a lack of definition is avoided by taking into
account that subdivision (b) clarifies that any development, whether construed as
proposed or existing, is exempt from Measure D if all discretionary permits were
obtained before the measure‟s effective date. By acknowledging that subdivisions (a)
and (b) are part of the same section and reading them together, we give meaning to the
straightforward language in both subdivisions.
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The County also contends that the second sentence of subdivision (a) which
“explicitly states—without exception—that structures may not be „enlarged or altered‟
and that uses may not be „expanded or changed‟ inconsistent with Measure D,” conflicts
with the trial court‟s interpretation of subdivision (b). But the second sentence of
subdivision (a) does not address development at all. It addresses structures and existing
uses. Instead, development and proposed development are addressed in subdivision (b)
which clarifies the scope of authorized development, whether existing or proposed.
The County‟s second new theory is that, if subdivision (b) is a grandfather clause,
it establishes only a limited exemption. Comparing isolated phrases from Section 22, the
County suggests that subdivision (a) broadly exempts existing developments while
subdivision (b), exempts proposed developments only from the “the restrictions and
requirements” imposed by Measure D. According to the County, Measure D did more
than impose “restrictions and requirements,” it also made changes to the County‟s
general plan and zoning law which precluded the County from approving completion of
the Lockaway project. Therefore, the County argues that, “[t]echnically speaking, this
prohibition on the County‟s ability to approve further development of the Project was not
simply a „restriction‟ or „requirement‟ „imposed by‟ Measure D, but also was imposed by
state law, since it is state law (not just Measure D) which requires the County to comply
with its general plan and zoning ordinance.”
There are a couple of problems with this convoluted theory. As we have already
explained, subdivisions (a) and (b) are not two distinct rules. They are part of a single
provision which limits the measure‟s application. Second, the County‟s narrow
interpretation of the phrase “restrictions and requirements imposed by this ordinance” is
at best illogical and self-serving. If, as the County contends, the subdivision (b)
exemption from “restrictions and requirements imposed” by Measure D does not include
the changes to the County general plan and zoning ordinance effectuated by Measure D,
then subdivision (b) provides no exemption at all and the exception for a legal right to
development is meaningless.
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The County‟s third new theory is that, if subdivision (b) is a grandfather clause, it
applies only to proposed development that has obtained all approvals and permits from
the County before Measure D‟s effective date, including permits issued pursuant to
ministerial duties. Subdivision (b) provides that Measure D applies to proposed
development “which has not received all necessary discretionary County and other
approvals and permits” prior to its effective date. The County argues that this “plain
language” establishes that a proposed development is subject to Measure D when, as
here, the developer did not obtain all discretionary and ministerial permits before
Measure D went into effect.
This new twist on subdivision (b) is absurd. If, as the County now contends, the
drafters intended to exempt from its scope only those projects that had obtained all
County approvals and permits, they would have said so and not used the word
“discretionary.” Instead, the drafters placed “discretionary” where it modifies “County,”
and “other approvals and permits,” so as to convey an intention to exempt developments
that have obtained all “discretionary” approvals and permits, whether from the County or
elsewhere, prior to the effective date of the measure.
This straightforward interpretation was not only employed by the trial court, it was
expressly endorsed by the parties in their stipulation of undisputed facts. Furthermore, at
the hearing on the summary adjudication motions, County counsel acknowledged that
Section 22, subdivision (b) required only approvals for discretionary permits and, in this
case those discretionary permits were obtained prior to Measure D‟s effective date.
Finally, this interpretation of subdivision (b) is consistent with Sunol, supra, 124
Cal. App. 4th 276, the only published case we have found which discusses the meaning of
this provision, albeit in a different factual context.2
2
Sunol, supra, 124 Cal. App. 4th 276 involved a provision in Measure D referred to
as Policy 144 which requires voter approval after the County endorses any new quarries
outside the urban zone. (Id. at p. 278.) The Sunol court rejected the notion that Policy
144 read in conjunction with Section 22 required voter approval of every quarry outside
the urban zone that had not received “all approvals and permits.” Instead, the court held
that, “[a]ssuming Measure D applies generally to development that has not received all
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The County also argues that even if a project has received all discretionary
approvals prior to Measure D‟s effective date, it would still be prohibited under Section 3
of Measure D. As described in our factual summary, Section 3 is a savings clause that
states no part of the measure should be applied in a way that would deprive “any person
of constitutional or statutory rights or privileges” or in a way inconsistent with state or
federal law. The last sentence of Section 3 states: “To the extent that a provision or
provisions of this ordinance do not apply because of this section, then only the minimum
development required by law which is most consistent with the provisions and purposes
of this ordinance shall be permitted.”
