County of Orange v. Heim

• Decision Date: 21 February 1973
• Citation: 30 Cal.App.3d 694,106 Cal.Rptr. 825
• Court: California Court of Appeals Court of Appeals
• Parties: COUNTY OF ORANGE et al., Plaintiffs and Respondents, v. V. A. HEIM, as County Auditor of the County of Orange, Defendant and Appellant. STATE of California ex rel. STATE LANDS COMMISSION, Real Party in Interest and Respondent, v. Frank ROBINSON et al., Interveners and Appellants. Civ. 11832.

Page 825

106 Cal.Rptr. 825

30 Cal.App.3d 694

COUNTY OF ORANGE et al., Plaintiffs and Respondents, v. V. A. HEIM, as County Auditor of the County of Orange, Defendant and Appellant.

STATE of California ex rel. STATE LANDS COMMISSION, Real Party in Interest and Respondent, v. Frank ROBINSON et al., Interveners and Appellants.

Civ. 11832.

Court of Appeal, Fourth District, Division 2, California.

Feb. 21, 1973.

As Modified on Denial of Rehearing March 12, 1973.

[30 Cal.App.3d 698] Kaplan, Livingston, Goodwin, Berkowitz & Selvin, and Peter Smoot and Herman F. Selvin, Beverly Hills, for appellant V. A. Heim.

Phillip S. Berry, Oakland, for appellants Frank and Frances Robinson, et al.

Gibson, Dunn & Crutcher and Robert S. Warren, Los Angeles, for respondent The Irvine Co.

Evelle J. Younger, Atty. Gen., and Jay L. Shavelson, Asst. Atty. Gen., for respondent State of California.

OPINION

KAUFMAN, Acting Presiding Justice.

The Case

This proceeding was commenced in the lower court as a 'friendly suit' (see 2 Witkin, Cal. Procedure (2d ed.) pp. 913--915) to establish the validity of a land exchange agreement and accompanying dredging and landfill agreement made between the County of Orange (County) and The Irvine Company (Irvine) in connection with a plan (hereinafter the Plan) for the development of Upper Newport Bay (UNB) as a harbor. It has developed into a truly adversary litigation of substantial proportions.

By amended pleadings, County, Irvine and the Orange County Harbor District (Harbor District), which joined as a copetitioner, sought a writ of mandate to compel the Orange County Auditor (Heim) to issue a warrant for payment of County's agreed share of engineering costs incurred in a soils investigation study made pursuant to the land exchange agreement and dredging and landfill agreement as amended. Also sought were declarations that the several agreements are valid and in compliance with the enabling legislation and the California Constitution. The State of California (State) acting by and through its State Lands Commission (SLC) ¹ joined as a real party in interest (See Pub. Resources Code, § 6308), admitted the allegations of the amended petition and joined in the prayer for relief. Heim answered denying the essential allegations of the amended petition and sought a declaration that the enabling legislation and the agreements were unconstitutional, invalid and unenforceable. By leave of the court Frank and Frances Robinson, Harold and Joan Coverdale and Wesley and Judith Marx (Intervenors), residents of Orange County, filed a complaint in intervention also asserting the invalidity of the enabling legislation and the several agreements.

Following a trial to the court of some 28 trial days, during which the court heard testimony of some 20 witnesses and received more than 100 exhibits and made 2 inspections of UNB, one by boat and one by automobile, the court rendered a thoughtful memorandum opinion (later modified), made extensive findings of fact and conclusions of law and, on February 11, 1971 gave judgment for petitioners as prayed. ² Heim and Intervenors (collectively appellants) appeal from the judgment. ³

Pertinent Facts

UNB is a portion of a single bay known as Newport Harbor or Newport Bay. It is that portion of the greater harbor which extends north of the Pacific Coast Highway and it and its tidelands are now located entirely within the limits of the City of Newport Beach and within the area encompassed by Harbor District.

In 1901, James Irvine, predecessor in interest to Irvine Company, received from the State of California a tidelands patent to some 243 acres of tidelands lying at the upper end of UNB (hereinafter the patented tidelands). Irvine is the fee owner of these patented tidelands, but its fee ownership is subject to a public easement and right generally referred to as the public easement or trust for navigation, commerce and fishing. (See Marks v. Whitney, 6 Cal.3d 251, 258--259, 98 Cal.Rptr. 790, 491 P.2d 374; City of Long Beach v. Mansell, 3 Cal.3d 462, 482, 91 Cal.Rptr. 23, 476 P.2d 423; Newcomb v. City of Newport Beach, 7 Cal.2d 393, 401, 60 P.2d 825; People v. California Fish Co., 166 Cal. 576, 596, 138 P. 79.) ⁴ Irvine also claims to be ⁵ the fee owner of three islands, comprising 103.3 acres of uplands, lying astride the channel of UNB as well as substantially all of the uplands contiguous to UNB and its tidelands. ⁶

