The opinion
Filed 4/15/26
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FOURTH APPELLATE DISTRICT
DIVISION THREE
THE RETAIL PROPERTY TRUST,
Plaintiff and Appellant, G064887
v. (Super. Ct. No. 30-2023-
01311339)
ORANGE COUNTY ASSESSMENT
APPEALS BOARD NO. 1, OPINION
Defendant and Respondent;
COUNTY OF ORANGE,
Real Party in Interest and
Respondent.
Appeal from a judgment of the Superior Court of Orange County,
Nathan R. Scott, Judge. Affirmed. Appellant’s Request for Judicial Notice.
Denied. Respondent’s Request for Judicial Notice. Denied.
Vallejo, Antolin, Agarwal & Kanter, Peter B. Kanter and
Matthew J. Rilla, for Plaintiff and Appellant.
No appearance for Defendant and Respondent.
Leon J. Page, County Counsel, D. Kevin Dunn and Daniel L.
Richards, Deputy County Counsel, for Real Party in Interest and Respondent.
* * *
Plaintiff The Retail Property Trust owns the Brea Mall in the city
of Brea (the property).1 As a result of the COVID-19 pandemic (the
pandemic), access to the property was substantially restricted due to
governmental orders and the Governor’s proclamation of a state of emergency
issued on March 4, 2020 as to all counties. As a result of those restrictions,
plaintiff filed applications with the Orange County tax assessor (the assessor)
seeking tax disaster relief under Revenue and Taxation Code section 170,
2
subdivision (a)(1) (Calamity Applications). Plaintiff sought to have the
property reassessed on the ground it had been damaged as a result of the
pandemic. The assessor summarily denied the Calamity Applications, and in
response to plaintiff’s administrative appeal, respondent Orange County
Assessment Appeals Board No. 1 (the Board) upheld the assessor’s decision.
Plaintiff then sought relief from the trial court. Following a court trial, the
trial court ruled plaintiff was not entitled to relief under section 170(a)(1) as
a matter of law.
We agree with the trial court’s conclusion and affirm the
judgment.
1
The property consists of an approximately 40-acre site with an
enclosed shopping mall and associated improvements.
2
Section 170, subdivision (a)(1), is hereafter referred to as section
170(a)(1).
2
FACTS AND PROCEDURAL HISTORY
I.
BACKGROUND RELATING TO THE CALAMITY APPLICATIONS
During the time period relevant to its Calamity Applications,
plaintiff owned and leased the property. During the 2019–2020 and 2020–
2021 assessment years, plaintiff paid property taxes assessed by the assessor
for its property.
On March 4, 2020, pursuant to Government Code sections 8625
and 8558, subdivision (b), the Governor of California declared the entire state
was in a state of emergency due to the pandemic. As a result, the property
was closed to the public beginning on or around March 19, 2020. Ultimately,
the property was ordered closed for more than 100 days. Even after
restrictions were eased and limited access was allowed, the property was still
subject to significant restrictions on access, operations, occupancy, and use
due to the persistence of the pandemic in the area. According to plaintiff,
such restricted access included, but was not limited to, full and partial
closures of the property; full and partial closures of businesses operating
within the property; restrictions on the number of people allowed on the
property and within businesses that operated on the property; and
restrictions on the operating hours of the property and the businesses
operating within the property.
On March 1, 2021, plaintiff filed the Calamity Applications,
alleging the pandemic had diminished the value of the property. On March
23, 2021, the assessor denied tax relief on the grounds that there was “[n]o
physical damage to property.”
3
II.
ASSESSMENT APPEALS BOARD PROCEEDINGS
On September 22, 2021, plaintiff filed assessment appeal
applications with the Board appealing the assessor’s decision.
The Board determined the hearing should be bifurcated into two
phases. The first phase would address purely legal issues—specifically,
(1) whether the Board has jurisdiction to decide whether the assessor’s
summary denial of a claim for a calamity reassessment under Revenue and
Taxation Code section 170 was improper; and (2) if the Board has
jurisdiction, whether the denial of the Calamity Applications was proper.
On December 8, 2022, following oral argument, the Board
issued written findings on the first phase. It found in favor of plaintiff on the
jurisdictional issue and in favor the assessor on whether the denial of tax
relief was proper. The Board concluded the weight of authority compelled the
conclusion that physical damage is required before relief under section 170
can be granted. The Board also rejected plaintiff’s argument that the COVID-
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19 virus itself could cause indirect physical damage to property.
