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Court Rejects Use of a Demurrer to Dispose of a Save Tara-Style CEQA Lawsuit

Tuesday, May 8th, 2012

In Jamulians Against the Casino v. Iwasaki (2012) ___ Cal.App.4th ___, petitioner alleged that a settlement agreement entered between Jamul Indian Village and Caltrans constituted a discretionary approval of a CEQA project by Caltrans.  The settlement agreement at issue disposed of a federal lawsuit between those parties relating to the application of CEQA to the Tribe’s efforts to upgrade its interchange on State Route 94 to allow for access to a proposed casino.  Petitioner argued that the settlement agreement committed Caltrans to grant a permit for the interchange upgrade.

At trial, Caltrans filed a demurrer to the petition.  In conjunction with the demurrer, Caltrans requested and the trial court granted judicial notice of the settlement agreement.  Based on the trial court’s review of the settlement agreement, the court concluded that Caltrans had not committed itself to a project subject to CEQA and sustained Caltrans’ demurrer.  Although no party alleged it was improper for the trial court to grant judicial notice of the settlement agreement, the Third Appellate District requested the parties conduct supplemental briefing on the issue of whether judicial notice was proper.

After considering the supplemental briefs, the Court concluded that the trial court erred in granting judicial notice of the settlement agreement.  The Court explained that in ruling on a demurrer, a court may properly take judicial notice of the existence of a relevant document, but can take judicial notice only of the truth of the contents of documents such as findings of fact, conclusions of law, orders, and judgments.  As the settlement agreement did not constitute findings of fact, conclusions of law, orders, and judgments issued by a court, the Court concluded it was improper for the trial court to consider the truth of the contents of the settlement agreement.

While the last two published appellate decisions to address a Save Tara v. City of West Hollywood (2008) 45 Cal.4th 116 style pre-commitment challenge, Cedar Fair, L.P. v. City of Santa Clara (2011) 194 Cal.App.4th 1150, 1156 and City of Santee v. County of San Diego (2010) 186 Cal.App.4th 55, 60, resolved the litigation on demurrer, the Court here concluded neither decision directly addressed the propriety of granting judicial notice of the agreements at issue in those challenges.  The Court thus concluded that those holdings do not stand for the proposition that it is proper on demurrer for a court to consider the truth of the contents of documents at issue in Save Tara-style litigation.  As a result, the Court reversed the trial court’s judgment dismissing the action and overruling the demurrer.

Key Points:

Save Tara establishes an amorphous fact-specific test that, as a result, has become a commonly litigated CEQA issue.  In Save Tara, the California Supreme Court stated that CEQA is not intended to place unneeded obstacles in the path of project formulation and development.  Early CEQA litigation, such as a Save Tara-style challenge, can itself be an obstacle to project development.  Quick resolution of this early litigation is often critical to maintaining the potential viability of projects.  Use of a demurrer, as seemingly endorsed by the courts in Cedar Fair and City of Santee, has the potential to reduce the length of time, and associated costs, to dispose of Save Tara-style CEQA litigation.  With publication of Jamulians Against the Casino, use of a demurrer as a procedural response to a Save Tara-style challenge appears that it may be considered improper in all but a few limited circumstances.

Written By: Tina Thomas and Chris Butcher
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