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Santa Monica Beach v. Superior Court

Supreme Court of California

January 4, 1999, Decided

No. S052824.


 [*956]  [**995]  [***95]    MOSK, J. 

In this case we consider whether a trial court properly sustained a demurrer to a complaint alleging that a city's rent control law violates the  [*957]  takings clause of the Fifth Amendment to the United States [****2]  Constitution and the equivalent provision under the California Constitution because of that law's alleged failure to fulfill its stated objectives. We conclude that the trial court was correct to sustain the Santa Monica Rent Control Board's demurrer to petitioner's cause of action for inverse condemnation, and we accordingly reverse the Court of Appeal's judgment.


Petitioner Santa Monica Beach, Ltd. (SMB), alleged the following in its complaint for inverse condemnation and petition for writ of mandate, which we accept as true for purposes of assessing the complaint's sufficiency to withstand a demurrer. ( Quelimane Co. v. Stuart Title Guaranty Co. (1998) 19 Cal. 4th 26, 34, fn. 3 [77 Cal. Rptr. 2d 709, 960 P.2d 513].)

In April 1979, the City of Santa Monica (the City) adopted a rent control charter amendment (hereinafter sometimes the Rent Control Law) and created an elected rent control board (Board) to regulate rentals. Among other things, the Rent Control Law requires that owners register each rental unit and pay annual registration fees to the Board, establishes maximum allowable rents, provides for annual general adjustments and individual [****3]  adjustments of allowable rents, prohibits evictions except for specified reasons, and prescribes remedies for violations of its provisions.

The stated purpose of the Rent Control Law, as expressed in the preamble to the charter amendment, was as follows: "A growing shortage of housing units resulting in a low vacancy rate and rapidly rising rents exploiting this shortage constitute a serious housing problem affecting the lives of a substantial portion of those Santa Monica residents who reside in residential housing. In addition, speculation in the purchase and sale of existing residential housing units results in further rent increases. These conditions endanger  [**996]   [***96]  the public health and welfare of Santa Monica tenants, especially the poor, minorities, students, young families, and senior citizens. The purpose of this Article, therefore, is to alleviate the hardship caused by this serious housing shortage by establishing a Rent Control Board empowered to regulate rentals in the City of Santa Monica so that rents will not be increased unreasonably and so that landlords will receive no more than a fair return."

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19 Cal. 4th 952 *; 968 P.2d 993 **; 81 Cal. Rptr. 2d 93 ***; 1999 Cal. LEXIS 2 ****; 99 Cal. Daily Op. Service 95; 99 Daily Journal DAR 131


Subsequent History:  [****1]  Certiorari Denied May 24, 1999, Reported at: 1999 U.S. LEXIS 3468, 67 U.S.L. Week 3715.

Prior History: Superiro Court Los Angeles County. Super. Ct. No. SS005266. Alan B. Haber, Judge.

Disposition: For all of the foregoing, we reverse the judgment of the Court of Appeal and remand with directions to reinstate the judgment of the trial court.


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