Eminent Domain | Condemnation

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Check this out: the lawprof who thought up the underwater mortgage taking plan, Cornell’s Robert Hockett, along with his co-author, the “Founder and Chief Strategy Officer” of Mortgage Resolution Partners (the venture capitalists who are funding the scheme and who stand to benefit from it), have posted a new article in the Harvard Law & Policy Review, “A Federalist Blessing in Disguise: From National Inaction to Local Action on Underwater Mortgages.”

One guess what the article concludes.

In case you have not been paying attention, here’s the abstract:

While it is widely recognized that the mortgage debt overhang left by the housing price bubble and bust continues to operate as the principal drag upon U.S. macroeconomic recovery, few seem to appreciate just how locally concentrated the problem is. This paper takes the measure of the national mortgage debt overhang problem as a cluster of local problems…

Continue Reading Surprise – New Article In Mortgage Resolution Partners Law Review: Use Of Eminent Domain To Take Mortgages OK!

A very short opinion (2 pages) about why a trial court cannot consider issues regarding damages when the property owner failed to timely object to the report filed by the court-appointed appraisers. In Clark Cnty. Bd. of Aviation Comm’rs v. Dreyer, No. 10S01-1308-PL-529 (Sep. 12, 2013), the Indiana Supreme Court held it was not because the failure to object deprived the trial court of jurisdiction, but only because … well, you didn’t object. Forfeiture, waiver, whatever you want to call it, we suppose.

Not much there, folks, but we posted it anyway because how often do see a Supreme Court admit that the language in its own earlier opinion “is misleading?”

Clark Cnty Bd of Aviation Commissioners v. Dreyer, No. 10S01-1308-PL-529 (Ind. Sep. 12, 2013) Continue Reading Indiana S Ct: We Goofed

It’s Monday and we’ve got a petition due Tuesday, so we’re not going to spend too much time on posting today. But we did want to update you on the latest on the mortgage front.

  • A San Francisco federal judge concluded that it was too early to bring the lawsuits challenging the takings. This means that the case is just not quite ripe (although it looks like it is ripening fast), not, as some media outlets have been reporting, that the judge approved of the MRP/Richmond eminent domain scheme. 
  • Our Florida colleague Carlos Kelly sends this report from the “Legal Scoop on Southwest Florida Real Estate,” a publication of his firm. Read his Update: Condemnation of Underwater Mortgages here. Many good links to other stories and reports.
  • An Arizona reader sends this item, “Using

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Continue Reading The Latest On The Mortgage Takings Issue

 Norfolk

Earlier today, the Virginia Supreme Court, in PKO Ventures, LLC v. Norfolk Redevelopment and Housing Authority, No. 121534 (Sep. 12, 2013), invalidated takings of non-blighted properties which were part of a larger area designated as blighted.

In 2007, Virginia adopted a statute requiring that if property is taken to eliminate blight, the property itself must be blighted. That might seem like an obvious proposition, but as readers certainly know, since the U.S. Supreme Court’s decision in Berman, it has been ok to take the baby with the bathwater under the Fifth Amendment, and as long as a legislator rationally could have believed that taking a perfectly fine property would somehow help alleviate other blight, then the courts would not stand in the way.

The Virginia statute defines “blighted property” as one that is in bad shape “at the time of the filing of the petition for condemnation,”…

Continue Reading Virginia S Ct: No Taking Of Non-Blighted Property That Happens To Be In An Area Designated “Blighted”

Dwight Merriam, familiar to our readers for the items of interest he frequently forwards, as a co-author of a recent brief in the New York rent control case, chapter author in the seminal eminent domain treatise Nichols on Eminent Domain, for being the editor of the ABA’s annual “Cutting Edge” land use books, the author of “The Complete Guide to Zoning” (which could be our favorite book on the subject), and the moderator of perhaps the most well-attended legal teleconferences on the planet (we understand this recent example had over 800 participants), has authored “Eminent Domain for Underwater Mortgages: A Cure Worse Than the Disease?,” a piece for The Abstract, the magazine of the American College of Mortgage Attorneys. 

