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Check out this site, www.branfordtaborrecord.com. It's published by the property owners in a Connecticut eminent domain fight, and contains the entire trial record. More on the case and the $12.4 million jury verdict from the New York Times here.
The Honolulu Advertiser reports that the Chamber of Commerce of Hawaii is advocating in favor of a bill limiting the "use" of a state or county road as a trigger to chapter 343 environmental review:
The state Department of Transportation, responding to two previous Supreme Court rulings, asked the state Environmental Council early last year to generally exempt the private construction of driveways or the installation of utilities within state road right-of-ways from environmental assessments. The Supreme Court, in a 1997 decision involving the Kahana Sunset project on Maui and in a 2006 decision on the Koa Ridge project in Waiawa, found that projects that touch state road right-of-ways technically use state lands and trigger potential environmental assessments.
Section 343-5, as interpreted by the Hawaii Supreme Court, requires an agency to undertake an environmental assessment if an applicant's project (broadly construed to include both the specific proposal and, as in the Superferry case, the "secondary impacts" of the project) proposes the "use of state lands."
The "Koa Ridge" case mentioned in the article is Sierra Club v. State of Hawaii Office of Planning, 109 Haw. 411, 126 P.3d 1089 (Jan. 27, 2006), which I discussed in this post. In that case, the court noted its earlier decisions determining that the "use of state lands" trigger was to be taken both literally and liberally. "Use of state lands" thus includes construction of two underpasses under a state highway, Citizens for Prot. of N. Kohala Coastline v. County of Hawaii , 91 Haw. 94, 979 P.2d 1120 (1999), and the placement of a drainage system under state land that was part of a larger project. Kahana Sunset Owners Ass'n v. County of Maui, 86 Haw. 66, 947 P.2d 378 (1997).
The Federalist Society has posted video and audio files of the January 3, 2008 faculty panel on post-Kelo reform. Video is below, audio posted here (21mb mp3).
An interesting discussion is going on over at Volokh Conspiracy about Professor Gideon Kanner's critique (posted here and here) of journalist Jeffrey Toobin's new book on the Supreme Court, particularly the section dismissing the reaction to Kelo as the product of right-wing reactionaries.
The posts are worth reading for an inside look at what makes a Supreme Court case, especially the amicus process. Don't miss Kanner's responses in the comments here, here, here, here, and his deconstruction of Berman, Midkiff, and Kelo here.
We filed amicus briefs in Kelo (supporting Mrs. Kelo, natch) and the regulatory takings case heard the same day, Lingle v. Chevron U.S.A., Inc.
Are rumors of the demise of the Ninth Circuit's Armendariz doctrine greatly exaggerated, or is J.J. Hunsecker (Burt Lancaster)'s advice to Sidney Falco (Tony Curtis) in the noir classic Sweet Smell of Success more appropriate?
What brings this to mind is the parting shot in the recently-issued opinion in Matsuda v. City and County of Honolulu, No. 06-15337 (Jan 14, 2008), where the Ninth Circuit panel -- in a case involving a Contracts Clause claim which was brought together with a substantive due process claim -- added:
Furthermore, we express no opinion as to whether our decision in Armendariz v. Penman, 75 F.3d 1311 (9th Cir. 1996) (en banc), precludes the Lessees from asserting a substantive due process claim in this case, where the Contracts Clause provides a specific source of constitutional protection against the government conduct of which they complain. Id. at 1318.
Slip op. at 411. This looks like an attempt to resurrect the Armendariz rule, recently put to rest by a different panel of the Ninth Circuit in Crown Point Development, Inc. v. City of Sun Valley, No. 06-35189 (Nov. 1, 2007).
Armendariz stood for the proposition that a property owner's claim for violations of substantive due process rights were "subsumed" within the owner's claim for violation of the Takings Clause. Thus, in land-related issues, a property owner could only bring takings claims. The reasoning behind the rule was that when government conduct is proscribed by an "explicit textual source of constitutional protection" such as the Takings Clause, a plaintiff must rely on that source, not the due process clause. But as the Ninth Circuit held in Crown Point:
As the Court made clear, there is no specific textual source in the Fifth Amendment for protecting a property owner from conduct that furthers no
legitimate government purpose. Thus, the Graham rationale no longer applies to claims that a municipality’s actions were arbitrary and unreasonable, lacking any substantial relation to the public health, safety, or general welfare.
