Oral arguments were heard before the 9th Circuit Court of Appeals on March 11 in Southern California, one more step in the lawsuit filed by the city of Santa Monica against the FAA on Oct. 31, 2013. The lawsuit seeks to clarify the city’s title to the airport property and also seeks “relief from the claim by FAA that the city must operate the Santa Monica Airport in perpetuity,” which was agreed to after the government relinquished its lease on the airport back to the city in 1948. The city of Santa Monica has been trying to close its airport for many years and faces stiff opposition from the FAA.
During the hearing, attorney Deanne Maynard, a partner with Morrison & Foerster, argued on behalf of the city that the 1948 Instrument of Transfer that returned the airport land from the government back to the city did not apply to the land under the airport. She asserted, “Title of the land has always been held by the city.” That Instrument of Transfer essentially required the city to operate the airport in perpetuity in exchange for the reversion of the government’s interest in the property back to the city.
However, Maynard argued, “The covenant applied only to the property that the United States actually transferred to the city. And that property no longer has any meaningful value and…its useful life is expired, and so the covenants no longer have any force.” Central to this argument is that the city believes the property transferred was the improvements on the airport land, not the land itself. “The property that transferred were buildings, facilities, runways built during World War II…over 60 years ago, that no longer have useful life,” she said.
Maynard’s second argument, and the main reason for the appeal, is that the District Court originally dismissed the city’s lawsuit because it was not filed in a timely manner, and that the statute of limitations had expired. Maynard argued that the timing should have started in 2008, following a determination by the FAA that the city had to continue operating the land as an airport forever, not in 1948 when the land was transferred back to the city.
Attorney Alisa Klein, arguing for the FAA’s position, explained, “Basically what was transferred [in 1948] at the request of the city was a substantially improved airport, more than a million dollars of improvements, for no payment by the city, and the consideration was the acceptance of certain restrictive covenants that explicitly run with the land. In essence, the commitment that this land will be used for airport purposes and ‘run with the land’ means in perpetuity.”