Opinion
B229756
09-22-2011
MANUEL GURROLA, Plaintiff and Appellant, v. CITY OF LOS ANGELES, Defendant and Respondent.
Blum Collins, Steven A. Blum for Plaintiff and Appellant. Carmen A. Trutanich, City Attorney, Andrew J. Nocas and Peter E. Langsfeld, Deputy City Attorneys, for Defendant and Respondent.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
(Los Angeles County Super. Ct. No. BC391178)
APPEAL from a judgment of the Superior Court of Los Angeles County, Malcolm H. Mackey, Judge. Affirmed.
Blum Collins, Steven A. Blum for Plaintiff and Appellant.
Carmen A. Trutanich, City Attorney, Andrew J. Nocas and Peter E. Langsfeld, Deputy City Attorneys, for Defendant and Respondent.
Plaintiff and appellant Manuel Gurrola appeals a judgment following a grant of a motion by defendant and respondent City of Los Angeles (the City) for judgment on the pleadings.
Gurrola knowingly purchased two damaged vacant lots at a tax sale. Gurrola then sued the City for inverse condemnation, seeking compensation for the cost of stabilizing the property in order to be able to develop the land with single family homes.
The essential issue presented is whether Gurrola stated a cause of action against the City for inverse condemnation.
We conclude the trial court properly held Gurrola lacked standing to sue for inverse condemnation because he purchased the property in its damaged state. The "right to recover this amount remains in the person who owned the property at the time of the taking or damaging, regardless of whether the property is subsequently transferred to another person. [Citations.]" (City of Los Angeles v. Ricards (1973) 10 Cal.3d 385, 389, italics added (Ricards).) The judgment is affirmed.
FACTUAL AND PROCEDURAL BACKGROUND
This summary is drawn in part from our previous decision in this matter, Gurrola v. City of Los Angeles, No. B212624 (nonpub. opn., filed Nov. 24, 2009) (Gurrola I).
During the winter rains of 2005, a certain storm drain (the Evadale storm drain) in the Montecito Heights area of Los Angeles failed, eroding the subject hillside lots at 3949 and 3951 N. Evadale Drive and creating a gully. On or about February 25, 2005, the City initiated phase one of the Evadale Drive Emergency Storm Drain Replacement Project, using $71,000 in FEMA and/or other funds to construct a temporary storm drain.
On August 9, 2005, Gurrola purchased the subject properties, two vacant lots, at a tax sale. Gurrola seeks to develop each lot with a new two-story single family residence.
On March 29, 2007 or April 3, 2007, Gurrola presented a government claim to the City for damages arising out of the failed storm drain.
On May 5, 2008, the City notified Gurrola his claim was "rejected by operation of law" and that he had six months in which to file suit on the claim. (Gov. Code, § 945.6.)
I. EARLIER PROCEEDINGS LEADING TO THE PRIOR APPEAL
1. Pleadings.
On May 20, 2008, Gurrola filed suit against the City. The first amended complaint, filed three months later, set forth the following six causes of action: inverse condemnation; property damage; dangerous condition of public property (Gov. Code, § 835); breach of mandatory duty of public entity (Gov. Code, § 815.6); negligence (Gov. Code, § 815.2, subd. (a)); and nuisance (Civ. Code, § 3479). Gurrola alleged in relevant part:
The Evadale storm drain failed due to the City's failure to properly design, monitor and/or maintain the drain, causing a significant portion of his properties to erode into a large gully, and the gully continues to expand due to storm water and wind erosion.
On or about February 25, 2005, the City evaluated the scene of the gully and initiated the first phase of the Evadale storm drain project, using FEMA and/or other monies to construct a 200-foot surface temporary storm drain to carry flow from Evadale Drive to Montecito Drive. Phase one was completed at the end of April 2005.
In August 2005, as part of his due diligence, Gurrola discovered the eroded gully.
Gurrola purchased the properties with a deposit on August 9, 2005 and completed the purchase on September 9, 2005.
On or about August 9, 2005, Gurrola spoke with a staff person at the City's Bureau of Engineering (Bureau), who told him the Bureau was preparing plans for a permanent storm drain, was in the process of obtaining a geotechnical assessment and was waiting to see what the report would recommend to repair the damage. Gurrola then had ongoing discussions with Bureau staff regarding the storm drain, the City's responsibility for the erosion gully and the status of the geotechnical report.
On July 26, 2006, the City's Geotechnical Engineering Division (GED) prepared a report of the key geotechnical issues pertinent to the project and recommendations for design and construction of the project.
On August 1, 2006, Gurrola obtained a copy of the GED report and noticed the report indicated "GED's services did not include an evaluation of the gross stability of the hillside. Thus, GED is not in a position to provide an opinion with respect to the overall stability of the hillside and the potential for future land sliding impacting the planned improvements."
