Complete information, including registration, faculty, and agenda, here.
Complete information, including registration, faculty, and agenda, here.
Posted on January 8, 2017 in ▪ Eminent Domain | Condemnation, ▪ Inverse condemnation, ▪ Just Compensation | Appraisal, ▪ Land use law, ▪ Nollan/Dolan | Exactions, ▪ Penn Central, ▪ Property rights, ▪ Public Use | Kelo, ▪ Rail, ▪ Rails-to-Trails, ▪ Redevelopment, ▪ Regulatory takings, ▪ Seminars, ▪ Williamson County | Ripeness, ▪ Zoning & Planning | Permalink | 0 Comments
Following up on our post earlier this week with our amicus brief, here are the remainder of the briefs filed in the Federal Circuit in a case in which the government is asking the court to bypass panel hearing and go straight to en banc review of a Court of Federal Claims opinion which held that the owners of a railroad easement which was converted to a recreational path are owed $900 in just compensation, plus EAJA fees.
Why all this sturm und drang (as the Federal Circuit once characterized rails-to-trails cases) over 900 bucks?
As we wrote in our earlier post, this is the government's attempt to wipe out established regulatory takings doctrine and get the Federal Circuit to effectively overrule its prior decisions holding the government liable for physical takings when it prevents reversion of the railroad easement to private owners when those easements are no longer used for railroad purposes, even if those takings are not permanent. Here, the government asks the Federal Circuit to abandon the per se physical takings test and instead apply the ad hoc regulatory framework when the taking is not "permanent."
Here are the other briefs:
What we found most disturbing about this effort was the government's complaint that these darn recreational trails are costing money. The doctrine "encourages litigation!" And when property owners have to sue to enforce their rights, they get attorneys fees, "guaranteed!" See Op Br at 2. The nerve!
Our response: if you don't want to pay for these things, don't take them.
Registration is now open for the 2017 Hawaii Land Use Conference, presented by the Hawaii State Bar Association and the University of Hawaii Law School, at the downtown Honolulu YWCA's Fuller Hall on Jnauary 19-20, 2017. "This 2 day conference is a must attend for any attorney or professional whose practice involves land use and development," as the registration web site says (we agree).
Topics include the latest in Transit-Oriented Development, the Thirty Meter Telescope, GMO (including the recent rulings from the Ninth Circuit), and the topic we'll be presenting, "Takings: Regulatory and Physical."
The final agenda has not yet been released, but if experience is any guide, Planning Chair Professor David Callies will put together two days of timely topics, presented by distinguished faculty.
And the cost can't be beat: $200 for members of the Real Property and Financial Services Section and government lawyers, $300 for other HSBA members, and $325 for everyone else.
Members of the HSBA can register on line, while others need to do so on paper here or below.
We'll post more when the agenda and faculty list is finalized. In the meantime, reserve your space, because this conference is only held once every two years, and as a consequence, the room fills up quickly.
Posted on December 6, 2016 in ▪ Administrative law, ▪ Agriculture, ▪ Eminent Domain | Condemnation, ▪ Environmental law, ▪ Inverse condemnation, ▪ Land use law, ▪ Municipal & Local Govt law, ▪ Rail, ▪ Regulatory takings, ▪ Seminars, ▪ Shoreline | CZMA, ▪ Water rights | Public trust, ▪ Zoning & Planning | Permalink | 0 Comments
Are you like us and cannot type, write, or say "statue" without it coming out "statute?" That's an affliction we've had since law school days, and one we're probably never going to shake.
As lawyers, we've all no doubt seen plenty of crappy statutes in our careers.
But, at the risk of being offensive, here's an actual s**t statue, located in the City of Chicago. Created by an artist tired of dog owners allowing their Fidos to do their business on the artist's front steps, he protested in the only way he knew how: by reproducing the offending items in bronze, larger than life, with water flowing out of the top.
Crass but apparently effective: evidence of actual dog doo was nowhere to be found during our recent visit.
Tomorrow, Thursday, October 6, 2016, at 10:00 a.m. at Aliiolani Hale, the Hawaii Supreme Court will hear oral arguments in a case we've been following (we filed an amicus brief in the case, supporting the property owner on the first Question Presented), County of Kauai v. Hanalei River Holdings, Ltd., No. SCWC-14-0000828.
The case is a taking by the County of several parcels on the north short of Kauai, but the main issue in the case -- do parcels need to physically touch in order for the jury to consider them part of a larger economic parcel -- goes well beyond this one case. The Honolulu rail project, probably the biggest eminent domain project in Hawaii's history, is underway, and the larger parcel issue could arise is more than a few cases there. What we thought was settled doctrine in Hawaii law was thrown into question by the Court of Appeals' decision in this case.
The case involves three parcels on Kauai -- one of which is owned by a fellow who has been a thorn in the County's side -- which were condemned by the County for the expansion of a public beach park. The County was taking Parcels 49, 33, and 34. Sheehan owned 49, and HRH, a corporation, owned 33 and 34. Sheehan asserted his use of Parcel 49 stretched across 33, 34, and Area 51 -- a portion of another Parcel but not a separate record lot. He claimed to use Area 51 pursuant to an easement.
The court of appeals held that Hawaii law requires that two parcels abut before a jury can consider them part of a larger parcel. The property owned by the condemnee was separated from the other parcel he claimed to use, and not physically connected. The condemnee claimed he used the two parcels together as a boat yard, and therefore the taking of his property damaged his use of the other.
The ICA held that the owner "cannot satisfy the physical unity requirement” because the two parcels Petitioners claim to use together are separated by two others. County of Kauai v. Hanalei River Holdings, Ltd., No. CAAP-14-0000828, slip op. at 31; 2016 Haw. App. LEXIS 224, at *10 (2016). The ICA asserted the "must touch" test was established by the Hawaii Supreme Court in City and County of Honolulu v. Bonded Investment Co., Ltd., 54 Haw. 523, 511 P.2d 163 (1973), which, in the ICA's view, required "that all of the pertinent lots abut one another." Slip op. at 20.
Here is the description of the case and the Questions Presented from the Judiciary's web site:
Petitioners/Defendants-Appellants Hanalei River Holdings, Ltd. (HRH) and Michael G. Sheehan (Sheehan) apply for writ of certiorari, challenging the Intermediate Court of Appeals’s (ICA) May 11, 2016 Judgment issued pursuant to its March 31, 2016 Published Opinion. The ICA affirmed the Final Judgment As to All Claims and All Parties of the Circuit Court of the Fifth Circuit (circuit court), filed on April 25, 2014, except with regard to the award of blight of summons damages. The ICA vacated the award of blight of summons damages and remanded to the circuit court for further proceedings.
This case arises from the County of Kauaʻi’s (the County) condemnation of three parcels of property owned by HRH and Sheehan. The County deposited $5.89 million with the circuit court as estimated just compensation, and the circuit court issued an order of possession in favor of the County. In addition to HRH and Sheehan, Patricia Wilcox Sheehan also claimed an interest in the properties. Almost a year later, HRH and Sheehan submitted an application to withdraw the estimated just compensation. The County opposed their application arguing that it still had not been determined that HRH and Sheehan were the owners of the properties and that an updated appraisal showed that the value of the properties on the date that the condemnation action was filed was only $4.86 million. The County also moved to withdraw the $1.03 million excess from its original deposit. Subsequently, Patricia Wilcox Sheehan waived her claims, and HRH and Sheehan entered into an agreement with the County, whereby the County agreed to HRH and Sheehan’s withdrawal of $4.86 million on the condition that Sheehan indemnify the County for any failure of HRH to return excess payments. HRH and Sheehan withdrew $4.86 million, and the circuit court granted the County’s motion to withdraw the remaining $1.03 million.
Prior to trial, HRH and Sheehan claimed that they had a right to severance damages for a piece of property referred to by the parties as Area 51, that was actually a part of a larger parcel owned by Patricia Wilcox Sheehan. The County opposed HRH and Sheehan’s claim and moved for partial summary judgment on the severance issue. The circuit court granted partial summary judgment in favor of the County, holding that there was no unity of title because Area 51 was owned by Patricia Wilcox Sheehan, no unity of use because Sheehan’s permits to operate a boatyard on the condemned parcels and Area 51 had been revoked, and no physical unity because Sheehan’s parcel did not abut Area 51.
At the end of the jury trial, the jury determined the total value of the condemned parcels to be $5.8 million. The circuit court also awarded HRH and Sheehan blight of summons damages on the jury verdict from the date of the summons until the date that the County deposited $5.89 in estimated just compensation and from the date that the County amended its deposit to $4.86 million to final payment on the $940,000 difference between the jury verdict and the amended deposit.
HRH and Sheehan appealed to the ICA, arguing that the trial court erred when it permitted the County to withdraw a portion of the estimated of just compensation, when it granted summary judgment in favor of the County on the issue of severance damages, and in its calculation of blight of summons damages. The ICA affirmed the circuit court on the first two issues. However, the ICA disagreed with the circuit court’s calculation of blight of summons damages and held that the interest should have been tolled from the date that the County made its unconditional deposit of estimated just compensation until the date that Patricia Wilcox Sheehan waived her claims and it became clear that HRH and Sheehan were entitled to receive the compensation.
HRH and Sheehan’s application for writ of certiorari present the following questions to this court:
1. Must two parcels physically abut in order for the jury to consider whether they are part of a larger parcel?
2. Where there are multiple properties being condemned from different owners, does statutory interest on a conditional deposit only accrue after each condemnee establishes an entitlement to its portion of the deposit?
3. Does Hawaiʻi Revised Statutes § 101-19 enable a condemnor to withdraw a portion of its estimate of just compensation after deposit with the Court and after taking possession of the property?
Stay tuned. The court usually posts oral argument recordings shortly after the case is submitted. We'll bring you some post-argument thoughts as warranted.
Yesterday was the first debate in the race for Honolulu mayor. As this story from Chad Blair at Honolulu Civil Beat noted, "In Honolulu Mayoral Forum, It's All About The Rail."
To save our readers from having to wade through the long-winded answers the candidates gave on that topic, here’s our shorthand summary of their respective positions:
- Kirk Caldwell (incumbent): Continue past Middle Street to Ala Moana only if we have the money to do so (we’ll talk about this after the election).
- Charles Djou (former Congressman (R)): Continue past Middle Street to Ala Moana only if the total cost does not exceed $7,000,000,000.
- Peter Carlisle (former mayor): Complete the rail to Ala Moana, regardless of cost. Increase GET to pay for it, since nobody knows how much they pay in GET.
As we noted last week, the expanding costs of the Honolulu Rail project has forced Honolulu's mayor to ask whether construction should be delayed or stopped entirely, short of its planned terminus at Ala Moana shopping center. "Middle Street" became the new rail watchword, even though stopping it there would omit -- temporarily or permanently -- the most densely populated, and therefore the most useful, portion of the route.
Middle Street is somewhat of a nondescript, dare we say it, "blah" street; more of a demarcation between the airport area and the more industrialized Dillingham corridor. A place you generally go by on your way elsewhere, not consider a destination. Frankly, it doesn't have much of a reputation for anything exciting. In our minds, it is most notable as the border between "town" and "country," at least psychically.
- Civil Beat's Chad Blair, however, sees it differently. In a tongue-in-cheek piece "Meet Middle Street, Oahu’s Hot New Travel Destination," he details the things to be found along Middle Street, perhaps soon to be the center (middle) of things, if the rail truly does end there: "All your needs are met on Middle Street: Bread. God. School. Booze. Fried chicken. Gas. Money. Cars. Japanese food. Karaoke. Restrooms. Jail. Clearly, Mayor Caldwell and Council Chair Ernie Martin are on to something. Ala Moana simply pales in comparison." Based on his report, we're going to have to reconsider Middle Street. Well played, sir!
- On a much more serious note, Gordon Pang at the Star-Advertiser reports that "Rail cost could be nearly $3 billion above current estimates." We're talking nearly $11 billion. Three billion more than the $8 billion currently projected by the FTA, and way more than the $3+ billion this thing was originally advertised as costing. See "Rail project may create 9,000 jobs" (Jan 17, 2008) ("Honolulu's $3.7 billion commuter rail project could generate an average of 9,100 jobs during the nine years it takes to build it. Those direct and indirect jobs could provide a boost to Honolulu's economy — and the construction sector in particular — between 2009 and 2017."). Those are real sit up and take notice numbers.
- Finally, Star-Advertiser political columnist Richard Borecca writes that "Kakaako property owners [those east of Middle Street, who are now in limbo] suffereing for 'maybe train.'" ("Down Kona Street is Steve Scott’s Scott Hawaii, which started in 1932 making plantation boots for sugarcane and pineapple field workers; now its Scott slippers are a well-known local brand. The city doesn’t want all of Scott’s property, just 7 feet of setback along one side. After months of negotiation, he and the city came to agreement, only to find out now that everything has stopped. “When the mayor came out initially and said stop at Middle Street, we said ‘Good, they won’t be coming here,’ but then Caldwell said he still wants to finish the project. We don’t know if he is stopping or not,” Scott said in an interview."). For more on the legal aspects of this limbo, see this post.
Stay tuned, folks.
In a surprise move, Honolulu Mayor Kirk Caldwell today announced that he supports suspending the Honolulu rail project at Middle Street, at least until there's more money in the coffers. See "Mayor, Council chairman say rail should end at Middle Street for now" from Marcel Honore at the Star-Advertiser.
We think the key words in that headline are "for now," and this is not the end of the project, necessarily. Notwithstanding that, as the story notes, this could be a "seismic shift" for the project, which has been plagued by massive cost overruns and other embarrassments since its inception, such as having its financially-savvy Board chairman resign and be replaced by a career politician, only to see her set her cap for Congress and abandon ship when one of Hawaii's two House seats unexpectedly became available. What started off as a project projected to cost a bit more than $3 billion for 20 miles and 21 stations of steel-on-steel elevated track, has ballooned to more than $8 billion, exclusive of operating costs. The voters of Honolulu approved the project when they voted for the creation of HART, the Honolulu Authority for Rapid Transit. But as of late, the concerned voices expressing their dissatisfaction have grown louder and more strident. Middle Street is approximately half way from the Kapolei start point (pictured above) to the planned terminus at Ala Moana shopping center, and halting the rail there would almost certainly undermine its utility, as it would not include the most densely populated portion of the route.
What could this mean? Is this only election-year politicking by a mayor seeking to co-opt his opponents' issues? A genuine recognition of financial realities? Does this mean rail has derailed, and if so, is this permanent?
We have more questions than answers at this point, but this much we do know:
- What about properties already seized by eminent domain -- does the City need to sell those properties back to their former owners? No, Hawaii law does not have any requirement, unlike some other states, for property taken by eminent domain to be sold back to a prior owner if the public use for which it was taken never comes to pass. Maybe Hawaii law should require that to happen, and perhaps the Hawaii Supreme Court would conclude that the constitution requires it. But for now, there's no decisional law, nor is there any statute which requires it.
