Landowners who filed a lawsuit contending that Santa Cruz County's second unit ordinance conflicted with state law should have filed suit when the county most recently amended the ordinance, not when the county applied the ordinance to conditional use permits, the Sixth District Court of Appeal has ruled. The ruling came in a 2-1 decision, with Acting Presiding Justice Patricia Bamattre-Manoukian dissenting. She concluded that a new statute of limitations arose every time the county applied the contested ordinance. The substantive issue in the case was whether Santa Cruz County's ordinance — which limits who may live in second units and what rent can be charged — conflicts with the Costa-Hawkins Rental Housing Act (Civil Code § 1954.50 et seq.). The state law, approved in 1995, limits local rent control efforts. The court hinted that the local ordinance might run afoul of Costa-Hawkins, but neither the majority nor the dissent ever fully addressed the merits of the case. The majority said the lawsuit was too late, and the dissenter urged a remand to the trial court for a decision on the merits. The court also split over the question of whether a potentially invalid ordinance could be challenged anew every time a local government enforced the ordinance. Santa Cruz County first adopted a second unit ordinance in 1981. Over the years, the county has amended the ordinance several times, permitting larger units, reducing the minimum lot size and relaxing occupancy standards. In its most recent form, approved in November 1997, the ordinance restricted second unit occupancy to low-income households, seniors or family members of the landowner. The law also restricted rent based on a sliding scale. In April 1999, Steven Travis applied for a permit to convert a single-family dwelling that was already under construction into a second unit, and to construct a primary dwelling unit on his property in the unincorporated community of Boulder Creek. The county approved the permit subject to the occupancy and rent conditions. Travis appealed the conditions, but he lost. So he filed a lawsuit in September 1999 and was joined by Stanley and Sonya Sokolow. In 1996 and in 1998, the Sokolows had received permits to build second units on two parcels they owned outside the Santa Cruz city limits. They did not administratively appeal the permit conditions but instead protested to the county counsel and the Board of Supervisors that Costa-Hawkins preempted the local ordinance. In their lawsuit, Travis and the Sokolows argued the second unit ordinance was preempted by state law, was discriminatory, violated state planning and zoning law, was an unconstitutional taking and was invalid because of the county's lack of a valid housing element. Santa Cruz County Superior Court Judge Robert Yonts ruled that the landowners' challenge of the ordinance itself was too late, as was the Sokolows' challenge to their particular permit conditions. Judge Yonts found that Travis's constitutional challenge was timely, but that there had been no taking. Acting as their own lawyers, the landowners appealed. The split appellate panel upheld the trial court's decision, although on slightly different grounds. The first question for the court was whether the lawsuit was a "facial" challenge — meaning the entire ordinance was brought into question — or an "as-applied" challenge — meaning only the county's application of the law to the landowners' particular situations was at issue. The landowners said their lawsuit was both. They argued that the ordinance was unlawful, and each time the county enforced the ordinance, it could be contested again. The court ruled that the lawsuit was strictly a facial challenge. "Petitioners do not contend that the conditions attached to their particular second unit permit applications differed in any way from the conditions imposed on other applicants for such permits," Justice William Wunderlich wrote for the majority. "Petitioners' essential claim is that the Ordinance is invalid no matter how, when or to whom it is applied, because state law preempts it." The court then moved on to the question of which statute of limitations applied. The landowners, of course, argued for the longest statute of limitations possible. They also argued that a new time limit commenced every time the county applied the ordinance — a "continuous accrual." The court, however, said the 90-day statute of limitations in Government Code § 65009, subdivision (c) applied. The state law gives those who seek to "attack, review, set aside, void, or annul the decision of a legislative body to adopt or amend a zoning ordinance" 90 days to commence legal action. That was precisely what Travis and Sokolows sought to do, so they should have sued within 90 days of the Board of Supervisors' decision to amend the ordinance in 1997, the court ruled. "The Legislature has enacted short statutes of limitation for attacks on conditional use permits, and for challenges to zoning ordinances that conflict with the governing general plan, as well as for attacks on the adoption or amendment of zoning ordinances," Wunderlich wrote. "[I]t is clear that the Legislature intended that local land use decisions would be reviewed quickly or not at all." And the majority rejected the idea of continuous accrual: "The case before us is governed by a specific limitation statute, § 65009, subdivision (c)." In her dissent, Bamattre-Manoukian wrote that she "cannot accept the result that a local ordinance that may be void due to the preemptive effect of state law is rendered immune from challenge." Giving the landowners 90 days starting with the county's 1997 decision was wrong, Bamattre-Manoukian wrote. First, the amendments approved in 1997 were not the ones the landowners contested, Bamattre-Manoukian noted. The restrictions in question already existed and the county did not change them in 1997. Second, the challenged restrictions "appear to intrude into the area of landlord/tenant relations," she wrote. "Courts have found similar ordinances regulating the users of property to be ‘suspect' as zoning law." She cited City of Santa Barbara v. Adamson, (1980) 27 Cal.3d 123, and Coalition Advocating Legal Housing Options v. City of Santa Monica, (2001) 88 Cal.App.4th, 451. Moreover, Bamattre-Manoukian accepted the argument of continuous accrual. She pointed to the state Supreme Court's decision in Howard Jarvis Taxpayers Assn. v. City of La Habra, (2001) 25 Cal.4th 809 (see CP&DR Legal Digest, July 2001), in which the court found that a new statute of limitations arose every time a city collected a tax under an invalid ordinance that was several years old. "I would apply the same reasoning to our case and find that a cause of action arises, and a corresponding statute of limitations begins, each time the county acts to enforce its ordinance by issuing a permit imposing the challenged conditions," Bamattre-Manoukian wrote in her dissent. The Case: Travis v. County of Santa Cruz, No. H021541, 02 C.D.O.S. 6718, 2002 DJDAR 8391. Filed July 25, 2002. The Lawyers: Steven Travis in pro per. For the county: Dwight Herr, assistant county counsel, (831) 423-5800.