In Lafayette Bollinger Development LLC v. Town of Moraga (2023) 93 Cal.App.5th 752, the First District Court of Appeal upheld the Town of Moraga’s denial of a development application based on unrelated inconsistencies with the general plan, despite the fact that Moraga’s land use element included a land use designation for the project site that was out of compliance with the law.
Background
The Town of Moraga denied Lafayette Bollinger Development LLC’s and Joan and David Bruzzone’s application to develop housing on the developers’ property and certify the EIR for the project because the project was not consistent with portions of the general plan related to public safety, residential density, grading volumes, location of other proposed development relative to the site, and impacts to natural resources. Moraga also denied the developers’ request for a general plan amendment and to change the zoning of the subject property from a “Study” designation to “residential.” The “Study” designation was originally intended to be temporary, but remained in place for approximately two decades and only allowed agricultural and accessory building uses. The developers sued Moraga, challenging its denial of the development application and general plan and zoning changes. The trial court issued a peremptory writ of mandate in favor of the developers, directing Moraga to issue a legally compliant land use designation, but rejecting the developers’ other claims regarding the denial of the development application, including takings, equal protection, and due process violations. The developers appealed.
Court of Appeal’s Opinion
While the Court of Appeal agreed that the “Study” designation violates Government Code section 65302, subdivision (a), it rejected the developers’ argument that the improper land use designation rendered Moraga’s entire land use element unlawful, and that Moraga was therefore unauthorized to reject its development application. The court concluded that a lack of a legally compliant land use designation alone does not preclude a local agency from denying a project application for unrelated reasons.
Procedural Issues
The court rejected Moraga’s argument that the developers’ challenge of the illegal land use designation is time barred because the court agreed that Moraga forfeited this argument by failing to raise it before the trial court.
The court also rejected Moraga’s argument that the developers failed to exhaust their administrative remedies by not requesting that Moraga adopt a land use designation independent of the development application. The court determined that the developers had repeatedly challenged the designation during the administrative proceedings—including specifically arguing that the designation prevented them from developing the property, that there was no legal precedent for leaving the designation in place for an extended duration, and that Moraga had an obligation to change it. Therefore, the court concluded, Moraga had sufficient notice of these claims.
Unlawful “Study” Land Use Designation
The parties did not contest that the “Study” land use designation violates section 65302, subdivision (a) because, as the court explained, the designation fails to describe a use of land and there is no dispute that the designation was a placeholder until Moraga could determine the appropriate permanent category. The court agreed with the trial court that Moraga had a mandatory duty to adopt a legally compliant land use designation for the property and that the trial court properly issued a writ directing Moraga to fulfill its duty.
The court further held, however, that this deficiency in the general plan did not void Moraga’s denial of the project application. The court explained that the developers failed to identify any law that prohibited Moraga from denying the project application simply because the general plan’s land use element did not comply with section 65302, subdivision (a). Here, the reasons given for the denial of the application involved public safety concerns and environmental impacts, and had nothing to do with the improper designation. If the developers were to prevail on their argument, the court reasoned, any deficiency in the general plan would preclude a local government from making any land use decision until the deficiency was corrected. Therefore, the developers failed to demonstrate a prejudicial abuse of discretion in the denial of their project application.
Takings
The court upheld the trial court’s determination that the developers’ takings claim was ripe as to the denial of the development project application and the land use designation, but not smaller potential projects, because neither Moraga or the developers explained why the trial court’s holding was unsound. Therefore, both parties forfeited their ripeness arguments.
The court rejected the developers’ takings claim on the merits. The court held that the illegal land use designation did not prevent the developers from seeking to develop the property, as the project application was not denied because of the land use designation and Moraga’s denial of the project did not deprive developers of all economically beneficial use of the property. The developers failed to argue otherwise on appeal, or show that smaller projects would not be economically beneficial or that they had no other reasonable use of the property. Moreover, the court also reiterated the trial court’s finding that the developers did not have a reasonable expectation of building the number of homes for which it claimed it had an “investment-backed” expectation because the character of the land might have limited the number of residences that could be built.
Equal Protection & Substantive Due Process
The court rejected the developers’ claim that Moraga’s actions denied them equal protection. The court determined that although Moraga’s actions resulted in an unreasonably long delay in adopting a permanent land use designation to comply with Government Code section 65302, Moraga had a rational basis in the delay to gather more information about the property due to the property’s unique aspects, including significant slopes and grading. Moreover, the court reiterated that the unlawful land use designation did not make it impossible for developers to develop the property or prevent them from submitting a project application, as they were able to propose a permanent designation in conjunction with the project application. Lastly, the developers failed to explain why Moraga’s denial of the project application had no rational basis beyond those involving the land use designation.
The court also rejected the developers’ substantive due process claims based on Moraga’s failure to issue a permanent and lawful land use designation for similar reasons. The court reiterated that there were rational reasons to retain the “Study” land use designation, and that it did not prevent other development or substantially hinder use of the property.