The County of Alameda (County) determined that an amendment to its general plan adopted by voters as Measure D prohibited Lockaway Storage and other parties, 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 years after Measure D was implemented, was an
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 the Department of Transportation 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 (RV's) 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.
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
Notwithstanding section 19 (Section 19), two other sections of Measure D limit its application. One is section 3 (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 (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."
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
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.
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 Section 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.
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.
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.
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
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 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.
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
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 [57 L.Ed.2d 631, 98 S.Ct. 2646] (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 phase II period. With the addition of prejudgment interest, Lockaway's damages on its inverse condemnation cause of action totaled $989,640.96.
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.
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.
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 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.
"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
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.)
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 [92 Cal.Rptr.2d 268]. 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.
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, 479, 480 [98 Cal.Rptr.2d 202].) 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.
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
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 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
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.
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
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.
The County's third new theory is that, if subdivision (b) is a grandfather clause, it applies only to a 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 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)
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.
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.
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 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 [12 Cal.Rptr.2d 279]; see K.C. Multimedia, Inc. v. Bank of America Technology & Operations, Inc. (2009) 171 Cal.App.4th 939, 950 [90 Cal.Rptr.3d 247].)
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.
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 [73 Cal.Rptr.2d 841, 953 P.2d 1188] (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.
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 [161 L.Ed.2d 876, 125 S.Ct. 2074] (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.'" (544 U.S. at p. 537.)
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 [96 L.Ed.2d 250, 107 S.Ct. 2378] [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. (Kavanau, supra, 16 Cal.4th at p. 773; see Ali v. City of Los Angeles (1999) 77 Cal.App.4th 246, 251 [91 Cal.Rptr.2d 458].)
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 [42 Cal.Rptr.3d 122].) But a government action that unreasonably impairs the value or use of the property may be an indication that a taking occurred. (Shaw, at p. 272; Allegretti & Co., at p. 1278.)
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 evidence supports the conclusion that this factor is satisfied. Lockaway purchased the property only after the County expressly confirmed that
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."
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.
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 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.
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 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.
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 [127 Cal.Rptr.2d 79] [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 Cal.App.4th 629, 651 [43 Cal.Rptr.3d 434].) 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.)
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 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
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.
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 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
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.
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.
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 noninverse condemnation claims unless it makes an explicit finding that alleged sets of claims are relevant to one another. However, the case the County cites for this proposition, Red Mountain, supra, 143 Cal.App.4th at page 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 [160 Cal.Rptr. 733, 603 P.2d 1329] (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] feeshifting 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
The judgment and order awarding attorney fees are affirmed.
McGuiness, P. J., and Jenkins, J., concurred.