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News & Developments

 

January 18, 2012

Obama Says No to TransCanada Keystone XL Pipeline—For Now

In early January, TransCanada announced it had mapped and studied a new route through Nebraska for the XL pipeline, avoiding the troublesome parts of the Nebraska Sandhills. TransCanada indicated it was working on a fast track with the Nebraska Department of Environmental Quality for approval of the new routing. However, it will not be so fast after all.

Facing a February 21, 2012, deadline imposed by Congress, Secretary of State Hillary Clinton announced on January 17 that she was recommending denial of the permit to build the pipeline, and President Obama then announced that the permit would be denied. The reasoning was that it would not serve the public interest to approve a permit for a pipeline while environmental and routing issues remain unresolved. The decision leaves the door open to renew the permitting process with the State Department after the rerouting has been completed, and TransCanada is already talking about a timeline for doing so. Chances are good it will not happen before the November election.

The president’s supporters are already applauding his commitment to saving the environment, while opponents are already complaining that the president has stopped a project that would create 20 thousand American jobs and strengthen our oil supply. Property owners along the original route who have signed easements and have been paid for those easements are already calling attorneys for assurance that they get to keep the money.

— William G. Blake, Baylor, Evnen, Curtiss, Grimit & Witt, LLP, Lincoln, NE

November 23, 2011

Miss. Voters Approve Limits on Transfers of Condemned Property

After several failed attempts to pass eminent-domain reform through the Mississippi legislature, proponents of reform successfully passed ballot Initiative 31, amending the Mississippi constitution to limit the state’s ability to transfer property acquired through eminent domain to private parties. Specifically, the measure prohibits the state from transferring to any private party any interest in property acquired through eminent domain for a period of 10 years after acquisition. The measure does carve out express exceptions, however, for virtually all current uses of eminent domain, including condemnation of roads, utility rights of way, airports, blighted properties, etc.

The largest immediate impact of the initiative is that it invalidates the use of eminent domain under Mississippi’s Major Economic Impact Act. This legislation allowed for the use of eminent domain to acquire property for high-economic-impact projects, i.e., projects involving a capital investment of $300 million or projects involving a capital investment of $150 million plus the creation of 1,000 jobs.

Like other reforms passed in other states, this measure grew from dissatisfaction with the U.S. Supreme Court’s ruling in Kelo v. City of New London. Earlier efforts at reform had either failed in the legislature or had been vetoed by the governor. Further, because the Mississippi constitution vested the power to determine public use solely in the courts, any legislative reform would likely have been invalidated.

— Alan Windham, Balch & Bingham LLP, Jackson, MS

November 16, 2011

The TransCanada XL Pipeline Is Routed Around the Sandhills

In a surprise announcement in the Nebraska legislature’s chamber on November 14, 2011, TransCanada announced that the controversial XL crude-oil pipeline will not be built through the Nebraska Sandhills.

Instead, it will be routed to the east, around the sandhills and away from the Ogallala aquifer. The aquifer supplies drinking and irrigation water to much of the Great Plains region, and the potential environmental damage resulting from an oil spill above the aquifer have sharply divided the region.

Pressure continued to mount on both sides, as union workers and business owners lined up on one side of the street to picket in favor of the pipeline, and environmentalists and ranchers lined up on the other side to protest against the pipeline.

The governor called the legislature into special session to adopt legislation for state regulation of pipeline routing. The president announced that he would make the final decision on whether the pipeline could be built, and the State Department then ordered TransCanada to explore a route that will not go through the Sandhills. Radio and television advertisements about the pipeline were running every few minutes. Finally, the State Department confirmed that the state has sitting authority and that the state could participate in an expedited new environmental-impact study if the route is moved. After all this, the announcement was made on the floor of the legislature by the speaker, that “I have visited with TransCanada and they have agreed to voluntarily move the route out of the Nebraska Sandhills.”

