In April 2008, the City of Solana Beach (City) determined a mixed-use development proposal was inconsistent with certain local zoning and specific plan requirements, and directed the project's proponents to redesign the project. About 16 months later, on September 2, 2009, plaintiffs Rosa Maria Haro and Carlos Ibarra filed a petition for writ of mandate and a complaint, alleging the City's actions violated state laws pertaining to affordable housing and land use. The trial court sustained the City's demurrer to plaintiffs' first amended complaint without leave to amend, concluding plaintiffs' claims were untimely and the complaint failed to state a cause of action (except for one claim).
On appeal, plaintiffs contend the court erred in determining their claims were governed by the 90-day limitations period in Government Code section
Because we are reviewing a judgment after a demurrer, we summarize the facts based on the allegations of the first amended complaint and documents that were properly the subject of judicial notice. (See Sprinkles v. Associated Indemnity Corp. (2010) 188 Cal.App.4th 69, 74 [114 Cal.Rptr.3d 887].)
In 2004, certain owners/developers (developers) proposed to build a mixed-use development at the location of the Solana Beach train station. This proposed development, known as the Cedros Crossing project, included offices, restaurants, retail businesses, parking, and 141 residential units, at least 13 of which would be affordable to lower income households.
While the developers were seeking the necessary permits for the project, in August 2006 the City adopted its revised housing element (Housing Element), a required part of the City's general plan. The Housing Element contains policies to provide for the City's regional housing needs, determined to be 131 total units, including 52 units for persons with low or very low incomes.
Two aspects of the City's Housing Element are relevant to plaintiffs' claims.
First, the Housing Element identifies nine separate sites that have the potential for residential development. "Site 8," the area that includes the Solana Beach train station, was identified for a possible mixed-use development. The Housing Element states that Site 8 "will be a key to the City's ability to meet not only its regional share for new construction but also its quantified objectives by income category. The 131 proposed rental unit mixed use development also has a set aside for 13 lower income units. This project
Second, the City's Housing Element identifies "Program 1," which consists of a plan to implement various "activities to encourage mixed-use development." These activities include conducting meetings with the community and developers, reviewing potential federal and state housing financing and subsidy programs, and working to increase developer awareness of the potential for mixed-use development.
In December 2006, the City submitted its Housing Element to the state Department of Housing and Community Development (State Housing Department), the state agency responsible for approving housing elements. The next month, the State Housing Department found the Housing Element in compliance with state law, "conditioned on the approval of" several factors, including a development application for Site 8 for 131 units, including 13 affordable units, and the successful implementation of Program 1 to encourage residential capacity in mixed-use developments.
During the next year, the City held numerous public hearings on the proposed Cedros Crossing project, and certified the final environmental impact report for the project. On April 28, 2008, the city council held a hearing to consider the developers' request for various permits and approval of a tentative subdivision map. After the hearing, the city council voted to direct the developers to redesign the project. It found the submitted design was inconsistent with certain local zoning and specific plan requirements. This action caused the Cedros Crossing project to become financially infeasible because a $6 million grant was conditioned on approval of the project by April 30, 2008.
About two months later, on July 3, 2008, plaintiffs gave the City written notice that the City's failure to approve the project constituted a failure to implement the Housing Element and indicated that they intended to take formal legal action if the City did not amend and/or implement the Housing Element. In response, on August 27, 2008, the city council adopted resolution No. 2008-152, retaining outside defense counsel to represent the City in the challenge to the Housing Element.
The City demurred to all causes of action. The City argued plaintiffs' claims were untimely. The City relied primarily on section 66499.37, which establishes a 90-day limitations period for claims challenging a public entity's actions "concerning a subdivision," including "the approval of a tentative map or final map." The City alternatively argued the claims were barred under the longer one-year limitations period in section 65009(d), applicable to certain housing element challenges brought in support of affordable housing. The City additionally urged the court to sustain the demurrer because plaintiffs failed to state a claim under substantive law.
