In a recent unpublished Court of Appeal decision, Downs v. City of Redding (October 30, 2018), the Court took up two distinct issues: (a) whether a contractor’s use of property for construction staging constitutes a taking when such use is not authorized by the agency, and (b) whether "just compensation" requires payment of damages for the taking of a tree.  Both of these issues are common occurrences in many of the projects we work on and while the Court’s holdings may not come as a surprise, they are a good reminder of the fairness and equity courts apply to such issues ...

The California Coastal Act establishes another layer of regulation governing development in the Coastal Zone. Development under the Coastal Act is defined to encompass essentially everything and anything.  For example, under the Coastal Act development includes such things as a lot line adjustment, releasing fireworks on the 4th of July, or putting up a No Trespassing sign.  While there are certain limited exemptions, in most cases individuals undertaking any development in the Coastal Zone must obtain a Coastal Development Permit.  In certain instances, the local agency’s ...

Posted in Events

On November 1, Nossaman Eminent Domain Partner Bernadette Duran-Brown will be Co-Chairing the Southern California Appraisal Institute’s 51st Annual Litigation Seminar.  Additionally, Ms. Duran-Brown will be joined by Brad Kuhn, Chair of Nossaman’s Eminent Domain & Valuation Practice Group, who will be participating in a panel discussion concerning Easement Valuation.

The seminar will be held on Thursday, November 1st, at the Omni Hotel, 251 South Olive Street, Los Angeles.  The event will kick off with registration and breakfast at 7:30 a.m., and will also include luncheon ...

Posted in New Legislation

On August 31, 2018, the California Legislature passed Senate Bill (SB) 901, which addresses a number of wildfire-related items relating to public utilities.  Governor Brown signed the Bill into law on September 21, 2018.

While the bill introduces a series of new changes, it is particularly noteworthy for what it does not include from Governor Brown’s initial June 2018 proposal for wildfire liability reform.  At least for the time being, lawmakers abandoned the most controversial aspect of Governor Brown’s proposal for the bill: modifying California's strict liability ...

When a governmental agency improperly denies a permit application for a new development, and the proposed development is thereby delayed, does this result in a regulatory taking?  As we've seen in some prior cases, such improper governmental actions can trigger liability, but it is uncommon.  A recent Court of Appeal decision, Bottini v. City of San Diego (Sept. 18, 2018), highlights just how difficult it is for a property owner to pursue a regulatory taking due to a delay caused by a city's improper denial of a development application.

Background

Bottini concerns the ...

Posted in Court Decisions

For those of you who have followed Nossaman’s eminent domain blog since the very early days, you’ll recall our coverage of a significant regulatory takings case, Monks v. City of Rancho Palos Verdes.  The 2008 California decision received much press coverage in that it was one of the very few instances where property owners overcame the myriad substantive and procedural obstacles and succeeded under a regulatory takings theory.  Now, ten years later, another group of property owners in Rancho Palos Verdes attempted to pursue a similar regulatory takings claim on the back of ...

Posted in Projects, Valuation

We wanted to provide some timely articles for those of you in the eminent domain and valuation arena.

First, Brad Kuhn, the Chair of Nossaman’s Eminent Domain and Valuation Practice Group, was recently featured on the cover of the July/August 2018 issue of Right Of Way magazine—a publication of the International Right of Way Association.  Brad participated in an Industry Roundtable in the issue on leveraging the right of way professional in today’s fast-paced design-build world.  The  Roundtable examined the critical right of way component in infrastructure projects and how ...

One of the unique things about eminent domain cases is that a set of specific procedural rules govern the admissibility of valuation evidence at trial.  A new unpublished opinion from the Court of Appeal, San Bernardino County Transportation Authority v. Byun, explores some of the many things that can go wrong when a party ignores those procedural rules.

At the outset, I must admit to a personal stake in this one; this was a case I handled, and which I argued at the Court of Appeal on May 17 (that the decision came out so quickly after argument gives some sense of how the Court felt about the ...