The new route is not yet determined, but may not involve more than a 30 to 40 mile curve around the vulnerable area. The new environmental-impact study is expected to take at least six months, with identification property acquisitions and negotiations extending the delay. In the meantime, TransCanada remains without a permit from the State Department.

— William G. Blake, Baylor, Evnen, Curtiss, Grimit & Witt, LLP, Lincoln, NE

September 15, 2011

In South Carolina, an Attorney's Time Is Property

Mr. Howard was charged with numerous serious felonies, and Mr. Brown was appointed by a South Carolina judge to defend Howard. South Carolina law limits attorney fees for such appointments to $3,500, subject to the judge’s discretion. Brown found himself spending “substantial amounts of time” defending Howard, and asked to withdraw. The judge refused, and Brown asked again. The judge refused again, calling Brown “belligerent.” Brown then refused, but he backed down when the judge threatened him with contempt.

After trial, Brown asked the judge to exercise the court’s discretion and award fees in excess of the statutory $3,500. The judge declined, noting Brown’s lack of cooperation and lack of respect for the court. Brown appealed.

The South Carolina Bar appeared as amicus; arguing that conscripting an attorney’s services for the public good implicates the takings clause. The court agreed, but declined to set any bright-line rules and left it to the trial courts for case-by-case determination of “what constitutes a fair attorney’s fee.”

As for Brown, the court found that the trial judge had not abused his discretion, given the egregious level of inexcusable conduct by Brown.

EDITOR’S NOTE: Where do we start?

1. This is fun reading, and provides two good reminders to every trial attorney: 1) The judge is the judge, and you are not; 2) You probably will not be rewarded for childish behavior.
2. If time is property, where does any constitution say your property can be taken without just compensation as a result of bad behavior?
3. Why is the case styled Brown v. Howard?
4. Why was an amicus allowed to raise issues not raised by a party?

September 14, 2011

Virginia Allows Compensation for Movable Fixtures and Equipment

In a ruling that will affect compensation arguments in numerous condemnation cases, the Virginia Supreme Court has allowed a jury to decide whether a condemner should compensate the owner for business fixtures and equipment. When a Taco Bell restaurant was condemned for road improvement, the Commonwealth Transportation Commissioner took the standard approach of saying that they could just be moved. Taco Bell argued for compensation for numerous items used in a restaurant, such as ovens, refrigerators, cash registers, and even aluminum pans and frying baskets.

Virginia judges have, in the past, decided what items the jury should take into consideration when awarding compensation. As a result it was common practice for condemning authorities to refuse to pay for anything that could be moved.

Taco Bell argued, successfully, that pulling the items out and trying to sell them results in pennies on the dollar, and that the items were intended to remain on the property for the life of the business. The court found the evidence sufficient to allow a jury to decide whether the items were fixtures or personalty for purposes of condemnation.

September 14, 2011

The Disconnect Between Eminent Domain and Due Process Doctrines

The author of this law journal note examines the evolution of state laws to guarantee that landowners receive notice and an opportunity for a pre-taking judicial determination of the legality of a taking. The note discusses that courts have failed to rein in the eminent domain power with procedural protections and explores the development of judicial perceptions of eminent domain. It discusses what process is due, and the effect of recognizing due process in eminent domain.

August 29, 2011

Summary Judgment for Defendants in Florida Blight Case

On May 12, 2011, an Orange County, Florida, trial court granted the defendants’ motion for summary judgment having found that the plaintiffs’ inverse-condemnation claims based on the county’s and local water district’s alleged oppressive pre-condemnation activities were unripe and that the plaintiffs failed to exhaust their administrative remedies.

Read the full case note.

— David Weder, Lewis, Rice & Fingersh, L.C., St. Louis, MO

August 29, 2011

Brigham-Kanner Property Rights Conference, October 14–15, 2011

On October 14–15, 2011 the Eighth Annual Brigham-Kanner Property Rights Conference will be held in Beijing, China. The conference, which is sponsored by William & Mary Law School, brings together esteemed scholars, jurists, and practitioners to discuss important property-rights issues.

