In a short opinion filed May 17, 2017, and belatedly ordered published (for unknown reasons) just six days later, the Fourth District Court of Appeal reversed the trial court’s judgment granting a writ of mandate that set aside the City of San Diego’s denial (on administrative appeal) of a small residential subdivision project in its low density La Playa neighborhood. Kutzke v. City of San Diego (4th Dist., Div. 1, 2017) 11 Cal.App.5th 1034. The Court of Appeal applied well established law in holding that if any substantial evidence in the record supports a City’s finding which requires denial of a subdivision, or that a related mitigated Negative Declaration (MND) is inadequate under CEQA, the City’s decision denying the Project must be upheld. Simply put, Courts may not substitute their judgment for a City’s on such matters or weigh competing substantial evidence, but instead must defer to and uphold the City’s decision unless no reasonable person could have reached the same conclusion.

The Infill Subdivision Project, The City’s Administrative Proceedings, And The Trial Court’s Decision

The project’s owners/applicants (Kutzke) sought to subdivide two adjacent lots totaling 1.45　acres into four lots, retaining an existing residence of local historic significance on one lot, and building a new residence on each of the other three lots.

In a “ping-pong”-like local process, the local community planning board recommended disapproval of the project as inconsistent with the Community Plan; the planning commission nonetheless approved the project and a related MND; the City Council then overturned that approval on a citizen’s appeal, finding the MND inadequate as to geology, land use, and public safety impacts, and that subdivision approval was inappropriate due to the project’s deviations from the community plan and applicable development regulations; and following that, the trial court granted a writ of mandamus on Kutzke’s petition overturning the council’s findings as unsupported by the evidence. The City then appealed that judgment.

The Court of Appeal’s Decision And Analysis

The Court of Appeal reversed the trial court’s judgment, thus reinstating the City Council’s denial of the subdivision project. It applied the deferential “substantial evidence” standard as required by Code of Civil Procedure §　1094.5, determining whether substantial evidence supported the Council’s findings and whether those findings supported its decision. In doing so, the Court considered the whole administrative record and all relevant evidence in it, conducting only a “limited weighing” of competing evidence to determine its worth as “substantial evidence”; it distinguished such review from an independent review whereby it could substitute its own judgment as to the preponderance of the evidence, noting that under its limited review it could reverse the Council’s “decision only if, based on the evidence before it, a reasonable person could not have reached the conclusion reached by it.”

To approve the minor subdivision project, the City was required to find that it was (1) consistent with the Peninsula Community Plan; (2) not detrimental to public health, safety, and welfare; and (3) complied with applicable land use regulations, unless it found any proposed deviation was appropriate for the project’s location and would result in a more desirable project than one designed in strict conformity. The City Council denied approval because it could not make these findings; it found the opposite as to each of them. It also found the MND inadequate with respect to the project’s impacts on geology, land use and public services.

The Court of Appeal observed under established law that if any one of the Council’s findings supporting denial was itself supported by substantial evidence it would have to uphold the Council’s project denial. (Citing Levi Family Partnership, L.P. v. City of Los Angeles (2015) 241 Cal.App.4th 123, 130; Breneric Associates v. City of Del Mar (1998) 69 Cal.App.4th 166, 176; Saad v. City of Berkeley (1994) 24 Cal.App.4th 1206, 1213-1214.)

Applying this rule and the applicable standard of review, the Court of Appeal had no trouble finding that all of the City Council’s findings in support of denial were supported by substantial evidence. Neighbors’ opinions and objections and expert renderings and photographs illustrated the contrast between the project’s minimal and substandard setbacks and the “more generously spaced residences with large setbacks” that characterized the surrounding neighborhood. This evidence supported the City’s findings of inconsistency with Community Plan goals of conserving single-family neighborhood character and encouraging compatibility of infill with existing residential development. It also supported the City’s findings that the project was not appropriate for its location, that its deviations from regulations did not make it more desirable, and that its MND failed to adequately address land use impacts.

Expert record evidence that exposed flaws in the project’s geotechnical report, and other expert evidence showing that the proposed residences’ configuration and the steepness of their shared driveway (which would not permit emergency fire truck access), supported the City’s findings that the project would be detrimental to public health, safety and welfare, that its location was inappropriate, and that it was not more desirable than a conforming project.

Conclusion

Kutzke’s argument that the evidence favoring project denial was less persuasive than that favoring approval was simply beside the point under the applicable standard of review, and particularly given the subjective nature of many of the required findings under the governing Community Plan and local regulations.

As observed by the Court: “Since the owners have not established no reasonable municipality could have reached the same decision as the City, we must uphold the City’s decision. “[I]t is ‘not the role of the courts to micro-manage these development decisions. Our function is simply to decide whether the City officials considered the applicable policies and the extent to which the proposed project conforms with those policies, whether the city officials made appropriate findings on this issue, and whether those findings are supported by substantial evidence.’” (Toigo v. Town of Ross (1998) 70 Cal.App.4th 309, 317.)”

While the CEQA issues and nature of the expert evidence in the record are not really fleshed out in this short opinion, and an MND can obviously easily be defeated by appropriate expert evidence of environmental impacts, this is one of those cases where the trial court would probably have been required to uphold the City’s decision on the land use consistency issues whichever way it went. While somewhat interesting due to its “see-saw” procedural chronology of conflicting decisions on the project at issue, that aspect of the case simply underscores that a number of vague and subjective policies and standards ultimately governed approval of this project. This vested the City’s final decision-making body with extremely broad discretion to approve or deny this subdivision project, which concededly failed to conform to all objective land use regulations for the area.

Since the Fourth District’s decision applies established law and does not break new legal ground or make a substantial contribution to the legal literature, it will undoubtedly leave experienced land use and CEQA practitioners wondering why the initial decision not to publish it was changed.

Questions? Please contact Arthur F. Coon of Miller Starr Regalia. Miller Starr Regalia has had a well-established reputation as a leading real estate law firm for more than fifty years. For nearly all that time, the firm also has written Miller & Starr, California Real Estate 4th, a 12-volume treatise on California real estate law. “The Book” is the most widely used and judicially recognized real estate treatise in California and is cited by practicing attorneys and courts throughout the state. The firm has expertise in all real property matters, including full-service litigation and dispute resolution services, transactions, acquisitions, dispositions, leasing, financing, common interest development, construction, management, eminent domain and inverse condemnation, title insurance, environmental law and land use. For more information, visit www.msrlegal.com.