A city is not liable for damages sustained because it failed to record a notice that a property was in a known landslide zone, despite a city ordinance requiring such recordation, the California Supreme Court has ruled. In a case watched closely by many California cities and counties, the state Supreme Court ruled 6-1 that the City of Los Angeles was not liable when the 1994 Northridge earthquake caused a landslide that destroyed a house in Pacific Palisades. Justices did not dispute landowner Paul Haggis' claim that he would not have purchased the property if the city had recorded the notice of substandard condition. But, the court ruled that the city's failure to record the notice did not violate any duty of care to Haggis because the municipal code was intended to protect general public health and safety. The majority also held that the city was immune from lawsuits arising out of building inspections. Haggis purchased a $2 million-plus home on the Pacific Palisades bluffs in 1991 but apparently was unaware of the property's long history. A city-sponsored study in 1959 found that coastal bluff was vulnerable to landslides, and in 1966 a landslide destabilized part of the property. The city then ordered the owner to vacate the property and stabilize the site, as required by Los Angeles Municipal Code §91.0308(d). But the county failed to record a notice of substandard condition with the county recorder, as mandated by the same code section. In 1970, the city again ordered the landowner to abate the landslide hazard. Later that year, the county issued permits to demolish portions of the existing residence and to rebuild farther from the damaged bluff. At the same time, the city did not demand either an affidavit stating the owner was aware of the unstable conditions, or require a landslide stabilization plan — even though the municipal code required such documents. The city issued several building permits during the 1970s and even allowed Caltrans to remove slide debris as part of a fill project. Still, the city never required geologic studies or recorded the notice of substandard condition. The Northridge earthquake destroyed the house and left the property unusable. Haggis filed suit seeking more than $3.5 million in damages, plus compensation for emotional distress. Los Angeles County Superior Court Judge David Finkel and the Second District Court of Appeal rejected the lawsuit on a demurrer. The hearing before the state's high court drew amicus briefs from 136 cities, the California State Association of Counties, and the state Attorney General. The court ruled that city liability required an obligatory action, not a discretionary or permissive action, and that the obligatory duty must be designed to protect against the kind of injury suffered by the plaintiff. The court ruled that the Municipal Code did not "create a mandatory duty of enforcement," it only authorized the city to use particular enforcement tools. "We agree with the City that the probable purpose of the ordinance's recordation requirement is to encourage the landowner to undertake necessary stabilization work, for if he or she does not do so, a recorded certificate of substandard condition will seriously impair the value of the property for possible sale or security," Justice Kathryn Werdegar wrote for the court majority. "… Municipal Code §91.0308(d) exists to protect the public against unsafe building and land conditions, not to regulate the marketing of real estate." Moreover, Government Code § 818.6 grants local governments immunity for making an inadequate or negligent inspection, the court ruled. "To impose liability for failing to record the result of the inspection would frustrate the purpose of the immunity statute," Werdegar wrote. The inspection immunity was key to other jurisdictions' interest in the case. If governments were liable for inspection errors, they would be greatly discouraged from performing inspections, the cities, counties and Attorney General argued. Justice Stanley Mosk dissented. He said that the city had a mandatory duty that was intended to protect precisely the type of injury Haggis suffered. "The warning that recording provides to potential purchasers and lenders is an integral part of the legislative scheme," Mosk wrote. The Case: Paul Haggis v. City of Los Angeles, No. S074364, 00 C.D.O.S. 1897, 2000 Daily Journal D.A.R. 2611, filed March 9, 2000. The Lawyers: For Haggis: Pamela Schmidt, Berger & Norton, 310 449-1000. For the city: William Waterhouse, assistant city attorney, (310) 732-3750.