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sr-032481--11c' MAR 2 ~ 991 STAFF REPORT T0: Mayor and City Cduncil FROM: City Attorney SUBJECT: Settlement of Boundary Dispute and Related Litigation Re Santa Monica Stake Beach Property Commonly Known as 514 Palisades Beach Road, (People v. Mae West, et al., LASC Case No: WEC 42548) and authority to settle related litigation on substantially same terms and conditions. BACKGROUND A quiet title action was commenced in 1976 in the above case by the State of California, acting by and through the State Lands Commission and the Department of Parks and Recreation, and the City of Santa Monica as plaintiffs. The complaint contains several causes of action and essentially seeks to quiet title to sovereign tidelands located along the Santa Monica State Beach. The City and State contend in this lawsuit that the boundary separating sovereign tidelands frorn private upland property consists of the 1921 Mean High Tide Line surveyed by the City of Santa Monica in 1921 and established as the mean high tide line by Ordinance No. 188 (Commissioners' Series), recorded in Book 431, Page 90 of Official Records, in the Office of the County Recorder of Los Angeles County. At that time the City of Santa Monica was acting in its capacity as grantee of the State's tide and submerged lands upon certain trust and conditions pursuant to Statutes of 1917, Chapter 78, Page 90, approved April 10, 1917. In 1949, the City quitclaimed most of its ownership interests to the State and has since operated the Santa Monica State Beach through an operating agreement with the Department of Parks and Recreation. ~ ~_ U°~ 'U' Q~ ~~~ ~/ A!A'~'2 ~ #g8; The_gurpose,of. surveying and establishing the mean high tide line in 1921 was to make certain and definite the boundary between uplands and tidelands prior to the construction of shoreline structures which were expected to influence the shoreline. Thereafter, the City and the Santa Monica Land Company entered into a boundary agreement in the form of a joint quitclaim deed establishing the 1921 Mean High Tide Line as the boundary for that area extending north of an extension of Montana Avenue to the northerly City limits. The validity of the boundary agreement and the 1921 Mean High Tide Line was challenged and subsequently upheld by the California Supreme Court in Muchenberger v. City of Santa Monica, 206 Cal. 635, decided March 8, 1929. Since 1921, the tidelands waterward of the 1921 Mean High Tide Line have become filled as the result of the construction of man made structures. As this filling continued, many upland parties for various reasons gradually extended their fences beyond the 1921 Mean High Tide Line and placed improvements within the extended areas at varying distances from very slight encroachments to 135 feet in one instance. The upland owners have contended that they are entitled to ownership of all or a portion of the filled lands, and otherwise dispute the claims of the State and City. In 1978, the State Lands Commission began a resurvey of the 1921 Mean High Tide Line, tying it to current monuments of record so that its location is known with relation to existing conditions. This resurvey was recorded in 1980 in Book 90, Page 39 of Records of Survey in the Office of the County Recorder of Los Angeles County. Negotiations have been conducted and a settlement has been reached in People v, Mae West, et a1., which is acceptable to the State. This settlement provides as follows: 1. The Upland Owner will recognize the 1921 Mean High Tide Line, as resurveyed in 1978, as the permanent boundary separating tidelands from uplands, and shall relinquish any and all claims waterward of the agreed boundary. 2. The Upland owner and the State and City will execute a boundary agreement in the form of a joint quitcliam deed so establishing the boundary. 3. The Upland owner will be permitted to maintain the existing improvements waterward of the boundary line for a period of ten (10) years at a nominal rental rate as set forth in the State Lands Commission's regulations, specifically the California Administrative Code, Title II, Division 3, Article 2, Section 2005. These improvements consist of a wood fence and wood and stucco wall, which extend a maximum of 14 feet waterward of the 1921 Mean High Tide Line. 4. Upon the expiration of the initial ten (10) year period, the Upland owner shall have an option to lease the premises for an additional ten (10) year period at fair rental value. 