CITY OF LAKE ELSINORE v. RANEL DEVELOPMENT COMPANY

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Court of Appeal, Fourth District, Division 2, California.

CITY OF LAKE ELSINORE, Plaintiff, Cross-Defendant and Appellant, v. RANEL DEVELOPMENT COMPANY, Defendant, Cross-Complainant and Respondent.

No. E016259.

Decided: January 13, 1998

Harper & Burns, Orange and Michael B. Montgomery, El Monte, for Plaintiff, Cross-Defendant and Appellant. Best, Best & Krieger LLP, Kendall H. MacVey, Jeffrey V. Dunn and David J. Hancock, Riverside, for Defendant, Cross-Complainant and Respondent.

OPINION

The City of Lake Elsinore (“City”) appeals from a judgment dismissing its complaint for eminent domain and awarding litigation expenses, including attorney's fees, to the property owner on the owner's cross-complaint for inverse condemnation.   We reverse those portions of the judgment challenged by the City.

FACTUAL AND PROCEDURAL BACKGROUND

In 1991, Ranel Development Company (“Ranel”) owned three parcels of real property along Collier Avenue in the City. The Board of Directors of the Redevelopment Agency of the City of Lake Elsinore (“RDA”) adopted a resolution of necessity on May 28, 1991, authorizing an action in eminent domain to acquire property to widen Collier Avenue.   On or before August 20, 1991, the City widened and raised the grade of Collier Avenue, thereby extending the roadway entirely over two of the parcels and over the front portion of the third (collectively, the “subject property”).

The City, not the RDA, filed a complaint in eminent domain on September 4, 1991, seeking to acquire, inter alia, the subject property.   On September 6, the City applied for and obtained an order determining the probable compensation due to Ranel and authorizing the City to take immediate possession of the subject property.  (Code Civ. Proc., §§ 1255.410 & 1255.460.1 )

In October of 1991, Ranel filed its answer to the complaint, in which it admitted that it owned the subject property but denied all other allegations.   In addition, it affirmatively alleged that, for various reasons, the City had no right to take the subject property.   At the same time, Ranel cross-complained for damages for inverse condemnation.   The cross-complaint alleges that the City's complaint fails to state facts constituting a cause of action, that the City had no right to take the subject property, and that in any event the City took the subject property prior to the complaint for direct condemnation being filed.   It seeks both damages for the part taken and severance damages for the remaining property.

The 1994 trial as to the subject property was bifurcated into a nonjury trial concerning Ranel's challenge to the City's right to take, to be followed by a jury trial on damages.   At the conclusion of the first phase of the trial, the trial court found that the City had not adopted a resolution of necessity as required by statute. (§§ 1240.040 & 1245.220.)   Accordingly, it dismissed the City's eminent domain action.

Thereafter, trial proceeded on Ranel's action for damages for inverse condemnation.   After that phase of the trial was completed, the jury awarded damages for the City's taking of the subject property, including severance damages to Ranel's remaining property.   Ranel then moved for costs, including fees for its attorneys, engineer, and appraiser. (§ 1036.)   In February of 1995, over the City's opposition, the trial court granted the request in the total sum of $217,625.57.

A judgment was entered in April of 1995, from which the City appealed in May of 1995.   In December of 1995, in response to objections from Ranel concerning the form of the judgment, the trial court modified the judgment to correct what it characterized as certain clerical errors.

CONTENTIONS

In substance, the only portion of the judgment which the City contests is the award of attorney's fees and other litigation expenses to Ranel.   The City contends that the award is erroneous because:  (1) the trial court erred by dismissing the City's action for direct condemnation, in which fees would not have been recoverable by Ranel;  (2) Ranel's inverse condemnation action was improper;  (3) the amount of the award is not supported by substantial evidence;  and (4) the modification of the judgment was improper.

DISCUSSION

A. THE TRIAL COURT ERRED BY DISMISSING THE CITY'S COMPLAINT FOR EMINENT DOMAIN.

The trial court dismissed the City's complaint for eminent domain (also known as direct condemnation) on two bases:  that the City had failed to adopt a resolution of necessity and that the resolution of necessity that did exist was insufficient.   Neither basis is correct.

1. Ranel Waived Its Contention that There Was No Resolution of Necessity.

“The power of eminent domain may be exercised to acquire property for a proposed project only if all the following are established:  [¶] (a) The public interest and necessity require the project. [¶] (b) The project is planned or located in the manner that will be most compatible with the greatest public good and the least private injury. [¶] (c) The property sought to be acquired is necessary for the project.” (§ 1240.030.) The determination of these individual components of public necessity is fundamentally a political, and thus legislative, decision.  (Anaheim Redevelopment Agency v. Dusek (1987) 193 Cal.App.3d 249, 260, 239 Cal.Rptr. 319.)   A legislative body's formal findings on these and other issues is known as a resolution of necessity. (§ 1245.230.)

A public entity has no right to take property by eminent domain unless it has adopted a sufficient resolution of necessity. (§ 1240.040.) Moreover, it may not file its complaint until the resolution of necessity has been adopted (§§ 1245.220 & 1250.110), and the complaint must allege the existence of that resolution (§ 1250.310, subd. (d)(2)).

A condemnee may object to a public entity's right to take the property by demurrer, answer, or petition for writ of mandate. (§§ 1250.350 & 1245.255.)   Any objection not raised by one of those means is waived. (§ 1250.345.) Ranel having neither demurred nor petitioned the court for a writ of mandate, the objection was made, if at all, in its answer.