The County focuses exclusively on this last sentence to argue that Section 3
imposes a “strict requirement” that any right to develop a project after the effective date
must be confined to the “minimum development required by law which is most consistent
with” Measure D. From this premise, the County builds this argument: (1) obtaining all
discretionary County approvals and permits does not confer a “vested” right to complete
a project; (2) without a vested right, a development project that is inconsistent with
Measure D cannot be legally completed; (3) therefore, it “makes no sense” to interpret
Section 22, subdivision (b) as authorizing a developer to continue with a project that he
or she has no vested right to complete.
The County‟s syllogism fails for a couple of reasons. Obtaining all discretionary
permits and approvals prior to the measure‟s effective date does confer a vested right to
complete a project pursuant to the language of Measure D. The County again focuses on
a part of Measure D in isolation so it can manufacture a conflict with another part of the
measure. Section 3 unequivocally states that Measure D was not intended to alter any
person‟s substantive legal rights. It is absolutely consistent with Section 22, which limits
Measure D‟s application by preserving development, whether existing or proposed, that
was approved by the County as of its effective date. The County‟s convoluted vested
discretionary approvals and permits prior to the effective date of the initiative, Policy 144
limits its provision to a subset of those developments-to quarries not approved by the
County.” (Id. at p. 284.)
17
rights theory does not undermine the clear language and obvious intent of these
provisions.
Section 22 is not ambiguous. By its plain language, it creates an exemption from
the restrictions and requirements of Measure D for all existing and unaltered
development, or proposed development provided the developer obtained all discretionary
County approvals and permits before December 22, 2000. Indeed, there was no dispute
about the meaning of this provision when the parties executed a stipulation of undisputed
facts in the trial court which included the following statement: “Section 22 of Measure D
states that Measure D applies only to development or proposed development which has
not received all discretionary county approvals and permits prior to the effective date of
the ordinance.” Although the County now wishes to back away from a straightforward
and logical interpretation of Measure D to suit its interests in this appeal, nothing
convinces us there is any merit in its alternative arguments made for the first time in this
court.
c. The County’s New Factual Theory
The County‟s last line of defense rooted in Section 22 is that, even if Section 22
exempts development and proposed development that obtained all discretionary
approvals before Measure D became effective, the project did not qualify for the
exemption because Lockaway failed to timely obtain all discretionary approvals.
Although mixed in with the County‟s legal theories bearing on interpretation of
Section 22, this actually challenges the sufficiency of the evidence supporting the trial
court‟s findings of fact. The September 2009 order, which was incorporated into the
statement of decision, contains an express finding that when Lockaway purchased the
property, the County had “already granted the final discretionary permit necessary to the
project Plaintiffs had in mind. Subsequent permits—for grading or building, for instance,
were and are indisputably ministerial in nature.”
Two principles of appellate review preclude the County from challenging this
finding on appeal. “ „Under the doctrine of invited error, where a party, by his conduct,
induces the commission of an error, he is estopped from asserting it as grounds for
18
reversal. [Citations]. Similarly an appellant may waive his right to attack error by
expressly or impliedly agreeing at trial to the ruling or procedure objected to on appeal.‟ ”
(Mesecher v. County of San Diego (1992) 9 Cal. App. 4th 1677, 1685-1686; see also K.C.
Multimedia, Inc. v. Bank of America Technology & Operations, Inc. (2009) 171
Cal. App. 4th 939, 950.)
Prior to the trial court hearing on the summary adjudication motions, the County
executed a written stipulation which established that the CUP for the Lockaway project
was obtained before Measure D went into effect and that the grading permit, although
issued after the measure went into effect, was a ministerial permit. Then, at the hearing,
the superior court asked County counsel whether all building permits for the Lockaway
project were ministerial. County counsel conceded the point and stated that Lockaway
obtained all discretionary permits required for its project before Measure D went into
effect. When the court granted Lockaway summary adjudication, it stated “[a]t oral
argument counsel for the County further conceded that in this case the building permit is
ministerial—in short, that Lockaway had received all discretionary permits prior to the
effective date of Measure D.”
The stipulation and counsel‟s acquiescence at the hearing operate to bar the County
from now challenging the superior court‟s finding that Lockaway secured all
discretionary County approvals before Measure D went into effect. “[F]airness is at the
heart of a waiver claim. . . . In our adversarial system, each party has the obligation to
raise any issue or infirmity that might subject the ensuing judgment to attack. [Citation.]
Bait and switch on appeal not only subjects the parties to avoidable expense, but also
wreaks havoc on a judicial system too burdened to retry cases on theories that could have
been raised earlier.” (JRS Products, Inc. v. Matsushita Electric Corp. of America (2004)
115 Cal. App. 4th 168, 178.)
Thus, we conclude that the County has failed to establish that the trial court erred
when it found that the Lockaway project was exempt from the use restrictions imposed
by Measure D.
