Security Nat. Guar. v. Cal. Coastal Com'n

• Decision Date: 25 January 2008
• Docket Number: No. A114647.,A114647.
• Citation: 159 Cal.App.4th 402,71 Cal.Rptr.3d 522
• Court: California Court of Appeals Court of Appeals
• Parties: SECURITY NATIONAL GUARANTY, INC., Plaintiff and Appellant, v. CALIFORNIA COASTAL COMMISSION et al., Defendants and Respondents; SIERRA CLUB, Intervenor and Respondent.

71 Cal.Rptr.3d 522

159 Cal.App.4th 402

SECURITY NATIONAL GUARANTY, INC., Plaintiff and Appellant, v. CALIFORNIA COASTAL COMMISSION et al., Defendants and Respondents SIERRA CLUB, Intervenor and Respondent.

No. A114647.

Court of Appeal, First District, Division 5.

January 25, 2008.

Certified for Partial Publication.^*

Thomas D. Roth, San Francisco, Collins Law Firm, Craig M. Collins, Santa Monica, for Plaintiff and Appellant.

Edmund G. Brown, Jr., Attorney General, J. Matthew Rodriquez, Senior Assistant Attorney General, Daniel L. Siegel, Supervising Deputy Attorney General, Peter Southworth, Deputy Attorney General, for Defendant and Respondent.

California Environmental Law Project, Laurens H. Silver, Mill Valley, for Intervener and Respondent.

NEEDHAM, J.

The principal question that we must resolve in this appeal is whether the California Coastal Act of 1976, Public Resources Code section 30000 et seq. (the Coastal Act)¹ empowers the California Coastal Commission (the Commission) to declare that property is an "environmentally sensitive habitat area" (ESHA) (§ 30240) during an administrative appeal from a local government's grant of a coastal development permit (CDP). Appellant Security National Guaranty, Inc. (SNG) challenges three orders of the superior court: the denial of SNG's petition for writ of administrative mandamus, the denial of SNG's motion to remand the matter to the Commission for further proceedings, and the grant of summary adjudication to the Commission.

We conclude that the Coastal Act grants the Commission no power to declare property an ESHA during a CDP appeal. Accordingly, we reverse the superior court's denial of SNG's petition for administrative mandamus. We affirm the superior court's grant of summary adjudication.

FACTUAL AND PROCEDURAL BACKGROUND

The SNG Site

Appellant SNG owns, and seeks to develop, a 39-acre oceanfront site located west of state Highway 1 on Monterey Bay in Sand City. From 1927 to about 1986, the Lonestar Company conducted one of the largest commercial sand-mining operations in the western United States on the land now owned by SNG. Lonestar excavated and sold sand for industrial, commercial, and consumer uses. The sand mining operations left the site in an environmentally degraded condition, with an excavation pit near the middle of the property.

For many years after its incorporation in 1960, Sand City was the site of a number of businesses engaged in heavy commercial and industrial activities. Beginning in the 1970's, however, many of these businesses closed. Recognizing the city's need for economic recovery and development, Sand City sought to provide for commercially viable resort and recreational development on designated portions of its coastline.

Sand City's Local Coastal Program

In the early 1980's, Sand City formulated its local coastal program (LCP).² The LUP adopted by Sand City designated what is now SNG's site for visitor serving commercial uses. The original LUP also identified and mapped locations that were ESHA's. Section 4.2.4 of the LUP noted the existence of dune areas along the coast, explaining that the dunes were divided into two distinct locations—one east of Highway 1 and one west of Highway 1. As to the area west of the highway (and closest to the ocean), the LUP stated that "[t]he area provides no natural habitats" and that no ESHA's existed west of Highway 1. The only ESHA's identified and mapped in the LUP were located east of Highway 1. No ESHA's were mapped on what is now SNG's site, which is located entirely west of the highway. The LUP designated the property at issue in this appeal for visitor-serving commercial uses, with a density not to exceed 650 units.

The Commission concluded that Sand City's LCP met the requirements of the Coastal Act and certified the LCP as consistent with the Coastal Act's goals and policies. During the certification process, the Commission proposed, and Sand City adopted, a number of modifications to the city's LCP. After these modifications, the Commission granted the Sand City LCP final certification on March 14, 1986.

In 1990, the Commission conducted a "periodic review" of Sand City's LCP pursuant to section 30519.5. The periodic review resulted in the Commission making 59 recommendations to Sand City, including both LCP amendments and other actions. The record discloses no suggestion from the Commission that the property at issue in this appeal be designated an ESHA.

