Young's Mkt. Co. v. Superior Court of San Diego Cnty.

YOUNG'S MARKET COMPANY, Petitioner, v. THE SUPERIOR COURT OF SAN DIEGO COUNTY, Respondent,SAN DIEGO UNIFIED SCHOOL DISTRICT, Real Party in Interest.

D068213

COURT OF APPEAL, FOURTH APPELLATE DISTRICT DIVISION ONE STATE OF CALIFORNIA

January 11, 2017

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

(San Diego County Super. Ct. No. 37-2015-00007265-CU-PT-CTL)

Petition for writ of mandate from an order of the Superior Court of San Diego County, Lisa C. Schall, Judge. Petition denied, stay vacated.

Allen Matkins Leck Gamble Mallory & Natsis and Kenneth Erik Friess, Nicholas S. Shantar for Petitioner.

Stark & D'Ambrosio and James A. D'Ambrosio, George A. Rios, III for K1 Speed, Inc., as Amicus Curiae on behalf of Petitioner.

Dannis Woliver Kelley and Janet L. Mueller, Cameron C. Ward, Kirsten Y. Zittlau, Karina K. Samaniego, on behalf of Real Party in Interest.

This matter comes to us on remand from the California Supreme Court, with directions to vacate our earlier decision (Young's Market Co. v. Superior Court (2015) 242 Cal.App.4th 356, review granted Jan. 13, 2016, S230808) and reconsider the cause in light of its opinion in Property Reserve, Inc. v. Superior Court (2016) 1 Cal.5th 151 (Property Reserve). Having done so, we conclude the superior court did not err by issuing its order, and deny the writ petition.

FACTUAL AND PROCEDURAL BACKGROUND

Young's Market Company (Young's) owns approximately two acres of real property in downtown San Diego adjacent to an elementary school owned and operated by real party in interest San Diego Unified School District (District). The property contains an over 50,000 square foot industrial building, a parking lot and landscaping. Young's leases the property to K1 Speed, Inc. (K1), which operates an indoor kart racing center with arcade lounges, eating areas and retail merchandising. K1 operates seven days a week.

In March 2015, District petitioned for an order granting it a right of entry under the Eminent Domain Law (Code Civ. Proc., § 1245.010 et seq.¹), asserting it was interested in potentially acquiring the property to expand the elementary school andconstruct other school facilities. By its petition, District sought under sections 1245.010 and 1245.030 to conduct certain investigations and environmental testing on the property. It alleged it was authorized to acquire property by eminent domain for those purposes and required access to conduct mandated preliminary studies and assessments. District had sought to obtain consent, but Young's declined to provide access, telling District it was not interested in selling the property. District attached a survey prepared by an environmental assessment consultant detailing the scope of the proposed work, which included drilling bore holes to conduct groundwater and soil samples, then backfilling with sand or bentonite grout and resurfacing with concrete, as well as bulk sampling of building materials suspected to contain lead or asbestos.² District stated it expected thework would take eight to 10 business days to complete. It believed any compensation for the activities would be nominal and stated it was prepared to deposit the probable amount as determined by the court. District's proposed order stated in part that District "shall not access the [property] on more than ten (10) business days within a sixty (60) day period without the prior consent of this Court" and it would "deposit with this Court the total probable amount of just compensation of One Thousand Dollars ($1,000) or __________ ($__________)."

Young's opposed the petition. Characterizing District's actions as a sweeping and comprehensive drilling and sampling project, it argued the precondemnation entry and testing statutes only authorized innocuous or superficial entries on property, akin to preparing a survey or map, and not such an unrestricted property-wide occupation assertedly lasting from two weeks to 60 days or more. It asserted District's proposal went far beyond the precondemnation statutes, and was an unconstitutional taking under the United States and California Constitutions as reflected in Jacobsen v. Superior Court of Sonoma County (1923) 192 Cal. 319 (Jacobsen). Young's argued District's proposal to remove dirt and building materials effected an obvious permanent physical occupation or per se taking for which it was required to file a classic condemnation suit and pay just compensation as determined by a jury. Young's alternatively asked the court to stay the action to await the California Supreme Court's decision in Property Reserve, supra, 1Cal.5th 151, or, if it were inclined to grant the petition and allow District to proceed, order District to deposit a minimum of $500,000 toward compensation in lost rent, goodwill and property.

