On the docket: Santa Monica Airport (SMO)

Clover Field, circa 1924. Photo courtesy of USC Libraries - California Historical Society Collection.

Clover Field, circa 1924.
Photo courtesy of USC Libraries – California Historical Society Collection.

Previously in these pages, we’ve related much of the history surrounding the airport that began life around 1917 as a simple grass runway. Renamed Clover Field by the U.S. Army in 1922, its struggle with the residents of Santa Monica has been nearly continuous ever since.

The protracted legal battle continues to play out, with the beginning of arguments before the 9th Circuit Court of Appeals last week in Pasadena, CA.

The City has been trying to close the airport for years, but since 1948 has been accepting federal grant funds that were used for maintenance and improvements. The most recent grant of $1.6 million was accepted in 1994, and since terms of these grants typically run 20 years the City contends its obligations expired in June 2014.

However, in 2003 the City accepted an additional $240,600 for improvements, but claims these funds were simply an extension of the original grant and did not trigger a renewal of terms.

The City has been making life difficult for those flying in and out of SMO as well as aircraft owners and tenants on the field. Shortening lease terms, taking charge of fuel sales, more stringent rules concerning noise and air pollution abatement, and so on, have induced more than one tenant to pull up stakes and abandon the field.

After complaints filed by tenants, owners, the National Business Aviation Association (NBAA), and the Aircraft Owners and Pilots Association (AOPA), the FAA ruled in December 2015 that the airport must remain open until 2023.

Santa Monica Airport

Santa Monica Airport

That ruling, along with a February 2014 ruling by District Court Judge John Walter that dismissed the City’s lawsuit against the FAA, set in motion a series of appeals, the first of which has now begun in Pasadena.

This particular appeal seeks to overturn Judge Walter’s ruling by arguing he made an error in siding with the FAA. Judge Walter’s ruling concluded that “the City knew, or should have known, that the U.S. claimed an interest in the airport property as early as 1948.”

The original transfer documents, like all similar agreements between FAA and airport host cities following World War Two, show that the City signed off in writing that the property should keep operating as an airport and that “no property transferred by this instrument shall be used, sold, salvaged, or disposed of by the City for other than airport purposes,” without FAA approval.

Such agreements provided for continued federal grant funding to maintain and improve airports as long as they were operated as airports and nothing else, in perpetuity. Each subsequent round of grant funding carried with it a new 20-year obligation under those original terms.

Judges Harry Pregerson, Richard Paez, and Jacqueline Nguyen are hearing arguments from City attorney Deanne Maynard et al, while the U.S. Department of Justice is represented by Alisa Beth Klein.

The City argues that the original documents never included title to the land and that the federal government is now trying to take title. The City is trying to dismiss or “quiet” the title claim under the “Quiet Title” act of 1972.

The government’s position is that Judge Walter’s ruling was correct, and that there is no way the City could even bring a claim under Quiet Title because the 1948 deal cast a cloud over the City’s title to the airport land.

The 1948 deal gave the City a substantially better airport with $1 million in improvements at no cost to the City, but the consideration was the acceptance of certain restrictive covenants that “run with the land,” meaning in perpetuity.

Attorney Klein said the City is now trying to say there are no restrictive covenants on the land, when there are in fact encumbrances attached to it. “The only question is, did the City know that the U.S. disagreed,” said Klein.

Klein continued, “That’s why the prayer for relief, which is saying to declare that the city has unencumbered title to the land, is too late in the game to bring as a quiet title action. To the extent there’s a dispute, it will have to wait for what is hypothetical, but an enforcement action by the United States.”

We’ll be paying close attention as this case plays out, because this author’s belief is that the ramifications of this case could have far-reaching consequences for many other airports around the U.S. operating under similar agreements.

Mike Straka, PhD
HStaff Writer and Technical Support
Chairman, Colorado Aviation Business Association

Sources:
1. Santa Monica Airport Land Title Row Is Timely, 9th Circ. Told. Linda Chiem. Law360, New York, March 14, 2016.
2. Santa Monica Airport Case Gets Hearing Friday. Hector Gonzalez. Santa Monica Lookout, March 11, 2016.
3. FAA Says Santa Monica Airport Must Stay Open Until 2023. Dan Weikel. Los Angeles Times, December 4, 2015.