Court Opinion

ID: 855500
Source: CourtListenerOpinion
Date Created: 2013-03-18 23:07:58.214736+00
Date Added: 2024-06-11T13:22:36.555221
License: Public Domain

Filed 3/18/13 Lin v. City of Pleasanton CA1/3
                      NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.

              IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                       FIRST APPELLATE DISTRICT

                                                DIVISION THREE

JENNIFER LIN et al.,
         Plaintiffs and Appellants,
                                                                         A132046
v.
CITY OF PLEASANTON et al.,                                               (Alameda County
                                                                          Super. Ct. No. RG10519153)
         Defendants and Respondents.

         Plaintiffs Jennifer and Frederic Lin (the Lins) appeal from a judgment dismissing
their complaint against defendants City of Pleasanton and the City Council of the City of
Pleasanton after the trial court sustained a general demurrer without leave to amend. The
Lins ask us to reinstate their lawsuit seeking enforcement of a development agreement.
We affirm the judgment in favor of defendants.

                                                             1
                 FACTUAL AND PROCEDURAL BACKGROUND1
       A.     Background
       The Lins own 562 acres of land in the City of Pleasanton. In November 2003, the
Lins‟ agents, James Tong and Charter Properties, sought approval for (1) a planned unit
development (PUD) of the Lins‟ acreage, which was to be known as “Oak Grove” and
was designated PUD-33; and (2) a development agreement to develop the project site in
accordance with the general plan, the requested PUD and other city approvals.
       On November 6, 2007, the city adopted two ordinances: ordinance No. 1961, “An
Ordinance Approving the Application of James Tong, Charter Properties (Oak Grove
Development), for PUD Plan Approval, As Filed Under Case PUD-33;” and ordinance
No. 1962, “An Ordinance Approving a Development Agreement Between the City of
Pleasanton and Jennifer Lin and Frederic Lin Regarding the Oak Grove Development.”
The ordinances had mirror provisions as to the effect of any voter referendum
challenging the ordinances. Section 5 of ordinance No. 1961, read: “This ordinance shall
be effective thirty (30) days after its passage and adoption, provided, however, that if
ordinance No. 1962 is set aside by referendum, this ordinance shall be of no force or
effect.” Similarly, section 5 of ordinance No. 1962, read: “This ordinance shall be

1
        Because the Lins‟s lawsuit was resolved by demurrer, “we accept as true the
properly pleaded material factual allegations of the complaint, together with facts that
may be properly judicially noticed.” (Hernandez v. City of Pomona (1996) 49
Cal.App.4th 1492, 1497.) The trial court granted the parties‟ requests for judicial notice
of (1) certain documents and the judgment filed in prior litigation between the Lins and
City Manager Nelson Fialho (Lin v. Fialho, Super. Ct. of Alameda County,
No. VG08416511), and (2) the City of Pleasanton Resolution No. 10-389 reciting the fact
of the Special Municipal Elections held on June 8, 2010 declaring the result and such
other matters as provided by law. Both parties refer to the proffered documents, and we
have considered them to the extent they are relevant to our resolution of the appeal.
However, we conclude the trial court properly denied the Lins‟s request to take judicial
notice of transcribed excerpts of the certified audio tape of a November 6, 2007, City
Council meeting. (See Bach v. McNelis (1989) 207 Cal.App.3d 852, 865.) We also
conclude the trial court properly denied as untimely the Lins‟s request for judicial notice
of Fialho‟s responsive pleading in the Lin v. Fialho matter, as well as the entire
administrative record lodged in that litigation.

                                             2
effective thirty (30) days after its passage and adoption, provided, however, that if
Ordinance No. 1961 is set aside by referendum, this ordinance shall be of no force or
effect.”
       Within thirty days of the adoption of the ordinance No. 1961, a referendum
petition was filed with the city clerk seeking to set aside that ordinance. The Lins filed a
petition for a writ of mandate requiring the city clerk to reject the referendum petition.
Although the Lins were successful in the trial court, the proponents of the referendum
petition filed an appeal. Our colleagues in Division Five concluded that the referendum
petition was properly filed. (Lin v. City of Pleasanton (2009) 176 Cal.App.4th 408, 426.)
The trial court was directed to enter an order “denying the writ and requiring that the city
either repeal ordinance No. 1961 or submit the ordinance to the voters at an election
. . . .” (Ibid.) On December 15, 2009, the trial court entered an order authorizing the city
council to either repeal ordinance No. 1961 or place the referendum on the ballot for
voter consideration. On January 19, 2010, the city clerk certified the referendum petition.
The city council ordered that the referendum petition be submitted to the voters at an
election to be held on June 8, 2010.
       During the pendency of the referendum petition litigation, the Lins filed a
successful separate petition for writ of mandate requiring the city manager to sign the
development agreement. On November 20, 2008, the trial court directed the city
manager to sign the development agreement. The development agreement, signed by the
city manager, was recorded on December 1, 2008.

