Hansen Brothers Enterprises, Inc. v. Board of Supervisors, S044011

• Court: United States State Supreme Court (California)
• Writing for the Court: BAXTER; LUCAS, C.J., and ARABIAN; WERDEGAR; LUCAS; MOSK; KENNARD; GEORGE
• Citation: 12 Cal.4th 533,48 Cal.Rptr.2d 778
• Parties: , 907 P.2d 1324, 96 Cal. Daily Op. Serv. 186, 96 Daily Journal D.A.R. 300 HANSEN BROTHERS ENTERPRISES, INC., Plaintiff and Appellant, v. BOARD OF SUPERVISORS OF NEVADA COUNTY et al., Defendants and Respondents.
• Docket Number: No. S044011,S044011
• Decision Date: 08 January 1996

Page 778

48 Cal.Rptr.2d 778 12 Cal.4th 533, 907 P.2d 1324, 96 Cal. Daily Op. Serv. 186, 96 Daily Journal D.A.R. 300 HANSEN BROTHERS ENTERPRISES, INC., Plaintiff and Appellant,
v.
BOARD OF SUPERVISORS OF NEVADA COUNTY et al., Defendants and Respondents. No. S044011. Supreme Court of California. Jan. 8, 1996.
Rehearing Denied Feb. 29, 1996.

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[907 P.2d 1327] Appeal from Superior Court, Nevada County; Reginald Littrell ^*, Judge.

[12 Cal.4th 540] Deipenbrock, Wulff, Plant & Hannegan, The Diepenbrock Law Firm, John V. Diepenbrock and Mark D. Harrison, Sacramento, for Plaintiff and Appellant.

James S. Burling and Daniel T. Fitzpatrick, Sacramento, as Amici Curiae on behalf of Plaintiff and Appellant.

James A. Curtis, County Counsel, and Harold E. DeGraw, Chief Deputy County Counsel, for Defendants and Respondents.

H. Peter Klein, County Counsel, Mendocino, Frank Zotter, Jr., Deputy County Counsel, Dwight L. Herr, County Counsel, Santa Cruz, Jonathan Wittwer, Chief Deputy County Counsel, Shute, Mihaly & Weinberger and Fran M. Layton, San Francisco, as Amici Curiae on behalf of Defendants and Respondents.

BAXTER, Justice.

The principal issue in this case is whether the "diminishing asset" doctrine is applicable

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[907 P.2d 1328] to a mining operation which is carried on as a legal nonconforming use ¹ under a zoning ordinance that presently excludes mining from the permissible uses of the property. The 1954 Nevada County land use and development ordinance which governs the property that is the subject of this dispute also forbids continuation of nonconforming uses which have ceased operation for periods in excess of 180 days. Therefore, because the "mining operation" at issue is part of an aggregate production business, we must also decide whether the aggregate business itself, including all aspects of that business, is the nonconforming use, or if the individual mining operations which recover the aggregate components--sand, gravel, and rock taken from a riverbed and its banks and rock quarried from a hillside--are the nonconforming use which the owner has a vested right to continue.

[12 Cal.4th 541] The question of whether the diminishing asset doctrine is recognized in California arises because, under both the express terms of the Nevada County zoning ordinance ² and generally applicable rules governing the continuation of a nonconforming use, that use may not expand onto areas of the property that were not being used at the time the zoning ordinance became effective. Resolution of the question is complicated in this case because the mining operations at the Bear's Elbow Mine owned and operated by plaintiff Hansen Brothers Enterprises, Inc. (Hansen Brothers), are for materials that are not distributed uniformly throughout the property and none is mined continuously. One, the removal of gravel and rock from the riverbed and its adjacent bank area is for a type of rock and gravel that was once a replenishing resource. The other mining operation has been to quarry the "hillside" about 600 feet from the river for rock. ³ That area has contributed relatively small amounts of rock to the aggregate produced on the property in the past. Under plaintiff's proposal for future development, rock quarrying farther into the hillside of the property away from the river will constitute the principal source of the crushed rock component of the aggregate produced from materials on the property.