Posted in New Legislation

The Federal Energy Regulatory Commission (FERC) recently issued a Notice of Inquiry seeking input on whether to adjust its policies and procedures for reviewing and issuing authorizations for natural gas transportation facilities.  FERC is specifically considering whether it should modify (i) its methodology for determining whether there is a need for a proposed project, (ii) its consideration of the use of eminent domain and landowner interests, and (iii) its evaluation of environmental impacts.  FERC is also considering whether there are ways to improve the efficiency ...

Posted in Court Decisions

Many states have enacted eminent domain reform since the U.S. Supreme Court's 2005 decision in Kelo v. City of New London, which broadly defined "public use" to include the government's acquiring property for another private owner to realize an economic benefit (such as increasing tax revenues).  However, as reported by the Institute for Justice in its 50 States Report Card, many of those reform efforts have been insignificant.  And, despite repeated efforts over the last 13 years, Congress has yet to pass legislation limiting the use of eminent domain for truly ...

Posted in Projects

For years, the College of the Desert has been seeking to acquire the former Palm Springs mall in order to expand its campus to the west valley.  It has been quite a lengthy battle, as the property owner had repeatedly objected to the College's use of eminent domain for the site.  However, last week, the parties finally reached a settlement of the condemnation action, with the College agreeing to pay $22 million for the property -- dramatically more than the $9.6 million the College originally offered to pay.

According to an article in the Desert Sun, the 29-acre property will allow the College ...

When state and local governments impose unreasonable conditions or exactions on private property, owners pursuing a regulatory takings claim often face a maze of procedural obstacles just to have their case heard. I once described these procedural obstacles as resembling Alice's trip through Wonderland, with the parties falling in and out of state and then federal court (instead of a rabbit hole) based on procedural and substantive rules that often seem as logical as the Mad Hatter's recitals at the Tea Party. The reason for this maze stems from (i) a U.S. Supreme Court decision ...

Posted in Court Decisions

As we’ve seen all too many times in California, when local municipalities delay development approvals -- even improperly -- courts are reluctant to find liability under an inverse condemnation cause of action and award temporary damages. While there have been some successful cases (see Lockaway Storage v. County of Alameda (2013) 216 Cal.App.4th 161), those results are the exception, not the rule.  A recent court of appeal opinion, Mahon v. County of San Mateo 2018 Cal. App. Unpub. LEXIS 1483, provides an example of the uphill battle a property owner faces in successfully ...

As any experienced California eminent domain lawyer knows, there is a unique statutory mechanism that allows parties to bring a legal issues motion to secure a court’s ruling on a litany of issues that impact compensation. This statutory right is set forth in Code of Civil Procedure section 1260.040 and reads as follows:

"(a)          If there is a dispute between plaintiff and defendant over an evidentiary or other legal issue affecting the determination of compensation, either party may move the court for a ruling on the issue.  The motion shall be made not later than 60 days before ...

Posted in Events

On Tuesday, March 20, beginning at 11:30 a.m. PT, Chapter One of the International Right of Way Association (IRWA) will be holding a joint luncheon with the Southern California Chapter of the Appraisal Institute at Luminarias Restaurant in Monterey Park, CA. Nossaman’s  Litigation Department Chair and Co-Chair of its Real Estate Practice Group, David Graeler, will serve as the luncheon speaker, providing a presentation entitled Scenarios to Consider Appraising without USPAP. To register, please visit the IRWA Ch. 1 website here.

The International Right of Way Association is a ...

Posted in Events

In January, please join Nossaman LLP Eminent Domain & Valuation Partners David Graeler and Rick Rayl at CLE International’s 20th Anniversary Southern California Eminent Domain Conference, taking place at the DoubleTree Downtown, Los Angeles.  Mr. Graeler will present Introduction to the Eminent Domain Playbook Part II (Post-Filing Activities): The Real Rules on Thursday, January 18, at 9:30 a.m. PT, and Mr. Rayl will present "Recent Legal Developments: 2017-2018" on Friday, January 19, at 8:35 a.m. PT.  Additional leaders in this field will provide valuable insight and ...

