Reply Brief — City of Los Angeles v. Ali

Supreme Cvart, U.S.

FILED

2. )

~A AUG 15 2000

No. 99-2084

CLERK

In The

Supreme Court of the United States

+

THE CITY OF LOS ANGELES,

Petitioner,

SYED MOUZZAM ALI,

Respondent.

¢

On Petition For A Writ Of Certiorari

To The California Court Of Appeal

¢

REPLY TO BRIEF IN OPPOSITION

¢

James K. Haun, City Attorney

CraupiA McGee Henry,

Senior Assistant City Attorney

Counsel of Record

MICHAEL L. KLEKNER,

Deputy City Attorney

1800 City Hall East

200 N. Main Street

Los Angeles, California 9001

(213) 485-5419

Attorneys for Petitioner

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964

OR CALL COLLECT (402) 342-2831

1

I

THE RECORD IN THIS CASE SHOWS THAT THE

PRESENT FEDERAL ISSUES WERE DECIDED BY THE

CALIFORNIA COURTS

Despite Respondent’s argument to the contrary, juris-

diction is conferred upon the United States Supreme

Court to review the federal questions presented in the

within Petition for Writ of Certiorari pursuant to 28

U.S.C.A. § 1257(a).

In the present case, it is eminently clear that the

California Court of Appeal decided a federal question in

determining that there had been a temporary regulatory

taking for which just compensation must be paid.

Citing decisions of this court, the trial judge, Califor-

nia Superior Court Judge Crispo, found that there had

been a regulatory taking for which just compensation

must be paid. He ruled as follows:

“A taking of property occurs when a govern-

ment regulation eliminates the economic via-

bility of property to its owner. Lucas v. South

Carolina Coastal Council (1992), 505 U.S. 1003... .

When a taking occurs, the government must pay

just compensation to the property owner. U.S.

Const., Amend V. Just compensation is required

even if the taking is a temporary one. First

English Evangelical Lutheran Church of Glendale v.

County of Los Angeles (1987) 482 U.S. 304.” (App.

30)

The California Superior Court Judge Crispo further

explained the basis of his finding of a regulatory taking

by writing:

“Regulatory taking: The denial of Ali’s applica-

tion for a demolition permit pursuant to the

City’s Rent Stabilization Ordinance (“RSO”)

constituted a regulatory taking. A regulatory

taking occurs when an ordinance ‘does not sub-

stantially advance legitimate state interests or

2

denies an owner economically viable use of his .

land.’ Agins v. City of Tiburon (1980) 447 U.S. 255,

260.

The City’s initial designation of the Ferraro

as an SRO was erroneous. The SRO ordinance

prevented the immediate demolition of the Fer-

raro.” (App. 31)

The City appealed this decision to the California

Court of Appeal. (App. 119-123). The Court of Appeal

rejected the City’s arguments. The California Court of

Appeal made it clear that its decision would be based on

its understanding of this Court’s decisions by stating:

“In First Lutheran Church v. Los Angeles County

(1987) 482 U.S. 304, (hereafter First English) the

Supreme Court indicated that a governmental

regulation which deprives a landowner of all

economically viable use of the land may consti-

tute a regulatory taking of property which

requires just compensation under federal consti-

tutional law. (Id. at pp. 312-313.) This is consis-

tent with the United States Supreme Court's

pronouncements both before and after First

English. (See Agins v. City of Tiburon (1980) 447

U.S. 255, 260, (citation)... ” (App. 6)

The California Court of Appeal then explained its

understanding of First English by stating as follows:

The court in First English indicated two circum-

stances in which such a temporary denial of all

use of the property would not require compen-

sation: (1) the denial of use was required for

public safety reasons (citation), or (2) the tempo-

rary deprivation was merely a normal delay in

the permissible regulation of development.