This year, the conference’s inaugural year abroad, the focus will be on the evolution of property rights on a global scale. Chinese and American panelists will delve into topics including:

• Legal Protection of Property Rights: A Comparative Look
• Reflections on Important Property Rights Decisions
• How Practitioners Shape the Law
• Roundtable Discussion on the Future of Property Rights

During the Conference, Justice Sandra Day O’Connor will receive the 2011 Brigham-Kanner Property Rights Prize and will be a featured speaker. A formal reception will be held on October 13 at the U.S. Embassy in Beijing to honor Justice O’Connor and the conference’s Chinese host, Tsinghua University School of Law. All conference attendees are welcome to attend this reception.

Many familiar faces will be participating in the conference, including:

• Alan Ackerman, Ackerman Ackerman & Dynkowski, P.C., Bloomfield Hills, Michigan
• Jim Burling, director of litigation, Pacific Legal Foundation, Sacramento, California
• Jay S. Dushoff, Gallagher & Kennedy, P.A., Phoenix, Arizona
• James L. Thompson, Miller, Miller & Canby, Rockville, Maryland
• Mark F. (Thor) Hearne II, Arent Fox LLP, Washington, D.C.

 

CLE credit is available to attendees of the conference.

Pre-conference day trips to the Forbidden City and the Great Wall will be planned. An eight-day post-conference tour of China and Hong Kong has been arranged for conference attendees.

Please visit the conference website for additional information.

January 27, 2011

End of the Line for Opponents of Condemnation to Expand Columbia University?

Following the U.S. Supreme Court’s Kelo ruling, 43 state legislatures have amended their eminent-domain statutes to protect property owners, to some degree, from government use of eminent domain to acquire private property to aid private development. New York is not among them.

In 2000, Columbia University began acquiring properties for expansion of Columbia’s West Harlem campus. In 2001, Columbia, a private institution, began working with the Empire State Development Corporation, a public agency with eminent-domain power, seeking the corporation’s help with the expansion.

One of the landowners in the planned expansion area is a self-storage business called Tuck-It-Away, Inc., owned by Nick Sprayregen. Tuck-It-Away owns four self-storage facilities in the expansion footprint. When the Development Corporation threatened condemnation, Sprayregen challenged the authority to do so, claiming eminent domain must not be allowed to be used for assisting private enterprise to further its profit-making purposes under the guise of removing urban blight.

In a rather surprising decision in December 2009, issued nine days after New York’s highest court refused to second guess the public agency’s determination of blight in the case of Goldstein v. New York State Urban Development Corp., 13 N.Y.3d 511, 921 N.E.2d 164 (2009), a state court issued a ruling that the public agency and Columbia University had improperly acted together to use a finding of blight as a pretext to benefit private development.

In June 2010, the New York Court of Appeals disagreed, relying upon its decision in Goldstein, again declining to second guess the government agency’s blight determination.

Sprayregen filed a petition for writ of certiorari with the U.S. Supreme Court, arguing that Kelo requires safeguards to prevent the process from being dominated by pretext and favoritism without a legitimate public purpose. The petition was heard December 10, 2010, by the high court, and certiorari was denied.

Of course, private-property champions lament that the Court’s refusal to hear the case means that the courts have abandoned their vital role and merely nearly rubber-stamp the decisions of other government agencies, while supporters applaud the decision as a positive step toward rebuilding for the future. As to Sprayregen, it would appear to be the end of the line for his resistance, but the latest word is that Sprayregen and his legal team are exploring their options.