In August 2006, Gurrola spoke to the City about his "concerns about the lack of discussion related to the gully, remedial grading of the gully and the City's responsibility to fix it." The City responded that "the report was adequate for designing the Project, including backfilling the subsurface pipe and gully."
In March 2007, the City completed design of the second phase of the project and it did not include repair of the gully area. On March 27, 2007, Bureau staff told Gurrola "for the first time that [the City] recently determined to not backfill the new storm drainpipe as well as the gully due to excessive cost." (Italics added.)
The City's decision not to repair the gully prompted Gurrola (on March 29, 2007 or April 3, 2007) to present a claim for damages to the City.
On April 1, 2008, Gurrola agreed to the City's request to extend review of his claim to April 15, 2008. Thereafter, Gurrola agreed to another extension, agreeing to extend the review period to April 24, 2008. Gurrola then refused to agree to another extension of time. On May 5, 2008, the City advised Gurrola his claim was denied by operation of law, so as to commence the six-month period for filing suit on the claim.
2. Demurrer to first amended complaint sustained without leave.
The City demurred to the first amended complaint in its entirety.
With respect to the first cause of action, inverse condemnation, the City contended it was time-barred because the original complaint, filed May 20, 2008, was filed more than three years beyond the accrual date of February 25, 2005. (Code Civ. Proc., § 338, subd. (j).) The City asserted the accrual period begins to run when the damage is sufficiently appreciable to a reasonable person, and here, the accrual date could be no later than February 25, 2005, the date the City reported the damage and took the initial steps to repair it.
No claim is required to be filed to maintain an action against a public entity for inverse condemnation. (Gov. Code, § 905.1.)
As for Gurrola's other five causes of action, the City contended they were barred by Gurrola's failure to present a government claim to the City within one year of the accrual date, which occurred no later than February 25, 2005. (Gov. Code, §§ 905, 911.2, 945.4.)
On October 28, 2008, the trial court sustained the City's demurrer as to all causes of action of the first amended complaint without leave to amend.
3. Gurrola I.
In Gurrola I, filed November 24, 2009, we affirmed in part and reversed in part. We held all of Gurrola's claims, other than the inverse condemnation claim, were barred by his failure to present a timely claim to the City. However, we determined the cause of action for inverse condemnation was not demurrable on statute of limitations grounds. We explained:
"The statute of limitations for inverse condemnation is three years. ([Code Civ. Proc.,] § 338, subd. (j).) [¶] 'The date the taking occurred is not necessarily the date on which the period of limitation and of claims started to run. [] [Rather, the period begins to run when the damage is sufficiently appreciable to a reasonable man. [Citation.]" (Mehl v. People ex rel. Dept. Pub. Wks. (1975) 13 Cal.3d 710, 717 (Mehl).)
"[¶] . . . [¶]
"Here, the first amended complaint alleges it was not until March 2007 that the City advised Gurrola it had determined not to fill the gully due to excessive cost. Thus, irrespective of the presence of the erosion gully since February 2005, it was only as of March 2007 that Gurrola might claim the City had appropriated his property. Prior to that time, while the City was conducting a geotechnical assessment for the design and construction of the project, Gurrola could not determine 'the nature and extent of the taking.' (Mehl, supra, 13 Cal.3d at p. 717.) Accordingly, with respect to the cause of action for inverse condemnation, the demurrer on statute of limitations grounds should have been overruled."
In the final footnote in Gurrola I, we noted, "We express no opinion as to whether Gurrola is capable of pleading facts sufficient to constitute a cause of action for inverse condemnation. Further, because the operative first amended complaint, under the first cause of action (inverse condemnation), did not plead the required elements and merely noted the City's demurrer to the inverse condemnation claim in the original complaint had been overruled, we are not in a position to review the inverse condemnation claim for other possible defects. We merely hold the inverse condemnation claim is not demurrable on statute of limitations grounds and that Gurrola is entitled to leave to replead a cause of action for inverse condemnation." (Italics added.)
II. PROCEEDINGS ON REMAND
1. Second amended complaint.
On March 1, 2010, Gurrola filed the operative second amended complaint, which set forth a single cause of action for inverse condemnation. Gurrola reiterated his earlier factual allegations and pled the City had taken his property, entitling him to just compensation.
Gurrola pled in pertinent part: "In March 2007, the City completed design of the second phase of the project and it did not include repair of the gully area. On March 27, 2007, Bureau staff told [him] for the first time that the City had determined not to backfill the new storm drainpipe as well as the gully due to excessive cost. Thus, irrespective of the presence of the erosion gully since February 2005, it was only as of March 2007 that the City appropriated the Subject Properties by inverse condemnation. Prior to that time, while the City was conducting a geotechnical assessment for the design and construction of the project, Plaintiff could not determine the nature and extent of the taking."
Gurrola did not attempt to plead the City made an enforceable promise to restore the land, or that the City was estopped from taking the position on March 27, 2007, that it would not backfill the new storm drainpipe and gully due to excessive cost.