The principles that govern this area of law, while arcane, are important to both surface mining enterprises ⁴ and the industries that

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[907 P.2d 1329] are dependent on their output. They are also of great concern to local governmental officials [12 Cal.4th 542] charged with responsibility to eliminate nonconforming uses of properties under their jurisdiction. ⁵

The Court of Appeal held that Hansen Brothers' proposal for future mining constituted an impermissible intensification of the nonconforming use. It therefore affirmed the judgment of the superior court, which had denied a petition for a peremptory writ of mandate to set aside a decision of the Nevada County Board of Supervisors (the Board) denying approval of the mining plan. The Board had concluded that, while Hansen Brothers had a vested right to mine a portion of its property, any right it might have had to quarry the hillside area of its property for rock had been lost by discontinuance for periods in excess of 180 days, and that Hansen Brothers' proposal for future mining constituted an impermissible intensification of the nonconforming use. Because the Court of Appeal agreed with the last conclusion, it did not address the questions related to the nature of plaintiff's nonconforming use, whether the right to continue the nonconforming use had been lost under the cessation provision of the ordinance, or whether the scope of a vested right to mine extends over the entire parcel.

We conclude that the diminishing asset doctrine is recognized in California. We also conclude that the nonconforming use which Hansen Brothers may claim a right to continue is the aggregate production business that was being operated on the property its predecessors owned in 1954 when the Nevada County zoning ordinance was adopted. That business, and the nonconforming use, include all aspects of the operation that were integral parts of the business at that time, including mining replenishable materials from the riverbed and banks and quarrying rock from the hillside; crushing, combining, and storing the mined materials which compose aggregate; and selling or trucking the aggregate from the property. Consistent with the diminishing asset doctrine applicable to extractive operations, the right of normal expansion of a nonconforming use in this case includes extending the rock quarry aspect of the business to those other areas of the property owned in 1954 into which the owners had then objectively manifested an intent to mine in the future. ⁶

We reach these conclusions on the basis of undisputed evidence in the record that Hansen Brothers' predecessors in interest were operating the [12 Cal.4th 543] aggregate business, including extraction of sand and gravel from the riverbed and quarrying the hillside area of the property for rock in 1954. Nonetheless, the record is inadequate to permit us, or the lower courts and administrative bodies to determine (1) whether the nonconforming use which Hansen Brothers claims a vested right to continue extends to all of the Nevada County property it identifies as the Bear's Elbow Mine and over which it claims a vested right to continue operations, or (2) the extent of the area over which an intent to quarry for rock was objectively manifested in 1954.

We also conclude that the evidence does not support the rulings of the Court of Appeal and the superior court that Hansen Brothers' proposal for future rock quarrying would be an impermissible intensification of the nonconforming use of its property. Finally, we conclude that the evidence supports

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[907 P.2d 1330] the finding of the superior court that Hansen Brothers' overall aggregate production business has not been discontinued. Therefore Hansen Brothers has not lost the right to continue and expand its quarrying activity as an integral part of that nonconforming use, but the right is limited to the area over which the owners objectively manifested an intent to expand the quarry in 1954.

Nonetheless, as we explain below, because a court cannot determine on this record that Hansen Brothers is entitled to the relief it seeks, the petition for writ of mandate to compel the Board to approve a Surface Mining and Reclamation Act of 1975 (§ 2710, et seq.) reclamation plan for the Hansen Brothers' property was properly denied by the superior court. However Hansen Brothers is entitled to have the order denying approval of the plan set aside and to have its application reconsidered. We shall therefore reverse the judgment of the Court of Appeal affirming the superior court judgment denying Hansen Brothers' petition for writ of mandate, but we shall do so with directions that on setting aside its judgment the superior court conduct further proceedings. (See Code Civ.Proc., § 1094.5, subd. (e).)

I

Background

Hansen Brothers owns and operates the Bear's Elbow Mine, an aggregate business in which the materials combined and sold as aggregate are obtained by surface mining and quarrying on part of a 67-plus acre tract of land [12 Cal.4th 544] comprised of several parcels. Most of the property on which the business operates lies in Nevada County. Seven acres are in Placer County. The property straddles the Bear River, which at that location forms the boundary between the two counties, and includes property at the confluence of Willow Creek and the Bear River. The property is in a remote, mountainous area northwest of Colfax and south of Grass Valley. It is made up of riverbed, adjacent hillsides, and a flat yard area which is used for processing and storage. Recently a few homesites have been developed near the mine.

The aggregate produced at the Bear's Elbow Mine is sold for road building, concrete, filters and water purification systems, and other uses. Prior to construction of the Rollins Reservoir Dam on the river upstream from Bear's Elbow Mine, most of the rock, sand, and gravel used for the aggregate was taken from the riverbed and banks where the flow of the river replenished the supply and the cost of extraction was lower than on the hillsides, which have been held in reserve and are, therefore, largely unexcavated. Some quarrying for rock took place on both the Placer County and Nevada County hillsides within a few hundred feet of the Bear River, however. The rock is mixed with the riverbed aggregate materials as needed to meet buyers' specifications. Some sales are of blended materials from the riverbed, the banks of the river, and the hillside. In others the...