19
B. The Regulatory Taking
Even if Measure D did not prohibit Lockaway from completing its project, the
County says that its temporary suspension of the project did not amount to a
constitutional taking as a matter of law. The County bases its position on two alternative
theories. It argues that the trial court‟s determination of whether or not there was a taking
should have been decided by application of the rule announced by the California
Supreme Court in Landgate Inc. v. California Coastal Com. (1998) 17 Cal. 4th 1006
(Landgate), rather than the factors to be considered under the test announced by the
Supreme Court of the United States in Penn Central, supra, 438 U.S. 104. The County
also argues that even the application of the factors identified in Penn Central should lead
to a conclusion that no taking occurred in this case. We will first discuss the general
legal principles that govern a takings claim, and in this context discuss the application of
the Penn Central factors to the facts of this case. We will then explain why the trial
court‟s analysis was properly controlled by Penn Central rather than Landgate.
“Whether the County‟s actions constituted a taking is a mixed question of law and
fact. [Citations.] Our review is neither entirely de novo nor entirely limited by the
substantial evidence rule. [Citation.] „Mixed questions of law and fact involve three
steps: (1) the determination of the historical facts—what happened; (2) selection of the
applicable legal principles; and (3) application of those legal principles to the facts. The
first step involves factual questions exclusively for the trial court to determine; these are
subject to substantial evidence review; the appellate court must view the evidence in the
light most favorable to the judgment and the findings, express or implied, of the trial
court. [Citations.]‟ [Citation.] Thus, we do not apply de novo review to factual findings
underlying the trial court‟s judgment, instead applying the substantial evidence rule.
[Citation.] Only the second and third steps involve questions of law, which we review de
novo.” (Shaw v. County of Santa Cruz (2008) 170 Cal. App. 4th 229, 269-270 (Shaw).)
The Fifth Amendment prohibits government from taking private property for
public use without just compensation. (U.S. Const., 5th Amend.) The federal takings
20
clause applies to the states via the Fourteenth Amendment. (Chicago, Burlington & Q.
R’D v. Chicago (1897) 166 U.S. 226, 234.) Moreover, the takings clause in the
California Constitution is “construed congruently with the federal clause.” (Shaw, supra,
170 Cal.App.4th at p. 260.)
The Fifth Amendment “ „does not prohibit the taking of private property, but
instead places a condition on the exercise of that power.‟ [Citation.] In other words, it „is
designed not to limit the governmental interference with property rights per se, but rather
to secure compensation in the event of otherwise proper interference amounting to a
taking.‟ ” (Lingle v. Chevron U.S.A. Inc. (2005) 544 U.S. 528, 536-537 (Lingle).) In this
way, the takings clause precludes the “ „Government from forcing some people alone to
bear public burdens which, in all fairness and justice, should be borne by the public as a
whole.‟ ” (Ibid.)
“The paradigmatic taking requiring just compensation is a direct government
appropriation or physical invasion of private property.” (Lingle, supra, 544 U.S. at p.
537.) However, courts have long recognized that “government regulation of private
property may, in some instances, be so onerous that its effect is tantamount to a direct
appropriation or ouster—and that such „regulatory takings‟ may be compensable under
the Fifth Amendment.” (Ibid.; see also Kavanau v. Santa Monica Rent Control Bd.
(1997) 16 Cal. 4th 761, 773 (Kavanau).) More recently, the United States Supreme Court
confirmed that a regulation may effect a taking requiring just compensation even if it
does not deprive the owner of “all economically beneficial use” of his or her property,
depending on the particular circumstances of the case. (Palazzolo v. Rhode Island (2001)
533 U.S. 606, 617.)
Furthermore, a temporary regulatory taking may require payment of just
compensation for the period the taking was in effect. (First Lutheran Church v. Los
Angeles County (1987) 482 U.S. 304, 321 [applying rule to taking of all use of property].)
Thus, if a property owner prevails in an inverse condemnation action, and the regulatory
agency elects to withdraw the regulation that effected the taking, the property owner may
have a right to just compensation for the period that the regulation was in effect.
21
(Kavanau, supra, 16 Cal.4th at p. 773; see also Ali v. City of Los Angeles (1999) 77
Cal. App. 4th 246, 251.)
A regulatory takings analysis rests on the foundational principle that “while
property may be regulated to a certain extent, if regulation goes too far it will be
recognized as a taking.” (Penna. Coal Co. v. Mahon (1922) 260 U.S. 393, 415.) To
assist courts in discerning “how far is „too far,‟ ” the United States Supreme Court has
identified three distinct categories of regulatory takings and the tests for evaluating each.
