Thomas Felkay v. City of Santa Barbara
Case No: 17CV03351
Hearing Date: Tue Aug 06, 2019 9:30

Nature of Proceedings: Motion for Legal Ruling Imposing Liablity on Deft City Under Inverse Condemnation Pursuant to CCP 1260.040; Motion Summary Judgment/Adjudication

Motion for Summary Judgment or, in the Alternative, Summary Adjudication, or Motion for Legal Ruling

Cross-Motion for Legal Ruling Imposing Liability on Defendant City Under Inverse Condemnation Pursuant to CCP § 1260.040

Attorneys:

For Petitioner/Plaintiff: Joseph Liebman; Steven H. Kaufman (Nossaman LLP – Los Angeles); Richard Monk (Hollister & Brace)

For Respondent/Defendant: Kendall H. MacVey (Best Best & Kreiger – Riverside); Bruce W. Beach (Best Best & Krieger – San Diego)

Rulings:

1. The Court denies City of Santa Barbara’s motion for summary judgment or, in the alternative, summary adjudication of issues, or motion for legal ruling under CCP § 1260.040.

2. The Court denies the motion of Thomas Felkay, as trustee of the Emprise Trust, for a finding of liability for inverse condemnation under CCP § 1260.040.

Background

Thomas Felkay, as trustee of the Emprise Trust (“Emprise”), filed his petition for writ of mandate and complaint for inverse condemnation against the City of Santa Barbara (“City”). The action arises out of City’s June 6, 2017, denial of Emprise’s application for Coastal Development Permit 2013-00014 (“CDP”) for its property at 1925 El Camino De La Luz (“1925 ECDLL”).

The causes of action in the petition/complaint are: 1) Administrative Mandamus (CCP § 1094.5); 2) Inverse Condemnation (U.S. Const. amend. 5; Cal. Const., art. 1, § 19 – the Coastal Act, City’s LCP and zoning laws, and other requirements caused deprivation of all economically feasible and beneficial use of the property); 3) Inverse Condemnation – Temporary Regulatory Taking; and 4) Inverse Condemnation (U.S. Const. amend. 5; Cal. Const., art. 1, § 19 – City-caused geologic destabilization).

On January 9, 2018, the Court sustained the demurrer to the fourth cause of action without leave to amend. The Court set the hearing on the petition for writ of mandate for March 19, 2019, at which the Court denied the petition for writ of mandate. MSC is scheduled for September 6 and trial for October 1.

Motion for Summary Judgment/Adjudication

City moves for summary judgment or, in the alternative, summary adjudication of the remaining two causes of action (second and third). City asks the Court to adjudicate the second cause of action because 1) there is no triable issue of fact for a permanent regulatory taking since an essential element of the claim—a reasonable investment-backed expectation—is missing; and 2) the action is not ripe and there has not been an exhaustion of administrative remedies. City asks the Court to adjudicate that there is no triable issue on the application of Public Resources Code § 30010 to either cause of action since an essential element of the claim, i.e. City Council findings necessary to apply that section, is missing. City asks the Court to adjudicate the third cause of action because there is no triable issue for a temporary regulatory taking since an essential element of the claim, i.e. an unreasonable denial of the Permit, is missing.

City also purports to bring the motion under CCP § 1260.040(a), which permits a court to determine the issue of liability in an inverse condemnation proceeding. Dina v. People ex rel. Dep’t of Transportation, 151 Cal.App.4th 1029, 1044 (2007). There is some question as to whether CCP § 1260.040(a) applies in inverse condemnation actions. Weiss v. People ex rel. Dep’t of Transportation, 20 Cal. App. 5th 1156, 1170 (2018), review granted but not ordered was depublished at Weiss v. Dep’t of Transportation, 419 P.3d 534 (Cal. 2018). Emprise opposes the motion for summary judgment/ adjudication and filed its own motion for determination of liability for inverse condemnation pursuant to CCP § 1260.040.