       B.     Current Lawsuit
       On the day of the June 8, 2010, election and before the outcome was known, the
Lins commenced this litigation seeking the equitable relief of specific performance of the
development agreement and related declarative and injunctive relief against defendants.
According to the Lins, the development agreement became an effective and binding
contract on December 7, 2007, thirty days after ordinance No. 1962 was adopted and
during which period no referendum challenging ordinance No. 1962 was filed, that the
referendum challenging ordinance No. 1961 could not affect the development agreement,

                                              3
and that even if the ordinance No. 1961 was set aside by referendum, rendering ordinance
No. 1962 without force and effect, the development agreement would remain in full force
and effect. The Lins also alleged they had asked the city to take action to protect their
vested rights pursuant to the express terms of the development agreement, but the city
had declined to do so. In the first cause of action, labeled “Specific Performance of
Contract Breached by Anticipatory Repudiation,” it was alleged the development
agreement was an enforceable contract and the city‟s refusal to comply with the terms of
the agreement constituted a present breach by anticipatory repudiation. In the second
cause of action, labeled “Breach of the Covenant of Good Faith and Fair Dealing,” it was
alleged the city‟s refusal to take steps to preserve the Lins‟s vested rights under the
development agreement breached the covenant of good faith and fair dealing because the
city knew or should have known that its refusal would give rise to a claim by the
proponents of the ordinance No. 1961 referendum, and possibly others, that the
development agreement was nullified if ordinance No. 1961 was set aside by referendum.
In the third cause of action, labeled “Declaratory and Injunctive Relief,” the Lins sought
certain declarations, including that “[e]ven if [ordinance No. 1961] were set aside by
referendum, and even if [ordinance No. 1962] were set aside due to the [language in
section five], the Development Agreement itself will remain in full force and effect.”
       Four months after the election in which ordinance No. 1961 was set aside by
referendum, defendants filed a general demurrer,2 which was opposed by the Lins. The
trial court sustained the demurrer to each cause of action without leave to amend. In its
written order, the court found, in pertinent part, that “the unambiguous language of
Ordinance No. 1962 contemplates that should Ordinance No. 1961 be repealed by
referendum, Ordinance No. 1962 shall have no force and effect. The only reasonable
interpretation of this language is that it constitutes a conditional acceptance, approving
the development agreement only so long as the condition of Ordinance No. 1961‟s repeal

2
      The trial court granted permission for the filing of opening and reply briefs by
Save Pleasanton‟s Hills, Kay Ayala, and Allen Roberts as amici curiae in support of
defendants‟ demurrer.

                                              4
by referendum did not come to pass. Once the referendum occurred, the condition came
to pass, and no contractual duty was created, or alternatively, at best, was discharged. [¶]
It is not disputed that it was known by all involved parties that Ordinance No. 1961 was
to be the subject of a referendum as early as the day the ordinances were passed on
November 6, 2007. Ordinance No. 1961 and [Ordinance] No. 1962 are inextricably
entwined and clearly designed to be read and interpreted together. See for example, Lin
v. City of Pleasanton[, supra,] 176 Cal.App.4th [at p.] 414 (the development agreement at
issue is referenced as being attached as Exhibit D to Exhibit B of Ordinance No. 1961.)”3
The trial court entered a judgment in favor of defendants. The Lins timely appeal.

                                       DISCUSSION
       Our review of the trial court‟s ruling sustaining defendants‟ demurrer is de novo.
“[W]e do not review the validity of the trial court‟s reasoning but only the propriety of
the ruling itself. [Citation.]” (Wilner v. Sunset Life Ins. Co. (2000) 78 Cal.App.4th 952,
958.)4 “We independently evaluate the complaint, construing it liberally, giving it a
reasonable interpretation, reading it as a whole, and viewing its parts in context.
[Citation.] Treating as true all material facts properly pleaded, we determine de novo
whether the factual allegations of the complaint are adequate to state a cause of action
under any legal theory, regardless of the title under which the factual basis for relief is
stated. [Citation.]” (Burns v. Neiman Marcus Group, Inc. (2009) 173 Cal.App.4th 479,
486-487, fn. omitted.) “A judgment of dismissal after a demurrer has been sustained
without leave to amend will be affirmed if proper on any grounds stated in the demurrer,
whether or not the [trial] court acted on that ground.” (Carman v. Alvord (1982) 31
Cal.3d 318, 324.) When a demurrer is sustained without leave to amend, “ „we decide