Infrastructure projects take years to develop:  the environmental review, funding, design, procurement, and construction of a public project is time consuming in any state, but even more so in California given the strict regulations and oversight any public agency must comply with.  During that lengthy process, private properties situated in the proposed project alignment remain in a state of flux.  When those impacted properties are slated for development, what are the parties to do?

According to an article in the Morgan Hill Times, Council OKs new housing in one of two ...

Posted in Projects

With the passing of California's new gas tax (SB1) earlier this year, local government agencies have come across a new source of funding to complete public infrastructure projects.  According to an article in the Ceres Courier, Caltrans Seeks Comments on Service Road Interchange, the City of Ceres hopes its Service/Mitchell/Highway 99 Interchange project can benefit from the new funds.  As part of the project, Caltrans and the City are planning one of the State's first "diverging diamond" designs, which would add a new interchange at Service Road and modify the Mitchell ...

Posted in Events

This week, Nossaman Eminent Domain Partner Bernadette Duran-Brown will be speaking at the Southern California Appraisal Institute’s 50th Annual Litigation Seminar.

Ms. Duran-Brown will be providing a Summary of Recent Eminent Domain and Valuation-Related Cases. Her presentation will cover the most recent and upcoming legal developments and is essential for anyone involved with public projects or affected by large-scale development in the region.  We will provide a follow-up blog post summarizing Ms. Duran-Brown’s presentation for anyone unable to attend in person.

The ...

Posted in Court Decisions

In the vast majority of cases, when a public agency exercises eminent domain, the only issue in dispute is the amount of just compensation the agency must pay for the property being acquired.  Even in situations where a property owner challenges the agency's right to take, it is typically for procedural reasons that can ultimately be corrected.  However, where a property owner successfully challenges the agency's right to take, the consequences can be significant, as the agency is required to pay the property owner's litigation expenses -- including attorneys' fees, expert fees, and ...

Two of the more complicated issues eminent domain attorneys face are analyzing whether government conduct rises to the level of a taking, and whether the government engaged in precondemnation conduct that gives rise to damages apart from paying just compensation.

Earlier this week, an unpublished California Court of Appeal decision, Dryden Oaks v. San Diego County Regional Airport Authority, grappled with both issues. (See update below.)

In Dryden Oaks, a developer purchased property near the Palomar Airport in Carlsbad.  The property was in an area governed by the San Diego ...

Posted in Valuation

Acquiring a fee interest in property seems to be so out-of-style.  Nearly every linear infrastructure project I work on now involves the acquisition of various types of easements, whether its a typical temporary construction easement, access easement, street/highway easement, or transmission line easement, or a more complicated aerial easement, parking structure easement, or floating easement.  The scope and terms of these easements can have massive ramifications on compensation, and particularly severance damages to impacted properties.  If you're interested ...

Posted in Valuation

Having recently worked on a number of pipeline and transmission line projects, I find the issue of proximity damages to be fascinating.  Does being adjacent to gas pipelines or electrical transmission lines diminish the value of an owner's remaining property?  I have seen studies suggesting nearly every possible conclusion.  If you're interested in this subject, there's a great article that was recently published in the Appraisal Institute's Appraisal Journal, Summer 2017 edition, titled The Effect of High-Voltage Overhead Transmission Lines on Property Values:  A Review of ...

Posted in Court Decisions

It’s a Friday afternoon and I decided to take a quick look at the advance sheets for any newly decided appellate cases involving eminent domain. My search revealed an unpublished decision that came out yesterday (September 7, 2017) called Sacramento Area Flood Control Agency v. Souza, 2017 Cal. App. Unpub. LEXIS 6117. I’ll provide the highlights below.

Facts:

This matter involved an acquisition by the Sacramento Area Flood Control Agency (SACFA) of approximately 2.2 acres of land for the Natomas Levee Improvement Program. The acquisition was needed to widen the levee along ...

Posted in New Legislation

According to an article in the Los Angeles Times, California lawmakers pitch a break from a key environmental law to help L.A. Olympic Bid, Clippers Arena, California lawmakers introduced Senate Bill 789 last week in an effort to exempt from CEQA any rail, bus, or transit project connected to the 2028 Olympics, along with expediting environmental challenges to construction of the Clippers arena in Inglewood.  If passed, SB 789 would streamline such projects as the environmental review process is typically a multi-year undertaking.  The Bill was introduced by Senator Bradford ...