1. Summary Judgment Standards: Summary judgment is appropriate where there is no triable issue as to any material fact and the moving party is entitled to a judgment as a matter of law. CCP § 437c(c). “A party may move for summary adjudication as to one or more causes of action within an action, one or more affirmative defenses, one or more claims for damages, or one or more issues of duty, if the party contends that the cause of action has no merit…. A motion for summary adjudication shall be granted only if it completely disposes of a cause of action, an affirmative defense, a claim for damages, or an issue of duty.” CCP § 437c(f)(1).

“The party moving for summary judgment bears an initial burden of production to make a prima facie showing of the nonexistence of any triable issue of material fact; if he carries his burden of production, he causes a shift, and the opposing party is then subjected to a burden of production of his own to make a prima facie showing of the existence of a triable issue of material fact.” Aguilar v. Atlantic Richfield Co., 25 Cal.4th 826, 850 (2001). “A defendant bears the burden of persuasion that ‘one or more elements of’ the ‘cause of action’ in question ‘cannot be established,’ or that ‘there is a complete defense’ thereto. (§ 437c, subd. (p)(2).)” Id.

“All that the defendant need do is to ‘show that one or more elements of the cause of action . . . cannot be established’ by the plaintiff. (Code Civ. Proc., § 437c, subd. (o)(2).) In other words, all that the defendant need do is to show that the plaintiff cannot establish at least one element of the cause of action—for example, that the plaintiff cannot prove element X.” Id. at 853-854.

“[F]rom commencement to conclusion, the party moving for summary judgment bears the burden of persuasion that there is no triable issue of material fact and that he is entitled to judgment as a matter of law.” Id. at 850. A burden of production entails only the presentation of evidence, while a burden of persuasion “entails the establishment through such evidence of a requisite degree of belief.” Id.

“A summary adjudication motion is subject to the same rules and procedures as a summary judgment motion.” Case v. State Farm Mut. Auto. Ins. Co., 30 Cal.App.5th 397, 401 (2018), quoting Lunardi v. Great-W. Life Assurance Co., 37 Cal.App.4th 807, 819 (1995).

2. Objections to Evidence: Emprise objects to separate statement #8 in City’s Separate Statement of Undisputed Material Facts filed in support of the motion and to a statement made at the hearing before the City Council, to wit: Exhibit 23 at AR0004074:22-25, page 232 of 383 in City’s Request for Judicial Notice Vol. 1. First, statements in the separate statement are not evidence. Any objection to a statement in the separate statement is essentially argument, which is appropriately addressed in a memorandum or in the response to the separate statement. As to the evidence underlying statement #8 in Exhibit 23, Emprise objects that the statement is hearsay and lacks foundation. A contiguous property owner testified before the City Council and said: “We also have a copy of the Padre resigning — or what should I say? — withdrawing their report because it was so erroneous, and you should have all of those by email or letter.” [Exhibit 23, AR0004074:22-25] City has not responded to this objection.

There is no demonstrated foundation for the neighbor’s assertion that some report was withdrawn. At best, she was relying on some other document or statement to that effect, which would make her statement hearsay. The Court sustains the evidentiary objection.

3. Disputed Material Facts: City lists 46 facts in its separate statement of undisputed material facts in support of its motion. City lists the identical 46 issues for the first three issues it wants adjudicated. For some reason, it only lists facts ##1-45 for the fourth issue. For each of the four issues, Emprise lists additional disputed facts ##47-56.

It its reply regarding the separate statements, City does not address Emprise’s disputes regarding City’s facts. This includes #8, with respect to which the Court has sustained the objection to the underlying evidence. Emprise also disputes #17 (buildable area of 624 square feet) and #39 (alternative site for development).

“[T]he separate statement effectively concedes the materiality of whatever facts are included. Thus, if a triable issue is raised as to any of the facts in your separate statement, the motion must be denied!” (Nazir v. United Airlines, Inc., 178 Cal.App.4th 243, 252 (2009), quoting Weil & Brown, Cal. Practice Guide: Civil Procedure Before Trial (The Rutter Group 2009) § 10:95.1, p. 10-35.) Triable issues are raised as to three of City’s facts, which it lists for each issue it wants adjudicated. Therefore, the Court will deny the motion for summary judgment or adjudication.