3
        The trial court also ruled that to the extent the Lins‟s complaint sought declaratory
relief that ordinance No. 1962 was invalid, that relief was barred by the statute of
limitations. In their reply brief, the Lins note that they are not seeking such relief and
therefore “this aspect of the trial court‟s ruling is irrelevant to the[ir] . . . appeal.”
4
        Consequently, we do not separately address the Lins‟s arguments challenging
certain statements made by the trial court in its order sustaining the demurrer without
leave to amend.

                                              5
whether there is a reasonable possibility that the defect can be cured by amendment; if it
can be, the trial court has abused its discretion and we reverse; if not, there has been no
abuse of discretion and we affirm. [Citations.] The burden of proving such reasonable
possibility is squarely on the plaintiff.‟ [Citations.]” (Zelig v. County of Los Angeles
(2002) 27 Cal.4th 1112, 1126.)
       By this appeal, the Lins seek to reinstate their lawsuit against defendants based on
the development agreement that was adopted by the City Council in ordinance No. 1962.
The “crux” of their appeal is that a fully vested development agreement cannot be
retroactively abrogated by the electorate through the referendum process. According to
the Lins, “[g]iving full effect to Section 5 in [ordinance No. 1962] means only that the
[ordinance] was set aside. It does not, and could not, reach the Development Agreement
after the Development Agreement had taken effect and bec[a]me a vested, enforceable
contract.” We conclude the Lins‟s arguments are unavailing.
       In addressing the Lins‟s arguments, our review of ordinance No. 1962 is “de
novo.” (Holmes v. Jones (2000) 83 Cal.App.4th 882, 888.) “The goal of statutory
construction is to ascertain and apply the intent of the Legislature. To determine that
intent, a court first looks to the statutory words themselves, giving to the language its
usual and ordinary import. The court construes statutory words in context, keeping in
mind the statutory purpose. Statutory sections relating to the same subject must be
harmonized, both internally and with each other, to the extent possible. [Citation].
Where construction of a statute is necessary, interpretation should produce a reasonable
result. Where uncertainty exists, the court must consider the consequences that will flow
from a particular interpretation. [Citation.] If a statute gives rise to two alternative
interpretations, the court should follow the one leading to the more reasonable result.”
(Id. at pp. 888-889.) “[W]e give „significance to every word, phrase, sentence, and part
of an act in pursuance of the legislative purpose. [Citation.]‟ [Citations.] We avoid an
interpretation that renders any portion of the statute superfluous, unnecessary, or a
nullity; this is so because we presume that the Legislature does not engage in idle acts.”
(Teachers’ Retirement Bd. v. Genest (2007) 154 Cal.App.4th 1012, 1028.)

                                              6
       Ordinance No. 1962, “ordain[ed]” as follows: [¶] Section 1. Finds that the
proposed Development Agreement between the City of Pleasanton and Jennifer Lin and
Frederic Lin is consistent with the City‟s General Plan. [¶] Section 2. Approves the
Development Agreement between the City of Pleasanton and Jennifer Lin and Frederic
Lin, a copy of which is attached hereto and incorporated herein by this reference, and the
final form of which is to be approved by the City Attorney. [¶] Section 3. The City staff
is directed to cause a Notice of Determination to be filed pursuant to Section 5.4(g) of
Resolution No. 77-66. [¶] Section 4. A summary of this ordinance shall be published
once within fifteen (15) days after its adoption in „The Valley Times,‟ a newspaper of
general circulation published in the City of Pleasanton, and the complete ordinance shall
be posted for fifteen (15) days in the City Clerk‟s office within fifteen (15 days) after its
adoption. [¶] Section 5. This ordinance shall be effective thirty (30) days after its passage
and adoption, provided, however, that if Ordinance No. 1961 is set aside by referendum,
this ordinance shall be of no force and effect.”
       Thus, by section two of ordinance No. 1962, the City Council enunciated its
approval of the development agreement. However, the approval was not absolute but
was made expressly subject to a condition subsequent, namely, a referendum setting aside
ordinance No. 1961, as enunciated in section five of the ordinance. (Civ. Code, §§ 1434
[“[a]n obligation is conditional, when the rights or duties of any party thereto depend
upon the occurrence of an uncertain event”], 1438 [“[a] condition subsequent is one
referring to a future event, upon the happening of which the obligation becomes no
longer binding upon the other party, if he chooses to avail himself of the condition”].)
Once ordinance No. 1961 was set aside by referendum, ordinance No. 1962, including
section two (representing the City Council‟s approval of the development agreement),
was “of no force and effect.”
       We are not persuaded by the Lins‟s arguments that the language in ordinance
No. 1962 can be read to support a claim that the development agreement survives despite
the referendum setting aside ordinance No. 1961 rendering ordinance No. 1962 of no
force and effect. According to the Lins, the words “of no force and effect” only address

