September 28th, 2016

By: Thomas Law Group

The City of Ceres approved the development of a 300,000 sq. ft. shopping center anchored by a 190,000 sq. ft. Wal-Mart Supercenter to replace an existing Wal-Mart store after an extensive environmental review process. Citizens for Ceres (Citizens) filed a petition for writ of mandate pursuant to CEQA, alleging several defects in the environmental documents the City certified when it approved the project. The trial court denied the petition and Citizens appealed.

After prevailing in the trial court Wal-Mart, as the real party in interest, filed a memorandum of costs in which it requested, among other things, an award against Citizens of $48,889.71 for the cost of preparing the administrative record. Wal-Mart incurred these costs because the City required Wal-Mart to reimburse the City’s costs to have outside counsel prepare the record. The trial court struck this item from Wal-Mart’s memorandum of costs and Wal-Mart filed a separate appeal.

In a partially published opinion, Citizens for Ceres v. City of Ceres, 2016 Cal. App. LEXIS 759, the Fifth Appellate District affirmed the trial court’s denial of Citizens’ petition for writ of mandate, and reversed as to Wal-Mart’s appeal on the cost of preparing the administrative record.

In the unpublished portion of the opinion, the Court rejected Citizens’ CEQA claims that: (1) the EIR certified by the city did not mandate adequate mitigation measures for the urban decay impact of the project; (2) the EIR did not sufficiently analyze the project’s impacts on landfill and recycling facilities and did not mandate adequate mitigation measures for those impacts; (3) the EIR failed to contain adequate information correlating the project’s air pollution impacts with resulting effects on human health; and (4) the City’s statement of overriding considerations was not supported by substantial evidence.

The Court then addressed Citizens’ motion to tax costs. Wal-Mart argued that the trial court erred when it applied Hayward Area Planning v. City of Hayward (2005) 128 Cal.App.4th 176 (Hayward) to bar an award of costs to Wal-Mart for preparation of the administrative record. The Court agreed, explaining that Code of Civil Procedure section 1032 states that a prevailing party is “entitled” to a cost award “as a matter of right” in “any action or proceeding,” except “as otherwise expressly provided by statute.” While Public Resources Code section 21167.6 requires an agreement with the petitioner before an agency can delegate record preparation to a real party, as stated in Hayward, the Court held that an agreement with the petitioner was not required where a real party covers an agency’s costs after the record has been prepared by the agency.

Key Point: Prevailing real parties in interest in CEQA matters may recover costs associated with the preparation of an administrative record where it reimburses an agency’s costs after the record has been prepared by the agency.

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