Lands Letter - 10/15/2003 (Plain Text Version)

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In this issue:
Letter from the Editor
Landgate Delay
Ninth Circuit Speaks to Conditional Use Permit
The "Santini Reservation"
Supremes Refuse to Address Conflict Between Williamson County and College of Surgeons
Affordable Housing Statutes Affected a Taking
Actions in the State Legislatures
Recent Land Use News
Moratorium Battle in New York
Atlanta Area Builders Association Wins Major Fee Settlement
Attorney Profiles

Landgate Delay

On October 6, 2003, the U.S. Supreme Court denied a California property owners petition for a writ of certiorari in a case in which the owner was foiled by a "Landgate delay."

In Loewenstein v. City of Lafayette, 103 Cal. App. 4th 718 (2003), the property owners purchased two small parcels adjacent to their existing lot then attempted through a lot line adjustment provision to build a second house on the additional property. In denying the lot line adjustment application, the city found that the proposed action would violate existing subdivision restrictions; the city also passed a resolution prohibiting the creation of an additional lot unless the property owners participated in a formal subdivision review process. In 2000, a superior court entered judgment reversing the city's denial of the lot line adjustment application, found that the resultant two-year delay constituted a taking under Penn Central, and ordered the city to pay compensation to the property owners. Additionally, in an earlier, separate ruling, the superior court also held that the city's denial of the lot line adjustment was not otherwise an arbitrary or capricious decision.

In a reversal and a deferential nod to Landgate, Inc. v. California Coastal Commission, 17 Cal. 4th 1006 (1997), the Court of Appeal, First District, concluded that the City of Lafayette did not take the Loewensteins' property even though the city's erroneous denial of the lot line adjustment caused a two-year delay in development of the proposed project. Adhering to Landgate, the Court of Appeal found that the two-year delay to resolve the threshold issue of the availability of the lot line adjustment provision was not an unreasonable regulatory delay and that the city's action was not taken solely to delay the proposed project.

Of particular note, the Court of Appeals found that because Landgate governs this case, application of the Penn Central factors "...will, of necessity, be absent." The Court of Appeal stated that a landowner "can have no reasonable expectation that there will be no delays or bona fide differences of opinion in the application process for development permits" and that "[s]ometimes the application process must detour to the court process to resolve a genuine disagreement." Finding that this particular two-year delay "comes within the Landgate category of normal delays," the Court of Appeal found that the temporary economic impact on the property owners should be considered "a normal incident of property ownership." As such, the temporary economic deprivation "does not figure in the weighing process against the government in a Penn Central analysis... [I]n short, the analysis stops when Landgate forecloses it."