# Petition for Writ of Certiorari — Long Beach Equities, Inc. v. County of Ventura

> Briefs, arguments, decisions, and more.

URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385010_2279%3A1

## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 1992
- **Citation:** 505 U.S. 1219

## Text

FILED

Sl-10%7¢6 BEC 22 I991

No.

IN THE

Supreme Court of the Gnited States

OCTOBER TERM, 1991

LONG BEACH EQUITIES, INC.,
Petitioner,
VS.
COUNTY OF VENTURA, CALIFORNIA, and
CITY OF SIMI VALLEY, CALIFORNIA,
Respondents.

PETITION FOR WRIT OF CERTIORARI
TO THE CALIFORNIA COURT OF APPEAL
SECOND APPELLATE DISTRICT, DIVISION SIX

PETITION FOR WRIT OF CERTIORARI

MICHAEL M. BERGER PAUL R. HAMILTON

of BERGER & NORTON Counsel of Record

A Law Corporation KAREN J. LEE
1620 26th Street of HAMILTON & SAMUELS
Suite 200 South 4000 MacArthur Boulevard
Santa Monica, CA 90404 Suite 5700
(310) 449-1000 Newport Beach, CA 92660

(714) 752-8600

Attorneys for Petitioner
LONG BEACH EQUITIES, INC.

Lawyers Brief Service * Appellate Brief Printers * (213) 383-4457 * (714) 720-1510

—

“ts
QUESTIONS PRESENTED

This case presents questions which are related to, but
in a broader context than, those already accepted for
review in Lucas v. South Carolina Coastal Council, cert.
granted, no. 91-453, PFZ Properties, Inc. v. Rodriguez,
cert. granted, no. 91-122, and Yee v. City of Escondido,
cert. granted, no. 90-1947.

1. Where land use regulations, adopted for an other-
wise proper municipal purpose, leave the owner of 250
acres of vacant land purchased for residential develop-
ment with no economically viable use and no way to
realize distinct, investment-backed, profit expectations,
has a taking occurred which requires compensation
under the Fifth and Fourteenth Amendments to the U.S.
Constitution?

2. Where local government agencies have made it clear
that development of vacant land will not be permitted
during at least the next decade, making it impossible for
the current owner of the property to have any chance
even to recoup its investment because the costs of carry-
ing the vacant land for that long would be prohibitive, is
the dispute “ripe” for litigation?

3. When the reasons proffered by a municipality for
preventing the use of land are devoid of factual support,
has the landowner been denied substantive due process
of law?

ae
PARTIES TO THE PROCEEDING

The parties are listed in the caption. In trial court
pr ceedings, Marr Ranch Associates, owner of neighbor-
ing property, was also a plaintiff.

RULE 29.1 STATEMENT

Long Beach Equities, Inc. is a wholly owned subsidiary
of Long Beach Servfte Corporation, a holding company
of Long Beach Bank, a state savings bank.

- ill -

TABLE OF CONTENTS

Page

QUESTIONS PRESENTED i

PARTIES TO THE PROCEEDING il

TABLE OF AUTHORITIES Viil

OPINIONS BELOW l

JURISDICTION ]

CONSTITUTIONAL AND
STATUTORY PROVISIONS 2

STATEMENT OF THE CASE 2

REASONS FOR GRANTING THE WRIT 4

-ivV-

INTRODUCTION

I. THERE

A.

There is Confusion in the Lower
Courts About the Meaning of
“Economically Viable Use” of
Property

There is Conflict Among Lower
Courts About Whether Trial of
the Facts is Required to Find That
a Regulation “Substantially Ad-
vances a Legitimate State Inter-
est” or Whether that Finding can
be Made as a Matter of Law

There is Confusion in the Lower
Courts About What This Court
Meant by “Reasonable, Invest-
ment-Backed, Profit Expecta-
tions”

IS NO COHERENT RULE
APPLIED IN THF LOWER COURTS
GOVERNING WHAT IT TAKES TO
ESTABLISH A REGULATORY TAKING

Page

11

14

Il.

Ifl.

IV.

THE COURT BELOW CONTINUED
CALIFORNIA’S REFUSAL TO FOLLOW
THIS COURT’S DECISION IN FIRST
ENGLISH WHEN IT HELD THAT THE
GOVERNMENT’S GOOD INTENTIONS
PRECLUDED ANY FINDING OF A
TAKING

A. The Decision Below Conflicts
With Other Decisions of this
Court

B. The Decision Below is Typical of
California Decisions Since 1987
Which Pay No More Than Lip
Service to This Court’s Seminal
Decision in First English

ARBITRARY AND CAPRICIOUS LAND
USE REGULATIONS — UNRELATED
TO THE PURPOSES SUPPOSEDLY
SERVED BY THEM — VIOLATE PROP-
ERTY OWNERS’ SUBSTANTIVE DUE
PROCESS RIGHTS

THERE IS HOPELESS CONFUSION
THROUGHOUT THE COUNTRY ON
WHAT IT TAKES TO “RIPEN” A
REGULATORY TAKING CASE FOR
LITIGATION ON THE MERITS

