Legal Commentary on Planning and Development
Complete physical dispossession of a property is not a prerequisite to an award of damages after a condemnation proceeding is abandoned—moving from the property in reliance on the order granting the agency possession is sufficient. San Joaquin Regional Transit District v. Superior Court, No. C084755 (3rd Dist., Dec. 1, 2020)
In 2010, the San…
The City of Los Angeles was required to offer to sell condemned property back to its original owner because the property had not been used and the City Council did not adopt a resolution reauthorizing the public use until 19 days past the 10-year statutory deadline. Rutgard v. City of Los Angeles, No. B297655…
A recent Court of Appeal decision, Save Mt. Diablo v. Contra Costa County, No. A142357 (First Dist., October 7, 2015), provides guidance concerning the concept of a “division” of land under Subdivision Map Act, clarifying that condemnation of portions of a parcel do not result in subdivision of the remaining private areas.
Background
The Map Act requires a property owner to obtain approval of either a parcel map or a final map in order for property to be sold, leased, or used as collateral for financing. The principal purposes of the Map Act are to ensure the orderly development of land, control the design of improvements, guarantee the completion of public facilities, and protect the public from fraud.
In Save Mount Diablo, the Nunns purchased a tract of agricultural property recorded as a single parcel. The Contra Costa Water District (“CCWD”) had previously condemned two intersecting strips of land across the tract, one for a roadway and the other for a pipeline. The two strips effectively divided the Nunn’s property into four separate parcels.
The Nunns initially pursued approval of a parcel map to legally convert the property into four parcels with one remainder parcel. Save Mount Diablo objected to the application, citing potential environmental impacts from resulting development. The Nunns then abandoned the application, instead requesting certificates of compliance for each of the four parcels separated by the CCWD strips. Under section 66499.35 of the Map Act, a certificate of compliance may be issued upon a determination that property was previously divided consistent with the Map Act and local law. These certificates, if issued, would have allowed the Nunns to sell, lease, or finance the four parcels without obtaining approval of a parcel map.
The Nunns argued that the CCWD condemnation of the strips created a lawful “division” of the property into four discrete parcels and that the Nunns were entitled to certificates of compliance to recognize the prior division. The Contra Costa County Board of Supervisors ultimately agreed and ordered the issuance of the certificates. Save Mount Diablo sued to set aside this decision.
Court of Appeal Analysis
The appellate court first considered whether the Nunns were entitled to certificates of compliance based on a prior “de facto” legal division. While acknowledging that the condemnation created separate fee estates in the various portions of the property, the court determined that condemnation did not divide the property for purposes of the Map Act. It stated that “regardless of whether a piece of property can be characterized as a parcel, it is entitled to a certificate of compliance only if it was the result of a prior division recognized by the Act.” The court reasoned that the mere fact that parts of a property do not touch does not mean that a division has been achieved, and noted that, under the Map Act’s definition of “subdivision,” property may be considered a contiguous unit even if it is separated by roads, streets, utility easements, or railroad rights-of-way.
Continue Reading Condemnation Does Not Result in Subdivision of Remaining Property under Map Act
An agency may acquire the assets of a private utility through condemnation using Mello-Roos bond financing, including intangible property incidental to the real or tangible property being acquired. Golden State Water Co. v. Casitas Municipal Water District, 235 Cal. App. 4th 256 (2015).
Upon petition by the City of Ojai, the Casitas Municipal Water District elected to acquire all of the assets of Golden State Water Company, a private utility, and take over Golden State’s water service in Ojai. Casitas formed a Mello-Roos Community Facilities District (CFD) to finance the purchase, and took steps to acquire the assets through eminent domain. Golden State filed a reverse validation action seeking to invalidate the resolutions forming the CFD and authorizing the bond financing. It argued that Mello-Roos financing cannot be used to finance acquisition of property by eminent domain or to acquire intangible assets such as goodwill and contractual water rights.
The Court of Appeal rejected the challenge, finding no support for the proposition that Mello-Roos cannot be used to acquire property through eminent domain. Observing that the Act states that its provisions shall be liberally construed, the court found that the word “purchase” in the Act connoted acquisition in exchange for compensation regardless of whether the property was being acquired voluntarily. In an acquisition by condemnation, the court noted, the public entity must pay the same price the owner would have received in an arm’s length transaction. Given the obvious practical need in certain circumstances to use condemnation powers, the court concluded that the word “purchase” was properly construed to include taking by eminent domain upon payment of just compensation.
Continue Reading Mello-Roos Financing May Be Used to Acquire a Private Water Utility Through Eminent Domain.