(Lingle, supra, 544 U.S. at p. 538.) First, there is government action which requires a
property owner to “suffer a permanent physical invasion” of his or her property. (Ibid.)
The second category includes regulatory conduct that does not result in any physical
invasion but deprives the owner of “all economically beneficial use” of the property.
(Ibid.) These two “relatively narrow categories” of regulatory action are subject to a
categorical rule and are deemed per se takings for Fifth Amendment purposes. (Ibid.) A
regulatory taking challenge that does not fall into one of these two narrow categories is
evaluated under a set of standards first articulated by the Supreme Court in Penn Central,
supra, 438 U.S. 104. (Lingle, supra, 544 U.S. at p. 538.)
The Penn Central inquiry is not a formula but an ad hoc factual inquiry that
weighs “several factors for evaluating a regulatory taking claim.” (Penn Central, supra,
438 U.S. at p. 124; Lingle, supra, 544 U.S. at p. 538.) Courts conducting such an inquiry
have identified three primary factors: (1) the “economic impact” of the regulation on the
claimant, (2) the extent to which the regulation interfered with “distinct investment-
backed expectations,” and (3) the “character of the governmental action.” (Shaw, supra,
170 Cal.App.4th at p. 272; see Penn Central, supra, 438 U.S. at p. 124.) These Penn
Central factors are “the principal guidelines” for resolving regulatory takings claims that
do not fall within the two per se categories. (Lingle, supra, 544 U.S. at p. 539.)
The Penn Central inquiry is not a means-ends test; the question is not “whether a
regulation of private property is effective in achieving some legitimate public purpose.”
(Lingle, supra, 544 U.S. at p. 542.) Instead, the goal is to assess the “magnitude or
character of the burden a particular regulation imposes upon private property rights” in
22
order to determine whether its effects are “functionally comparable to government
appropriation or invasion of private property.” (Ibid.)
We will first consider the economic impact of the regulation on Lockaway. Of
course, many land use regulations that adversely impact property interests are not
regulatory takings. (Shaw, supra, 170 Cal.App.4th at p. 272; Allegretti & Co. v. County
of Imperial (2006) 138 Cal. App. 4th 1261, 1278.) But a government action that
unreasonably impairs the value or use of the property may be an indication that a taking
occurred. (Ibid.)
The County‟s decision to deny Lockaway the right to complete its development
project did not render the property worthless. The trial court found that some alternative
uses, consistent with the terms of Measure D, had calculable commercial value.
However, the court also found that Lockaway always intended to develop the property as
a storage facility, and requiring it to pursue some different authorized use would have
deprived Lockaway of the return on its investment that it “reasonably expected from the
intended use.” Furthermore, the court found that by August 2002 when the County “got
around to informing [Lockaway] that Measure D would have stopped their project in its
tracks back in December 2000,” Lockaway was fully committed to developing the
storage facility and had already spent significant resources committing its property to that
specific use. The court also found that Lockaway would have incurred substantial costs
to convert the property to another use after the County had shut it down and would have
suffered a material decrease in its value. On appeal, the County does not dispute any of
these findings, and they all support the trial court‟s conclusion that the County‟s
regulatory action unreasonably impaired both the value and use of the Lockaway
property.
The second Penn Central factor requires us to consider the extent to which the
County‟s regulatory action interfered with Lockaway‟s distinct investment backed
expectations. “A „reasonable investment-backed expectation‟ must be more than a
„unilateral expectation or an abstract need.‟ ” (Ruckelshaus v. Monsanto Co. (1984) 467
U.S. 986, 1005.)
23
The evidence supports the conclusion that this factor is satisfied. Lockaway
purchased the property only after the County expressly confirmed that Lockaway could
rely on the 1999 CUP to develop a storage facility. After its initial confirmation, the
County worked closely with Lockaway for a few years. As the termination date of the
1999 CUP approached, County staff told Lockaway that the CUP had been implemented.
But once the September 22, 2002, expiration date had passed, the County changed its
position and used Measure D to shut the Lockaway project down. On these facts, there is
no denying that Lockaway had a reasonable investment backed expectation its project
could proceed from the time it purchased the property in 2000, until the County changed
its position in 2002.
The third Penn Central factor requires us to consider the “character” of the
County‟s action. (Penn Central, supra, 438 U.S. at p. 124; Lingle, supra, 544 U.S. at p.
542.) To illustrate what this means, the Lingle court stated that whether a governmental
action “amounts to a physical invasion or instead merely affects property interests
through „some public program adjusting the benefits and burdens of economic life to
promote the common good‟—may be relevant in discerning whether a taking has
occurred.” (Lingle, supra, 544 U.S. at p. 539.)
