High Court Will Not Review Ruling on Proposition 13 Reassessments

Thursday, July 22, 2004

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High Court Will Not Review Ruling on Proposition 13 Reassessments

By KENNETH OFGANG, Staff Writer/Appellate Courts

The California Supreme Court yesterday declined to review a Fourth District Court of Appeal ruling upholding the manner in which county assessors have interpreted Proposition 13’s limit on assessment increases.

Only Justices Joyce L. Kennard and Kathryn M. Werdegar voted at yesterday’s conference to hear an appeal in County of Orange v. Bezaire, G032412.

An Orange Superior Court judge sent shockwaves throughout the state when he held that the assessed value of property that has not been improved or sold within the past year cannot exceed the previous year’s assessment by more than two percent.

Assessors across the state have uniformly applied the “recapture” method of assessment, in which the maximum assessment of such property is pegged at the purchase price of the property plus two percent per year from date of purchase, compounded annually.

In other words, the increase from one year to the next may exceed two percent if the assessment was reduced or left unchanged, or increased by less than two percent, in prior years.

Had it stood, Superior Court Judge John Watson’s ruling would have cost local governments an estimated $10 billion in refunds, plus substantial lost revenues in future years. But Court of Appeal Presiding Justice David Sills said Watson’s decision was “fundamentally inconsistent with the system that Proposition 13 put in place.”

Watson erred, Sills explained, in defining “full cash value base.” Proposition 13, as amended in November 1978 by Proposition 8, declares: “The full cash value base may reflect from year to year the inflationary rate not to exceed 2 percent for any given year or reduction as shown in the consumer price index or comparable data for the area under taxing jurisdiction, or may be reduced to reflect substantial damage, destruction or other factors causing a decline in value.”

The presiding justice reasoned that had the drafters intended to limit the allowable two percent increase to the “previous” assessed value, or to the “reassessed value of the year before,” they would have inserted those words in the text.

Amicus Briefs

The California Assessors’ Association, California School Boards Association, state Senate, California State Association of Counties, League of California Cities, and California Department of Finance filed amicus briefs in support of Orange County.

The recapture method was challenged by a Seal Beach couple, Renee M. Bezaire and Robert A. Pool. Pool is a partner in the Bellflower firm of Gangloff, Gangloff & Pool and argued in the Court of Appeal along with partner David Gangloff.

Bezaire and Pool purchased a $330,000 home in Seal Beach in November 1995, and the property was placed on the tax roll in 1996 at that sum. The property failed to gain value in 1997, the assessor determined, so it was placed on the roll at the same amount.

When property values rose in 1998, however, the assessor applied the recapture method and fixed the value at $343,332.

Appeals Board

An assessment appeals board agreed with the homeowners that the maximum reassessment should have been the previous year’s assessment plus two percent. It cut the assessment by $10,000, entitling the couple to a refund of a little over $100.

When the county challenged the board’s decision, Pool and Bezaire responded with a class-action cross-complaint seeking reassessments on behalf of all similarly situated homeowners.

In other action at yesterday’s conference, the justices:

•Unanimously agreed to decide whether “sexually coarse and vulgar language” in the workplace constitutes harassment based on sex within the meaning of the Fair Employment & Housing Act, and if so whether imposing liability for such harassment violates the constitutional right to free speech.

In Lyle v. Warner Brothers Television Productions, B160528, this district’s Div. Seven rejected the contention that “creative necessity” is a defense to an action against an entertainment producer based on the use of sexually explicit language in story meetings.

The nature of the entertainment product is relevant, however, to the issue of whether the defendants created a hostile work environment, Justice Earl Johnson Jr. wrote for the Court of Appeal.

Aamani Lyle, an African American, worked on NBC’s “Friends” for four months as a writer’s assistant. The producers say she was fired because she could not type fast enough and that dialogue developed during meetings was often missing as a result.

She claims she was constantly subjected to offensive and bigoted comments and jokes made by the writers and producers during meetings. She was offended, she said, by the constant references to the defendants’ own sexual experiences, the making of sexually explicit drawings in an erotic “coloring book” one of the defendants kept on his desk, and speculation about the sex lives of the actors on the show, she said.

The defendants argued that racially and sexually oriented comments or jokes were not severe or pervasive enough to create a hostile work environment and that such remarks were, in any event, an essential part of creating a program about sexually active young adults.

•Denied a request to depublish the Jan. 27 opinion of this district’s Div. One in Rezec v. Sony Pictures Entertainment, Inc., B160586. The divided panel held that a suit against Sony Pictures over the use of manufactured quotes from a nonexistent reviewer in ads for four films was not subject to a motion to strike under the anti-SLAPP statute.

Div. One said the film advertisements were commercial speech which did not qualify for protection under Code of Civil Procedure Sec. 425.16.

The statute makes suits subject to a special motion to strike if the cause of action arises out of acts “in furtherance of the...right of petition or free speech under the United States or California Constitution in connection with a public issue.”

Justice Robert Mallano, writing for himself and Presiding Justice Vaino Spencer, rejected Sony’s argument that the advertisements for the four films were entitled to First Amendment protections because the films being advertised were themselves an exercise of free speech.

•Unanimously agreed to decide whether police who entered a probationer’s residence without knocking and announcing themselves performed an unreasonable search and seizure, requiring that the woman’s conviction of possessing methamphetamine for sale be thrown out.

The justices had sent Mildred Murphy’s case back to the Fourth District’s Div. One after the U.S. Supreme Court last year upheld a search by officers who waited 15 to 20 seconds after announcing their presence before they forcibly entered a residence. The officers had reason to believe that the suspect, who said he was in the shower and didn’t hear the officers until they crashed through his door, would dispose of evidence if they waited longer, the high court said in United States v. Banks (2003) 124 S.Ct. 521.

Div. One, however, reversed Murphy’s conviction a second time. Justice Cynthia Aaron said the Banks scenario was different than Murphy’s case, in which the officers never knocked, announced their presence by yelling at a workman outside the house, and then waited only five to seven seconds before forcing their way in.