Ferydoun Ahadpour, A.K.A. F. Ahadpour, and Doris Ahadpour - Page 7

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          approvals” made by the City of Huntington Beach under the                   
          “General Plan” with respect to a zoning variance for Phase I of             
          the project.  The residents also contended that height                      
          restrictions were violated and that the project did not promote             
          the general welfare of the neighborhood.                                    
               In a letter dated May 11, 1990, the attorney representing              
          the residents wrote a letter to the deputy city attorney for                
          Huntington Beach and the executive director of the California               
          Coastal Commission to inform the parties that the condominium               
          development project was in violation of the State of California’s           
          (State) public easement over patented tidelands.5  Soon after,              
          the State declared that the Phase I and II properties were                  
          located on tidelands and were subject to a public trust easement            
          in favor of commerce, navigation, and fishing.                              
               Because of the State’s claim regarding the public easement,            
          the closing of escrow was delayed.  CDC requested that                      
          petitioners further extend escrow past the September 1, 1990,               
          closing date.  On September 5, 1990, Mr. Steinman referred the              
          State’s easement claim to First American Title Insurance Co.                
          (First American) for resolution under petitioners’ title                    
          insurance policy, which had been issued April 2, 1979.                      

          5  This letter also informed the parties that the                           
          development project violated the Alquist-Priolo Special Studies             
          Act since the planned location of one of the buildings was                  
          directly over the trace of an active earthquake fault.  Such a              
          location is prohibited.  This matter was resolved by CDC.                   

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