Metropolitan News-Enterprise

 

Thursday, February 25, 2021

 

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Court of Appeal:

Allegations in Exhibit to Complaint Take Precedence Over Pleading’s Averments

 

By a MetNews Staff Writer

 

A demurrer was properly sustained to a complaint alleging a Brown Act violation by a city council in adopting an ordinance because the plaintiff, while averring that there was no detrimental reliance on the improperly noticed action so as to validate it, had attached to his complaint a letter from developers which stated to the contrary, the Court of Appeal for this district has declared.

That attachment, Tuesday’s unpublished opinion from Div. Six sets forth, prevails over the plaintiff’s allegation.

Justice Kenneth Yegan wrote the opinion, which reverses a judgment of dismissal by Santa Barbara Superior Court Judge Jed Beebe, in which Presiding Justice Arthur Gilbert and Justice Martin J. Tangeman concurred. Although signing Yegan’s opinion, Tangeman proceeded to express, in a “concurring” opinion, disagreement with the pronouncement regarding detrimental reliance.

His assault was on an alternative holding by Yegan.

Main Holding

The underlying facts were that the Lompoc City Council included notice on its agenda for a May 7, 2019 meeting that it would be considering adoption of an ordinance extending a development agreement, but failed to state separately, as required by the Brown Act, that this would entail a determination that no new environmental impact was needed. The main holding was that the omission was without significance because proper notice was subsequently provided and the ordinance was re-adopted on July 2, 2019.

Pointing out that implementation of the project continued after the May 7 approval, plaintiff Bradley Couey insisted that the ordinance, No. 1669(19), had to be scrapped based on the failure to include on the initial agenda all matters to be considered, and that the legislative process had to be started afresh. Yegan responded that “no published case has held that rescission of an entire ordinance is the only way to cure the agenda omission of a discrete item in an adopted ordinance.”

Tangeman said in his separate opinion:

“I agree with the majority’s conclusion that the Ralph M. Brown Act…violation which occurred here was cured by renoticing and then approving, after proper notice, the readoption of the ordinance. Accordingly, I concur in the result.”

Detrimental Reliance

Tangeman went on to express disagreement, however, with Yegan’s perception that Government Code §54960.1(d)(3) comes into play. That provision says that a Brown Act violation will not render a local legislative void where “a party has, in good faith and without notice of a challenge to the validity of the action, detrimentally relied.”

Yegan expressed this view:

“Here the project developers claim such reliance. On June 27, 2019, a week before Ordinance No. 1669(19) was readopted, the developers’ attorney sent a letter stating that the developers relied on the development agreement extension to hire consultants and had expended significant time, effort, and financial resources on the project. Although the complaint alleges, on information and belief, that no party detrimentally relied on Ordinance No. 1669(19), the developers’ letter is attached to the verified complaint as an exhibit and takes precedence on demurrer.”

Yegan cited two opinions from the Fourth District’s Div. Three— Moran v. Prime Healthcare Management, Inc., decided Sept. 14, 2016, and Dodd v. Citizens Bank of Costa Mesa, filed May 30, 1990—as saying that while allegations in a complaint, for purposes of a demurrer, are accepted as true, so are the contents of attachments, with Dodd saying that allegations in the exhibits “will be given precedence.”

Tangeman protested:

“Appellant alleged that there was no detrimental reliance on the May 7 approval as a factual matter, but this panel now concludes as a matter of law that the developers detrimentally relied on an approval which was not effective until one day after service of the cure-and-correct demand. Why? Because the developers (not the appellant) made this unsubstantiated claim in an unsworn letter that was attached to the complaint for other, independent, reasons.”

He continued:

“Pursuant to this logic, the entire contents of any attachments to a verified complaint would automatically become binding admissions by the complainant, regardless of the source of the attachment or the purpose for which it was attached to the complaint. This constitutes an unwarranted extension of the rule and an exceedingly dangerous trap for the unwary.”

The case is Couey v. City of Lompoc, B305317.

 

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