- However, the Hawaii eminent domain code does require that if a taking is abandoned or dismissed prior to final judgment, the condemnor is on the hook for "damages." Meaning at least all attorneys and appraiser fees and costs incurred by the property owner, who is entitled to be made whole by the condemning authority. The Hawaii Supreme Court so held in a case in which we represented the property owner.
- Also, should the rail project really stop halfway, the City isn't off the eminent domain hook, necessarily, especially after telling the remaining property owners for years that their parcels were going to be acquired. Inverse condemnation is a potentially available remedy for those owners whose properties were clouded by the project, even if the project is delayed, or even if it is never completed as planned.
For now, we must wait for more definite answers.
We did a post a while back about a Houston barbecue restaurant which had some troubles with the Harris County, Texas, Metropolitan Transit Authority. The court of appeals held that the restaurant's lost profits could not be recovered in an inverse condemnation action.
Well, that same court has rendered an opinion in a case involving a different restaurant impacted by the same transit authority. Doneraki serves Mexican fare (although our first impression was that a restaurant with "doner" in the name was probably a Turkish joint; we stand corrected). Or should we say "served Mexican fare," because alas, the place -- as the photo above shows -- is now boarded up and out of business.
The owners alleged it was the Transit Authority's construction of the rail, and the resulting rail line (also shown) that caused it to fail. The rail did not condemn any of Doneraki's property. The owners contended only that rail construction interfered with access to their establishment, and that "once construction was completed, access to the restaurant was possible but difficult." They sued in inverse condemnation, seeking to "recover lost profits allegedly caused by the temporary, total denial of access to the restaurant during the construction of the North Line." They also "sought to recover for the permanent diminution in the value of the property caused by the alleged material and substantial impairment of access once the North Line construction was completed." The trial court dismissed the complaint.
The court of appeals reversed. Padilla v. Metropolitan Transit Authority of Harris County, No. 14-14-00939 (May 24, 2016). The loss of access was not, as the Authority argued, a "community damage" shared by all. Or at least there was a factual dispute about whether it was, and whether the construction caused a "temporary, total denial of access to appellants' restaurant." Slip op. at 10. Yes, the Authority submitted evidence that it didn't interfere in such a way and that it was careful and "always made arrangements for access to the restaurant and parking areas for the use of the restaurant's patrons," but the owners also submitted testimony that "virtually every day," and for months at a time "all the entrances and exits were blocked." Slip op. at 11. This wasn't a conclusory statement as the Authority alleged, but was testimony that raised a genuine dispute of fact. There being a dispute of fact, the court concluded that -- should Doneraki be able to prove access was blocked -- these were not the type of non-compensable inconveniences associated with all government transportation projects[.]"
The court also rejected the Authority's claim that it didn't have the intent to take Doneraki's property (and thus, under Texas law, there can be no inverse condemnation). The Authority pointed out that it contractors and their subs performed the work, and if there was a denial of access, it was on them and not the Authority. Thus, it argued, we didn't intend to cause specific damage to Doneraki.
The court disagreed, holding that it was enough to show intent that the rail project was "an authorized Metro project." Its own contracts with its contractors contained provisions requiring them to "minimize the impact of construction on surrounding property owners."Slip op. at 14. Which means the Authority anticipated such impacts. Thus, the Authority was not completely in the dark about the possibility of causing the type of impacts that Doneraki alleged. Again, an issue of fact.
Reversed and remanded.
Earlier today, we asked the Federal Circuit for its permission to file this amici brief urging the court to rehear its recent panel decision in Romanoff Equities, Inc. v. United States, No. 15-5034 (Fed. Cir. Mar. 10, 2016).
This is a rails-to-trails takings case in which the panel concluded that the words in the original easement grant "for railroad purposes and for such other purposes as the Railroad Company ... may ... desire to make" mean that the easement was a "general" easement which allowed the grantee to not only make railroad use of the easement, but literally any use it desired. Thus, when the railroad abandoned the line and the City of New York turned it into the Highline public park, the reversionary property owners were not entitled to compensation.
Our brief argues that there's no such animal as a "general" easement that allows the grantee to do anything it likes with the easement. The nature of easements are limited, and its hornbook law that an easement is supposed to be for a special purpose, not a general one. From the brief's Summary:
Words have meaning. Especially words in a document conveying an interest in real property. These words must be viewed in light of the intent of the parties as expressed by the terms of the instrument, state law, and the “special need for certainty and predictability where land titles are concerned.” Certainty and predictability in property is not a rule that exists for its own sake, sui generis, but one which forms the foundation of every other civil right. The panel, however, violated these principles when instead of certifying the question to the New York courts, it discovered in the Romanoff conveyance something never before seen in New York law (or the law of any other jurisdiction): a “general easement,” which can be used “for any purpose for which the grantee wishes.” In doing so, it permitted the Romanoff family’s property which its predecessors conveyed for railroad purposes, to be impressed into public service as a recreational space without compensation.The concept of a general easement has not been recognized by any New York court (or the courts of any other jurisdiction), and we argue that the the panel made its best guess, when it should have, at minimum, certified the question to New York's state courts:
It is highly doubtful that a New York court—were it given the opportunity to consider the question—would conclude than an interest labeled by the grantor as an “easement” (usually defined as use for a “special purpose”), is a “general easement” that contemplated use for any purpose, especially uses as admittedly unrelated to the easement’s main railroad purpose as tai chi, “gender bending performances from the club and theater stage,” garden tours, and “stargazing.” Here, we have a very specific easement which was for railroad purposes to eliminate at-grade crossings. But even if the easement was granted in general terms, the rule of construction is to construe the extent of its use only as is “necessary and convenient for the purpose for which it is created.” An easement to do anything the grantee wants for as long as it wants isn’t really an “easement,” it is a grant of fee simple by another name. The panel’s ruling has effectively converted the grant of an easement for railroad purposes into a fee simple estate, contrary to both the terms of the instrument and New York law.
Urban property at the intersection of two main thoroughfares can be pretty valuable. It's about location, for sure, but it's also about visibility and the ability to be seen from four directions.
Charlotte, NC needed a part of such property for a rail line extension. The rail will be in the middle of the road, so the road needed widening, necessitating the partial taking. The rail "Bridge" will be part of that middle-of-the-road construction in an existing public right of way, but will partially block views of the owner's remaining property (a bank branch).
But the Bridge won't be on the condemned property, and the city asserted that means it isn't liable for damages resulting from the loss of visibility. The trial court concluded that the jury could consider evidence of loss of visibility, and the city's interlocutory appeal followed.
In City of Charlotte v. University Financial Properties, LLC, No. COA15-473 (Apr. 5, 2016), the North Carolina Court of Appeals held that the loss of visibility isn't part of the compensation and damages which the city owes. Likening the loss of visibility to to reduction of traffic flow past condemned property (which isn't compensable under NC law), the court concluded that the visibility loss does not "flow directly" from the taking of the bank's land. The landowner won't lose all visibility -- and there's no "constitutional right to have anyone pass by his premises at all -- this is like a change in traffic pattern:
We are unable to discern a meaningful distinction between (1) the assertion that a landowner is entitled to compensation because its property has diminished in value due to the reduction in traffic caused by a municipality’s actions; and (2) University Financial’s contention here that it is entitled to compensation for the decreased value of its property based on the reduced visibility to passing traffic caused by the City’s construction of the elevated light rail bridge. Consequently, we hold that the loss in visibility of University Financial’s property to passing traffic is not “part of the taking” and that the trial court’s order holding otherwise must be reversed.
Slip op. at 9-10 (footnote omitted). "Thus," the court concluded "the fact that a physical taking has occurred is not enough to render compensable injuries that are otherwise recognized as noncompensable that do not arise from the condemnor's use of the particular land taken." Slip op. at 12.
Here's what's going on today, the first day of the 33d annual ALI-CLE Eminent Domain and Land Valuation conference in Austin, Texas. We're at standing room only, with a record number of attendees and our usual nationally renown faculty.
We started off the day with our usual "Eminent Domain Update" session with Amy Brigham Boulris, and as mentioned, the links to the opinions which we discussed are going to be posted in a separate post today.
We are being followed by a panel on pipeline takings, one of the hot issues nationwide, with Joe Waldo, Matthew Ray, MAI, Thomas Peebles, and Dave Domina.
That session was followed by Professor Ilya Somin, talking about his book, "The Grasping Hand: Kelo v. City of New London and the Limits of Eminent Domain."
Above are our annual "proof of life" photos taken from the lectern, to show we are actually in the room and not out enjoying all that Austin has to offer.
Posted on January 28, 2016 in ▪ Blight, ▪ Court of Federal Claims | Federal Circuit, ▪ Eminent Domain | Condemnation, ▪ Inverse condemnation, ▪ Just Compensation | Appraisal, ▪ Land use law, ▪ Nollan/Dolan | Exactions, ▪ Penn Central, ▪ Property rights, ▪ Public Use | Kelo, ▪ Rail, ▪ Rails-to-Trails, ▪ Redevelopment, ▪ Regulatory takings, ▪ RLUIPA | religious land use, ▪ Seminars, ▪ Uniform Relocation Act, ▪ Zoning & Planning | Permalink | 0 Comments
For those of you who missed last week's Hawaii State Bar Association presentation by our Damon Key partners Mark M. Murakami (left) and Greg Kugle (right) on the significant 2014-2015 decisions by the Hawaii Supreme Court about land use, administrative appeals, quiet title, shoreline, regulatory takings and condemnation, and preemption, you're in luck: the Real Property Section recorded the session. Check it out.
Posted on November 25, 2015 in ▪ Administrative law, ▪ Agriculture, ▪ Eminent Domain | Condemnation, ▪ Environmental law, ▪ Inverse condemnation, ▪ Land use law, ▪ Municipal & Local Govt law, ▪ Nollan/Dolan | Exactions, ▪ Penn Central, ▪ Rail, ▪ Regulatory takings, ▪ Seminars, ▪ Shoreline | CZMA, ▪ Zoning & Planning | Permalink | 0 Comments
Time for the annual "Litigation Update" by our Damon Key colleagues Greg Kugle and Mark M. Murakami, which they do each year for the HSBA's Real Property and Financial Services Section. (Materials from last year's talk available here.)
- Date: Friday, November 20, 2015 (that's tomorrow, folks)
- Time: 12 noon - 1:00 p.m.
- Location: HSBA Conference Room, 1100 Alakea Street, 10th Floor, Honolulu
- Cost: FREE for RPFSS members. If you aren't a member and want to attend, ping me.
Greg and Mark will cover Hawaii decisions from the last year involving land use, administrative appeals, quiet title, shoreline, reg takings and condemnation, and preemption. They will also cover decisions from other jurisdictions which have an impact on Hawaii property law practice.
These two are at the top of their game, so come on down and get the information, as well as hear their insight about what the decisions mean.
Posted on November 19, 2015 in ▪ Administrative law, ▪ Agriculture, ▪ Appellate law, ▪ Eminent Domain | Condemnation, ▪ Environmental law, ▪ Inverse condemnation, ▪ Just Compensation | Appraisal, ▪ Land use law, ▪ Municipal & Local Govt law, ▪ Nollan/Dolan | Exactions, ▪ Penn Central, ▪ Rail, ▪ Redevelopment, ▪ Regulatory takings, ▪ Seminars, ▪ Shoreline | CZMA, ▪ Water rights | Public trust, ▪ Zoning & Planning | Permalink | 0 Comments
Here's the full agenda for the 2016 Eminent Domain and Land Valuation Litigation / Condemnation 101 Conference, January 28-30, 2016, in Austin, Texas.
Together with our friend and colleague Joe Waldo, we think we're put together a pretty good program that covers a lot of ground. This is the first time the conference has been to Austin, and we're starting off with a talk by Austin Mayor Steve Adler, who in his former life was an eminent domain lawyer. Other highlights:
- Professor Ilya Somin will speak about his recently-published book in a segment entitled "The Impact of Kelo and the Limits of Eminent Domain."
- "Pipelines and Energy Corridors: Valuation Perspectives of Condemnors and Condemnees" with the lawyers on the front lines of one of the hottest topics in eminent domain law nationwide.
- Retired Minnesota Supreme Court Justice Paul H. Anderson will give us his tips in "The Art of Effective Negotiation - A Judicial View." Justice Anderson has a unique view on eminent domain, since he not only litigated cases as a lawyer and resolved them as a jurist, he was also a property owner in a condemnation action.
- "Advice to Condemnees From Condemnors" - two lawyers who represent agencies with the power of eminent domain will share their thoughts on the do's and don't from a condemnor perspective.
- You often hear "war stories" about lawyers' successes. But often, you learn the most from your mistakes, and your recovery from those errors. In "Eminent Domain Trials: Lessons Learned the Hard Way," three experienced eminent domain lawyers will reveal their missteps, and how they became better lawyers as a result.
- Dana Berliner and W. Andrew Gowder will present about one of the cutting-edge topics in the nation's courtrooms: "First Amendment for Fifth Amendment Lawyers: Free Speech, Signs, Defamation, FOIA, and RLUIPA Claims."
- The concept of highest and best use means that eminent domain lawyers are often land use lawyers as well. In "Probability of Rezoning as an Element of Valuation," land use law experts Nikelle Meade, Dwight Merriam, and Charles W. (Chase) Ruffin will get you the information you need to know.
We especially focused on the ethics component this year, and are looking forward to the session on "Ethics: Tips and Traps for the Eminent Domain Practitioner" at the first plenary session on the second day.
The complete agenda is posted here, and we think it has more than a few sessions that will catch your interest.
The faculty, as you might have guessed, is the best-of-the-best, selected from lawyers who represent both property owners and condemnors:
- Steve Adler, Mayor, City of Austin, Texas
- Jody Harper Alderman, Alderman Bernstein, Denver
- Paul H. Anderson, Soule & Stull, Minneapolis; Retired Associate Justice, Minnesota Supreme Court
- Robert E. Bainbridge, C-Store Valuations, Dallas
- Joshua E. Baker, Waldo & Lyle, P.C., Norfolk, Virginia
- Stanley G. Barr, Jr., Kaufman & Canoles, P.C., Norfolk, Virginia
- Sara K. Beachy, Assistant Attorney General, Wisconsin Department of Justice, Madison
- Michael M. Berger, Manatt, Phelps & Phillips, LLP, Los Angeles
- Dana Berliner, Director, Institute for Justice, Arlington, Virginia
- Susan Bonnen, Chief Appellate Counsel, Texas Office of the Attorney General, Austin
- Amy Brigham Boulris, Gunster, Yoakley & Stewart, P.A., Miami
- Roy R. Brandys, Barron & Adler, LLP, Austin
- James S. Burling, Director of Litigation, Pacific Legal Foundation, Sacramento
- Ivy N. Cadle, Baker, Donelson, Bearman, Caldwell & Berkowitz, PC, Macon, Georgia
- F. Adam Cherry, III, Randoph, Boyd, Cherry and Vaughan, Richmond, Virginia
- Christopher M. Clough, Barron & Adler, LLP, Austin
- Anthony F. Della Pelle, McKirdy & Riskin P.A., Morristown, New Jersey
- Robert C. Dew, Jr., GDS Associates, Inc./Hi-Line Engineering, Marietta, Georgia
- David A. Domina, Domina Law Group PC LLO, Omaha, Nebraska
- Jill S. Gelineau, Schwabe, Williamson & Wyatt, P.C., Portland, Oregon
- W. Andrew Gowder, Jr., Pratt-Thomas Walker, P.A., Charleston, South Carolina
- Janet Bush Handy, Deputy Counsel, Assistant Attorney General, Maryland State Highway Administration, Baltimore
- Daniel D. Hannula, Hannula & Halom, Superior, Wisconsin
- Mark F. (Thor) Hearne, II, Arent Fox LLP, Washington, D.C.
