CA Appeals Court Holds Landowner Had Vested Right to Construct Crematorium Pursuant to Building Permit

Stewart Enterprises, Inc. and SE Combined Services of California, Inc. obtained a building permit to construct a crematorium on a site in East Oakland. Five days later, the Oakland City Council passed an emergency ordinance requiring a conditional use permit (CUP) to operate new crematoria. Stewart administratively appealed a determination that the emergency ordinance applied to its proposed crematorium, but Oakland’s Planning Commission denied the appeal. Stewart then brought this action, which included administrative-mandamus claims, against the City of Oakland, the City Council, and the Planning Commission. The trial court granted one of Stewart’s claims petitioning for writ of administrative mandamus, ruling that Stewart had a vested right in the building permit based on a preexisting local ordinance and that the emergency ordinance was not sufficiently necessary to the public welfare to justify an impairment of that right.

The City first argued that the requirement of a CUP for new crematoria imposed by the emergency ordinance trumped any right the permit-vesting ordinance might have otherwise conveyed. Specifically, the City argued that it had the authority to impose a CUP requirement and override preexisting legislation through an emergency ordinance, which controlled over the permit vesting ordinance. However, under its plain terms, the permit-vesting ordinance conveyed a vested right because it shielded the holder of a lawfully issued building permit from having to comply with any subsequently adopted zoning regulations if such regulations would “prohibit the construction … authorized by said permit.” Moreover, even if the emergency ordinance was lawfully passed and the City Council intended it to override the permit-vesting ordinance, the City offered no argument as to why the permit-vesting ordinance failed to confer a vested right on Stewart when Stewart obtained the building permit.

The City next claimed that even if Stewart had a vested right in the building permit, the application of the emergency ordinance to the project did not impair that right because requiring a CUP did not amount to “prohibiting” the crematorium’s construction. Here, the emergency ordinance “prohibited” the construction of a crematorium as authorized by Stewart’s building permit, since once the emergency ordinance was applied to the project, Stewart was no longer allowed to build the crematorium because it did not have a CUP. The court further determined that the possibility Stewart could regain the right to build the crematorium if it applied for and was granted a CUP did not change the fact that a project could be “prohibited” even if the fulfillment of certain contingencies might at some later date reauthorize it. Lastly, the court concluded that there was insufficient evidence of a danger or nuisance to the public that justified the City’s application of the emergency ordinance to Stewart’s project.

Stewart Enterprises, Inc. v City of Oakland, 248 Cal. App. 4th 410 (CA. App. 6/23/2016)