 Ranel pleaded several affirmative defenses challenging the sufficiency of the resolution of necessity.   It contends that, because it averred those alleged deficiencies, it was excused from specifically alleging that the City failed to adopt a resolution of necessity at all.   The logic behind that contention, if any, escapes us.   In any event, there is no excuse.   To raise an objection, an “answer shall state the specific ground upon which the objection is taken and ․ the specific facts upon which the objection is based.” (§ 1250.350.) Ranel did not allege, either generally or specifically, that the City had failed to adopt a resolution of necessity or that the resolution under which the condemnation had been filed had actually been adopted by some other entity.

 Nor was the objection raised by the denials in Ranel's answer.   The City's complaint alleges that “[p]rior to the commencement of this action, at a meeting duly and regularly held, the governing body of Plaintiff duly and regularly adopted, by a vote of two-thirds (2/3) of its members, a Resolution of Necessity declaring that the public interest and necessity require acquisition of the Subject Property by eminent domain for the Project.”   In its answer, Ranel stated that it “has no information or belief sufficient to enable it to answer the allegations in [that paragraph], and basing its denial thereon, denies each and every allegation in the paragraph.”

The trial court ruled that Ranel's answer sufficiently raised the objection that the City failed to adopt a resolution of necessity.   It is mistaken, for two reasons.   First, a bare denial fails to comply with the standard of specificity required by section 1250.350.

 Second, “when the existence of an alleged fact may be ascertained from an inspection of a public record, its existence cannot be put in issue by a denial based solely upon information and belief.”  (Art Metal Const. Co. v. A.F. Anderson Co. (1920) 182 Cal. 29, 33, 186 P. 776;  accord, Transworld Systems, Inc. v. Rogan (1989) 210 Cal.App.3d 731, 733, 258 Cal.Rptr. 555;  5 Witkin, Cal. Procedure (4th ed.   1997) Pleading, § 994, pp. 450-451.)   If a defendant responds to an allegation with such a defective denial, the allegation is deemed to have been admitted (§ 431.20, subd. (a);  Art Metal Const. Co., p. 33, 186 P. 776) and the plaintiff has no obligation to prove that undisputed fact at trial (Transworld Systems, Inc., p. 733, 258 Cal.Rptr. 555).   Whether the City adopted a resolution of necessity authorizing the condemnation of Ranel's property is a matter of public record.   Because Ranel could have consulted those records to determine whether or not the allegation was true, it cannot claim that the information necessary to respond positively to the allegation was unavailable.   Therefore, far from raising an objection, Ranel's defective denial actually admitted that the City had adopted a resolution of necessity.

Having failed to specifically plead either the alleged objection or the facts supporting it, the objection was waived.2  Accordingly, the City shall be deemed to have adopted a resolution of necessity at the same time and in the same form as that adopted by the RDA.

2. The Resolution of Necessity Is Sufficient.

Government Code section 7267.2 provides that, before adopting a resolution of necessity, a condemnor shall appraise the property to be acquired and offer to the owner of the property the full amount indicated by that appraisal.   The offer shall be in writing and shall include a summary of the basis for its determination of just compensation.  (Ibid.) Moreover, the resolution of necessity must include a finding that the offer required by Government Code section 7267.2 has been made to the owner. (§ 1245.230, subd. (c)(4).)

 Ranel contended that, while the City did transmit offers to Ranel prior to the adoption of the resolution of necessity, those offers did not comply with Government Code section 7267.2 because the offers were made “under threat of coercion in violation of Section 7267.5 of the Government Code.” 3 While the trial court rejected the claim of coercion, it did agree that the City's offers were made so close to the resolution of necessity as to effectively foreclose any meaningful negotiation, thereby frustrating the public policy favoring negotiated purchases rather than forcible acquisitions through the power of eminent domain.  (Gov.Code, § 7267.1.4) The trial court concluded that the resolution of necessity therefore failed to meet the requirement of section 1245.230.

The trial court is mistaken.  Government Code sections 7267.1 through 7267.7 are merely advisory guidelines which public entities are to follow “to the greatest extent practicable․”  (Gov.Code, § 7267.)   They create no rights in property owners, and the failure of an agency to comply with them does not affect the validity of an eminent domain proceeding.  (Gov.Code, § 7274.)   In short, compliance with them is encouraged but not mandatory.5  (Toso v. City of Santa Barbara (1980) 101 Cal.App.3d 934, 957-958, 162 Cal.Rptr. 210;  cf.  U.S. v. 410.69 Acres of Land (5th Cir.1979) 608 F.2d 1073, 1074, fn. 1 [construing identical language in the federal Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, 42 U.S.C. §§ 4602 & 4651];  Paramount Farms, Inc. v. Morton (7th Cir.1975) 527 F.2d 1301 [same];  Rubin v. Department of Housing & Urban Development (E.D.Penn.1972) 347 F.Supp. 555, 558 [same].)

Because the City was not required to comply with those guidelines, its eminent domain action should not have been dismissed merely because the City failed to “make every reasonable effort” (Gov.Code, § 7267.1, subd. (a)) to acquire the property by negotiation rather than eminent domain.   While negotiation is encouraged, the ultimate decision of whether to acquire property through negotiation rather than eminent domain is one left to the discretion of the acquiring agency. (§ 1230.030.)

