Regents of University of Cal. v. Morris

• Decision Date: 18 October 1968
• Citation: 266 Cal.App.2d 616,72 Cal.Rptr. 406
• Court: California Court of Appeals Court of Appeals
• Parties: The REGENTS OF the UNIVERSITY OF CALIFORNIA, a corporation, Plaintiffs, Appellants and Respondents, v. B. R. MORRIS and Estelle Morris, Defendants, Respondents and Appellants. Civ. 30694.

Page 406

72 Cal.Rptr. 406

266 Cal.App.2d 616

The REGENTS OF the UNIVERSITY OF CALIFORNIA, a corporation, Plaintiffs, Appellants and Respondents, v. B. R. MORRIS and Estelle Morris, Defendants, Respondents and Appellants.

Civ. 30694.

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

Oct. 18, 1968.

Rehearing Denied Nov. 13, 1968.

Hearing Denied Dec. 11, 1968.

Thomas J. Cunningham, John P. Sparrow, Berkeley, Musick, Peeler & Garrett, George C. Hadley, Los Angeles, for plaintiff Regents.

Fadem & Kanner, by Gideon Kanner, Los Angeles, for defendants, Morris.

ROTH, Presiding Justice.

B. R. Morris and Estelle Morris, husband and wife, (Morris) appeal from a judgment of $3,700,000 rendered in their favor in an eminent domain proceeding wherein the Regents of the University of California (Regents) condemned as public grounds of the university the Morris apartment and warehouse property located approximately five miles from the campus. Specifically, the property was condemned for use as a housing facility for married students and junior faculty members.

The Morris property had been part of a single complex of 647 apartment units situated between Sawtelle and Sepulveda Boulevards in West Los Angeles. The units were jointly owned by appellants Morris and Mr. E. K. Zuckerman, until they terminated their business association as of January, 1963. Pursuant to the termination, Morris took the property which is the subject of this lawsuit, to wit: a warehouse and 315 units (238 built in 1948 and 77 in 1958), of which 52 fronted on Sawtelle and the remaining 263 on Sepulveda. Mr. Zuckerman took 332 units, thereafter known as Park Vista Apartments (208 built in 1948 and 124 built in 1958) all fronting on Sawtelle.

Prior to this action Regents had, in what they claim was an arms-length sale, purchased the Zuckerman property for $3,500,000. The Zuckerman property is of importance because the use or abuse by Regents of the sales price of the Zuckerman property and whether and what the Regents term 'a mirror sale' was a voluntary transaction, is one of the many grounds on which the Morris appeal is predicated.

Regents cross-appeal on the ground that they were, by reason of an entered judgment and recorded final order, entitled to possession of the condemned property on April 14, 1965, and therefore to rents, issues and profits therefrom to the date when they took actual possession on July 16, 1965 of the rental units and from April 14, 1965 to August 1, 1965, the date when they took actual possession of the warehouse.

We treat the cross-appeal of Regents first.

The sequence of events was as follows:

April 4, 1965, the jury returned a verdict awarding Morris the sum of $3,700,000 for the condemned property.

April 8, 1965, findings of fact and conclusions of law were settled by the court and filed.

April 9, 1965, the judgment for the total sum of $3,700,000 was entered.

The pertinent part of Finding VIII which is herein questioned, is as follows:

'It is * * * stipulated * * * that all rents shall be pro-rated as Of the date of taking possession by plaintiff.' (Emphasis added.)

As originally submitted by Regents, said portion of Finding VIII read as follows:

'It is * * * stipulated * * * that all rents shall be pro-rated as Of the date of the recording of the Final Order of Condemnation herein.' (Emphasis added.)

April 9, 1965, the judgment for the total sum of $3,700,000 was entered. In pertinent part it decreed:

'* * * that payment to the court of the sum * * * shall be in full * * * for the real property * * * so taken in fee simple absolute * * *.'

On the same day the Regents deposited the total sum of the judgment.

April 12, 1965, final order of condemnation was signed and filed.

April 13, 1965, said final order was entered.

On April 14, 1965, said final order was recorded in the Office of the County Recorder.

In pertinent part the final order '* * * DECREED that the * * * real property be, * * * condemned in fee simple asbolute to become the property of plaintiff * * *.'

It also provided:

'AND IT IS FURTHER ORDERED that all rents shall be prorated as of the date of taking possession by Plaintiff.'

The Regents predicate their right to possession as of April 14, 1965 and their right to prorate rents, issues and profits as of that date, on those portions of the judgment and final order awarding and confirming the subject property to Regents in fee simple absolute and on the contention that the pertinent portion of Finding VIII as originally submitted, had so provided by stipulation, which was ignored by the court.

