This monthly update presents real estate related issues pending before the United States and California Supreme Courts. Cases are listed by subject matter. Cases with opinions issued by a lower court and accepted by the United States or California Supreme Court are located in the “Recent Case Decisions.” Cases currently under review and pending before the United States or California Supreme Court are not citable illustrations of law.

Three red asterisks (***) indicate cases added since our prior issue.

 

United States Supreme Court

Arbitration

CompuCredit Corp v. Greenwood

(No. 10–948) – Whether, after a valid arbitration agreement has been agreed to, claims brought under the Credit Repair Organizations Act can be heard in court.

Bankruptcy

Bank of America, NA v. Toledo-Cardona

(No. 13-1421 and 14-163) – Whether a Chapter 7 debtor may “strip off” a junior mortgage lien when the outstanding mortgage balance owed to a senior lienholder exceeds the current fair market value (FMV) of the property?

Harris v. Viegelahn

(No. 14-1400) – Whether, when a debtor converts a bankruptcy case to Chapter 7 after confirmation of a Chapter 13 plan and undistributed funds are held by the Chapter 13 trustee, are the funds refunded to the debtor or distributed to creditors?

Fair Housing

Bank of America v. City of Miami

(No. 15-1111) – Whether a city may sue a lender under the Federal Fair Housing Act (FFHA) for predatory lending when the foreclosures that result from the predatory practices only indirectly affect the city.

Texas Department of Housing and Community Affairs v. The Inclusive Communities Project

(No. 13-1371) – Whether, in the absence of a stated intent to discriminate, actions which have the implicit effect of perpetuating housing segregation violate the Fair Housing Act.

Wells Fargo v. City of Miami

(No. 15-1112) – Whether a city may sue a lender under the Federal Fair Housing Act (FFHA) for predatory lending when the foreclosures that result from the predatory practices only indirectly affect the city.

Finance

Jesinoski v. Countrywide Home Loans

(No. 13-684) — Whether, to satisfy the requirement of notifying a lender of a borrower’s intent to exercise their right to rescind a transaction, the borrower may notify the lender in writing within three years of closing the transaction or whether the borrower needs to file a lawsuit within three years of closing the transaction.

Government Property

BP America Production Co. v. Watson

(No. 05-669) – Whether a statute of limitations period applies to federal agency orders demanding the payment of money claimed by the agency under a lease agreement.

Legal aspects

Magner v. Gallager

(No. 10-1032 )Whether the claim that, to be compliant with the Fair Housing Act, owners of properties who rent disproportionately to African-Americans must increase their operating costs, is recognizable by the court under the Fair Housing Act.

Real Estate Settlement Procedures Act (RESPA)

Tammy Foret Freeman, et al. v. Quicken Loans

(No. 10-1042) – Whether, for an unearned fee charged by a real estate settlement services provider to be considered a violation of the Real Estate Settlement Procedures Act (RESPA), the fee must be divided between two or more parties.

Taxes

Armour v. Indianapolis Docket

(No. 11-161) – Whether a local taxing authority may forgive the tax obligations of homeowners who chose to pay over a multi-year installment plan, while concurrently refusing to refund payments made by property owners who paid their assessments in full.

United States of America v. Gary Woods

(No. 12-562) – Whether an IRS tax penalty applies to an underpayment resulting from a real estate transaction designed to generate a tax loss by inflating an owner’s basis in a property.

 

California Supreme Court

 

Arbitration

Cheroti v. Harvey & Madding

(S218724) – Whether the Federal Arbitration Act preempts state unconscionability law regarding an arbitration provision in a consumer contract. [Precedent for the same arbitration issue will be set by Sanchez v. Valencia Holding Co. LLC also pending before the California Supreme Court]

Galen v. Redfin Corp.

(S220936) – Whether the Federal Arbitration Act preempts state unconscionability law regarding an arbitration provision in a consumer contract. [Precedent for the same arbitration issue will be set by Sanchez v. Valencia Holding Co. LLC also pending before the California Supreme Court]

Hernandez v. W.R. Thomas, Inc.

(S224451) – Whether the Federal Arbitration Act preempts state unconscionability law regarding an arbitration provision in a consumer contract. [Precedent for the same arbitration issue will be set by Sanchez v. Valencia Holding Co. LLC also pending before the California Supreme Court]

McGill v. Citibank, N.A.

