Beware! Claim Just Compensation and the Government May SLAPP You!

California law contains an anti-SLAPP statute that allows the court to dismiss a case and award attorneys’ fees to the defendants if they are being sued based on a legitimate exercise of their constitutional rights or other “protected activity.”  Governmental agencies also have the right to seek such a dismissal with attorneys’ fees if they are sued.  Caltrans has been experimenting in using this law against property owners who sue for Just Compensation.  Two examples are revealing.

            First, Caltrans successfully moved to dismiss an inverse condemnation complaint filed by a property owner which claimed that, in a prior lawsuit that Caltrans had won, Caltrans had taken a position on the facts that it knew to be false.  The court awarded Caltrans attorney’s fees under the anti-SLAPP statute.  The property owner appealed the dismissal, but failed to appeal the award of attorney’s fees.  Accordingly, the court in Sohal v. People ex rel. Dept. of Transportation (an unpublished decision filed on April 29, 2014) held that the property owner had abandoned any appeal rights concerning the attorney’s fees.  The court went on to uphold the dismissal under the anti-SLAPP statute, on the grounds that Caltrans’ actions in the prior lawsuit were protected activity.

            Second, in a lawsuit handled by this author, a property owner sued Caltrans in inverse condemnation seeking pre-condemnation damages under the California Supreme Court’s decision in Klopping v. City of Whittier.  Caltrans retaliated by filing a motion to dismiss under the anti-SLAPP statute, claiming that its pre-condemnation actions in contacting tenants and creating a cloud of condemnation were “protected activity.”  The trial court agreed, awarding Caltrans attorney’s fees.  On appeal, however, the judgment was reversed in its entirety in an unpublished opinion which held that the property owner had demonstrated that he was likely to prevail on his inverse condemnation claim.  The property owner, then, filed a peremptory challenge against the trial judge who had originally ruled in Caltrans’ favor, and the case was assigned to a new trial judge.  The new trial judge then awarded the property owner attorney’s fees, instead of Caltrans.  The case ultimately settled with Caltrans paying $1.1 million plus the attorney’s fees awarded to the property owner.  Caltrans’ attempt to SLAPP back at the property owner backfired.

            In short, a property owner seeking to assert his or her own constitutional right to Just Compensation may be SLAPPed by government agencies in retaliation; and may have to fight to protect those rights in the trial court and, if necessary, on appeal.  If you have any questions, call Callanan, Rogers & Dzida, LLP, for a free consultation.

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