Viacom Outdoor, Inc. v. City of Arcata

44 Cal.Rptr.3d 300

140 Cal.App.4th 230

VIACOM OUTDOOR, INC., Plaintiff and Respondent, v. CITY OF ARCATA et al., Defendants and Appellants.

No. A110628.

Court of Appeal, First District, Division 2.

June 8, 2006.

Law Offices of Nancy Diamond, Nancy Diamond, San Rafael; Mitchell, Brisso, Delaney & Vrieze, William F. Mitchell and Nancy K. Delaney, Eureka, Attorneys for Defendants and Appellants.

Greines, Martin, Stein & Richland LLP, Timothy T. Coates, Los Angeles, for League of California Cities and California State Association of Counties, Attorney for Amici Curiae on behalf of Appellants.

Barnum & Herman, William F. Barnum, Eureka, Attorney for Plaintiff and Respondent.

BUSCH, J.^*

The trial court determined that state law preempted the efforts by the City of Arcata (City) to enforce its ordinances requiring permits before Viacom Outdoor, Inc. (Viacom) could rebuild a number of wind-destroyed billboards. Because it had no authority to insist on compliance with its ordinances, the City was also found to have violated Viacom's federal civil rights. Damages and attorney fees were awarded to Viacom under federal civil rights statutes.

The primary issue presented on this appeal by the City is whether California's Outdoor Advertising Act (Bus. & Prof. Code, § 5200 et seq. (the State Act)¹) preempts municipal ordinances that require a permit for rebuilding outdoor stand-alone billboards destroyed by natural forces. We conclude this well-established local power is not displaced by the State Act. We further conclude that because the municipal ordinances are valid and enforceable, their threatened enforcement has not yet been shown to have caused actionable damage. In light of these conclusions, we reverse.

BACKGROUND

The salient facts are easily recounted. Viacom owned four billboards located within the City and adjacent to State Highway 101. For each of the billboards Viacom had a current "outdoor advertising permit" issued by the California Department of Transportation (CalTrans). The billboards were made of wood. Three were put up in 1954, the fourth in 1962. The billboards were destroyed by windstorms in November-December of 2001. Viacom began rebuilding the billboards. A city official posted "stop work" orders on the billboards, thus directing Viacom to cease rebuilding until it applied for permits as required by the City's Building Code and its Sign Code.² Although Viacom stopped rebuilding, in subsequent correspondence with the City it insisted it was not obliged to obtain permits prior to rebuilding its billboards.

Viacom did not apply for permits, but it did commence this action against the City and the members of the city council. Viacom alleged three causes of action in its complaint. The first was a petition for a writ of mandate on the ground that the State Act (and regulations promulgated pursuant thereto) constituted the sole applicable law, meaning the City had no "regulatory authority" to require permits for reconstructing billboards. Specifically, the State Act withdrew municipal power over "customary maintenance" of any billboard for which CalTrans had issued a permit (citing § 5225 & Cal.Code Regs., tit. 4, § 2271). The second cause of action sought declaratory relief to the effect that "The legislature enacted the Outdoor Advertising Act with the express intention to preempt the entire field of regulation of billboards in California, allowing cities only the power to regulate the locations and placements of new billboard structures. All other acts of municipalities are defined as ultra vires acts for which compensation must be paid to CalTrans billboard permit holders. The City of Arcata has no power . . . to require the application for, or issuance of, city building permits . . . ."

Viacom's third and final cause of action invoked the federal Civil Rights Act of 1871 (42 U.S.C. § 1983). Viacom alleged the City's actions "unfairly singles out [Viacom] to bear the burden of government action in violation of the Equal Protection Clause as set forth in Article I, Section 7(a) of the California Constitution and the Fourteenth Amendment of the United States Constitution," and also infringed Viacom's "procedural and substantive due process rights and denie[d] just compensation for governmental taking of private property, all in violation of Article I, Section 7(a) of the California Constitution and the Fifth and Fourteenth Amendments of the United States Constitution." Viacom prayed for monetary damages and an injunction preventing the City from attempting to enforce "any municipal . . . permit conditions or requirements."

The case was tried in two stages. In the first, the court granted Viacom's petition for a writ of mandate upon concluding that "California Code of Regulations, section 2271, preempts the field. It sets forth the criteria by which billboards may be re-erected. If those criteria are met, no further action by a local public entity is necessary. The California Department of Transportation is the sole governing agency under such circumstances. [¶] The City of Arcata is enjoined from interfering with the re-erection of the billboards."

