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Overview of Legislation

AB 1492 (Laird, Chapter 694)

Effective January 1, 2004

 

AB 1492 adds Section 51250 to the Government Code. Section 51250 provides an additional and alternate remedy from the contract cancellation petition (§51281-et. seq.) for a material breach of contract. Additionally, AB 1492 amends Section 51257 by extending the Williamson Act lot line adjustment provisions to January 1, 2009.

Material Breach of Contract

Section 51250(b) defines a material breach on land subject to a Williamson Act contract as a commercial, industrial or residential building(s), exceeding 2,500 square feet that is not permissible under the Williamson Act or contract, local uniform rules or ordinances. AB 1492 only applies to structure(s) that have been permitted and constructed after January 1, 2004.

City/County Responsibilities

It is the responsibility of the contracting city or county to determine if a breach of contract exists. If the Department of Conservation discovers a possible breach, it will notify the city or county. Once aware of a possible breach, the city/county will determine if there is a valid contract on the subject property and if the breach is material. Within 10 days of determining that a breach of contract is likely, the city/county will send a notice explaining its determination of the breach of contract and a copy of the land conservation contract by certified mail to the landowner and Department.

If the landowner or landowner’s representative notifies the city/county of their intention to eliminate the conditions of the breach of contract within 60 days of receipt of the notice, the landowner shall have an additional 60 days to eliminate the condition of the breach. If the landowner fails to notify the city/county of his intention the city/county shall schedule a hearing no more than 120 days after the initial notice of determination was served to the landowner. Notice must be sent to the landowner, the department and specified neighboring contracted landowners at least 30 days prior to the hearing.

If upon evidence presented at the public hearing the city/county determines a breach of contract has occurred, the city/county shall either order the landowner to eliminate the breach condition within 60 days or assess a monetary penalty.

If the landowner is ordered to eliminate the condition that resulted in the material breach, and fails to do so within the time period specified, the city/county may abate the breach as a public nuisance.

Penalty

The monetary penalty shall be 25% of the unrestricted fair market value of the land rendered incompatible by the breach, plus 25% of the value of the incompatible building and any related improvements on the contracted land.

The assessment of a monetary penalty shall be secured by a lien payable to the county treasurer. Failure to pay the lien within 60 days of recording will result in simple interest of 10% per year accruing until the penalty is paid.

The lien document must provide the name of the real property owner of record and a legal description or APN of the real property to which it is attached. It must also provide a telephone number and address for interested parties to contact to determine the final amount of assessments and penalties owing on the lien.

The city/county may deduct from the penalty any funds for the actual cost of administering this section and shall transmit the balance of the funds by the County treasurer to the State controller. The city/county may determine that equity would permit a lesser penalty. A reduction may be negotiated between the city/county, landowner and department and may not exceed one-half of the original penalty.

Contract Termination by Breach

Once payment of the lien is complete, the city/county will record a release of the lien and a certificate of contract termination by breach with the county recorder for that portion of the contract made incompatible by the breach.

Department of Conservation

The Department may carry out the responsibilities of a city/county if: the city/county fails to determine if there is a material breach within 210 days of discovery of the breach or the city/county fails to complete the requirements of this section within 180 days of the determination that a breach exists. The city/county may request an extension of time to act from the Department. The Department shall notify the city/county 30 days prior to its exercise of any responsibility.

AB 1492 does not limit the authority of the Secretary of the Resources Agency under Sections 16146 or 16147 of the Government Code.

Statement of Termination or Cancellation

After January 1, 2004, landowners affected by the termination or cancellation provisions of §§ 51243.5, 51280 and 51290 must provide a notarized statement within 30 days, signed under penalty of perjury to the board/council. The statement must acknowledge that the breach of contract provisions may apply if: 1) the actions of the local government are rescinded, 2) a court permanently enjoins, voids, or rescinds the cancellation or termination or; 3) for any other reason, the land continues to be subject to the contract. Upon completion the statement must be filed with the county recorder.

For contract cancellations or terminations that occurred before January 1, 2004, the above statement is required prior to the approval of a building permit necessary for construction of a commercial, industrial or residential building.

Exceptions

  • A building constructed prior to 1/1/04 or permitted prior to 1/1/04.

  • A building not in breach at the time of construction but became a breach because of a change in law or ordinance.

  • A building owned by the State.

Contracts terminated or cancelled pursuant to §§ 51243.5, 51280 and 51290, unless the action terminating or canceling the contract is rescinded or determined by a court to be improperly executed or for any reason, so that the land continues to be subject to contract.