                                              7
ordinance No. 1962 itself and do “not speak to” the development agreement. However,
reading ordinance No. 1962 in context, it is clear that the City Council intended that the
ordinance (representing its approval of the development agreement) would not continue
to be valid and subsisting if ordinance No. 1961 was set aside by referendum. The words
“ „no force and effect‟ have a clear and unmistakable meaning, a meaning which leaves
no doubt as to the intention of” the City Council. (Shaw v. Guaranty Liquidating Corp.
(1945) 67 Cal.App.2d 660, 663 (Shaw).) Thus, on the happening of the specified event
(referendum setting aside ordinance No. 1961), the City Council‟s requisite approval to
enter into the development agreement (represented by section two of ordinance No. 1962)
was of no further force and effect. The consequences of the successful referendum
setting aside ordinance No. 1961 was that the City was relieved of its obligation to
perform under the development agreement and the Lins were divested of any rights to
enforce the agreement or seek damages for its breach. Our interpretation of ordinance
No. 1962 gives effect to the actual words used in that ordinance, and does not add any
terms as suggested by the Lins.5 The consequential effect of the successful referendum
setting aside ordinance No. 1961 and its effects on ordinance No. 1962 and the validity of
the development agreement were self-executing and do not require us to add any terms to
5
        In a footnote in their opening brief, the Lins argue, “The public policy reasons
prohibiting insertion of terms into an ordinance are particularly important here, where the
referendum process is involved. The Elections Code establishes strict rules regarding the
referendum process that are designed to ensure that there is no confusion about what the
voters are being asked to referend. Cal. Elec. Code, § 9235, et seq. [The referendum‟s
proponent‟s] desire to bypass the Elections Code and challenge two ordinances with a
single referendum – essentially a referendum „short cut‟ – is not deserving of judicial
rescue. Doing so would establish precedent that could foster gamesmanship and lead to
voter confusion.” However, as noted by the trial court, the referendum petition
challenging ordinance No. 1961 “was comprised of a copy of ordinance No. 1961, the
CEQA findings attached to and incorporated into that ordinance as exhibit A, the
conditions of approval and attached to and incorporated into that ordinance as exhibit B,
and the development agreement attached to the conditions of approval as exhibit D.” (Lin
v. City of Pleasanton, supra, 176 Cal.App.4th at p. 414, italics added.) Thus, the voters
were given notice of the development agreement that had been approved by the City
Council and would govern the development of the Lins‟s property if the referendum to
set aside ordinance No. 1961 was not successful.

                                             8
the development agreement as suggested by the Lins. (See Athletic Club v. Board of
Harbor Commrs. (1933) 130 Cal.App. 376, 387-388 [if governing statute itself provides
that happening of condition subsequent terminates obligation under contract, then the
condition is self-executing and becomes part of the contract]). 6
       We see no merit to the Lins‟s argument that ordinance No. 1962 must be
construed so as to avoid a divesture or forfeiture of their rights to develop their property
pursuant to the development agreement. “[T]he general rule that equity will not ordinarily
enforce a forfeiture does not apply [because] . . . on the happening of the specified event”
(a successful referendum setting aside ordinance No. 1961), ordinance No. 1962,
including the approval of the development agreement in section two, was of no force and
effect. (Shaw, supra, 67 Cal.App.2d at p. 663.) The Lins entered into the development
agreement knowing the terms of ordinance No. 1962. The development agreement ended
when ordinance No. 1961 was set aside by referendum and ordinance No. 1962 became
of no force and effect.7
       Nor do we see any merit to the Lins‟s argument that an interpretation of the effect
of the referendum on ordinance No. 1961 so as to invalidate ordinance No. 1962
(including the approval of the development agreement) is not permissible because it
unconstitutionally impairs their contractual rights. The Lins‟s argument is based on a