5. All improvements waterward of the 1921 Mean High Tide Line shall be removed at the termination of the lease term. ALTERNATIVES Council may either approve or disapprove this settlement. Disapproval will mean continuation of the litigation which will be costly to both the City and the State and will further delay implementation of the Beach Plan. RECOMMENDATION In People v. Mae West, et al., the 10 year term and 10 year option is designed to gradually phase out the encroachments within a time frame which can accomodate the concerns not only of this party, but the other litigants as well; enable the City to proceed with the planning process for the beachy and provide an additional source of revenue for beach improvements if the option term is exercised. It is further recommended that the City Council authorize the negotiation of settlements and the execution of Boundary Line Agreements in similar related cases upon the same terms and conditions and in substantially the same form as the Boundary Line Agreement and Permit for Improvements and Lease Option Agreement before the City Council for approval in People v. Mae West, et al. These related cases are listed separately and attached hereto. Prepared by: Stephen Shane Stark, Acting City Attorney Susanne C. Wylie, Deputy Attorney General People v. Gaston, et a1. LASC Case No. WEC 42546 - 270 Palisades Beach Rd., Santa Monica People v. Nugent, et al. LASC Case No. WEC 42547 - 443 Palisades Beach Rd., Santa Monica People v. Palisades Beach Club, et a1. LASC Case No. WEC 42545 - 267 Palisades Beach Rd., Santa Monica People v. Waller, et al. LASC Case No. GVEC 42551 - 602 & 605 Palisades Beach Rd., Santa Monica People v. Zanuck, et a1. LASC Case No. [4EC 42550 - 546 Palisades Beach Rd., Santa Monica People v. Diener, et al. LASC Case No. WEC 46985 - 964 Palisades Beach Rd., Santa Monica People v. Lefcoe, et a1. LASC Case No. WEC .46987 - 972 Palisades Beach Rd., Santa Monica People v. California Canadian Bank, et al. LASC Case No. WEC 42547 - 522 Palisades Beach Rd., Santa Monica People v. P•4iller, et al. LASC Case No. GVEC 46986 - 966 Palisades Beach Rd., Santa Monica People v. Dlullin, et a1. LASC Case No. WEC 46989 - 1022 Palisades Beach Rd., Santa Monica People v. Carline, et al. LASC Case No. WEC 43432 - 918. Palisades Beach Rd., Santa P4onica People v. Harris, et a1. LASC Case No. WEC 43434 - 940 Palisades Beach Rd., Santa Monica People v. Julred, Inc., et al. LASC Case No. [4EC 43435 - 978 & 1018 Palisades Beach, Rd., Santa Monica People v. Perry, et al. LASC Case No. GVEC 43431 - 916 Palisades Beach Rd., Santa Monica People v. Rosenthal, et a1. LASC Case No. 40EC 43433 - 924 Palisades Beach Rd., Santa Monica People v. Camargue, Inc., et al. LASC Case No. G4EC 46237 - 549 Palisades Beach Rd., Santa Monica People v. Jones, et al. LASC Case No. WEC 46236 - 547 Palisades Beach Rd., Santa Monica 1. People v. Friedman, et al. LASC Case No. WEC 46238 - 607 Palisades Beach Rd., Santa Monica People v. Herson, et al. LASC Case No. WEC 46239 - 625 Palisades Beach Rd., Santa Monica People v. Grossman, et al. LASC Case No. WEC 462.41 - 702 Palisades Beach Rd., Santa Monica People v. Kanin, et al. LASC Case No. WEC 46240 - 653 Palisades Beach Rd., Santa Monica People v. Compania Exportadora de Productos Agricola, S.A., et al. LASC Case No. WEC 46242 - 703 Palisades Beach Rd., Santa Monica 2. DRAFT March 17, 1981 PROPOSED BOUNDARY LINE AGREEMENT SANTA MOLdICA STATE BEACH BOUNDARY LINE AGREEMENT--B.L.A. THIS BOUNDARY LINE AGREEMENT is made and entered into by and between the STATE OF CALIFORNIA, acting by and through the STATE LANDS COMMISSION; and the STATE OF CALIFORNIA, acting by and through the DEPARTMENT OF PARKS AND RECREATION; and the CITY OF SANTA MONICA, a municipal corporation; and hereinafter "Upland Parties." W I T N E S S E T H WHEREAS, the State of California (hereinafter referred to as "the State") acquired title to tidelands and submerged lands, by virtue of its sovereignty, upon its admission to the Union; WHEREAS, the California Legislature, pursuant to Statutes of 1917, Chapter 78, Page 90, approved April 10, 1917, granted the City of Santa Monica {hereinafter referred to as "the City") all of the State's right, title and interest in or to all of the State's tide and submerged lands within the then existing boundaries of the City, upon certain trusts and conditions; WHEREAS, the State Lands Commission is vested with all jurisdiction and authority remaining in the State as to tidelands and submerged lands granted to local agencies in trust, by the Legislature; 1. WHEREAS, the City Council of the City on July 25, 1921, adopted Ordinance No. 188 (Commissioners' Series), fixing and determining the line of mean high-tide of the Pacific Ocean within the City (hereinafter referred to as "the 1921 mean high- tide line"), and said ordinance was recorded in Book 431, Page 90, of Official Records, in the Office of the County Recorder of Los Angeles County; WHEREAS, said 1921 mean high-tide line is depicted on a plat entitled "Map Showing Line of Mean High Tide of Pacific Ocean in the City of Santa Monica, California," Drawing No. 0- 777, filed in File No. 412 in the Office of the County Recorder, County of Los Angeles, and recorded in Book 431, Page 90, of Official Records, in said County Recorder's Office; WHEREAS, the City and the Santa Monica Land Company, the then owner of that certain upland real property adjacent to and abutting the tidelands involved in this boundary line agreement, entered into an agreement in the form of a joint quitclaim deed utilizing said 1921 mean high-tide line as the common boundary line between said tidelands and said adjacent upland real property, and said quitclaim dated August 2, 1921, was recorded August 4, 1921, in Book 437, Page 118, of Official Records, in said County Recorder's Office; WHEREAS, the California Supreme Court in Muchenberger v. City