Page

18

19

20

21

23

° ¥i -

Page

A. There Are No Rational Rules 25

B. There is No Consistency 25

C. The “Rules” Used Below Are So
Rigid That They Make No Sense
and Ensure the Property Owner

Will Lose 26
CONCLUSION 30
APPENDIX A

UNPUBLISHED OPINION, CALIFOR-
NIA COURT OF APPEAL, SECOND
APPELLATE DISTRICT, DIVISION SIX,

FILED MARCH 15, 1991 Al
APPENDIX B

PETITION FOR REHEARING IS

GRANTED, APRIL 12, 1991 Bl
APPENDIX C

OPINION ON REHEARING, CALIFOR-
NIA COURT OF APPEAL, SECOND
APPELLATE DISTRICT, DIVISION SIX,
FILED JUNE 27, 1991 Cl

- Vii -

Page

APPENDIX D
ORDER MODIFYING OPINION AND
DENYING REHEARING, CALIFORNIA
COURT OF APPEAL, SECOND APPEL-
LATE DISTRICT, DIVISION SIX, FILED
JULY 25, 1991 D1

APPENDIX E
PETITION FOR REVIEW _ DENIED,
CALIFORNIA SUPREME COURT,
FILED SEPTEMBER 26, 1991 El

APPENDIX F
JUDGMENT, SUPERIOR COURT OF
VENTURA COUNTY, FILED JUNE 30,
1989 Fl

- Vili -

TABLE OF AUTHORITIES

Page
Cases

Abbott Laboratories v. Gardner (1967)

387 U.S. 136 24
Agins v. City of Tiburon (1980)

447 U.S. 255 8, 10
Andrus v. Allard (1979)

444 U.S. 51 14
Bateson v. Geisse

(9th Cir. 1988) 857 F.2d 1300 22
Columbia Broadcasting System v.

United States (1942)

316 U.S. 407 24
Connolly v. Pension Benefit

Guaranty Corp. (1986)

475 U.S. 211 14
Dames & Moore v. Regan (1981)

453 U.S. 654 19
First English Evangelical Lutheran

Church v. County of

Los Angeles (1987) 4,5,9, 18

482 U.S. 304 19-21, 23-25, 28, 30
Florida Rock Indus., Inc. v. United States

(Fed. Cir. 1986) 791 F.2d 893 17
Glover v. St. Louis-San Francisco

Ry. Co. (1969) 393 U.S. 324 28

- {1% «

Hadacheck v. Sebastian (1915)
239 U.S. 394

Herrington v. County of Sonoma
(9th Cir. 1987) 834 F.2d 1488

Hodel v. Irving (1987)
481 U.S. 704

Hodel v. Virginia Surface Mining &
Reclamation Assn., Inc. (1981)
452 U.S. 264

Hoehne v. County of San Benito
(9th Cir. 1989) 870 F.2d 529

Hornstein v. Barry (D. C. App. 1987)
530 A.2d 1177

Houghton v. Shafer (1968)
392 U.S. 639

Kaiser Aetna v. United States (1979)
444 U.S. 164

Keystone Bituminous Coal Assn. v.
DeBenedictis (1987)
480 U.S. 470

King v. Smith (1968)
392 U.S. 309

Kinzli v. City of Santa Cruz
(9th Cir. 1987) 818 F.2d 1449

Page

9,15

22, 26

4,14

10, 14

25

17

28

10, 14, 19, 26

4, 8, 10, 14

28

29

Page

Kirby Forest Indus., Inc. v.
United States (1984)
467 U.S. 1 10, 14, 15

Lake Nacimiento Ranch Co. v. San
Luis Obispo County
(9th Cir 1987) 841 F.2d 872 10

Loretto v. Teleprompter Manhattan CATV
Corp. (1982) 458 U.S. 419 14, 19

MacDonald, Sommer & Frates v.
County of Yolo (1986)

477 U.S. 340 10, 14, 25, 26
MacLeod v. County of Santa Clara

(9th Cir. 1984) 749 F.2d 541 16
Maryland Casualty Co. v. Pacific Coal &

Oil Co. (1941) 312 U.S. 270 24
McDougal v. County of Imperial

(9th Cir. 1991) 942 F.2d 668 iZ, 13, 14, 21
Nemmers v. City of Dubuque

(8th Cir. 1985) 764 F.2d 502 17
Nollan v. California Coastal 4,5, 9, 10

Commn. (1987) 483 U.S. 825 14, 20, 24, 30

Northern Westchester Professional Park
Associates v. Town of Bedford (1983)
60 N.Y.2d 492, 458 N.E. 2d 809 17

Orion Corp. v. State (1987)
109 Wash. 2d 621 3.47

-xi-
Page

Park Avenue Tower Associates v.
City of New York
(2d Cir. 1984) 746 F.2d 135 16

Penn Central Transp. Co. v. City of
New York (1978) 438 U.S. 104 8-10, 14

Preseault v. ICC (1990)
494 US. 1 19, 25

Prune Yard Shopping Center v. Robins (1980)
447 U.S. 74 14

P.anch 57 v. City of Yuma (1986)
152 Ariz. 218, 731 P 2d 113 17

Regional Rail Reorganization Act Cases (1974)
419 U.S. 102 19

Rossco Holdings, Inc. v. State (1989)
212 Cal.App.3d 642 25

Ruckelshaus v. Monsanto Co. (1984)
“a The prob-
lem is that this Court has neither defined these terms nor
given guidance to lower courts in determining their meaning.
As the 1980's began, a noted commentator lamented:

“In 1978, the Supreme Court, after 91 years of
producing nearly all the leading police power
taking decisions, essentially gave up. Viewing the
facts of Penn Central ... as presenting a question
of police power takings, the Supreme Court an-
nounced that there was no ‘set formula’ to resolve
the question. Rather, said the Court, different fact
patterns require different approaches for solution.”
(Stoebuck, Police Power, Takings, and Due
Process, 37 Wash. & Lee L. Rev. 1057, 1068
[1980}).

