Author Archives: Gideon

California Choo-Choo – (Cont’d)

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From today’s (1/14/17) on-line summary of news by the Los Angeles Times:

 “More troubling news about California’s bullet train. The project could cost taxpayers 50% more than estimated — as much as $3.6 billion more. And that’s just for the first 118 miles through the Central Valley, which was supposed to be the easiest part of the route between Los Angeles and San Francisco. A federal document outlines far-reaching management problems: significant delays in environmental planning, lags in processing invoices for federal grants and continuing failures to acquire needed property. Los Angeles Times (emphasis in the original).”

Click on the link for the entire article.

Richard Adams, R. I. P.

Do you know who Richatd Adams was? He was the author of the huge 1972 bestseller Watership Down. He recently passed away at 96 in England, where he lived. Though not relevant to our chosen subject of eminent domain and land use law, this event bears noting because Adams’ subject was and remains a gigantic achievement in clear thinking, and sound governance, even if was cast in the form of an allegorical tale about a band of rabbits facing the destruction of their community.

 We will let the New York Times tell the story:

  • “Facing the destruction of their underground warren by a housing development, a small party of yearling bucks led by a venturesome rabbit named Hazel flees in search of a new home. They encounter human beings with machines and poisons, snarling dogs and a large colony of rabbits who have surrendered their freedoms for security under a tyrannical oversize rabbit, General Woundwort.
  • “It was a timeless allegory of freedom, ethics and human nature. Beyond powers of speech and intellect, Mr. Adams imbued his rabbits with trembling fears, clownish wit, daring, a folklore of proverbs and poetry, and a language called Lapine, complete with a glossary: “silflay” (going up to feed), “hraka” (droppings), “tharn” (frozen by fear), “elil” (enemies).
  • “The pioneers realize that founding a new warren is meaningless without mates and offspring. With a sea gull and a mouse for allies, they raid Woundwort’s stronghold, spirit away some of his captive does and confront his forces in a pitched battle in defense of their new warren on Watership Down.”

If you can find a copy of Watership Down, read it and ponder its lesson

California Freeways

Headline in the New York Times:

Los Angeles Drivers Ask:  Was $1.6 Billion Worth It? Dec. 20, 2016, at p. A2.

Actually, that headline says it all, but if you want the whole story go to http://www.nytimes.com/2016/12/20/us/los-angeles-drivers-on-the-405-ask-was-1-6-billion-worth-it.html?emc=edit_ca_20161221&nl=california-today&nlid=59608749&te=1&_r=0

Suffice it to say here that the construction project in question was known around here as “Carmageddon.”

Eminent Domain in Israel

If you are an attentive newspaper reader you may have noticed reportage about a controversy in Israel, where the local supreme court ruled that a settlement built in the territories was illegal and the settlement structures would have to be removed (a remedy unavailable in American law). The Israeli parliament responded to the court ruling by passing legislation that would allow the government to take the land underlying the subject settlement by eminent domain, pay its Arab owners for its value, and transfer it to the settlers who have already built homes on it and are living there (most of the subject land was unoccupied when the settlers moved onto it).

Matters are complicated by the fact that (as it appears to us) the land in question may be so-called “miri” land on which under preexisting Jordanian law anyone can settle, and after occupying and cultivating it for a specified period of time, and paying taxes on it receive a usufructary title. Our impression is that Kontorovich talks about the law of eminent domain, while his critic pefers an argument based on international law — which makes these folks like two ships passing in the night; the critic does not really addresses Kontorovich’s eminent domain law point, and the world is full of cases of land and population transfers, both compensated and uncompensated, which makes the supposed “international law” argument dubious at best.

As for us, one of your faithful servant’s first cases right here at home, was Regents of the Univ. of California v. Morris, 266 Cal.App.2d 616 (1969) in which a huge, multi-hundred unit apartment complex was taken by eminent domain in order to expel its tenants in order to make their apartments available to UCLA students. So under our law, such a taking would appear to be hunky-dory.

Anyway, we provide here an exchange between two Israeli mavens (one from justsecurity.org (Dec. 20, 916)) on the legality of that taking. Enjoy!

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Israel’s Settlement Regulations Bill and International Law

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[Editor’s Note: After reading Eugene Kontorovich’s post, be sure to read a response to his post by Yaël Ronen and Yuval Shany, “Israel’s Settlement Regulation Bill Violates International Law,” which is being published simultaneously at Just Security.]