It’s a good quick summary of the facts in the case of the plan for the city of Richmond, California to…

Continue Reading Merriam On Taking Underwater Mortgages: “Lindsay Lohan has a greater chance of staying out of trouble than the city of Richmond”

Missouri has a peculiar statute that we wish were more widespread. In 2006, state legislators adopted the “heritage value” statute requiring courts award an additional 50% over fair market value as just compensation when property owned by a family for more than 50 years is taken by eminent domain. Thus, when heritage property is taken, the owner is entitled to 150% of fair market value.

We like.

Congratulations to our Owners’ Counsel colleague Robert Denlow for defending the heritage value statue in the Missouri Supreme Court in St. Louis Cnty v River Bend Estates Homeowners’ Ass’n, No. SC92470 (Sep. 10, 2013), a decision which, among other things, resulted in the court upholding the statute against a constitutional challenge. The two main claims of illegality were that (1) the legislature went outside of its authority and defined just compensation to mean “too much,” and (2) the payment of the heritage…

Continue Reading The Descendants Win A Just Compensation Case In The Missouri Supreme Court – “Heritage Value” Statute Is Constitutional

University of Hawaii lawprofs Carl Christensen and Williamson Chang have kindly asked me to visit their Legal History of Hawaii class (Law 520D) on Thursday, September 19, 2013, and guest lecture on the topic of “Land Reform and the ‘Public Use’ Factor in Eminent Domain: Midkiff, Kelo, County of Hawaii v. C & J Coupe.”

In preparation for that session, here’s the reading list:

If you have additional time, read these two briefs as well:

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Continue Reading Reading List For Sept 19 Guest Lecture For Hawaii Legal History Class

Here’s the cert petition filed earlier this week, asking the Supreme Court to review the Ninth Circuit’s decision in MHC Financing Ltd. P’ship v. City of San Rafael,714 P.3d 1118 (9th Cir. 2013).

That’s the case in which the Ninth Circuit overturned the District Court’s ruling (after two trials) that MHC had proven a Penn Central taking and was entitled to just compensation for the City’s mobilehome rent control ordinance. The panel’s rationale was that MHC purchased the mobilehome park with the oppressive regulations already in place, so it had no “investment backed expectations” of operating free of the regulations.

We posted our thoughts on the Ninth Circuit’s ruling here, so we won’t go into the details of the cert petition, except to note two things:

  • We didn’t get how the Ninth Circuit just ignored Palazzolo. We still don’t.
  • The second Question Presented (below) is particularly fasinating.

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Continue Reading New Regulatory Takings Cert Petition: 9th Circuit Made Hash Of Penn Central

According to this story in the San Francisco Chronicle, “Eminent domain plan may have spooked investors,” Richmond, California’s plan to take underwater mortgages by eminent domain “Wall Street spurned its efforts to refinance its highly rated municipal bonds [A-minus rating], an unusual snub that cost the city nearly $4 million in lost savings.”

“Paying Paul and robbing no one”, indeed. Continue Reading Well, Who Didn’t See This Coming?

In Rockies Express Pipeline LLC v. 4.895 Acres of Land, No. 12-3069 (Aug. 15, 2013), the condemnor was a gas pipeline company delegated the power of eminent domain under a federal certificate of public convenience and necessity, and the property owners were the owners of several coal mines.

They disagreed about the danger posed to a surface pipeline by coal mining. The pipeline company thought there wasn’t a problem, the coal companies thought otherwise. They  believed that once the pipeline was operational, the agencies that regulated coal mining would either delay or deny the required coal extraction permits and ultimately drive them out of business, even though under Ohio law the coal companies had a right to subside the surface. So the coal companies accelerated their coal mining, and eventually sought to recover from the condemnor pipeline company the costs associated with doing so.

Applying Ohio law (condemnations under…

Continue Reading 6th Cir: Coal Company Did Not Show It Was “Reasonably Foreseeable” That Coal Regulators Would Deny Mining Permits To Prevent Danger To Gas Pipeline