Lowbal Watch – Connecticut

The Connecticut Court of Appeals affirmed a $220,800 trial court judgment in a taking for a fiber cable right of way, where the condemnor had awarded only $38,100 to the owners. Commissioner of Transportation v. Isis Realty Associates, 993 A.2d 491 (Conn.App. 2010).

Lowball Watch – Massachusetts

A Massachusetts Court of Appeals affirmed a verdict, awarding over $3.6 million, plus $400,000 in interest for the taking of a 5.5-acre parcel of land by the Mystic Valley Development Commission for an “expansive 200-acre business and residential complex.” The Commission had deposited $280,000 six years ago when it took the property.

By our calculation, the award comes to over twelve times the Commission’s offer, not counting the interest.

For the story go to http://www.boston.com/yourtown/news/malden/2010/07/appeals_court_orders_4m_paid_i.html

Lowball Watch – Missouri (Cont’d.)

Remember our recent post about the St. Louis caper in which the  city took an owner’s property after offering him $523,000? Sure you do — check out http://gideonstrumpet.info/?p=453  It turned out to be what you might call a nice try. Later, the commissioners awarded $1,260,675, and eventually a jury upped that to $1,610,525, plus $317,427 in past interest, plus accruing interest on the balance.

What made this case real fun was that the city refused to pay up, arguing that since it took the property for a redeveloper, it was that redeveloper who should pay. So the owner sued the city and, to make a long story short, stltoday.com reports that the city finally paid up. All in all, considering interest, the total came to some $3.5 million, or some ten times the original offer.

For the story, go to Robert Patrick , Former Landowner Finally Gets Check in Bottle District Case, stltoday.com, July 23, 2010, http://www.stltoday.com/news/local/crime-and-courts/article_e95e7a32-9698-11df-9860-0017a4a78c22.html 

Why the Promise of “Just Compensation” in Eminent Domain Isn’t True

“[D]efined [as fair market value], just compensation is less than full compensation… Full compensation will often exceed fair market value, if only because of moving expenses. But while acknowledging that fair market value is not always full compensation, the Supreme Court… blunted the point by saying that the shortfall ‘is properly treated as part of the burden of common citizenship’ – which again is a conclusion rather than a reason – but in a more practical vein remarked the difficulty of determining nonmarket values by the methods of litigation. 

The fact [is] that ‘just compensation’ tends systematically to undercompensate the owners of property taken by eminent domain…” United States v. Norwood, 602 F.3d 830, 834 (7th Cir. 2010) (Posner, J.), citations omitted

No comment appears necessary, except to note that the Supreme Court’s justification relying on the supposed difficulty of ascertaining nonmarket values is nonsensical on two counts. First, courts often proclaim demonstrable, economic losses, ascertainable by conventional valuation techniques, to be “noncompensable” in eminent domain, whereas in other litigation it is black-letter law that the difficulty in ascertaining the amount of damages does not justify their denial. Second, talking about “common burdens of citizenship,” even as the courts impose uncommon, uncompensated losses on condemnees but not on other litigants nor on other members of the public in the area who benefit from the public projects, is absurd.

Man Bites Dog!

In a reversal of the scenario encapsulated in the familiar newspaper headline, we have just come across a news item from Ukiah, California, where, believe it or not, local business people are clamoring for the local city/redevelopment agency to use the power of eminent domain to take and rehabilitate or raze a neglected old hotel. Usually, it’s the business folks who oppose the use of eminent domain for redevelopment, but in this case their principles evidently do not extend to the protection of someone else’s property.

No one is reported to be urging enforcement of municipal building and safety codes.

The moral of it all would appear to be that, as V.I. Lenin is supposed to have said: “When the world’s last capitalist is hanged by the revolutionaries, he will swing from a rope sold to the revolutionaries by the world’s next-to-last capitalist.” We don’t really know if ol’ Vladimir Ilyich actually said that, but if he didn’t he should have.

