Monthly Archives: January 2018

California Choo-Choo — (Cont’d.)

We haven’t had much to say about the supposedly abuilding high speed train line between San Francisco and Los Angeles, or at least its initial 119 mile segment running from Madera to Fresno (aka the middle of nowhere), because there hasn’t been much news on that subject. But news came with a bang on the front page of today’s Los Angeles Times (Cost of State’s Train Surges, Jan.17, 208, p. A1) bringing the dispatch that the financial condition of the train project is parlous. The now conceded increase in the cost of that segment jumped from an estimated $2.8 billion to — are you ready? — $10 billion. This, we are told, is the worst-case scenario that was “long forewarned” but the warning was rejected by the railroad project’s management. Now it is coming to pass.

So much for the news which, as it turns out, is no news at all. Overruns of this kind, that belatedly try to raise the excuse of “higher cost of land acquisition” are old hat. Our own files contain an old article in a conservationist magazine called Cry California. The Spring 1966 issue contains an article by Joseph C. Houghteling, then member of the California Highway Commission, entitled Confessions of a Highway Commissioner at p. 29. In it the author reveals that “Actual costs were an average of 32 percent above estimates, most of the increment coming from additional right-of-way costs.” (at p. 30). That was a half century ago, and evidently not much has changed since then.

If you want an insight into how this happens, take a look at 40 Loyola L.A. L. Rev. at 1108, footnote 162, for an extensive collection of studies indicating that underpaying property owners for land taken from them is common in California as well as in other states. In a nutshell, appraisers of thousands of parcels constituting a major right-of-way are under pressure to come in with low opinions of value to impress their condemnor-clients and because unsophisticated and unrepresented property owners believe that “you can’t fight city hall” and accept those lowball offers in disproportionate numbers. For an explanation of this process by a prominent appraiser, see Ibid, at pp. 1106-1107, footnote 158. In other words, lowballing by condemnors is common and property owners who refuse condemnors’ pre-condemnation offers and try their cases, whether before judges or juries, usually recover compensation quite a bit higher than those offers, often higher by millions of dollars. For some outstanding examples of the stunningly higher awards granted by courts, or even agreed to by condemnors once the weaknesses of their own appraisals are exposed, see Ibid, at pp. 1146-1148.*

So if the California high speed railroad builders are experiencing unanticipated costs of right-of-way acquisition, they are only treading an old beaten path of their own making. California law requires explicitly that condemnees be paid the highest price that their property would bring in a voluntary market transaction. So it should not come as a surprise that when instead condemnors try to lowball condemnees, the compensation they have to pay is higher than their hopes.

* Our favorite case of that sort is People ex rel. Dept. of Transp. v. Southern Calif. Edison Co (2000), where California DOT deposited $245,000 as its good faith estimate of “just compensation” for a partial taking of a major electrical transmission line, but at trial (a) the jury awarded some $49.5 million, and (b) on appeal the California Supreme Court affirmed and ordered the State not to brief the issues of valuation because the court would not consider them.

Ed McKirdy — R.I.P.

It took us a few days to recover from the shock, but reality must be faced. Our friend and colleague Edward McKirdy has passed away. He was a gentleman and a super lawyer whose presence enhanced any gathering.

We could at this point go on and launch into a string of complimentary adjectives, but it somehow seems unnecessary. If you knew Ed you must know what a gentleman, a scholar and a mensch he was, and what a privilege it was to work with him. And of course there was Ed the man. If nothing else, it was a unique pleasure to dine with him, and just to sit with him and Laura, his charming, one-of-a-kind wife and engage in the lost art of intelligent and witty conversation over a good meal.

Our profession is poorer for his passing, and we will never see the likes of him, his talents and his wit again.

The Fish that Ate Manhattan

Los Angeles Daily Journal

Jan. 3, 2018

Gideon Kanner
Professor of Law Emeritus, Loyola Law School

Being old isn’t all bad. If you’re lucky, you remember things and you gain perspective. Case in point, the abysmal traffic conditions in Manhattan recently reported by the New York Times which reports that Midtown Manhattan traffic has reached a near-gridlock condition. Winnie Hu, “App-Hailed Cars Clog Streets. Should Riders Pay for the Jam?” Dec. 27, 2017 (front page, no less).

Current average car speed in midtown Manhattan is 4.6 mph, down from 6.5 mph only five years ago. (Walking speed is 3 mph — which means that a jogger can beat Midtown traffic.) The Times attributes these conditions to the presence of Lyft, Uber and Juno ride-hailing app vehicles looking for fares. Adding insult to injury, “more than a third of ride-sharing cars and yellow taxis that clog the streets are empty at any given time during weekdays in Manhattan’s main business district.”