Under inverse condemnation law in California, a public agency is generally strictly liable for physical damage to private property caused by a public improvement.  This means a public agency can be held liable even if the public improvement was properly designed, constructed and maintained.  Rarely is there a question of whether a project constitutes a "public improvement," but in Mercury Casualty Co. v. City of Pasadena (Aug. 24, 2017), the Court of Appeal recently addressed this issue and held that a tree constitutes a work of public improvement for purposes of inverse ...

The City of Oroville (City) has petitioned the California Supreme Court for review of an unpublished Court of Appeal decision, City of Oroville v. Superior Court (2017) 2017 WL 2554447 (Third District), finding the City liable in inverse condemnation for sewage backup into private property even though the owners failed to install and maintain backwater valves on their private property as required by state and local legal authority.  While no published decisions have been issued on this subject, four unpublished decisions in different jurisdictions throughout California over the ...

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The Martins Beach access dispute in San Mateo County continues to make headlines.  As a quick refresher, billionaire venture capitalist Vinod Khosla purchased 90 acres of beachfront property south of Half Moon Bay, and subsequently proceeded to lock the gated entry to Martins Beach, effectively preventing public access to the popular beach.  We've been covering the dispute for quite some time, including the recent introduction of legislation to potentially fund the State Lands Commission's use of eminent domain to acquire an easement for access to the popular beach.

While the ...

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Posted in New Legislation

We've previously reported on the recent passage of Senate Bill 1 (SB 1), The Road Repair and Accountability Act of 2017, which will raise approximately $52 billion in funding over the next 10 years specifically for transportation.  SB1 is now in full swing, and Caltrans is on a fast track to release new grant funding provided under the legislation.

On August 3, Caltrans released for public review and comment the final drafts of the SB 1 Sustainable Communities and Adaptation Planning Grant guides, which will provide more than $270 million in planning grants for local communities ...

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Last week, the United States Supreme Court in Murr v. Wisconsin issued a key regulatory takings decision which creates a new multifactor balancing test to determine whether two adjacent properties with single ownership could be considered a larger parcel.  In a 5-3 decision, the Court found that the properties were a single parcel and because the owners were not deprived of all economically viable uses of their property they could not establish a compensable regulatory taking.

The Murr Family owned two lots adjacent to a river.  A cabin was built on one of the lots, while the other lot ...

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When public agencies analyze a potential public project, they often need to gain access to private property for surveys, testing, and to otherwise investigate whether a particular property is suitable for a planned project.  Often, agencies gain access by talking with the property’s owner and reaching agreement on a right of entry.  But where the owner refuses to allow access, the agency must resort to the courts.  For decades, agencies have followed a set of rules that allow them to obtain a court-ordered right of entry with minimal notice and without most of the formality of a ...

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Posted in Court Decisions

Public agencies own significant amounts of property throughout California and the United States.  Sometimes, those properties are not being put to a public use, and the government acts as a landlord, leasing out property to private entities.  But when the government is ready to put the property to a public use, and it terminates the lease, is there a "taking" of private property triggering the need to pay just compensation?  A recent unpublished Court of Appeal decision, California Cartage Company v. City of Los Angeles, addressed this issue and held that the government's termination ...

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Posted in Court Decisions

In California eminent domain proceedings, a property owner is entitled to the "fair market value" of the property being acquired.  Typically, fair market value is determined by analyzing comparable sales or by utilizing an income capitalization approach.  But every once in a while, there is no relevant market data, in which case the law permits determining compensation "by any method of valuation that is just and equitable."  (Code Civ. Proc., sec. 1263.320.)  A recent court of appeal decision, Central Valley Gas Storage v. Southam, explains when this "just and equitable" valuation ...

Posted in Court Decisions

As we've reported in the past, temporary takings are compensable in California.  But such claims are not easy to prove, particularly when you're dealing with the federal government imposing temporary regulations preventing use of property.  A recent case, Reoforce v. United States, demonstrates some of the hurdles an impacted property owner may face.