6
        For the same reasons stated in the text of this opinion, we deny the Lins‟s request
for leave to amend their complaint. The Lins ask permission to amend the complaint to
allege that (1) after the suspension of ordinance No. 1961 defendants treated the
development agreement as an effective contract by amending the general plan map on
July 21, 2009, to include the proposed Oak Grove development, and (2) defendants
disavowed the agreement after the successful referendum setting aside ordinance
No. 1961, and failed to protect the Lins‟s vested rights in the development agreement on
the successful referendum setting aside ordinance No. 1961. However, such allegations,
even if true, would not justify granting the Lins any relief. (See, also, First Street Plaza
Partners v. City of Los Angeles (1998) 65 Cal.App.4th 650, 669 [“[n]o case has ever held
that a city may be bound to a contract by estoppel”].)
7
        Wooster v. Department of Fish & Game (2012) 211 Cal.App.4th 1020, 1026-1029,
cited by the Lins, is factually distinguishable from this case, and does not require a
different result.

                                              9
general rule that “ „the repeal of a statute does not ordinarily divest a right that is vested
and complete at the time of the repeal.‟ ” (State of California v. Industrial Accident
Commission (1959) 175 Cal.App.2d 674, 676.) However, the referendum setting aside
ordinance No. 1961, was not the “repeal” of ordinance No. 1962, or “the equivalent of a
retroactive referendum on [ordinance No. 1962],” as suggested by the Lins. Instead,
ordinance No. 1962 expressly provided for the divesting or impairing of the Lins‟s
contractual rights on the occurrence of an express condition (referendum setting aside
ordinance No. 1961) described in ordinance No. 1962 for that purpose.
       Finally, we are not persuaded by the Lins‟s argument that defendants are estopped
from challenging the validity of the development agreement because that issue was
conclusively resolved in Lin v. Fialho. In that earlier litigation, the Lins argued that the
city manager was required to sign the development agreement because the City Council
had adopted ordinance No. 1962, the development agreement had become effective when
ordinance No. 1962 became effective, and ordinance No. 1961 had not been set aside by
referendum. In ruling in the Lins‟s favor, the trial court held only that “[p]ursuant to
applicable law, the City Manager has a present ministerial duty to sign the Development
Agreement approved by the Pleasanton City Council through adoption of Ordinance
No. 1962 on November 6, 2007 . . . .” At the hearing on the matter, the trial court
specifically explained the basis for its ruling: “The City manager does have the
ministerial duty to sign the document. He had a ministerial duty almost a year ago to do
it and he hasn‟t done it. The reasoning by the City manager is unavailing. The City
manager does not have the discretion to make a determination that the timing is not right.
The City Council does, but the City manager doesn‟t.” (Italics added.) Thus, we reject
the Lins‟s assertion that the trial court in Lin v. Fialho must have found the development
agreement was valid as it “could not order the [city] manager to sign a suspended,
ineffective agreement because there would be no ministerial duty to do so.” Even though
the trial court accepted the Lins‟s argument as to the city manager‟s ministerial duty, its
comments and ruling demonstratively show it neither resolved, nor necessarily had to

                                              10
resolve, the specific issue in this litigation – the effect of the successful referendum
setting aside ordinance No. 1961 on the validity of the development agreement.8
       We therefore conclude the trial court properly sustained defendants‟ demurrer
without leave to amend. Accordingly, we affirm the judgment in favor of defendants. 9

                                      DISPOSITION
       The judgment is affirmed. Defendants are awarded costs on appeal.

                                                   _________________________
                                                   Jenkins, J.

We concur:

_________________________
McGuiness, P. J.

_________________________
Siggins, J.

8
       In light of our determination, we do not need to address the parties‟ other
contentions.
9
       The parties request that we take judicial notice of certain documents. The Lins ask
us to consider the following documents: (1) Fialho‟s “response brief in opposition to
petition for writ of mandate” in the Lin v. Fialho litigation, which document had not been
timely submitted or considered by the trial court; and (2) an excerpt of the City of
Pleasanton‟s General Plan, adopted July 21, 2009, and as amended October 19, 2010,
which was not filed in the trial court. Defendants ask us to consider the following
documents, which were not filed in the trial court: (1) certain documents filed in the
Lins‟s litigation relating to their challenge to the ordinance No. 1961 referendum petition
that was resolved in Lin v. City of Pleasanton, supra, 176 Cal.App.4th 408, and
(2) certain documents filed in a new action (Lin v. City of Pleasanton, Alameda County
Superior Court Case No. RG11591651): Lins‟s complaint for damages for breach of
contract based on the development agreement, filed August 22, 2011, and an order, filed
January 5, 2012, abating the new action pending resolution of this appeal. Because
consideration of the parties‟ proffered documents are not necessary to resolve the issues
before us, we deny the requests for judicial notice as moot.

                                              11