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2. Motion for judgment on the pleadings.
After filing an answer denying the allegations and asserting numerous affirmative defenses, the City filed a motion for judgment on the pleadings.
The basis of the motion was that Gurrola "is not the proper party to bring this lawsuit." The City contended a "fundamental principle in eminent domain and inverse condemnation proceedings is that compensation belongs to the person who suffered damage by the alleged taking or damage to real property at the time of the taking or damage." Here, "[t]hat damage occurred to the subject properties before Mr. Gurrola purchased them is undisputed. He observed the property conditions in August 2005; he conducted his due diligence; he spoke to City employees regarding future plans to repair the broken storm drain; and then he purchased the properties in their as is condition in September 2005. He cannot now bring suit for inverse condemnation against the City for the condition he voluntarily accepted and for a claim that did not belong to him when the storm drain ruptured."
3. Opposition papers.
Gurrola disputed the City's position that he lacks standing to sue for inverse condemnation. Gurrola emphasized that in Gurrola I, the appellate court held "that 'irrespective of the presence of the erosion gully since February 2005, it was only as of March 2007 that Gurrola might claim the City had appropriated his property. ' " Gurrola argued that Gurrola I established he suffered damage and that his cause of action accrued after he purchased the property in August 2005. Gurrola asserted that in view of Gurrola I, "it cannot be said that [he] lacks standing. He clearly has a personal interest in the outcome of this litigation."
4. Trial court's ruling.
On October 12, 2010, the matter came on for hearing. The trial court granted the City's motion for judgment on the pleadings, ruling the second amended complaint failed to state facts sufficient to constitute a cause of action.
This timely appeal followed.
CONTENTIONS
Gurrola contends: he has standing to sue; his cause of action and the statute of limitations began to run in March 2007, not in February 2005; even assuming the cause of action and the statute of limitations began to run in February 2005, his lawsuit is timely because the applicable limitations period is five years and he filed suit within five years of the February 2005 accrual date.
DISCUSSION
1. Standard of appellate review.
"The standard of review for a motion for judgment on the pleadings is the same as that for a general demurrer: We treat the pleadings as admitting all of the material facts properly pleaded, but not any contentions, deductions or conclusions of fact or law contained therein. We may also consider matters subject to judicial notice. We review the complaint de novo to determine whether it alleges facts sufficient to state a cause of action under any theory. [Citation.]" (Dunn v. County of Santa Barbara (2006) 135 Cal.App.4th 1281, 1298.)
2. Gurrola has no standing to sue for the damaged condition of the property which he purchased at a tax sale.
Gurrola I established the cause of action for inverse condemnation did not accrue until March 2007, in that despite the presence of the erosion gully as of February 2005, it was only as of March 2007, when the City determined it would not fill the gully, that Gurrola could determine the nature and extent of the taking.
However, leaving aside the accrual of the statute of limitations, the issue is whether it is Gurrola, or the prior owner, who had standing to sue for the damage to the property.
The taking or damaging by a governmental entity of a property owner's land renders the governmental entity liable in inverse condemnation for the resulting depreciation in value of the property. (Ricards, supra, 10 Cal.3d at p. 388.) The "right to recover this amount remains in the person who owned the property at the time of the taking or damaging, regardless of whether the property is subsequently transferred to another person. [Citations.]" (Id. at p. 389, italics added.)
In Ricards, "the destruction of [a] bridge constituted a taking or damaging of the owner's property rights of access within the meaning of article I, [former] section 14, of the California Constitution. She therefore became entitled to just compensation, and would have remained entitled to recompense even if she had sold the property before the damage was cured. Had such a sale occurred, the amount by which the selling price was reduced because of the impairment of access would have represented the damages caused by the destruction of the easement and would have been recoverable from the City. . . . Because the City would thus have been liable for any reduction in selling price caused by the impairment of access, the owner was capable of selling her property during the two-year interim without fear of financial loss." (Ricards, supra, 10 Cal.3d at p. 389, italics added.)
In the instant case, assuming arguendo there was a taking based on the damage to the land, just compensation damages would have been recoverable by the owner of record at the time the property was damaged in 2005. It is the previous owner who would have suffered a reduction in the sale price of the property if the land were sold in its damaged condition. The City would have been liable to the previous owner for the reduction in selling price caused by the presence of the erosion gully. (Ricards, supra, 10 Cal.3d at p. 389.)
Here, Gurrola admitted in his pleadings that the lots were damaged before he bought them, and that he discovered the eroded gully "as part of his due diligence," before he purchased the lots. Presumably, the amount Gurrola paid for the lots at the tax sale reflected his opinion of the value of the land in its degraded condition. Because Gurrola acquired the lots in their damaged condition, he was not the proper party to sue for inverse condemnation.
DISPOSITION
The judgment is affirmed. The parties shall bear their respective costs on appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
KLEIN, P.J. We concur:
CROSKEY, J.
ALDRICH, J.