Category: Uncategorized

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 Harford undercompensated a property owner whose land it took by some $3 million. The city deposited $ 1.98, 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.

_______________________________

*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.

_________________________________

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

Happy Thanksgiving!

Not much to say, except to re-emphasize, if any additional emphasis were needed, that we have much to be thankful for, and even if you are one of those folks who think that the just past election was a calamity, it was a free election of a free people choosing their leadership. Don’t forget that!

And if you have any foolish doubts on that score, remember that all the truly unhappy people in the world want to abandon wherever they are and come here — not the other way around.

So enjoy your turkey and have a very happy Thanksgiving

And Now, For a Word From the Prophet

It’s been a few months since we ventured out of our eminent domain/land use law corner of the legal world, and into the never-never land of politics. We did not support or oppose either candidate, but we did try our best to confront the tidal wave of ideological bullshit sweeping over us, and to explain why Trump was doing so well. Our intention was to clarify why the people were so strongly — and as it turned out, overwhelmingly — in favor of Donald Trump’s presidential candidacy. Whether you like him or not, it was clear to us that in his angry rhetoric railing against the political establishment on both sides, he was on to something and whatever that “something” was — it resonated mightily with the people who were getting sick and tired of (a) getting screwed by the political establishment, and (b) being lied to about it.

We endorsed no one in that article, but we did our best to explain — correctly, as it turned out — why Trump’s crude, in-your-face, aggressively hostile electioneering rhetoric was resonating with the non-establishment people.

So if you missed our article, here it is, and if you read it already, it won’t hurt you to read it again in light of yesterday’s presidential election results. Go to http://gideonstrumpet.info/2016/03/our-latest-column-the-trump-candidacy/

 

City to the Times: Do We Really Own All that Land? Gosh. Who Knew?

Here we go again, folks. Way back in the 1960s, the California Supreme Court gave its blessings to condemnors engaging in “excess condemnation” — i.e., the takings of more land than the condemnor’s own project plans called for. See People v. Superior Court (Rodoni) (1968). There the court concluded by a 5 to 2 majority that it was OK for the state to take over 50 acres of land out of Roy Rodoni’s farm for what its own plans required as a 5-acre right-of-way segment. Why would the state do a damn fool thing like that, you ask? Because, as they told the California Supreme Court, it would save money. How? Their explanation was that by taking the entire farm they wouldn’t have to pay severance damages for the taking of only those 5 acres. This was, of course, ridiculous, because the taking of the entire 50-plus acre larger parcel would require payment of 100% of its value — the maximum. So how could the state save money by paying the maximum? But hey man, it was California in the heyday of its supreme court’s belief that a condemnor could do no wrong, so the court largely went along with the gag, and allowed the state to proceed.

Why the majority of the California Supreme Court bought that absurdity, remains a mystery.

To their credit, Justices Mosk and Peters dissented, pointing out not only the arithmetical absurdity inherent in the state’s position, but also taking note of the fact that the state conceded that it had been using threats of excess condemnation to extort favorable settlements.

However, we learned some time later that the California Little Hoover Commission examined the state’s “excess land” program and revealed that far from saving money on excess land, the state had acquired and was sitting on millions of dollars worth of land that it could neither use nor sell.

Now, we learn from the Los Angeles Times that a similar caper is going on in Los Angeles. Alice Walton and Ben Poston, L.A. Learns It Owns 9,000 Parcels, Oct. 28, 2016, at p. B1. According to the Times, the City Controller has done an investigation of the city’s land holdings and — surprise, surprise — discovered that the City holds some 9600 parcels of land (no indication of how that land was acquired) using a tracking system that is “incomplete, inadequate, outdated, in some cases incorrect.”

One of those “parcels” is a 17,500-acre tract of land that the city acquired back in the 1970s for a grandly named, but eventually failed “Intercontinental Airport” out in the boondocks in the high desert, near Palmdale, for which it paid over $100,000,000 — and that’s in 1970s dollars. (http://gideonstrumpet.info/2008/11/update-on-palmdale-airport/)

And for a comic touch — in case you aren’t snickering already — in the latest caper, the city was surprised to learn that it owned inter alia a producing orange grove in Franklin Canyon, that is “surrounded by multimillion dollar homes.” Said a city functionary quoted by the Times: “I don’t know why the city is in the orange growing business,  but apparently we are.” However, we bet that those homeowners aren’t complaining. It isn’t every day that someone surrounds your multimillion dollar home in a posh neighborhood with a fragrant orange grove.