— William G. Blake, Baylor, Evnen, Curtiss, Grimit & Witt, LLP, Lincoln, NE

January 27, 2011

Transcanada Keystone and the XL Pipeline Project

In 2007, TransCanada Keystone Pipeline Company began a public-relations campaign across the Great Plains as a prelude to constructing a crude-oil pipeline from the oil sands of Alberta, Canada, through the central United States, to refineries in Illinois and Oklahoma. TransCanada is a Canadian company, building the pipeline in partnership with Conoco Phillips. Between them, they control almost $200 billion in assets, with $6.5 billion in net income in 2009.

TransCanada sent technical and public-relations teams to town-hall meetings along the route of the pipeline to convince owners of the safety of the pipeline and the integrity of the company, touting the economic benefits to state and local taxing authorities. There was considerable noise from opponents, but the project right-of-way was acquired and the construction completed through Nebraska and the Dakotas in 2010.

The Second Phase, the Keystone XL
During the discussions regarding the original Keystone line, TransCanada revealed plans to build a second line out of Canada, a 36-inch pipeline that would carry crude oil to the Gulf of Mexico. This second line, known as the Keystone XL, would complete a 12.2 billion dollar project, delivering 1.1 million barrels of crude oil per day. The oil would be heated at numerous stations along the route, to approximately 160 degrees Fahrenheit, and pumped at approximately 1,400 pounds of pressure.

The public-relations campaign for the XL Project commenced while work to construct the first line was still underway. However, the going got a little tougher the second time around.

Local Opposition
The XL Pipeline will enter the United States several hundred miles west of the entry point of the original line, and will travel southeasterly until it meets with the first Keystone line in Nebraska near the Kansas state line. This route will take it through the Nebraska Sand Hills, a vast and unique, but fragile, area of grasses and wide-open spaces. Once disturbed, the grass cover can take many years to reestablish itself. Wind and water erosion can be severe before reestablishment occurs. Perhaps more important, the Sand Hills sit on top of the Ogallala aquifer, which supplies ground water to much of the Great Plains. The Ogallala aquifer is under virtually all of Nebraska and parts of seven other Great Plains states from South Dakota to Texas.

The farmers and ranchers of Nebraska were not so quick to accept their fate the second time, and TransCanada was not so quick to obtain the needed right-of-way agreements. Landowner groups made demands for more owner-friendly easements. It did not help the process when TransCanada decided to offer fewer dollars to landowners along the XL route than had been paid the first time.

TransCanada became frustrated with the negotiations and threatened to file condemnation before it had obtained approval from the Environmental Protection Agency., which is a necessary step to obtaining a permit from the State Department for construction. That premature threat merely increased the opposition’s resolve, and the battle escalated. TransCanada purchased radio and television spots, declaring the benefits of cooperating with our good neighbor to the north and the ability to offer our children a better education with the extra tax dollars to be paid by TransCanada. The phrase “Good for America, Good for Nebraska” was seen and heard often. These media spots competed, sometimes back-to-back, with ads decrying the spoliation of one of America’s cherished ecosystems and the potential contamination of a vital and far-reaching groundwater system.

U.S. Senators, congressmen, and governors made statements asking Secretary Clinton to deny the permit and move it away from the Sand Hills, while petroleum-company supporters accused them of merely supporting a “not in my backyard” campaign.

At this writing, the battle is not over, but it has quieted down. One of the largest opponent groups made peace with TransCanada, but TransCanada negotiators have let phrases like “if this project gets built” slip into their discussions, while still claiming that TransCanada plans to get started digging a trench through the Sand Hills in 2011.

— William G. Blake, Baylor, Evnen, Curtiss, Grimit & Witt, LLP, Lincoln, NE

January 26, 2011

Eminent-Domain Reform Fails Again in the New Jersey Legislature

Since the U.S. Supreme Court’s Kelo decision, 43 state legislatures have passed reform legislation, limiting to some extent the conditions under which private property can be condemned to promote economic gain. New Jersey is not among those states. SB1451 has been pulled by its sponsor, due to lack of adequate support among New Jersey senators. The bill would have redefined “blight” in line with recent New Jersey court decisions. While New Jersey remains one of the few states in which significant eminent-domain-reform legislation has not been adopted in the wake of Kelo, the New Jersey courts have shown willingness to scrutinize the taking of private property under blight determinations.

