Bolsa Chica Development Foes Win Major Victory : Court Revives Amigos’ Suit, OKs New Claims

Times Staff Writer

Opponents of the planned development of 1,200 acres of Orange County’s Bolsa Chica wetlands claimed a major victory Friday after a judge’s decision earlier in the week revived a 10-year-old lawsuit challenging the project.

The decision in the complicated case gives Amigos de Bolsa Chica, a conservationist group, the right to pursue a lawsuit filed in 1979 that challenged the development and to add new claims. Orange County Superior Court Commissioner Ronald L. Bauer rejected a request by the developer, Signal Landmark Inc., for dismissal of the conservationists’ case.

“We are delighted,” said Victor Leipzig, president of the 1,000-member Amigos, long foes of development of the ecologically sensitive wetlands. “Our motion was approved, and theirs was denied.”

Bauer’s decision revived a lawsuit that an appellate court ruled in 1984 had not been filed within the time allowed by the statute of limitations. In that lawsuit, the Amigos contended that a 1973 deal between the two primary landowners in the area, the State of California and Signal Landmark, was illegal.


$1-Billion Development

The agreement provided for the state to receive 300 acres near the intersection of Warner Avenue and Pacific Coast Highway that now are a state ecological reserve. Signal got hundreds of acres that, along with land it already owned, are the planned site of a $1-billion residential development and marina.

If the 1973 land swap is found to have been illegal, the development plans would be seriously jeopardized.

Signal attorney Russell G. Behrens played down the significance of Bauer’s decision. Signal is to go back to the Coastal Commission--which approved its land-use plans in 1985--for final approval this summer, Behrens said.


“This lawsuit does not, as far as I am concerned, impair the progress of the project,” he declared.

But California Assistant Atty. Gen. Gregory Taylor, who has been involved in Bolsa Chica legal questions for 20 years, said Bauer’s decision assures a long court battle. Taylor, who as the state’s attorney is arguing that the deal with Signal should be upheld, noted that Signal’s development planning has continued despite the lawsuit.

“Basically, the people who are going ahead with the planning assume we will ultimately be successful,” Taylor said. “But it’s frustrating. We have had three rulings by the courts that we were correct, and yet we can’t get any of them final.”

Twice after the lawsuit was filed, Superior Court judges rejected the Amigos’ challenge, ruling that the group’s lawsuit had been filed too late. A state Court of Appeal, in an opinion written by Justice Marcus W. Kaufman, who now is on the California Supreme Court, concurred.

But in 1984, the state Supreme Court agreed to consider the Amigos’ appeal, vacating the appellate court ruling. Then last year, after Chief Justice Malcolm M. Lucas took office, the case was transferred back to Orange County without any further ruling.

Signal then asked that the lawsuit be dismissed, but Bauer, in a four-line ruling dated Monday, stated “there is simply no basis for granting (Signal’s) motion.”

The conservationists contend that state government is prohibited by the California Constitution from transferring any tidelands--land that lies between mean high and low tides--into private ownership.

Signal and the attorney general’s office contend that the 1973 transfer was perfectly legal, proper and sensible. State law allows for minor adjustments in legal title to tidelands, and the Bolsa Chica deal was exactly that, they argue.


The legal doctrine that tidelands, which became state property when California was admitted to the union, are inalienable public land was central to another environmentalist court challenge to coastal development.

Last year, the Sierra Club claimed that a similar land swap between the state and the Irvine Co. involving Upper Newport Bay was illegal. The transfer was upheld by a judge after a long trial.

Involves Oil Rights

The Bolsa Chica case also involves rights to oil that has been pumped out of the area for years by Signal.

“We are asking basically to have the 1973 conveyances set aside and for an accounting of the oil revenues, which likely will total in the hundreds of millions of dollars, which we say were wrongfully diverted from state coffers to the private defendants,” said Ken Martin, one of the lawyers representing the Amigos.

Bauer’s ruling also means that the Amigos will have a chance to attempt to prove that the land deal was fraudulent.

“We will allege that there was concealment from the public as to the exact terms of the trade,” said Linda Martin, another Amigos lawyer. “The public couldn’t know what a bad deal it was.”

Martin said that she and a law partner, Hal Bohner, and her brother, Ken Martin, have represented the Amigos on a “discounted” basis, charging 40 to 50% of their normal fees.


In the 1970s, Signal built several housing tracts in the interior of its Bolsa Chica property, but there has been little development since then.

The 5,700-unit housing development and marina that Signal hopes to place on the Bolsa Chica property would be expedited by a bill pending in the Legislature. The measure would create a public agency, dominated by Signal, with the power to issue building permits and bonds.

Working for Legislation

Signal is working in Sacramento this year to try to win approval for the legislation, which is considered critical to the ultimate success of the project.

In Washington, a measure passed two years ago provided innovative financing for a proposed $90-million navigable ocean channel for the area.

Despite the Amigos’ objections to the Signal development plans and its agreement with the state, Taylor defends the 1973 land swap, saying it preserved key wetlands along Pacific Coast Highway.

“If we had not been successful in our transaction in 1973,” Taylor said, “Signal’s first development would have gone in along Pacific Coast Highway. And I can tell you that at the corner of PCH and Warner, there would have been a (high-rise) Holiday Inn with a gas station.”

but that is not enough to satisfy Leipzig, a biology professor at Cypress College.

“We’d like to see the entire wetlands area preserved,” he said. “It’s in the best interest of the wildlife, and in the best interests of the whole community.”