Cuna Mutual Life Insurance v. Los Angeles County Metropolitan Transportation Authority

This appeal arises out of an inverse condemnation action brought by CUNA Mutual Life Insurance Company, the owner of the historic El Capitan Theater Building, against the Los Angeles County Metropolitan Transportation Authority to recover costs CUNA incurred to protect the building from damage it anticipated would be caused by excavation for and construction of the Hollywood/Highland Metro Rail Station. After a simultaneous court and jury trial on the issues of liability and damages, respectively, the trial court dismissed the jury and entered judgment in favor of MTA, finding “insufficient evidence that the . . . station construction . . . caused damage to the El Capitan. Without actual or prospective damage proved, there can be no inverse condemnation award.”

On appeal, we consider two questions: (1) did the trial court utilize the correct legal standard in deciding that CUNA’s mitigation expenses were not recoverable; and (2) is compensable physical injury necessary before a property owner may recover mitigation expenses. We conclude: (1) a property owner is entitled to recover reasonable costs incurred to mitigate damage to the property that the property owner…