For the story, go to http://www.ukiahdailyjournal.com/news/ci_15474431?source=rss

A tip of our hat to our colleagues on the Nossaman blog http://www.californiaeminentdomainreport.com/

No “Embargo” Around Here, Folks

Don’t miss the article by Howard Blume, School Cost Is Record for L.A. Unified, L.A. Times, Jul. 14, 2010, at p. AA1, reporting that after some quarter of a century of shilly-shallying, the Los Angles Unified School District has announced that the new complex of schools it is building in the mid-Wilshire area of Los Angles (on the site of the former Ambassador Hotel — the erstwhile home of the Coconut Grove and the site of assasination of Senator Bobby Kennedy) has added another dollop of projected expenditures for this project — another $6.6 million for a grand total so far of  $578 million.

Last time we looked, the record for such stuff was held by the “Belmont Educational Center,” a downtown Los Angeles high school that had been built — oops! — on top of an abandoned oil field without taking the precaution of sealing its underside against methane leakage, so it could not be used as a school in spite of an expenditure of some $217 million, last time we looked. Oh well, easy come — easy go. After all, it’s only your money. But we digress.

When it comes to the Ambassador Hotel site, we feel intimidated trying to describe the background of this land acquisition saga, but if you are made of sturdy stuff, we recomment that you read the on-again, off-again, on-again adventures and misadventures of this project, in California Court reports. It was on-again, when the School District filed an eminent domain action to take the site from Donald Trump — yep, that Domald Trump — and deposited $47.919 million, whereas “The Donald” was thinking around $200 million. See L.A. Unified School Dist. v. Trump Wilshire Associates, 42 Cal.App.4th 1682 (1996).

That was too rich for the District (which, as it happens, claimed to be unable to maintain the site pending condemnation, and for that reason did not use a quick-take procedure). So the District prudently abandoned the condemnation and dismissed the eminent domain action. But by then Trump split, having paid off his loan with the withdrawn funds that had been deposited by the District, and sold his interest. The remaining owners whose prospects of development had gone south in the meantime because of a decline in the economy, and because of local riots, tried to keep the District from abandoning, but the court said nothing doing, because the owners had not changed their position irrevocably in reliance on the eminent domain action. See See L.A. Unified School Dist. v. Wilshire Marketplace, 89 Cal.App.4th 1413 (2001).

But some time later, the District changed its mind, acquired the site after all, and proceeded with the construction. There is much to tell about that one, and perhaps one of these days we’ll take a deep breath, down a stiff drink and have at it. But not right now.

The point of this post, is to remind our readers that Los Angeles is in California, the home of the California Supreme Court which has held that in spite of flowery, idealistic judicial language about fairness, justice and indemnity, it’s that court’s policy to keep eminent cdomain awards low, not necessarily just. Condemnees don’t get paid for all  demonstrable economic losses inflicted on them by condemnation, and that if we were we to do that, “an embargo” — yessir, an embargo — on public project would have to be declared.

But it turns out that even in the depths of the Great Recession of 2008, there does not appear to be an embargo on the construction of “the Los Angeles Unified School District’s most expensive school project, now surpassing $578 million.” 

For the L.A. Times story go to: http://www.latimes.com/news/local/la-me-0714-ambassador-20100714,0,2788053.story

Lowball Watch – Virginia

The Washington Business Journal (Tierney Plumb, Alexandria To Pay $36M For Faily Land, July 9, 2010), reports that the Alexandria Sanitation Authority is eating the green wienie to the tune of an extra $16,000,000 that it has offered over and above its original offer of $20,000,000, for a 10-acre parcel of land being taken to expand Alexandria’s wastewater treatment facility.

For the story go to http://www.bizjournals.com/washington/blog/2010/07/alexandria_to_pay_38m_for_family_land.html

Lowball Watch – New York

This is a biggie, folks. 

A dispatch from PR Newswire indicates that the State of New York took 245.5 acres of land from Gyrodyne Company of America back in 2005, and deposited $26,315,000. Now, after trial, the State Court of Claims awarded an additional $98,685,000, plus 9% simple interest. Gyrodyne will be submitting a request to the court fot attorneys’ fees.

Stay tuned.