What is to happen to all that unused land for which the city paid a pretty penny out of your tax dollars, the Times tells us not. But be patient. Maybe some time in the future the city will think of something. Then again, it may not. So as we are fond of concluding some of our posts that deal with similarly daft government capers, your tax money at work.

 

Words Without Comment

A quote from Matthew Hennessey, Hartford’s Big Dig, Oct. 1, 2016:

“In Connecticut as in the rest of the country, massive interstate construction projects followed President Dwight Eisenhower’s signing of the Federal-Aid Highway Act of 1956. Cities like Hartford were then suffering massive traffic congestion problems, as rising postwar incomes spurred a boom in individual car ownership. In 1949, several major insurance companies asked the engineering firm Andrews and Clark to compile an “Arterial Plan for Hartford” under the direction of New Haven native Robert Moses. “Doctors, we are told, bury their mistakes, planners by the same token embalm theirs, and engineers inflict them on their children’s children,” wrote Moses in a cover letter. It was an oddly prophetic warning from a man blamed by many for ruining New York City with his car-dependent infrastructure projects.”

For the entire article go to http://www.city-journal.org/html/hartfords-big-dig-14779.html

We might add, however, for the benefit of readers who are too young to remember these things, that the official justification for constructing the interstate highway network was defense: to facilitate military transportation in case of need. Tue, we have never seen (or heard of) Abrams tanks clanking down an Interstate, but, hey man, who are we to argues with our betters?

More Redevelopment Bad News — Washington, DC

If you keep track of takings for redevelopment, you may have come across news of Skyland, a major redevelopment project in Washington, DC, in the Southeast part thereof. It was supposed to be a big hotsy-totsy project anchored by Walmart, with the usual projections of a rosy future. Something like this:

The Skyland Town Center property is now in the hands of the development team.

But as is so often the case, things didn’t work out as hoped. Long story short, Walmart pulled out of the deal, and the project has so far, produced another one of those urban deserts that looks more like this:

 

And this is the good part. Much (most?) of the project area looks more like an urban desert; like this:

http://www.skylandtowncenter.com/webcamlive.html

To be fair, the project promoters claim that they will build another, smaller project but whether and how they will actually do it remains to be seen, particularly since the economy appears something less than robust at the moment. This project has been pending for over 10 years, and if these pictures are any indication, there is not much to brag about here.

We will try to follow up on this story, but for some reason, it has not been covered to speak of in the major newspapers. And so it goes.

Another Not-So-Hot Redevelopment Project — Brooklyn

Remember the hulabaloo over the Atlantic Yards project? How it would revive Brooklyn, etc.? The latest dispatch from that front from the New York Times, no less, indicates that it hasn’t been beer and skittles. We will quote from the Times, and let its words speak for themselves,

“[A local] pizzeria sits in the shadow of the $4.9 billion megadevelopment once known as Atlantic Yards, which has promised to deliver thousands of new residents and visitors to the area since it was proposed in 2003. But so far, the biggest change . . . Vanderbilt Avenue merchants have seen is rising rent.”

“The project has been troubled by delays, financial setbacks, lawsuits, and political wrangling. And the opening of the Barclays Center, the centerpiece of the development, in 2012, did not deliver substantial new business to Vanderbilt despite expectations that it would.” Rhonda Kaysen, A Long Wait for New Neighbors on a Brooklyn Street, N.Y. Times, Aug. 31, 2016, at p. B5.

And so it goes. Predictably. As California Court of Appeal Justice, Macklin Fleming  once put it: redevelopment project promoters promise they’ll bake a bigger economic pie, with bigger slices for all. But what they often tend to produce is pie in the sky. Of course, the NY Times does the same by duly reporting that in the sweet bye and bye good things will happen. We will await the event and see how it turns out if we are still around then.

For the full NY Times article go to http://www.nytimes.com/2016/08/31/realestate/merchants-wait-for-the-promise-of-vanderbilt-avenue-and-wait.html?ref=business