In Reoforce, the plaintiff discovered a mineral deposit called pumicite on federal land in Kern County, California.  Believing the deposit had potential value for paint and fiberglass applications, Reoforce submitted a mining ...

Posted in New Legislation

Most Californians agree that our State's transportation system is in dire need of additional funding for additional improvements and repair.  The problem has always been where to secure the necessary funding.  In short, it has become more difficult to rely on the federal government, local and regional transportation agencies have become less reliant on the State, the gas tax has not been raised in years, and vehicles have become more fuel efficient, resulting in more miles traveled by more cars without the incremental increase in funding.  This week is a major turning point to ...

When a business is taken as a result of a public improvement, the business is entitled to seek compensation for, among other things, loss of business goodwill. Typically, this loss is calculated by measuring the business’ before-condition value and comparing to its after-condition value.  This traditional methodology was the cornerstone for business goodwill appraisers to determine just compensation.  Yet late last year, the California Court of Appeal issued a ruling in People ex rel. Dep't of Transp. v. Presidio Performing Arts Found. (2016) 5 Cal. App.5th 190 which may have ...

Posted in Court Decisions

When the California Supreme Court issued its ruling on Property Reserve v. Superior Court, handing a substantial victory to public agencies, we were given three key takeaways:  (1) the Right of Entry statutes (CCP §1245.010 et seq.) are constitutional, (2) the activities the Department of Water Resources sought to undertake are covered by the broad scope of these statues, and (3) if the language of a statute doesn’t match your planned opinion, you can always reform it to match the claimed legislative intent of the statute.

To that last point, the Court’s opinion included its ...

Posted in New Legislation

On February 9, 2017, California Assembly Member Phillip Chen (a Republican from the 55th district) introduced Assembly Bill 408 (AB 408).  You can find a copy of the bill here.  AB 408 is styled as an act to amend Section 1250.410 of the Code of Civil Procedure relating to eminent domain.  There is very little history available on AB 408 and it appears that the next action is for it to be heard in committee on March 12, 2017.  If AB 408 is ultimately approved in its current form, it would radically change the standards by which courts decide whether or not to award litigation expenses in eminent ...

There has been a lot of news lately concerning President Trump’s desire to build a border wall. Many of the articles focus on the efficacy, costs and practical challenges of building the wall.  But the discussions are also starting to move into our world of eminent domain.  An Op Ed piece in the Washington Post  talks about Donald Trump’s Great Wall of Eminent Domain and mentions that 67 percent of the nearly 2,000 border miles constitute private and state-owned lands. The Daily Beast published an article called The Great Wall of Trump Would Be the Ultimate Eminent Domain Horror Show ...

Posted in Court Decisions

Before an eminent domain action is filed, public infrastructure projects involve years of planning, environmental approvals, design, and property negotiations.  During this time, property owners and real estate agents/brokers are often faced with deciding what to disclose about the potential condemnation to prospective tenants when attempting to lease out space.  It is a difficult position to be in, as (i) disclosing too much makes it extraordinarily difficult to find a tenant willing to pay market rents with the looming "cloud" of condemnation, and (ii) disclosing too ...

Posted in Valuation

In a previous post, "What is 'Just Compensation' For Gas Station Acquisitions," we explored various methods for valuing gas stations and car washes in an eminent domain action, including a recommendation by a gas station appraisal firm, Retail Petroleum Consultants, to approach such valuation assignments as "special use properties".  Retail Petroleum has issued another useful article, "Value Trends in Gas Stations and Car Washes," which examines recent trends driving the valuation of such properties in California.

Retail Petroleum explains that because gas stations ...

Posted in Court Decisions

One of the hot issues in eminent domain these days involves the government's efforts to take over privately-run utility companies.  The argument typically is that the government -- which has no profit-making motive -- can run the utility at a lower cost, saving the ratepayers money.   Not surprisingly, the utility companies feel otherwise.

In California, one of the first cases to reach trial on this issue is about to wrap up.  The City of Claremont sought to condemn the Golden State Water Company's assets, and Golden State fought the City's right to take.

In a Court trial (i.e., a trial ...