In support of Regents' position, the record shows without dispute that the amount of the judgment had been deposited as required; taxes had been prepaid by Regents on the condemned property from April 14 to June 30, 1965 and that by deposit in court of the judgment amount which included payment in full of all encumbrances on the subject property as of April 14, 1965, all interest charges on said encumbrances had been eliminated.

Morris contend the stipulation was to the contrary and resulted in the finding as signed by the court.

Morris in their brief concede that 'the Regents had the power to take possession of the subject property at any time after judgment (C.C.P. § 1254). All the Regents had to do was to deposit in court the sums required by law. See C.C.P. § 1254(a). Thereupon, the Regents could have taken possession in 10 days. See C.C.P. § 1254(b) and (c). But instead the Regents did nothing for approximately three months.'

We find no substantial evidence to support a stipulation upon which the Finding as proposed or as signed was made.

Abundant evidence indicates that there was no agreement between the parties for possession of the subject property or for the manner of prorating rents, issues and profits or any other obligations in respect of possession.

The record in fact shows that Morris did not desire to continue to operate the property and was willing to waive the formal 10-day notice, and that the parties entered into an aborted oral stipulation that Regents have possession as of May 1, 1963.

It is clear from the proceedings subsequent to April 8, 1965, the date findings were settled and filed that Regents had full knowledge that the stipulation in respect of proration as of April 14, 1965, had not been accepted by Morris or the court and that it was not practical for the Regents to take possession of the rental units on April 14, 1965, or even immediately thereafter. Regents in fact participated in proceedings prior to April 14 and after that date to arrange to take possession on an entirely different date.

On April 8, counsel for Regents said:

'* * * that administratively it might be just as well both for the University and for adversary, to have this matter of possession, if it is granted, granted at a time when it is near the first of the month. * * *.'

'* * *.hat

'* * * (The Regents) would probably like a target date of around May 1st.

'* * *.The

'MR. FADEM: The code provides if you want to make it May 1st, you have got to serve the order on us at least 10 days in advance of that.

'MR. HADLEY: That is right.

'MR. FADEM: So that means you would have to present an order for immediate possession before April 20, * * *.

'MR. HADLEY: That is right.'

Later, in respect of possession, the following took place:

'MR. DREW: Our client, your Honor, wants possession on May 1st. They have paid the $3,700,000 * * * they have nothing to show for it. * * * (T)hey are entitled to possession. They have legal title to the property and--

'THE COURT: All right. However, so far as the 10-day provision is concerned, you would waive that, would you?

'MR. FADEM: Day by day.

'THE COURT: Day by day.

'MR. FADEM: Except one further thing, the warehouse. The warehouse is a special problem.'

In the same discussion the following took place:

'MR. FADEM: * * * I think what is happening here is that the Regents are trying to put pressure on the Court * * *. We are giving on this 10-day notice. They can give on the warehouse. They have no need for it.

'THE COURT: I think it would be a very nice thing if they would permit you to use the warehouse for a reasonable time to permit you to adjust your affairs, but I don't think the Court can say you can have possession of this and not of that. * * *.

'* * *.RT:

'THE COURT: * * * if I decide on next Monday, we will say, that they have the right, they will go into possession on May 1st, if that is the stipulation. Is that satisfactory to you?

'MR. DREW: Yes, that is stipulated.

'Is that stipulated?

'MR. FADEM: Yes.'

It appears from a subsequent hearing that the proposed stipulation for possession on May 1st had never been acted upon; counsel for Morris advised the court:

'I might inform the Court nothing further has happened in regard to possession since the abortive preparations we made to turn over possession on May 1st. I don't want to depart from the but * * * the Court does have before, the indications of the preparations that we were * * * going on with University personnel * * * and our waiver of the ten days' time.

'THE COURT: So that Mr. and Mrs. Morris are still in possession and operating it?

'* * *.'T:

The abandonment by all parties of May 1st as the date of possession is verified by subsequent statements in the record. Counsel for Morris said:

'* * * after we agreed to waive the ten days' notice * * * for taking possession on May 1st, that on the Friday before the Tuesday that possession was supposed to take place, while in fact the representatives of the University were in the office of Mr. Morris negotiating the details of the turn-over of possession, in the middle of that afternoon we were notified by Mr. Hadley that the University was not going to take possession. That point I think the Court knew, but I don't think it appears on the record.'

In the same discussion from which the above excerpt is...