Riddle v. Vallely, G057397

• Court: California Court of Appeals
• Writing for the Court: GOETHALS, J.
• Parties: SUSAN [BIDART] RIDDLE, as Trustee, etc., Plaintiff and Appellant, v. JOHN VALLELY et al., Defendants and Respondents.
• Docket Number: G057397
• Decision Date: 01 September 2020

SUSAN [BIDART] RIDDLE, as Trustee, etc., Plaintiff and Appellant,
v.
JOHN VALLELY et al., Defendants and Respondents.

G057397

COURT OF APPEAL OF THE STATE OF CALIFORNIA FOURTH APPELLATE DISTRICT DIVISION THREE

September 1, 2020

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

(Super. Ct. No. 30-2015-00808124)

OPINION

Appeal from a judgment of the Superior Court of Orange County, Layne H. Melzer, Judge. Affirmed.

Claremont Land Group, Geralyn L. Skapik, Mark C. Allen III and Blair J. Berkley for Plaintiff and Appellant.

Law Office of Harry S. Carmack and Harry S. Carmack for Defendants and Respondents.

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This is a dispute between neighboring property owners on Balboa Island in the City of Newport Beach (the City). The City leased the tidelands in front of the properties to one of the property owners, who operates a commercial pier that extends in front of both properties. The other property owner asserts the City improperly issued the lease and complains the pier "encroaches" in front of her property, foreclosing her access to the harbor. She brought a complaint and petition for writ of mandate against her neighbor and the City, asserting claims for inverse condemnation, declaratory relief, and violations of due process, the Ralph M. Brown Act (Brown Act) (Gov. Code, § 54950 et seq.), the City Charter, and City Council Resolution No. 2012-97 regarding commercial tidelands leases. The trial court granted the City's motion for summary adjudication (MSA) on her inverse condemnation claim, and following a bench trial, it entered judgment for defendants on the remaining claims. For the reasons discussed below, we affirm.

FACTS

Plaintiff Susan [Bidart] Riddle, as trustee of the Leonard A. Bidart Family Trust under Trust Agreement Dated August 15, 2001, has owned the real property located at 510 and 510½ South Bay Front on Balboa Island in the City of Newport Beach since 1993. Defendant John Vallely and his wife, Karen Vallely, as co-trustees of the John Stephen Vallely Trust, own the neighboring real property located at 508 South Bay Front. The Vallely family has owned and lived in that property for over 80 years.

Both properties overlook the water, but they are separated from Newport Bay by an eight-foot-wide City-owned public walkway. The City holds title to the tidelands in Newport Bay in trust from the State of California.

Vallely and his wife operate a commercial business, Vallely Boat Rentals (a sole proprietorship), in those tidelands. The pier, dock, and floats have existed in their current configuration since the late 1930s, when Vallely's father added the dock and

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floats under permits issued by the City and the Army Corps of Engineers. Vallely has managed his family's business since 1976.

Although the Vallely pier was already there when Riddle purchased her property in 1993, Riddle now objects to the pier's existence because it "encroaches" in front of her property, blocks her access to the harbor, and prevents her from applying for a permit to build her own pier.

After Vallely's mother died in 2012, Vallely applied to have the permit for the pier, which the City had issued to his parents' family trust, transferred to his own family trust. The City denied his transfer application because at the time, the Newport Beach Municipal Code (NBMC¹) required a new pier permit application under the circumstances. (See NBMC § 17.35.020(F) ["In areas where existing piers and floats encroach in front of abutting upland property owned by others, a new permit approved by the Harbor Commission shall be required upon: [¶] . . . [¶] (3) Any change of existing ownership of the abutting upland property owned by the permittee or upon the death of the permittee . . ."].)

Vallely filed a petition for writ of mandate to require the City to transfer his parents' permit to him. The trial court denied his petition, noting the relevant provisions of the NBMC were "confusing" and "riddled with uncertainty." Vallely appealed.

While his appeal was pending, in December 2013, the City adopted Ordinance No. 2013-27, which amended NBMC Chapter 17.60 and subsection 17.35.030(B)(2) regarding leases and permits for piers in the tidelands. Among other things, the ordinance amended NBMC section 17.60.060(E) to "allow a person to apply for a commercial pier permit or lease in front of or encroaching upon

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abutting upland property not owned or leased by the person applying for the permit." (Italics added.) The amended code section also exempted commercial pier leases and permits "from any provision requiring involvement of the owner or long-term lessee of an abutting upland property."