- Jamila A. Johnson, Schwabe, Williamson & Wyatt, Seattle
- Nikelle S. Meade, Husch Blackwell LLP, Austin
- Dwight H. Merriam, Robinson & Cole LLP, Hartford, Connecticut
- Mark M. Murakami, Damon Key Leong Kupchak Hastert, L.C., Honolulu
- Robert B. Neblett, Jackson Walker L.L.P., Austin
- Thomas H. Peebles IV, Waller Lansden Dortch & Davis, LLP, Nashville, Tennessee
- J. Casey Pipes, Helmsing, Leach, Herlong, Newman & Rouse, P.C., Mobile, Alabama
- Matthew P. Ray, MAI, Cantrell & Ray, Inc., Jacksonville, Florida
- Rick E. Rayl, Nossaman LLP, Irvine, California
- Joshua H. Rikon, Goldstein Rikon Rikon & Houghton P.C., New York
- Charles W. Ruffin, Baker, Donelson, Bearman, Caldwell & Berkowitz, PC, Atlanta
- Mark D. Savin, Fredrikson & Byron, P.A., Minneapolis
- Paul R. Scott, Smith, Phillips, Mitchell, Scott & Nowak, LLP, Hernando, Mississippi
- Joseph V. Sherman, Waldo & Lyle, P.C., Norfolk, Virginia
- Randall A. Smith, Smith & Fawer, L.L.C., New Orleans
- Ilya Somin, Professor of Law, George Mason University School of Law, Arlington, Virginia
- Michael Sullivan, Range West Consultants LLC, Prescott, Arizona
- Joseph P. Suntum, Miller, Miller & Canby, Chartered, Rockville, Maryland
- Christian F. Torgrimson, Pursley Friese Torgrimson, Atlanta
- Martin E. Wolf, Gordon, Wolf & Carney, Chartered, Towson, Maryland
Register here (includes hotel registration information as well as information on how to take advantage of early-bird and multiple attendee registrations).
The 2016 Conference is looking good, and we're looking forward to topping last year's San Francisco attendance.
Come, join your colleagues for three days of fantastic programming, networking, and fun in Austin. Hope to see you there.
Posted on October 13, 2015 in ▪ Appellate law, ▪ Blight, ▪ Court of Federal Claims | Federal Circuit, ▪ Development agreements, ▪ Due process, ▪ Eminent Domain | Condemnation, ▪ Environmental law, ▪ Inverse condemnation, ▪ Judicial Takings, ▪ Just Compensation | Appraisal, ▪ Land use law, ▪ Municipal & Local Govt law, ▪ Nollan/Dolan | Exactions, ▪ Penn Central, ▪ Property rights, ▪ Public Use | Kelo, ▪ Rail, ▪ Rails-to-Trails, ▪ Redevelopment, ▪ Regulatory takings, ▪ Rent Control, ▪ Seminars, ▪ Williamson County | Ripeness, ▪ Zoning & Planning | Permalink | 0 Comments
Our friend and colleague Alan Ackerman posted a note on his blog about a recent District Court ruling from the Western District of Virginia which upheld the power of a potential condemnor to enter property for the purposes of survey, without formally taking the property. See "Virginia Federal Judge Follows What May Be the Majority Rule for Surveys." But Alan didn't post the court's written ruling. So here you go, all 35 pages of it.
The issue was whether a Virginia statute, which "authorizes a natural gas company to enter private property without the landowner's written permission and perform a survey for a proposed natural gas pipeline," is a facial violation of the U.S. and Virginia Constitutions, and "is thus void and unenforceable." Slip op. at 1. The court granted the gas company's motion to dismiss. It concluded that the facial challenge failed because the property owners do not possess a right to exclude entries for purposes of surveying in anticipation of an exercise of eminent domain. It also concluded that an as-applied challenge was not ripe.
This is similar to -- but not the same as -- the issue now being considered by the California Supreme Court in Property Reserve, Inc. v. Dep't of Water Resources, No. S217738. In that case, an as-applied challenge, the entries which the Department of Water Resources proposed to undertake were not minor and innocuous, but pretty major, and, as the Court of Appeal concluded, were well beyond the minor intrusions allowed by California's entry statute. The Court of Appeal concluded the proposed entries rose to the level of takings, meaning that if the DWR wanted to undertake them, it would have to exercise its eminent domain power to do so. For more about why, see the amicus brief we filed in that case.
This is a different case as evidenced by the Virginia's court's ruling that the as-applied challenge was not ripe because the gas companies "have not entered plaintiffs' properties, and they have no intention of doing so now, given the change to the proposed route of the pipeline." Slip op. at 11. That being so, there was no way to tell whether the gas company's proposed entries went too far. The court merely held that Virginia's statute was not unconstitutional in all cases, something that should not be surprising given the number of similar statutes around the country, and the low level of interference with a landowner's rights that they allow. It's when the entry allowed by the statute is used for intrusive entry that there's constitutional trouble.
We presume that were a Virginia gas company propose to make entries that exceed what is contemplated in the statute or otherwise interfere with an owners' property rights in a concrete way, that it well could be a taking and subject to the same rules recognized by the California Court of Appeal. The Virginia court didn't foreclose this, but merely told the owners to come back when you're subject to actual and not hypothetical entry by the gas companies. That may not happen with these plaintiffs, because it appears that the gas companies are looking at other parcels. And maybe this was the goal all along.
The Virginia court also rejected Fourth Amendment and Due Process challenges. Again, not a surprise, is it?.
Here's what we are reading today, eminent domain with a slightly offbeat theme:
- From our New Jersey colleague Tony Della Pelle: "Nevada's 'Area 51' Neighbors Facing Eminent Domain." The truth is out there, Tony.
- More on the story: "Family Rejects Air Force's $5.2 Million Bid for Land Near Area 51."
- Another colleague -- who shall remain unnamed -- sent this: "City, strip club owner duke it out over last downtown club," about a city's attempt to shut down an "adult entertainment" club as a nuisance. And get this: "If the city succeeds in seizing the property it would become the property of the city-county school system under a provision of state law." Oh my.
- Finally this: an attempt to invalidate the Honolulu City Council's approval of the rail project because -- get this -- two of the councilmembers who voted to approve it had ethics problems and didn't disclose their conflicts of interest. Void ab initio says the Complaint, and there must be a re-vote or ratification of the allegedly invalid approvals. Via Honolulu Civil Beat ("Lawsuit Seeks New City Council Votes on Honolulu Rail"). The suit was brought by the uber-rich "princess" Abigail Kawananakoa, and alleges taxpayer standing. Good luck with that, Your Majesty, even under Hawaii's relaxed rules of standing.
Hawaii Business magazine has a new report about Honolulu rail. The headline asks, "How Much Will It Cost Us In The End?"
There are questions of how much over original projections the rail project currently is. Or whether it is really over budget at all. Anywhere from zero (according to HART), to $1 billion. And, of course, whether there is an upper limit on how high the costs could go. Anyone with an interest in rail should read the story.
The only thing we have to add is that in our view (as we wrote here), the only honest answer is "as much as it takes."
The project is already being built, and they aren't going to simply stop now that they've started to pour concrete. In addition to having commenced construction, the legal machinery of the project is well underway, with properties being acquired and otherwise targeted for taking.
Moreover, Honolulu voters approved of rail -- if only indirectly -- by authorizing the formation of HART. The key politicians are supporting rail and have built their "legacies" on the project. The legislature, despite some shibai, re-authorized a special tax to pay for rail. The courts, with a couple of glitches, have rebuffed all legal challenges.
In other words, it is full steam ahead.
And once that happens, in our experience, something as minor as ballooning costs will not stop the rail. And when we say "minor," we don't mean minor to the taxpayers of Honolulu. That may be pretty major, no matter on whom the blamestorming ultimately pins the tail. What we mean is that in the view of rail and other government officials, the cost aspects are only of serious concern if they threaten to stop the project, which they will not.
As we wrote earlier, the model for officials' attitude is former New York City Mayor Bloomberg who responded to attacks on a marquee redevelopment project that came under heavy fire, "[n]obody's gonna remember how long it took. They're only gonna look and see that it was done."
Hawaii's officials are also predicting that no one will remember how much it cost, either.
Here's a case in which the court ruled there wasn't a taking, but it could be argued that the property owners won. How so? Because this case pitted the property rights of railroads against the property rights of the owners over whose land the rail lines run.
The U.S. Court of Appeals asked the Louisiana Supreme Court to answer this certified question:
Whether the application of LA. REV. STAT. § 48:394 to any of the properties in this case amounts to an unconstitutional taking of private property without a public purpose, in violation of Article I, Section 4 of the Louisiana Constitution.
In Faulk v. Union Pacific Railroad Co., No. 2014-CQ-1598 (June 30, 2015), the Supreme Court answered no.
The case arose in 2007 after the railroad planned to close 100-year old private crossings over its tracks, which the property owners asserted disrupted their farming operations and their ability to access their land on both sides of the tracks. They sued in Louisiana state court, seeking among other things, an injunction prohibiting the railroad from closing the crossings. The railroad removed to federal court. The railroad counterclaimed, seeking a declaration that it could close the crossings, and an injunction prohibiting the plaintiffs from interfering.
After the lawsuit was filed, the Louisiana legislature adopted the statute noted above, which required railroads planning on closing private crossings to give the state PUC and affected property owners advance written notice. It is then up to the PUC to determine whether the crossing can be closed. The statute became operative in August 2008.
The district court ruled for the railroad on the claims of some plaintiffs, but also concluded that the railroad had no right to close any crossings after the effective date of the statute unless it followed the statutory process. The court rejected the railroad's claims that the statute was unconstitutional.
On appeal to the Fifth Circuit, it held the district court should not have reached the takings claim because the railroad had not established a record to show that it owned anything. The case was remanded to develop that record. Returning to the district court, the parties agreed that the railroad owned a property interest, even though they didn't agree precisely what that interest was. The railroad asserted it owned the fee, while the plaintiffs claimed it was only a "servitude." The district court agreed with the plaintiffs.
The district court certified the takings question (both state and federal) to the Fifth Circuit, which, after concluding that the railroad had waived its federal takings claims by failing to brief them earlier, in turn certified the state law takings question to the Louisiana Supreme Court.
The railroad argued the statute prevented closure or removal of private crossings and was a taking under Louisiana's rules for inverse condemnation under which the court must:(1) determine if a recognized species of property right has been affected; (2) if it is determined that property is involved, decide whether the property has been taken or damaged in a constitutional sense; ;and (3) determine whether the taking or damaging is for a public purpose under Article I, Section 4.
Slip op. at 10 (citing Avenal v. State, 886 So.2d 1085, 1104 (La. 2004). Applying the test and detailing Louisiana's civil property law, the court held there wasn't a taking because the grants to the railroads by the property owners' "ancestors in title" was only the right for the railroad to use the land together with the landowner. It was not a fee simple grant, nor a grant of exclusive use to the railroad. And here's the interesting part:Union Pacific's attempt to gain exclusive use of the land burdened by its servitude (by contending that requiring it to leave in place the private railroad crossings, which have been in place for decades for the plaintiff/landowners' use, is a “taking”) turns the constitutional “taking” law on its head. To deny the plaintiff/landowners the simple right to cross over the tracks to reach the remainder of their property when there are no trains on the tracks (in other words, when Union Pacific is not using its right of use servitude) would change the nature of the right Union Pacific possesses from mere use to something more closely resembling ownership. If Union Pacific obtains what it seeks -- exclusive use of the property – it, not the plaintiff/landowners, seemingly will have accomplished an inverse condemnation, not having complied with expropriation procedures, and there is no indication that “just compensation” was paid to the plaintiff/landowners “to the full extent of [their] loss,” as required by LSA-Const. Art. I, § 4.
Slip op.at 21.
Nor was it a temporary physical taking of the railroad's property, because the statute is only a reasonable restriction on use. And railroads are already a highly regulated industry, subject to tight PUC rules. The court also concluded that the statute applied retroactively.
Finally, it concluded that the railroad's takings claim was not ripe, because it had not submitted the matters to the PUC, which might allow the crossings to be closed.
Compare these two reports, filed just over a month apart, about California's "high speed" rail system, now underway in the Central Valley:
- Bullet train no bonanza for Valley eminent domain attorneys (The Business Journal, March 19, 2015)
- High-speed rail escalates eminent domain legal battles for land (Fresno Bee, April 20, 2015)
And here's a report on an aging mass transit system, BART (there are lessons here for HART, Honolulu's fledgling municipal rail transit authority):
- BART looking to 2016 voters for property tax increase to fix ailing system (Daniel Borenstein, Contra Costa Times)
The short answer: taxes.
[Update #1: a report from last night's community meeting, "Railing Against Honolulu's $6 Billion Rail Project" ("Honolulu Mayor Kirk Caldwell and his top transit official took their licks from a decidedly anti-rail crowd during a boisterous town hall meeting at Washington Middle School on Wednesday."
Update #2: "A Hawaii Senate committee passes a bill to extend the GET rail surcharge another give years, but makes clear the money should only be used to build the rail line" (4/8/2015, via Civil Beat).]
There's been a lot of breathless reporting over the past couple of weeks about the skyrocketing cost of the 20-mile, 21-station Honolulu rail project. Cost estimates to build the line from Ewa to Ala Moana Center started off in the range of $3.5 billion, but anyone who was paying attention knew this wasn't anywhere in the ballpark. Sure enough, over time, the figure kept moving upwards. Now we're at, what, $6.5 billion, more or less? And there's nothing to indicate this is the upper limit except more promises that this figure is the light at the end of the proverbial tunnel.
Several state legislators are even holding a community meeting tonight (Monday, March 30, 2015) to let the people vent, and HART and the Mayor are going to dutifully show up and take any public lumps that may be coming their way.
But will anything come of this and the other (and we're paraphrasing here) "we're shocked, we tell you, shocked!" reactions to the revelations that the rail is going to cost more to build and perhaps operate than originally promised?