In opposing the demurrer, plaintiffs argued the suit was governed by the one-year limitations period of section 65009(d) because it pertained to affordable housing and alleged violations of housing element law. Plaintiffs argued the complaint (filed Sept. 2, 2009) was timely under section 65009(d) because under this subdivision, the one-year limitations period did not begin to accrue until "October 26, 2008, 60 days
Following a hearing, the trial court sustained the City's demurrer without leave to amend. As to all causes of action, the trial court found section
"`"On appeal from an order of dismissal after an order sustaining a demurrer, our standard of review is de novo, i.e., we exercise our independent judgment about whether the complaint states a cause of action as a matter of law."'" (Los Altos El Granada Investors v. City of Capitola (2006) 139 Cal.App.4th 629, 650 [43 Cal.Rptr.3d 434].) In reviewing the complaint, we must assume the truth of all facts properly pleaded by the plaintiff and matters properly judicially noticed. (Howard Jarvis Taxpayers Assn. v. City of La Habra (2001) 25 Cal.4th 809, 814 [107 Cal.Rptr.2d 369, 23 P.3d 601].) However, we "do not assume the truth of contentions, deductions, or conclusions of fact or law and may disregard allegations that are contrary to the law or to a fact which may be judicially noticed." (Dutra v. Eagleson (2006) 146 Cal.App.4th 216, 221 [52 Cal.Rptr.3d 788].) Additionally, we are not bound by the trial court's stated reasons supporting its ruling; we review the ruling, not its rationale. (Walgreen Co. v. City and County of San Francisco (2010) 185 Cal.App.4th 424, 433 [110 Cal.Rptr.3d 498].)
A locality is required to submit its draft housing element to the State Housing Department. (§ 65585, subd. (b).) If the department finds the housing element substantially complies with housing element law, the housing element has a rebuttable presumption of validity. (§ 65589.3.) After the housing element is approved and adopted, the local government "must review its housing element periodically to evaluate the community's progress toward attainment of local and state housing goals and objectives" (Black Property
In this case, plaintiffs alleged that although the Housing Element was proper when it was initially adopted and approved in 2006 and 2007, the predicate for its validity under state law was the condition that the City would approve development on Site 8 that would include 13 units of affordable housing for lower income households. Plaintiffs claimed the City's April 28 decision that the Cedros Crossing project violated the City's zoning ordinance and specific plan meant that the Housing Element no longer identified adequate sites to meet the City's share of regional housing needs. Plaintiffs further alleged that the Housing Element no longer complied with state law because the City's actions demonstrated it would not approve a project at that site that would contain sufficient affordable housing to meet the City's needs. Based on these allegations, plaintiffs claimed the City violated housing element law and numerous other land use statutes.
The City countered that nothing in the housing element law required the City to approve a specific housing project or implement selected programs identified in its Housing Element. It argued there is no authority supporting plaintiffs' theory that a housing element, facially valid upon its enactment, becomes "noncompliant" over time by a City's purported failure to approve a specific project or implement selected programs. The City further argued that each of plaintiffs' additional causes of action had no legal basis.
As explained below, we do not resolve these contentions because plaintiffs' complaint was untimely. We thus do not determine the validity of the court's conclusion that plaintiffs' claims do not state a cause of action under California law.
Plaintiffs contend the court erred in concluding the action was untimely because it was filed beyond the 90-day limitations period of section 66499.37. They argue the one-year limitations period set forth in section 65009(d) governs the lawsuit because the action was brought in support of affordable housing and pertained to the implementation of the City's Housing Element. However, even if we assume plaintiffs are correct that section 65009(d) is the applicable statute of limitations, the suit is still untimely.
Section 65009(d) creates an exception to this 90-day rule, establishing a one-year limitations period applicable to actions "brought in support of or to encourage or facilitate" affordable housing (§ 65009(d)(1)) if the action is brought with respect to certain governmental actions, including specified actions taken pertaining to housing element law (§ 65009(d)(2); see Travis v. County of Santa Cruz, supra, 33 Cal.4th at p. 766, fn. 1). However, the goal of providing certainty for property owners and local governments applies equally to this subdivision. (See Urban Habitat Program v. City of Pleasanton (2008) 164 Cal.App.4th 1561, 1573 [80 Cal.Rptr.3d 300] (Urban Habitat).) Thus, the Legislature established a specific time period for the government entity to consider an objection based on affordable housing concerns and established strict accrual deadlines governing the commencement of this one-year limitations period. (§ 65009(d)(2).)
Specifically, the second paragraph of section 65009(d)(2) states in relevant part: "A cause of action brought pursuant to [section 65009(d)] shall not be maintained until 60 days have expired following notice to the city or clerk of the board of supervisors by the party bringing the cause of action, or his or her representative, specifying the deficiencies of the general plan, specific plan, or zoning ordinance. A cause of action brought pursuant to [section 65009(d)] shall accrue 60 days after notice is filed or the legislative body takes a final action in response to the notice, whichever occurs first."
