A state appellate court has found that a provision of the Palo Alto municipal code requiring a 60-day delay prior to the issuance of a demolition permit did not render the permit approval a discretionary act requiring environmental review. The city properly treated the demolition permit as ministerial and exempt from the California Environmental Quality Act (CEQA), the Sixth District Court of Appeal ruled.

The ruling came in the long controversy over the fate of the Juana Briones House, the central portion of which was built during the 1840s as an adobe. The structure was built by Juana Briones de Miranda, a successful businesswoman and early settler of what became North Beach in San Francisco.

The History

In 1988, the owners of the Juana Briones House entered into a historic preservation contract with the City of Palo Alto pursuant to the Mills Act (Government Code, § 50280 et seq.) for a rolling 10-year term. The Mills Act provides property tax abatement in exchange for the owner's agreement to restrict the use of a historic or architecturally significant property. The city had designated the house a historic landmark the previous year. However, the Loma Prieta earthquake caused structural damage to the house in 1989, and the owners were unable to finance repairs. The house was sold to Daniel and Suzanne Meub, who renovated the house without securing permits and in violation of the Mills Act.

In 1996, Jaim Nulman and Avelyn Welczer purchased the house. After a year of unsuccessful negotiations with the city over property restoration, Nulman and Welczer informed the city that they would not renew their Mills Act contract and applied for a demolition permit in 1998.

Litigation Commences

When the city denied the permit, Nulman and Welczer requested a hearing. After the city refused to conduct a hearing, the property owners filed a lawsuit demanding the city either give them a hearing or grant the demolition permit. They also sought relief from further obligations under the Mills Act. The city cross-complained for enforcement of the Mills Act. The Santa Clara County Superior Court issued a writ of mandate compelling the city to conduct a hearing. The city appealed and the Sixth District upheld the lower court ruling in an unpublished decision.

The city's director of planning and community environment conducted the hearing in early 2007. He determined the project was ministerial and, therefore, not subject to CEQA, and he issued the demolition permit.

A group called Friends of Juana Briones House filed a lawsuit challenging the demolition permit approval. The trial court found for the group on the grounds that the demolition permit was discretionary and, thus, subject to CEQA. Nulman and Welczer appealed.

Palo Alto Municipal Code § 16.49.070 provides that a permit to demolish a historic structure outside of the downtown area "(a) requires a permit application and imposes a 60-day moratorium period, (b) requires referral to the city's Architectural Review Board or Historical Resources Board, and (c) permits an extension of the moratorium for up to one year." The property owners argued the section does not grant the city any discretion to decide whether to issue the permit or to determine how the demolition is carried out. Issuing the permit is a purely ministerial act, they argued. Under CEQA, only discretionary actions are subject to environmental review.

Friends argued the mandatory moratorium in section (a) qualifies the ordinance as discretionary because it gives the city time to consider alternatives.

A unanimous three-judge panel of the Sixth District found that under the Municipal Code the issuance of the demolition permit was ministerial because the decision involved only the use of fixed standards or objective measurements, and the city did not have the authority to impose conditions on approval of the permit that would render it discretionary.

Fixed Standards

The court distinguished the case from San Diego Trust & Savings Bank v. Friends of Gill, (1981) 121 Cal. App.3d 203, in which demolition permits were found to be discretionary solely because the San Diego Municipal Code authorized a demolition delay. In Friends of Gill, the relevant municipal code section required the city to investigate and confer with responsible parties, attempt to secure alternatives where appropriate, and take necessary steps for the preservation of the historical site. In comparison, Palo Alto Municipal Code § 16.49.070 requires no exercise of discretion by the city. This court concluded that the phrase imposing a delay on the issuance of the demolition permit did not cause the permit to be discretionary.

"[A]n agency's ability to impose delay does not make its decision discretionary," Justice Richard McAdams wrote for the court. Because there is no choice for the agency, the action is ministerial, he wrote.

Conditions of Approval

The city imposed six conditions on the approval of the permit, including the filing of a tree disclosure statement explaining how a significant tree would be protected. The property owners accepted these conditions, which Friends argued was evidence of the city's discretion.

However, the court found, "[C]onditions alone do not render a project discretionary." McAdams explained, "The pertinent inquiry is whether the appellants [the property owners] could ‘legally compel approval without any changes in the design of its project which might alleviate adverse environmental consequences,' (Friends of Westwood v. City of Los Angeles (1987) 191 Cal.App.3d 259, 267.) Here, appellants' right to the permit was not dependent on their voluntary concessions, and appellants could have compelled issuance of the demolition permit without them. Appellants' concessions thus do not change the ministerial nature of the permit."

The Case:

Friends of the Juana Briones House v. City of Palo Alto, No. H033275, 2010 DJDAR 17657. Filed November 22, 2010.

The Lawyers:
For Friends: Susan Brandt-Hawley, (707) 938-3908.

For the property owners: Gregory Klingsporn, Mitchell, Herzog & Klingsporn, (650) 327-7476.