3. Ranel Has Not Shown that the Dismissal Can Be Upheld on any Other Basis.

Because we review the trial court's ruling rather than just its reasoning, we now proceed to a determination of whether its dismissal of the complaint can be upheld on any ground not relied upon by the trial court.   Ranel argues that two additional bases justify the dismissal:  a further defect in the resolution of necessity, and the failure of the City to negotiate in good faith.

a. The Resolution of Necessity

 The resolution of necessity must identify the statute authorizing the public entity to acquire the property by eminent domain. (§ 1245.230, subd. (a).)  Ranel alleged in its answer and argued at trial that the City had failed to comply with that requirement.   The resolution merely asserts that the public entity “is authorized and empowered to commence eminent domain proceedings to acquire said subject property pursuant to the eminent domain law, being Title 7, part III of the Code of Civil Procedure.”

Contrary to the implication of that vague reference, the Eminent Domain Law merely specifies how the power of eminent domain is to be exercised.  (Cf. § 1230.020.) The statutes which actually confer that power to various types of public entities are found elsewhere.  (Cf. § 1240.020.) For instance, Government Code section 37350.5 confers that power upon cities.   Thus, the resolution of necessity does not satisfy the statutory requirement that it refer to its statutory authority to exercise the power of eminent domain.

 However, we are not aware of any authority for the proposition that failure to comply with that requirement justifies the dismissal of an eminent domain action.   Dismissal on that basis alone would have been particularly inappropriate in this case, where there was no showing that the deficiency in any way misled or otherwise prejudiced Ranel.

Even if dismissal had been required, that dismissal would have been conditioned upon the failure of the City to amend its resolution of necessity. (§ 1260.120, subd. (c)(2).)   The trial court refused to make the dismissal conditional, but only because one of the grounds upon which it was basing its ruling-i.e., the failure of the City to negotiate and permit Ranel to avoid litigation-could not be cured after the litigation had commenced.   By contrast, the incorrect statutory reference in the resolution of necessity could have been easily cured.   Therefore, an unconditional dismissal cannot be justified on the basis of that defect.

b. Good-Faith Negotiation

Ranel contends that the City's action was properly dismissed because the City had negotiated in bad faith.   It reasons that the City's offer was made under the threat of immediate condemnation, that such an offer violates Government Code section 7267.5's prohibition against coercive negotiating tactics, and that violations of the guidelines in Government Code sections 7267.1 through 7267.7 indicate that a public agency has acted unreasonably or oppressively.

 There are at least two problems with this analysis.   First, the trial court rejected its factual premise when it found that there had been no coercion.   Moreover, even if we were to accept Ranel's analysis, we cannot accept its conclusion that such unreasonable or oppressive conduct would justify dismissal of the City's action.   The only authority on which it relies, Tilem v. City of Los Angeles (1983) 142 Cal.App.3d 694, 191 Cal.Rptr. 229, is inapposite.   There, the condemnor's direct condemnation action had been voluntarily abandoned prior to trial (id., p. 699, 191 Cal.Rptr. 229), so the Tilem court had no occasion to determine whether such conduct would justify an involuntary dismissal of the sort ordered here.

 Similarly, Ranel argues that the City committed itself to condemning the property prior to holding a public hearing on the resolution of necessity, and that commitment invalidates the resolution.   However, Ranel does not cite any evidence of such a prehearing commitment.  (Cal. Rules of Court, rule 15(a).)   Nor does it appear that this argument was argued to the court below as a ground for dismissing the City's action.   For both of those reasons, we decline to consider whether the dismissal could have been justified on that basis.6

In summary, the trial court erred by dismissing the City's action for direct condemnation.

B. THE ERRONEOUS DISMISSAL WAS PREJUDICIAL.

The erroneous dismissal was prejudicial if it affected Ranel's entitlement to an award of litigation expenses.   On the other hand, if those expenses were equally recoverable by Ranel in the City's direct condemnation action or in its own action for inverse condemnation, then the error was harmless.

1. The Record Does Not Establish that Ranel Was Entitled to its Litigation Expenses in the Direct Condemnation Action.

 In condemnation proceedings, the condemnee is always entitled to recover, in addition to just compensation for the taking, his or her costs of suit. (§ 1268.710.) However, such costs must be distinguished from litigation expenses, such as fees for attorneys, appraisers, and engineers. (§ 1235.140.) In a direct condemnation action, a defendant/condemnee is entitled to recover its litigation expenses from the plaintiff/condemnor in only three circumstances:  (1) the proceeding is wholly or partially dismissed for any reason, voluntarily or involuntarily (§ 1268.610, subd. (a)(1));  (2) the defendant defeats the plaintiff's right to take, in whole or in part (id., subd. (a)(2));  or (3) the plaintiff's final offer was unreasonable and the defendant's final demand was reasonable (§ 1250.410).

As explained above, Ranel did not demonstrate that the City had no right to take the property or that the City's action should otherwise be dismissed.   Nor was there a determination concerning the reasonableness of the final offers of the respective sides.7  Accordingly, on the record before us, Ranel has not established the right to recover its litigation expenses for the issues encompassed by the direct condemnation action.

2. No Litigation Expenses or Other Relief Should Have Been Granted On Ranel's Cross-Complaint for Inverse Condemnation.

 In contrast to the rule in direct condemnation actions, a plaintiff/condemnee who successfully prosecutes an action in inverse condemnation is automatically entitled to recover its litigation expenses from the defendant/condemnor. (§ 1036.)   The City argues that when the condemnor has already filed a direct condemnation action and all of the issues to be litigated can be resolved within that direct condemnation action, the condemnee cannot create an entitlement to litigation expenses by filing a redundant cross-complaint for damages for inverse condemnation.   It concludes that Ranel's inverse action was superfluous and an improper basis upon which to justify an award of litigation expenses.   It is correct.

