City-County Subdivision Issues Heard

A six-year struggle over some of south Orange County’s choicest hilltop land went to trial Thursday, pitting Laguna Beach against Orange County and a major developer.

At stake in the Superior Court trial is a small plot of land measuring less than an acre at the end of Alta Laguna Boulevard. But the land, which is a city mini-park, is potentially worth at least $20 million: It is crucial to developing a subdivision in county territory known as Laguna Heights.

Carma-Sandling Group, an Irvine-based developer, wants to build 108 houses on 28 acres of unincorporated land that lies just beyond the park atop The Knoll, a hilltop that affords a panoramic view of inland canyons, coastal cities and the ocean.

But Alta Laguna is the only street that comes close to Carma-Sandling’s property. Without the 60-foot-by-82-foot plot, Carma-Sandling’s acres overlooking Laguna Beach are landlocked and far away from any roads.

‘Misuse and Abuse’

The trial that began Thursday is an unusual political tug-of-war because it is between two levels of local government. The bitterness of the spat was apparent on opening day, with Philip D. Kohn, a private attorney representing Laguna Beach, accusing the county of “misuse and abuse” of its power of eminent domain. His opponent--William L. Owen, representing the county--in turn attacked the city for its “sham” maneuvers aimed only at blocking development.

If Orange County wins, it will condemn the tiny parcel. Then, in exchange for 438 acres--more than 90% of Carma-Sandling’s entire 471-acre parcel--the county will dedicate the plot as a public road. Carma-Sandling will have street access to the 33 acres it retains for a subdivision. And the county will have a major chunk of land to add to its planned Aliso Creek/Woods Canyon Regional park.

The chunk is important because the county can exercise its right of eminent domain only if it is taking the parcel for a public use.

In opening arguments, Owen told Judge Henry T. Moore that the county will develop “a road leading to two neighborhood parks and 438 acres of additional . . . space with a nature area” and miles of public trails for hiking.

Owen said the county has long planned to build two mini-parks--one six-tenths of an acre and the other 1.95 acres--within the 5,300-acre Aliso Creek/Woods Canyon Regional Park, on land that will be dedicated by the developer.

Laguna Beach is concerned that if Alta Laguna is extended to the new development, increased traffic from the homes there would overburden Park Avenue, the most direct route from the area of The Knoll to Coast Highway. For years Laguna Beach has said it would not extend Alta Laguna Boulevard the necessary few hundred feet unless Carma-Sandling agreed to build just 70 houses.

“Every additional car means that much more congestion,” said Kohn, the city’s attorney.

Kohn told Judge Moore that the condemnation suit “gives every appearance of providing a private benefit to a developer. . . . The county routinely approves developments without thinking through the impact and leaving someone else to figure out how to deal with it. This time, Laguna Beach is in the position to say: ‘This time, you’re not going to do it.’ ”

Furthermore, according to Kohn, Laguna Beach itself has long planned to convert the existing mini-park into a 14-acre Alta Laguna Community Park.

The dispute dates back to 1980, one year after Carma-Sandling paid $1.96 million for the property, which is bounded on one side by sheer cliffs. The developer won initial approval from the county to build 110 luxury homes. But while the county’s General Plan for the area permits 110 homes, Laguna Beach’s more restrictive one does not.

In November, 1983--three years after Carma-Sandling first asked for approval of 110 lots--the city agreed to 70. “You just can’t make the rate of return work” with that number, Sanders said.

Over the next three years, both sides filed about a dozen lawsuits, two of which are pending before the state Court of Appeal.

If the impasse is not resolved in Carma-Sandling’s favor in this trial, the developer has a backup lawsuit pending--also in Orange County Superior Court--to seek an “easement by necessity” over the city’s mini-park.

The dispute may never reach that stage, however.

Much of Thursday’s session was taken up by Laguna Beach’s motion to end the trial immediately. Kohn argued that the county violated state law by not getting Laguna Beach’s consent before designating city-owned land as a county road. Furthermore, he argued, state law requires the county to first get a city report that the proposed road meets the city’s General Plan, which it does not do, he said.

Judge Moore is scheduled to rule on the motion when the trial resumes Aug. 24.