Things haven't changed much, as a more recent survey
concluded:

“{T}his area of the law has not been clarified and
the courts continue to generate contradictory opin-
ions utilizing various aspects of the extant ‘for-
mulas,” none of which have garnered anything
approaching a consensus in the view of bench, bar,
and academe.” (/988 Zoning and Planning Law
Handbook 342 [Gordon, ed., 1988]; emphasis
added.)

4 E.g., Agins v. City of Tiburon (1980) 447 U.S. 255, 260; United
States v. Riverside Bayview Homes, Inc. (1985) 474 U.S. 121, 126;
Keystone Bituminous Coal Assn. v. DeBenedictis (1987) 480 U.S.
470, 485.

; E.g., Williamson County Reg. Plan. Commn. v. Hamilton Bank
(1985) 473 U.S. 172; Penn Central Transp. Co. v. City of New York
(1978) 438 U.S. 104.

Se

Thus, lower courts have generally sought to determine
these issues by doing what judges and lawyers are most
comfortable doing: examining the diminutions in value in
earlier cases which were held not to constitute a taking.®

That creates another problem: the older cases were de-
cided before this Court announced either the concept of
“economically viable use” or the concept of “reasonable,
investment-backed, profit expectations,” not to mention the
rules announced or emphasized in First English Evangelical
Lutheran Church v. County of Los Angeles (1987) 482 U.S.
304 and Nollan v. California Coastal Commn. (1987) 483
U.S. 825. Moreover, the decisions of this Court which
appear in this earlier group were either decided at a sig-
nificantly earlier and less complicated time in land econom-
ics and land use control sophistication, or were decided in
the context of pleadings or proof which did not present the
issue of whether the questioned regulation was confiscatory.

Clarification in the context of today’s realities is not only
warranted, it is sorely needed by ail participants in the
process.

A. There is Confusion in the Lower
Courts About the Meaning of “Econo-
mically Viable Use” of Property

Twelve times in the last decade or so, this Court has noted
that, if a regulation deprives a property owner of the

. E.g., Village of Euclid v. Ambler Realty Co. (1926) 272 U.S. 365;
Hadacheck v. Sebastian (1915) 239 U.S. 394; William C. Haas Co.
v. City of San Francisco (9th Cir. 1979) 605 F.2d 1117.

7 Neither concept appears in land use cases in any court before this
Court’s decision in Penn Central Transp. Co. v. City of New York
(1978) 438 U.S. 104, in which they were first enunciated.

= 2

“economically viable use” of his property, a taking has
occurred.

However, in none of those cases did the Court explain
how to determine economic viability. The phrase was simply
stated and then lower courts were left to shift for themselves.
Lower courts have developed no consistent, or even predict-
able, definition.

Commentators are in accord that chaos is the rule. The
following is typical:

“This virtually standardless inquiry has pro-
vided little predictability for property owners, nor
has it served as a reliable guide for government
action.” (Lawrence, Regulatory Takings: Beyond
the Balancing Test [1988] 20 The Urban Lawyer
389, 400; emphasis added.)?

As the 9th Circuit put it, “... the precise meaning of
‘economically viable use’ of land is elusive and has not been
Clarified by the Supreme Court.” (Lake Nacimiento Ranch
Co. v. San Luis Obispo County [9th Cir 1987] 841 F.2d 872,

. Kirby Forest Indus., Inc. v. United States (1984) 467 U.S. 1, 14;
Agins v. City of Tiburon (1980) 447 U.S. 255, 260; Penn Central
Transp. Co. v. City of New York (1978) 438 U.S. 104, 124; Kaiser
Aetna v. United States (1979) 444 U.S. 164, 174 n. 8; San Diego Gas
& Elec. Co. v. City of San Diego (i981) 450 U.S. 621, 653
(dissenting opinion); MacDonald, Sommer & Frates v. County of
Yolo (1986) 477 U.S. 340; Nollan v. California Coastal Commn.
(1987) 483 U.S. 825; Keystone Bituminous Coal Assn. v. DeBenidic-
tis (1987) 480 US 470; United States v. Riverside Bayview Homes
(1985) 474 U.S. 121; Williamson County Regional Planning Commn.
v. Hamilton Bank (1985) 473 U.S. 172; Hodel v. Virginia Surface
Mining & Reclamation Assn., Inc. (1981) 452 U.S. 264; Schad v.
Borough of Mount Ephraim (1981) 452 U.S. 61.

9 For similar assessments, see, e.g., 1988 Zoning and Planning
Law Handbook 14, 342 (Gordon, Ed., 1988); 1 Williams, American
Land Planning Law (1988 Cum. Supp.] 53.

ee

877) In that case, the absence of standards permitted the
court to ignore testimony that each of the supposedly permit-
ted uses of land had no evonomic value to the property
owner.

Here, while acknowledging the “elusive” nature of the
concept of economic viability (App. C, p 19), and acknowl-
edging that the County zoned the property so as to permit
one home on each 160 acres of land (App. C, p 22), the court
below concluded that no taking occurred. Aside from the
erroneous assertion by the court that LBE could have sought
rezoning to 10 acre parcels (App. C, p ) Vi the possibility
and value of available uses is a question of fact, which can-
not be decided on the pleadings.

The confusion extant in the law permits this sort of result.
Clarity from this Court would be reflected in clarity and
consistency below.

B. There is Conflict Among Lower Courts
About Whether Trial of the Facts is
Required to Find That a Regulation
“Substantially Advances a Legitimate
State Interest” or Whether that Find-
ing can be Made as a Matter of Law

As an alternative, the cases cited above hold that a taking
occurs when a land use regulation fails to substantially ad-
vance a legitimate state interest. There is, however, no lower
court agreement on how to make this determination.