After these legislative changes took effect, Vallely learned he could operate his commercial pier business under a tidelands lease and thus did not need to pursue a permit transfer via his pending appeal. Vallely's litigation counsel and the assistant city attorney negotiated a lease in which Vallely Boat Rentals leased the tidelands in front of the Vallely and Riddle properties from the City for a 50-year period. Subject to revisions which we discuss below, the lease resembled the model commercial tidelands lease template that the City Council had approved and adopted in late 2012 in Resolution No. 2012-97. The City Manager signed the Vallely lease on behalf of the City, and Vallely signed on behalf of Vallely Boat Rentals. The lease was issued without a public hearing or any formal notice to Riddle.

One day after the lease's effective date, Vallely dismissed his appeal in the permit transfer litigation. The City Manager and the assistant city attorney concede the lease was designed to resolve the litigation and moot Vallely's appeal. There is no evidence the City Council approved any sort of formal settlement with Vallely.

Riddle takes issue with both the Vallely lease and the way it was issued. She contends the lease damages her littoral rights in the tidelands, including her right to access the harbor and her right to build her own pier. She contends the City Manager lacked the authority to issue the Vallely lease, and she asserts the lease does not comply with local law regarding commercial tidelands leases. Riddle further complains the City Council secretly settled Vallely's pier permit transfer litigation by issuing the lease, without giving her notice of the lease or an opportunity to be heard, and without following the requirements of the Brown Act.

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Riddle sued the City and Vallely (collectively, Defendants) to invalidate the lease. In her operative Third Amended Verified Petition for Writ of Mandate and Complaint, Riddle asserted five claims: (1) declaratory relief that the lease is invalid; (2) petition for a writ of mandate invalidating the lease as a violation of the City Charter and Resolution No. 2012-97 concerning commercial tidelands leases; (3) petition for a writ of mandate invalidating the lease as a violation of Riddle's due process rights; (4) violation of the Brown Act (against the City only); and (5) inverse condemnation (against the City only).

The City filed an MSA on Riddle's inverse condemnation claim, asserting Riddle has no property right in the leased tidelands and thus cannot show a taking occurred. The trial court agreed and granted summary adjudication for the City.²

Trial then commenced on the remaining four causes of action. After trial, the trial court issued a detailed 14-page statement of decision ruling in Defendants' favor, and it entered judgment for Defendants on all five causes of action. Riddle appealed.

DISCUSSION

1. Inverse Condemnation

Riddle first contends the trial court erred in granting summary adjudication for the City on her inverse condemnation claim. According to Riddle, a triable issue of fact exists as to whether the Vallely lease harmed her littoral property rights. We review the grant of summary adjudication de novo, applying the same standards we apply in reviewing an order granting a motion for summary judgment, and considering all the evidence set forth in the moving and opposition papers, except that to which objections have been made and sustained. (Smith v. Wells Fargo Bank, N.A. (2005) 135 Cal.App.4th 1463, 1471-1472.)

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To bring a successful inverse condemnation claim, a plaintiff "must prove that a public entity has taken or damaged [her] property for a public use." (Pacific Bell v. City of San Diego (2000) 81 Cal.App.4th 596, 602.) That is, she "'must show there was an invasion or appropriation (a "taking" or "damaging") of some valuable property right which the property owner possesses by a public entity and the invasion or appropriation directly and specially affected the property owner to [her] injury.'" (City of Los Angeles v. Superior Court (2011) 194 Cal.App.4th 210, 221.)

Riddle contends the City damaged her property rights by allowing the pier on Vallely's leased premises to "encroach" in front of her property and foreclose her access to the harbor. The City holds title to the tidelands where the offending pier and floats are located, but Riddle insists she owns the "full complement of littoral property rights" in those tidelands, including the right to build a pier out to the line of navigability and the right of access from every part of her frontage across the foreshore. According to Riddle, these rights were harmed by the issuance of the Vallely lease. We cannot agree.

Littoral rights are water rights enjoyed by landowners whose property "border[s]," is "adjacent to," or "abut[s]" a natural lake, pond, sea, or ocean. (See State of Cal. ex rel. State Lands Com. v. Superior Court (1995) 11 Cal.4th 50, 63, fn.1; Kendall v. Walker (2009) 181 Cal.App.4th 584, 593; ...