The Memorandum of. Understanding

Beginning in the late 1980's, the Monterey Peninsula Regional Park District (the Park District) attempted to amend Sand City's LCP to make parks and open space the preferred use on all lands west of Highway 1. In addition, the Park District and the State Department of Parks and Recreation (the Parks Department) sought to acquire coastal land within Sand City for park purposes. Sand City vigorously resisted the Park District's efforts, because it wished to preserve certain coastal parcels for development to ensure a stable fiscal future for the city. Sand City eventually sued the Park District to challenge, among other things, the Park District's land acquisition program in the city.

The controversy between Sand City and the park agencies continued for years. In 1995, then-State Senate Majority Leader Henry Mello intervened to mediate the coastal development dispute. Senator Mello arranged a meeting between the representatives of Sand City, the Park District, the Parks Department, and the Commission. As a result of this initial meeting, the interested parties formed a "discussion group" in an effort to resolve the conflict. After further meetings of this discussion group, the interested parties agreed to settle their differences by executing a "memorandum of understanding" (MOU).

On April 8, 1996, representatives of Sand City, the Sand City Redevelopment Agency, the Park District, and the Parks Department signed the MOU. The Commission was not a party to the agreement. Among other things, the MOU recognized the need for both "appropriate development" within Sand City and for the protection of coastal views, dunes, and public access to the beach. In particular, one of the MOU's stated objectives was to "[e]nable appropriate public and private development ... to occur along the Sand City Coastline; including but not limited to visitor serving and residential uses." The MOU also recognized that the site formerly used by the Lonestar Company was subject to an option to purchase by a "private development company." That company was SNG.

With regard to the former Lonestar site, the MOU provided that during "the active period of the option ... or in the event the option is exercised, [the Parks Department], the [Park District], and [Sand City] agree to recognize and respect the option agreement and the option holder's right to pursue development of the Lonestar Site consistent with the Sand City LCP." During that same period, the Park District and the Parks Department agreed to cease their efforts to acquire the former Lonestar site. The Park District further agreed that it would revise its application to amend the Sand City LCP to exclude the Lonestar site from the amendment. Thus, the MOU contemplated that the bulk of Sand City's coastline west of Highway 1 would be set aside for park uses, but that in two specific areas, including the Lonestar site (now SNG's property), commercial and residential uses would be permitted.

Finally, the MOU provided that Sand City and the Sand City Redevelopment Agency would dismiss their action against the Park District. Assured by the MOU that some commercial and residential development would be permitted along the coast, Sand City and its redevelopment agency acquiesced to further acquisition of coastal properties by the park agencies for park and open space purposes.

Amendments to the Sand City LCP

Prior to execution of the MOU, the Commission's staff had offered to assist Sand City and the park agencies "in developing the [LCP] amendments which are necessary to carry out the proposed MOU." To implement the MOU, the Park District and the Commission agreed upon changes to proposed LCP amendment No. 1-93. Rather than zoning all coastal properties within the City for preferred public park uses, the revised amendment No. 1-93 excluded what is now SNG's site from the park designation, thus permitting it to be developed. On April 10,1996, the Commission unanimously approved amendment No. 1-93. The amendment became effective immediately upon the Commission's approval.

SNG exercised its option to purchase the former Lonestar site in mid-1996, and closed on the Property in early 1997. At SNG's request, on April 16, 1997, Sand City approved another amendment to its LCP to allow the land use designations on the SNG site to be mixed, rather than segregated, while maintaining the uses and densities permitted by the LCP. The Commission staff recommended that the amendment be approved with certain suggested modifications. Although the staffs analysis of the amendment discussed ESHA issues, it did not state or even suggest that SNG's site might be an ESHA. In fact, the Commission's staff found that the proposed amendment "do[es] not raise an issue of conformance with Coastal Act habitat protection policies." The Commission then approved this amendment (No. 2-97) on June 11, 1997.

SNG's Project

SNG's proposed project is called Monterey Bay Shores Resort. As initially proposed the project contained 597 units, but SNG later reduced this number to 495. The project submitted was a mixed-use development that provided for timeshare units, a hotel, residential condominiums, and visitor serving residential units, as well as a conference center. The project also contained plans for habitat restoration and dune stabilization.

SNG then applied to Sand City for issuance of a coastal development permit (CDP) for the project. On December 1, 1998, Sand City's city council...