In their complaint, plaintiffs alleged: "On July 3, 2008, Petitioners, through counsel, gave the City written notice that [city council's] failure to approve the [Cedros Crossing] Project and [i]mplement Program 1 had rendered its Housing Element invalid." They further alleged the City responded to this
Once a cause of action has accrued, "[a]n action or proceeding shall be commenced and the legislative body served within one year . . . ." (§ 65009(d), italics added.) Thus, under section 65009(d), the limitations period in this case ended on August 28, 2009. However, plaintiffs did not file their complaint until September 2, 2009. Therefore the action was untimely even assuming section 65009(d)'s one-year limitations period applied.
Plaintiffs assert several arguments in an attempt to avoid this result. These arguments are without merit.
First, plaintiffs contend that under section 65009(d), the statute does not begin to accrue until 60 days after the City took "final action" on the notice. They base their argument on the grammatical construction of the following sentence of section 65009(d)(2): "A cause of action brought pursuant to this subdivision shall accrue 60 days after notice is filed or the legislative body takes a final action in response to the notice, whichever occurs first." (Italics added.) They argue that the "60 days after" phrase modifies both the "notice is filed" conduct and the "legislative body takes a final action" conduct. (Ibid.)
Accepting plaintiffs' proposed interpretation of section 65009(d)(2) would violate these fundamental statutory interpretation principles because the statutory phrase "whichever occurs first" would become meaningless. If the accrual is not triggered until 60 days after the notice is filed or 60 days after the legislative body makes a final decision to deny the claim, the date the claimant files the notice necessarily will always be first. Because a notice must logically precede a rejection, 60 days from both actions would necessarily mean the notice date would always be first. Thus, there would be no need to include the "whichever occurs first" language. We cannot accept plaintiffs' proposed interpretation because it requires that we conclude a statutory phrase is superfluous. (See Shoemaker v. Myers (1990) 52 Cal.3d 1, 22 [276 Cal.Rptr. 303, 801 P.2d 1054]; Torrey Hills Community Coalition v. City of San Diego, supra, 186 Cal.App.4th at p. 440; Baldwin v. City of Los Angeles (1999) 70 Cal.App.4th 819, 838 [83 Cal.Rptr.2d 178].)
Our interpretation is consistent with other portions of the statute, which indicate the Legislature established two alternative accrual dates in the event the legislative/administrative body takes no formal action on the notice. The preceding sentence in section 65009(d)(2) provides that a party does not state a cause of action under the subdivision "until 60 days have expired following notice" to the legislative or administrative body. (§ 65998(d)(2).) By creating this "no-lawsuit" time period, the Legislature intended to provide the public entity the full 60 days to consider the claim before the matter may be prematurely challenged in court. But the Legislature also wanted to provide certainty in the event the legislative/administrative body took no formal action in response to a notice during this 60-day period. Thus, the Legislature structured section 65009(d)(2) to provide that the accrual is triggered from the final action, but no later than 60 days from the date notice is given.
Plaintiffs also contend their action was timely based on their allegation that the City never "filed" their July 3 claim and instead merely stamped the claim "Received" on July 8, 2008. Plaintiffs submitted a copy of the stamped document as part of their judicial notice request below. However, as discussed, because the City denied the notice before the 60-day period terminated (regardless whether the notice/filing was on July 3 or July 8), the notice or filing date is not relevant for purposes of determining the accrual date in this case.
Plaintiffs alternatively contend the court erred in refusing to provide them leave to amend their complaint.
It is an abuse of discretion to sustain a demurrer without leave to amend if the plaintiff shows a reasonable possibility a defect in the complaint may be cured by amendment. (Aubry v. Tri-City Hospital Dist. (1992) 2 Cal.4th 962, 970-971 [9 Cal.Rptr.2d 92, 831 P.2d 317]; Careau & Co. v. Security Pacific Business Credit, Inc. (1990) 222 Cal.App.3d 1371, 1387 [272 Cal.Rptr. 387].) A plaintiff has the burden to show in what manner the pleadings may be amended and how the amendments will change their legal effect. (Careau & Co., supra, 222 Cal.App.3d at p. 1388.)
The court did not abuse its discretion. Plaintiffs have not suggested, and there is nothing in the record supporting, a basis for concluding plaintiffs could amend the complaint to render the action timely.
Judgment affirmed. The parties to bear their own costs.
Huffman, Acting P. J., and O'Rourke, J., concurred.
