Friday, October 4, 2013
Community College District Wins Fight Over Easement
C.A. Says Neighboring Building Owner Bound by Ruling Against Predecessor
By a MetNews Staff Writer
The owner of an historic building in downtown Los Angeles is bound by a ruling that blocked its predecessor from creating vehicular access for the building’s tenants through an alley shared by two other buildings, the Court of Appeal for this district has ruled.
Div. Four Wednesday, in an unpublished opinion by Justice Stephen Suzukawa, ordered entry of an injunction in favor of the Los Angeles Community College District, barring GS Roosevelt, LLC from using the 30-foot by 90-foot alley for access to the Roosevelt Building’s parking garage.
The building, which opened in the mid-1920s, shares the alley with the commercial 700 Wilshire Building and the 770 Wilshire Building that serves as headquarters for the college district. The college district owns the western half of the alley and 700 Wilshire Partners the eastern half; GS Roosevelt has no ownership interest in it, but all three entities have an easement appurtenant.
For several decades, the three buildings used the alley for commercial deliveries, trash pickup, and other uses typical of commercial buildings. But in 2007, the Roosevelt Building—which sits atop the 7th Street/Metro Center rail station—was converted to condominiums and its loading dock was replaced with an entrance and exit to its parking garage.
700 Wilshire Partners sued the then-owner of the Roosevelt Building, contending that private vehicular traffic was incompatible with the historic uses of the easement. The college district was named as an indispensable party in the action and filed a cross-complaint, asserting essentially the same position as 700 Wilshire.
The judge in that suit found that the easement would not be overburdened and granted judgment in favor of the Roosevelt Building’s then-ownership, which went bankrupt while the judgment was being appealed.
The bankruptcy court eventually allowed the debtor to sell the building, the easement, and its rights under the judgment to GS Roosevelt, an affiliate of Greystar Real Estate Partners, which has been active in the local loft-conversion market. With the condominium market in decline, Greystar turned the units into rental apartments, the smallest of which are about 800 square feet and rent from about $2,500.
Tenants were advised when renting the units that they might lose garage access through the alley as a result of the litigation, although two other access points are unaffected.
Before the appeal was argued, GS Roosevelt was substituted as a party and participated in oral argument. The Court of Appeal subsequently reversed the judgment, said the Roosevelt Building’s prior owners had overburdened the easement by unilaterally opening the alley to residential vehicular traffic, and sent the case back to the trial court for entry of an injunction and trial of the district’s cross-complaint for fraud, which had been dismissed by the trial judge.
GS Roosevelt filed a petition for rehearing in the Court of Appeal and a petition for review in the Supreme Court, both of which were rejected.
On remand, GS Roosevelt argued that it was not a party and that the trial court lacked personal jurisdiction over it. The court entered a preliminary injunction against the previous owners, not mentioning GS Roosevelt.
The owners of the other two buildings thereafter began blocking vehicles from using the alley to access the Roosevelt Building’s garage. GS Roosevelt claimed this violated its rights under the bankruptcy court’s confirmation plan and brought an emergency motion for relief in that court.
In August of last year, the bankruptcy judge entered an order that allowed the Roosevelt Building’s tenants to use the alley for access to the garage, except during hours that a school located in the 700 Wilshire Building was in session. The judge also held that the confirmation order had relieved GS Roosevelt of liability for the conduct of its predecessor, but not for its own conduct, and left it up to the state court to determine whether GS Roosevelt had independent liability and, if so, to grant appropriate relief.
Superior Court Judge Frederick Shaller, in October of last year, said GS Roosevelt had done nothing to incur independent liability and was not bound by the Court of Appeal ruling in the prior appeal. The bankruptcy judge subsequently lifted the prior restriction on the use of the alley, while declaring that the state courts were still free to determine the scope of the easement and the validity of any action taken by the debtor “to increase or affect the scope of the Easement.”
Suzukawa, writing for the Court of Appeal Wednesday, said Shaller erred because GS Roosevelt had, by its appearance and active participation in the prior appeal, agreed to be bound by the ruling in that case.
Citing Code of Civil Procedure Sec. 410.50(b), he explained:
“GSR never contested this court’s personal jurisdiction in the prior appeal. It was only after the matter was remanded to the superior court that GSR purported to make a special appearance. By then, however, it was too late for GSR to contest the superior court’s personal jurisdiction, for ‘[j]urisdiction of the court over the parties and the subject matter of an action continues throughout subsequent proceedings in the action.’…In other words, once personal jurisdiction is acquired, it continues throughout the remainder of the litigation.”
The Court of Appeal’s prior determination that use of the easement for private vehicular traffic would overburden the easement as a matter of law, he went on to say, is now the law of the case and binding on GS Roosevelt.
Attorneys on appeal were Haight Brown & Bonesteel’s Morton G. Rosen, and Jeffrey A. Vinnick for the college district and Vincent H. Herron, Susan P. Welch, and Gregory O. Lunt of Abelson Herron Halpern for GS Roosevelt.
The case is Los Angeles Community College District v. GS Roosevelt, LLC, B244809.
Copyright 2013, Metropolitan News Company