(citation.)” (App. 6-7)

After discussing this precedent and cases applying it,

the California Court of Appeal held that:

“(T]he delay in demolition caused by the erro-

neous enforcement of the SRO ordinance despite

3

the prohibitions of the Ellis Act was not a “nor-

mal” delay in the development process. Because

the delay temporarily deprived Ali of all use of

his property and was not a normal delay in the

development process, it was a temporary regu-

latory taking which required compensation

under First English. Judge Crispo correctly

awarded a judgment in favor of Ali in inverse

condemnation.” (App. 14)

A petition for review was filed with the California

Supreme Court. App. J. The City’s Petition for Review to

the California Supreme Court explicitly tendered the fol-

lowing questions:

“Is a landowner entitled to damages for a regu--

latory taking based on a non-final decision

reversed by the government agency through its

own development approval process?

May a landowner pursue damages for a regula-

tory taking without first succeeding in setting

aside the government agency’s decision through

a judicial determination in a mandamus pro-

ceeding?

Can an action of a government agency that

exceeds its statutory authority be a compensable

taking?” (App. 56-57)

The order of the California Supreme Court denying

the Petition for Review was entered on March 29, 2000.

(App. F)

Although worded differently the questions now

before the Court raised the same federal issue, i.e., has

there been a temporary regulatory taking for which just

compensation must be paid?

4

Il

JUDGE CRISPO’S FINDINGS OF FACT ARE RELE-

VANT TO RESPONDENT’S REGULATORY TAKINGS

THEORY

It is undisputed by the parties that there was a delay

in the issuance of a demolition permit between January

1989 and August 1990. The development approval pro-

cess in this case centered around a dispute over the

correct classification of the Ferraro Hotel. Once Ali dem-

onstrated that there had been a misclassification by

exhausting his administrative remedies, the City gave

him the requested permit.

At trial, Judge Crispo, as the trier of fact, found as an

historical fact that this delay was due to a misclassifica-

tion of the property. Judge Crispo based his finding of a

regulatory taking solely on the fact that the City had

mistakenly misclassified the hotel. Judge Crispo, in ruling

on Ali’s cause of action for inverse condemnation found

that: “The City’s initial designation of the Ferraro as an

SRO was erroneous. The SRO ordinance prevented the

immediate demolition of the Ferraro... .” (App. 31).

He did not criticize the City for acting in bad faith or

in an arbitrary manner. Indeed, Judge Crispo made the

following findings about the character of the City’s

actions:

“(T]he City’s actions were not oppressive nor do

they shock the conscience. While the actions of

the City’s employees were negligently per-

formed, there is no credible evidence that they

deliberately sought to deprive Mr. Ali of his due

process rights. On the contrary, the court finds

that they acted in good faith. Finally, the City’s

action, though misguided, was an attempt to

further legitimate interests in protecting both its

zoning integrity and the public.” (App. 24-25)

Despite these findings of fact the California Court of

Appeal held that “ . . . the position taken by the City was

5

so unreasonable from a legal standpoint as to be arbi-

trary, not in furtherance of any legitimate governmental

objective, and for no other purpose than to delay any

development other than for an SRO hotel. Therefore the

delay in demolition of the hotel was a temporary regula-

tory taking requiring compensation.” (internal quotes

omitted) (App. 13)

This finding is in direct conflict with that of the trier

of fact. It appears to be the view of the California Court

of Appeal that the obligation to provide just compensa-

tion can be triggered by governmental error even in the

absence of any due process violations. Judge Crispo

expressly found that the City acted in good faith in an

attempt to protect both its zoning integrity and the pub-

lic. Neither policy nor precedent support a finding that

just compensation must be paid under such circum-

stances.

CONCLUSION

For these and all the above reasons the petition for a

writ of certiorari should be granted.

Respectfully submitted,

James K. Hann, City Attorney

Craupia McGee Henry,

Sr. Assistant City Attorney

MiIcHAEL L. KLEKNER,

Deputy City Attorney

Attorneys for Petitioner