We predict no, that this is mostly political theater designed to assuage the public, when there's virtually no chance the project will get derailed or even scaled back, whatever it eventually costs. So despite all of the present posturing and prostrating before the public by officials, make no mistake: it's now too late to do anything but pay for the thing. New York City Mayor Bloomberg accurately projected the attitude of public officials when it comes to marquee projects such as Brooklyn's Barclay Center, "Nobody's gonna remember how long it took. They're only gonna look and see that it was done."
Besides, construction of the rail is already underway, and we know what that means.
So is HART (I mean "we") going to pay whatever this thing costs to build, maintain, and operate? Short answer: yes --
- The Hawaii Legislature is reviewing whether to extend the "sunset" period for the extra General Excise Tax that we pay in the City and County of Honolulu. Our prediction: the Legislature will extend the tax. It has to. Maybe not as long as the city administration would like, but extend the GET increase it will, despite the noise being made. And the Legislature will keep on doing so until the project is paid for. Update: see Update #2 above.
- And how about the cost of running the thing, once built? A recent public meeting of HART's Transit-Oriented Development Committee revealed the preferred method to finance operation and maintenance (and it's no big secret): Tax Increment Financing. According to Wikipedia (which is, in this case, accurate), "TIF is a method to use future gains in taxes to subsidize current improvements, which are projected to create the conditions for gains above the routine yearly increases which often occur without the improvements." In other words, you pay for a project now by predicting that the project itself will raise property values in the future. HART is predicting -- mostly accurately, we think -- that property values along the rail corridor will rise as a result of rail being nearby. Whether they are within the City's contemplated "TOD" zone which will allow for more intensive and creative development than traditional zoning, or even outside of the TOD zones, where property values may increase due to the general gentrification that is predicted as a result of the rail. Bottom line: property taxes are likely going up. And the difference between what Honolulu property taxpayers pay now and what they will pay with the increased value -- the "tax increment" in "TIF" -- is what will pay for the rail.
This is what voters voted for, after all, when they, like Sgt. Deux Deux said "si" to the creation of HART (and the rail). From here forward, we all must say "oui."
The cover story in Pacific Business News' recent edition, "Honolulu rail transit's eminent domain" is worth reading. Most importantly, the PBN staff created maps which show how much property is targeted for acquisition, and where it is located, precisely. Yes, the full story is behind a partial paywall, but as we said last week, if you are in Honolulu you really should be a PBN subscriber. Plus, there are a few quotes from our side in the piece:
- “'Eminent domain cases are rare in Hawaii,'” Thomas said. 'Hardly anyone has a living memory — not the landowners, judges, lawyers or even the government officials — they can draw from when there are this many takings.'"
- "However, this could hurt property owners who choose to sell later, as they’ll have to disclose the illegal status of their building. Future owners may be confronted with the cost of tearing down or substantially remodeling the structure to conform to the building codes. In Murakami’s view, this is a way for government to 'cheap out' on its offers, sticking current and future property owners with real costs for which they have not been compensated."
Check it out.
We can't reproduce the entire interview, and the link to the online version is behind a partial paywall, but here are the highlights of a recent interview, where A. Kam Napier, the Editor-in- Chief of Pacific Business News, came by and chatted with us about eminent domain, property rights, and the Honolulu rail project.
- "Robert H. Thomas thinks it’s no accident that the Fifth Amendment in the Bill of Rights protects not only the right to due process for people accused of a crime but also the same rights for people who own property the government would like to take. The right of the people to be secure in their private property was that essential to the Founders.
- “'The Kelo decision was a direct result of the Midkiff decision, where essentially any public purpose that the government advances is going to be enough [to take the property] as long as there’s some way to tie it in to a public benefit,' Thomas said. 'Ironically, Justice Sandra Day O’Connor wrote the Midkiff decision [upholding the taking], it was her very first case as a justice. Her very last case before she retired 21 years later in 2005 was her dissent in Kelo [rejecting New London’s taking].'”
- "How fair is Hawaii’s eminent domain law, this being a famously liberal state with a professed concern for the little guy? 'I think our law is one of the most unfair in the country. They’re all generally unfair to the property owner. There are some, New York for instance, that are worse.'"
- "And yet eminent domain court battles are pretty rare in Hawaii. Why is that? 'Land is expensive and in an eminent domain taking, the government doesn’t just pay current value, it has to pay based on the best and highest use of the property so [local government typically avoids having to take private property because of the cost]. Then, on the property owner side, defending a condemnation suit has to pencil out — owners have to pay their own way for attorneys and appraisers if they think the government is undervaluing their land, even if the government loses and the jury awards a higher value.'"
- "People don’t realize, eminent domain is one of the few times where you can get sued for doing nothing wrong other than owning land the government wants."
Check out the entire interview here. "Robert Thomas on eminent domain" is the title, and a subscription is necessary to view the entire piece, sorry, although if you are in Honolulu, come on, you really should have a subscription to PBN.
If you didn't have a chance to attend last week's community meeting on the Honolulu rail project and property rights at Farrington High School, we've posted the audio clips, which include the big picture, the current status, and a series of frequently asked questions.
- FAQ's and background (including "The Numbers: How Much Land, How Much Money, How Much Time?," "Key Terms in Eminent Domain," "The 'Dear Owner' Letter," "Appraisals From an Eminent Domain Perspective," "Business Losses, Lost Profits, and Business Interruptions," "Relocation Benefits," and more)
- KITV video report
As reported yesterday by Pacific Business News ("HART acquired 34 properties for $70M along Honolulu rail transit route, new report says"), "[t]he Honolulu Authority for Rapid Transportation has acquired 34 properties totaling about $70.2 million thus far along the 20-mile rail transit route, including the recent purchase of a former sports bar property near Ala Moana Center for about $1.35 million."
In other words, it's begun.
In response to the many questions we've received from property owners, businesses. and homeowners whose rights may be at stake in the rail takings, we've organized a public forum to provide information about the project, Hawaii's eminent domain process, and how to protect the rights of people whose property or businesses are subject to acquisition.
- Date: Tomorrow, Thursday, March 5, 2015
- Time: 6:00 - 7:15 p.m.
- Location: Farrington High School Cafeteria
- Address: 1564 North King Street, Honolulu, Hawaii
Our colleague Mark Murakami was interviewed yesterday by KHON's Ron Mizutani (video above), and this morning by KITV's Howard Dicus (below video) on these subjects.
The State of New York wants to build the Bronx River Greenway, a "23-mile-long ribbon of green with a multi-use path that will extend along the full length of the river in Westchester County and the Bronx." Who could argue with that?
Amtrak, that's who. After failing to acquire 6 parcels along the river owned by the "private corporation created by the Rail Passenger Service Act of 1970, 49 U.S.C. § 24101," in 2008, the state filed notices of appropriation and maps with the county clerk, and title to the land vested in the state. They kept trying to work things out, apparently, but to no avail and in 2012, Amtrak sued in federal court, arguing that the takings were invalid under the Supremacy Clause because they were expressly or impliedly preempted by federal law.
In National Railroad Passenger Corp. v. McDonald, No. 13-4161-cv (Feb. 24, 2015), the Second Circuit never reached the merits of Amtrak's preemption claim, concluding instead that Amtrak waited too long to raise it. The court applied New York's six-year statute of limitations, and detailed the series of events that convinced the court that Amtrak knew or should have known about the injury:
We do not pause to determine the precise date on which NYSDOT knew, or had reason to know, because both possible dates are well beyond six years from the date this action was brought. In 2005, when Weld sent the email informing Amtrak that NYSDOT would hold a May 2005 public hearing on the subject of condemning Amtrak’s land, Amtrak arguably had reason to know of the alleged Supremacy Clause violation that is the basis of its present claim. Eminent domain proceedings cloud title, and Amtrak concedes that it suffered not merely potential, but actual injury once its property became the subject of EDPL proceedings. At the very latest, Amtrak had notice of this harm in August 2005, when NYSDOT announced its findings.
Slip op. at 9.
But wait, you say, the takings actually didn't take place until 2008, and since Amtrak sued in 2012, it was okay. Not so held the court, the "completion of the takings was merely the final act of the intrusion on Amtrak's alleged Supremacy Clause rights that accrued in 2005 at the outset of the condemnation proceedings." Slip op. at 10.
It would make no sense to begin the limitations period -- or restart it -- when title to the real estate actually vests in the state, an act that occurs only after notice to interested parties and the requisite findings have been made. Indeed, Amtrak's proposed rule would leave the validity of a condemnation of its property in doubt for some six years after title has passed. Common sense, not to mention the record of Amtrak's failure to take any of the obvious protective measures, directs otherwise.
Slip op. at 10 (footnote omitted).
In other words, don't wait for the final hammer to fall before formally objecting. We're not sure we agree with the court's analysis here, because before the 2008 notices of appropriation and filing of the maps and vesting of the title in the state, nothing was written in stone, and it appears to us that there was some chance the state and Amtrak would reach an agreement. "Common sense" tells us that it would have tainted the negotiations were Amtrak to have thrown down a lawsuit at that point, and perhaps the reasons it didn't file then wasn't that it was idly sitting on its rights, but rather (1) its property was still its property because the state had not taken the final act to vest title, and (2) it hoped that the ongoing negotiations might be successfully concluded short of a taking.
But the Second Circuit thought otherwise, so the prudent course is to file early and perhaps often. Landowners in these situations are put in a tough spot because invariably, if they do file suit as the Second Circuit requires, either for inverse condemnation or to stop a taking, the condemnor will argue that the case isn't ripe.
Sidebar: for an Amtrak-related post, see "'Shoot, Move & Communicate' En Route To The ABA Annual Meeting" about our adventures traveling cross-country on the train.
[To reserve your space, please email your RSVP to me or Mark, or call either of us at (808) 531-8031.]
On Thursday, March 5, 2015, from 6:00 - 7:15 p.m. at the Farrington High School Cafeteria (1564 North King Street, Honolulu, Hawaii), we're inviting property owners, businesses, and residents whose rights may be impacted by the Honolulu rail project to join us for an informational meeting about the rights of property owners when their property is targeted for acquisition for public transit projects, and how to protect those rights.
Here's the invite which we sent out:
Hawaii’s Constitution requires “just compensation” and monetary damages be paid if private property is taken for a public use such as the Honolulu rail project. The Honolulu Authority for Rapid Transit has already begun acquiring privately-owned property it needs for the rail corridor from the airport to Ala Moana, as shown in the video below.Landowners along the rail route have substantial rights that may be impacted. For background and a FAQ on Honolulu's rail project, see Clearing Up Myths About Hawaii Eminent Domain Law and the Rail. More here: All Aboard? Honolulu Rail is Coming.HART initially attempts to purchase property and other rights needed for the project by negotiation, but in the event it cannot reach an agreement with an owner about the compensation and damages it owes, HART has the authority to force immediate surrender of property by filing an eminent domain lawsuit against the owner, which allows a jury or a judge to determine the property’s value.
Please join Mark Murakami and Robert Thomas for an informational town hall meeting at which we will discuss the rail project, your rights as a property owner under Hawaii’s eminent domain law, and how you can protect your rights during the acquisition process. Here’s the location, date, and time:
- Location: Farrington High Cafeteria
- Address: 1564 North King Street (free parking)
- Date: Thursday, March 5, 2015
- Time: 6:00 – 7:15 p.m.
Topics we will cover will include:
- Can I prevent HART from taking my property?
- What rights do I have if HART wants to enter my property to survey and drill for soil testing?
- The valuation process: how is “just compensation” and damages calculated by the courts?
- HART’s offer does not adequately compensate me – do I have to wait for HART to sue?
- What are my rights as a landlord, a tenant, or a business owner whose property is taken by HART?
- I have a mortgage on my property. Does the lender have any claim?
- What are my rights if HART takes less than 100% of my parcel?
- What does the law require if my home or my business must be relocated as a result of the project?
We have also invited an appraiser to attend to discuss the appraisal process.
We and our law firm currently represent several landowners whose property is targeted by HART for the rail. We have also represented property owners in eminent domain and similar matters for many years. Mark was Best Lawyers' in America's "Best Lawyer of the Year in Eminent Domain and Condemnation Law" for Honolulu in 2013, and Robert shared this designation in 2014. Mark and Robert and their partner Ken Kupchak are listed in Honolulu Magazine's "Best Lawyers in Hawaii" and in Hawaii SuperLawyers in Eminent Domain and Condemnation Law.
While the format of the meeting will not lend itself to individual consultations, there will be a short session after our presentation to respond to general questions. Light refreshments will be provided. We hope you or a representative are able to join us.
Here are the cases which I spoke about this morning at the 2015 ALI-CLE Eminent Domain and Land Valuation Litigation conference:
- Brandt: Supreme Court benchslap on Rails-to-Trails
- Utah: You might have a public use problem if your only reason for taking excess property is that you wanted to avoid litigating severance damages
- Fourth Circuit: the Uniform Relocation Act is like the Pirate's Code: more like "guidelines" than actual rules
- More from the Fourth Circuit: Govt not necessarily off the hook for EAJA fees because it later upped its unreasonable pretrial offer
- Plaintiff: "Alliance for Property Rights and Fiscal Responsibility." Defendant: the City of Idaho Falls, Idaho. Court: Ninth Circuit. Any guesses who won?
- Pipeline through Kentucky is not a pipeline to Kentucky. If the Kentucky public doesn't benefit, maybe it's not for public use
Here is our annual "proof of life" photo, the view from the dais. Proof that despite the conference being held in beautiful San Francisco with its many distractions, we are all here (all 150+ of us) getting our eminent domain groove on.
Here are links to the cases and issues to watch:
- Horne v. USDA: California Raisins part II - the "world's most outdated law crashes headlong into takings (SCOTUS granted cert, merits briefing underway)
- Texas v. Clear Channel: is a billboard really "moveable" property? (case submitted to the Texas Supreme Court, decision pending)
- Property Reserve: pushing California's entry statutes too far (the merits briefing in the California Supreme Court has not been completed, but we will post the briefs filed so far in a separate post)
- Oregon: is common law highway access a property right, but one that's essentially worthless? (discretionary review pending in the Oregon Supreme Court)
- Hillcrest v. Pasco County: must a property owner challenge an illegal exaction for facial due process invalidity before he has standing to bring an as-applied challenge? (cert petition pending at SCOTUS)
One last photo: sitting on the dock of the Bay:
Here's the final program and faculty list for the 2015 Hawaii Land Use Conference, coming up Thursday and Friday, January 15-16, 2015, in downtown Honolulu.
This is the bi-annual gathering of Hawaii's land use mavens, and this year's program has two very special presenters. Storied lawprof Richard Epstein (perhaps more than a "mere mortal") will be presenting the keynote talk on "Stealth Takings: Exactions, Impact Fees and More," and our ABA colleague Patty Salkin, Dean of the Touro Law School, will get us our Ethics CLE credits with her usual exciting program on ethics topics. (As someone who has attended more than few of her presentations, we can report that it is worth the price of admission alone, and even though "ethics CLE" and "exciting" are words we usually do not associate with each other, Dean Salkin's presentation is the exception.)