Eminent domain proceedings and inverse condemnation actions “are merely different manifestations of the same governmental power․”  (City of Oakland v. Oakland Raiders (1982) 32 Cal.3d 60, 67, 183 Cal.Rptr. 673, 646 P.2d 835.)   Both types of actions serve to “implement the constitutional rule that private property may not be ‘taken’ (U.S. Const., 5th Amend.) or ‘taken or damaged’ (Cal. Const., art. I, § 19) for public use without just compensation.”  (San Diego Gas & Electric Co. v. Superior Court (1996) 13 Cal.4th 893, 939, 55 Cal.Rptr.2d 724, 920 P.2d 669.)   Thus, the substantive rights at issue in both types of actions are the same.  (Customer Co. v. City of Sacramento (1995) 10 Cal.4th 368, 377, fn. 4, 41 Cal.Rptr.2d 658, 895 P.2d 900.) They differ only procedurally.

One of the principal procedural differences between the two types of actions is that in a direct condemnation action the public entity commences the litigation while in an inverse action the property owner takes the initiative to do so.  (Klopping v. City of Whittier (1972) 8 Cal.3d 39, 43, 104 Cal.Rptr. 1, 500 P.2d 1345.)   Another difference is that, in a direct action, the public entity concedes that it intends to take or damage the property.   As a result, the focus of such an action is usually limited to the amount of compensation owed the property owner.  (San Diego Gas & Electric Co. v. Superior Court, supra, 13 Cal.4th at pp. 939-940, 55 Cal.Rptr.2d 724, 920 P.2d 669.)   By contrast, “ ‘in an inverse condemnation action, the property owner must first clear the hurdle of establishing that the public entity has, in fact, taken [or damaged] his or her property before he or she can reach the issue of “just compensation” ’ ” (Id., p. 940, 55 Cal.Rptr.2d 724, 920 P.2d 669, quoting from Beaty v. Imperial Irrigation Dist. (1986) 186 Cal.App.3d 897, 903, 231 Cal.Rptr. 128.)

Since there is no substantive difference between the direct and inverse actions, it is these procedural differences which explain why a property owner who successfully prosecutes an inverse action is always entitled to recover his or her litigation expenses (§ 1036), while in a direct condemnation action the property owner may do so only in limited circumstances (§§ 1268.610, subd. (a), & 1250.410).   The condemnee's expanded entitlement to expenses in an inverse action is in recognition of the fact that a public entity's failure to initiate a direct condemnation action unnecessarily imposes additional procedural burdens on the property owner.  (Beaty v. Imperial Irrigation Dist., supra, 186 Cal.App.3d at p. 918, 231 Cal.Rptr. 128.)

No such burdens were imposed on Ranel.   By the time Ranel filed its cross-complaint, Ranel knew that the City had filed its action in eminent domain, had applied for and obtained an order for immediate possession, and had taken physical possession of the subject property.   By taking the initiative to file the action necessary to resolve the dispute over the amount of compensation due to Ranel for the taking of the subject property, the City rendered an inverse action unnecessary.   Any burden experienced by Ranel in filing its cross-complaint was gratuitously assumed.   Moreover, by conceding that it was taking the subject property, the City spared Ranel the burden of proving that fact.   Thus, the rationale for entitling successful inverse condemnees to recover their litigation expenses does not apply here.

 Noting that the City took physical possession of the subject property before the City filed its direct condemnation action and obtained an order of possession, and that it was entitled to compensation for that period of unauthorized possession, Ranel argues that it was required to plead that claim for compensation as a cross-complaint.   It is mistaken.   While a defendant must plead a “related cause of action” in a cross-complaint (§ 426.30, subd. (a)), a condemnee's claim for precondemnation damages is not a separate cause of action “related” to the cause of action for direct condemnation.   Instead, “because such damages constitute part of the eminent domain award and the just compensation payable to the property owners” (Richmond Redevelopment Agency v. Western Title Guaranty Co. (1975) 48 Cal.App.3d 343, 350, 122 Cal.Rptr. 434), the claim is an aspect of the same cause of action.   Accordingly, when a direct condemnation action has been filed, a condemnee's claim for precondemnation damages must be raised by answer to the public entity's complaint, not by cross-complaint for inverse condemnation.  (Id., p. 350, 122 Cal.Rptr. 434 [upholding dismissal of cross-complaint];  accord, Redevelopment Agency v. Contra Costa Theatre, Inc. (1982) 135 Cal.App.3d 73, 79, fn. 2, 185 Cal.Rptr. 159;  People ex rel. Dept. Pub. Wks. v. Peninsula Enterprises, Inc. (1979) 91 Cal.App.3d 332, 352-353, 153 Cal.Rptr. 895.)

 Ranel also contends that, “after the dismissal of the City's complaint, there can be no question but that Ranel's claim for inverse condemnation was properly asserted.”   That is true.   In order to continue to assert a claim for precondemnation damages after a condemnor has dismissed its direct condemnation action, a condemnee must file a separate action for inverse condemnation.  (Redevelopment Agency v. Heller (1988) 200 Cal.App.3d 517, 520, 246 Cal.Rptr. 160.)   But here the trial court erred by granting Ranel's motion to dismiss the City's direct action.   The issue is thus whether, when a complaint for direct condemnation and a cross-complaint for inverse condemnation are both pending, and the compensation issues in both actions are the same, may the trial court award litigation expenses to the property owner under section 1036?

