Storek & Storek, Inc. v. Port of Oakland

869 F.2d 1322, 1989 WL 20869
CourtCourt of Appeals for the Ninth Circuit
DecidedMarch 13, 1989
DocketNo. 88-1733
StatusPublished
Cited by3 cases

This text of 869 F.2d 1322 (Storek & Storek, Inc. v. Port of Oakland) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Storek & Storek, Inc. v. Port of Oakland, 869 F.2d 1322, 1989 WL 20869 (9th Cir. 1989).

Opinion

NOONAN, Jr., Circuit Judge:

Storek & Storek, Richard Storek and Glenn Storek (Storek) brought suit against the Port of Oakland (the Port). Jurisdiction existed under 42 U.S.C. § 1983. The district court denied summary judgment for the Port but certified two questions for interlocutory appeal to this court. We answer both negatively to the contentions of the Storeks and direct the district court to enter judgment for the Port on its motion for summary judgment on the Storeks’ first, third and fifth causes of action.

BACKGROUND

The Storeks are real estate developers who sought to develop a portion of Jack London Square in Oakland. On September 7, 1985 the governing body of the Port met and did a variety of business. According to the board’s minutes:

Storek and Storek Project — Jack London Square Site A was the subject of a memo to the Board from the Executive Director, notifying the Board that only one proposal meeting the Board’s criteria of a “financially-capable owner-user developer with a demonstrated ability to immediately undertake and complete construction of an appropriate project” has been received for the development of Site A. Two other firms have expressed an interest but have not submitted a detailed proposal. Storek and Storek has been evaluated as to their ability to undertake, finance and bring the project to a successful completion, and this evaluation reasonably assures that Storek will be able to move ahead with the financing and completion of the project. As the environmental impact report for the Jack London Square development plan will not be approved until January, 1983, approval in principle of the project would not [1324]*1324commit the Port to an irrevocable step or lease commitments before firm evidence of financing or other conditions are met by Storek. As it appears that Storek has met all of the criteria, it was recommended that the Board approve the project in principle.

A discussion followed in which conditions of the approval were laid out and in which Richard Storek declared that “based on the board’s ‘statement of support’ his firm was prepared to spend in excess of $800,000 to prepare the project for a lending commitment, in addition to paying fees to the potential lender.” Another developer appeared and asked the board to delay its approval in principle but could not provide any details of his proposed development. The executive director’s recommendation was approved on motion and passed by a vote of five to one.

In the course of the next 10 months the Storeks tried to comply with the board’s conditions. However, on July 5, 1983 the Executive Director informed the board that all of the conditions had not been satisfied. Richard Storek appeared before the board and stated that “in his opinion the board has set unrealistic time requirements.” He asked for “more time for the completion of the board’s requirements.” The board, however, terminated the approval in principle and began negotiations with other developers.

On March 6, 1985 the Storeks brought this suit. The first cause of action alleged that “the Storeks held a valuable property interest in the leasing and development of Site A and that the board, in terminating the Storek’s approval in principle on July 5, 1983” deprived the Storeks of their entire property and rights in Site A. This deprivation was alleged to have been an inverse condemnation in violation of the fifth and fourteenth amendment to the United States Constitution and a violation of the civil rights of the Storeks contrary to 42 U.S.C. § 1983.

A second cause of action alleged that the board’s action had violated the Storek’s right to procedural due process. The third cause of action stated that the board, together with Oakland City employees and private individuals, had “knowingly and willingly conspired” to interfere with the prospective economic advantage the Sto-reks held with respect to the leasing and development of Site A. The fourth cause of action was a pendent claim for breach of contract under the statutory and common law of California. The fifth cause of action alleged a conspiracy to bring about the breach of contract set out in the fourth cause of action. This cause, too, was a pendent claim brought under California law.

The district court dismissed with prejudice the second cause of action and portions of the first cause of action. The Port moved for summary judgment on the Sto-reks’ remaining claims. The district court denied the motion for summary judgment but certified for interlocutory appeal the following questions:

(a) whether plaintiffs have a constitutionally protected property interest; and
(b) whether plaintiffs’ conspiracy claims, set forth as third and fifth causes of action in the complaint, are barred by the 100-day limitations period contained in California Government Code Section 911.2.

ANALYSIS

The principal contention of the Sto-reks is an imaginative and ingenious effort to convert a preliminary step in negotiation into a form of contractual obligation and then to parlay this contractual obligation into property protected by the Constitution of the United States. Bits of stray dicta support this bold enterprise. Sober consideration of the law of contract, the law of property, the law of civil rights and the law governing public bodies leads to only one conclusion: the Storeks have no property to be protected.

The Oakland City Charter provides that “all proceedings for the acquisition of real property ... or the granting of any lease longer than one year” shall be taken by ordinance of the Port. Oakland City Charter § 605. To constitute an ordinance a bill must be published at least once in the [1325]*1325official newspaper of the City and there must be two readings of the bill with a five day period between the first and final readings. Id. § 604. It is uncontestable that the board did not adopt an ordinance in approving the Storeks in principle. The Storeks concede that they do not have a lease. They argue that the approval in principle, while not a lease, is an interest in property.

Approval in principle is a common device of governmental bodies as well as of private companies and even of parents. Approval in principle is a way of saying, “Well, it looks pretty good to me; I am not completely sure. Go ahead and if all goes well you will get what you were hoping for.” At the board’s meeting on September 7, 1982 Richard Storek understood that this kind of commitment was what he was getting. He tried at the time to make it sound a little better by referring to it as “the Port’s firm support” but, as his own term “support” indicates, he was aware that he was getting nothing more definite. When the hour of reckoning came on July 5, 1983, Richard Storek was equally aware that he had no rights by which he could keep the board from ending the approval in principle. All he could do was to urge the board to be considerate, to be reasonable.

It would be strange if it were otherwise. A public body has to be protected against rash or even corrupt actions by its governing body by provisions such as the Oakland City Charter has for actions by the board.

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Related

Mola Development Corp. v. City of Seal Beach
57 Cal. App. 4th 405 (California Court of Appeal, 1997)
Lodestar Co. v. County of Mono
946 F.2d 898 (Ninth Circuit, 1991)
Storek & Storek, Inc. v. Port Of Oakland
869 F.2d 1322 (Ninth Circuit, 1989)

Cite This Page — Counsel Stack

Bluebook (online)
869 F.2d 1322, 1989 WL 20869, Counsel Stack Legal Research, https://law.counselstack.com/opinion/storek-storek-inc-v-port-of-oakland-ca9-1989.