Crown Point, slip op. at 14457-58. The Contracts Clause protects different interests than due process protections. Substantive due process protects against arbitrary and unreasonable government conduct, while the Contracts Clause does not deal with the reasons for government conduct, it simply prohibits states from passing laws impairing the obligations of contract, reasonable or not. The dicta in Matsuda should not get far.
My Damon Key colleagues Robert Harris and Tred Eyerly are publishing a blog (or is that "blawg?") on Hawaii insurance law issues which is named, appropriately enough, Insurance Law Hawaii.
Robert and Tred can be found at www.insurancelawhawaii.com. Pay a visit, say hello, and subscribe to their RSS feed.
I've had a chance to review Matsuda v. City and County of Honolulu, No. 06-15337 (Jan 14, 2008), a decision by the Ninth Circuit on the Contracts and Due Process clauses, but which also involves how local governments exercise the power of eminent domain. The case revolves around Chapter 38 of the Honolulu Revised Ordinances, which was the local version of the "land reform act" at issue in Hawaii Hous. Auth. v. Midkiff, 467 U.S. 229 (1984) before it was repealed in 2005.
Background
Finding that the economic ills purportedly caused by the concentrated ownership of private single-family residential property in Hawaii, Haw. Rev. Stat. ch. 516 allowed homeowner/lessees to petition the Hawaii Housing Authority to exercise eminent domain on the homeowner's behalf and condemn the fee simple interest underneath their homes from the lessor, and transfer it to the lessee upon payment of just compensation.
After that statute was upheld by the U.S. Supreme Court against a Fifth Amendment public use challenge in Midkiff, and under the Hawaii Constitution's public use clause by the Hawaii Supreme Court in Hawaii Hous. Auth. v. Lyman, 68 Haw. 55, 704 P.2d 88 (1985), efforts were made to pass similar legislation affording condominium owners the same ability to force condemnation of their leasehold interests.
Chapter 38
At the state level, those efforts were ultimately unsuccessful, but the City and County of Honolulu eventually enacted a local version, codified as Hon. Rev. Ord. ch. 38. The ordinance relied on the same "anti-oligopoly" rationale as the Land Reform Act, and when it was challenged under the public use clauses of the U.S. and Hawaii Constitutions, the courts predictably, as in Midkiff and Lyman, rejected both federal (Richardson v. City and County of Honolulu, 124 F.3d 1150 (9th Cir. 1995)) and state (Richardson v. City and County of Honolulu, 76 Haw. 46, 868 P.2d 1193 (1994)) challenges.
Under chapter 38, the owners of many Honolulu condominium projects were permitted to condemn and take the leasehold interests from their lessors. By 2005, however, public sentiment regarding eminent domain had turned (as noted in this report), and the City Council surprisingly repealed chapter 38.
Matsuda
The story does not end there, however, because at the time of repeal, several condominium apartment owners had begun the process to condemn their leaseholds, and claimed they were entitled to continue the process through to completion.
In Matsuda, the condo owners applied to the city to "convert" (condemn) their leases, and entered into written contracts with the city, in which the condo owners each agreed to pay the city $1,000, in return for which the city promised that after its acquisition of the lease, it would convey it to the condo owners. The owners subsequently received the city's approvals, but final approval by the City Council was withheld because the council was already considering repealing Chapter 38. The ordinance repealing Chapter 38 eventually contained a provision allowing any conversion proceeding which has been approved by the City Council to be completed, but because Matsuda's had not received council approval, the taking was denied.
Matsuda and others filed suit against the city in federal court, alleging that the repeal of Chapter 38 was a violation of the U.S. Constitution's Contracts Clause:
No State shall . . . pass any Bill of Attainder, expost facto Law, or Law impairing the Obligation of Contracts. . .