There followed a bench trial on the issue of damages. The court concluded that the City's "unlawful interference with [Viacom's] right under the Outdoor Advertising Act to reconstruct billboards blown down in a storm" constituted a violation of Viacom's "civil right to enter into and maintain contracts. Here, because [Viacom] could not reconstruct the billboards without the threat of action by the City of Arcata, [Viacom] could not perform its contracts with its vendees by supplying the advertising required by those contracts. The City of Arcata, then, intentionally interfered with [Viacom's] contractual relations, a property right guaranteed by the state and federal constitutions." The court fixed Viacom's "damages for lost rent in the sum of $37,483.94." The court further found that Viacom was entitled to attorney fees under 42 U.S.C. § 1988. The court thereafter entered judgment awarding Viacom damages of almost $39,000, attorney fees of $39,104, and an injunction prohibiting the City "from interfering with [Viacom's] re-erection of the wind blown billboards." The City then perfected this timely appeal.

DISCUSSION

Since 1999 the City's sign code has provided that "A sign shall not hereafter be erected, re-erected, constructed, altered or maintained except as provided by this code and after a permit has been issued . . . ." and making it "unlawful for a person, firm or corporation to erect, construct, enlarge, alter, repair, move, improve, remove, convert or demolish, equip, use, or maintain a sign or sign structure in this jurisdiction . . . contrary to or in violation of the provisions of this code." (Arcata Sign Code, §§ 301, 103.4). It was the attempted exercise of this ordinance that the trial court found was preempted by the State Act.

"The general principles governing preemption analysis are these. [¶] Under article XI, section 7 of the California Constitution, `[a] county or city may make and enforce within its limits all local, police, sanitary, and other ordinances and regulations not in conflict with general laws.'

"`If otherwise valid local legislation conflicts with state law, it is preempted by such law and is void.' [Citations.] [¶] `A conflict exists if the local legislation "`duplicates, contradicts, or enters an area fully occupied by general law, either expressly or by legislative implication.'"' [Citations.]

"Local legislation is `duplicative' of general law when it is coextensive therewith. [Citation.] [¶] Similarly, local legislation is `contradictory' to general law when it is inimical thereto. [Citation.]

"Finally, local legislation enters an area that is `fully occupied' by general law when the Legislature has expressly manifested its intent to `fully occupy' the area [citation], or when it has impliedly done so in light of one of the following indicia of intent: `(1) the subject matter has been so fully and completely covered by general law as to clearly indicate that is has become exclusively a matter of state concern; (2) the subject matter has been partially covered by general law couched in such terms as to indicate clearly that a paramount state concern will not tolerate further or additional local action; or (3) the subject matter has been partially covered by general law, and the subject is of such a nature that the adverse effect of a local ordinance on the transient citizens of the state outweighs the possible benefit to the' locality.

[Citations.]" (Sherwin-Williams Co. v. City of Los Angeles (1993) 4 Cal.4th 893, 897-898, 16 Cal.Rptr.2d 215, 844 P.2d 534, fn. omitted (Sherwin-Williams); accord, Great Western Shows, Inc. v. County of Los Angeles (2002) 27 Cal.4th 853, 860-861, 118 Cal.Rptr.2d 746, 44 P.3d 120; People ex rel. Deukmejian v. County of Mendocino (1984) 36 Cal.3d 476, 484-485, 204 Cal.Rptr. 897, 683 P.2d 1150.)

Billboards have long been recognized as a proper subject for local regulation under the police power. (St. Louis Poster Adv. Co. v. St. Louis (1919) 249 U.S. 269, 274-275, 39 S.Ct. 274, 63 L.Ed. 599; Thomas Cusack Co. v. City of Chicago (1917) 242 U.S. 526, 529, 37 S.Ct. 190, 61 L.Ed. 472; United Advertising Corp. v. Borough of Raritan (1952) 11 N.J. 144, 93 A.2d 362, 365-366 and authorities cited; 7 McQuillen, The Law of Municipal Corporations (3d ed.2005 rev. vol.) § 24:379 et seq.; Annot., Power of Municipality as to Billboards and Outdoor Advertising (1931) 72 A.L.R. 465.) California counties and municipalities have not been hesitant to exercise their regulatory powers on this subject. (E.g., Tahoe Regional Planning Agency v. King (1991) 233 Cal.App.3d 1365, 1395, 285 Cal.Rptr. 335; Mountain View Chamber of Commerce v. City of Mountain View (1978) 77 Cal.App.3d 82, 93, 143 Cal.Rptr. 441; Burk v. Municipal Court (1964) 229 Cal.App.2d 696, 701, 40 Cal.Rptr. 425; National...