of Santa Monica, 206 Cal. 635, decided March 8, 1929, affirmed the constitutionality of said boundary line agreement in the form of a joint quitclaim deed, thereby validating said 1921 2. mean high-tide line as fixed and determined by said Ordinance No. 188 (Commissioners' Series); WHEREAS, the State Lands Commission has completed a resurvey of said 1921 mean high-tide line tying it to current monuments of record so that its location is known with relation to existing conditions, said resurvey being recorded in Book 90, Page 39 et seq., of Records of Survey in the Office of the County Recorder of Los Angeles County; WHEREAS, the City, pursuant to Resolution No. 297 (City Council Series) adopted June 21, 1944, by the City Council, quitclaimed to the State all of the City's right, title and interest in and to certain tidelands previously granted in trust to the City, and said quitclaim deed dated June 21, 1949, was recorded January 19, 1950, in Book 31924, Page 250, of Official Records, in said County Recorder's Office; WHEREAS, the State Park Commission and the City entered into an operating agreement dated December 21, 1956, whereby the City agreed to develop, operate, maintain and control certain real properties, including said tidelands deeded from the City to the State by said deed dated June 21, 1949, for the purposes of the State Park System for a period of 25 years from December 21, 1956; WHEREAS, the Department of Natural Resources succeeded the State Park Commission by virtue of Statutes of 1959, Chapter 2164, Page 5257, Section 1; 3. WHEREAS, the Department of Parks and Recreation succeeded the Department of Natural Resources by virtue of Statutes of 1961, Chapter 2037, Pages 4248 and 4249, Section 16; WHEREAS, the tidelands involved in this boundary line agreement are included within that portion of the State Park System designated as Santa Monica State Beach, and are now owned by the State, and are now under the management and control of the City pursuant to said operating agreement dated December 21, 1956; WHEREAS, Upland Parties are the owners of that certain upland real property situated in the City of Santa Monica, County of Los Angeles, State of California, described in that deed dated and recorded in Book Page of Official Records in said County Recorder's Office; WHEREAS, said upland real property is adjacent to and abuts the tidelands involved in this boundary line agreement; WHEREAS, it is deemed necessary to reaffirm and to redescribe with greater specificity the physical location of said 1921 mean high-tide line of the Pacific Ocean as fixed and determined by said Ordinance No. 188 (Commissioners' Series); WHEREAS, by virtue of Public Resources Code section 6357, the State, acting by and through the State Lands Commission, may permanently establish the ordinary high-water mark of any tidelands of this State by agreement between the upland owners and the State; 4. i NOW, THEREFORE, it is agreed as follows: 1. In order to locate, describe and permanently establish the true and correct boundary line between the tidelands originally owned by the State by virtue of its sovereignty and presently vested in the State and City as set forth above, and said adjacent upland real property owned by it is agreed that ,said boundary line is described as follows: 2. It is the intent of the parties hereto that the aforedescribed boundary line shall be permanent and fixed, and that it shall not be subject to any change by reason of either erosion or accretion, or both, whether resulting from natural or artificial conditions. 3. hereby quitclaims, releases and remises all right, title and interest in and to those lands oceanward of the common boundary line set forth in Paragraph 1 hereinabove to the State and City as their respective interests are described above, such lands being more particularly described in Exhibit A attached hereto and by reference made a part hereof. 4. The State acting by and through the Department of Parks and Recreation and the State Lands Commission, and the City of Santa Monica, hereby quitclaim, release and remise all right, title and interest by virtue of sovereign ownership of tidelands and submerged lands in and to those lands landward of said common Boundary line to such land being more particularly described in Exhibit B attached hereto and by reference made a part hereof. 5. 5. Upland Parties shall be permitted to maintain certain encroachments now existing oceanward of the 1921 mean high tide line according to the terms and conditions set forth in the Agreement between the State and Upland Parties, which Agreement shall be executed and recorded upon the execution and recordation of this Boundary Line Agreement. A copy of said lease is attached hereto as Exhibit C. 6. This agreement shall become effective upon the occurrence of the following acts: A. The execution of this agreement by all of the parties listed below, and in the event any of such parties so listed voluntarily disposes of any interest affected by this agreement prior to the recordation of this agreement, the execution of this agreement by the successor in interest of such party in lieu of such party; and B. The recordation of this agreement, executed by all of the parties listed below, in said County Recorder's Office. 