Read more: Gallenthin Realty Development, Inc. v. Paulsboro, 924 A.2d 447, 191 N.J. 344 (2007).

January 19, 2011

Mobile-Home Park Rent-Control Ordinance Upheld in California

The court of appeals reasoned that "whatever unfairness to the mobile home park owner might have been imposed by rent control, it was imposed long ago, on someone earlier in the Guggenheims' chain of title."

Read the full case note.

January 4, 2011

Condemnees Liable for City's Cost of Acquiring Their Land via Eminent Domain

The Oregon Court of Appeals held that, in the context of a public-improvement project, a city may impose an assessment requiring condemnees to pay for the cost of acquiring a portion of their land without running afoul of the Fifth Amendment's just-compensation requirements.

Read the full case note.

November 17, 2010

Disparate Settlements in Condemnation Equal-Protection Violation?

Experienced condemnation practitioners are well familiar with widely different treatment of seemingly similarly situated properties. One property owner will receive what looks like a lowball offer while another owner receives what seems to be a very generous offer. Yet, little attention is paid to the settlement process. The usual just-compensation and good-faith-negotiations challenges often do not provide a useful remedy for the owner on the lowball end of the equation.

In an informative, well-reasoned article, Benjamin L. Schuster builds on two fairly recent Supreme Court decisions to argue that the “class of one” equal-protection doctrine should be considered as an effective way to protect property owners from arbitrary and irrational treatment in condemnation settlements. The author includes interesting statistics from studies, anecdotal stories of perceived egregious disparities, as well as insight from a different angle on one of the effects of the Supreme Court’s Kelo decision.

See Benjamin L. Schuster, Fighting Disparate Treatment: Using the “Class of One” Equal Protection Doctrine in Eminent Domain Settlement Negotiations, 45 Real Prop., Trust and Est. L.J., 369 (2010); Village of Willow Brook v. Olech, 528 U.S. 562 (2000); Engquist v. Oregon Department of Agriculture, 128 S. Ct. 2146 (2008).

— William G. Blake, Baylor, Evnen, Curtiss, Grimit & Witt, LLP, Lincoln, NE

October 15, 2010

The Pipeline Media Battle-TransCanada XL and the Great Plains

In 2009, TransCanada Keystone Pipeline Company constructed a crude-oil pipeline from the Canadian tar sands to Illinois, crossing through eastern Nebraska. The company now is planning a second crude-oil pipeline from Canada through the Great Plains. If constructed, it will carry up to 500,000 barrels per day of heated crude oil at high pressure. This planned second line, called the “XL”, would cross Nebraska from South Dakota to Kansas, running through the Nebraska sand hills. The sand hills are exactly what the name implies—mostly loose sand with a rich but fragile grass cover. They are a prehistoric geologic formation and sit on top of one of the world’s greatest groundwater supplies, the Ogallala aquifer, which runs under the Great Plains from Nebraska to Texas.

Not all of the owners of property to be crossed by the underground pipeline are excited to receive compensation from TransCanada in exchange for signing an easement. Disputes between the company and owner groups have resulted in battling media advertisements in newspapers and on radio stations. One side refers to the need for America to be free of Middle Eastern oil, touting the safest and best monitored pipeline ever built, the great opportunity to partner with our good friends to the north, and the economic benefits of new jobs and more tax dollars. The flip-side ads talk about a giant foreign company, risks to the Ogallala aquifer and endangerment to the state’s drinking water, the irreplaceable sand hills, and the unfairness of threats of condemnation issued by TransCanada before the company has even received the needed EPA approval. Local newspaper editors are taking sides, and politicians are checking the direction of the winds of public opinion.

This media/political battle is heating up, overshadowing the comparatively dull arguments over just compensation. Neither side shows any sign of backing down soon.

