You all have likely seen 'em, those "We Buy Houses Any Condition" billboards letting the world know that no matter what condition it might be in, there's an outfit that says it is willing to buy your house.
Well, that outfit ran into the one other outfit that is willing to buy your house, except here, that outfit can force you to sell it. That's right, the government. In this case, the City of Ontario, California, exercising its power of eminent domain. (As someone once famously described the power of eminent domain: "whether you know it or not, your house is for sale.")
The city went through the usual motions to forcibly take "multiple vacant lots" next to the Ontario International(!) Airport which it claimed were blighted:
In 2021, the City held a public hearing, after which the city council adopted a resolution of necessity authorizing the City to commence eminent domain proceedings to acquire the properties. The resolution of necessity stated: “The public uses for which the real property interest is to be acquired are mitigation of airport impacts and elimination of blight in the City of Ontario, San Bernardino County, California. Sections 37350.5 and 50470 of the California Government Code authorizes [sic] the City to acquire by eminent domain real property necessary for such purposes.” The council found that “[t]he public interest and necessity require the proposed project” and “[t]he proposed project is planned or located in the manner that will be most compatible with the greatest public good and least private injury.” However, the resolution did not describe any proposed project.
The trial court agreed with the property owner, who argued that in addition to the resolution requiring a statement that the taking is for a public use, must also identify a proposed project supporting the condemnation.
In City of Ontario v. We Buy Houses Any Condition, LLC, No. D083080 (July 19, 2024), the California Court of Appeal affirmed. The court concluded that California's eminent domain statute is a "comprehensive statutory scheme to define the substantive and procedural parameters of eminent domain." Slip op. at 5. And you gotta follow the rules. One of those rules is that the condemnor may take the property, but "only if all of the following are established" --
- the "public interest and necessity" require the project
- the project is designed in such a way "that will be most compatible with the greatest public good and the least private injury:
- the property sought to be acquired is "necessary for the project"
Cal. Code Civ. P. § 1240.030.
Relying on the reasoning set out in one of our favorite California eminent domain cases, the appeal court held that the statute not only requires a statement of public use and necessity, but some reference to a project. Failing that you lose, condemnor:
Thus, a “governing entity [must] identify a ‘project’ with a public purpose before it undertakes to condemn private property.” (Marina Towers, supra, 171 Cal.App.4th at p. 107.) “[A] resolution of necessity that does not identify a project with sufficient specificity, such that persons of ordinary intelligence can discern what the ‘project’ is, cannot support the taking of private property.”
Slip op. at 5-6.
The city's resolution here did not meet that standard, and was thus a "gross abuse of discretion." Slip op. at 6.
The court rejected the city's argument that under California's Community Development Law, the condemnor doesn't need to show no stinkin' project (hat tip to Gideon Kanner), only that the properties were blighted under Cal. Health & Safety Code § 33073, which it claimed was a "safe harbor" from the usual three requirements.
No, held the court. "As we shall explain, neither the language of Marina Towers nor what remains of the CRL authorized the City to condemn the properties without identifying a proposed project." Slip op. at 7.
We won't go into the details, but here are the salient points. Remember that back in the day, the California Supreme Court acknowledged that the legislature gutted the formerly powerful redevelopment law (the gutting wasn't because the lege was disgusted by the way that redevelopment was being accomplished, but rather so the state could grab the money the redevelopment agencies had accumulated). The court rejected the city's claim that section 33073's provision that government may "seek the acquisition of the properties by eminent domain for the elimination of blight" exempts the city from Civil Procedure section 1240.030's requirements. Nothing in the redevelopment law "suggests it creates an exception to the eminent domain law's requirement of an adequate project description." Slip op. at 10.
Finally, the court rejected the city's argument that taking properties to minimize noise and safety hazards under separate statutes means that the takings here didn't need to identify the project. Not so: "Neither of these provisions purports to excuse a local agency from following the eminent domain law’s requirement to identify a project." Slip op. at 14.
To make it worse for the city, the court affirmed the trial court's award of attorney fees to the property owner, not limited to the fees incurred in the owner's motion for summary judgment, but for all of the trial court litigation. Start at page 15 of the slip opinion for the reasons.
The opinion is not published. But should be.
City of Ontario v. We Buy Houses Any Condition, LLC, No. D083080 (Cal. Ct. App. July 19, 2024)
