Mola Development Corp. v. City of Seal Beach

57 Cal. App. 4th 405, 67 Cal. Rptr. 2d 103, 97 Daily Journal DAR 11277, 97 Cal. Daily Op. Serv. 7046, 1997 Cal. App. LEXIS 684
CourtCalifornia Court of Appeal
DecidedAugust 27, 1997
DocketG014576
StatusPublished
Cited by13 cases

This text of 57 Cal. App. 4th 405 (Mola Development Corp. v. City of Seal Beach) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Mola Development Corp. v. City of Seal Beach, 57 Cal. App. 4th 405, 67 Cal. Rptr. 2d 103, 97 Daily Journal DAR 11277, 97 Cal. Daily Op. Serv. 7046, 1997 Cal. App. LEXIS 684 (Cal. Ct. App. 1997).

Opinion

Opinion

CROSBY, J.

Is the mere filing of a lawsuit for administrative mandamus the same as pursuing it to decision? Mola Development Corporation argues it is, but we disagree. Mola filed an action for administrative mandamus to overturn the City of Seal Beach’s quasi-judicial decision to disapprove a vesting tentative map, but voluntarily dismissed it on the eve of trial. That dismissal precludes, we will hold, a suit for damages for a regulatory taking.

There is an obvious and fundamental distinction between initiating mandamus and obtaining a judgment. The Supreme Court tells us “[a] final administrative decision includes exhaustion of any available review mechanism.” (Hensler v. City of Glendale (1994) 8 Cal.4th 1, 12 [32 Cal.Rptr.2d 244, 876 P.2d 1043], italics added.) By dropping mandamus, Mola allowed the administrative decision to achieve finality and issue preclusive effect. It cannot now seek damages for a regulatory taking.

We are not impressed with Mola’s claim to be exempt from the mandamus requirement because its option to develop the property expired during the pendency of the mandamus action. Hensler itself holds that private parties cannot unilaterally shorten the time for reasonable administrative and judicial review by terminating their property interests in the subject development.

Our decision does not place developers like Mola in a “Catch-22” from which they never can extricate themselves. Mola, not Seal Beach, determined the length of its option. Nothing in the record suggests the city tried to run out the clock until the option expired. Mola did nothing to expedite the trial of the mandamus action while its option was still extant; to the contrary, the evidence shows Mola itself continued the trial to accommodate its new trial counsel until after the option ran. Mola’s expired option does not justify depriving Seal Beach of the opportunity afforded by mandamus to *408 rescind or modify invalid development restrictions before being subjected to a claim for damages for a regulatory taking.

I

Mola acquired an option from Heilman Properties to purchase and subdivide a portion of the Heilman Ranch, 149 acres of undeveloped real property in Seal Beach. Mola proposed to build more than 300 residential units.

The project was controversial from the start. It traversed the Inglewood-Newport earthquake fault and encompassed significant wetlands areas. There was much local opposition. Despite this, the project was initially approved in 1989 by the city council, which adopted a vesting tentative map and approved a development agreement. 1

A citizens group sued Mola and the city. In May 1990, the superior court (Judge Bauer) invalidated the approvals, finding they were void at the outset because the city’s general plan contained an obsolete housing element. The city council accepted the court’s judgment and immediately adopted a new housing element. It rescinded the ordinances and resolution at issue.

A reconstituted council reconsidered the Mola project under the new general plan. On June 25, 1990, the council conducted public hearings and adopted Resolution No. 3937 by a three-to-two vote. It disapproved Mola’s application for a vesting tentative map, a related specific plan amendment, and a development agreement. The council determined Mola’s proposals were not in compliance with the new general plan.

The council purported to base its decision in part on the “geologic instability of the site,” information gained from the Loma Prieta earthquake, which struck the San Francisco Bay area the previous October, and evidence presented by geologists and seismic consultants. It found certain portions of the site to pose such high potential for liquefaction that residences should not be constructed there without further study. The city invited Mola to work with its staff to provide for “appropriate development, including residential uses.”

Mola attacked the city’s decision on two fronts. On July 20, 1990, Mola appealed from the trial court’s judgment invalidating its development approvals. Mola argued Judge Bauer abused his discretion in declaring the *409 development approvals for the project to be void ab initio, thereby requiring Mola to “throw out” its nearly $11 million in expenditures and “four years of planning, processing, and public hearings, and . . . or . . . start from scratch . . . Mola contended Judge Bauer should not have invalidated the prior approvals, but simply suspended them during the time the city’s housing element was technically out of compliance with state law. 2

In September 1990, contending the city had “finally and conclusively acted to prohibit development,” Mola petitioned for a writ of administrative mandate pursuant to Code of Civil Procedure section 1094.5. Mola also sued the city and the three councilmembers who voted against the project for damages for civil rights violations and for inverse condemnation.

In July 1991, about ten months after the petition for writ of mandate was filed, the trial court ordered a December trial date for the writ proceedings, with the remaining causes of action to be tried later. In November Mola moved to continue the December trial for an additional 150 days because of the “normal, time-consuming pace of complex civil litigation” and because it had been forced to retain new counsel. The trial court agreed to a continuance over objection, until February 1992.

In October 1991, a different panel of this court decided Mola’s appeal from Judge Bauer’s order invalidating the city’s original development approvals. We agreed with Judge Bauer that the development approvals were void and that the city was required “to start the process anew” upon the city’s approval of a new housing element. (Wetlands Restoration Society v. City of Seal Beach, supra, G009822.)

Mola’s option to acquire a portion of the Heilman Ranch expired in November 1991. According to Mola, “[o]n December 6, 1991, the true owner of the subject property terminated all of Mola’s interests in the property” and refused to grant any further extensions. Mola says it thereby lost any rights to purchase or develop the property, causing it to lose the “beneficial interest” necessary to assert a claim for administrative mandamus. Mola had not previously sought to expedite the mandamus trial while it still had a viable option to purchase the property.

Despite its claim to loss of standing, on December 10, 1991, Mola petitioned for review of this court’s October 31 opinion. Mola filed a reply brief in the Supreme Court on January 9, 1992. The court denied review on March 2, 1992.

*410 On February 14, four days before the continued trial date, Mola dismissed its mandamus claim without prejudice. The record does not reveal why.

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57 Cal. App. 4th 405, 67 Cal. Rptr. 2d 103, 97 Daily Journal DAR 11277, 97 Cal. Daily Op. Serv. 7046, 1997 Cal. App. LEXIS 684, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mola-development-corp-v-city-of-seal-beach-calctapp-1997.