A billboard company has lost a lawsuit seeking damages from the City of Los Angeles for planting trees that obstructed visibility of six billboards. The loss of visibility, without loss of access, was not enough to sustain Regency Outdoor Advertising's inverse condemnation claim, the Second District Court of Appeal ruled.
The appellate panel also upheld a lower court's decision to award the city $104,145 in costs, including $83,295 in expert witness fees.
Five years ago, the city planted palm trees and placed lighted pylons on Century Boulevard between the San Diego Freeway and Los Angeles International Airport as part of an airport enhancement project. After Regency rejected a settlement offer - the city offered to remove one tree and pay Regency $1,000 - the company sued the city and its Department of Airports, seeking compensation for lost value.
Los Angeles County Superior Court Judge Jean Matusinka ruled for the city, finding that Regency failed to prove damages. Regency appealed. A unanimous three-judge panel of the Second District, Division Four, agreed with Regency that Judge Matusinka had relied on the wrong legal principals. Still, the appellate panel held that the trial court's ultimate decision was correct.
Matusinka based her decision on People v. Symons, (1960) 54 Cal.2d 855. In Symons, the state Supreme Court ruled that a property owner could not recover damages caused by the construction of a public improvement on an adjoining property. However, according to the Second District, the Legislature in 1975 amended the applicable law by adding Code of Civil Procedure § 1263.420. Subdivision (b) abrogated Symons by allowing recovery for damages regardless of the location of the damage.
The Second District applied the amended statute to this case, but still ruled for the city.
Regency cited a number of cases to support its claim for damages: Williams v. Los Angeles Ry. Co., (1907) 150 Cal. 592; People v. Ricciardi, (1943) 23 Cal.2d 390; People v. Loop, (1954) 127 Cal.App.2d 786; Goycoolea v. City of Angeles, (1962) 207 Cal.App.2d 729; and United Cal. Bank v. People ex rel. Dept. Pub. Wks., (1969) 1 Cal.App.3d 1. Although the cases established that lost visibility could entitle a property owner to payment of damages, none of the cases stood for the proposition that loss of visibility alone mandated the payment of damages, the court ruled
“Some decisions describe the easement of reasonable view as separate from the right of ingress and egress, but none has found substantial impairment of property rights based solely on loss of visibility” Presiding Justice Norman Epstein wrote for the court. “Since the only claimed damage in this case was the impairment of visibility of Regency's billboards, we find no error in the trial court's conclusion that there was no substantial or actionable impairment of Regency's property rights.”
Epstein continued: “This conclusion follows logically from the established law that there is no obligation to compensate a landowner for diminution of property value resulting from highway changes which do not interfere with access, but cause diversion of traffic or circuitry of traffic beyond an intersecting street. (See Goycoolea v. City of Los Angeles, 207 Cal.App.2d 729, 737.) If reduction of a business's value caused by the rerouting of traffic is not compensable, then there is no reason to reach a difference conclusion where the routing remains the same, but the visibility of the business is changed by the planting of trees.”
Regency also pointed to the Outdoor Advertising Act (Business & Professions Code § 5200 et seq.), which prohibits the government from compelling removal of a lawful sign or blocking customary maintenance and use. But the act, the Second District ruled, does not address impairment of visibility. “Since city did not require removal of the signs, or limit their use or maintenance, it had no statutory obligation to compensate Regency,” Epstein wrote.
As for legal costs that the lower court awarded to the city, Regency contended that expert witness costs incurred before a settlement offer was made were not eligible, and that the city did not make the settlement in good faith. The appellate court, however, ruled that Judge Matusinka had discretion to award the costs, and that, because the city successfully defended the lawsuit, the city's settlement offer was reasonable.
Regency Outdoor Advertising v. City of Los Angeles, No. B159255, 05 C.D.O.S. 1482, 2005 DJDAR 1967. Filed February 17, 2005.
For Regency: Michael M. Berger, Manatt, Phelps & Phillips, (310) 312-4000.
For the city: Eduardo Angeles, Los Angeles World Airports, (310) 646-3260.