City Of Ceres: California Appeals Court CEQA Decision Complicates Whether Agencies' Communications With Developers Are Privileged

Elizabeth "Betsy" Lake is a Partner and Spencer B. Potter is an Associate both are in our San Francisco office.

Introduction

On July 8, 2013, the Fifth District of the California Court of Appeal issued Citizens for Ceres v. Super. Ct. of Stanislaus County (Case No. F065690 (Cal. Ct. App. 5th, July 8, 2013)) (Ceres), a perplexing opinion holding that pre-project approval communications between the agency conducting California Environmental Quality Act (CEQA) review and the project applicant are not protected by the attorney-client privilege. Ceres disagrees with California Oak Foundation v. County of Tehama (Tehama), 174 Cal.App.4th 1217 (2009), an important 2009 Third District decision that held that communications between agency and project applicant lawyers were protected under the attorney-client privilege's "common interest doctrine." The Ceres case expressly disagrees with Tehama to the extent the Third District opinion has been interpreted to be applied the attorney-client privilege prior to project approval.

We believe that Ceres is wrongly decided and presents an appellate court split of opinion. The case presents a cartoonish caricature of scheming developers and hapless lead agencies, overreaches based on the facts and mischaracterizes CEQA's informational purpose by conflating a lead agency staff's obligation to create a legally sufficient environmental impact report (EIR) with the agency's decision-maker (often elected officials) role in deciding whether to approve or disapprove a project and whether to accept, reject or modify mitigation measures included in staff-prepared (or applicant-prepared) CEQA documents.

We believe that given this appellate district split, under California rules of stare decisis, superior courts and other appellate courts must now decide which case to follow. See Auto Equity Sales, Inc. v. Superior Court, 57 Cal. 2d 450, 456 (1962) ("where there is more than one appellate court decision, and such appellate decisions are in conflict," the superior court "can and must make a choice between the conflicting decisions"). Until Ceres is depublished or overturned by the California Supreme Court, lead agencies and project proponents should be aware of its possible impact, particularly within the Fifth District, where the superior courts may be more likely to follow this decision. See McCallum v. McCallum, 190 Cal.App.3d 308, 315 (1987) (noting that notwithstanding the fact that trial courts can choose among conflicting appellate decisions, "a superior court ordinarily will follow an appellate opinion emanating from its own district even though it is not bound to do so"). Given the Ceres opinion's dubious reasoning on multiple fronts, we believe public policy supports the use of the common interest doctrine in preparing CEQA documents and that the Tehama opinion should continue to be followed.

The Common Interest Doctrine and theTehama Case

The attorney-client privilege and work product...