Israel’s proposed “Regulations Bill” has attracted broad international criticism, including from the U.S. State Department and the European Union, as well as from opposition Israeli politicians and some government lawyers. The bill seeks to solve a situation in which, over several decades, over one thousand Israeli homes in West Bank settlements have been built in open areas to which Palestinians subsequently asserted property claims, typically based on broad give-aways of state land by the King of Jordan during the Hashemite occupation (1949-67). The homes are in communities built with some level of government involvement. Thus the bill provides the government would compensate the landowners 125% of the value of the land, in order to allow the communities that have been built there to remain.

The plots are generally open, uncultivated fields. The frequently used characterization of “private Palestinian lands” is misleading. In the overwhelming majority of cases, no individual Palestinians have come forward to claim the lands. Indeed, in most cases, no property claimants asserted their interests for decades after houses were built, a situation that in common law would certainly warrant the application of adverse possession doctrines, under which long-term possession of property unprotested by owners can change legal title, exactly to prevent these kinds of conflict between long-term users and owners who slept on their rights . Under Jordanian law, rules of prescription, which would turn the land over to its existing inhabitants, would apply. In cases like the community of Amona, which inspired but are not covered by the law, the Court made its determination without any fact-finding, and the lands claimed by the Palestinian petitioners only slightly overlap with those on which the Israeli homes stand.

Thus the law regulates situations where property claims, often difficult to verify, are being belatedly brought against areas that have seen significant improvement and home-building. Moreover, in the background are two legal doctrines that make the property impasse particularly costly. On one hand, the Israeli Supreme Court exercises broad remedial powers. Instead of merely awarding title to Palestinian claimants, it affirmatively requires the government to destroy all structures whose plots may overlap even in part with the claimed lands. On the other hand, bargaining in the shadow of obscure Jordanian land allotments is made close to impossible by a Palestinian Authority law criminalizing the sale of land to Jews. While Palestinian President Mahmoud Abbas has recently issued an executive order reducing the traditional death penalty to life at hard labor, there are reports that the old punishment may still be enforced de facto.

The central international law argument against the bill is that it exceeds the powers of an occupying power over private property. Assuming, for the sake of argument, that the law of belligerent occupation applies to Israel’s settlements in the West Bank, the central question becomes whether that body of law prohibits eminent domain and similar land use regulation by the occupying power. This argument has focused on Art. 46 of the Hague Convention, which states that “private property cannot be confiscated.” Critics of the Israeli bill have broadly declared that Art. 46 of The Hague Conventions absolutely prohibits any action involving private real property absent military necessity. This is not the established law, but rather one view of a longstanding debate.

Put simply, the ban on “confiscation” of real property does not mean a ban on expropriation, that is, a taking subject to just compensation. “Confiscation” in The Hague Regulations is a narrow term that refers only to certain uncompensated taking, which of course are the kind occupying powers may be particularly wont to make.  To put it differently, “confiscation” does not cover all kinds of property taking or regulation, as is made clear in numerous military manuals that refer to an entire taxonomy of regulation, from confiscation to expropriation to requisition. The U.S. Defense Department’s Law of War Manual provides for compensation for takings of private real property, and refers to this as “appropriation” not “confiscation.”

For example, Prof. Yutaka Arai’s recent treatise on the law of occupation specifically distinguishes the question of “expropriation” with compensation from Art. 46’s ban on “confiscation.” Arai writes that “many experts argue that expropriation … is not forbidden.” He goes on to cite the leading post-war authority George Schwarzenberger as maintaining that ordinary eminent domain for development purposes is not governed at all by the law of occupation. That is, the articles of The Hague Regulations simply do not address this issue.

Some specific examples of permissible purposes for which such eminent domain by occupying powers might be used include “land reform” addressing feudally based land-ownership. Certainly the current property situation in Samaria, created by broad grants to clans by an occupying Jordanian monarch, would qualify. To be sure, there are also authorities that say expropriation is forbidden, but currently there is no resolution of this dispute in theory or practice. That means there is no prohibition, as the basic rule of international law is that action is permitted unless a clear prohibitory norm has emerged.

