The Regents of the U. of Cal. v. City of Santa Cruz CA6

Filed 11/21/24 The Regents of the U. of Cal. v. City of Santa Cruz CA6 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SIXTH APPELLATE DISTRICT

THE REGENTS OF THE UNIVERSITY H050528 OF CALIFORNIA, (Santa Cruz County Super. Ct. No. 20CV02152) Plaintiff and Appellant,

v.

CITY OF SANTA CRUZ,

Defendant and Respondent.

I. INTRODUCTION This appeal arises from a dispute between appellant the Regents of the University of California (Regents) and respondent the City of Santa Cruz (City) regarding the City’s obligation to supply municipal water to the University of California, Santa Cruz (UC Santa Cruz) under the terms of two agreements that the parties entered into in 1962 and 1965 after the Santa Cruz area was selected as the location for a new University of California campus. By 2005 the City had become concerned about the growth of the UC Santa Cruz campus and a controversy arose regarding whether the City was obligated to supply water for new campus development, and, in particular, those parts of the campus that were outside City jurisdiction. After the City failed to confirm that it would supply water under the terms of the parties’ agreements, the Regents filed an action against the City seeking declaratory relief and specific performance of City’s water service obligations.

The parties each filed a motion for summary judgment, or in the alternative, summary adjudication of the causes of action for declaratory relief and breach of contract—specific performance contending that their interpretation of the extent of the City’s water service obligations under the parties’ 1962 and 1965 agreements was correct.1 The trial court denied the Regents’ motion and granted the City’s motion, ruling that “the Agreements cannot reasonably be interpreted as contractually obligating the City to provide water for all future development within the Campus boundary, including the new development planned in the North Campus.” The trial court also ruled that the City could not extend water service to the North Campus absent annexation of that part of the campus by the City or approval of the extension of extraterritorial services by the Santa Cruz Local Agency Formation Commission (LAFCO), and LAFCO was the arbiter of whether the Government Code section 56133, subdivision (e)(4) exemption for extended services provided before 2001 applied.2 The trial court therefore determined that LAFCO was an indispensable party and the Regents’ failure to join LAFCO as a party was fatal to the cause of action for declaratory relief. The September 30, 2022 judgment dismissed the Regents’ second amended complaint with prejudice and entered judgment for the City. On appeal, the Regents contend that the trial court erred and they are entitled to declaratory relief and specific performance of the City’s water service obligations under the Regents’ interpretation of the parties’ agreements. The Regents also argue that the trial court erred in ruling that