O'Hagan v. Board of Zoning Adjustment

• Decision Date: 23 April 1974
• Citation: 38 Cal.App.3d 722,113 Cal.Rptr. 501
• Parties: Henry O'HAGAN, Plaintiff and Appellant, v. BOARD OF ZONING ADJUSTMENT OF the CITY OF SANTA ROSA et al., Defendants and Respondents. Civ. 31833.
• Court: California Court of Appeals

Page 501

113 Cal.Rptr. 501

38 Cal.App.3d 722

Henry O'HAGAN, Plaintiff and Appellant, v. BOARD OF ZONING ADJUSTMENT OF the CITY OF SANTA ROSA et al., Defendants and Respondents.

Civ. 31833.

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

April 23, 1974.

Hearing Denied June 19, 1974.

John E. Olmsted, Santa Rosa, for plaintiff and appellant.

John D. Flitner, City Atty., Santa Rosa, Michael J. Donovan, Asst. City Atty., Santa Rosa, for defendants and respondents.

KANE, Associate Justice.

Plaintiff Henry O'Hagan appeals from a summary judgment denying him recovery for damages in a mandamus action.

The pertinent facts reveal that on February 8, 1961, one Vernon Rose ('Rose'), the owner of the property located at 1207 Fourth Street in Santa Rosa, applied for a use permit for the purpose of constructing a drive-in restaurant at said location. On February 16, 1961, the Board of Zoning Adjustment ('Board') issued a temporary use permit. The use permit specifically stated that the establishment, maintenance or operation of the use applied for would not be detrimental to the health, safety, peace, morals, comfort and general welfare of the persons residing in the neighborhood or to the general welfare of the city. The use permit was reissued on February 21, 1963, and upon the above stated conditions it was renewed on a permanent basis on March 17, 1966.

On March 1, 1967, Rose leased the premises to appellant for a term of 10 years. Appellant used the premises to operate a drive-in restaurant named the 'Burger King.' Both before and after the execution of the lease complaints were received by the city with regard to the operation and activities of the 'Burger King.' In order to remedy the situation, meetings and hearings were held. On February 15, 1968 appellant consented to a resolution of the Board limiting the operation of his business from 11 a.m. to 9 p.m. for a period of six months. The resolution contained other conditions pertaining to the physical condition of the drive-in to which appellant also agreed. On August 15, 1968, the Board passed another resolution increasing the hours of operation from 9 a.m. to 10 p.m. during daylight saving time but reverting back to the original closing hour of 9 p.m. upon the return to standard time. On August 29, 1968 appellant filed an appeal with the city council refusing to continue with the closing hours established in the August 15, 1968 resolution. On September 10, 1968 the city council referred the matter to the Board. After a hearing held on September 26, 1968, the Board revoked appellant's use permit on the ground that the operation of the business constituted a public nuisance (Santa Rosa Zoning Ordinance, art. IV, § 61 ('Ordinance')). Appellant appealed the decision to the city council which affirmed the decision of the Board on October 1, 1968.

Appellant nonetheless continued to operate his business and on October 31, 1968, an action to abate a public nuisance was filed by the city against appellant. During the pendency of the nuisance action, on February 18, 1969, appellant filed a petition for a writ of mandamus under Code of Civil Procedure, section 1094.5, requesting that the decision of the Board be set aside. On June 12, 1969, a judgment in the nuisance action was handed down holding that several conditions of the operation of the 'Burger King' constituted a public nuisance but that the nuisance could be controlled if the conditions were rectified. That judgment was not appealed.

On November 13, 1969, the superior court denied appellant's petition for a writ of mandamus. On appeal, this court reversed the lower court's judgment on the ground that the trial court should have given Res judicata effect to the decision rendered in the nuisance action (O'Hagen v. Board of Zoning Adjustment (1971) 19 Cal.App.3d 151, 96 Cal.Rptr. 484).

On November 8, 1971, pursuant to stipulation by counsel, appellant was granted leave to amend his original mandamus petition to add a claim for damages allegedly arising from loss of good will, profit, employment and from incurring financial obligations (taxes, legal fees, loans, insurance premiums, etc.). Respondents thereafter filed a motion for summary judgment which was granted on the basis that the governmental tort immunity as a matter of law barred appellant's claim to any possible damages resulting from the revocation of the use permit.

Thus, the issue before us, broadly stated, is whether a public entity may be held liable for damages arising from an allegedly wrongful revocation of a use permit.