It is probably unnecessary to discuss the Rome Statute of the International Criminal Court, as Israel is not a member (though the Office of the Prosecutor has controversially purported to accept jurisdiction over “the State of Palestine”). But for thoroughness, it is worth noting the Rome Statute criminalizes the “seizing” of property absent military necessity (Art. 8(2)(b)(xiii)). To be sure, such acts are only criminal for ICC purposes when committed “in the context of … and associated with international armed conflict,” an element that appears missing in the Israeli-Palestinian situation.  In any case, commentaries treat “seizure” as referring to uncompensated takings, analogizing it very closely to crime of “pillage,” which of course requires much more than a switch from property to liability rule protection.

Not surprisingly, those who argue international law forbids such action fail to cite any state practice outside of Israel for this proposition. To be sure, the payment of compensation by belligerent occupiers is probably quite rare, as typically long-term occupiers seem to simply take what they want without bothering about compensation. The entire question of eminent domain – which involves a transfer of title – will only arise in prolonged occupations. In the typical short-term occupation envisioned by the Hague and Geneva treaties, the occupier has no need or interest to change the title to land, which is always about long-term policies.

Yet in several prominent cases, long-term occupiers have used compensated takings, and the international community appears to have acquiesced, and certainly did not declare it illegal.  Examples include the Turkish occupation of Northern Cyprus, where a compensation scheme aimed at permitting Turkish settlers to remain in Greek properties was approved in 2005 by the European Court of Human Rights. Similarly, the Russian occupation of Crimea takes private property with compensation (often in the form of other land), even for highly controversial projects like the Kerch Bridge, which will serve to deeply entrench the occupation and facilitate the transfer of settlers. Yet while many aspects of Russia’s occupation of Crimea have been denounced as illegal by the international community, the use of eminent domain has not. In particular, the ICC Prosecutor’s report on possible Russian crimes in Crimea makes no mention of it. The fact that many aspects of Russia’s Crimean occupation have been explicitly criticized on international law grounds, but this one ignored, suggests that it is not seen as illegal.

Indeed, property owners who have been compensated have no injury to complain of. As the French Government wrote in its submission to the International Court of Justice in the Wall Case, “international law…  requires compensation which effectively makes good the entire injury suffered by the owners of the property in question. Indeed, claims of violations of international law are often accompanied by demands for compensation. This may be the first case where it is the payment of above-market compensation is claimed as an international law violation.

In short, prior to the introduction of the Israeli “Regulations” bill, neither the consensus of commentators nor any state practice supported the view that the prohibition on confiscation or seizure of private property in occupied territories applies to land-use regulations accompanied by the payment of complete compensation.

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Gideonstrumpet Note: Under American law, when land is taken by the government, the [former] owner’s sole remedy is an inverse condemnation action for compensation. U.S. law does not provide for specific remedies; only for compensation. Hurley v. Kincaid (1932).

 

Lowball Watch — California

Word reaches us from San Diego that the Tri-City Medical Center has decided to abandon a condemnation action it had filed earlier to take a three-story medical office building in Oceanside. The condemnor deposited $4.7 million, but after trial, a jury awarded $16.8 million, and the trial court also awarded litigation expenses in the amount of $2.2 million. See Paul Sisson, Tri-City Says It Wants to Abandon Eminent Domain Fight, San Diego Union, Dec. 19, 2016,

http://www.sandiegouniontribune.com/news/health/

The unusual twist in this case is that the owners seek to prevent the condemnor from abandoning and are filing an appropriate motion with the court. They argue that under the circumstances, an abandonment of the condemnation action cannot restore the owners to the status quo ante. So far, the condemnor has spent some $2.6 million in litigation expenses of its own on this litigation.

More is certain to come, so we will try to keep an eye on this one. Stay tuned.

Lowball Watch — Connecticut

Hartford Business.com reports that a trial court in Connecticut (there are no eminent domain juries in the Nutmeg State) ruled that Hartford undercompensated a property owner whose land it took by some $3 million. The city deposited $ 1.98 million, whereas the trial judge awarded $4.8 million. Although the subject property is located near a local stadium, wrote the judge . . .