(S224086) – Whether the Federal Arbitration Act preempts state law that statutory claims for public injunctive relief are not subject to mandatory arbitration.

Sanchez v. Valencia Holding Co. LLC

(S199119) – Whether the Federal Arbitration Act preempts state unconscionability law regarding an arbitration provision in a consumer contract.

Tarrant Bell Property, LLC v. Superior Court

(S179378) – Whether a trial court may refuse to enforce an arbitration provision contained in a lease for fear of judicial inefficiencies.

Trabert v. Consumer Portfolio Services, Inc.

(S220936) – Whether the Federal Arbitration Act preempts state unconscionability law regarding an arbitration provision in a consumer contract. [Precedent for the same arbitration issue will be set by Sanchez v. Valencia Holding Co. LLC also pending before the California Supreme Court]

Wisdom v. Accentcare, Inc.

(S200128) – Whether an arbitration provision in an employment application is unconscionable for lack of mutuality, or whether the provision is binding on both parties and enforceable.

Assessments

Concerned Citizens for Responsible Government v. West Point Fire Protection Dist

( S195152) – Whether an assessment imposed by a fire protection district for fire protection services is valid.

Phelps v. Orange County Assessment Appeals Bd.

(S174418) – Whether the vesting of a life estate constitutes a change of ownership triggering reassessment.

Attorney duty of loyalty

Oasis West Realty, LLC v. Goldman

(S181781) – Whether an attorney who represented a real estate developer breached his duty of loyalty to the developer when the attorney later engaged in political opposition to the development years after his representation of the developer.

Attorney fees

75 Tract 19051 Homeowners Assn. v. Kemp

(S211596) – Whether a prevailing homeowner is entitled to attorney fees in an action by a homeowners’ association (HOA) to enforce its governing documents when it was later determined the HOA’s governing documents had not been properly enacted.

Contracts

Edwards v. Arthur Andersen LLP

(S147190) – Whether all employee non-competition provisions in employment agreements are unenforceable or only those employee non-competition provisions which prevent an employee’s pursuit of a lawful trade or business on termination of the employee.

Sterling v. Taylor

(S121676) – Whether oral evidence can be used to clarify the ambiguities in a written agreement to provide the terms needed for an enforceable agreement.

Conveyance

Ste. Marie v. Riverside County Regional Park & Open-Space Dist.

(S159319) – Whether property acquired by a regional park was “actually dedicated” for recreational purposes requiring voters to consent to its transfer to a school district.

Defense

City of Santa Barbara v. Superior Court (Janeway)

(S141643) – Whether parents of a child who died during activities operated by the city may sue the city for gross negligence after signing an agreement releasing the city of liability.

Eminent Domain

Los Angeles County Metropolitan Transit Authority v. Alameda Produce Market

S188128 – Whether a lender’s withdrawal of a portion of a probable compensation deposit in an eminent domain action negates the property owner’s right to challenge the taking.

Mt. San Jacinto Community College District v. Superior Court

(S132251) – Whether, in a quick-take eminent domain action, the property’s date of valuation is the date of trial or the date compensation is deposited with the court. [For RCD of (uncitable) lower court opinion click here.]

Young’s Market Company v. Superior Court

(S230808) — Whether pre-eminent domain surveying actions constitute a taking of property entitling the owner to compensation. [For RCD of (uncitable) lower court opinion click here.]

Environmental Documents

California Building Industry Assn. v. Bay Area Air Quality Management Dist.

(S213478) — Whether the California Environmental Quality Act (CEQA) requires an analysis of how existing environmental conditions will impact future residents of a proposed project.

Communities for a Better Environment v. South Coast Air Quality Management Dist.

(S161190) – Whether, in determining if a project requires preparation of an Environmental Impact Report, a baseline level of allowed emissions under an existing permit can be relied upon if it does not reflect existing physical conditions.

Regional Council of Rural Counties v. State of California (Department of Water Resources)

(S138975) – Whether an environmental impact report which fails to include critical information is legally sufficient.

Stockton Citizens for Sensible Planning v. City of Stockton

(S159690) – Whether all relevant periods for challenging the unpublished approval of a project by the planning director as in compliance with the master development plan, and thus exempt from the California Environmental Quality Act (CEQA), commenced to run on the planning director’s administrative approval of the project.

Tomlinson v. County of Alameda

(S188161) – Whether a petitioner must exhaust all administrative remedies prior to challenging a public agency’s determination a project is exempt from the California Environmental Quality Act (CEQA).

