Black Hills Investments, Inc. v. Albertson's, Inc

In Black Hills Investments, Inc. v. Albertson's, Inc. (2007) 146 Cal.App.4th 883, the Fourth Appellate District, Division One applied these statutes to contracts for the sale of real estate that the trial court ruled were void because they violated the Subdivision Map Act. (Black Hills, at p. 886.) The contracts "obligated Albertson's supermarket to obtain and record a parcel map legally subdividing the property prior to the agreed-upon closing date. Paragraph 8A, however, made that obligation subject to an express condition that gave Albertson's the right to terminate the contracts in the event Albertson's failed to obtain governmental approval of the creation of the two parcels." (Id. at p. 887.) Before the closing date, the other party to the contract, Black Hills Investments, Inc., sent a letter to Albertson's stating it wanted to terminate the contract. (Id. at p. 888.) Black Hills Investments, Inc., then filed a complaint against Albertson's seeking a declaration that the contracts were void because they were entered into before the subdivision map had been recorded in violation of the Subdivision Map Act. (Black Hills, at p. 888.) The trial court granted summary judgment in favor of Black Hills Investments, Inc. (Id. at p. 889.) On appeal Albertson's claimed the trial court erred in determining the contracts were not expressly conditioned on the filing of a parcel map as required by section 66499.30, subdivision (e). (Black Hills, supra, 146 Cal.App.4th at pp. 889-890.) The appellate court disagreed. While the "contracts obligated Albertson's, as the seller, to obtain and record a parcel map legally subdividing the property prior to the agreed-upon closing date," it "made that obligation subject to an express condition that gave Albertson's the right to terminate the contracts 'without liability' in the event Albertson's, before the closing date, either (1) failed to obtain governmental approval of the creation of the two parcels, or (2) 'waived' the condition in writing." (Id. at p. 893.) Based on this language, the court found that the contracts did not comply with section 66499.30, subdivision (e) because they did not expressly condition the sale of the parcels on the approval and filing of a parcel map. (Black Hills, at p. 893.) The court therefore "concluded the contracts were illegal under the Subdivision Map Act, and thus void rather than voidable, as a matter of law at the time they were executed ... ." (Black Hills, at p. 894.)