7. The effective date of this agreement shall be the date of the recordation as provided in paragraph 6 hereinabove. 8. Upon becoming effective, this agreement shall be binding upon and inure to the benefit of the parties hereto and their successors in interest, heirs and assigns. 9. It is expressly understood by all parties hereto that the provisions set forth in this agreement have been determined for purposes of compromise and settlement. The 6. matters agreed upon herein shall not constitute any admissions nor are they to be construed as an expression on the part of any party executing this agreement, except as between the parties hereto. Nor shall this agreement affect in any manner the right, title or interest of any party hereto, or any third party, in or to lands other than those described herein. 10. As used herein, whenever the context so requires, the neuter gender includes the masculine and the feminine, and the singular includes the plural, and vice versa. Defined terms are to have their defined meaning regardless of their grammatical form, number or tense of such terms. 11. All provisions of Paragraph 5 of this agreement shall be severable, separate and distinct from the other provisions of this agreement. Should any party, or his successor in interest, heir or assign fail to comply with any or all of those provisions in said Paragraph 5 after the effective date of this agreement, such failure shall in no way affect the consideration of this agreement or the validity or binding nature thereof. Nothing herein, however, shall affect or diminish the rights of any party hereto to enforce the provisions of said Paragraph 5 against any other party hereto, or his successor in interest, heir or assign. 12. This agreement may be executed in any number of counterparts and each executed counterpart shall have the same force and effect as an original and as if all of the parties to the aggregate counterparts had signed the same instrument. Any 7. signature page of this agreement may be detached from any counterpart of this agreement without impairing any signatures thereon, and may be attached to another counterpart of this agreement identical in form hereto but having attached to it one or more additional signature pages. In the execution of this agreement each party hereto shall furnish such acknowledgments and certifications as may be necessary to duly record, in the Office of the County Recorder, its execution hereof. IN WITNESS WHEREOF, each Party hereto has caused this agreement to be executed. 8. EXHIBIT C March 20, 1981 PERMIT FOR IMPROVEMENTS AND LEASE OPTION AGREEMENT A. THIS AGREEMENT is entered into this day of 1981, by and between the State of California acting by and through the State Lands Commission, hereinafter referred to as "State," and hereinafter referred to as "Upland Party." B. Upland Party improvements consisting of which extend approximately that certain line entitled 1978" as shown in Book 90 Recorder°s Office. has maintained certain existing a wood fence and wood-stucco wall 14 feet waterward, southwesterly of "1921 Mean High Tide Line Retraced if Surveys, Page 39, Los Angeles County C. The area waterward of said "1921 Mean High Tide Line" currently occupied by Upland Party and. within which said improvements are located, hereinafter "Premises," consists of approximately 602 square feet. Said Premises are more particulary described in Exhibit 1 attached hereto and incorporated herein by reference. D. Upland Party shall be permitted to maintain said existing improvements described in paragraph B above for a period of ten (10) years from the effective date of this agreement at a nominal rental rate, said rate being as set forth in the California Administrative Code, Title II, Division 3, Article 2, Section 2005 the amount being $30.00 per year. E. Upland Party shall pay to City of Santa Monica, or if City is no longer operator of the Santa Monica State Beach, then to such other public agency designated by the State Lands Commission, the amount of rent set forth in paragraph D above, which amount is due, owing and payable on the effective date of this agreement and on that same date yearly thereafter for a period of ten (10) years. F. Upland Party may paint and make routine repairs of such existing improvements, but shall not reconstruct or otherwise improve the same in any manner whatsoever. G. Upland Party shall not construct or maintain, either permanently or temporarily, any additional improvements waterward of the "1921 Mean High Tide Line Retraced 1978." H. Upland Party expressly agrees that the continued existence of said existing improvement[s] shall not give rise to any claim of prescriptive rights or any other right, title or 1. interest vis-a-vis the State, acting by and through the State Lands Commission, or the State, acting by and through the Department of Parks and Recreation, or the City, or any other public entity that may operate Santa Monica State Beach, or any combination thereof. I. Upon the expiration of the initial ten (10) year period, Upland Party shall have an exclusive option to lease said premises for