 The answer to that question must be, “No.” A condemnee cannot avoid the limitations on its right to recover litigation expenses when responding to an action for direct condemnation simply by filing a cross-complaint for inverse condemnation of the same property.   If a condemnee files such a cross-complaint,8 and if neither it nor the direct condemnation complaint is dismissed prior to trial, the trial court should resolve the issues framed by the complaint and answer to the complaint but grant no relief on the cross-complaint.   Thereafter, entitlement to litigation expenses must be determined in accordance with section 1250.410 (unreasonable offer), not section 1036 (inverse condemnation).

Applying that rule here, where the complaint for direct condemnation complaint was filed first and should not have been dismissed, the award of litigation expenses cannot be justified under section 1036.

In summary, the award of litigation expenses to Ranel was proper only if the complaint for direct condemnation had been properly dismissed.   Since that dismissal was improper, the dismissal and the resulting award of litigation expenses are both prejudicial errors.

C. THE REMAINING CONTENTIONS ARE MOOT.

Having determined that Ranel is not entitled to an award of litigation expenses on this record, we need not determine whether there is substantial evidence to support the amount of the expenses awarded by the trial court.   Similarly, since the substance of the modifications made by the trial court to the previously entered judgment were to reflect its dismissal of the direct condemnation complaint, and since we have concluded that the dismissal must be reversed, we need not consider whether the procedures followed by the trial court in modifying the judgment were permissible.

DISPOSITION 

Those portions of the judgment (1) dismissing the complaint and ordering the trial to proceed on the cross-complaint only (page 2, lines 4-24) and (2) awarding litigation expenses to Ranel (page 6, lines 3-7) are reversed.   In all other respects, the judgment is affirmed as entered on April 11, 1995.   The trial court is directed to vacate its minute order of December 28, 1995.

Ranel shall recover its costs on appeal. (§ 1268.720.) The trial court may entertain a motion pursuant to section 1250.410 for litigation expenses incurred prior to the appeal if brought by Ranel within 30 days after the issuance of the remittitur.

The City's requests for judicial notice, filed concurrently with its opening brief and with its answer to Ranel's petition for rehearing, are denied.

I dissent.   I would find that the trial court did not abuse its discretion in dismissing the eminent domain action.

It is well settled that the trial court abuses its discretion only when the abuse clearly has been shown and there has been a miscarriage of justice.   (Blank v. Kirwan (1985) 39 Cal.3d 311, 331, 216 Cal.Rptr. 718, 703 P.2d 58.)  “The appropriate test for abuse of discretion is whether the trial court exceeded the bounds of reason.   When two or more inferences can reasonably be deduced from the facts, the reviewing court has no authority to substitute its decision for that of the trial court.”  (Shamblin v. Brattain (1988) 44 Cal.3d 474, 478-479, 243 Cal.Rptr. 902, 749 P.2d 339.)

The trial court's decision to dismiss the eminent domain action is sustainable on at least two grounds.   Accordingly, it is apparent that the trial court did not abuse its discretion in deciding to dismiss the eminent domain action.

Since dismissal of the eminent domain action was within the trial court's discretion, the decision that the action should proceed as an inverse condemnation action was also proper, thus entitling Ranel to its attorney fees.

1. THE TRIAL COURT DID NOT ABUSE ITS DISCRETION BECAUSE ITS DECISION IS SUPPORTED BY ITS FINDING OF LACK OF NOTICE AND OPPORTUNITY TO BE HEARD ON THE NECESSITY ISSUE.

The trial court could reasonably find, under the facts here, that the City and/or the Redevelopment Agency failed to give Ranel the required notice and opportunity to be heard on the question of the necessity for the project.

Code of Civil Procedure section 1245.235, subdivision (a), requires such notice.   It provides:  “The governing body of the public entity may adopt a resolution of necessity only after the governing body has given each person whose property is to be acquired by eminent domain and whose name and address appears on the last equalized county assessment roll notice and a reasonable opportunity to appear and be heard on the matters referred to in Section 1240.030.”

In Conejo Recreation & Park Dist. v. Armstrong (1981) 114 Cal.App.3d 1016, 170 Cal.Rptr. 891, it was held that the failure to give such notice was a due process violation which justified the trial court's decision to dismiss the eminent action.   The same is true here.

2. THE MAJORITY OPINION SHOULD NOT RELY ON TECHNICAL WAIVER FINDINGS.

The majority opinion does not mention Conejo.   It thus fails to recognize that the trial court was justified in finding that the City violated Code of Civil Procedure section 1245.235, and in determining that the violation was a sufficient reason for the dismissal of the eminent domain action.

Instead, footnote 6 of the majority opinion opines that Ranel has waived the lack of notice issue by not adequately raising it in its brief.   Although conceding that the argument was mentioned in the brief, the majority finds that it was not adequately supported by reference to authority and reasoned argument.   The majority also finds that the point was not separately stated under a heading which generally describes the subject matter covered, as required by California Rules of Court, rule 15(a).