Environmental hazards

Nelson v. Exxon Mobil Corp.

(S179122) – Whether the right to recover punitive damages runs with the transfer of a property when a third party damages the property before it is sold to a new owner, or in the alternative, can the right, if assigned, be enforceable.

Environmental Law

Metcalf v. County of San Joaquin

(S144831) – Whether, for a public entity to be liable for an injury caused by a hazardous condition on its property, the injured person must show the public entity wrongfully created the hazard.

Foreclosure

Biancalana v. T.D. Service Co

(S198562) – Whether, when a trustee’s sale has taken place but the trustee has not yet delivered the deed to the highest bidder, the trustee may set aside the sale if he makes an error in the processing and announcement of a beneficiary’s credit bid. [For RCD of (uncitable) lower court opinion click here.]

Boyce v. T.D. Service Co.

(S226267) — Whether a defaulting borrower has standing to challenge an assignment of a note and trust deed after the successor lender forecloses on the defaulting borrower’s property. [Precedent for the same issue will be set by Yvanova v. New Century Mortgage Corp also pending before the California Supreme Court. For RCD of (uncitable) Yvanova lower court opinion click here.]

Coker v. JP Morgan Chase Bank, N.A.

(S213137) — Whether a lender may obtain a deficiency judgment against an owner on a short sale when the lender approved the sale on the condition the owner remain liable for any outstanding balance on the nonrecourse loan following the sale. [For RCD of (uncitable) lower court opinion click here.]

First California Bank v. McDonald

(S222858) – Whether a lender may obtain a deficiency judgment against an owner on a short sale when the lender approved the sale on the condition the owner remain liable for any outstanding balance on the nonrecourse loan following the sale. [Precedent for the same issue will be set by Coker v. JP Morgan Chase Bank, N.A also pending before the California Supreme Court]

Gehron v. Bank of America

(S231447) ­ — Whether a defaulting borrower has standing to challenge an assignment of a note and trust deed after the successor lender forecloses on the defaulting borrower’s property. [Precedent for the same issue will be set by Yvanova v. New Century Mortgage Corp also pending before the California Supreme Court. For RCD of (uncitable) Yvanova lower court opinion click here.]

Gehron v. Nicholas

(S231459) ­ — Whether a defaulting borrower has standing to challenge an assignment of a note and trust deed after the successor lender forecloses on the defaulting borrower’s property. [Precedent for the same issue will be set by Yvanova v. New Century Mortgage Corp also pending before the California Supreme Court. For RCD of (uncitable) Yvanova lower court opinion click here.]

Keshtgar v. U.S. Bank

(B246193) — Whether a defaulting borrower has standing to challenge an assignment of a note and trust deed after the successor lender forecloses on the defaulting borrower’s property. [Precedent for the same issue will be set by Yvanova v. New Century Mortgage Corp also pending before the California Supreme Court. For RCD of (uncitable) Yvanova lower court opinion click here.]

Mendoza v. JPMorgan Chase Bank

(S220675) — Whether a defaulting borrower has standing to challenge an assignment of a note and trust deed after the successor lender forecloses on the defaulting borrower’s property. [Precedent for the same issue will be set by Yvanova v. New Century Mortgage Corp also pending before the California Supreme Court. For RCD of (uncitable) Yvanova lower court opinion click here.]

Yvanova v. New Century Mortgage Corp.

(S218973) — Whether a defaulting borrower has standing to challenge an assignment of a note and trust deed after the successor lender forecloses on the defaulting borrower’s property. [For RCD of (uncitable) lower court opinion click here.]

Government Property

Murphy v. Burch

(S159489) – Whether an easement by necessity is available to a parcel of land when the government owned and conveyed it without first acquiring the easement by eminent domain. [For RCD of (uncitable) lower court opinion click here.]

Indemnity

Prince v. Pacific Gas & Electric Company

(H028957) – Whether a landowner can claim implied contractual indemnification for injury to another caused by power lines against a power company which has statutory immunity from such injury.

Insurance

Century National Ins. Co. v. Garcia

(S179252) – Whether a homeowner’s fire insurance provider must pay damages to an innocent homeowner when the fire was deliberately set by a co-insured family member.

Kaiser Cement & Gypsum Corp. v. Insurance Co. of State of Pennsylvania

(S194724) – Whether, when continuous property damage occurs while covered by concurrent insurance policies, is each insurer liable for all damage up to the amount of its policy limit.