The conflict on this issue is starkly apparent when the
California Court of Appeal opinion in this case is set beside
the nearly contemporaneous decision of the 9th Circuit Court

10 It could not. The County refused to process any such

applications.

«%2.

of Appeals in McDougal v. County of Imperial (9th Cir.
1991) 942 F.2d 668. °

In the case at bench, LBE attacked the County and City
ordinances for, among other things, being unnecessary to
accomplish their stated goals of ensuring that sufficient
facilities were available to support additional housing. The
reason for that was that LBE had already seen to it that
adequate infrastructure was available for far more than the
number of homes it sought to build. Thus, LBE sought a
trial at which it would prove that the ordinances being used
to prevent development of its property failed to substantially
advance a legitimate state interest because infrastructure
already existed to support this development.

The California Court of Appeal refused to permit trial.
Rather, it concluded as a matter of law, without any
evidence, that the governmental prohibitions were necessary.
Rather than examining evidence, the California court dealt in
sweeping generalities like this:

“Local government legislation is constitutional
on its face if it bears ‘a substantial relationship to
the public welfare ...’ and inflicts no irreparable
injury on the landowner. [Citation.].. .

“Both County’s Guidelines and City’s Growth
Management Ordinance satisfy this test. The
County enacted the Guidelines to promote efficient
and effective delivery of community services and
to conserve the resources of County by encourag-
ing urban development to occur wihin cities. The
Guidelines emphasize annexation as a means to
accomplish these purposes.” (App. C, p 11)

In sharp contrast, the 9th Circuit's McDougal opinion
holds that such decisions must be based on a critical exami-
nation of evidence and cannot be made as a matter of law on
a motion to dismiss (the functional equivalent of the demur-
rer rulings in this state court proceeding):

» t%

“The district court held that the McDougals ‘failed
to establish that the County’s actions do not sub-
Stantially advance a legitimate state interest.’
However, they have no obligation to ‘establish’ the
illegitimacy of the County’s motivations on a
motion to dismiss. Likewise, the McDougals
allege that the requirements for a conditional use
permit and a verified ground water model were
impossible to satisfy and did not relate to legiti-
mate concerns of the County, but the district
court’s order gives no consideration to these
charges.

“The legitimacy of the public interest involved,
how much it is furthered by the regulatory actions
at issue, the extent of the public benefit obtained or
expected, and the degree that the McDougals’
property rights and reasonable investment-backed
expectations have been impaired are all factors
which lie at the heart of the takings inquiry. These
things typically cannot be assessed properly with-
out a factual inquiry. ([Citation.]” (942 F.2d at
679-680; emphasis added.)

The decision in the case at bench and McDougal CAN-
NOT both be correct. Either a factual inquiry is needed or
the issue is one of law. This stark conflict is endemic to this
field of the law. Anarchy will continue to reign, with courts
randomly choosing whichever approach will best serve their
desires of the moment, until this Court ends the conflict and
confusion.

oe

C. There is Confusion in the Lower
Courts About What This Court Meant
by “Reasonable, Investment-Backed,
Profit Expectations”

Sixteen times in the last decade or so, this Court has noted
that the question of whether a regulation effects a taking of
private property for public use must be analyzed in terms of
the impact of the regulation on the property owner’s
“reasonable [or distinct] investment-backed expectations.”
In three of those decisions which involved land use regula-
tions, this Court considered the concept of profit or reason-
able return on investment. !

However, in none of those cases, did this Court explain
how the impact on a property owner’s profit expectations was
to be considered. It was simply said, and then left un-
elaborated. As a result, lower courts — as well as all par-
ticipants in the land use process — have little guidance.
While they have been told that the expectation must be more

11 Penn Central Transp. Co. v. City of New York (1978) 438 U.S.
104; Andrus v. Allard (1979) 444 U.S. 51; Kaiser Aetna v. United
States (1979) 444 U.S. 164; PruneYard Shopping Center v. Robins
(1980) 447 U.S. 74; Hodel v. Virginia Surface Min. & Recl. Assn.
(1981) 452 U.S. 264; Loretto v. Teleprompter Manhattan CATV
Corp. (1982) 458 U.S. 419; Kirby Forest Indus., Inc. v. United
States (1984) 467 U.S. 1; Ruckelshaus v. Monsanto Co. (1984) 467
U.S. 986; United States v. Locke (1985) 471 U.S. 84; Williamson
County Reg. Plan. Commn. v. Hamilton Bank (1985) 473 U.S. 172;
United States v. Riverside Bayview Homes, Inc. (1985) 474 U.S.
121; Connolly v. Pension Benefit Guaranty Corp. (1986) 475 U.S.
211; MacDonald, Sommer & Frates v. County of Yolo (1986) 477
U.S. 340; Keystone Bituminous Coal Assn. v. DeBenedictis (1987)
480 U.S. 470; Hodel v. Irving (1987) 481 U.S. 704; Nollan v.
California Coastal Commn. (1987) 483 U.S. 825.

12 Penn Central, 438 U.S. at 136; Williamson County, 473 U.S. at
200; Keystone, 480 U.S. at 496, 501.

« 48.

than a “... unilateral expectation or an abstract need ...”
(Ruckelshaus v. Monsanto Co. [1984] 467 U.S. 986, 1005)
and that the concept has its basis in ideas of “.. . justice and
fairness ...” (Kirby Forest Indus., Inc. v. United States
[1984] 467 U.S. 1, 14), this Court has given little more.

