National Advertising Co. v. County of Monterey

464 P.2d 33, 1 Cal. 3d 875, 83 Cal. Rptr. 577, 1970 Cal. LEXIS 356

• Court: California Supreme Court
• Decided: January 30, 1970
• Docket: S. F. 22659
• Status: Published

Opinions

Opinion

BURKE, J.

Defendant county appeals from a judgment declaring certain provisions of its zoning ordinance to be null and void and enjoining enforcement thereof as against plaintiff outdoor advertising company. As will appear, we have concluded that the removal requirements of the ordinance may validly be applied to certain of plaintiff’s billboards, but that as to others removal should await expiration of appropriate amortization periods.

Plaintiff owns and maintains outdoor advertising billboards which it erected on various parcels of private property that it holds under lease in defendant county. The advertising space provided by these outdoor structures is in turn rented out by plaintiff. Such advertising is known as off-site; i.e., it does not, in the language of defendant’s zoning ordinance involved herein, “relate only to goods sold or services rendered upon the building site on which said sign is erected.”

In 1955 defendant county adopted a comprehensive zoning ordinance which divided the county into various zones or districts, in only three of which were off-site signs permitted. Plaintiff had billboards in all of the prohibited districts, including districts unclassified as to use and called U districts by the ordinance. Section 12 of the ordinance prohibited the off-site signs in U districts, and section 34 provided that nonconforming uses under the ordinance, including then existing off-site signs in prohibited districts, must be removed after five years.

On appeal in a prior action between the same parties (National Advertising Co. v. County of Monterey (1962) 211 Cal.App.2d 375 [27 Cal.Rptr. 136]) both sections were held to be valid, except that portion of section 34 which required the removal of signs from U districts. With respect to the five-year amortization period, the opinion notes that zoning legislation may validly provide for the eventual discontinuance of nonconforming uses within a prescribed reasonable amortization period commensurate with the investment involved (Livingston Rock etc. Co. v. County of Los Angeles (1954) 43 Cal.2d 121, 127 [4] [272 P.2d 4]; City of Los Angeles v. Gage (1954) 127 Cal.App.2d 442, 454-460 [274 P.2d 34]); that one who attacks a zoning ordinance as unreasonable bears the burden of establishing this claim (Beverly Oil Co. v. City of Los Angeles (1953) 40 Cal.2d 552, 559 [6] [254 P.2d 865]; Wilkins v. City of San Bernardino (1946) 29 Cal.2d 332, 338 [3] [175 P.2d 542]); and that with respect to such of plaintiff’s prohibited billboards as were located in other than U districts plaintiff had failed to show the costs of the structures, dates of construction or remaining useful life, or to otherwise establish that the amortization period of five years was unreasonable. (Pp. 380-381 [7-9] of 211 Cal.App.2d.) Accordingly, section 34 of the ordinance was upheld insofar as it required the removal of billboards in six districts in which the ordinance detailed the character of the district and the uses permitted therein.

With respect to U districts, the opinion in the earlier appeal pointed out. that under the ordinance U districts were designed as holding areas whose rural character was to be maintained only until some definite trend toward particular uses began to develop, and that some of the U areas might develop as commercial or industrial zones in which billboard signs were permitted. The court reasoned, accordingly, that it was unreasonable “to require removal of such signs in areas whose ultimate use is not now determinable. Upholding that portion of the removal requirement could well result in destruction today of a sign which could be rebuilt in the near futúre. When a particular ‘U’ district has developed sufficiently to warrant placing it in a specific district, it will be time enough to resort to the remedy of removal.” (P. 382 [10] of 211 Cal.App.2d.)

The present litigation involves some 42 of plaintiff’s billboards located in U districts, and grows out of amendments to defendant’s zoning ordinance. In 1964 section 34 was amended to provide in pertinent part that all billboards in a U district “shall be removed entirely within one year from the date said property is reclassified into some other zoning district. . . .” (Italics added.) In April 1965 the ordinance was again amended to provide, inter alia, that an N zoning district was established as a rural area in which billboards were not permitted.

As a result of this rezoning, 41 of the subject billboards were placed in an N district and the other was placed in a PC (planned commercial) district. In the PC district no use is permitted except as part of a comprehensive, all-over development plan which has been approved by the county zoning authorities. When the amendments became effective in May 1965, the one-year removal period thus commenced with respect to plaintiff’s 42 signs involved here, and plaintiff instituted this suit to enjoin enforcement of the removal provisions.