an additional ten (10) year term at fair rental value, the amount of which shall be fixed and determined by the State Lands Commission. J. The State, shall give to Upland Party written notice no later than one hundred and eighty {180) days prior to the expiration of the initial ten (10) year term that said option must be exercised or be deemed terminated. Said notice shall include the rental rate for the option period. Failure of the State to give such notice shall extend the time during which Upland Party shall exercise said option by the equivalent number of days, provided that: 1. Notwithstanding that said option shall be exercised beyond the period specified in paragraph K of this agreement, said option term shall commence on the day following the expiration of the initial ten (10) year term and all payments by Upland Party shall be due and owing from that date. 2. Upland Party shall notify the City and the State, as specified in paragraph K of this agreement, as to Upland Party's current address for the purpose of receiving notice and any subsequent changes thereto. In the event the upland parcel is sold or otherwise transferred it shall be the responsibility of Upland Party to notify City and State of the change in ownership and failure to do so may be deemed a waiver of the right to exercise the option to lease. 3. Notice by the State to Upland Party shall be deemed given by depositing in the U.S. mail a notice correctly addressed to the last address provided by Upland Party, and a duplicate notice addressed to "Owner" at 514 Palisades Beach Road, Santa Monica, California. K. Upland Party shall exercise said option described in paragraph I above no later than one hundred and twenty (120) days prior to the expiration of the initial ten (10) year period which commences upon the effective date of this agreement. Notice of Upland Party's intent to exercise said option shall be deemed given by depositing said notice in the U.S. mail addressed to: 2. Director, Department of Recreation and Parks City of Santa Monica 1685 Main Street Santa Monica, California 90401 Executive Officer State Lands Commission 1807 13th Street Sacramento, California 95814 Director, Department of Parks and Recreation State of California 1416 Ninth Street, Sacramento, California 95814 L. Failure to provide said notice of intent to exercise option in the manner set forth in paragraph K above shall be considered a waiver of the right to exercise the option, and said option shall no longer be of any force or effect. M. Unless otherwise agreed by the parties, Upland Party shall pay the rental for the additional ten (10) year period on a yearly basis, with the first payment being due and payable on the date of commencement of the additional ten (10) year period, and yearly thereafter. N. In the event of failure of Upland Party to pay the consideration as provided herein within the time specified or in the event of breach of any of the terms or conditions contained herein, the State shall have the right to terminate this Agreement on giving to Upland Party a 30-day written notice to correct such default or breach and in the event Upland Party fails to do so, City or State shall have the right to reenter and occupy the premises and remove all property therefrom, provided however, that any reentry or repossession of the premises shall not operate to release Upland Party from any obligation under this Agreement. O. City and/or the State at all reasonable times shall have a right to enter said premises for the purpose of making any reasonable inspection to determine whether the terms and conditions of this Agreement are being fulfilled by Upland Party. P. Upland Party hereby assumes all risk of damage or injury or death of persons in or about said premises from any cause. Upland Party shall indemnify and hold harmless the City, the State of California, and their officers, agents and employees while acting as such, from any claim for such damage, injury or death. 3. 4. This Agreement shall be subject to approval of the State of California Department of Parks and Recreation. R. In the event City or the State is required to bring any action at law or equity to collect the payment of any consideration due hereunder or to enforce any of the terms or conditions of this Agreement, Upland Party shall reimburse the City and/or the State for such costs as may be incurred in the bringing of such action, including reasonable attorneys' fees. S. This Agreement may be terminated at any time by Upland Party by the removal of all improvements waterward of the '°1921 Mean High Tide Line Retraced 1978," by giving written notice to City and the State as provided in paragraph K above, and by payment of any consideration due and owing at the time of termination. T. Upon the termination of this Agreement, City and/or the State shall have the right to reenter the premises and remove and dispose of all property therefrom. Cost of removal and disposal of said property from the premises shall be borne by Upland Party upon tender of a bill by City and/or the State. U. This Agreement is binding upon and inures to the benefit of the heirs, successors in interest and assigns of the parties hereto. 4.