In a partially published opinion filed September 14, 2012, the Fifth District Court of Appeal revived a CEQA lawsuit the trial court had dismissed as time-barred on demurrer because it was filed 55 days after the City of Visaliafiled a notice of exemption (“NOE”).  The case – Coalition for Clean Air v. City of Visalia (VWR International, LLC) (Sept. 14, 2012) ____ Cal.App.4th ____, Case No. F062983 – may be viewed as “blurring” a “bright line” rule stated by the Supreme Court just two years ago, but it provides a valuable reminder to CEQA action respondents and real parties of the “t”’s that must be crossed and the “i”’s that must be dotted to ensure they can take advantage of CEQA’s short statute of limitations period (35 days) when relying on an exemption.  The  decision’s key points on this important issue include:

  • CEQA Guidelines section 15112(c) provides the 35-day statute of limitations for challenging project approvals determined to be exempt is triggered by the filing and posting of a Notice of Exemption “in compliance with section 15062[.]”  (Emph. added.)
  • In turn, the plain language of Guidelines section 15062 subdivisions (a) (“The notice shall be filed, if at all, after approval of the project.”) and (b) (“The notice shall not be filed with the county clerk or OPR until the project has been approved.”) is mandatory and “means that a notice of exemption filed before project approval does not comply with Guidelines section 15062.”
  • Therefore, according to the Court, “[i]t follows that filing a notice of exemption before project approval [is invalid and] does not begin the running of the 35-day limitations period set forth in [Public Resources Code ] section 21167, subdivision (d).” 
  • The Court harmonized its holding with the language of the Supreme Court in Stockton Citizens for Sensible Planning v. City of Stockton (2010) 48 Cal.4th 481, which stated in part that plaintiffs “may not, for purposes of the statute of limitations, go behind the agency’s declaration in an NOE that it has approved a project.  Instead, they must bring their action within 35 days after the NOE is filed and posted.”
  • According to the Fifth District, the Supreme Court’s above-quoted language (1) was dicta because Stockton Citizens involved a project approved months before (not after) the NOE was filed, and (2) was not intended to sanction the effectiveness of NOEs filed prior to actual project approval, since the Supreme Court’s opinion also (a) always used the term “facially valid” in the context of “a facially valid and properly filed NOE” (emph. added) and (b) stated:  “Nor does this mean that the agency may therefore file an NOE in advance of an actual project approval, then proceed unmolested to approve the project at its leisure, free of environmental challenges.”  (Stockton Citizens, 48Cal. 4th at 501, fn. 10.)
  • Because in the City of Visalia case the CEQA petitioner’s First Amended Petition (“FAP”) alleged the project approval (of a large VWR International, LLC distribution facility) occurred on November 8, 2010, five days after the November 3 filing of the NOE, and because these allegations were supported by two (apparently uncontradicted) City-prepared documents (a letter from the community development director and a city council meeting agenda) stating the approval occurred on November 8, the allegations were assumed true for purposes of demurrer and the FAP should not have been dismissed as time-barred at the pleading stage.

In reaching the above conclusions, the Court of Appeal was careful to clarify that the outcome of the statute of limitations issue was not finally determined, and indicated it would appear to depend on the resolution of an issue of historical fact that the trial court (as trier-of-fact) would ultimately decide, with the assistance of extra-record evidence if deemed appropriate in its discretion:  “Our decision to overrule the demurrer is not a final determination that the CEQA cause of action was, in fact, timely filed.  Instead, it is merely a determination that the dispute over whether the project received actual final approval before the notice of exemption was filed cannot be resolved against plaintiffs at the pleading stage of the proceedings.  Because the statute of limitations defense might be established subsequently in this litigation, we will remand for further proceedings in which the parties’ dispute regarding when the project actually was approved can be resolved.” 

The lessons for respondents and real parties here are:  (1) make sure the administrative record is clean and clear on the date of final project approval; (2) don’t file an NOE until after project approval because a premature NOE is void; and (3) when in doubt as to the validity of an NOE, consider filing another NOE because if the first one is void, a 180-day statute from notice of project approval will apply, leaving the project vulnerable to CEQA challenges for 6 months rather than 35 days.