III.
UNDERLYING TRIAL COURT PROCEEDINGS
On March 2, 2023, plaintiff filed its initial complaint in the
underlying action. Plaintiff’s operative verified first amended complaint, filed
October 2, 2023, was styled as a petition for writ of administrative
mandamus (against the Board), petition for writ of mandate (against the
Board), and complaint for refund of property taxes (against the County of
3
The second phase, which was to determine the amount of
assessment relief to be provided to plaintiff, became unnecessary because of
the Board’s conclusion.
4
4
Orange (the County)). The parties stipulated to a court trial to be conducted
based on briefing and oral argument.
The trial took place on September 25, 2024. Following oral
argument, the trial court orally denied plaintiff’s request for relief on the
merits.5 On September 30, 2024, pursuant to plaintiff’s request, the court
issued a written statement of decision.
As to the merits, the trial court ruled: (1) the California
Constitution allows reassessment only when property is physically damaged
or destroyed; (2) although section 170(a)(1) was intended to and could expand
relief for taxpayers to include “indirect physical damage that causes
restricted access to property—e.g., physical damage to an off-property bridge
or road that restricts access to undamaged property,” the Legislature “cannot
redefine ‘damage’ to eliminate all need for physical damage”; and (3) the
record “does not allow the court to conclude the interpersonal spread of a
virus is the kind of physical damage, direct or indirect, that warrants
reassessment.”
The court entered judgment on November 5, 2024, and plaintiff
appealed.
4
Plaintiff originally filed, but then dismissed, a petition for writ
of mandate against the assessor.
5
The court declined to reach what it referred to as “the myriad
procedural and jurisdictional disputes,” instead electing to decide the case on
the merits.
5
DISCUSSION
I.
STANDARD OF REVIEW
The fundamental issue in this case is whether a property owner
is eligible for reassessment under section 170(a)(1) as a result of mandated
closures of (and restricted access to) its property arising from governmental
orders issued in response to the pandemic or from the existence of the
COVID-19 virus itself. Because that question turns on legal issues of
statutory and constitutional interpretation, our review is de novo. (Slocum v.
State Bd. of Equalization (2005) 134 Cal.App.4th 969, 973–974 (Slocum); see
Neecke v. City of Mill Valley (1995) 39 Cal.App.4th 946, 953 [“The application
of a tax statute to essentially undisputed facts confronts the court with a
pure question of law. [Citations.] In such a case, the court is not bound by the
findings of the trial court and independent review is appropriate”].)
II.
ANALYSIS
We begin with the fundamental principles that “[s]tatutes
inconsistent with our Constitution are void” and “where possible,” courts
must “construe statutes in favor of their validity.” (Slocum, supra, 134
Cal.App.4th at p. 977.) Article XIII, section 15 of the California Constitution
empowers the Legislature to authorize local taxing entities “to provide for the
assessment or reassessment of taxable property physically damaged or
destroyed after the lien date to which the assessment or reassessment
relates.” (Ibid., italics added.) “[P]hysicality has always been a constitutional
requirement, even when not explicitly stated.” (Slocum, at p. 978.)
Plaintiff’s Calamity Applications were made pursuant to Revenue
and Taxation Code section 170, which was adopted by the Legislature to
6
implement article XIII, section 15 of the California Constitution. (Slocum,
supra, 134 Cal.App.4th at pp. 972, 977.) Section 170(a)(1) provides as follows:
“Notwithstanding any other law, the board of supervisors, by
ordinance, may provide that every assessee of any taxable property, or any
person liable for the taxes thereon, whose property was damaged or destroyed
without [his or her] fault, may apply for reassessment of that property as
provided in this section. . . . [¶] To be eligible for reassessment the damage or
destruction to the property shall have been caused by any of the following:
“(1) A major misfortune or calamity, in an area or region
subsequently proclaimed by the Governor to be in a state of disaster, if that
property was damaged or destroyed by the major misfortune or calamity that
caused the Governor to proclaim the area or region to be in a . . . state of
disaster. As used in this paragraph, ‘damage’ includes a diminution in the
value of property as a result of restricted access to the property where that
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restricted access was caused by the major misfortune or calamity.” (Ibid.)