The Court has not yet taken the opportunity either to
reconcile its general formulation of “reasonable, investment-
backed expectations” with earlier cases emanating either
from the Court itself or from influential lower courts or to
overrule any of the earlier cases. It is time for the Court to
let the citizens of this country know whether it is serious
about its protection against regulatory takings and, if so, how
that protection is to be achieved.

For example, in Village of Euclid v. Ambler Realty Co.
(1926) 272 U.S. 365, the regulation diminished the value of
the property by 75%. In Hadacheck v. Sebastian (1915) 239
U.S. 394, the regulation diminished the value of the property
by 88%. And in what may be the most eggregious example,
the regulation in William C. Haas Co. v. City of San Fran-
cisco (9th Cir. 1979) 605 F.2d 1117, diminished the value of
the property by 95%. No taking was found in any of these
cases. Both Euclid and Hadacheck were decided before this
Court’s series of cases during the last decade introduced the
“expectations” test. Haas never discusses the test. Nonethe-
less, each of the older cases is now cited by lower courts to
demonstrate that regulations far more onerous than the one
being litigated have been upheld. (See, e.g., App. C, pp
19-22, 25.)

But can these earlier cases be so routinely relied on to
determine if there has been a taking? What light is shed on
the older cases’ validity by the more recent decisions of this
Court? Can the older cases continue to be uncritically used
as benchmarks for how far regulation may diminish property
without compensation? How does leaving the property
owner with 5% of the value of his land (or 12%, or even
25%) comport with “reasonable, investment-backed, profit

a”

expectations” or “economically viable use?” When that
question is posed to a lay audience, the universal response is
either groans or nervous laughter.

As a consequence, commentators agree that there is no
standard which the lower courts believe they can apply. The
result is total unpredictability:

“Investment Backed Expectations.’ This is an-
other phrase which has recently been adopted and
repeated widely. Again, it is difficult to know what
to make of it... The state courts have struggled
for a long time over the same question... Close
analysis of these cases indicates that there is no
consensus in the vast body of state law on this
point; it is an area of almost pure gut juris-
prudence.” (1 Williams, American Land Planning
Law [1988 Cum. Supp.] 54-55; emphasis added.)!3

Neither regulators nor property owners are able to predict
with any degree of confidence the outcome in a specific case.
Thus, numerous cases are litigated which might otherwise be
resolved short of the courthouse. Fundamental Constitu-
tional protections deserve more identifiable road signs than
that.

Notwithstanding this Court’s repeated employment of the
“profit expectations” concept, however, lower courts are in
conflict on whether even to accept the notion of profitability
as a factor to consider in determining whether a taking has
occurred. The Second Circuit and the Ninth Circuit have
flagrantly flaunted their rejection of the idea,!* while the

13 For similar reactions, see, e.g., Mandelker, /nvestment-Backed
Expectations: Is There a Taking? (1987) 31 J. Urb. & Contemp. L.
3; Peterson, Land Use Regulatory “Takings” Revisited: The New
Supreme Court Approaches (1988) 39 Hast. L. J. 335, 345.

si E.g., Park Avenue Tower Associates v. City of New York (2d
Cir. 1984) 746 F.2d 135; William C. Haas Co. v. City of San
Francisco (9th Cir. 1979) 605 F.2d 1117; MacLeod v. County of
Santa Clara (9th Cir. 1984) 749 F.2d 541.

Eighth Circuit, the Eleventh Circuit, the Federal Circuit, and
the highest courts of New York, Washington, Arizona, and
the District of Columbia have expressed a willingness to
determine from the evidence -whether the uses permitted
by the regulation permit the owner to obtain a reasonable
return.

Here, the Court of Appeal acknowledged the “consi-
derable controversy” over whether to examine profit expecta-
tions (App. C, p 23), but concluded — again, as a matter of
law, without evidence — that LBE could not even raise the
issue (App. C, pp 24-25).

The question is: what needs to be alleged? LBE alleged
facts showing that it had worked long and hard with both the
County and the City to develop plans which were acceptable
to the regulators, received assurances from the regulators
that the project was acceptable, and then — after the expen-
diture of millions of dollars in reliance — the regulators
decided to preclude development. LBE seeks only the
chance to present its case to a trier of fact. Those facts show
sufficient interference to warrant trial.

15 E.g., Florida Rock Indus., Inc. v. United States (Fed. Cir. 1986)
791 F.2d 893; Northern Westchester Professional Park Associates v.
Town of Bedford (1983) 60 N. Y. 2d 492, 458 N.E. 2d 809; Orion
Corp. v. State (1987) 109 Wash. 2d 621, 642 (“present, possible, and
reasonably profitable use”); Ranch 57 v. City of Yuma (1986) 152
Ariz. 218, 731 P 2d 113 (“reasonable return on the property”);
Hornstein v. Barry (D. C. App. 1987) 530 A.2d 1177 (“reasonable
financial return”); Wheeler v. City of Pleasant Grove (11th Cir.
1987) 833 F.2d 267, 271 (“... the landowner’s loss takes the form
of an injury to the property’s potential for producing income or an
expected profit”); Nemmers v. City of Dubuque (8th Cir. 1985) 764
F.2d 502, 504-05 (reasonable return on the difference in value with
and without the offending regulation).

II.

99

(MacLeod, supra, at p. 548, quoting Penn Central,
supra, at p. 130.) The Fifth Amendment “is not a
panacea for less-than-perfect investment or business
opportunities.” (/d., at p. 549.)

-C 26-

Regardless of how we analyze RIBE, we come up
with the same conclusion — LBE has not stated facts
which support recovery for inverse condemnation as a
matter of law.