— William G. Blake, Baylor, Evnen, Curtiss, Grimit & Witt, LLP, Lincoln, NE

October 15, 2010

Book about Use of Eminent Domain Results in Everyone Getting Sued

In 2007, Carla Main authored Bulldozed: Kelo, Eminent Domain and the American Lust for Land, a book about a family’s struggle against what was perceived by the author as modern abuse of eminent domain by taking private property for economic development. The book provides details of the involvement of a developer in the acquisition of the family’s property by the City of Freeport, Texas for a new marina. But that is not the most interesting part of the story.

The developer apparently did not care for the book, as he sued everyone connected with it for defamation, including the author, the publisher, a prominent law professor who wrote praise notes for the back cover, and two newspapers. The author and the publisher remain as defendants. The defendants claim the book merely gives a factual account of the real-estate development and its effect on the lives of real people, and claim the suit is merely an attempt to suppress free speech. Their motion to have the suit dismissed was heard September 28, 2010, by a Texas state court.

You will find entertaining and sometimes enlightening reading here.

— William G. Blake, Baylor, Evnen, Curtiss, Grimit & Witt, LLP, Lincoln, NE

October 4, 2010

Sewage Overflow: How Much is Too Much? Can It Be a Physical Taking?

The property owner filed suit for a writ of mandamus to compel the city to commence an eminent-domain proceeding after the 79th sewage overflow in 10 years.

Committee Member Discusses the Unit Rule on Fox News

New Jersey eminent-domain attorney Anthony Della Pelle was asked to discuss the recent Wisconsin VFW eminent-domain case and Wisconsin’s controversial application of the unit rule to deny a tenant of compensation for loss of leasehold rights to contaminated property.

Supreme Court Affirms Stop the Beach Renourishment

On June 17, 2010, the U.S. Supreme Court unanimously affirmed that Florida’s Beach and Shore Preservation Act is not an unconstitutional taking in Stop the Beach Renourishment v. Florida Department of Environmental Protection,. 2010 U.S. LEXIS 4971, *55 (U.S., June 2010). This decision was highly anticipated, as it was the first takings case for Chief Justice Roberts and Justices Alito and Sotomayor. The Court split on the nuances of the judicial taking question, with Justice Scalia, Chief Justice Roberts, Justice Thomas, and Justice Alito finding that while this was not a judicial taking, such a taking is possible. Id. at *23–*24. The remaining justices declined to determine whether a judicial decision can violate the takings clause. Justices Kennedy and Sotomayor concurred that this case did not require that analysis and, if it did, the due process clause would properly limit judicial power. Id. at *55. Justices Breyer and Ginsberg, exercising judicial restraint, said that this difficult constitutional question did not need to be answered to adjudicate this case. Id. at *70, *73. Justice Stevens did not participate in the decision because he is retiring. Id. at *55.

In Stop the Beach, Florida land owners claimed the state’s beach restoration program constituted a regulatory taking. Florida’s Beach and Shore Preservation Act authorizes the state to restore beaches eroded by hurricanes and tropical storms. This beach restoration creates new land that the state deems public; the private land owners argue this effectively deprives them of property rights without just compensation. The lower court found that the statute violated Florida’s constitution, but the state supreme court disagreed. Specifically, the Florida Supreme Court certified the question of whether “on its face, does the Beach and Shore Preservation Act unconstitutionally deprive land owners of littoral rights without just compensation?” Walton County v. Stop the Beach Renourishment, Inc., 998 So. 2d 1102, 1105 (2008). (Littoral owners are “waterfront owners abutting an ocean sea, or lake.” Walton County v. Stop the Beach Renourishment, Inc., 998 So. 2d 1102, 1105 FN 2 (2008)).