Our panel on "Impact Fees and Exactions After Koontz" follows immediately after Professor Epstein's talk. The remainder of the agenda is equally good: transit-oriented development, GMO's, Endangered Species Act, form-based zoning, and more. If you are a Hawaii Land User, you shouldn't miss this.
The registration cost is the best value in CLE, a mere $200 for members of the Hawaii State Bar Association's Real Propertyand Financial Services Section and government attorneys, and $300 for everyone else.
There's still room, so please come and join us.
Here's the Washington Court of Appeals in City of Bellevue v. Pine Forest Properties, Inc., No. 71827-4-1 (Dec. 22, 2014):
Without question, condemnation of the property for construction of the East Link Project and the City's road improvement project is a public use.
Slip op. at 15. There's more detailed analysis in the court's 25 page opinion, of course, but you really didn't need to read more than the above, did you?
Registration is now open for the 2015 Hawaii Land Use Law Conference, to be held in downtown Honolulu on Thursday-Friday, January 15-16, 2015.
This is the bi-annual conference, co-chaired by U. Hawaii lawprof David Callies and land use lawyer Ben Kudo, that brings together the big names in our area of law. In other words, the one conference you don't want to miss if you are a Hawaii land use or property lawyer, in-house counsel, a planner, an appraiser, a property owner or manager, or a law student interested in these topics.
Download the full brochure here, or view it below.
The keynote speaker this year is lawprof Richard Epstein, addressing "Stealth Takings: Exactions, Impact Fees and More." Immediately following his talk, I will be moderating a panel on "Impact Fees and Exactions After Koontz," with colleagues Bruce Voss and David Brittin. The rest of the two-day agenda is equally interesting:
- State Districts/Boundary Amendments
- Native Hawaiian Rights
- Transit Oriented Development
- Critical Habitat Designation under the Endangered Species Act
- Legislative Update
- Form-Based Zoning
- GMO Regulation, Preemption, and Home Rule
We finish strong, with our ABA State and Local Government Law Section colleague Dean Patty Salkin of the Touro Law School, getting us those critical ethics credits. More details on the agenda and faculty here.
This just might just be the best deal in CLE: course registration fees for the two-day program start at $200 for RPFSS members, and government lawyers. There are many ways to join us:
Sponsored by the Hawaii State Bar Association's Real Property and Financial Services Section and the University of Hawaii Law School.
Look forward to seeing you there.
Posted on December 7, 2014 in ▪ Administrative law, ▪ Agriculture, ▪ Development agreements, ▪ Environmental law, ▪ Inverse condemnation, ▪ Land use law, ▪ Municipal & Local Govt law, ▪ Nollan/Dolan | Exactions, ▪ Penn Central, ▪ Rail, ▪ Regulatory takings, ▪ Seminars, ▪ Vested rights, ▪ Zoning & Planning | Permalink | 0 Comments
ALI-CLE, the good folks who put on the annual programs on Eminent Domain and Land Valuation, and Condemnation 101: How to Prepare and Present an Eminent Domain Case, have announced the dates and venue for the 2015 conferences:
Thursday - Saturday, February 5-7, 2015
Those of you who have attended or taught at these conferences in the past know they are the premier programs on this topic, and feature exciting presentations and excellent faculty.
I've been honored to be asked to serve as the Planning Co-chair of the 32d annual Eminent Domain and Land Valuation Litigation program, stepping into the able shoes of Leslie Fields, who retired last year. Joe Waldo is continuing as Planning Co-Chair. Joe and I are currently putting together the agenda and faculty for the program, and we will have more on that soon. Andrew Brigham and Jack Sperber are also hard at work assembling the next year's 101 program.
The Eminent Domain and Land Valuation Litigation program is designed for those with some familiarity with the fundamentals of eminent domain law, and is a chance to hear advanced presentations on some of the more cutting-edge issues in the area from the nation's most experienced condemnation lawyers and scholars. The 101 program is designed as an introduction to the fundamentals, and can be used to introduce lawyers new to the area to condemnation law, as a "refresher" for those who already have some experience, or as a primer before moving on to the Eminent Domain program.
Here are the 2014 agendas for the Eminent Domain and Land Valuation Litigation, and Condemnation 101 courses, to give you some idea about these conferences.
But for now, please mark your calendars and save the date so we can meet again in San Francisco.
Posted on June 20, 2014 in ▪ Articles and publications, ▪ Eminent Domain | Condemnation, ▪ Inverse condemnation, ▪ Just Compensation | Appraisal, ▪ Land use law, ▪ Municipal & Local Govt law, ▪ Nollan/Dolan | Exactions, ▪ Property rights, ▪ Public Use | Kelo, ▪ Rail, ▪ Rails-to-Trails, ▪ Redevelopment, ▪ Regulatory takings, ▪ Seminars, ▪ Uniform Relocation Act | Permalink | 0 Comments
Here are two recent reports on the progress of the Honolulu rail project that should be read in-tandem:
- Property acquisition for rail falls far behind (Star-Advertiser, June 15, 2014)
- City might seize land in Honolulu for rail line (Star-Advertiser, June 20, 2014)
Both stories are partially behind a paywall, but here's the relevant bits. The first story reports that HART, the city agency created to build and operate the rail is in "another race against time," this time to acquire the private property it needs to build the rail's easternmost stretch through Honolulu's urban core (the tough part, in other words). According to HART, acquisition of access is "our single highest priority." Which sounds like a big bite: HART Director "Grabauskas and HART staff say they're aiming to do some 18 months of work negotiating those properties in only six months' time. They intend to purchase approximately 146 full or partial properties in the heart of Honolulu by Dec. 15 to keep construction on track in 2015." Wow. But "'[w]e do not want to go through eminent domain if at all possible,' Grabauskas said last week."
However, in the second story, published today, the picture became more clear how HART could work through all these deals without using eminent domain. Short story: it likely can't, at least in part. The paper reports that "[a]cquiring properties in Honolulu to build Oahu's rail transit system could involve 'judicious' use of eminent domain." Ah, now we get it. We interpret this to mean that any negotiations will take place under the looming threat of eminent domain, and if the owner and HART cannot reach an agreement, then a condemnation complaint will likely be forthcoming lickety split. And, the lack of a final judgment in an eminent domain case likely will not slow down HART, as it could get immediate possession of the land (the "access" noted in the quotes above), even if the court has not made a final ruling on the amount of just compensation and damages owned to the property owner. More:
- Honolulu Rail Project Awarded $250 Million (Hawaii Reporter, June 20, 2014)
- Honolulu rail agency may spend another $5M for help with property acquisitions (Pacific Business News, June 18, 2014)
- Sitting in the train's parth: Landowners seek best deals (PBN, Apr. 4, 2014) ("Thomas said it is his job to make sure that his clients receive the most amount of money possible for their properties. But determining that full value can be tricky. Any property with an estimated value of at least $500,000 must undergo at least one appraisal, with two reviews. HART does not have its own appraisers — it hired Honolulu-based John Child & Co. And, of course, property owners can hire their own appraisers to assess the value of their properties.")
- Will Honolulu's rail transit system just be called 'The Train'? (PBN, June 18, 2014)
- Honolulu rail board report says CEO Grabauskas on the right track (PBN, June 19, 2014)
Since we're talking rail and eminent domain, we thought we would re-post an oldie but goodie, our responses to some of the myths we've heard surrounding the issue:
- Myth #1: HART will offer a "premium" to owners whose property it wants, because it needs those properties quickly. Wrong on two counts. First, the agency does not need to offer a premium since Hawaii law has a procedure by which a condemnor can take immediate possession of property it wants, "ex parte" (without notice to the landowner). Second, HART will only offer what it believes to be the amount legally required to be paid for "just compensation" and damage, not a penny more. Indeed, HART will claim it is fulfilling its obligation to the rest of the taxpayers when it offers you nothing more than its own valuation.
- Myth #2: The compensation offered and paid will include attorney's fees and costs. No, the Hawaii Supreme Court has held that the "just compensation" and damages required by the Hawaii Constitution to be offered and paid to property owners whose land is taken does not include attorney's fees and costs the landowner incurs if the property is taken. State v. Davis, 53 Haw. 582, 587, 499 P.2d 663, 687-88 (1972). In that case, the court held:
We hold in accordance with the overwhelming weight of authority that attorneys' fees and expenses, including expert witness' fees, are not embraced within the meaning of ‘just compensation’ for purposes of article I, section 18 of the Hawaii Constitution [currently article I, section 20].
Myth #3: I can use the deposit to pay my attorneys to fight the city's taking of my property. You can, but you've just "abandoned all defenses...except the sufficiency of the compensation or damage award." So if you take the money HART deposits when it grabs your property, you can't object to the fact that the city is taking your property, just the amount you will receive as compensation and damages.
- Myth #4: I can count on the city treating me fairly and making a reasonable offer. Good luck with that one. Read this summary by law professor and eminent domain expert Gideon Kanner and see if you still think that this is true.
- Myth #5: A property owner whose land is taken for the rail project can expect high valuation since the rail project will raise the value of properties near transit stations. Questionable. The city will no doubt claim the "scope of the project" rule requires a lower value. The rule says that increases or decreases in value after the scope of the project is known in the market can't be used to determine value of the property taken.
- Myth #6: I just appealed the city valuation of my property for property tax purposes saying it overvalued my home, but my claims of lower valuation can't be used against me in eminent domain. Oh yes they can. State law provides:
The valuation claimed by the taxpayer in any appeal regarding the assessment of real property tax shall be admissible in evidence as an admission of the fair market value of the real property as of the date of assessment irrespective of the fact that the assessed value from which the taxpayer appealed is adjusted to one hundred per cent fair market value...In the words of Joe Friday, "your words can and will be used against you in a court of law."
For you rails-to-trails fans, here's the latest from the Federal Circuit. In Biery v . United States, No. 13-5082 (June 2, 2014), the court held that interests which certain Kansas property owners conveyed to railroads back in the day were grants in fee simple, and some were grants of an easement.
The issue was dispositive because if the grants were in fee simple, then when the railroad abandoned railroad operations, the land could be converted to public recreational trail use without triggering a taking, but if the grants were easements, then upon abandonment, the owners should have got the land back, and are owed compensation.
As noted, in 2004, the stretch of rail corridor at issue was converted to a public trail pursuant to the Trails Act. If, prior to the conversion, the BNSF held fee-simple title to the land underlying the corridor, then, for their part, plaintiffs-appellants possess no compensable property interests. That is because the railroad’s fee-simple title would constitute complete ownership in the land. Tiffany Real Prop. § 27 (3d ed. 2013). If, however, the BNSF held only easements over the land, then plaintiffs-appellants retained a fee-simple interest in the land. Under those circumstances, if the BNSF’s conversion of the railroad tracks to a recreational trail was outside the scope of the easements and thus constituted abandonment, then the BNSF would have lost its interest because “if the beneficiary of [an] easement abandons it, the easement disappears, and the landowner resumes his full and unencumbered interest in the land.” Marvin M. Brandt Revocable Trust v. United States, 134 S. Ct. 1257, 1265 (2014) (citing Smith v. Townsend, 148 U.S. 490, 499 (1893)). In short, if plaintiffs-appellants hold fee-simple title to the land, they may potentially have a compensable property interest for purposes of a takings claim.
Slip op. at 4-5.
Applying Kansas property law, the court concluded that some of the owners granted easements, some granted the railroad fee simple title, while for others, the record was not developed enough to tell. Thus, some owners go back to the CFC for compensation, some go back to the CFC for more record-building, and some get shown the door.
Overall, an interesting decision on the history and real property law front, but not much there on the takings issues (yet).
For those of you who are members of the ABA, here's a tangible member benefit.
On Wednesday, April 9, 2014, tune in for a free webinar, "Rails-to-Trails and the Impact of Brandt Revocable Trust v. United States." The program is sponsored by the Real Property, Trusts & Estates Legal Education and Uniform Laws Group.
Here are the details:
We're registered, and you should too.
ABA-RPTE Professors’ Corner - A FREE monthly webinar featuring a panel of law professors, addressing topics of interest to practitioners of real estate and trusts/estates
This is a One Hour WEBINAR
Wednesday, April 9, 2014
12:30 pm Eastern / 11:30 am Central / 10:30 am Mountain / 9:30 am Pacific
Register online here.
March’s Program: “Rails-to-Trails and the Impact of Brandt Revocable Trust v. United States”
Professors’ Corner is a monthly webinar (on the second Wednesday of each month) featuring a panel of law professors, discussing recent cases or issues of interest to real estate or trust and estate practitioners and scholars.
- Professor Danaya C. Wright, University of Florida Levin College of Law
- Professor Michael Allan Wolf, University of Florida Levin College of Law
On March 10, 2014, the U.S. Supreme Court decided Brandt Revocable Trust v. U.S., involving the interpretation of the General Railroad Right-of-Way Act of 1875. The case involved a railroad right of way obtained in 1908, crossing land conveyed by the U.S. to the Brandt family in a 1976 land patent that did not specify what would happen if the railroad later relinquished its right of way (which occurred some years later). In the case, the U.S. sought to quiet title to the abandoned right of way, including the portion that crossed the land conveyed by the Brandt patent. Reversing the Tenth Circuit, which had affirmed a grant of summary judgment for the U.S., the Supreme Court held that the right of way was only an easement and was extinguished when the railroad abandoned it. The decision has already created some substantial consternation regarding its potential impact on the Rails-to-Trails movement and recreational trail development along abandoned rail corridors.
It's Friday, so we're slacking a bit on the blogging. But our colleagues at the Nossaman firm have given us a couple of good pieces for our reading enjoyment.
- First is "9th Circ. Simplifies Enviro Process For Transit Projects," by Robert D. Thornton. If his name sounds familiar, it's because he's the lawyer who represented the City and County of Honolulu in its succcessful defense of a federal lawsuit. The Ninth Circuit and the District Court recently sided with the City on the project (see our summary of the Ninth Circuit and the District Court rulings), and the plaintiffs have stated that they are not going to seek further review. In other words, this is probably the final substantive chapter in the major legal challenges to the Honolulu rail project. Mr. Thornton notes that the decision is one "of national importance for transit and highway projects" because it "recognizes that federal transportation agencies may (1) define a project's purpose and need and the range of alternatives based on the objectives described in an approved metropolitan transportation plan, and (2) narrow the range of alternatives based on prior state and local studies of project alternatives under certain circumstances." Worth reading.
- Rick Rayl and Brad Kuhn, who, with others, produce the California Eminent Domain Report, have written "2013 Eminent Domain Year in Review & 2014 Forecast," which runs down their view of the biggest cases of the year in our favorite area of law. Covers al the major cases. Good stuff. Read it.
