A landowner may sue the City of Huntington Beach for a temporary taking because of city delays in adopting a Local Coastal Plan and zoning for the property, the Fourth District Court of Appeals has ruled. The city argued that the takings claim of the Mills Land & Water Company was not ripe because Mills never sought a final determination regarding the permissible type and intensity of development. But the appellate court ruled that "[t]he city had an obligation to get its LCP in place within a reasonable time so that Mills could ascertain what potential permitted uses the city would allow." The city took nearly 20 years to complete an LCP acceptable to the California Coastal Commission. The unanimous, three-judge appellate panel overturned the decision of Orange County Superior Court Gary Ryan — who had sustained three demurrers filed by the city — and remanded the case for trial. "Whether Mills's conduct in not taking further steps to force the zoning issues to a final conclusion with the City was reasonable is a factual issue which cannot be resolved on demurrer," wrote Orange County Superior Court Judge Tully Seymour, sitting by assignment to the appellate bench. "Similarly, determining whether the city's delay in processing and adopting its LCP was justified requires an evidentiary record." The case is significant because it appears to open the door to lawsuits from thousands of other landowners in areas that still do not have LCPs, said Mark Rutter, the city's lawyer. About 30% of coastal sections do not have LCPs, even though the Coastal Act required their submission in 1981. The city and Attorney General Bill Lockyer have asked for a rehearing before the full appellate court panel. In the early 1900s, Mills Land & Water purchased 51 undeveloped acres. The land, which lies in a coastal zone, is on the inland side of the Pacific Coast Highway, across from Huntington Beach State Park. In 1965, the state acquired 28 acres from Mills for a freeway. But when the state abandoned its freeway plans, it granted Mills an option to reacquire the property. In 1978, Mills applied to the city for a general plan amendment to allow residential and commercial development. More than a year later, the city denied Mills's application, citing the need to complete a Land Use Plan for the city's coastal section. In following years, the city and Coastal Commission argued over proper use of the Mills land, with the Coastal Commission citing a Department of Fish & Game recommendation that the site be restored as wetlands. By November of 1982, the commission had certified the LUP with the exception of the 51 acres, which became known as the "White Hole." The city then waited until 1986 to adopt a revised LUP that included the White Hole. The plan designated seven acres of the Caltrans parcel for visitor-serving commercial uses, and the other 44 acres for conservation. The Coastal Commission approved this plan in October 1986. But then the city had to change its zoning for the White Hole to reflect the LUP. It was not until April 1990 that the city sent its proposed zoning changes for the While Hole to the Coastal Commission for certification. In the meantime, Mills applied for approval of a light-industrial office project on its 23 acres in July of 1989. The city, however, refused to process the application, saying Mills needed to obtain an amendment to the LUP, which designated the site for conservation. In May of 1992, the Coastal Commission approved the city's zoning change but added a "conservation overlay." The upshot was to designate seven acres of the Caltrans parcel for visitor-commercial development in exchange for protecting the other 44 acres. However, that zoning never became effective because the city did not act on the Coastal Commission's suggested modification within the six-month statutory deadline. Instead, the city waited two years to adopt the zoning proposed by the Commission and to seek the commission's certification. Mills filed its first lawsuit challenging the zoning in December of 1994, while the Coastal Commission was considering the latest submittal from the city. By April of 1996, the city adopted zoning consistent with the Coastal Commission's modifications, ending the long conflict between the city and the commission. The enactment of the zoning mooted Mills's challenge to the validity of the earlier zoning, according to the appellate court. The only issue left was whether Mills was entitled to damages for an unreasonable delay in establishing the zoning — a temporary taking. The city argued that no taking occurred because the city never gave a final rejection to Mills's development plans. But the appellate court said that that argument "is irrelevant given the nature of Mills's claim that the failure of the City to adopt zoning regulations within a reasonable time under which it could submit a meaningful development application constituted a taking." A similar issue arose in Healing v. California Coastal Commission, (194) 22 Cal.App.4th 1158, in which a landowner who wanted to build a house was stuck while Los Angeles County slowly completed a Local Coastal Plan acceptable to the Coastal Commission. "As in Healing, here the City cannot rely on its failure to adopt its LIP (Local Implementation Plan) and attendant zoning to claim Mills's claim is not ripe," wrote Seymour, a former Newport Beach city attorney. The court also suggested that Mills qualified for the "futility exception" to the ripeness doctrine. That narrowly construed exception relieves developers from submitting multiple applications when it is clear the government will approve none of them. The court cited Milagra Ridge Partners, Ltd., v. City of Pacifica (1998) 62 Cal.App.4th, 108. Mills alleged that city planners in 1988 said it would be futile for the landowner to try to change the conservation designation or to apply for permits to develop that portion of the property. The Case: Mills Land & Water Company v. City of Huntington Beach, No. G020490, 99 C.D.O.S. 8005, 1999 Daily Journal D.A.R. 10151, filed September 27, 1999. The Lawyers: For Mills: Arthur Cook and Dean Dennis, Hill, Farrar & Burrill, (213) 620-0460. For Huntington Beach: Mark Rutter, Moore, Rutter & Evans (562) 435-4499.