In Slocum, the court analyzed the validity of a property tax
regulation adopted by the Board of Equalization—specifically, California
Code of Regulations, title 18, section 139 (Rule 139)—that purported to
interpret the term “‘damage’” in Revenue and Taxation Code section 170 to
include “‘diminution in the value of the property resulting from a period of
restricted physical access to the property.’” (Slocum, supra, 134 Cal.App.4th
6 The County adopted a local ordinance authorizing property
owners who are subject to property tax assessment and whose property was
damaged or destroyed without their fault to “apply for reassessment of that
property as provided in Revenue and Taxation Code [s]ection 170.” (Orange
County Code of Ordinances § 1-4-52, subd. (a).)
7
7
at p. 973.) The court struck down Rule 139 as unconstitutional, holding
“section 170 implements article XIII, section 15 of the California
Constitution” and “[t]he plain language of this constitutional provision
permits reassessment where taxable property is ‘physically damaged or
destroyed.’” (Slocum, at p. 977.) In other words, Slocum held that to pass
constitutional muster, Revenue and Taxation Code section 170 requires
physical damage as a predicate to relief.
In specifically addressing section 170(a)(1), the subdivision at
issue here, the Slocum court stated: “Airlines also argue that Rule 139
implements and is consistent with section 170, subdivision (a)(1) . . . . [¶] As a
general matter, Rule 139 cannot be justified as consistent with section 170,
subdivision (a)(1) because the rule permits reassessment in the absence of
physical damage, whether direct or, in the case of restricted access, indirect.”
(Slocum, supra, 134 Cal.App.4th at p. 981. italics added.) The court explained
that section 170(a)(1) provides an exception to the general meaning of
“‘damage or destruction’ as implying direct physical injury to the property,
thereby providing limited relief for indirect physical damage.” (Slocum at
p. 978, italics added.)
Plaintiff contends it satisfied the two prerequisites of section
170(a)(1) because (1) the pandemic qualifies as “[a] major misfortune or
calamity, in an area or region subsequently proclaimed by the Governor to be
in a state of disaster” and (2) plaintiff’s property was “damaged” when its
value diminished due to substantial restricted access arising from that
“major misfortune or calamity.” (Ibid.) Plaintiff contends that, although the
7
Rule 139 was promulgated to grant property tax disaster relief
to airlines and airport concessionaires in the wake of the terrorist attacks on
September 11, 2001. (Slocum, supra, 134 Cal.App.4th at pp. 971–972.)
8
Slocum court “did not explicitly define ‘indirect physical damage’ . . . the
Court suggested that relief under Section 170(a)(1)’s ‘restricted access’
provision may apply to property when the ‘major misfortune or calamity’ has
manifested physically within the area of the property—or at least within the
state—thereby restricting access to the property.” (Fn. omitted.)
We disagree. Neither governmental orders restricting access to
property due to the COVID-19 virus nor the virus itself equate to physical
harm to property—either direct or indirect—and plaintiff failed to establish
eligibility for reassessment under section 170(a)(1). (See Another Planet
Entertainment, LLC v. Vigilant Ins. Co. (2024) 15 Cal.5th 1106, 1117
[“physical damage” means distinct, demonstrable, physical alteration to
property]; Wellness Eatery La Jolla v. Hanover Insurance Group (S.D.Cal.
2021) 517 F.Supp.3d 1096, 1106 [“[T]he virus harms human beings, not
property”]; Kazi v. State Farm Fire & Casualty Co. (2001) 24 Cal.4th 871, 887
[“[A] loss of ‘pure rights in property’ is not physical damage or injury to
tangible property”].)
Plaintiff contends that “[a]ny requirement limiting Section
170(a)(1) relief to scenarios where a taxpayer can show that some property
other than their own has suffered direct physical damage would create an
arbitrary and nonsensical requirement with no reasonable basis.” Not so. It is
not difficult to envision a scenario where a property owner’s property
diminishes in value because another property that is not owned by the
property owner was physically damaged from a qualifying major misfortune
or calamity, which in turn resulted in restricted access to the property
owner’s property, even though the property owner’s property was not itself
physically harmed by the calamity.