“[t]he most astounding shortcoming of both of the city’s appraising experts is that neither of them took into account the announcement of the ballpark [to expand], despite the facts that their previous appraisals did not include the consideration of the major change of the construction of a ballpark …”

The city vows to appeal. See http://www.hartfordbusiness.com/article/20161207/NEWS01/161209948/1002

World-Class Chutzpa at the Los Angeles Times

According to the Los Angeles Times (Steve Lopez, Will the State Cross that Line in the Sand? Dec. 7, 2016, at p. B1), there is a fellow up north, a cyber-billionaire named Vinod Khosla who, as befits one of his wealth, bought himself an 89-acre piece of waterfront land south of Half Moon Bay, for which he paid $32 million. So far, so good. But when he took possession and fenced off his land, local NIMBY neighbors protested, arguing that they had a right to use it. What their legal contention is, is a puzzle because California law (Civil Code Sec. 654) is quite clear that ownership of property includes the right to exclude others, and no one disputes that Mr. Khosla does indeed own the subject property.

So who you gonna call now if you’re a NIMBY who wants to use Khosla’s  property without his permission and without paying for it? The State Lands Commission, that’s who.

Though it has never done so before, the State Lands Commission leaped into action in an effort to acquire Khosla’s land for the use and pleasure of the aforementioned NIMBYs. To do that the Commission asked to buy the subject property, offering Khosla — are you ready? — $360,000, which he sensibly declined, being as he paid some ten times that amount for that land. So now, the state folks are threatening to take the subject property by eminent domain, although no one has tried to explain how they intend to pay just compensation of $360,000 for a parcel that has a market value of over $3 million, as demonstrated by its recent sale, in light of California law that defines constitutionally required “just compensation” payable in eminent domain cases as fair market value, defined as the highest price the subject property would bring in a voluntary market transaction (Cal. Code. Civ. Proc. Secs. 1263.310 and 1263.320).

There matters stand, thus providing us with the prospect of a coming item for our “Lowball Watch” department, to join such stellar bits of eminent domain litigation as the State’s past attempt to acquire the Los Angeles Union Station for 25 mil or so, only to be confronted with a court award of over $84 million which it could not pay, so it abandoned the taking. Then there was the famous Southern California Edison case, where the State deposited $234,485 into court as its idea of “good faith” just compensation, only to be hit in court with an award of $49,500,000, which was summarily affirmed by the California Supreme Court and which the State had to pay with interest. If you want a longer list of such capers, see the collection of cases in 40 Loyola L.A. L.Rev. at 1146-1148.

But our favorite bit of a condemnor’s overreaching, and most appropriate on these facts, involved none other than the Los Angeles Times itself which sang a very different tune when the city took the parcel on which the Times headquarters sat but which it intended to use as a site of a new city hall. See City of Los Angeles v. Klinker, 219 Cal. 198 (1933) where the Supreme Court of California ordered the city to pay compensation for the Times’ entire shebang, including all its its fixtures like the huge printing presses which had been permanently installed and thereby became a part of the Times building. The city thought they should be moved to another location.

But after that was taken into consideration in the valuation process, the city could not afford to pay the resulting judgment, so it first tried to abandon the taking, but it came a cropper when the courts said “nothing doing” because in the meantime the Times bought another site and another set of printing presses, so if the city had been permitted to abandon the taking, the Times would have wound up with two huge printing plants. So the city was estopped from pursuing that option. See Times-Mirror Co. v. Superior Court, 3 Cal.2d 309 (1935). So, unable to pay the judgment, the city went whining to the state which bailed it out by taking the condemned site off its hands and paying that judgment. Local old timers may still remember that the old state building was built on the taken site, and the city went elsewhere to put up its new City Hall where it still sits. But not that state building; it was so badly damaged in the 1996 earthquake, that it had to be demolished.

So what’s the moral of it all? When the Los Angeles Times was itself the subject of an eminent domain taking of its property, it demanded and got every nickel of a huge verdict that the City of los Angeles literally could not pay. But when it comes to good ol’ Vinod Khosla, the selfsame Times has it (as you will see when you read Mr. Lopez’s indignant prose) that it’s OK to undercompensate him with a fraction (about 10%) of the market value of his land.

How is that for chutzpa?

CORRECTION: A sharp-eyed reader calls our attention to the fact that the NIMBYs in this case do not claim a right to use all of Khosla’s land, but only the public (below mean high tide) part thereof. Which, practically speaking, makes little difference because in order to get to the wet sand they would have to enter upon and traverse the dry, upland portion of the subject property.

FOLLOW-UP:  http://www.ktvu.com/news/222033789-story evidently has it right. It reports that the Commission offer is not for the entire property but only for 6.39 acres out of Khosla’s 49-acre parcel. Makes more sense, but the severance damages are still likely to be substantial. Stay tuned.