U.S. Const. art. I, § 10. This provision was designed to prevent states and their political subdivisions from passing laws relieving politically favored persons (and the government itself) of their contractual obligations. The condo owners also alleged violation of the Due Process Clause. The District Court granted summary judgment to the city and threw the case out.
Reserved Powers / Contracts Clause
The court held that the repeal of Chapter 38 was not a local government impairing its own contracts -- and the Contracts Clause was inapplicable -- because the contracts were not enforceable under the "reserved powers" doctrine, which states that any contract whereby the government purports to contract away its discretion to exercise an essential attribute of sovereignty is void. Thus, there was no contract to be impaired. The seminal cases applying this doctrine to the exercise of eminent domain are West River Bridge Co. v. Dix, 47 U.S. 507 (1848) and Contributors to Pennsylvania Hospital v. City of Philadelphia, 245 U.S. 20 (1917). In those cases, the Court held that contracts whereby the government implicitly and indirectly agreed to not take property were not enforceable.
Best Efforts
The Ninth Circuit reversed, holding that the district court applied the wrong legal test. The district court should have viewed the repeal of Chapter 38 with "heightened scrutiny" because the repeal of Chapter 38 was the city voiding its own contracts. The Ninth Circuit held that the reserved powers doctrine was not applicable because West River Bridge and Contributors to Pennsylvania Hospital cases were contracts limiting the exercise of the power of eminent domain, while the contracts at issue in Matsuda required the exercise of the power. The Ninth Circuit held:
As an initial matter, the City's contracts with the Lessees did not expressly require the City to condemn the property at Discovery Bay. As discussed above, Chapter 38 imposed several requirements for a successful condemnation which were beyond the City's power to control, and the City only agreed to use its best efforts to achieve those results. Thus, if an insufficient number of condominium owners applied to the City or if the public hearing held by the Department failed to produce a finding that condemnation would serve a valid public purpose, the City would not have been obligated under the contracts to proceed with the condemnation.
Slip op. at 408. Presumably, the Ninth Circuit would reach a different result if the contract did require the city to condemn the property, as that would be a clear delegation of sovereign powers also. The court held that the district court should have found that a contract existed, and gone forward to determine whether the repeal of Chapter 38 "impaired" those contracts.
Due Process
The district court, applying the same reserved powers analysis noted above, also held that there were no enforceable contracts, and therefore no property was at stake, and it did not need to address the condo owners' Due Process claims. The Ninth Circuit reversed and sent the case back for a determination of whether the city/owner contracts were "property."
Sidebar: The oral argument recordings are posted here. KITV's report is here. The Hawaii Supreme Court dealt with another condominium project in City and County of Honolulu v. Sherman,110 Haw. 39, 129 P.3d 542 (Feb. 28, 2006).
Tim Sandefur at PLF on Eminent Domain adds his thoughts about Matsuda v. City and County of Honolulu, No. 06-15337 (Jan 14, 2008).
The US Court of Appeals for the Ninth Circuit has issued an opinion in Matsuda v. City and County of Honolulu, No. 06-15337 (Jan 14, 2008), a case involving the city's repeal of Chapter 38, Honolulu's version of the "land reform act" at issue in Midkiff, allowing the conversion of condominium leases to fee simple absolute by eminent domain. Leaseholders who were caught mid-process when Chapter 38 was repealed, brought claims under the Due Process and Contracts clauses. The district court dismissed the claims under the reserved powers doctrine, but the Ninth Circuit reversed, and sent the case back for further proceedings. I haven't had a chance to digest it in full, but will post a complete rundown shortly.
Update: complete summary of the opinion here.
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Briefs, articles, and documents, via JD Supra
Eminent domain abuse: County of Hawaii v. Richards, No. 28882 (HAWSCT)
Shoreline accretion amicus brief (HAWICA)
Kelo v. City of New London amicus brief (SCOTUS)
Lingle v. Chevron USA amicus brief (SCOTUS)
Ohana Kauai Property Tax merits brief (HAWSCT)
Ohana Kauai Property Tax merits brief (HAWSCT)
The Complete Guide to Zoning by Dwight H. Merriam (2005)
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