Ranel's brief does provide both statutory and record citations for its argument.   It states:  “What is more, the City never gave proper notice of the hearing of the resolution of necessity, as required by Section 1245.235 of the Code of Civil Procedure.   Although the City attempted to show that it had, in fact, given notice, this attempt failed for lack of evidence.  [Citation.]   What is more, nothing in the record suggests that the City or Redevelopment Agency gave any notice to Ranel regarding the resolution adopted by the Redevelopment Agency.  [Citations.]   Consequently, there is ample legal and factual authority for the court to have found that the City had no right to take Ranel's property, thereby requiring a dismissal of the City's complaint.”

The quoted portion of the brief thus cited both law (Code Civ. Proc., § 1245.235) and record references.   Since the statutory violation was clear, I would find that Ranel satisfied any reasonable requirement for the presentation of argument and authority.   The point was also emphasized at oral argument.   Accordingly, I think the majority opinion should address the due process issue, instead of avoiding the substantive issue presented by the constitutional violation asserted by Ranel.

The second ground stated in footnote 6 of the majority opinion is the failure to put lack of notice into a separate heading.   Instead of doing so, the brief discussed the lack of notice in the context used by the trial court by discussing it as a violation of Government Code section 7267.2 which, in turn, constituted a violation of Code of Civil Procedure section 1245.235.

This is, in my view, at most a technical rules violation which should not act to deprive Ranel of its right to raise the constitutional issue of lack of notice.   While I agree with the majority that it would have been preferable to put the argument under a separate heading, we have discretion to forgive the violation and consider the issue.  (Redevelopment Agency v. City of Berkeley (1978) 80 Cal.App.3d 158, 167, 143 Cal.Rptr. 633;  Copfer v. Golden (1955) 135 Cal.App.2d 623, 634-635, 288 P.2d 90.)   The majority does not disclose the reasons that impelled it to exercise its discretion in favor of waiver.

There are two reasons that lead me to the conclusion that we should consider the merits of the issue.   First, a constitutional due process violation is alleged.  (Bonner v. City of Santa Ana (1996) 45 Cal.App.4th 1465, 1476-1477, 53 Cal.Rptr.2d 671.)   As the Bonner court states, constitutional issues should be first raised in the trial court, but may sometimes be raised for the first time on appeal because they present only questions of law.   More generally, Bonner cites the general rule that “ ‘[a]n appellate court may note errors not raised by the parties if justice requires it.’ ”  (Id., at p. 1477, 53 Cal.Rptr.2d 671.)   For the reasons discussed below, the interests of justice require such consideration here.

Secondly, the issue is whether the trial court abused its discretion.   The notice issue is only part of that larger issue, and I think it should be considered only as support for the trial court's exercise of discretion.   The trial court found that the notices sent by the condemnor were not sufficient under Government Code section 7267.2, and that the City had therefore not complied with Code of Civil Procedure section 1245.230.   This was plainly a discretionary decision on its part, and no abuse of discretion has been shown.

Thus, the lack of notice argument should be considered in the context of whether the trial court could properly rely on lack of notice as one of the grounds for its decision.   I believe that it could.  “[T]he failure to give notice in this matter denied defendants the opportunity to make a presentation to the board of supervisors.   The letter of counsel informing defendants that acquisition proceedings had been commenced did not cast upon defendants the duty to ferret out the dates, times, and places where hearings might be conducted which would affect their interest.   Under the circumstances here established they were entitled to notice.”  (Conejo Recreation & Park Dist. v. Armstrong, supra, 114 Cal.App.3d 1016, 1022-1023, 170 Cal.Rptr. 891, fn. omitted.)

3. THE INTERESTS OF JUSTICE REQUIRE CONSIDERATION OF RANEL'S ARGUMENTS ON THEIR MERITS.

In my view, the interests of justice demand consideration of the issues raised by Ranel on their merits.   I would find that Ranel reacted reasonably to the City's trespass.   According to Ranel, City construction crews entered the property and commenced work on August 20, 1991, without obtaining an order for possession or commencing eminent domain proceedings.   The City subsequently filed an eminent domain action which Ranel believed was defective.   Since Ranel apparently believed that it had good grounds for dismissal of the action, it needed to file an inverse condemnation cross-complaint to protect its rights in the event that the eminent domain action was dismissed.   The filing of the cross-complaint for damages was therefore necessary to protect Ranel's ability to recover damages for these actions in the event that the eminent domain complaint was dismissed.

Ranel was eventually successful in obtaining dismissal of the eminent domain action and the case proceeded as an inverse condemnation action.   Since the case proceeded as an inverse condemnation action, Ranel should recover its attorney fees.

By refusing to consider the merits of the issues, the majority opinion in effect rewards the City for proceeding in the manner it did, and it penalizes Ranel for obtaining a dismissal of the eminent domain complaint.   It seems to me to be fundamentally unfair to seize on alleged technical defects in Ranel's briefs to find that the eminent domain action should not have been dismissed when the only consequence of such a finding is to deprive Ranel of recovery of its attorney fees.   In this situation, I believe that the interests of justice require our waiver of technicalities and consideration of the issues on their merits.

I would reach the merits and find that Ranel was entitled to its attorney fees because it acted reasonably in filing its inverse condemnation cross-complaint.  (Code Civ. Proc., § 426.70;  1 Matteoni, Condemnation Practice in Cal. (2d ed.1997) § 8.27, pp. 337-338.)   Since Code of Civil Procedure section 1268.610 provides for an award of litigation expenses, defined to include attorney fees, upon the dismissal of a proceeding for any reason, I would find that the trial court did not abuse its discretion by awarding Ranel its costs and attorney fees.  (Code Civ. Proc., §§ 1268.610, 1235.140.)   After all, the land owner is entitled to recover litigation expenses and the damages it incurred by reason of the City's disregard of the applicable law.