Due Process

LBE’s due process allegations are conclusional and
premature. (Kinzli v. City of Santa Cruz, supra, 818
F.2d at p. 1456, citing the Supreme Court in Williamson
Planning Comm’n v. Hamilton Bank, supra, 473 U.S. at
p. 199.)

Even if a Fifth Amendment takings claim could
arguably be recast as one sounding in substantive due
process, it would be premature. (Kinzli v. City of Santa
Cruz, supra, 818 F.2d at p. 1456.) And, there can be no
denial of procedural due process, under the Fourteenth
Amendment, until the substantive due process claim is
ripe. ([bid.)

An ordinance that is reasonable related to the public
welfare of the population it significantly affects is
constitutional. (Associated Home Builders Etc., Inc. v.
City of Livermore, supra, 18 Cal.3d at pp. 606-607; also
see McMillan v. Goleta Water Dist. (9th Cir. 1986) 792
F.2d 1453, 1457.) The Guidelines and the Growth
Management Ordinance are reasonably related to the
public welfare. -

ys

Equal Protection

LBE alleges that defendants have arbitrarily set aside
its property as open space, whereas comparable property
in the County has not been similarly restricted.

Absent the allegation of the invasion of fundamental
rights or the existence of a suspect classification, there is
no violation of equal protection unless the classification
bears no rational relationship to a legitimate state inter-
est. (McMillan v. Goleta Water Dist., supra, 792 F.2d at
p. 1456; Pennell v. San Jose (1988) 485 U.S. 1, 14,
citing Vance v. Bradley (1979) 440 U.S. 93.) This is
true even if some discrimination is alleged. (McMillan,
supra, at p. 1456.)

As with the due process cause of action, the claim
here is not ripe. LBE’s second amended complaint,
proffered as a motion for reconsideration, provided more
specific allegations concerning owners of other property
who have allegedly been treated more equitably. Even
if the trial court had allowed the second amended com-
plaint to be filed, it would still be subject to demurrer
absent LBE’s filing a proper application.

Civil Rights

LBE’s allegation that it has been deprived of due
process, equal protection and just compensation in
inverse condemnation under color of state law, pursuant
to title 42 United States Code sections 1983 and 1988, is
not ripe because there has been no final decision on
meaningful applications. (See Williamson Planning
Comm’n v. Hamilton Bank, supra, 473 U.S. at pp.
187-188.)

-C 28-

Conspiracy

LBE alleges a conspiracy among the defendants to
perform the activities previously alleged. There is no
separate cause of action for civil conspiracy apart from
overt acts done in furtherance of activities which are
legally compensable. (Widdows v. Koch (1968) 263
Cal.App.2d 228, 234; and see Escamilla v. City of Santa
Ana (C.D.Cal. 1985) 606 F.Supp. 928, regarding 42
U.S.C. §1983 allegations.) Because we find LBE has
not alleged any actionable activities, we hold that there
is no actionable conspiracy.

Relief by Writ, Injunction and Declaratory Relief

Because there is no basis in law or equity to grant
relief under the facts alleged, there is no ground upon
which we can grant relief by way of writ, injunction or
declaration.

LBE has sued City and County because of disap-
pointed expectations concerning its development plans.
LBE states no cause of action even if it has expended
substantial sums on infrastructure and _ preapproval
planning, and even though there will be some delay in
bringing some development proposal to fruition. These
expenditures and delays are the normal incidents of
development projects and are not actionable, per se.

We affirm the judgment as to County.

As to City’s petition, let a writ of mandate issue to
compel the trial court to enter a new and different order
sustaining City’s demurrer in its entirety without leave
to amend. Costs to City and County.

-C 29-

CERTIFIED FOR PUBLICATION

GILBERT, Acting P.J.

We concur:

YEGAN, J.

ABBE, J.”

” Retired Associate Justice of the Court of Appeal sitting under
assignment by the Chairperson of the Judicial Council.

-C 30-

Bruce A. Thompson, Judge
Superior Court County of Ventura

Hamilton & Samuels and Paul R. Hamilton, Karen J.
Lee and Deborah M. Rosenthal, for Plaintiff, Appellant
and Real Party in Interest Long Beach Equities, Inc.

James L. McBride, County Counsel, Dennis L.
Slivinski, Assistant County Counsel, for Defendant and
Respondent, County of Ventura.

John Torrance, City Attorney, Marjorie Baxter,
Assistant City Attorney; Freilich, Stone, Leitner &
Carlisle and Katherine E. Stone and Margaret A. Sohagi,
for Defendants, Respondents, and Petitioners City of
Simi Valley and City Council of The City of Simi
Valley.

No appearance for Respondent Superior Court of the
County of Ventura.

Baker & McKenzie and Robert H. Philibosian, for
Real Party in Interest Marr Ranch Associates, Inc.

Burke, Williams & Sorensen and J. Robert Flandrick,
Virginia R. Pesola as Amici Curiae on behalf of Peti-
tioner City of Simi Valley.

Pacific Legal Foundation and Ronald A. Zumbrun,
Edward J. Connor, Jr., Timothy V. Kassouni as Amici
Curiae on behalf of Real Party in Interest Long Beach
Equities, Inc.

-C 31-

OFFICE OF THE CLERK
COURT OF APPEAL
STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT
ROBERT N. WILSON, CLERK

DIVISION: 6

Hamilton & Samuels

Karen J. Lee

4000 Macarthur Blvd.

Suite 5700

Newport Beach, CA. 92660

RE: Long Beach Equities, Inc.
VS.
Ventura, County of

2 Civil BO045047
Ventura No 103364

-D 1-

CERTIFIED FOR PUBLICATION
[NO CHANGE IN JUDGMENT]

IN THE COURT OF APPEAL
OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT

DIVISION SIX

COURT OF APPEAL-SECOND DIST.
FILebD
JUL 25 1991
ROBERT N. WILSON, Clerk

Deputy Clerk

LONG BEACH EQUITIES, INC., etc.,
Plaintiff and Appellant,

Vv.