Here, the County caused no physical invasion of the Lockaway property. By the
same token, however, the County‟s decision to abandon the approvals for the Lockaway
project cannot be justified as a “mere” consequence of a public program. Instead, the
character of the County‟s decision is defined by the circumstances surrounding the
application of the Measure D restrictions to this project. The trial court found that the
County made a “showstopping U-turn starting with the September 23, 2002 [Advisory
Council] meeting at which it took the eleventh-hour position that nothing Plaintiffs did—
or could have done—since way back in December of 2000 when Measure D became
effective, would have made any difference in the outcome of the permit process. When
this trap door closed on Plaintiffs, the „character‟ of the government‟s conduct revealed
itself.”
24
On appeal, the County contends there is insufficient evidence to support the trial
court‟s findings regarding the character of its regulatory action. We disagree. The
following pertinent facts are supported by substantial evidence. The County did not take
any action to shut down the Lockaway project in December 2000 when Measure D went
into effect. Instead, it encouraged Lockaway to continue its development efforts for 18
months. Then, in September 2002 the County changed its position and announced that
the project had been doomed since December 2000 because Lockaway had not obtained
all permits and commenced construction before Measure D‟s effective date. In taking
this new stand, the County refused to even consider whether Section 22 exempted the
Lockaway project.
These facts support the trial court‟s conclusion that the County‟s regulatory about
face was manifestly unreasonable, not just because of its devastating economic impact on
Lockaway, but also because it deprived Lockaway of a meaningful opportunity to attempt
to protect its property rights. If the County had invoked Measure D in December 2000,
Lockaway could have then chosen to abandon its project or to challenge the County‟s
regulatory action as a taking. Alternatively, if, in September 2002 the County had taken
the position that Lockaway failed to implement the 1999 CUP, Lockaway could have
secured an administrative determination as to whether it had a vested right to complete
the project. Instead, the County solicited the application for a new CUP in September
2002, and then took the position that any of Lockaway‟s efforts after December 2000
were irrelevant. In fact, the County does not dispute the trial court‟s express finding that
the County “utterly failed to analyze, account for, or even mention, the safe harbor
language in Section 22 of the measure” during the regulatory process leading up to this
litigation.
Now, the County spends significant effort attempting to convince us to adopt a
new and different interpretation of Section 22 which arguably in hindsight could support
the County‟s decision to block the Lockaway project. The County also argues that each
of its possible interpretations of Section 22 that we have rejected in part III.A.2, ante, of
this opinion show that the County‟s regulatory position was reasonable. Nonsense. First
25
of all, as we have discussed, each of these interpretations is based on a strained reading of
Measure D. Moreover, there is nothing in this record to suggest anyone at the County
thought of these reasons when the County determined that the Lockaway project was
prohibited by Measure D. The County steadfastly refuses to address the consequences
that would normally flow from the fact that it never made any of these legal arguments
until after Lockaway obtained the writ of mandate. By acting as it did, the County
effectively precluded Lockaway from obtaining administrative review of the many issues
that the County has aggressively pursued in judicial proceedings.3
Thus, although the County protests the factual underpinnings for the trial court‟s
characterization of its action as unfair, our analysis of the third Penn Central factor
shows the court‟s findings are supported by substantial evidence. Accordingly, the
County has failed to establish that the trial court committed reversible error when it
determined that under the Penn Central inquiry, the County‟s application of Measure D
to shut down the Lockaway project was a temporary regulatory taking that required the
payment of just compensation.
C. Landgate
In Landgate, supra, 17 Cal. 4th 1006, the California Coastal Commission denied a
property owner‟s application for a development permit on various grounds including one
that had previously been approved by the county. The trial court concluded the
Commission did not have jurisdiction to reverse the county‟s determination, issued a writ
of mandate requiring the Commission to reconsider the property owner‟s application, and
found that the two-year delay in the permitting process due to the Commission‟s
3
In the trial court, the County argued that Lockaway was free to raise any issue in
the various administrative proceedings. As the trial court found, this argument misses the
point. During the administrative proceedings, the County never took the position that
Lockaway did not have a vested right in the project because it did not implement the
1999 CUP, and yet that was a central argument at trial. Similarly, during the
administrative hearings, the County never advanced any of the legal interpretations of
Section 22 that comprise a significant portion of this appeal.
26
disapproval constituted a temporary regulatory taking. (Id. at pp. 1010-1014.) The Court
of Appeal affirmed the judgment but our Supreme Court reversed.
The Supreme Court framed the issue as “whether a legally erroneous decision of a
government agency during the development approval process resulting in delay
constitutes a temporary taking of property.” (Landgate, supra, 17 Cal.4th at p. 1018.)
