Top Appellate Reversal: Property Reserve Inc. v. Superior Court

To gauge the feasibility of Gov. Jerry Brown's multibillion-dollar water conveyance project, the Department of Water Resources has to conduct geological and environmental tests on more than 150 privately owned parcels of land, including boring 200-foot holes in the soil and observing plant and animal species over the course of multiple years.

Private property owners who claimed DWR left drilling equipment on their land for weeks, among other intrusive practices, challenged the constitutionality of public agencies' precondemnation inspection rights — the so-called "entry statute" — that allows them to conduct tests on private lands they may want to acquire under eminent domain.

The long-unchanged statute has worked well for intrusions lasting a few days, said Norman E. Matteoni of Matteoni O'Laughlin & Hechtman, lead counsel for real estate leaser Property Reserve Inc. But would it apply to the extensive occupations required for a massive public works project?

The state Supreme Court ruled that it does. It upheld the statute in Property Reserve Inc. v. Superior Court, affirming and strengthening the government's right to precondemnation inspections. The decision reversed the 3rd District Court of Appeal's ruling that the agency's action constituted a "taking" and that the state needed to file a lawsuit to access private property.

"The entire purpose of precondemnation entry and testing is to enable the public entity to determine whether or not the property is suitable and should be acquired for a public project," Chief Justice Tani G. Cantil-Sakauye wrote for the court.

Tweaking the statute, the high court determined that the property owners have a constitutional right to a jury trial to determine just compensation.

Matteoni said once he "adjusted" to the decision, he concluded the Supreme Court's ruling ultimately has a "positive effect on property owners."

— Lila Seidman