California Court Of Appeal: Takings Claims Brought Too Early, Too Late, And No Damages For Violations Of The Right To Petition (Inter Alia)

The latest skirmish in California's mobile home rent control wars, this time from the California Court of Appeal, Fourth District, in two cases out of San Diego county, MHC Financing Ltd. P'ship v. City of Santee, No. D053345 (Mar. 15, 2010).

The cases present a convoluted series of facts and procedural twists which we are not going to rehash, but recommend that you read yourself. It's a long opinion (50 pages), but it's worth delving into the details. The court held:

• First, the property owner "sustained no legally remediable injury" from the retroactive application of a mobile home rent control ordinance which the city adopted to correct errors in an earlier-adopted mobile home rent control ordinance (the erroneous ordinance was based on the original version of a proposed initiative ordinance, and not the modified initiative ordinance which was certified by petition) (slip op. at 15-19).

• Damages are not an available remedy for violations of the right to petition under the California Constitution (slip op. at 21-28).

• The "as applied" takings challenge was not ripe under Williamson County's "final decision" requirement because the property owner had not submitted an application for a rent adjustment as allowed by the city's rent control ordinance  (slip op. at 30-34).

• The facial takings and substantive due process challenges were brought more than two years after the ordinance had been adopted, and the statute of limitations had therefore expired (slip op. at 34-37).

• The claim for equitable indemnity failed because that doctrine is limited to one tortfeasor being indemnified by another tortfeasor  when they are jointly and severally liable to a third party. Here, the property owner claimed that the city was directly liable to it for damages it allegedly owed to third parties. The court determined this was not a proper claim for equitable indemnity (slip op. at 37-39).  

• The trial court property sustained the city's demurrer (a motion to dismiss, for all you non-Californians) to other claims on a number of grounds: (1) the claim the taking of the property was a private taking was brought too late (slip op. at 40-41); and (2) there was no physical taking (which is based on a government requirement to allow third parties to enter one's land) because the mobile home park operators "voluntarily rented their land" (slip op. at 43) (citing Yee v. City of Escondido, 503 U.S. 519, 527 (1992)).

• Finally, the court reversed summary judgment for the city on one of its affirmative claims against the property owner, restitution. The city claimed that the property owner owed mobile home park tenants restitution for the rent it overcharged them while a lower court order (subsequently reversed) was in effect. The court upheld the property owner's assertion that the city lacked standing to seek restitution on behalf of others (slip op. at 46-47).