June 26, 2015

Can the Coastal Commission attach a dormant easement as a condition to a permit?

By Can the Coastal Commission attach a dormant easement as a condition to a permit?

Today, PLF filed an amicus brief in the California Court of Appeal defending the property rights of La Jolla coastal landowners Ure and Dianne Kretowicz. The Kretowiczs purchased their blufftop home from a bank after a foreclosure in 1994, unaware of any restrictions on the title. But when they tried to get a permit to build a swimming pool and make some minor improvements to their house, they unwittingly provoked a long battle with the California Coastal Commission. The Commission said that a public easement across the property had been dedicated across the property back in 1979. So, if the Kretowiczs wanted their permit, they would have to acknowledge the easement and allow the public to cross their property.

In 1979, the Commission had demanded from prior owners that they dedicate a public access easement in return for a building permit. But, by the time the Commission made that decision, the house had already been built in reliance on an earlier permit issued by a regional Coastal Commission. And the owners’ attorney told the Coastal Commission that if it wanted a public easement, it would have to use its eminent domain power. As a result, no dedication of a public easement was ever recorded. Nor did the Commission attempt to enforce the easement until the Kretowiczs applied for a permit nearly two decades later.

In our brief, we argue that the Commission cannot enforce the purported 1979 easement against the Kretowiczs. First, if the Commission had attempted to condition a new public access easement on the granting of the Kretowiczs permit, it would surely be unconstitutional. Under PLF’s case of Nollan v. California Coastal Commission, the government cannot exact a new public easement as a permit condition unless it bears an “essential nexus” to the effects of the planned project. Of course, the Kretowiczs’ swimming pool and improvements had no effect on public beach access, since public access through the property had been non-existent since at least 1979. So, if the Commission is to win, it must be because the 1979 easements are valid.

But the easement was never recorded. The recording acts provide stability and certainty both to property owners and those looking to purchase property. For purchasers, it is essential that any restrictions on title, like a public easement, be discoverable in the public record through a title search. If that were not true, no buyer could know for sure that a third party with a competing claim would not show up and challenge the title. That is why the California courts have recognized only narrow exceptions to the general rule that people may rely on record title. For example, if a purchaser buys property for a “grossly inadequate” price, or one that is currently occupied by a third party, a court may infer that the purchaser should have known the title was not perfect.

The narrow exceptions do not apply in this case. The Kretowiczs purchased the property for a significant sum and, because the public easement had never been enforced, there was no indication that public access was allowed. But the trial court still found that, because Mr. Kretowicz is a real estate developer, he should have known to go to the Commission’s office to check for any permit conditions that may have been imposed. There is no authority for such an expanded duty to investigate, and we hope the Court of Appeal will reject it. The Commission cannot use a dormant easement to opportunistically require the Kretowiczs to give up the right to exclude trespassers from their property.

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