Bay Drive foes lose in appeals court

Who knows when the fat lady will sing in Three Arch Bay?

The Appeals Court recently upheld an Orange County Superior Court ruling that the City Council had acted within its rights in approving the construction of a home on Bay Drive, 10 years after the project was first approved. However, Kathleen and Craig Miller, and Lesley and Sid Danenhauer haven’t given up their long, drawn-out quest to prevent construction of the project, before and after the council’s final approval in 2006.

“We consider the court decision a setback, but certainly, not an end to our opposition to misrepresentation, fraud and forgery,” Sid Danenhauer said.

The Millers and the Danenhauers have filed a new action in the county Superior Court.

“In any reasonable world, the Appeals Court decision would have ended this agonizingly long dispute,” said attorney Eugene Gratz, who represents Valerie and Charles Griswold, owner of the Bay Drive parcel.

The Griswolds’ proposed 5,200-square-foot home was approved by the Laguna Beach Design Review Board in 1998, and the project has mired in legal or bureaucratic limbo, not to mention a landslide, for almost a decade.

“Whatever the appellants have paid in attorney’s fees, they have had an unencumbered white water view over an empty lot, worth millions, while the Griswolds have been thwarted in their efforts to build their home,” Gratz said.

“The Griswolds are responsible for some of the delays, but the home would have been built in 2005 if the opponents had not begun fighting the construction,” he said.

The Millers and the Danenhauers have failed to make their case with the council or in court, but in addition to the new action, they also have the right to ask the Appeals Court for a rehearing or to petition the California Supreme Court for a hearing, Gratz said.

While an appeal hearing must be granted if requested, neither a rehearing nor Supreme Court hearing is mandatory.

Appeals are costly.

According to the chronology in the recent appeal of the Superior Court ruling and confirmed by Gratz, the Danenhauers threatened to appeal the design board’s 1998 decision, but withdrew their threat when the Griswolds agreed to make changes to the plan, which also required a California Coastal Commission development permit.

The commission approved a 5,078-square-foot project, subject to certain conditions. The Griswolds sought and obtained three-year extensions of the approvals and permit.

A building permit was issued in June 2003. It was appealed to the council by the Millers and Danenhauers. The appeal was put on hold when city staff discovered that the coastal commission had not issued a development permit, which invalidated the building permit and notified the Griswolds that the design review approval consequently had expired.

In June 2004, the staff revocation of the building permit was overturned by the council, which reinstated the design review board approval, with conditions that included a restriction on building activity until the costal permit was issued.

The development permit was issued in October 2004. To comply with requirements in the permit, the Griswolds applied to the board for modifications to the originally approved design. The board approved in January 2005 only the modifications required by the commission.

An appeal of the board’s approval was filed with the city by the Millers and Danenhauers, alleging that misrepresentations had been made to the council concerning the lot’s grade change, building height calculations, project plans and staking.

In March of 2005, the council sent the project back to the board, failing to act on a request by the project opponents for revocation of the approval, but leaving the door open for such a hearing in the future.

The Griswolds filed a lawsuit against the city, and it became moot when city approved the modified design in December of 2006, rather than revoking the original approval.

Danenhauer said the council received more than 100 letters from residents asking for revocation if the council found misrepresentation, which he claimed was documented.

“All of us were baffled by the council’s decision,” Danenhauer said.

The project opponents then challenged the decision in Superior Court, claiming the City Council did not have jurisdiction to approve the modified project.

City Attorney Philip Kohn argued in Superior Cand Appeals courts that the appellants had not exhausted the required administrative levels because their argument in court had not been raised during the revocation hearing. The trial court judge and three Appeal Court Justices agreed.

In all, Gratz estimates that probably 15 to 20 hearings have been held in court on the Bay Drive project and a similar number at cumulative hearings before the Design Review Board, the City Council and the Coastal Commission.

And it’s not over yet.