inversecondemnation.com

Land Use Round Up

Some interesting items, worth reading:

• According to this story, the preferred developer of the New London, Connecticut project that gave us Kelo apparently is on the ropes.  Professor Gideon Kanner's take on the latest misstep is here.

• From Dean Patty Salkin's Law of the Land blog, a summary of Agripost, LLC v. Miami-Dade County, No. 05-16499 (11th Cir. Apr. 22, 2008), the latest case on the Williamson County ripeness/res judicata Catch-22. 

• From the Court of Federal Claims comes Schooner Harbor Ventures, LLC v. United States, No. 06-87L (Apr. 15, 2008), where the landowner sought compensation after the Fish and Wildlife Service designated property as critical habitat for the Mississippi Sandhill Crane.  The landowner asserted that the designation killed a deal for it to sell the property to the Navy.  Too bad said the CFC, the right to sell the property to the Navy without restrictions is not a "property" right subject to Fifth Amendment protections:

The plaintiff’s argument fails in that the plaintiff is asserting that it had the right to sell its property to the government, without conditions imposed, in this instance to meet regulatory burdens  imposed on the Navy, by obtaining the mitigation parcel. Whereas, the right to alienate the property is a cognizable property interest, the right to sell the property to the government at a particular price and without conditions is not a cognizable property interest which is protected by the Fifth Amendment. 

Slip op. at 13. 

• The LA Times has commentary on California's upcoming Propositions 98 and 99, two items on the ballot regarding the exercise of eminent domain power and property rights:

Your decision on Prop. 98 may come down to how you answer two questions: Is it worth risking future public works projects, including water? Is rent control bad? If the answer is yes to both questions, vote yes on 98. If the answer is no to either question, vote no -- then yes on 99.

County Motion in Maui Affordable Housing Exaction Case

The County of Maui has filed a motion for summary judgment in the federal court challenge to the County's affordable housing exaction ordinance.  The memorandum in support of the motion is posted here (215k pdf).

The Maui ordinance, enacted last year, imposes a 40% to 50% affordable requirement on new housing developments.  I posted on the case earlier here (contains a link to the complaint), and analyzed the legal problems with the ordinance under state law here .

The plaintiff landowner earlier filed a motion for partial summary judgment (1.5mb pdf) asking the court to declare the ordinance unconstitutional on its face under the Nollan/Dolan doctrine of unconstitutional exactions, which requires the government to show a substantial nexus between the exaction and some problem caused by the property owner before the government may demand tribute as a condition of development.  The exaction must also be roughly proportional to the problem.  The plaintiff's motion is posted here.  See this post for more on the nexus analysis.

The hearing on both motions is currently set for June 2, 2008, at 9:45 a.m., before District Judge Ezra.

Disclosure: I presented testimony against an earlier version of the ordinance.

Upcoming Land Use and Eminent Domain Seminars

Head's up to two upcoming seminars worth attending: "Planning Zoning and Eminent Domain" (May 8-9, 2008), and "Planning and Zoning 101" (May 7, 2008), both of which will be put on by the Center for American and International Law, in Plano, Texas.  Registration information for both seminars is here.  The faculty is first-rate, and includes many of the stars in our field -- Gideon Kanner, Dwight Merriam, and Robert Freilich.  I won't be able to attend, but I have in the past, and highly recommend it.

Condemnation Blight and Clouding Use

On the topic of the Willets Point case, inequitable precondemnation activities, and condemnation blight, thanks to Professor Gideon Kanner for reminding us of his seminal article on the subject, Condemnation Blight: Just How Just Is Just Compensation?, 48 Notre Dame Law Review 765 (1973) (the Notre Dame Law Review was then called the Notre Dame Lawyer).

I read it a while ago, but it's worth revisiting.  It received the Shattuck Prize from the American Institute of Real Estate Appraisers (now the Appraisal Institute) and it was the sole authority relied on by the Oregon Supreme Court in rejecting the New York Clement rule.  More about the subject here (Professor Kanner's Gideon Trumpet blog).  Check it out.

