Merkoh Associates, LLC v. Los Angeles Unified School District

Filed 3/22/16 CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION EIGHT

MERKOH ASSOCIATES, LLC, B265178

Plaintiff and Appellant, (Los Angeles County Super. Ct. No. BC555533) v.

LOS ANGELES UNIFIED SCHOOL DISTRICT,

Defendant and Respondent.

APPEAL from a judgment of the Superior Court of Los Angeles County, William Highberger, Judge. Affirmed.

Steve A. Hoffman for Plaintiff and Appellant.

David Holmquist, Gregory L. McNair, Carl J. Piper and Sung Yon Lee for Defendant and Respondent.

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The only issue on appeal is whether Civil Code section 3287 (section 3287), which provides for interest when damages are awarded, applies specifically to interest on a refund for a development fee paid to the Los Angeles Unified School District. We conclude that section 3287 does not apply because Government Code section 66020, subdivision (e) more specifically sets forth the interest available on the development fee refund. The substance of Government Code section 66020 (section 66020) was enacted in 1984 as part of the Mitigation Fee Act. (Sterling Park, L.P. v. City of Palo Alto (2013) 57 Cal.4th 1193, 1200 (Sterling Park), citing former Gov. Code, § 66499.37.) “„Prior to the enactment of this statute, a developer could not challenge the validity of fees imposed on a residential development without refusing to pay them. [Citation.] Since payment is a condition of obtaining the building permit, a challenge meant that the developer would be forced to abandon the project. The bill was drafted to correct this situation. It provided a procedure whereby a developer could pay the fees under protest, obtain the building permit, and proceed with the project while pursuing an action to challenge the fees. If the action were successful, the fees would be refunded with interest.‟” (Ibid.) Section 66020, subdivision (a) allows any party to protest the imposition of development fees if it followed the procedures set forth in the statute. Section 66020, subdivision (d)(2) provides in pertinent part: “Any party who files a protest pursuant to subdivision (a) may file an action to attack, review, set aside, void, or annul the imposition of the fees, dedications, reservations, or other exactions imposed on a development project by a local agency within 180 days after the delivery of the notice. Thereafter, notwithstanding any other law to the contrary, all persons are barred from any action or proceeding or any defense of invalidity or unreasonableness of the imposition.” A successful plaintiff is entitled to a refund of “the unlawful portion of the payment, with interest at the rate of 8 percent per annum.” (§ 66020, subd. (e).) Merkoh Associates, LLC (appellant) sought interest under Civil Code section 3287 (rather than under Gov. Code, § 66020) from the time of its application to Los Angeles Unified School District for a refund to the time of the refund. The trial court