Professor Richard Epstein shares his insight about the U.S. Supreme Court's recent 8-1 decision in Marvin M. Brandt Revocable Trust v. United States, No. 12-1173 (Mar. 10, 2014).
The issue in the case was whether the federal government retained an "implied reversionary interest" when it issued railroad patents to private landowners, or whether these grants were subject only to a railroad easement. The Court concluded they were easements, which means that they were extinguished when the railroad ceased using them as railroads.
Professor Epstein joined an amicus brief filed in support of the property owners in the case, which argued that a contrary ruling would violate "the special need for certainty and predictability where land titles are concerned."
Our friend Paul Schwind has been keeping us up to date on the progress, vel non, of the legal challenge to the Honolulu rail project in the United States District Court for the District of Hawaii. We last reported on the status of this litigation on February 18, 2014, when the Ninth Circuit issued its opinion dismissing plaintiffs’ appeal of the judgment and partial injunction in Honolulutraffic.com v. Federal Transit Administration, No. 11-0307 (D. Haw. Dec. 27, 2012).
To our mild surprise, the Ninth Circuit concluded it had appelalte jurisdiction, even though there was a colorable argument that the judgment and partial injunction entered by the District Court was not an appealable order, since at the time of the appeal (May 2013) and oral argument (August 2013), the defendants still had not yet reported their compliance with the judgment, the plaintiffs had not, as a consequence, had time to object in district court. That process played out during the latter part of 2013 and into early 2014. Paul previously reported on the District Court's judgment and partial injunction and the briefing in the Ninth Circuit.
Today, he returns to summarize what is probably Judge A. Wallace Teshima’s truly final order in the case: the Order on Objection to Notice of Compliance, which coincidentally (or perhaps not) was issued on the same day (February 18, 2014) as the Ninth Circuit opinion upholding his previous judgment in 2012. Although plaintiffs could, in theory, still seek Supreme Court review of this order and its accompanying Final Judgment, as a practical matter they appear to have little chance of prevailing in such an appeal. Plaintiffs acknowledged as much in the local media when they indicated they would now call a halt to their attempts to derail -- sorry, bad pun entirely intentional -- the rail project.
U.S. District Court's Honolulu Rail Compliance Order – A Slam Dunk
by Paul J. Schwind*
The multi-billion dollar Honolulu rail project finally appears to have clear track ahead to proceed with construction and real estate acquisition throughout its proposed alignment, including Phase 4 within urban Honolulu.
On February 18, 2014, the U.S. District Court for the District of Hawaii (Ninth Circuit Judge A. Wallace Tashima presiding by designation) granted the defendants (Federal Transit Administration [“FTA”], U.S. Department of Transportation [“DOT”], and City and County of Honolulu [“City”]) summary judgment as to all remaining claims of the plaintiffs (Honolulutraffic.com, Cliff Slater, Benjamin J. Cayetano, Walter Heen, Hawaii’s Thousand Friends, Small Business Hawaii Entrepreneurial Education Foundation, Randall W. Roth, Dr. Michael Uechi, and the Outdoor Circle), and vacated the court’s judgment and partial injunction entered on December 27, 2012.
That judgment and injunction had constituted the remedy for the court’s previous Order on Cross-Motions for Summary Judgment (November 1, 2012), which had found that defendants had failed adequately to study the project’s possible effects on Chinatown and Mother Waldron Park (an old urban park/playground), and had failed to articulate the reasons why a tunnel under Beretania Street (a major city arterial) was rejected. The judgment had also specified that the injunction would terminate 30 days after defendants filed a notice of compliance with the summary judgment order, unless plaintiffs objected.
Subsequently, the defendants produced a draft Supplemental Environmental Impact Statement (“SEIS”) in May 2013, and filed their Notice of Compliance together with a Final SEIS and Amended Record of Decision (“AROD”) on October 8, 2013, together with separate Declarations in Support. The plaintiffs did, of course, timely file an Objection on November 7, 2013, followed by a Reply in support of their Objection on January 17, 2014, in effect a surrebuttal to the federal and city defendants’ and intervenor’s separate Responses (see here (City), here (FACE), and here (FTA)) filed on January 6.
By this point, however, plaintiffs had limited their objection to defendants’ determination that the Beretania Street tunnel alternative was not a feasible and prudent avoidance alternative under § 4(f) of the Department of Transportation Act, 49 U.S.C. §303 (2006) (“section 4(f)”). Plaintiffs’ previous objections to defendants’ analyses of traditional cultural properties and constructive use of Mother Waldron Park having been withdrawn, and with the matter thus fully briefed, Judge Tashima heard oral argument on February 6, 2014, with the agreement of the parties that plaintiffs’ remaining objection regarding the tunnel alternative was a challenge to a final administrative action under the Administrative Procedure Act (“APA”), 5 U.S.C. §§ 701-706.
Plaintiffs’ argument, as presented by Nicholas C. Yost, centered on the standards set forth in Citizens to Preserve Overton Park v. Volpe, 401 U.S. 402 (1971), construing section 4(f) and 23 C.F.R. §774.17. That is, section 4(f) gives “paramount importance” to protecting parks and historic sites from being damaged by transportation projects. Public parks [and historic sites] are not to be lost unless alternative routes present “truly unusual factors” or “unique problems”, or the cost or community disruption of such alternatives reach “extraordinary magnitudes”; id. at 413. Public parkland [and historic sites] may not be used for a transportation project unless there is “no feasible and prudent alternative”, and “all possible planning” has been done to minimize harm; id. at 411 (emphasis added). Under section 4(f), a feasible and prudent “avoidance alternative” is required that "avoids using Section 4(f) property and does not cause other severe problems of a magnitude that substantially outweighs the importance of protecting the Section 4(f) property"; 23 C.F.R. § 774.17 (emphasis added). Under the APA, a reviewing court must also find that the selection of an alternative was not “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law”; Overton Park, 401 U.S. at 416.
Within this framework, Mr. Yost argued, the rail project as proposed (with an elevated line past the downtown area and a final destination of Ala Moana Shopping Center) will alter historic buildings and views from the Chinatown Historic District (a nationally protected area). These impacts must be compared with the impacts of the Beretania Street Tunnel alternative (which would run underground through most of downtown) and would have a final destination of the University of Hawaii (“UH”) campus (bypassing Ala Moana Center), while affecting the “obviously unattractive” King Street Florist building downtown, and the site of a Pensacola Street Station on the McKinley High School campus (of which the main buildings but not the rest of the campus are on the National Register of Historic Places). Both alternatives would impact the former Oahu Railway and Land (“OR&L”) terminus (a registered historic site), for construction of either a Ka`aahi Street Station or an Iwilei Station, or both. Mr. Yost argued further that both the project as proposed as well as the tunnel alternative have the UH campus as the ultimate destination, for only a two percent (2%) difference in final cost, as calculated from defendants’ figures. At this point Judge Tashima observed that with the tunnel alternative, there is no logical intermediate terminus (such as Ala Moana Center), and that there is no way to know the ultimate cost of reaching the UH campus without a lot more study. Mr. Yost concluded that defendants must show by comparison of the impacts of each alternative that they have chosen the one that will do the “least overall harm”, otherwise their selection is “arbitrary and capricious” and illegal under Overton Park as a “post-hoc rationalization."
Defendants’ argument, as presented first by Robert D. Thornton, for the City, began with the statement that there was no disagreement among experts in this case, as plaintiffs have none – instead, their attorney is “testifying” as to factual matters. In response to a concern of Judge Tashima, Mr. Thornton said that the issue is not an “apples to apples” comparison of how the rail system will reach the ultimate goal of the UH campus, or an “apples to oranges” comparison of whether to reach UH or Ala Moana Center, but rather: whether the recommended alternative meets the “purpose and need” of the project. (As set forth in the Draft SEIS, the purpose is to provide high-capacity rapid transit in the highly congested east-west transportation corridor between Kapolei and UH Manoa, to meet the need for improved corridor mobility, travel reliability, access to planned development, and “transportation equity”.)
The Beretania tunnel alternative is not prudent because it would (1) require the demolition of buildings at the former OR&L terminus for construction of a Ka`aahi Street Station, which otherwise would require an impossibly steep grade alignment; (2) require the construction of a Pensacola Street Station within the grounds of the historic McKinley High School; and (3) impact the King Street Florist building, which (even though a very humble structure) meets the criteria for eligibility for the historic site registry. The bottom line is, when all 47 sites affected by the original project and the tunnel alternative were consistently evaluated by the defendants’ experts pursuant to the seven factors specified under 23 C.F.R. §774.3(c)(1) (including meeting purpose and need, magnitude of adverse impacts, and substantial differences in cost), the preferred alternative (original project) was found to cause the “least overall harm”. Therefore, the court must defer to the agency’s (FTA’s) interpretation of its own regulations.
David B. Glazer for the FTA and DOT added that the agencies are not constrained to look only at historic buildings formerly designated in the National Register; they may take a larger, “whole-parcel” view of a site. For example, in the case of McKinley High School, it was appropriate to consider the impact of the tunnel alternative (Pensacola Street Station) on the front lawn of the campus.
William Meheula for the intervenors (Faith Action for Community Equity [“FACE”], Melvin Uesato, and Pacific Resource Partnership [“PRP”] stated that it was in fact reasonable to compare the cost of reaching Ala Moana Center vs. UH Manoa as termini of the project. Reaching Ala Moana meets the project’s purpose and need, whereas full build-out to UH Manoa is not funded, and there is no evidence that leaving the Beretania tunnel alternative short of the campus would meet purpose and need. It is therefore rational, and not arbitrary and capricious, that the defendants concluded as they did.
In rebuttal, Mr. Yost argued that a Pensacola Street Station would not be located on the McKinley High School grounds, and in any case there is a National Register boundary defined around the main school buildings, so the defendants do not have discretion to include the entire campus in their impact analysis.
Judge Tashima issued his Order (Honolulutraffic.com v. Federal Transit Administration, Civ. No. 11-0307 AWT (D. Haw. Feb. 18, 2014)) less than two weeks after oral argument.
First, he set forth the legal standard under which his order was reached. Given that the court’s review of agency actions under section 4(f) is governed by the APA, he looked to the relevant standard for “arbitrary and capricious” in Lands Council v. McNair, 537 F.3d 981, 987 (9th Cir. 2008) (en banc) (e.g., a decision contrary to the evidence or so implausible as to be beyond differences of expert opinion). “An agency has discretion to rely on the reasonable opinions of its own qualified experts even if, as an original matter, a court might find contrary views more persuasive.” Marsh v. Or. Natural Res. Council, 490 U.S. 360, 378 (1989).
Next, Judge Tashima determined that the Beretania Street tunnel alternative was not a feasible and prudent avoidance alternative (to the use of section 4(f) property), inasmuch as it would require use of the historic OR&L terminal site for construction of a Ka`aahi Street Station, which for valid engineering reasons could not be relocated further away from the OR&L parcel. Thus it was reasonable, and not arbitrary and capricious, for defendants to reject the tunnel as an avoidance alternative on these grounds alone. He then turned to defendants’ determination that the original project as proposed (and approved) does the least overall harm, inasmuch as it would cost $960 million less than the tunnel alternative and would cause less severe harm to section 4(f) properties and less disruption to non-4(f) resources.
Again, he found these determinations not to be arbitrary and capricious. The relevant comparison of alternatives was between the approved project (elevated rail line to Ala Moana) and the Beretania tunnel alternative (rail line to UH Manoa), which the court had previously ordered defendants to consider further. The defendants were not obligated to consider other alternatives cherry-picked by the plaintiffs to yield more favorable comparisons.
Finally, it was not arbitrary and capricious of the defendants to determine that the original project will cause less overall harm by use of “non-contributing” elements of several section 4(f) properties in Chinatown and downtown, in contrast to the tunnel alternative, which would require the removal, relocation, or alteration of historic buildings on the OR&L property. Additionally, the tunnel alternative would cause greater non-4(f) impacts in the form of construction-related disruption and delays due to roadway closures.
In sum, the defendants considered and balanced the relevant factors and important aspects of the problem, and did not offer implausible explanations contrary to the evidence; see N. Idaho Cmty. Action Network v. U.S. Dep’t of Transp., 545 F.3d 1147, 1152-53 (9th Cir. 2008).
Before granting defendants summary judgment on all remaining claims and vacating the prior partial injunction, Judge Tashima took this parting shot at both the plaintiffs and his colleagues on the federal bench in Hawaii, who had recused themselves in opposition to the elevated rail line running past their doorstep: “the [rail] Project would ‘not pose any additional threat to the Courthouse beyond that of surface traffic’ . . . Plaintiffs’ claim of increased safety risks to the U.S. Courthouse is unsupported by the record.” Order at 12.
*voluntarily inactive member of the Hawaii Bar
Here are some reports and commentary on the Supreme Court's opinion in Marvin M. Brandt Revocable Trust v. United States, No. 12-1173 (Mar. 10, 2014).
- Supreme Court Hands Down Disappointing Decision for Trails in U.S. (Rails-to-Trails Conservancy)
- Supreme Court rules for landowner disputing US claim to bike-trail right of way (ABA Journal)
- Family Trust Wins Supreme Court Fight Against Bike Trail (National Public Radio)
- Supreme Court Issues Landmark Ruling in Property Rights Case (NFIB - disclosure: we filed an amici brief with NFIB in support of the petitioner)
- Supreme Court to Government: Stop Railroading Property Owners (Cato at Liberty blog)
- U.S. Supreme Court upholds property rights in rails-to-trails case (Pacific Legal Foundation Liberty Blog)
- Court ruling in land dispute could threaten bike trails (USA Today)
- How the West Was Won: What Does the Brandt Decision Mean for Property Rights (NFIB)
- US Supreme Court Upholds Property Rights in Key Decision (Arent Fox)
As we predicted it would after oral argument, today the U.S. Supreme Court ruled in the property owner's favor in Marvin M. Brandt Revocable Trust v. United States, No.12-1173 (Mar. 10, 2014). Chief Justice Roberts wrote for the entire Court less Justice Sotomayor, who filed a solo dissent. SCOUTSblog posts a summary of the opinon here ("Victory - and money - for landowners").
As you might recall, the issue in the case was whether the federal government retained an "implied reversionary interest" when it issued these patents, or whether these grants were subject only to a railroad easement. The difference is that easements may be extinguished, while reversionary interests cannot. In this case, the railway abandoned its use, after which the federal government instituted a quiet title action in federal court asserting it owned the right of way, and that it did not revert to the property owner. As the opinion stated it:
This dispute turns on the nature of the interest the United States conveyed to the LHP&P in 1908 pursuant to the 1875 Act. Brandt contends that the right of way granted under the 1875 Act was an easement, so that when the railroad abandoned it, the underlying land (Brandt’s Fox Park parcel) simply became unburdened of the easement. The Government does not dispute that easements normally work this way, but maintains that the 1875 Act granted the railroads something more than an easement, reserving an implied reversionary interest in that something more to the United States.
Slip op. at 8.