Today, there are 103,000 for-hire vehicles plying New York streets, as opposed to only 47,000 as recently as 2013. Uber alone puts 65,000 cars on Manhattan streets. The upshot is that you can easily get a ride when you want one, says the Times, but once you get in the car, you’re stuck.

But another way of looking at this problem is that Manhattan streets are unequal to the task of accommodating modern traffic. So the question virtually asks itself: Weren’t New York traffic engineers smart enough to see what was coming and what to do about it? Yes, they were, but these days, planning and building are two different things once environmental concerns are brought to bear on the problem at hand.

The story of the old decrepit Manhattan West Side highway that was torn down back in the 1970s, but never replaced is instructive. Why? Oh, they tried, and therein lies a tale. What stopped the would-be highway rebuilders was a lawsuit brought by environmentalists who persuaded a local federal judge, Thomas F. Griesa, to bar the construction of a new replacement West Side Highway on environmental grounds.

By an odd coincidence, the same issue of the Times that tells us about the impending Manhattan gridlock also carries an obituary of Judge Griesa, and brings it all back to mind. Griesa found that the plans for the proposed replacement highway violated environmental laws, and barred its construction. The plan was that the new West Side Highway would permit much of the local traffic to bypass the congested mid-Manhattan streets, and keep it moving. It would run from the southern tip of Manhattan to 42nd Street, using a tunnel for a part of its route. It was projected to cost some $2 billion (in 1970s dollars, or $5.7 billion adjusted for inflation).

So was the proposed new highway environmentally bad by increasing air pollution, as claimed by the environmentalists? No. Judge Griesa, according to the Times, rejected that argument, and based his highway-killing judgment on the proposed highway’s adverse impact on fish. Fish? In Manhattan? Yes, fish. Specifically, the Hudson Striped Bass which was not even endangered. It was, according to the judge, “one of the nation’s most popular and commercially lucrative fish,” and it still is. So the new highway was not built, even as Manhattan traffic grew worse and is now approaching gridlock conditions.

As far as I know, the Hudson River has been cleaned up to some extent, but that was largely due to removing industrial waste accumulated on the river bottom in the industrial area way upstream, near Poughkeepsie. It had nothing to do with automobile traffic in Manhattan. Swimming in the Hudson remains hazardous in places. And so I fail to see how improving the river water quality for fish does much of anything for embattled New Yorkers stuck in traffic, waiting for the red light to change so they can move forward another few feet. To say nothing of wasted energy and air pollution caused by all those idling cars (recall that, ironically, air pollution was what the environmentalists claimed to be defending New Yorkers from).

Which brings us to the moral of this story — actually two morals. First, judicial rulings have consequences, even when there is a time lag between their promulgation, and a visible manifestation of their effects. Some judicial rulings can be terrific, but others are unsound, or even disastrous, like the misbegotten judicial notion of bussing kids from good schools to decrepit, dangerous inner city ones, a feat that helped empty the cities of their middle class populations and in some cases transformed them into urban wastelands, as middle-class families fled to the suburbs.
Second, a legal question: How come, in eminent domain cases, the same judges who wield a heavy hand in environmental review litigation — such as killing entire public projects on environmental grounds — hold that condemnors’ findings of public use are “well-nigh conclusive” and disclaim any power to deal on the merits with land owners’ defenses alleging that condemnors’ findings of necessity for the proposed public works, their efficacy, safety, location, layout, etc. are defective?

In the notorious Chevalier case, the California Supreme Court went so far as to hold that in eminent domain cases, state compliance vel non with statutory criteria of public necessity was altogether nonjusticiable, not even where the condemnors’ determination was obtained by fraud, bad faith and abuse of discretion. The California Legislature repealed that rule in 1976 but the court never retreated from it, and even now review of these matters is available only in cases of a condemnors’ “gross abuse of discretion” or bribery. New York federal courts did the same over there, when in the Rosenthal & Rosenthal case they upheld a condemnation, refusing to inquire into allegations that a redevelopment project’s boundaries were corruptly drawn to benefit the mayor’s friends.

Conclusion: Ideas do have consequences, and as this saga illustrates, in time seemingly unconnected court rulings can have a profound impact on people’s lives. The parties who fought it out before Judge Griesa almost a half-century ago could have no idea that their wrangling over the comfort levels of an abundant fish would come at the expense of people’s life quality affecting their daily lives.