COUNTY OF VENTURA, et al.,
Defendants and Respondents.

2d Civil No. B045047
(Super. Ct. No. 103364)
(Ventura County)

THE CITY OF SIMI VALLEY, et al.,
Petitioners, ..

Vv. ad

SUPERIOR COURT OF THE

COUNTY OF VENTURA,
Respondent.

LONG BEACH EQUITIES, INC., et al.,
Real Parties in Interest.

No. B046558

2 2,

ORDER MODIFYING OPINION
AND DENYING REHEARING

THE COURT:

It is ordered that the opinion on rehearing filed here-
in on June 27, 1991, be modified in the following
particulars:

il. On page 25, lines 3 and 4, delete the words
“tentative tract map” and replace them with the follow-
ing words: “specific plan”.

There is no change in the judgment.

Long Beach Equities, Inc.’s petition for rehearing is
denied.

EXHIBIT E

7 he fe dad 5 lees bode

oF i-

Second Appellate District,
Division Six,
No. B045047 / BO46558
$022332

IN THE SUPREME COURT
OF THE STATE OF CALIFORNIA

IN BANK

SUPREME COURT
FILED
SEP 26 1991
Robert Wandruff, Clerk

Deputy

LONG BEACH EQUITIES INC.,
Appellant

Vv.
COUNTY OF VENTURA EtAl.,
Respondents

And Companion Cases

Petition for review DENIED.

The request for an order directing depublication of the
opinion is denied.

LUCAS
Chief Justice

EXHIBIT F

ae
ors

, , anemones Ayes
o oe ee y
PLE

. - meee Sy NEC ICEE
- Sense
~ m= = ih te cae Se .
a . : om _ aro
. . oa -
. A mela

-F 1-

SUPERIOR COURT OF CALIFORNIA
COUNTY OF VENTURA

FILED
JUNE 30 1989
Richard D. Dean, County Clerk

Deputy

LONG BEACH EQUITIES, INC., a
California corporation; MARR RANCH
ASSOCIATES, INC., a California corporation,
Petitioners and Plaintiffs,
vs.
COUNTY OF VENTURA; BOARD OF
SUPERVISORS OF THE COUNTY OF
VENTURA; PLANNING COMMISSION
FOR THE COUNTY OF VENTURA;
THE CITY OF SIMI VALLEY;
THE CITY COUNCIL OF THE CITY
OF SIMI VALLEY, DOES 3 through 50,
Respondents and Defendants.

No. 103364

JUDGMENT FOLLOWING THE COURT’S
SUSTAINING WITHOUT LEAVE TO
AMEND THE DEMURRER- OF_ THE
COUNTY OF VENTURA, THE BOARD OF
SUPERVISORS OF THE COUNTY OF VEN-
TURA, AND THE PLANNING COMMISSION
FOR THE COUNTY OF VENTURA TO THE
FIRST AMENDED PETITION FOR WRIT OF
MANDATE AND AMENDED COMPLAINT
AND SUPPLEMENTAL COMPLAINT

¥ 2.

On May 5 and May 25, 1989, there came on for
hearing in courtroom 44 of the above-entitled court the
demurrer of the County of Ventura, the Board of Super-
visors of the County of Ventura, and the Planning
Commission for the County of Ventura to the First
Amended Petition for Writ of Mandate and Amended
Complaint and Supplemental Complaint. Dennis L.
Slivinski, Assistant County Counsel, appeared on behalf
of the demurring parties. Paul R. Hamilton and Karen J.
Lee of Hamilton and Samuels appeared on behalf of
Long Beach Equities, Inc., and Robert H. Philibosian of
Baker and McKenzie appeared on behalf of Marr Ranch
Associates, Inc. Marjorie Baxter, Assistant City Attor-
ney for the City of Simi Valley, and Deborah J. Fox and
Katherine E. Stone of Freilich, Stone, Leitner & Carlisle
announced that they were appearing as observers on
behalf of the City of Simi Valley and the City Council of
the City of Simi Valley.

The court read and considered respondents’ demurrer
to the first amended petition and memorandum of points
and authorities in support thereof, petitioners’ memoran-
dum of points and authorities in opposition to defen-
dants’ demurrer, respondents’ reply, petitioners’ sup-
plemental opposition and responuents’ supplemental
reply. The court also heard and considered oral argu-
ment of counsel.

The court has taken judicial notice of the following
documents:

1. Resolutions of the Ventura County Board of
Supervisors of August 12, 1969; March 30, 1976; and
February 12, 1985, adopting the Guidelines for Orderly
Development.

2. The land use maps dated September 15, 1981;
April 17, 1984; and May 24, 1988, showing the property
which is the subject of this litigation to be designated
Open Space. The outline of the subject property appear-

it

ing on the certified copies of the land use maps is based
on the diagram on the aerial photograph attached as
Exhibit A to the First Amended Petition/Complaint.
Counsel have stipulated that the clearer copies of these
maps are found at Exhibit 2 of the First Request for
Judicial Notice filed November 28, 1988.

3. A map based on official Assessor’s parcel maps of
the subject property showing current zoning adopted by
the Ventura County Board of Supervisors.

4. Ventura County Ordinance Code sections 8105-0
to and including 8105-4.

5. Resolution of the Ventura County Board of Super-
visors, dated March 3, 1970, designating the governing
body of the City of Simi Valley as the Board of Direc-
tors of the Simi Valley County Sanitation District.