The Florida Supreme Court found that, within the narrow context of restoring critically eroded beaches under this statute, there was no unconstitutional taking. Id. The state has a constitutional duty to protect Florida’s beaches and, on its face, the statute reasonably balances the public and private interests in the shore. Id. at 1120. Moreover, the Florida court opined the private land owners derive benefits under the statute: Their land is protected from further erosion, their littoral rights to use and view are preserved, as is their littoral right to access. Id. On appeal to the U.S. Supreme Court, the property owners argued that the Florida Supreme Court’s decision constituted a judicial taking in violation of the Fifth and Fourteenth amendments.

The U.S. Supreme Court unanimously affirmed the Florida Supreme Court’s holding that there was no unconstitutional taking. 2010 U.S. LEXIS 4971, *55. Justice Scalia, writing on behalf of the Court, noted that the takings clause “only protects property rights as they are established under state law, not as they might have been established or ought to have been established.” Id. at *54. Florida had the right to fill in its own seabed and the sudden exposure of land was properly treated as an avulsion for the purposes of ownership—meaning the state owned the land and the property owners’ accretion and littoral rights were subordinate. Id. at *50. Florida’s decision did not “contravene the established rights of the petitioner’s Members” and therefore was not an unconstitutional taking. Id. at *55.

—Jill Gelineau, Committee Chair, Portland, OR

Who Wins When Eminent Domain Conflicts with State Farmland Preservation Programs?

Can a local utility authority use eminent domain to create a public drinking-water well upon privately owned farmland property, without the permission of state or county agricultural officials that regulate the groundwater resources and protect farmland resources in the area? Follow the link below to watch the recent interview on Fox & Friends of New Jersey farmer, Robert Smith, and his attorney, Condemnation, Zoning & Land Use Committee member Anthony Della Pelle, regarding Mr. Smith’s efforts to stop the local authority from taking the well on his family farm. Mr. Smith contends that creating a well will thwart his efforts to permanently preserve the farm, which has been in his family since the eighteenth century. New Jersey state and Morris County agricultural committees requested that the farm be placed into their farmland preservation program, but have both determined that the efforts of the local authority to create a well may negate the ability of the farm to be permanently preserved because the well area itself and a large buffer that would be required around it will interfere with farming operations on the property. This case, which is scheduled for argument before a New Jersey Superior Court judge in early October, tests the limits of a local government’s eminent-domain powers and presents the issue of how a local government may try to buck the authority of its superior governments. Stay tuned for more.

Does the Takings Clause Provide a Remedy for a Bad-Faith Taking?

“No,” argued the town of Brandord, Connecticut. “Yes,” said the Supreme Court of Connecticut.

The landowner submitted an application to develop property for low-cost housing, a legally permitted use, but the town responded by taking the land. The owner countered with suit for damages, claiming in state court that the taking was in bad faith, violating the takings clause and thereby violating 42 USC § 1983. The town raised the standard plethora of defenses to such claims plus the interesting argument that the public-use portion of the takings clause prohibits only a taking of private property for a use that is not a public use, and the takings clause does not provide a remedy for a taking that is undertaken in bad faith or one that is an abuse of power. The court agreed with the trial court’s finding that the town’s actions were in bad faith and affirmed the award of damages to the owner. It was remanded for determination of attorney fees .

See: New England Estates, LLC v. Town of Branford, 988 A.2d 229 (Conn. 2010).

Fun Quote-Who Says Condemnation Law Can't Be Fun?

Greek mythology makes for a good lesson regarding the difficult choices faced by plaintiffs in federal takings cases, as they sail their ships clear of ripeness problems only to face ruin by limitations.

Scylla and Charybdis were the treacherous sea monsters of Greek mythology, who lurked on the opposing sides of the Straits of Messina between Sicily and Calabria. According to lore, these nightmarish creatures were strategically placed so as to pose an inescapable threat to passing ships – sail too close to the peninsula and Scylla would seize and devour your crew with her six serpentine heads; compensate, by navigating closer to the island of Sicily an face the loss of your entire ship in the maelstroms belched from Charybdis’ gaping mouth. . . . Some might say that , in Federal takings law these fictional leviathans have been replaced by the doctrines of ripeness and limitation. . . . In some situations, litigants may find themselves between a rock and a hard place. Allegra, J. U.S. Court of Claims. Petro-Hunt LLC v. United States 90 Fed.Cl. 51 (2009).