The contracts under which plaintiff rents out advertising space on the billboards are for minimum periods of three and four years, under which no profit is usually made until the third year. The boards were constructed and erected during the years 1933 to 1950 at a cost varying from $360 to $2,600 each. The trial court found that at a “high” cost the boards have also been carefully maintained through repair and in many instances have been rebuilt and “have accordingly many years of useful life remaining”; that plaintiff’s business also “requires it to prorate a proportionate cost of its considerable overhead expenses to each sign location and over the period of each sign lease”; that the cost of removal of the signs would be $5,850. The trial court held that the 1965 zoning reclassification was valid, but that the 1964 amendment to section 34 was invalid in that the one-year amortization provision for removal of non-conforming signs was unreasonable and arbitrary under the circumstances, and represents the taking of property without due process of law. Judgment was entered enjoining enforcement of the removal provisions as to plaintiff, and this appeal by defendant followed.

In determining whether the amortization period prescribed by legislation which provides for the eventual discontinuance of nonconforming uses is reasonable and commensurate with the investment involved and so may validly apply to the particular property and use at issue, each case must be determined on its own facts. (Livingston Rock etc. Co. v. County of Los Angeles, supra, 43 Cal.2d 121, 126; Beverly Oil Co. v. City of Los Angeles, supra, 40 Cal.2d 552, 560; City of La Mesa v. Tweed & Gambrell Planing Mill (1956) 146 Cal.App.2d 762, 770 [304 P.2d 803]; see also City of Santa Barbara v. Modern Neon Sign Co. (1961) 189 Cal.App.2d 188 [11 Cal.Rptr. 57]; City of Los Angeles v. Gage, supra, 127 Cal.App.2d 442.) Plaintiff’s burden here is to establish the invalidity of the ordinance in its application to plaintiff’s property. (Beverly Oil Co. v. City of Los Angeles, supra, at p. 559.)

From the record it appears that nine of plaintiff’s billboards are supported by single steel posts, five of them by either two or three timber posts, and the remainder vary in size from 6 feet by 10 feet to 15 feet by 60 feet with up to seven supporting timbers each. The sign panels are made of either steel, plywood or masonite. Plaintiff’s amortization evidence was to the effect that under rules of the federal Internal Revenue Service plaintiff is required to amortize the costs of its signs over periods ranging from 10 years to 25 years, depending on the type of construction. As of December 1966, 31 of the signs had been fully amortized on this basis, 9 of them had either 5 or 6 years of remaining unamortized life, and the other 2 had 8 and 9 years, respectively.

Plaintiff’s witness testified that because of exposure of the signs to the elements, plaintiff is constantly repairing them “within the limits of the ordinance . . . but no major repairs, because all we can do is maintain it.” However, these repairs actually add to the useful life of the signs, and plaintiff claims that the signs have a “book value” which “represents a true, existing capital investment . . . which cannot in most instances be further depreciated.” The amount of this so-called book value is Usted by plaintiff at 40 percent of the original cost of each sign regardless of age, including the 31 which as stated have been fully amortized, and is supported by nothing more than plaintiff’s bare assertion. Plaintiff produced no evidence with respect to present actual value of any of the signs, or relating to amortization of any such value.

It is apparent that plaintiff has totally failed to show arbitrariness and unreasonableness with respect to the 31 signs which its evidence indicated had already been fully amortized. Although essential maintenance repairs may be said to prolong to a degree the useful life of any structure, and are permitted to those that are nonconforming (Ricciardi v. County of Los Angeles (1953) 115 Cal.App.2d 569, 576 [5] [252 P.2d 773]), the repairs cannot be relied upon to defeat zoning legislation which looks to the future and the eventual liquidation of nonconforming uses. (Livingston Rock etc. Co. v. County of Los Angeles, supra, 43 Cal.2d 121, 127 [4].) It may also be noted that there is no showing that if, as testified by plaintiff’s witness, these signs have been repaired to such an extent that they have many years of useful life remaining, they cannot be used elsewhere. Plaintiff’s assertion in its brief that the signs have value only in their particular locations and for their peculiar use is unsupported by evidence and fails to meet plaintiff’s burden of proof.

With respect to the other 11 signs, not yet fully amortized, removal should await expiration of a reasonable amortization period in order to permit plaintiff to recover their original cost.¹

The judgment is reversed with respect to the 31 fully amortized signs, but is affirmed otherwise. Each party shall bear its own costs on appeal.

Traynor, C. J., McComb, J., and Mosk, J., concurred.

1 The fact that because of start-up and servicing costs no profit is realized by plaintiff under its contracts until the third year is not helpful. Although it would appear that any such contracts entered into before the effective date of the 1965 amendments should be permitted to run their course before removal of the involved sign is required, all of those contracts have of course expired by now. With respect to 25 contracts shown to have been entered into after the effective date of the 1965 amendments, plaintiff proceeded at its own peril insofar as any such contract covered a sign already fully amortized. Additionally, the removal costs, averaging $139 per sign, do not demonstrate that the ordinance is arbitrary or unreasonable; such costs may not reasonably be compared with the net profit from only the latest contracts covering the signs, but instead relate to their entire productive periods.