State of California v. Continental Ins. Co.

(S170560) –Whether, when two insurance policies are concurrently held, each insurer is independently liable for property damage occurring during and outside both insurers’ policy periods.

Land Use and Zoning

City of Santa Monica v. Gonzalez

(S145571) – Whether a city’s failure to give proper notice to a property owner before the city repairs or abates a nuisance invalidates the appointment of a receiver to remedy the substandard condition of the owner’s property.

Whether a receiver appointed by the city is permitted to sell or demolish substandard improvements on a property when the owner wishes to use the improvements as his family residence.

Hernandez v. City of Hanford

(S143287) – Whether an ordinance limiting furniture sales to retail stores of a minimum size in a particular commercial zone violates the equal protection rights of small retail store owners.

Manta Management Corporation v. City of San Bernardino

(S144492) – Whether an adult nightclub accused of allowing prostitution on its premises is entitled to be compensated by the city when the city obtains a preliminary injunction based on a zoning ordinance later declared unconstitutional.

Orange Citizens for Parks & Recreation v. Superior Court

(S212800) — Whether a proposed low density housing development project is consistent with the city’s general plan.

Pacific Palisades Bowl Mobile Estates, LLC v. City of Los Angeles

(S187243) – Whether the Mello Act and the California Coastal Act apply to the conversion of a mobilehome park to residential ownership if the park is located within a coastal zone. [For RCD of (uncitable) lower court opinion click here.]

Landlords, Tenants and Property Management

Cacho v. Boudreau

(S133378) – Whether a mobilehome park owner’s inclusion of property taxes in rent as a pass-through charge violates the Mobilehome Residency Law. [For RCD of (uncitable) lower court opinion click here.]

DKN Holdings LLC v. Faerber

(S218597) Whether, after a landlord is awarded money losses from a defaulting tenant, may the landlord pursue the other co-tenant who is jointly and severally liable under the lease for the same losses. [For RCD of (uncitable) lower court opinion click here.]

Legal aspects

Beacon Residential Community Assn. v. Skidmore, Owings & Merrill LLP

(S208173) – Whether an architect who negligently provided services to a residential developer is liable to buyers of the developer’s properties.

Ralphs Grocery Co. v. United Food & Commercial Workers Union Local 8

(S185544) – Whether the parking area and walkway in front of a retail store within a larger shopping center constitutes a “public forum” for the purposes of a labor union protest. [For RCD of (uncitable) lower court opinion click here.]

Riverisland Cold Storage, Inc. v. Fresno-Madera Production Credit Assn.

(F058434) – Whether evidence of factual misrepresentation regarding the terms contained in a written agreement at the time it is entered into is admissiblein a court of law.

Liability

Curtis v. County of Los Angeles

(S213275) — Whether a government entity may be liable for an injury resulting from a dangerous condition on public property.

Vasilenko v. Grace Family Church

(S235412) — Whether an owner of public property is liable for injuries to a guest resulting from unsafe conditions near their property. [For RCD of (uncitable) lower court opinion click here.]

Option contracts

Steiner v. Thexton

(S164928) – Whether a real estate contract allowing for buyer revocation is considered an unenforceable option agreement due to lack of consideration, or a purchase agreement since the buyer’s discretion to revoke the contract was eliminated by the covenant of good faith and fair dealing, or was the seller estopped from canceling due to the buyer’s reliance to his detriment on the seller’s promise to sell. [For RCD of (uncitable) lower court opinion click here.]

Property Tax

North Ardmore Avenue v. County of Los Angeles

(S222329) – Whether a county may impose a documentary transfer tax based on a change in ownership or control of a legal entity that holds title to real property.

Mayer v. L & B Real Estate

(S142211) – Whether, after the county fails to provide an owner with a notice of tax sale, the one-year statute of limitations to set aside the tax deed was suspended until the owner became aware of the tax sale.

Public Utilities

Guzman v. County of Monterey

(S157793) – Whether a county is liable for not reviewing and responding to water quality reports as mandated.

Sprint Telephony PCS v. County of San Diego

(S14554) – Whether a county is prevented from regulating the installation of wireless cellular facilities in a public right of way.

Sex offender residency restrictions

People v. Mosley

(G038379) – Whether registered sex offenders are entitled to relief from residency restrictions on the ground that the restrictions are improperly applied retroactively, unreasonable, and unconstitutional.