 

Wish We Had Said That

Checking out our colleague Robert Thomas’ blog of today, ( www.inversecondemnation.com ), we came across this gem in his explanation of the — alas, unpublished — ripeness ruling of the 4th Circuit decision in Clayland Farm Enterprises v. Talbot County (4th Cir.) Docket No. 15-1755 (Dec. 2, 2016), holding that a government entity who removed an inverse condemnation case from state court to federal court, would not be heard to argue that the case should have been pursued in state court. Quoth Roberts:

“When the government removes [an inverse condemnation] case [from state] to federal court, it shouldn’t get any traction with an argument based on the notion that the claim should [] have been brought in [state court, not in] federal court and thus isn’t ripe — the law may be an ass sometimes, but it’s not so nuts as to accept an argument that would make Leo Rosten [*] blush.”

Now, if we could only see similar blunt candor in opinions of the federal courts being asked to make similar rulings, that would be nice.

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*Leo Rosten was the author of THE JOYS OF YIDDISH, a very funny lexicon-style book of Yiddish expressions, many of which have become a part of colloquial American English. Thomas was evidently referring to Rosten’s famous definition of chutzpah as the attitude of a criminal defendant who, having killed both his parents, threw himself on the mercy of the courts because he was an orphan.

Roger Sullivan, R.I.P. — A War Story

Word has reached us a couple of days ago that Roger M. Sullivan, Esq., a great California condemnation lawyer, passed away at the age of 90.

There is an extensive obituary of Roger in today’s Los Angeles Times (12/5/16, at p. B5.). Check it out. We recommend you read it because, among other things, it will tell you about Roger the man. http://www.legacy.com/obituaries/latimes/obituary.aspx?n=roger-michael-sullivan&pid=182977886&fhid=11024

As for us, we contribute this war story about Roger the professional.

Few people know it, but it was Roger who, professionally speaking, put me on the map. Back in 1968, I lost Lombardy v. Peter Kiewit Sons’ Co. (1968) 266 Cal.App.2d 616). It was an inverse condemnation case involving proximity damages to my clients’ home from a steep upward freeway ramp. It was heavily used by large, heavy trucks, so to ascend the grade they had to downshift into lower gears, producing a high level of noise, seriously interfering with the use and enjoyment of the home.

Alas, we were demurred out of court, and the Court of Appeal affirmed, holding that (a) the state was immune to actions for nuisance, and (b) that state violation of restrictive covenants (CC & Rs) was non-compensable. The Supreme Court denied hearing, and it appeared that that was that. Except, thanks to Roger, it wasn’t.

Some time later, in 1971, as I recall, I got a call from Roger. He had read the wretched Lombardy case, and got intrigued by it to the extent of digging up and reading our briefs. They impressed him sufficiently to inspire him to call me and to ask: “I just read your Lombardy briefs. Would you like to try again?” Would I?! Surely you jest by asking. Long story short, Roger turned the file over to us, and away we went. Since our submission required a change in the decisional law, this was a case suitable for the California Supreme Court which would have to overrule its own 1909 precedent to give the nod to our client.

So off we went, predictably losing at the trial court and court of appeal level. But miracle of miracles, the California Supreme Court granted hearing and the rest became history in short order. See Southern Cal. Edison Co. v. Bourgerie (1973) 9 Cal.3d 169. And guess what? The court reexamined it earlier ruling, concluded that it had been in error (and out of step with the decisional law of other states), and overruled its own precedent as well as Lombardy on the point of compensability of CC & Rs.

And so, I wound up the winner in a precedent-breaking and precedent-making case. And I owe it to Roger who saw in my work a potential that the Lombardy judges failed to note. For that I have been grateful to him for the rest of my career. The professional compliments bestowed on me by that referral don’t come higher than that.

So thank you again, Roger. Rest in peace.

PS — But, you ask,  what about that second Lombardy holding, the one that government is immune to suits for nuisance? Actually, we got that one overruled too in Nestle v. City of Santa Monica (1972) 6 Cal.3d 920. Michael M. Berger (who handled just about every airport case before the California Supreme Court)* did most of the briefing and your faithful servant argued it before that court.

So the moral of this war story is that when your litigational ship sails, leaving you standing on the dock, that isn’t necessarily the end of it.

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* To get a better idea of his accomplishments in that field, see 4 Brigham-Kanner Property Rights Jour. at 3-11 (2015)