6. Resolution of the Ventura County Board of Super-
visors, dated June 14, 1977, designating the governing
body of the City of Simi Valley as the governing body of
the Ventura County Waterworks District No. 8.

7. Maps showing the boundaries of Ventura County
Waterworks District No. 8 and Simi Valley County
Sanitation District.

8. A staff'report regarding Parcel Map Waiver No. 98
and a Notice of Approval of Parcel Map Waiver, three
pages of the June 1987 Land Use Element of the Ventura
County General Plan, Resolution No. 222 of the Board
of Supervisors and seven pages of the City of Simi
Valley’s General Plan. These four items were attached
as Exhibits A through D to petitioners’ supplemental
opposition to the demurrer filed May 4, 1989.

9. The form and content section of the Ventura
County General Plan Land Use Element attached as
Exhibit 1 to the respondents’ supplemental reply filed
May 15, 1989.

-F 4-

Based on material facts alleged in the First Amended
Petition, which the court has assumed to be true for
purposes of ruling on the demurrer, and on the matters of
which the court has taken judicial notice, the court
sustains the demurrer without leave to amend as to all
alleged causes of action on the ground that they do not
allege facts sufficient to constitute a cause of action
against the demurring defendants/respondents.

With regard of the alleged denial of equal protection,
the court has considered the representations of counsel
for petitioners that he would amend to allege several
developments approved in the unincorporated area which
have features similar to petitioners’ proposed develop-
ment, such as Lake Sherwood, Rancho Matilija, Oak
Park, and the proposed Franciscan project. However, the
addition of these alleged similarities would not be
sufficient to overcome a significant difference in that
petitioners’ proposed development would be provided
urban services, particularly sewer and water, from
entities under the jurisdiction and control of the City
Council of the City of Simi Valley. This, in the court’s
view, is a sufficient rational basis to require annexation
as a condition of the development of petitioners’ project.

Having sustained the demurrer without leave to
amend as to all alleged seven causes of action of the
First Amended Petition, the court hereby dismisses the
First Amended Petition for Writ of Mandate and
Amended Complaint and Supplemental Complaint as to
the defendants County of Ventura, Board of Supervisors
of the County of Ventura and the Planning Commission
for the County of Ventura.

IT IS SO ORDERED.
Dated JUN 30 1989

/s/ Bruce A. Thompson
Judge of the Superior Court

-F 5-

Jobn Torrance, City Attorney
Marjorie A. Baxter

Assistant City Atatorney

City of Simi Valley

2929 Tapo Canyon Road

Simi Valley, California 93063
(805) 583-6700; and

Freilich, Stone, Leitner & Carlisle
Katherine E. Stone

Deborah J. Fox

11755 Wilshire Boulevard, Suite 1230
Los Angeles, California 90025
(213) 444 7805

Attorneys for Respondents / Defendants
City of Simi Valley, et al.

SUPERIOR COURT OF CALIFORNIA
COUNTY OF VENTURA

FILED
NOV 22 1989
Sheila Gonzalez, Superior Court
Executive Officer and Clerk
By , Deputy

LONG BEACH EQUITIES, INC., a

California corporation; MARR RANCH

ASSOCIATES, INC., a California corporation,
Petitioners and Plaintiffs,

vs.

COUNTY OF VENTURA; BOARD OF

SUPERVISORS OF THE COUNTY OF

VENTURA; PLANNING COMMISSION

OF THE COUNTY OF VENTURA;

THE CITY OF SIMI VALLEY;

THE CITY COUNCIL OF THE CITY

OF SIMI VALLEY, DOES 3 through 50,
Respondents and Defendants.

-F 6-
CASE NO. 103364

ORDER RE CITY’S DEMURRER TO
FIRST AMENDED PETITION AND COMPLAINT

CITY OF SIMI VALLEY and CITY COUNCIL OF
SIMI VALLEY’S (“City’s”) demurrer to the first
amended petition and complaint came on for hearing on
October 26, 1989 before the Honorable Bruce A.
Thompson, Judge of the Superior Court, Marjorie Bax-
ter, Assistant City Attorney, and Freilich, Stone, Leitner
& Carlisle by Katherine E. Stone appearing for defen-
dant and moving party City; Hamilton and Samuels,
Karen J. Lee appearing for plaintiff Long Beach Equi-
ties; no appearance for plaintiff Marr Ranch Associates.

The court having reviewed the papers submitted,
taken judicial notice of the documents submitted by the
City, and considered the arguments of counsel rules, and
orders as follows:

1. The demurrer is sustained without leave to amend
as to the third (Discrimination in Application in Zoning
and Land Regulation, Denial of Equal Protection of
Law), fourth (Deprivation of Civil Rights) and fifth
(Conspiracy to Deprive Plaintiffs of Civil Rights) causes
of action and the third, fourth and fifth causes of action
are hereby dismissed.

2. The seventh cause of action (Petition for Writ of
Mandate Against County Defendants) is not applicable
to the City. The demurrer of the County defendants
having been previously sustained without leave to amend
the seventh cause of action is hereby dismissed.

3. The demurrer is overruled as to the first (Inverse
Condemnation), second (Denial of Substantive and
Procedural Due Process of Law) and sixth (Declaratory
and Injunctive Relief) causes of action.

x oP

4. City defendants to answer on or before November
17, 1989.

Dated: NOV 22 1989

BRUCE A. THOMPSON
BRUCE A. THOMPSON
Judge of the Superior Court

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385010_2279%3A1. Public record. Not legal advice.