4. THE TRIAL COURT DID NOT ABUSE ITS DISCRETION BECAUSE ITS DECISION IS SUPPORTED BY ITS FINDING THAT THE CITY DID NOT MAKE THE GOOD FAITH OFFER REQUIRED BY GOVERNMENT CODE SECTION 7267.2.

The trial court's decision to dismiss the eminent domain action is also sustainable on an alternate ground.   The trial court found, on the facts presented, that the City had failed to follow Government Code section 7267.2, which requires good faith negotiations and offers to purchase the property prior to condemnation.   Since a resolution of necessity must state that the offer required by Government Code section 7267.2 has been made (Code Civ. Proc., § 1245.230), the lack of a valid offer invalidates the resolution of necessity.

The majority argues that any violation of Government Code sections 7267.1 through 7267.7 is meaningless because the sections only state “guidelines” for negotiation.   Thus, it relies on Government Code section 7267, which states that the sections need only be followed “to the greatest extent practicable.”   In addition, it cites Government Code section 7274, which provides that these sections “create no rights or liabilities and shall not affect the validity of any property acquisitions by purchase or condemnation.”

Despite the majority's conclusion, there is substantial support for the conclusion that Government Code section 7267.2 is mandatory.   The majority opinion relies on Toso v. City of Santa Barbara (1980) 101 Cal.App.3d 934, 958, 162 Cal.Rptr. 210.   Without discussion or analysis, the court there stated that Government Code section 7267 does not, by itself, create a cause of action in inverse condemnation, that it only provides a guide to be followed, and that plaintiff's rights to damages were not expanded by the section.

The majority cites, but does not adequately discuss, a later opinion which analyzes these sections, discusses statutory changes affecting Toso, and holds that “the provisions of Government Code section 7267.2 are not merely discretionary guidelines, but mandatory requirements which must be observed by any public entity planning to initiate eminent domain proceedings through a resolution of necessity.”  (City of San Jose v. Great Oaks Water Co. (1987) 192 Cal.App.3d 1005, 1013, 237 Cal.Rptr. 845.)   In another subsequent case, the court said:  “While it has been held that violation of the provisions of Government Code section 7267 et seq. do not give rise to a separate cause of action or a right to damages not already legally recognized [citations], these statutory directives do provide a ready guide for determining whether a public agency has engaged in unreasonable or oppressive precondemnation conduct․”   (Tilem v. City of Los Angeles (1983) 142 Cal.App.3d 694, 705, 191 Cal.Rptr. 229.)   I agree with the analysis in these opinions, and I would therefore find that the provisions of Government Code section 7267.2 are mandatory.

Even if I agreed that Government Code section 7267 et seq. is not mandatory, the fact remains that the Code of Civil Procedure section 1245.230 provides that a valid resolution of necessity must state that the offer required by Government Code section 7267.2 has been made.   If no offer had been made, the trial court would clearly have the discretion to dismiss the action.   Here, the trial court found that the offer that was made was not a valid offer because it was not in the form required by the statute.

In my view, this was equivalent to a finding that no valid offer had been made and that the resolution of necessity was therefore invalid.   Since the trial court clearly had discretion to make such a finding, it also had the discretion to dismiss the eminent domain action for lack of a valid resolution of necessity.

An examination of the evidence reveals substantial support for the trial court's discretionary decision.   The letter for the largest parcel was dated May 21st, and the resolution was adopted May 28th.   The letter stated that the property would be condemned.   As the trial court stated:  “It does not appear to this court that notices of that nature are consistent with the statutory framework.   There is no time under such a framework for the property owner to reasonably attempt to avoid litigation and to comply with the statute.   These letters indicate to anyone who reads them that the city intends to commence suit on May 28th, 1991․  [¶] For these reasons the court finds that plaintiff has not filed a resolution of necessity as required under C.C.P. 1245.230.”

Since this conclusion is a permissible inference from the evidence, the trial court was entitled to dismiss the eminent domain action on these grounds, and it did not abuse its discretion in making this finding.   The majority only substitute their own inferences for those drawn by the trial court. 5.

5. CONCLUSION.

Since the trial court's discretionary decision to dismiss the eminent domain action is sustainable on two valid grounds, no abuse of discretion has been shown.   Accordingly, the action properly proceeded as an inverse condemnation action.   Since Ranel was entitled to recover its attorney fees in an inverse condemnation action, I would affirm the judgment which awarded it those fees.

FOOTNOTES

FN1. Unless specified otherwise, all further section references are to this code..  FN1. Unless specified otherwise, all further section references are to this code.

2.   Section 1250.345 recognizes that the waiver resulting from the failure to raise an objection by answer might be cured by requesting leave to amend that answer.   Had the trial court granted such a request, we would have reviewed its ruling on an abuse-of-discretion standard.   However, Ranel made no such request here, even after the City asserted that any objection had been waived by the failure of the answer to specifically raise the objection that the City had not adopted a resolution of necessity.   Instead, Ranel insisted that its answer sufficiently raised the issue.   There being no request to amend the answer and no order granting leave to amend on the court's own motion, there is no discretionary ruling to review.   Instead, we independently review the allegations of the answer to determine whether, as a matter of law, they place the existence of the City's resolution of necessity in dispute.   As we have explained, they do not.