9
Plaintiff’s proposed interpretation of section 170(a)(1) would be
directly contrary to both the constitutional mandate of physical damage and
the directive to construe statutes, where possible, in a manner that renders
them valid. (Slocum, supra, 134 Cal.App.4th at p. 977.)8
III.
REQUESTS FOR JUDICIAL NOTICE
Both parties filed requests for judicial notice (RJN) in connection
with this appeal. We deny both requests.
A. Plaintiff’s RJN of Legal Opinion Letters
Plaintiff filed its RJN on October 8, 2025—after the County had
filed its responsive brief—requesting judicial notice of two legal opinion
letters pursuant to Evidence Code section 452, subdivision (c), including one
from the Board of Equalization’s legal staff dated November 16, 1992, and
one by the Attorney General’s office dated November 17, 1972 (55
Ops.Cal.Atty.Gen. 412 (1972)). Plaintiff seeks judicial notice of these
documents to respond to arguments raised in the County’s respondent’s brief
regarding a memorandum issued by the Board of Equalization’s chief counsel
on May 22, 2020, which was part of the administrative record, concluding
Revenue and Taxation Code section 170 does not provide relief for the access
restrictions caused by the pandemic.
We deny plaintiff’s request. First, we have found no need to go
beyond the plain language of section 170(a)(1) to ascertain whether plaintiff
8
In light of our conclusion, and for the same reason the trial
court cited, we need not address the County’s contentions that the Board
lacked jurisdiction to hear plaintiff’s appeal and that plaintiff failed to
establish the Governor declared a specific area or region to be “‘in a state of
disaster’” as required under section 170(a)(1). (Italics omitted.)
10
is entitled to relief. The materials therefore are irrelevant to our
determination. Second, these materials were not before the trial court or the
Board, and we do not find plaintiff’s purported reason for not submitting
them earlier (i.e., the County never substantively addressed the Board of
Equalization memo or the authorities cited therein in the trial court) justifies
introducing them now into these proceedings for the first time.
B. The County’s RJN of Legislative Materials Regarding Senate Bill No. 663
The County’s RJN, filed January 22, 2026, seeks judicial notice of
various legislative history documents relating to Senate Bill No. 663 (2025–
2026 Reg. Sess.), which amended Revenue and Taxation Code section 170
effective October 10, 2025—after judgment was entered in the underlying
case. (See Stats. 2025, § 2.) The County contends the legislative history
relating to Senate Bill No. 663 demonstrates that, under the prior version of
the statute (i.e., the version at issue here), a governor’s proclamation of a
state of emergency was not enough to invoke the major calamity relief
provisions of section 170(a)(1). Plaintiff opposes the County’s RJN on several
grounds. It contends the request is an attempt to circumvent rule 8.254(b) of
the California Rules of Court, which governs the procedure by which a party
may inform this court of new authority that was not available in time to be
included in the party’s appellate briefing,9 and the legislative history relating
to Senate Bill No. 663 is not subject to judicial notice under California Rules
of Court, rule 8.252(a)(2)(A) because it is not relevant to the appeal. Plaintiff
9
Rule 8.254 authorizes such notification by letter, which may
provide “only a citation to the new authority and identify, by citation to a
page or pages in a brief on file, the issue on appeal to which the new
authority is relevant.” (Cal. Rules of Court, rule 8.254(b).) “No argument or
other discussion of the authority is permitted in the letter.” (Ibid.)
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disagrees with the County’s argument as to what the legislative history
shows, asserting nothing therein suggests that only a governor’s formal
proclamation of a “state of disaster” (as opposed to a state of emergency)
could trigger a taxpayer’s ability to qualify for relief under the prior version
of section 170(a)(1).
In light of our conclusion that plaintiff was ineligible for
reassessment as a matter of law under section 170(a)(1) based on access
restrictions due to the pandemic, we need not decide whether a governor’s
proclamation of a state of emergency was insufficient during the relevant
time period to invoke the major calamity relief provisions of section 170(a)(1).
The materials for which the County seeks judicial notice are therefore
irrelevant, and the request is denied.
DISPOSITION
The judgment is affirmed. The parties’ requests for judicial notice
are denied. Respondent County of Orange shall recover costs on appeal.
GOODING, J.
WE CONCUR:
MOTOIKE, ACTING P. J.
DELANEY, J.
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