Settlement Reached in Dana Point Headlands Litigation

At the June 6th City Council meeting, it was announced that a settlement had been reached between the City of Dana Point and the Headland’s Reserve LLC. This lawsuit is a result of previous litigation with the California Coastal Commission. All this litigation eventually cost the city over $500,000 in legal fees and penalties.

The California Coastal Commission litigation began in 2010 when the City Council enacted a Nuisance Abatement Ordinance to install gates at several beach access walkways through the Headlands development. The California Coastal Commission had prohibited the installation of gates. The Ordinance was intended to circumvent the California Coastal Commission’s jurisdiction prohibiting the gates. It was a risky maneuver probably taken with the understanding that the Headland’s Reserve LLC would indemnify the City for the legal costs.

In September, 2015, a final ruling by Judge Randa Trapp of the Superior Court of the State of California against Dana Point stated that the Ordinance was a pretense to avoid Coastal Commission regulations with no basis in fact being established.

In 2016, the City of Dana Point sued the Headlands Reserve LLC for reimbursement of legal costs the City had incurred regarding its California Coastal Commission litigation. The Headlands Reserve asserted that it had been overbilled and would not reimburse them. Apparently, there was a dispute over the hourly rate charged by Rutan and Tucker for its legal services since 2010! Both parties subsequently agreed to settle through mitigation.

Points of Concern

Following is a copy of Judge Randa Trapp’s Statement of Decision dated September 17, 2015. The complete decision contains conclusions that should be of major concern. These include:

  • The City’s enactment of the Nuisance Abatement Ordinance on March 22, 2010 was a pretext for avoiding the requirement of the local coastal program. “Court further finds that there was not, in fact, a nuisance or prospective nuisance at the time that a Nuisance Abatement Ordinance was enacted.”
  • The City Council failed to look behind the numbers, “whether intentional or unintentional”, further evidence that the action was a pretext.
  • There was no rational basis for the Council’s action.

Regarding Dana Point’s legal Counsel’s representation in enacting the Nuisance Abatement Ordinance, the footnote on page 11 states:

“Further evidence of staff’s apparent concession that there was no known nuisance at the time was the insistence in the City’s closing argument that the court must find that pretext was the “sole” reason for the enactment of the Nuisance Abatement Ordinance. Additionally, Counsel admitted that the City was “fed up” with the Commission and took advantage of a provision where they did not have to work with the Commission. He further conceded that the urgency aspect of the Ordinance was because of the threat of litigation by the Commission. Counsel also made similar comments at the City Council meeting set to enact the Nuisance Abatement Ordinance. He informed the Council that the Commission had threatened to sue and that enacting the ordinance would avoid unnecessary litigation. (Exh. 8, pg. 4 City Council meeting transcript)”.

Click here to see the full, original court decision: Dana-Point-vs-Coastal-Commission


City, Headlands Reserve Enter Settlement Agreement
June 7, 2017
By Kristina Pritchett

After months of litigation, the city of Dana Point and the Headlands Reserve, LLC have entered a settlement agreement.

The settlement dismisses all… [read more]

Leave a Comment