The Court concluded that it was an easement, "in large part because it won when it argued the opposite before this Court more than 70 years ago, in the case of Great Northern Railway Co. v. United States, 315 U. S. 262 (1942)."
The Court then benchslapped the SG's argument that Great Northern was inapplicable: "[c]ontrary to this straightforward conclusion, the Government now tells us that Great Northern did not really mean what it said." Slip op. at 12. The next few pages were spent deconstructing that argument, concluding on pages 16 and 17 that the argument is filled with "irony," in that both Congress and the Government did an "about-face" and tried to change the law and the arguments, but "[t]hat policy shift cannot operate to create an interest in land that the Government had already given away." Slip op. at 17. The Court concluded:
More than 70 years ago, the Government argued before this Court that a right of way granted under the 1875 Act was a simple easement. The Court was persuaded, and so ruled. Now the Government argues that such a right of way is tantamount to a limited fee with an implied reversionary interest. We decline to endorse such a stark change in position, especially given "the special need for certainty and predictability where land titles are concerned." Leo Sheep Co., supra, at 687.
Slip op. 17. More on that point from lawprof Josh Blackman.
Now search as you might, today's majority opinion does not contain the words "takings" or "rails to trails." That's because neither was directly at issue. But make no mistake, this quiet title action was designed to deal with landowners who sued to recover just compensation when land that was supposed to come back to them after a railroad abandoned its operations was instead converted to recreational trails use. Thus, if successful, this case would have undermined an entire class of rails-to-trails takings cases in the Court of Federal Claims and Federal Circuit by legally wiping out the property interests that the owners claim was taken, a point we made in the amicus brief we filed in the case in support of the petitioners on cert and on the merits.
Unable to prevail on a variety of theories in rails-to-trails takings cases in the Court of Federal Claims (CFC) and the Federal Circuit for more than a decade, the Government appears to have switched tracks. Instead of continuing its fruitless frontal attacks on these takings claims—attacks which the courts have repeatedly rebuffed—the Government in this case has sought to undermine the very notion of property ownership by redefining the rights of way granted for railway uses under the 1875 Act from easements that are extinguished when no longer used for a railroad, to "implied reversionary interests."
The only allusion to those issues was in Justice Sotomayor' solo dissent, where she concluded:
Since 1903, this Court has held that rights of way were granted to railroads with an implied possibility of reverter to the United States. Regardless of whether these rights of way are labeled “easements” or “fees,” nothing in Great Northern overruled that conclusion. By changing course today, the Court undermines the legality of thousands of miles of former rights of way that the public now enjoys as means of transportation and recreation. And lawsuits challenging the conversion of former rails to recreational trails alone may well cost American taxpayers hundreds of millions of dollars.
Dissent at 8 (emphasis added).
Oh, that pesky Fifth Amendment.
Update 2/19/14: the Honolulu Star-Advertiser has this report ("The appellate court decision was an 'overwhelming victory for the city from an ideologically diverse panel, said Robert Thomas, a Honolulu-and San Francisco-based attorney who attended the hearing in August. The panel comprised Judges Stephen Reinhardt, Mary Schroeder and Andrew Hurwitz. 'All three of them agreed. They made pretty short work of the challengers' arguments on the merits' while spending much of the decision on the panel's jurisdiction concerns, Thomas said."). The Star-Advertiser also reported that the one issue remaining before the District Court was also (coincidentially) resolved yesterday against the challengers. Here is the court's order (we will have a report on that issue shortly).
Okay, we've got the obligatory "rail" pun out of the way with the title. On to the opinion, which we posted earlier today, which we've now had a chance to review it in more depth.
In HonoluluTraffic.com v. Federal Transit Admin., No. 13-15277 (9th Cir. Feb. 18, 2014), a three-judge panel of the Ninth Circuit unanimously concluded that the District Court entered an appealable order, thus making the case ripe for Ninth Circuit review. On the merits, the panel held that the FTA and the City did not go wrong when they did not adopt the "Managed Lanes Alternative" or the "bus rapid transit" alternative. Moreover, the FTA and the City made a "good faith and reasonable" effort to identify known archaeological sites and came up with a plan to deal with anything found during construction.
We attended the oral arguments in San Francisco last year (see our coverage here and here), and we concluded that two of the three judges were "very skeptical about whether there was an appealable final order in the case." We noted that it was a "fool's errand" to predict the outcome based on how judges seem to react at oral argument, but that there was a good chance that two of the judges were hung up on jurisdiction.
Well, it looks like we were right about at least one thing (no jokes about who is the fool, please), and all three judges agreed that the court of appeals had jurisdiction. It was Judge Schroeder who authored the opinion, and we at least guessed right that she thought there was an appealable decision. Looks like she convinced her two colleagues. Luckily, we offered no prediction about how the court was leaning on the merits.
It's a relatively short opinion (only 9 pages devoted to nonjurisdictional issues) which tells us that once the judges got past the jurisdictional question, they didn't have much doubt about whether the district court got it right about environmental law. That might explain why during oral arguments, the majority of the time the court spent questioning the lawyers was on the jurisdictional issue.
The panel rejected the challengers' main argument that the rail EIS was a "foreordained formality" because the project's objectives had been defined too narrowly. To the contrary, held the court, the purposes of the project in the environmental review documents were defined consistent with the goals for the project set out in the planning documents (see pages 17-18 of the slip opinion), and was broad enough to both comply with the statutory requirements, and to allow for more than one way to accomplish those goals. If you had any question about the City's vision of what the rail project is supposed to accomplish, look no further than the 45:20 mark of the oral argument video, where the City's lawyer asserts the purpose of the rail is to "reduce reliance on the private automobile," "promote smart growth land use policies," and "provide an equitable alternative for low-income populations and transit-dependent communities." And here you thought the rail was to reduce traffic.
The court also rejected the argument that the defendants had an obligation to consider alternatives previously rejected in the "screening process."
On the historic sites issue, the panel made short work of the challengers' arguments, holding that it was not necessary to evaluate the entire proposed route in order to evaluate part of it:
In this case, Defendants did not conduct Archaeological Inventory Surveys (“AIS”) to identify undiscovered burial sites along the entire twenty-mile length of the Project prior to its approval, even though it is likely that construction may disturb some of such sites.
Slip op. at 24. Federal law only requires a "reasonable and good faith effort" to identify burial and other archaeological sites, and the panel concluded there was "good reason for Defendants' reluctance to conduct the surveys," since the "exact route and placement of the support columns had not yet been determined." Id. Compare this ruling with the Hawaii Supreme Court's earlier opinion that under state law, the State Historic Preservation Division wrongly "concurred in the rail project prior to the completion of the required archaeological inventory survey for the entire project." But different jurisdictions, different law.
What's next? With a short opinion and no dissent, we think it unlikely that the Ninth Circuit would rehear this case en banc. But what do we know, since we were wrong about the panel's leanings on the jurisdictional issue, and the plaintiffs in this case have been very tenacious.
Update: a deeper review of the opinion here.
The Ninth Circuit has affirmed the District Court's decision upholding for the most part the environmental review of the Honolulu rail project. Here's the summary from the court:
The panel affirmed the district court’s dismissal of plaintiffs’ claims under the National Environmental Policy Act and Section 4(f) of the Department of Transportation Act arising from litigation challenging the construction of a highspeed rail project in Honolulu, Hawaii.The panel held that it had appellate jurisdiction under either 28 U.S.C. § 1292(a)(1), as an appeal from the grant or refusal of injunctive relief, or 28 U.S.C. § 1291, as an appeal of a final judgment. The panel also held that the Environmental Impact Statement’s identification of the project objectives, and analysis of alternatives, satisfied the National Environmental Policy Act’s requirements. The panel further held the defendants did not violate Section 4(f) of the Department of Transportation Act where the defendants did not adopt a Managed Lanes Alternative or bus rapid transit alternative, and where defendants made a good faith and reasonable effort to identify known archeological sites along the proposed project route and developed an appropriate plan for dealing with such sites that may be discovered during construction.
More to follow after a chance to digest the opinion.
Hey, that rhymes! Today, in a not-entirely-unexpected move, the U.S. Supreme Court granted cert and agreed to review United States v. Brandt Revocable Trust, No. 09-8047 (Fed. Cir. Sep. 11, 2012).
We say not-unexpected for two reasons. First, the Tenth Circuit expressly noted its ruling created a circuit split (that's catnip to counsel considering a petition). Second, the Solicitor General did not oppose the petitition, but agreed that it should be granted to resolve the split in the government's favor.
The issue in the case is whether the federal government retained an "implied reversionary interest" when it issued these patents, or whether these grants were subject only to a railroad easement. The difference is that easements may be extinguished, while reversionary interests cannot. In this case, the railway abandoned its use, after which the federal government instituted a quiet title action in federal court asserting it owned the right of way, and that it did not revert to the property owner.
Disclosure: we filed an amicus brief in the case supporting the petition. Our brief argues that the case was an attempt to undercut takings claims in which the plaintiff's rights are based on a patent subject to the 1875 Act, since the government's track record in the Court of Federal Claims and the Federal Circuit isn't very good. Because it has been unable to prevail on a variety of theories in rails-to-trails takings cases in the CFC and Federal Circuit for more than a decade, the government appears to have switched tracks. Instead of continuing its fruitless frontal attacks on these takings claims—efforts that repeatedly have been rebuffed by the courts—the Government in this case has sought to undermine the very notion of property by redefining the "rights of way" granted for railway uses under the 1875 Act from easements that are extinguished when no longer used for a railroad, to "implied reversionary interests." Our brief argues that the government's strategy to redefine property rights based on the 1875 Act will virtually wipe out an entire class of takings claims without justification.
Programming note: the case formally being reviewed is the Tenth Circuit's opinion in the government's quiet title action, and not the Federal Circuit's opinion in a related case as reported by SCOTUSblog (Brandt's claim for compensation, Brandt Revocable Trust v. United States, 710 F.3d 1369 (Fed. Cir. 2013)), which held that a takings claim originally submitted as a compulsory counterclaim to the federal government's attempt to quiet title in a District Court action -- which was then subsequently filed as a separate action in the CFC -- was not barred by 28 U.S.C. § 1500. But maybe the Supreme Court will do a "two fer" and resolve both issues?
The federal government has filed its brief responding to the cert petition which asks the Supreme Court to review a Tenth Circuit decision and resolve a lower court split about the meaning of the term railroad "right of way" as used in an 1875 federal statute and federal land patents subject to the 1875 Act.
The issue is whether the federal government retained an "implied reversionary interest" when it issued these patents, or whether these grants were subject only to a railroad easement. The difference is that easements may be extinguished, while reversionary interests cannot. In this case, the railway abandoned its use, after which the federal government instituted a quiet title action in federal court asserting it owned the right of way, and that it did not revert to the property owner.
Disclosure: we filed an amicus brief in the case supporting the petition. Our brief argues that the case was an attempt to undercut takings claims in which the plaintiff's rights are based on a patent subject to the 1875 Act, since the government's track record in the Court of Federal Claims and the Federal Circuit isn't very good. Because it has been unable to prevail on a variety of theories in rails-to-trails takings cases in the for more than a decade, the government appears to have switched tracks. Instead of continuing its fruitless frontal attacks on these takings claims—efforts that repeatedly have been rebuffed by the courts—the Government in this case has sought to undermine the very notion of property by redefining the "rights of way" granted for railway uses under the 1875 Act from easements that are extinguished when no longer used for a railroad, to "implied reversionary interests." Our brief argues that the government's strategy to redefine property rights based on the 1875 Act will virtually wipe out an entire class of takings claims without justification.
The government's brief doesn't challenge those arguments, made in our brief and the other amicus briefs (see also here) filed supporting the property owner. Indeed, the government's brief agrees there is a circuit split, and that the Court should grant cert and resolve it. The only dispute is on the underlying merits, and the government seems to have doubled down on its strategy: it now wants to wipe out these type of takings claims nationwide, and not just in the Tenth Circuit:
As petitioners note (Pet. 32-33), and as the court of appeals (Pet. App. 5-6) and the district court (id. At 26) recognized, the decision below conflicts with the Federal Circuit’s decision in Hash v. United States, 403 F.3d 1308 (2005), which held, in the context of a suit seeking
just compensation for a taking under the Fifth Amendment, That the United States did not “retain” a “reversionary interest to the land underlying [1875 act] rights of-way after disposing of the land by land grant patent under the Homestead Act.” Id. At 1318. Moreover, the Seventh Circuit has, in dictum, concluded that Hash "make[s] better sense than [the Tenth Circuit's decision in] Marshall.” Samuel C. Johnson 1988 Trust v. Bayfield Cnty., 649 F.3d 799, 803 (2011). By contrast, the Ninth Circuit has, in dictum, agreed with Oregon Short
Line that Section 912 applies to rights-of-way granted “both before and after 1871.” Vieux v. East Bay Reg’l Park Dist., 906 F.2d 1330, 1335, cert. denied, 498 U.S. 967 (1990). There is also disagreement in state courts of last resort.. . . .Whether the United States has reversionary interests in 1875 Act rights-of-way is a question of sufficient importance to warrant this Court's review.. . . .To date, thousands of claims pertaining to 1875 Act rights-of-way have been filed. Under current Federal Circuit precedent, the United States will be obligated to pay just compensation on many claims in which ownership of the right-of-way is often a determining factor. Those claims could impose considerable financial liability on the United States and the public fisc, making it appropriate for this Court to review whether the United States holds a reversionary interest in an 1875 Act right-of-way.
Brief at 17-20.
The petitioner has declined to file a response, and the case will now be placed on the Court's calendar for consideration. Stay tuned, folks.
Here are links to the cases and other materials (and more) we spoke about at today's conference on Eminent Domain and Condemnation in Hawaii:
- Ilagan v. Ungacta (Guam v. 162.40 Square Meters of Land)
- Ilya Somin, The Judicial Reaction to Kelo, 4 Alb. Gov't L. Rev. 1 (2011)
- Ilya Somin, The Limits of Backlash: Assessing the Political Response to Kelo, 93 Minn. L. Rev. 2100 (2009)
- "Solely" for economic development? Missouri ex rel. Jackson v. Dolan
- NJ: Dunes That Protect Everyone Get Paid For By A Few - more analysis of the case here from Anthony Della Pelle, New Jersey Condemnation Law blog
- Another one from PA: Offer to Buy Is Admissible In Compensation Trial
- Case to watch: SCOTUS Considering Whether Condo Assessments Are "Property" Entitled to Compensation in Eminent Domain
- Texas trilogy: Whittingthon, Heart's Bluff, Enbridge
- Pipeline takings: Colorado
- Pipeline takings: Montana
- Pipeline takings: Texas
- Is eminent domain abuse outrageous government conduct? Not according to the Second Circuit (49 Wb v. LLC v. Village of Haverstraw)
- Takings and the Equal Footing Doctrine (United States v. 32.42 Acres of Land)
- What is "aboriginal land" immune from eminent domain? (Miccosukee Tribe of Indians of Florida v. Dep't of Environmental Protection)
- Takings in Indian Country, part II (Grand Canyon Skywalk Dev. LLC v. Sa Nyu Wa, Inc.)