Blighting Property by Inequitable Precondemnation Activities

Thanks to No Land Grab for informing us of the latest eminent domain action from New York City, this time with an interesting twist.  In Willets Point Industry and Realty Ass'n v. City of New York, No. 08-1453 (E.D.N.Y. filed Apr. 9, 2008), land and business owners in Queen's, N.Y. filed a federal court complaint alleging that the City purposefully withheld vital infrastructure improvements such as sewers, paved streets, and trash removal, among other things. 

4.  Why are the City Defendants waging this campaign of neglect against one of the City's own neighborhoods?  The reasons probably have changed over the decades but, on information and belief, at least one of the reasons behind the current campaign is clear.

5.  New York City is undertaking a project to acquire Willets Point, evicting the existing businesses (which likely will lead to their destruction), and replace them with businesses that the City deems more desirable.  The City Defendants can help this project by driving down the value of the existing businesses and their property, so that the City more easily can justify and finance the exercise of its powers of eminent domain.

Complaint at 2.  Would municipal condemnocrats* do such outrageous things?  Well, allegations like those in the latest case are hardly a new story; check out Village of Willowbrook v. Olech, 528 U.S. 562 (2000) (per curiam) where the Court held that a landowner who asserted that local officials retaliated against her for winning an earlier lawsuit against the village was entitled to bring a "class of one" equal protection claim, for example.  See also Klopping v. City of Whittier, 500 P.2d 1345, 1350 n.1 (Cal. 1972), where the court noted:

it would be manifestly unfair and violate the constitutional requirement of just compensation to allow a condemning agency to depress land values in a general geographical area prior to making its decision to take a particular parcel located in that area. The length of time between the original announcement and the date of actual condemnation may be a relevant factor in determining whether recovery should be allowed for blight or for other oppressive acts by the public authority designed to depress market value.

*My colleague Mark Murakami's term for bureaucrat/condemnors.

Discretion Wins Out Over Valor in Half Moon Bay Inverse Condemnation Case

Remember that whopping $36.8 million inverse condemnation judgment against the City of Half Moon Bay, California by the U.S. District Court back in November 2007?  Yamagiwa v. City of Half Moon Bay, No. 05-4149 VRW (Nov. 28, 2007).  The city said at the time it was going to appeal, and it hired some pretty impressive guns to do so.  Now, however, it appears that the city has changed its mind, as reported in the San Francisco Chronicle's story, "Half Moon Bay's plan to avert fiscal ruin."

In a move to save their city government, Half Moon Bay officials tonight approved a settlement agreement with a developer who won a $36.8 million court judgment last fall that threatened to leave the city in financial ruins.

The Half Moon Bay City Council signed off on an $18 million settlement to developer Charles "Chop" Keenan, whose trustee wanted to build an 83-unit subdivision on a 24-acre property that the city had inadvertently turned into protected wetlands.

Under the agreement, which was accepted by the developer, the city could get out of paying a cent if it can successfully get special legislation passed that would allow Keenan to build 129 lots on the property and an adjoining parcel, bypassing wetlands protection laws.

Read the complete report here.  The city probably should have thought about the consequences before it turned the plaintiff's property into undevelopable wetlands, but government regulators often don't seriously consider the possibility of losing.  The law is stacked against property owners, and government has no problem interposing all sorts of procedural hurtles in an effort to expense the property owner down (as one government attorney once confessed, "we'll 'motion' you for a year before we ever reach the merits").  Even if the government eventually loses, any monetary judgment will be paid with O.P.M. (Other People's Money).  In this case, however, the judgment was more than three times the annual municipal budget, an amount so large it could not be ignored by the city fathers and mothers. 

Read the District Court's 167-page Findings of Fact and Conclusions of Law if you want to find out the whole sordid story of what led up to the judgment. 

New Article: Property Rights in the Ninth Circuit, And Beyond

The Federalist Society has posted a new edition of Engage - The Journal of Federalist Society Practice Groups, a newsletter-format publication with short scholarly articles on topics such as Administrative Law, Environmental Law and Property Rights, and Civil Rights, among others. 

The most interesting article in this edition is Property Rights in the Ninth Circuit, and Beyond by J. David Breemer, Damien Schiff, and Elizabeth Yi, which analyzes the Crown Point case, where the Ninth Circuit finally ditched the Armendariz doctrine.  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.  Crown Point signals a revival of substantive due process as a viable claim in land use cases in the Ninth Circuit.  Download the article here.

