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Fate of City Claim Over Santa Monica Airport in Hands of Appeals Court
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Kutcher & Kozal, LLP

Convention and Visitors Bureau Santa Monica

By Hector Gonzalez
Special to The Lookout

March 21, 2016 -- Whether the City ever gets its day in court in its David versus Goliath legal battle against the United States of America over Santa Monica Airport is now in the hands of the three judges of the 9th Circuit Court of Appeals.

The Pasadena court, which heard arguments from attorneys on both sides in the dispute earlier this month, now is deciding whether Santa Monica's time to sue has expired.

Attorney Deanne E. Maynard, representing the City, told the judges during a hearing March 11 that a U.S. District Court was wrong on two key points when it applied a federal 12-year statute of limitations to the City's 2013 lawsuit seeking local control over the airport property ("City Hall Sues FAA Over Future of Santa Monica Airport," November 1, 2013).

First, she said, Santa Monica had no way of knowing in 1948 that the agreement formalizing the federal goverment's lease on the airport property – called an “instrument of tranfer” – could some day erupt in a legal dispute over the property and the need for Santa Monica to sue the government to re-establish title to property it originally owned.

Although the City agreed in 1948 to operate the airport “in perpetuity,” the transfer document doesn't even hint that the federal government might someday lay claim to title of the property if the city failed to live up to its commitment, she said.

“All it says is that the United States can revert the property interests it transfers to the City if it determines there's a violation of the terms of that agreement,” Maynard said.

“There's no way that the language of that agreement put the City on notice in 1948 that it needed to challenge the claim the United States is making now.”

The first time the U.S. government invoked the “reverter” clause in the transfer document was in 2008, when the Federal Aviation Administration in a “show cause notice” informed the City that “if you don't keep operating the airport, we're going to take the land,” Maynard told the court.

Santa Monica contends the clock on the 12-year period in which to sue the federal government should have started in 2008 when the FAA issued the show cause notice, she said.

“In any event, the United States abandoned any such claim in the 1984 settlement agreement,” which came after a City resolution in 1981 announced its intent to close the airport when feasible," Maynard said.

That settlement resulted in “a plan by which the City would operate the airport until July 1, 2015,” said Maynard.

The plan was supported in writing by an FAA director's decision that “found as fact that after July 1, 2015, operation of the land was a local land-use matter,” Maynard said.

Judge Richard Paez said the transfer document itself “could be interpreted to say the City long ago had notice of the government's position, or that the reverter clause itself put the City on notice.”

Maynard said the transfer agreement referred only to the title of property the FAA was transfering to the City in 1948, but “the title of the land was not transferred.”

“The title of the land has always been with the City,” she said.

Santa Monica has known since 1948 that the federal government has had a keen interest in operating the property as an airport and that a legal “cloud” has existed over the property's title since then, said Alicia Klein, an attorney for the United States.

Klein sought to focus the argument on the issue of the statute of limitations and not on the merits of the City's lawsuit.

But Judge Jacqueline Nguyen asked her how the United States can claim the right “to reposs the land in perpetuity when it didn't own the land in the first place?”

“I will answer your honor's question, but I should emphasis I want to distinguish the notice issue to this response, which pertains to the merits, not the notice,” said Klien.

She said the FAA transferred more than $1 million of improvements to the City “with no payment by the City,” said Klein ("FAA Rules Santa Monica Airport Must Stay Open," December 7, 2015).

“The consideration was the acceptance of certain restrictive convenants that run with the land, and that the land will be used for airport purposes. 'Run with the land' means in perpetuity,” she said.

Maynard is hoping the court does indeed take the merits of the City's lawsuit into consideration in rendering its ruling on the district court's dismissal.

“To the extent that the notice question is instricably intertwined with the merits, that too, is a basis” to send the case back to the district court, said Maynard.

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