In answering this question, we point out that codifying the law existing prior to the 1963 California Tort Claims Act ('Tort Claims Act') (Lipman v. Brisbane Elementary School District (1961) 55 Cal.2d 224, 11 Cal.Rptr. 97, 359 P.2d 465; Hardy v. Vial (1957) 48 Cal.2d 577, 311 P.2d 494; White v. Towers (1951) 37 Cal.2d 727, 235 P.2d 209), Government Code, ¹ section 820.2, grants a general immunity to public employees for injuries resulting from an exercise of discretion vested in them even if the discretion is abused. ² Section 821.2, in turn, specifically designates licensing activities as discretionary, providing that 'A public employee is not liable for an injury caused by his issuance, denial, suspension or Revocation of, or by his failure or refusal to issue, deny, suspend or revoke, Any permit, license, certificate, approval, order, or similar authorization Where he is authorized by enactment to determine whether or not such authorization should be issued, denied, suspended or Revoked.' (Emphasis added.)

In the case at bench, the use permit was revoked by respondents pursuant to the Ordinance, which provided in part that 'Use permits may be revoked by the Planning Commission for breach of condition or other good cause upon notice and hearing.' Since under section 810.6 enactment means, among other things, ordinance or regulation, the revocation of the use permit was clearly authorized under section 821.2.

We further note that general immunity for discretionary acts and specific immunity for licensing activities are also provided for the public entities. While section 815 2, subdivision (b), ³ accords a derivative immunity to the public entity if its employees are exempted from liability, section 818.4 clothes the public entity with specific immunity for licensing activities. This latter section provides that 'A public entity is not liable for an injury caused by the issuance, denial, suspension or Revocation of, or by the failure or refusal to issue, deny, suspend or revoke, Any permit, license, certificate, approval, order, or similar authorization Where the public entity or an employee of the public entity is authorized by enactment to determine whether or not such authorization should be issued, denied, suspended, or Revoked.' (Emphasis added.)

Thus, it is plain that under the Tort Claims Act injuries stemming from the issuance, denial, revocation or suspension of licenses, permits and similar official authorizations are excluded from the scope of tort liability of entities and employees. This statutory immunity is so strong that it even prevails over the liability imposed by section 815.6 for failure to discharge a mandatory duty (Van Alstyne, Cal. Government Tort Liability (Cont.Ed.Bar, 1964), § 5.58 at p. 165). It follows therefore that under the authorities cited above both the public employees who exercised their discretion in the numerous proceedings which culminated in the revocation of appellant's use permit and respondents were Ipso jure immune from liability for damages arising from the revocation of the permit in question.

Appellant contends, however, that in the case at bar the immunities granted in the Tort Claims Act are inapplicable because (1) he obtained a vested property right in the use permit which could not be revoked; (2) the injuries referred to in the Tort Claims Act embrace only personal injuries not property rights; and (3) at any rate under section 1095 of Code of Civil Procedure damages are recoverable for prejudicial abuse of discretion by an administrative agency. We disagree.

It is conceded that where, as here, a permit has been properly obtained and in reliance thereon the permittee incurred material expense, the permittee acquires a vested property right to the protection of which he is entitled (Trans-Oceanic Oil Corp. v. Santa Barbara (1948) 85 Cal.App.2d 776, 784--787, 194 P.2d 148). However, contrary to appellant's proposition, a vested right is far from being irrevocable. It is well established that a vested right may indeed be revoked if the permittee fails to comply with reasonable terms or conditions expressed in the permit (Trans-Oceanic Oil Corp. v. Santa Barbara, supra, p. 783, 194 P.2d 148; Brougher v. Board of Public Works (1928) 205 Cal. 426, 433, 271 P. 487) or if there is a compelling public necessity (Jones v. City of Los Angeles (1930) 211 Cal. 304, 314, 295 P. 14). Compelling public necessity warranting the revocation of a use permit may exist where the conduct of the business constitutes a nuisance (O'Hagen v. Board of Zoning Adjustment, supra, 19 Cal.App.3d at p. 158, 96 Cal.Rptr. 484). In the case at bench, the city revoked the use permit pursuant to the Ordinance for 'good cause' and on a showing that the operation of Burger King constituted a public nuisance (cf. O'Hagen v. Board of Zoning Adjustment, supra at p. 161, 96 Cal.Rptr. 484).

Appellant's attempt to classify the right in the use permit as a non-conforming use or variance is unavailing. A variance is not entitled to greater protection than a vested property right and it may also be revoked for good cause, viz., menance to the health, welfare or safety of the public, etc. (cf. Tustin Heights Assn. v. Board of Supervisors (1959) 170 Cal.App.2d 619, 626--627, 339 P.2d 914).

Appellant's next argument that the injuries contemplated by the Tort Claims Act encompasses only...