In reply, District argued Young's grossly mischaracterized the duration, nature and extent of the proposed work, which was not as extensive as that proposed by the public entity in Jacobsen, supra, 192 Cal. 319.³ It presented the declaration of Lisa Bestard, an environmental testing scientist with the consultant hired by District. Bestard explained that the purpose of the investigative activities was to obtain initial data to evaluate if impacted soil, groundwater and/or soil vapors were present at the property and if so, evaluate if contamination levels precluded it from being used as a future school site. She stated her company's proposal sought a maximum of eight to 10 business days, excluding weekends, to conduct the work, which could be done on consecutive days. Bestard described the drilling rig as a direct-push drill mounted in the bed of a utility truck that would fit within a regular-sized parking space; she explained this type of drill disrupts very little soil around the actual drill space, and approximately three people are involved in the drilling activities. Further, Bestard explained the monitoring wells referenced inthe project were temporary, as they would stay open for 24 hours at the most. As for the building material sampling, Bestard stated that under her company's proposal, "a small sample (less than the size of a postage stamp) will be removed from an area that is not visible. For example, we would take a small piece of the building material from underneath an electrical outlet (which we would first remove) or remove a small piece of material from behind a piece of equipment (namely, a refrigerator or snack machine)."

District argued its work did not constitute a taking, pointing out that borings and samplings were expressly authorized by section 1245.010 of the precondemnation entry and testing statutes, and it was statutorily mandated to perform such work before a proposed site could be approved as a school site. Finally, District argued the $500,000 in compensation proposed by Young's was speculative and exaggerated; there was no evidence K1 would suffer any business interruption or lost profits, or that Young's would lose rental income, and in the event of unforeseen damage the court could modify its order for a deposit.

The superior court granted the petition, ordering District could enter the property to conduct the investigations identified in its petition on condition that District in accordance with section 1245.030, subdivision (c) deposit with the court $5,000 as a probable amount of compensation and serve K1 with a copy of the order. Under the order, K1 was given 45 days after service to either reach an agreement with District or apply ex parte to enjoin District's investigations. If K1 did not do so or its ex parte application was denied, the court ordered District would then have the "immediate right" to conduct its investigations.

Young's petitioned for a writ of mandate and/or prohibition asking this court to direct the superior court to vacate its order granting the District's petition. It contended District's proposed activities went beyond the precondemnation entry and testing statutes, which to comply with the state and federal Constitutions permitted only innocuous and superficial inspections before condemnation. Young's argued District's actions constituted a permanent physical occupation of its property requiring that District file a classic condemnation action or proceeding to litigate the need for the taking and provide Young's with a jury determination of just compensation. It sought an immediate temporary stay pending resolution of its writ petition.

We stayed the superior court's order, and eventually denied the writ petition. We concluded District's proposed actions were temporary and limited intrusions on the property, and those actions neither violated the precondemnation entry and testing statutes nor constituted a per se taking requiring a jury determination of just compensation.

The California Supreme Court granted Young's petition for review. It deferred action pending its consideration and disposition of related issues in Property Reserve, supra, 1 Cal.5th 151, and thereafter transferred the matter back to us as stated above. Only District has filed a supplemental brief.

DISCUSSION

I. Property Reserve

In Property Reserve, the California Department of Water Resources (the Department) sought to investigate the feasibility of constructing a new tunnel or canal inthe Sacramento-San Joaquin Delta as part of a water delivery system. (Property Reserve, supra, 1 Cal.5th at pp. 165, 168, fn. 3.) As part of its investigation, the Department proposed to enter over 150 privately owned properties to conduct preliminary environmental and geological studies and testing. (Id. at p. 168.) Specifically, the Department sought to conduct environmental mapping and surveys relating to plant and...