For more fun, read about the trials and tribulations of Odysseus as he avoided total ruin in the whirlpool of Charybdis by choosing to battle Scylla and thereby only losing six men, in Homer’s Odyssey, or Ovid’s Metamorphoses. Odysseus needed a takings clause.

New York Intermediate Appeals Court Turns Down Eminent Domain for Columbia University Campus

Nine days after New York’s highest court ruled that eminent domain could be used for economic development in an area declared blighted by a local redevelopment authority, the New York Supreme Court, Appellate Division (First Department) has ruled that private property cannot be taken for overwhelmingly private benefit. The property in question is part of an area that had been declared blighted. The plan was to make it part of a new Columbia University campus.

In Kaur v. New York State Urban Dev. Corp., NY Slip Opinion 08976 (Dec. 3, 2009),the court found “remarkable conflicts with Kelo parameters on virtually every level”, which rendered the taking unconstitutional. Critics of the opinion are asking, of course, how it can be acceptable to take private property for a private developer’s new basketball arena, but it is not acceptable to take property for a university campus. In one case the court did not find it appropriate to second guess the local redevelopment authority’s determination of blight, but in the other case the blight determination was viewed as a mere pretext for the benefit of an elite education institution.

Atlantic Yards Decision: New York High Court Upholds Eminent Domain for Economic Development

On November 24, 2009, the New York Court of Appeals, the state’s highest court, announced its decision to uphold the use of eminent domain to acquire private property for the massive “Atlantic Yards” development project. The court stopped short of embracing the U.S. Supreme Court’s controversial decision in Kelo v. City of New London, which held that a government may be empowered under the U.S. Constitution to acquire property for economic development alone.

The New York court found the takings were for a public use because the area had been declared blighted by the local redevelopment authority. The blight study supporting the project, paid for by the developer and conducted years after the project was announced, included the finding that the neighborhood was underutilized. The court recognized that such studies and findings paid for by developers could serve as a predicate for the invasion of property rights, but took the view that it is the job of the legislature to fix any problems.

A dissenting opinion criticized the majority for “abandoning its duty to critically examine” the findings of the redevelopment authority.

Since Kelo, 43 states have passed eminent-domain reform to restrict condemnation for economic purposes. New York is not one of them.

The End of Kelo-Pfizer Abandons the New London Project

In the late 1990s, the city of New London, Connecticut, looked to Pfizer to build a new research and development facility, as the key to a massive urban renewal and an economic boost to the city’s aging Fort Trumball area.

That’s where Suzette Kelo’s little pink house stood. Her desire to not sell her home resulted in the controversial decision by the U.S. Supreme Court allowing a state to define public use so as to include such economic rejuvenation projects, and resulted in Suzette’s home, along with many others, being acquired and removed. See Kelo v. City of New London. Ms. Kelo’s home was eventually acquired by the city, and sold to Pfizer as part of a 24-acre parcel, all for $10.

Now, after merging with Wyeth, Pfizer has announced it will close its facility in New London, shutter the building, and take 1,400 jobs elsewhere. The Fort Trumbull area where the pink house stood? There is very little to show for all the effort other than weeds and scattered demolition rubble.

It is reported by the Institute for Justice that 43 states have now reformed their eminent domain law to limit its use for economic gain.

Village Apologizes for Violating Property Owner's Constitutional Rights

The village of Port Chester, New York, has issued a formal apology to a local businessman, after engaging in a nine-year eminent domain battle in which the owner had claimed the village took his property to make way for a private development project. As part of a settlement, the village announced that it “sincerely apologizes . . . and regrets the hardship it has caused.”