On April 5, 2019, in a case originally filed March 8, 2019, the Second District Court of Appeal certified for publication York v. City of Los Angeles, __ Cal.App.5th __ (Case No. B278254) (2019), an inverse condemnation case filed when the City of Los Angeles approved the construction of an 8,000 square foot home, 1,300 square foot guest house, driveway, swimming pool, tennis court, storage sheds, retaining walls, and “wine caves” on a 40-acre parcel in the Hollywood hills but denied the landowners’ request for approximately 79,000 cubic yards of grading that accompanied the proposed project.
Under the then-applicable version of the City’s grading ordinance, the maximum grading permitted on the property as a matter of right was 3,300 cubic yards. But the ordinance provides the zoning administrator discretion to grant a “deviation” to allow additional grading in excess of the maximum allowed “by-right” if the zoning administrator makes certain required findings.
In 2014, the zoning administrator conducted a public hearing and issued a detailed written decision approving construction of the single-family home and most of the accessory buildings and retaining walls but denied the requested grading. In connection with the denial, the zoning administrator made detailed findings explaining why the 79,0000 cubic yards of grading would conflict with the City’s land use and zoning regulations.
The landowners appealed the zoning administrator’s determination to the City’s Central Area Planning Commission. At the Commission’s hearing, the zoning administrator testified, among other things, that when he issued his decision, he misunderstood the scope of his discretion. But he explained that even if he had correctly understood the scope, he would have made the same decision. The zoning administrator also testified that he had not approved grading in an amount between 3,300 cubic yards and 79,000 cubic yards because the applicants did not present any alternatives to the proposed project. The Commission thus denied the appeal and sustained the zoning administrator’s decision.
The landowners then filed a complaint and petition for writ of mandate. The first cause of action alleged that the City’s action was arbitrary and capricious, and it sought a writ of mandate directing the City to set aside its action and approve the application. The second cause of action, for inverse condemnation, alleged that the City had taken the landowners’ property by depriving them of substantially all economically viable or beneficial uses of the property.
The superior court denied the writ petition, concluding that the City’s findings and decision were supported by substantial evidence, and granted judgment on the pleadings on the inverse condemnation and civil rights causes of action, finding that the matter is not ripe because the plaintiffs did not propose plans of reduced scope that would nonetheless allow the proposed project.
The Court of Appeal affirmed the trial court’s decision, holding that the zoning administrator’s alleged misunderstanding of the scope of his discretion was not prejudicially erroneous because the zoning administrator stated he would have made the same decision regardless. The Court rejected the landowners’ claim that the City’s outright denial of their request for a deviation was an abuse of discretion because it precludes them from building a home of any size on their property, noting that their arguments were based on the assertions of their attorneys, which are argument, not evidence. The Court explained that the City had no duty to present evidence concerning the amount of grading necessary to build a home on the landowners’ property, and the City had a duty to consider any project other than the one the landowners presented to them. Instead, as the applicants for the land use adjustment, the Court held that the landowners bore the burden of demonstrating their entitlement to the adjustment. And the Court rejected the landowners’ claim that the City’s denial of their grading permit is unsupported by the evidence because the landowners ignored most of the zoning administrator’s extensive findings.
Finally, the Court affirmed the trial court’s determination that the City had not rendered a final decision nor precluded all development of the property. Instead, the City granted the landowners permission to build a single-family home, accessory buildings, and retaining walls. And while the City denied the landowners’ request to permit a maximum of 79,000 cubic yards of cut and fill grading, it neither definitively limited them to 3,300 cubic yards of grading nor precluded the landowners from submitting another, more modest, proposal. The Court thus held that the City’s determination cannot be characterized as a “final decision” regarding the application of the zoning ordinance to the landowners’ property and cannot form the basis for a regulatory takings claim.
York is ultimately a straightforward case addressing the requirements of discretionary local development permitting and regulatory takings law. With respect to the former, applicants generally have the burden of proof with respect to any required findings. With respect to the latter, California courts have held that landowners owners bear a “heavy burden” of showing that a regulation as applied to a particular parcel is “ripe” for a takings claim. A landowner owner can show that a final decision has been made for ripeness purposes only when it provides facts that are “clear, complete, and unambiguous showing that the agency has drawn the line, clearly and emphatically, as to the sole use to which the property may ever be put.” In other words, to establish a regulatory taking, an appellant must show that a regulation has in substance taken his property—that is, that the regulation “goes too far.”
Questions? Please contact Bryan W. Wenter, AICP of Miller Starr Regalia.
For more than 50 years, Miller Starr Regalia has served as one of California’s leading real estate law firms. Miller Starr Regalia has expertise in all types of real property matters, including full-service litigation and dispute resolution, transactions, acquisitions, dispositions, leasing, financing, common interest development, construction, management, eminent domain and inverse condemnation, exactions, title insurance, environmental law, and land use. Miller Starr Regalia attorneys also write Miller & Starr, California Real Estate 4th, a 12-volume treatise on California real estate law. “The Book” is the most widely used and judicially recognized real estate treatise in California and is cited by practicing attorneys and courts throughout the state. For more information, visit www.msrlegal.com.