By chapter 526, Statutes of 1919 as amended by chapter 575, Statutes of 1929 ⁷ (the granting statutes) the State granted to County, in trust, the tidelands and submerged lands bordering upon and under UNB then outside the city limits of Newport Beach. These lands, although technically a combination of tidelands and submerged lands (see City of Long Beach v. Mansell, Supra, 3 Cal.3d at p. 478, fn. 13, 91 Cal.Rptr. 23, 476 P.2d 423), will hereinafter be referred to as the granted tidelands or the County tidelands. They comprise some 403.7 acres.

The granting statutes specifically provide that the grant from the State to the County is made for the purpose of the County's establishing, improving and conducting a public harbor and related facilities without expense to the State. They further provide that, except for franchises or leases not to exceed 50 years, 'said county or its successors shall not at any time grant, convey, give or alien said lands or any part thereof to any individual, firm, or corporation for any purposes whatever.'

To this date County has not been able to implement the purpose expressed in the granting statute, developing UNB as a harbor. Although all of the granted tidelands area is at one time or another covered by water, only a portion of the area is actually navigable. The main channel is blocked by the three islands owned by Irvine, which leave only small, winding channels, creating congestion for boats and limiting large scale public recreational use. Other impediments to full harbor development are limited access due to the fact that precipitous bluffs surround much of the bay and that Irvine owns nearly all of the contiguous uplands. ⁸ Portions of these uplands have steadily been developed with homes and apartments, thus restricting their availability for use in connection with public planning for a harbor, and at all times during the development of the Plan and its approval, Irvine consistently indicated its intention to develop the three islands owned by it in the channel.

Over the past 45 years, commencing in 1925, a number of studies have been made concerning the development of UNB as a harbor. Each study acknowledge the necessity of dredging away the Irvine-owned islands to widen the existing channel. Most, if not all, of the studies envisioned an alienation or exchange of granted tidelands for the Irvine-owned islands and portions of the contiguous uplands.

In view of the prohibition against alienation of the granted tidelands in the granting statutes, effectuation of any such plan required legislative authorization. Legislation to this end was introduced in the Legislature in 1939, 1941, 1951 and 1957. By chapter 2044 of the Statutes of 1957 (hereinafter chapter 2044 or the enabling act), the Legislature purported to authorize the development of UNB as a harbor by the utilization of some such plan or land exchange. This enabling act recites that, in the course of the improvement and development of Newport Bay as a harbor, portions of the granted tidelands have been (section 1) or may in the future be (section 2) filled and reclaimed and thereby excluded from the public channels and declares that such lands are (section 1) and will be (section 2) no longer 'available or useful or susceptible of being used for navigation, commerce, and fishing' and are (section 1) or 'when so improved, filled and reclaimed,' will be deemed (section 2) 'free from the public use and trust for navigation, commerce, and fishery.' Section 3 of the act purports to permit the conveyance of the tidelands thus freed from the public trust into private ownership in exchange for privately owned contiguous uplands with the approval and concurrence of the SLC after findings by the SLC 'that the lands located in . . . Upper Newport Bay which are to be exchanged are no longer useful for navigation, commerce, and fishing, and that the lands to be received in exchange are at least of equal value thereto.' Section 3 further specifies that the land received by County in exchange 'shall be used by the county only for purposes of state-wide interest.'

Following enactment of chapter 2044, County, Harbor District and Irvine proceeded to attempt to devise a final plan for the development of an improved harbor in the UNB. After many public hearings. consultation with recognized experts and affected public agencies and after consideration of all the prior planning and modification of several proposed plans, County, Harbor District and Irvine finally settled on the Plan entitled 'Upper Newport Bay Land Exchange Plan,' dated March 31, 1964. ⁹ Pursuant to the Plan, on January 13, 1965, County, Harbor District and Irvine entered into the land exchange agreement and the dredging and landfill agreement challenged in this proceeding.

The Plan envisions the creation of a navigable waterway averaging 800 feet in width extending about 2.5 miles north from the Pacific Coast Highway bridge, which is to be reconstructed at a higher level. At the north end of the granted (County) tidelands, the waterway would widen into a turning basin. Beyond this, mainly on what are now patented (Irvine) tidelands, there would be a mile-long rowing course and a marine stadium separated by a long, somewhat narrow arm of public park land fronted by a swimming beach. To the north of the marine stadium, the general use diagram attached as appendix VIII to the Plan depicts additional public park land with boat launching facilities. About halfway between the north and south ends of...