City brought one motion. It does not articulate a different standard for the motion under CCP § 1260.040(a) for determination of liability for inverse condemnation. Even if the motion within a motion is permissible in an inverse condemnation action, the triable issues of fact apply to the CCP § 1260.040 motion, as well.

4. Conclusion: Because of the existence of triable issues of material fact, the Court denies City of Santa Barbara’s motion for summary judgment or, in the alternative, summary adjudication of issues, or motion for legal ruling.

Emprise’s Cross-Motion for Legal Ruling Imposing Liability on Defendant City Under Inverse Condemnation Pursuant to CCP § 1260.040

Emprise moves for a finding of liability for inverse condemnation because City’s denial of the CDP has deprived it of all economically beneficial use of the property as there are no alternative sites on which to build, a fact Emprise contends City has repeatedly admitted. City opposes the motion. The Court will assume, without deciding, that CCP § 1260.040 applies in an inverse condemnation action.

Per se takings under the Fifth Amendment occur when regulations completely deprive an owner of all economically beneficial use of the property. Lingle v. Chevron U.S.A. Inc., 544 U.S. 528, 538 (2005). “[W]hen the owner of real property has been called upon to sacrifice all economically beneficial uses in the name of the common good, that is, to leave his property economically idle, he has suffered a taking.” Lucas v. South Carolina Coastal Council, 505 U.S. 1003, 1019 (1992). A resolution that implements a moratorium preventing a property owner from building on its property deprives that individual’s land of all economically beneficial use. Monks v. City of Rancho Palos Verdes, 167 Cal.App.4th 263, 270 (2008).

It is undisputed that City denied the CDP, at least in part, because it would not be consistent with Local Coastal Plan (“LCP”) Policy 8.2 prohibiting development on a bluff face, which City determined to be at 127 feet elevation. In its ruling on the writ of mandate, the Court found City’s determination was supported by substantial evidence.

City argues this Court decided there is no evidence of an investment backed expectation that Emprise could develop the property below the 127 foot bluff edge. The Court simply determined, for purposes of the administrative mandate, there was no such evidence in the administrative record. The Court’s review was restricted to the administrative record. SN Sands Corp. v. City & County of San Francisco, 167 Cal.App.4th 185, 191 (2008). The Court did not determine that there is no evidence outside the administrative record that could be offered at the trial of the inverse condemnation causes of action in the complaint. In any event, if a regulation completely deprives the owner of “all economically beneficial use” of the property, the investment-backed expectations of the property owner do not come into play. Monks v. City of Rancho Palos Verdes, supra, 167 Cal.App.4th at 296, citing Lingle v. Chevron U.S.A. Inc., supra, 544 U.S. at 538.

City contends the motion must fail because Emprise has not addressed the possibility of merging 1925 ECDLL with its property at 1921 El Camino De La Luz (“1921 ECDLL”) and developing that consolidated lot. City relies on Murr v. Wisconsin, 137 S.Ct. 1933, 1948 (2017). But the case is inapposite as Wisconsin’s Administrative Code included a merger provision providing that “adjacent lots under common ownership may not be ‘sold or developed as separate lots’ if they do not meet the size requirement.” Id. at 1940. Only in light of this regulation did the U.S. Supreme Court find that “it follows that for purposes of determining whether a regulatory taking has occurred here, petitioners’ property should be evaluated as a single parcel consisting of Lots E and F together.” Id. at 1948. There is no such regulation merging 1925 ECDLL and 1921 ECDLL in evidence here.

Emprise points to instances in which City staff stated that there were no feasible alternative locations above the 127 foot elevation that would satisfy the Coastal Act and LCP policies and avoid a taking. But, at the City Council hearing, there was evidence of a potential area for development with one, two, or three story structures. [Administrative Record 5348:13-5349:15] Those potential developments are problematic, but the present record does not reflect that they are not feasible alternatives that would indicate some economically beneficial use of the property.

On the present record, Emprise has not established that there was a per se taking depriving it of all economically beneficial use of the property. To be clear, as it did in the hearing on the writ of mandate, the Court is only addressing the record before it. This finding does not preclude further evidence at trial.

The Court denies the motion of plaintiff Thomas Felkay, as trustee of the Emprise Trust, for a finding of liability for inverse condemnation under CCP § 1260.040.