The court concluded that such an error alone does not amount to a taking when it is “part
of a reasonable regulatory process designed to advance legitimate government interests.”
(Id. at p. 1021.) Furthermore, the court found, “[t]he 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.” (Id. at p.
1022.) But the Landgate rule is subject to an important caveat, “a government agency
may not evade the takings clause by fabricating a dispute . . . or by otherwise arbitrarily
imposing conditions on development in order to delay or discourage that development.
The government agency‟s assertion of authority, whether or not erroneous, must advance
some legitimate government purpose.” (Id. at p. 1029.) Thus, for example, even when a
regulation substantially advances a legitimate government purpose, if the agency‟s
“position was so unreasonable from a legal standpoint as to lead to the conclusion that it
was taken for no purpose other than to delay the development project before it,” the
action would amount to a taking. (Id. at p. 1024.)
In the present case, the County contends the trial court committed reversible error
when it made its taking determination by applying Penn Central instead of Landgate.
Moreover, it says that under Landgate, its change of position did not constitute a
temporary regulatory taking as a matter of law. We disagree with both of these
contentions.
Landgate was decided before the United States Supreme Court announced its
decision in Lingle, supra, 544 U.S. 528, that held regulatory takings cases that do not fall
into one of two narrow categories are governed by the Penn Central test. In Landgate,
the court acknowledged the Penn Central factors, but it relied on a different test evolved
27
from language in Agins v. City of Tiburon (1980) 447 U.S. 255, 260. (See Landgate,
supra, 17 Cal.4th at pp. 1016, 1019, 1021, 1022.) The Agins court stated that “[t]he
application of a general zoning law to particular property effects a taking if the ordinance
does not substantially advance legitimate state interests, [citation], or denies an owner
economically viable use of his land.” (Agins, supra, 447 U.S. at p. 260.) Through
development of the case law, the Agins rule evolved into a “stand-alone regulatory
takings test” which focused exclusively on whether the challenged government action
substantially advanced a legitimate state interest. (See Lingle, supra, 544 U.S. at p. 542.)
However, the Lingle court expressly held that “the „substantially advances‟
formula announced in Agins is not a valid method of identifying regulatory takings for
which the Fifth Amendment requires just compensation.” (Lingle, supra, 544 U.S. at p.
545.) As the Lingle court explained, the formula is a due process test which, when used
as a takings test, is “doctrinally untenable” and poses “serious practical difficulties.” (Id.
at p. 544.) That formula is not a useful tool for identifying a taking because it “reveals
nothing about the magnitude or character of the burden a particular regulation imposes
upon private property rights” and it does not provide any information about “how any
regulatory burden is distributed among property owners.” (Id. at p. 542.) As a practical
matter, the formula would require courts to engage in a “means-ends” analysis of
government regulations affecting private property which is “a task for which courts are
not well suited.” (Id. at p. 544.)
In light of Lingle, we reject the County‟s contention that Landgate establishes an
independent test for evaluating whether government action is a regulatory taking. The
only case the County cites to support its contention was decided before Lingle. (See
Loewenstein v. City of Lafayette (2002) 103 Cal. App. 4th 718, 731, 733 [erroneous denial
of application for lot line adjustment not a temporary taking absent evidence that action
“was taken for any motive other than carrying out a substantial government interest”].)
Indeed, since Lingle was decided, several courts have questioned whether the Landgate
rule remains viable. (See Shaw, supra, 170 Cal.App.4th at p. 264 [and authority cited
there]; see also Los Altos El Granada Investors v. City of Capitola (2006) 139
28
Cal. App. 4th 629, 651.) We have no doubt that the trial court applied the proper analysis
in this case by following Penn Central. (Lingle, supra, 544 U.S. 528.)
Moreover, even assuming Landgate remains good law, its complete holding is that
a delay in the development process caused by an agency‟s mistaken though plausible
assertion of jurisdiction is a “normal delay” that, by itself, does not constitute a temporary
taking, but such a taking may result from patently unreasonable or arbitrary governmental
action. (See Landgate, supra, 17 Cal.4th at pp. 1010, 1020-1021, 1024, 1029; see also
Ali, supra, 77 Cal.App.4th at p. 254 [temporary taking occurred when delay in the
regulatory process attributable to an agency position was “so unreasonable from a legal
standpoint as to be arbitrary.”].)
In this case, the trial court considered the Landgate rule in the context of its
application of the third Penn Central factor, which focuses on the character of the
governmental conduct. In that context, the court rejected the County‟s theory that its
“conduct amounted to no more than normal delay in the permit process,” and instead
found that the circumstances surrounding the “doctrinal shift” in the County‟s
interpretation of Measure D “takes the case out of the „normal-if-mistaken-regulatory-
activity‟ paradigm and turns it into a taking.”
