Legal Question in Real Estate Law in California

There is nothing special about being within the City of Los Angeles that would preclude a prescriptive easement being established the same as anywhere else in California. Whether the elements to establish it actually exist is not something I can answer based on an internet question. If you mean, however, that the City of Los Angeles is the OWNER of one of the parcels, then the answer is yes, there is a lot of law that says you cannot obtain a prescriptive easement over public property.

Sounds to me as though a prescriptive easement can be established through the usual process, a quiet-title action. In urban locations, such as Los Angeles, it may be harder to establish ownership by adverse possession where a fence is a few feet off, since the courts tend to maintain property lines where the surveys say they should be. However, where the issue is the right to maintain a retaining wall, which incidentally benefits both properties, is the issue, and all that is claimed is an easement (rather than fee ownership), the urban setting will not be a major factor and a court is likely to grant an easement by prescription for the retaining walls.

There's a big difference between the doctrine of adjacent and lateral support and a prescriptive easement. I suggest you talk to a competent real estate attorney first.