3.   Government Code section 7267.5 provides:  “In no event shall the public entity either advance the time of condemnation, or defer negotiations or condemnation and the deposit of funds in court for the use of the owner, or take any other action coercive in nature, in order to compel an agreement on the price to be paid for the property.”

FN4. Government Code section 7267.1, subdivision (a), provides:  “The public entity shall make every reasonable effort to acquire expeditiously real property by negotiation.”.  FN4. Government Code section 7267.1, subdivision (a), provides:  “The public entity shall make every reasonable effort to acquire expeditiously real property by negotiation.”

5.   Government Code section 7267.2, which provides that a written offer shall be made to the owner before the adoption of the resolution of necessity, is an exception to that rule.   However, compliance with that particular section is mandatory only because it was subsequently incorporated into section 1245.230, subdivision (c)(4).  (City of San Jose v. Great Oaks Water Co. (1987) 192 Cal.App.3d 1005, 1012-1013, 237 Cal.Rptr. 845.)

6.   In its brief, Ranel also asserts that the City did not give proper notice of the hearing on the proposed resolution of necessity and therefore the resolution is defective and the dismissal of the direct condemnation action was justified.   Ranel repeated that contention at oral argument.   However, we do not consider it, because the point has been waived.Absent a sufficient showing of justification for the failure to raise an issue in a timely fashion, we need not consider any issue which, although raised at oral argument, was not adequately raised in the briefs.   (Japan Line, Ltd. v.County of Los Angeles (1977) 20 Cal.3d 180, 184, 141 Cal.Rptr. 905, 571 P.2d 254;  Barthelemy v. Chino Basin Mun. Water Dist. (1995) 38 Cal.App.4th 1609, 1613, fn. 2, 45 Cal.Rptr.2d 688.) Ranel's contention that a lack of notice justified dismissal was not adequately raised in its brief, for two reasons.First, “ ‘it is incumbent upon an appellant to present argument and authority on each point made.’ ”  (In re Marriage of Ananeh-Firempong (1990) 219 Cal.App.3d 272, 278, 268 Cal.Rptr. 83, quoting from County of Sacramento v. Lackner (1979) 97 Cal.App.3d 576, 591, 159 Cal.Rptr. 1.)  When counsel asserts a point but fails to support it with argument and citations to authority, the court may deem it to be waived, and pass it without consideration.  (People v. Stanley (1995) 10 Cal.4th 764, 793, 42 Cal.Rptr.2d 543, 897 P.2d 481.)   While Ranel noted that Code of Civil Procedure section 1245.235 requires that notice of hearing be given to potential condemnees, it offered neither authority nor reasoned argument for the proposition that the alleged failure to give adequate notice deprived the City of the right to take the property and justified dismissal of the condemnation action.Second, each point sought to be raised in a brief must be separately stated under a heading which generally describes the subject matter covered.  (Cal. Rules of Court, rule 15(a).)   The purpose of that rule is to ensure that appellate courts are “ ‘advised, as they read, of the exact question under consideration, instead of being compelled to extricate it from the mass.’ ”  (Opdyk v. California Horse Racing Bd. (1995) 34 Cal.App.4th 1826, 1831, fn. 4, 41 Cal.Rptr.2d 263, quoting Landa v. Steinberg (1932) 126 Cal.App. 324, 325, 14 P.2d 532.)  “The failure to head an argument as required by California Rules of Court, rule 15(a), constitutes a waiver.”  (Opdyk, p. 1831, fn. 4, 41 Cal.Rptr.2d 263.)No heading in Ranel's 43-page brief refers to the issue of notice.   The three short sentences which purport to raise that issue are found under a heading asserting that “The City Negotiated for the Sale of the Property in Bad Faith When it Negotiated under the Threat of Immediate Condemnation.”   The brief assertion of defective notice is not even set out in a separate paragraph.   Instead, it is sandwiched into the middle of a discussion concerning the City's failure to comply with Government Code section 7267.2.

7.   The determination of reasonableness is a question of fact for the trial court.  (Redevelopment Agency v. Gilmore (1985) 38 Cal.3d 790, 808, 214 Cal.Rptr. 904, 700 P.2d 794.)   While such questions can be determined by a reviewing court as a matter of law if the evidence is undisputed and supports only one conclusion, we cannot do so here, because the record does not contain evidence of the City's final offer.   While Ranel relies upon a reference to the amount of that offer in its own written argument in the trial court, such unsworn recitals are not evidence.   Besides, it appears that the City amended that offer upwards.

8.   Despite Richmond Redevelopment Agency v. Western Title Guaranty Co.,supra, 48 Cal.App.3d 343, 122 Cal.Rptr. 434, and its progeny, there are circumstances under which the filing of a cross-complaint for compensation on an inverse condemnation theory for the same taking alleged in the public entity's direct condemnation complaint might arguably be proper.   For example, if a slow-moving condemnor abandoned its direct condemnation action more than three years after the property was damaged, the statute of limitations might bar the property owner from bringing a separate action for inverse condemnation. (§ 338, subd. (j).)  To protect itself against the consequences of a possible dismissal, a defendant property owner might want to file a cross-complaint prior to that period running.   However, as those circumstances are not before us, we express no opinion on that subject.

McKINSTER, Associate Justice.

RAMIREZ, P.J., concurs.