The County continues to claim that its conduct was nothing more than an honest
mistake resulting in a normal regulatory delay. Under the County‟s version of events,
some of its staff honestly but erroneously believed that Measure D did not prevent
Lockaway from completing its project until they consulted County counsel in August
2002, when counsel corrected the staff‟s legally erroneous interpretation of the measure.
Thereafter, the County says, it reasonably relied on the advice of legal counsel when it
adopted its new and allegedly correct interpretation of Measure D which precluded
Lockaway from completing its project.
The most obvious problem with this argument is the County‟s position that its
2002 interpretation of Measure D was legally correct. It was not. Nor do the record
citations provided by the County show anything more than the fact County counsel
adopted a different interpretation of Measure D than the interpretation employed by
29
County staff during the two years Lockaway owned the property before the regulatory
hearings began. This evidence does not establish the basis for the County‟s about face, or
support the conclusion that the County made an honest and reasonable mistake that led to
normal delay.
Equally troubling, the County ignores the evidence that supports the trial court‟s
finding that the timing and nature of the County‟s change of position take this case
outside of the Landgate rule. The timing of the County‟s shift had a substantial negative
economic impact on Lockaway and eviscerated its reasonable investment backed
expectations. Its dogmatic interpretation of Measure D adopted in August 2002 deprived
Lockaway of a meaningful opportunity to protect its property rights. Landgate, supra, 17
Cal. 4th 1006, does not alter our conclusion that substantial evidence supports the trial
court‟s finding that a compensable temporary regulatory taking occurred. In fact, it
reinforces it.
D. Attorney Fees
The County contends that even if the judgment is affirmed, the award of attorney
fees to Lockaway must be reversed because the fee award included compensation for
work attributable to civil rights causes of action on which Lockaway did not prevail.
1. Background
Section 1036, states that: “In any inverse condemnation proceeding, the court
rendering judgment for the plaintiff by awarding compensation . . . shall determine and
award or allow to the plaintiff, as a part of that judgment . . . a sum that will, in the
opinion of the court, reimburse the plaintiff‟s reasonable costs, disbursements, and
expenses, including reasonable attorney, appraisal, and engineering fees, actually
incurred because of that proceeding in the trial court or in any appellate proceeding in
which the plaintiff prevails on any issue in that proceeding.”
Lockaway moved for a lodestar award of $703,760 for attorney fees actually
incurred, plus a 1.25 multiplier for a total award of $879,700. Lockaway supported its
fee request with attorney time records, a declaration of counsel and the declaration of an
attorney who specializes in land use law. The lodestar request included fees for work on
30
the unsuccessful civil rights claims because Lockaway considered those claims to be
related to their successful inverse condemnation claim since all “were based on the same
identical underlying facts and the damages were identical.” According to Lockaway, the
civil rights claims were essentially alternative legal theories and work done on those
claims was therefore recoverable under section 1036.
The County opposed the attorney fee motion on several grounds, including that
section 1036 limited recoverable fees to efforts related only to the inverse condemnation
cause of action, and that the lodestar request was inflated because it included fees for
work done on the civil rights claims and work related to liability of individual defendants
who could not have been liable for inverse condemnation. At the conclusion of the
hearing, the court took the matter under submission.
The trial court awarded Lockaway its fees on June 10, 2011. That order states in
pertinent part: “After considering all of the briefs, declarations and evidence submitted to
the Court, as well as the record in this matter, and having heard the arguments of counsel,
the Court awards attorney fees to plaintiff in the amount of $703,760.00 with an
additional $24,255.50 for work preparing for and attending this hearing for a total of
$728,015.50, an amount the Court finds to be reasonable under all of the circumstances.”
2. Analysis
Although the County claims that the trial court failed to “specify the basis for the
award,” it is obvious from the record that the court adopted the lodestar approach
proposed by Lockaway, rejected the multiplier and awarded Lockaway fees for work on
both the inverse condemnation claim and the relevant civil rights causes of action
pursuant to section 1036.
The County does not dispute that section 1036 authorizes a fee award in this case.
Rather it contends that the trial court‟s decision to award fees for work conducted in
connection with the unsuccessful civil rights claims cannot be sustained, at least not on
this record. Therefore, the County requests that we reverse the fee order and remand this
case for further proceedings. As we shall explain, a remand is not necessary.
31
The trial court had discretion to award Lockaway fees incurred with respect to the
civil rights causes of action if they were relevant to the inverse condemnation claim.