Also, here are links to a few of our stories on the Honolulu rail project and the many legal challenges:
- Some thoughts about the Ninth Circuit arguments (with video)
Update: More here from the Star-Advertiser.
Courts, as "temples of justice" can be intimidating places, especially for the advocates who appear there. And when you make it a federal court, the level goes up. And when you are in a storied courthouse such as the Ninth Circuit's headquarters in San Francisco surrounded by corinthian columns, cherub statues, and a ceiling full of stained glass, it certainly can be a heady experience.
Today was no different as a three-judge panel of the Ninth Circuit heard oral arguments in the federal environmental challenge to Honolulu's multi-billion-dollar heavy rail project. The panel, comprised of Judges Stephen Reinhardt and Andrew Hurwitz, and Senior Judge Mary Schroeder, was "hot," and for the most part kept firing questions at the three advocates over the course of the nearly hour-long arguments. As we noted in our initial post-argument report, the panel spent the overwhelming majority of its time on the jurisdictional issue (see here for Paul Schwind's detailed preview of the arguments, which includes a section on why the federal agencies and the City and County of Honolulu assert that this appeal is premature). And although we cautioned that it's hard to predict the outcome of an appeal based on the questions judges ask at oral argument, we threw caution to the wind and surmised that the appeal had a good chance of being dismissed for lack of appellate jurisdiction, with perhaps Judge Schroeder dissenting.
What drove us to that conclusion was not only the amount of time the court spent on the jurisdictional questions, but the fact that whenever one of the advocates attempted to shift away to the substantive issues of whether the EIS was adequate, the judges' questions seemed to dwindle, and they eventually circled back to the jurisdictional issue. To us, this indicated the question on the judges' minds was whether there was a final, appealable decision by the District Court. We concluded that at least two of them were not convinced there was.
We won't do a blow-by-blow of the arguments because the Ninth Circuit has done us a favor by posting the video on YouTube. But here are what we see as the highlights:
- The appellants' attorney started off strongly with his basic theory of the case. "This case is the very paradigm of how not to do 4(f) under NEPA." It wasn't long, however, before the judges started in with their jurisdictional inquiry. As we noted above, they didn't seem all that interested in the substantive merits of the case, in our view. Each time the appellants' attorney tried to get them off that subject, it seemed they didn't want to leave.
- While there was some back-and-forth discussion about whether the practicalities of the posture of the case would overwhelm the legal issues -- the appellants' lawyer repeatedly argued that the court should review the issues on appeal because if it does not, the city will move forward with construction on the other phases of the project and thus render any future decision on the issues fait accompli -- Judges Reinhardt and Hurwitz didn't seem to be particularly bothered by that aspect. As presumably left-leaning judges (Reinhardt is reputed to be the most "liberal" judge on the federal appellate bench, and Hurwitz is a fairly recent Obama appointee), we'd guess they are quite willing to take the City and the federal appellees at their word when they said that there's little danger of such an argument being made in the future. Trust in government seemed high from those two judges. They also seemed a bit bothered by the fact that the appellants had not sought some kind of relief pendente lite, to prevent the other parts of the project not on appeal from moving forward while this part (maybe) is resolved. And it seemed to satisfy them that the declaratory-ruling-that's-not-quite-an-injuction issued by the Hawaii Supreme Court in the state court challenge to another aspect of the project means that there's no rush to build.
- For the City's theory of the case, fast foward to the 42:45-mark of the video, where the City's lawyer asserts that the appellants "flatly mischaracterized the record" when they assert that the City has not looked at any alternatives other than steel-on-steel heavy rail.
- If you had any questions about the City's vision for the rail project, look no further than the statement by the City's lawyer at the 45:20 mark where he asserts the purpose of the rail is to "reduce reliance on the private automobile," "promote smart growth land use policies," and "provide an equitable alternative for low-income populations and transit-dependent communities." And here you thought the rail was to reduce traffic.
- One more factor to add in: this is an unusual case in that the District Court decision was made by another Ninth Circuit judge, A. Wallace Tashima, who is hearing the case at the district court level because the entire Hawaii District Court bench recused itself because the rail is planned to run by the courthouse. Will the fact that Judge Tashima's colleagues are reviewing his decision make them more likely to defer to it? We're not sure, but it does add an interesting twist on the deliberations.
Now we wait. When the court decides what to do -- whether its an order dismissing the appeal or an opinion on the merits -- we'll bring it your way.
We just finished up with the oral arguments at the Ninth Circuit courthouse in San Francisco. We'll have a more detailed report later today, but our initial reaction is that it looks like at least two of the three judges are very skeptical whether there was an appealable final order in the case, and thus may be ready to dismiss the appeal for lack of jurisdiction. One judge seemed to understand and accept the appellants' jurisdictional arguments, so if the court dismisses, we may see a dissent.
Of course, with appellate arguments it's always a fool's errand to predict the outcome based on oral argument (but that doesn't stop us from doing it, does it?), so we may be totally off the mark. But when the court spends 95% of the time talking jurisdiction and not the merits, if you are the appellants' lawyer, you must have your doubts.
More to follow soon. Update: here's our more complete analysis of the arguments.
(Yes, the above photo accurately reflects that we were sitting on the courthouse steps while writing up this post.)
Here's the latest from the New Jersey Supreme Court on the power of railroads to take property, and when land is already being put to a "prior public use" and thus immune from being taken.
In Norfolk Southern Railway Co. v. Intermodal Properties, LLC, No. A-117-11 (Aug. 6, 2013), the court held that the railroad had the power to condemn an adjacent parcel already used as a parking facility to expand its rail facility to, among other benefits, provide more parking space. It's a long opinion (42 pages) so we won't go into it in great detail, so here's the short version.
The court held that the statutory requirement that a railroad's condemnation be "not incompatible with the public interest" was met. Although the taking was for parking and the property taken was already being used for parking by its owner, this did not qualify as a prior public use because the parking was not public. Moreover, the owner Intermodal did not have the power of eminent domain, and an owner invoking the doctrine must have the power.
The court also held that New Jersey's statutes, which give railroads the power of eminent domain in circumstances "as exigencies of business may demand," means that they may take property as the needs arise in the ordinary course of business. The court found the current use of the term (emergency, urgent, or immediate) are not consistent with the way the word "exigency" was used when the statute was adopted more than a century ago, and it is the meaning of the words at adoption that control.
There's a lot there in the opinion, although most of it deals with the details of New Jersey's statutory requirements. But it is a good primer on the prior public use doctrine so is worth reviewing just for that alone.
Our friend and colleague Paul Schwind brings us up to date on the status of the state court legal challenge to the Honolulu rail project, last reported on here.
A reminder: Paul and I will be presenting a session on the latest in the rail project (including happenings in both state court and the Ninth Circuit) at the upcoming Eminent Domain and Condemnation Law Conference (Honolulu, Aug. 21, 2013). Hope you can join us.
by Paul J. Schwind*
So far there have been two attempts by the parties in the state court rail litigation to have the Hawaii Supreme Court reconsider its opinion vacating and remanding to Circuit Court for further proceedings. See Kaleikini v. Yoshioka, 128 Haw. 53, 283 P.3d 60 (2012). The City and State appellees tried last year and were denied on September 27, 2012. Then the appellant, Paulette Kaleikini, tried this year and was denied on May 17, 2013. She then moved the Circuit Court on May 23 for summary judgment. Since documents in Hawaii’s trial courts are not readily available electronically, we do not know the content of her motion. But it is likely that on remand, she moved for judgment in her favor on the counts previously decided against her that were vacated by the Supreme Court. Argument on this motion was calendared to be heard by First Circuit Judge Gary W. B. Chang on July 9 at 3:00 p.m., but on June 19, Kaleikini filed a notice of withdrawal of her motion, and filed a stipulation and order instead. Presumably that ends her litigation against the rail, at least for the time being.
Hawaii Supreme Court Summary
The Supreme Court’s own summary of the case, now published, provides a succinct overview of the issues decided on appeal under Hawaii’s historic preservation law, and the rationale for the Court’s opinion:HRS chapter 6E is Hawaii's historic preservation law. The Department of Land and Natural Resources, through its State Historic Preservation Division (SHPD), is the agency tasked with promulgating the rules to carry out this law, and with implementing these rules.
In the instant case, the SHPD failed to follow its own rules when it concurred in the rail project prior to the completion of an archaeological inventory survey for the entire project. As explained below, the rules establish a sequential process under which an archaeological inventory survey must precede the SHPD's concurrence in a project. As noted in the rules, “[t]he review process is designed to identify significant historic properties in project areas and then to develop and execute plans to handle impacts to the significant properties in the public interest.” HAR § 13–275–1(a) (emphasis added). Moreover, the broad definition of the term “project area” contained in the rules encompasses the entire rail project, and does not permit the SHPD to consider the rail project in four separate phases for the purposes of historic preservation review.
In contrast to the requirements of the rules, the rail project's Programmatic Agreement provides for the completion of archaeological inventory surveys after the SHPD has provided its concurrence in the project. Nevertheless, the City and State have argued that the Programmatic Agreement constitutes an “interim protection plan,” which would allow the rail project to commence absent completion of the full historic preservation review process. Although the City and State are correct that the rules permit a project to commence where an “interim protection plan” is in place, a plain reading of the rules indicates that the Programmatic Agreement is not an interim protection plan. When viewed in context, it is apparent that an interim protection plan is a form of mitigation that, under the sequential approach of the rules, can be developed only after an AIS has been completed.
In sum, the SHPD failed to comply with HRS chapter 6E and its implementing rules when it concurred in the rail project prior to the completion of the required archaeological inventory survey for the entire project. The City similarly failed to comply with HRS chapter 6E and its implementing rules by granting a special management area permit for the rail project and by commencing construction prior to the completion of the historic preservation review process.Accordingly, we vacate the circuit court's judgment on Counts 1 through 4 of Kaleikini’s complaint, which challenged the rail project under HRS chapter 6E, and remand to the circuit court for further proceedings on those counts. We affirm the circuit court's judgment in all other respects.
Id. at 57, 283 P.3d at 64.
Along the way, the Court held that Kaleikini had made a sufficient showing of “irreparable injury” to Kakaako burial sites; the final EIS was not required to contain an AIS; and the City and State gave full consideration to cultural and historic values as required under HRS chapter 205A for the issuance of an SMA permit. In the Court’s concluding words:
For the foregoing reasons, the circuit court erred in granting summary judgment in favor of the City and State on Counts 1 through 4 of Kaleikini’s complaint, because the rules implementing HRS §§ 6E–8 and 6E–42 do not permit the SHPD to concur in the rail project absent a completed AIS for the entire project. However, the circuit court properly granted summary judgment in favor of the City and State on Counts 5 and 6 because (1) the final EIS was sufficient under HRS chapter 343 and was properly accepted by the Governor; and (2) the City and State gave full consideration to cultural and historic values as required under HRS chapter 205A.Accordingly, we vacate the circuit court's judgment on Counts 1 through 4, and remand for further proceedings. However, we affirm the circuit court's grant of summary judgment in favor of the City and State on Counts 5 and 6.
Id. at 88, 283 P.3d at 95.
Statutory Amendment - Act 85
In a new twist in the case, Hawaii’s historic preservation law (HRS chapter 6E) was just amended on May 21 by Act 85 of the 2013 Legislature (SB 1171 SD1 HD2) to define “programmatic agreement” and to permit “phased review” of projects where such an agreement exists and a project consists of corridors or large land areas, where access to properties is limited, and “circumstances dictate that construction be done in stages”. In other words, although this legislation is not intended to have retroactive application, it appears that in the future, another large project could perhaps be legally phased under the historic preservation law, consistent with Federal regulations (36 C.F.R. § 800.4(b)(2)), if not also “segmented” under Hawaii’s environmental impact law (HRS chapter 343).
*voluntarily inactive member of the Hawaii Bar
What's the difference, if any, between a "cemetery" and a burial, and are burials in cemeteries exempt from archaeological review? That's one of the issues the Hawaii Supreme Court agreed to review in this Order, by which it accepted the DLNR's application for a writ of certiorari.
In Hall v. Dep't of Land and Natural Resources, No. 12-0000061 (Dec. 14, 2012), the Intermediate Court of Appeals held that a development proposed by the historic Kawaiahao Church in Honolulu is not exempt from historic preservation review, and the state should have required the preparation of an archaelogical inventory survey prior to the State Historical Preservation Department's check off on the project, even though the development is located in the Church's cemetery.
The DLNR's application posed the following Questions Presented:
Defendant-Appellee Kawaiaha‘o Church (the "Church") is attempting to construct a multi-purpose building ("MPC Project") on its grounds for use in furtherance of its religious mission. The site of the MPC Project is located on cemetery grounds of the Church property. The Intermediate Court of Appeals (“ICA”) ruled that regardless of whether the site was considered a cemetery, an archaeological inventory survey ("AIS") was required; therefore, the Court ruled that the Department of Land and Natural Resources’ ("DLNR") State Historic Preservation Division ("SHPD") "violated its own rules in failing to require an AIS before permitting the project to go forward." In reaching its decision, the ICA relied in large part on this Court’s recent decision in Kaleikini v. Yoshioka, 128 Haw. 53, 283 P.3d 60 (2012).The State requests this Court review the following issues:1. That the ICA gravely erred when it ruled that an AIS was required before SHPD could concur in the MPC Project.2. That the ICA gravely erred in ruling that it was irrelevant whether the MPC Project site was a cemetery.3. That the ICA gravely erred when it ruled that Kaleikini v. Yoshioka, 128 Haw. 53, 283 P.3d 60 (2012) was applicable to the instant case.4. That the ICA gravely erred by failing to recognize the State’s sovereign immunity (and failing to follow this Court’s controlling ruling on the issue) when it granted attorney’s fees and costs in favor of Respondent-Plaintiff-Appellant Dana Naone Hall ("Plaintiff") and against the Church and the State jointly and severally pursuant to the private attorney general doctrine.
Application at 2-3 (footnote omitted).
Whether the court will be issuing a ruling on all of these issues or just some of them, we don't know. All we can do now is wait for a decision (the court ordered that no oral argument would be held, meaning that the case won't get a hearing unless one of the parties successfully moves for retention).
He's also the Chair-Elect of the ABA State & Local Govt Law Section, and former Chair of the Section's Eminent Domain Committee
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Hawaii Member OCA
All upcoming and past seminars, conferences, and events here
At the 2016 Brigham-Kanner Property Rights Conference in the Hague, The Netherlands (October 19-20, 2016, I'm speaking on two panels: "Property's Role in the Fundamental Political Structure of Nations," and "Defining and Protecting Property Rights in Intangible Assets." More information here.
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