Posted in New Legislation

With only a few days remaining until one of the most controversial presidential elections in history, there has been little focus on the candidates' plans as it pertains to the future of infrastructure development in America.  But both Hillary Clinton and Donald Trump have big spending plans -- they are just vastly different in their proposals on how funds will be raised and spent.  If you're interested in a detailed breakdown of Clinton's and Trump's infrastructure plans, there is an excellent article by Chuck Devore in Forbes titled "Where Clinton and Trump Stand on Transportation".

Last year, my partner Ben Rubin reported on the California Supreme Court's decision in California Building Industry Association v. City of San Jose, which analyzed an inclusionary housing ordinance and held that such ordinances do not qualify as "exactions" and, consequently, are reviewed under a deferential standard that looked at whether the ordinance was "reasonably related" to the city’s interest in promoting the health, safety, and welfare of the community.

Last month, we saw the first published decision following last year's Supreme Court pronouncement ...

Posted in Valuation

In January, I spoke at a conference in Austin about efforts by municipalities to condemn privately-held utility companies.  At the time, I figured it would be a one-off presentation on a pretty niche issue, even for eminent domain attorneys.  But next month, I'll be speaking on a variation of that topic at CLE International's 2016 Eminent Domain Conference in Las Vegas, a presentation that will be the third time this year I've spoken on the topic.

In fact, we've been following this issue since at least 2014, when my partner Brad Kuhn wrote about a takeover effort involving PG&E.  Those ...

Last summer, I wrote about the Appraisal Institute’s controversial effort to promote legislation in California (known as AB 624) that would enable licensed real estate appraisers performing appraisals for non-federally-related transactions to use any nationally or internationally recognized standard of valuation. I commented at the time that it wasn’t difficult to envision a parade of horribles that might result should appraisers be permitted to identify obscure international standards for an appraisal assignment in order to drive value up or down for a litigant.

Not ...

Posted in Redevelopment

Redevelopment has quite the lengthy history in California.  Yet it has generally been "All Quiet on the Western Front" since redevelopment agencies were abolished in 2011 as part of Governor Brown's plan to fix the state's budget deficit.  Yes, the legislature breathed new life back into redevelopment last year through Community Revitalization and Investment Authorities (CRIAs), but a widespread return seemed unlikely given the safeguards and restrictions put in place -- particularly as to what can constitute "blight" (a term which previously could be interpreted so broadly ...

Last month, the California Supreme Court’s decision in Property Reserve v. Superior Court provided long-awaited certainty for public agencies after a court of appeal determined the often-used right of entry statutes failed to provide adequate Constitutional protection for pre-acquisition investigations and testing.  In summary, the Supreme Court held the right of entry process constitutional, with one reform:  the property owner is entitled to a jury trial on the amount of compensation. 

The decision preserves a significant tool for public agencies to keep their projects on ...

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Posted in Court Decisions

Every year or so, a new appellate court decision comes out addressing the proper role of the judge versus the jury on some certain eminent domain issue. Most recently, a trial court, appellate court and the California Supreme Court all grappled with this question:  Does the judge determine whether a dedication requirement is constitutional, or does the jury?  Yesterday, the Supreme Court issued its decision in City of Perris v. Stamper, No. S213468 (Aug. 15, 2016) holding that it is the role of the judge to determine whether a dedication requirement is constitutional.  The ...

Posted in Projects

For years, we've been working with our public agency clients during the environmental and design-phase to minimize right-of-way impacts with new infrastructure projects.  Yet for many agencies, property acquisitions are an afterthought, as the costs of construction and environmental impacts headline agencies' concerns.  That thought process is slowly beginning to change, as agencies are starting to recognize that right-of-way acquisition can significantly delay projects, resulting in construction delay claims, change orders, loss of project funding, and in ...

California Eminent Domain Report is a one-stop resource for everything new and noteworthy in eminent domain in California. We cover all aspects of eminent domain in California, including condemnation, inverse condemnation, and regulatory takings. We also keep track of current cases, project announcements, budget issues, legislative reform efforts, and report on all major California eminent domain conferences and seminars.

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