When awarding fees under section 1036, “the trial court generally should apportion
between attorney fees incurred in litigating the inverse condemnation claim and fees
incurred with respect to other claims for which attorney fees are not recoverable, and
award only the former. [Citations.] However, the trial court has discretion to award fees
incurred with respect to a noninverse condemnation cause of action that is relevant to the
inverse condemnation claim.” (Red Mountain, LLC v. Fallbrook Public Utility Dist.
(2006) 143 Cal. App. 4th 333, 365-366.)
At the hearing on the fee motion, the trial court expressly stated that the degree of
interconnection between the inverse condemnation claim and the civil rights causes of
action was a key consideration. The trial court considered all the pleadings and evidence
before making its ruling. We have no difficulty concluding that the trial court made an
implicit finding that Lockaway was entitled to fees incurred on the civil rights claims
because that work was relevant to its inverse condemnation cause of action.
The County contends that no such finding can be implied, but settled principles of
procedure say otherwise. A trial court is not required “to issue a statement of decision
with regard to the fee award,” or to provide detailed reasons for overruling objections to a
fee request. (Ketchum v. Moses (2001) 24 Cal. 4th 1122, 1140.) Furthermore, since the
County did not request a statement of decision with specific findings, “ „ “[a]ll
intendments and presumptions are indulged to support [the judgment] on matters as to
which the record is silent, and error must be affirmatively shown.” ‟ ” (Ibid.) “No
specific findings reflecting the court‟s calculations [are] required. [Citation.] „The
record need only show that the attorney fees were awarded according to the “lodestar” or
“touchstone” approach.‟ [Citation.] On appeal we infer all findings in favor of the
prevailing parties.” (Wershba v. Apple Computer, Inc. (2001) 91 Cal. App. 4th 224, 254.)
According to the County, the trial court‟s discretion afforded by section 1036 is so
“limited” that a trial court cannot award fees for work on non-inverse condemnation
claims unless it makes an explicit finding that alleged sets of claims are relevant to one
32
another. However, the case the County cites for this proposition, Red Mountain, supra,
143 Cal.App.4th at 367, does not hold or intimate that section 1036 requires that the trial
court make such an explicit finding.
The County also relies on Greater Westchester Homeowners Assn. v. City of Los
Angeles (1979) 26 Cal. 3d 86 (Greater Westchester),where a property owner secured a
judgment against the City for direct condemnation, inverse condemnation and personal
injury on a nuisance theory. The trial court awarded plaintiffs‟ attorney fees but did not
segregate or allocate the fees among the three bases for relief. The Greater Westchester
court held that the fees should have been segregated because (1) the plaintiffs could
recover fees for direct condemnation “only when and if” the trial court made certain
statutory findings that had not been made during the attorney fee proceeding in the lower
court; (2) “[a]ttorney‟s fees [were] clearly recoverable and appropriate with respect to
inverse condemnation” under section 1036; and (3) the parties in that case had already
agreed that fees could not be assessed with respect to the personal injury claim. (Greater
Westchester, supra, 26 Cal.3d at pp. 103-104.)
According to the County, “Greater Westchester makes clear [that] fee-shifting is
allowed under a particular statute „only when and if the trial court makes those statutory
findings required by‟ the statute.” However, the Greater Westchester Court‟s conclusion
in this regard only addressed Code of Civil Procedure section 1250.410, which authorizes
a fee award for direct condemnation. (Greater Westchester, supra, 26 Cal.3d at p. 104.)
The court did not hold that section 1036 requires any express findings.
Finally, the County spends significant time arguing that the section 1036
“relevancy” requirement is an exacting test which requires something more than a
determination that two sets of claims are “related.” We will not address this theory
because the County does not challenge the sufficiency of the evidence to support the trial
court‟s implied finding that the civil rights claims were relevant to the inverse
condemnation cause of action, and the record in this court does not support the argument.
The County apparently made the strategic decision to exclude evidence pertinent to the
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fee request from the appellate record, gambling that we would grant its request for a
remand.
IV. DISPOSITION
The judgment and order awarding attorney fees are affirmed.
_________________________
Siggins, J.
We concur:
_________________________
McGuiness, P.J.
_________________________
Jenkins, J.
34
Trial Court: Alameda County Superior Court
Trial Judge: Honorable James A. Richman
Honorable John M. True, III
Counsel for Defendants and Appellants: Robert G. Crow
Jill Sazama
Boornazian, Jensen & Garthe
Brian E. Washington
Office of the County Counsel
County of Alameda
Rick W. Jarvis
Andrea J. Saltzman
Jarvis, Fay, Doporto & Gibson
Counsel for Plaintiffs and Respondents: Timothy V. Kassouni
Counsel for Amicus Curiae on behalf
of Plaintiffs and Respondents: R. S. Radford
Pacific Legal Foundation
35