Landowners Need the Final Answer Before Making Claim
Property owners who never filed a development application have no basis for a takings claim, the Fourth District Court of Appeal has ruled. The court also said a landowner whose one application for a specific plan amendment that was rejected also has no takings argument.
The case arose from the City of San Diego's lengthy planning process for the East Elliott community, a former Navy base that the federal government sold during the 1960s. As early as 1981, the city conceded that a 1971 East Elliott community plan was outdated, but the city did not adopt a new one — as part of a Multi-Species Conservation Plan — until 1997.
Still, landowners must get a final determination from the government regarding permissible uses before a taking occurs, no matter what a long-range plan says, the court ruled.
In 1971, San Diego adopted a community plan and zoning for East Elliott that allowed five residential units per acre on 1,380 developable acres. Ten years later, the city said the plan should be updated, but the city did not have the money to do so. City officials invited property owners to retain their own planning consultant. In 1987, a consultant to the East Elliott Property Owners Association (EEPOA) proposed a plan that would have increased the permitted density of development.
City planners and property owners negotiated for five years before the City Council directed staff members to stop processing EEPOA's proposal in January of 1993. Instead, the city began considering siting a landfill in East Elliott, adjacent to an existing county landfill. A few EEPOA landowners then broke away and formed Calprop Corporation. In 1995, Calprop filed an application to amend the East Elliott Plan and an application for a use permit to allow a private landfill. The city dropped its landfill plans and, in 1996, denied Calprop's applications.
In October of 1996, Calprop sued the city to force approval of its project and sought damages for inverse condemnation. A few days later, EEPOA and one individual property owner sued the city for failing to adopt an updated plan and for inverse condemnation. While the lawsuits were pending, the city adopted the MSCP and amended the East Elliott plan, which reduced the level of development permitted under the 1971 specific plan.
San Diego County Superior Court Judge Judith McConnell consolidated the three lawsuits and issued summary judgement for the city. The property owners appealed only the rulings on inverse condemnation.
A unanimous three-judge panel of the Fourth District upheld McConnell's ruling. The court said that the landowners did not have ripe takings claims, they did not qualify for the "futility exception," and they were not entitled to compensation based on the city's slow planning process.
In considering ripeness, the court extensively cited the U.S. Supreme Court's decision in MacDonald, Sommer & Frates v. Yolo County, (1986) 427 U.S. 340, in which the court ruled, "Whether the inquiry asks if a regulation has ‘gone to far,' or whether it seeks to determine if proffered compensation is ‘just,' no answer is possible until a court knows what use, if any, may be made of the affected property. Our cases uniformly reflect an insistence on knowing the nature and extent of permitted development before adjudicating the constitutionality of the regulations that purport to limit it."
The EEPOA and its members worked only toward a specific plan amendment, the appellate court noted. "Because EEPOA and its members have never sought approval for any specific project, let alone one which met the existing plan and zoning requirements for the area, their claim that their property has been taken is not ripe," Justice Patricia Benke wrote. And, she continued, the city's rejection of one application for a landfill "does not by any stretch of the imagination establish that the city will prevent Calprop from developing its land in any economically viable manner."
As for the futility exception to the ripeness doctrine, the court repeated what other courts have said, namely "that the exception is narrow and that it requires some development proposal by the landowner …." None of the landowners has submitted a proposal since the city adopted the MSCP and amended the East Elliott plan. Moreover, the court said, the MSCP specifically contemplates whether the city should allow development or compensate a landowner to prevent construction — a proposition that these landowners never tested.
The slow planning process was not a basis for a takings claim because the city never weighed a specific development proposal, and because the city made a good faith effort at planning for the area and the slow pace was part of the normal government process, the court ruled.
"[I]t is now up to the landowners to present the city with specific plans for their respective parcels and in that manner provide the city with clear choice of permitting development or providing them some form of meaningful compensation," Benke wrote.
Calprop Corporation v. City of San Diego, No. D031965, Ann N. Petersen v. City of San Diego, No. D032263, East Elliott Property Owners Association v. City of San Diego, No. D032642, 00 C.D.O.S. 369, filed January 12, 2000.
For Calprop: G. Steven Andersen, Andersen & Keleher, (310) 546-6662.
For Petersen and EEPOA: Richard C. Wildman Jr., (619) 338-6500.
For San Diego: Anthony Shanley, deputy city attorney, (619) 533-5814.