Inverse Condemnation and the Border Patrol

Here's another case involving property rights along the U.S. - Mexico border, but the issue is somewhat different than last week's US v. 1.04 Acres case.  The issue this time is not the border fence, and it's not about an affirmative exercise of eminent domain.  Instead, this case involves allegations of entry onto private property by agents of the U.S. Border Patrol in pursuit of illegal immigrants. 

In International Industrial Park, Inc. v. United States, No. 06-876L (Feb. 22, 2008), a San Diego, California-area property owner sued the federal government in the Court of Federal Claims for just compensation, complaining of the Border Patrol's violation of its property rights:

As a result of these initiatives since September 11, 2001, IIP states that Border Patrol agents occupy Parcel 11 on an around-the-clock basis. Mr. Wick states in his declaration that Border Patrol vehicles speed across roads on IIP’s property, and that vans or buses are brought in to haul away the illegal aliens. He further states that Border Patrol agents fan out over Parcel 11 on all-terrain vehicles, on horseback, or on foot in an effort to apprehend illegal immigrants. Mr. Wick complains that Border Patrol agents even stop and question him, as well as contractors or employees, as they go about their business on the property. He says that he often is stopped while showing the property to potential buyers or lessees. IIP alleges that the Border Patrol has cut open locked gates, and has graded its own roads on the property. IIP asserts that the Border Patrol has damaged Parcel 11’s environmentally sensitive areas, and interfered with construction projects. Mr. Wick states that the Border Patrol has declined offers  to lease portions of the property for its law enforcement activities, or to discuss the granting of further easements.

Slip op. at 5.  The CFC held that the six-year statute of limitations did not require dismissal of the lawsuit (see, e.g., the John R. Sand & Gravel case), rejecting the government's argument that its activities on the land was no worse in the past six years than it was before.

The court also held that the landowner's complaint properly stated a claim for relief, dismissing the government's claim that because a previous owner of the land had granted the Border Patrol a limited right of entry, that did not mean that the owner had surrendered the right to exclude.  Slip op. at 9.  The court also rejected the government's argument that it was immune from having to pay compensation because the Patrol's activities were exercises of police power.  The court was right on, because a claim for just compensation in the CFC is predicated on the landowner's recognition that the activities complained about are otherwise legitimate -- the CFC may only award compensation, and lacks jurisdiction to strike down regulations, or enjoin government activity.  Only district courts have that power.

Read the entire opinion here.

Cert Petition to Overrule Williamson County Denied

The US Supreme Court has denied a petition to review a Seventh Circuit opinion which dismissed a property owner's regulatory takings challenge on ripeness grounds under Williamson County Regional Planning Comm'n v. Hamilton Bank, 473 U.S. 172 (1985).  The questions presented by the petition called for overruling Williamson County. 

The case is Peters v. Village of Clifton, No. 07-635.  The Supreme Court order is here.  A summary of the Williamson County rule, the petition, and amicus briefs can be found in this post.

This issue isn't going away.  Four Justices in San Remo Hotel, L.P. v. City & County of San Francisco, 545 U.S. 323 (2005) stated that the ripeness rule needed to be revisited and overruled. 

Nollan/Dolan in Federal Court Challenge to Maui's "Affordable Housing" Exaction Scheme

The plaintiff property owner has filed a motion for partial summary judgment in the federal court challenge to Maui County's "affordable housing" requirement.  Kamaole Pointe Development LP v. County of Maui, Civ. No. CV07-00447 DAE LEK (filed Feb. 28, 2008). 

The Maui ordinance, enacted last year, imposes a 40% to 50% affordable requirement on new housing developments.  I posted on the case earlier here (contains a link to the complaint), and analyzed the legal problems with the ordinance under state law  here . 

The plaintiff's motion is posted here (1.5mb pdf).  It asks the court to declare the ordinance unconstitutional on its face under the Nollan/Dolan doctrine of unconstitutional exactions, which requires the government to show a substantial nexus between the exaction and some problem caused by the property owner before the government may demand tribute as a condition of development.  The exaction must also be roughly proportional to the problem.  See this post for more on the nexus analysis.

Update: the hearing on the motion is set for April 28, 2008, at 10:30 a.m. in Judge Ezra's courtroom.

[Disclosure: I presented testimony against an earlier version of the ordinance.]