Subprime mess deters property development

Posted on September 26th, 2009 by Joseph William Singer.
Categories: Mortgages.

Costco CEO Jim Sinegal complains that it is hard for the company to buy new real estate to open new stores because “in many instances nobody knows who owns the land anymore.” read article

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Designation of land as “park” or “plaza” in recorded plat creates appurtenant easement in neighbors

Posted on September 26th, 2009 by Joseph William Singer.
Categories: Servitudes.

A developer sold properties in a subdivision on the island of Martha’s Vineyard in Massachusetts, after recording a map of the area showing the lots and the streets. Three irregularly-shaped areas that wereabout five times the size of the lots on the map were labeled as”parks” and one was called a “plaza.” Those properties were never developed and remained wooded over the years. The lots were all sold but not in the manner envisioned on the map; many lots were grouped together so that the average parcel is now about the size of the parklots. Fifty years later, an owner of the “plaza” lot sought to sell it to an buyer who wanted to build a single-family home on it. The neighbors sued, arguing that the designation of the property as a plaza meant that they owned an negative easement prohibiting development of the lot for residential purposes and an affirmative easement to use the lot for park purposes. The plaza owner argued that the writing of the word “plaza” on the map was not sufficient to constitute an express oran implied easement limiting the uses to which the property could be put. In addition, the subdivision was created before it was common to create homeowner’s associations, so if the park lots are privately owned but subject to an appurtenant easement in all the neighbors, itis not clear how the parks will be maintained, who would pay for  that maintenance, or how disputes about their use would be resolved. The Appeals Court held that the writing on the map was insufficient to impose an easement on the property but the Supreme Judicial Court reversed.

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Palazzolo remand

Posted on September 26th, 2009 by Joseph William Singer.
Categories: Takings.

On remand, the Rhode Island trial court found that development of Palazzolo’s salt marsh land south of a shallow, tidal pond would constitute a public nuisance because it would inhibit the “valuable filtering system regarding water runoff containing pollutants and nitrogen from adjacent land.”  Palazzolo v. State, 2005 WL 1645974, at*3 (R.I. Super. Ct. 2005). The court also found that half of theproperty was below the mean high water line, making it tidal land subject to the public trust doctrine which defines such lands as owned by the public and not subject to private development at all. Finally,the court found that, although one upland site could be developed,almost none lower lots could ever have been profitably developed because of the extraordinary engineering costs involved in draining thesite and preparing the site to support structures. Thus, there was notaking of property.

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No taking to prevent construction on a floodplain

Posted on September 26th, 2009 by Joseph William Singer.
Categories: Takings.

The Supreme Judicial Court of the Commonwealth of Massachusetts held that it was not a taking to prevent an owner from building a house on a floodplain when construction would exacerbate flooding to neighboring property. Gove v. Zoning Bd. of Appeals of Chatham, 831 N.E.2d 865 (Mass. 2005).

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Legislative Responses to Kelo

Posted on September 26th, 2009 by Joseph William Singer.
Categories: Takings.

In response to the Kelo decision, almost all states have passed legislation or constitutional amendments that limit the power of municipalities to take property for economic development purposes. Elisabeth Sperow, The Kelo Legacy: Political Accountability, Not Legislation, Is the Cure, 38 McGeorge L. Rev. 405, 418-422 (2007). The legislation limiting eminent domain powers falls into several categories; some states passed laws in just one of these categories and others passed more than one type of limitation. First, some states repudiated Kelo by prohibiting the use of eminent domain to take property from one person to transfer it to another person if the taking is for economic development purposes, such as increased tax revenue or additional jobs. See, e.g., Alaska Stat. §§09.55.240(d), 29.35.030; 735 Ill. Comp. Stat. 30/5-5-5(c); Me. Rev. Stat. tit. 1, § 816; N.H. Rev. Stat. § 162-K:2(IX-a)(b); Vt. Stat. tit. 12, § 1040(a). Second, some states adopted Justice Thomas’s literal approach by prohibiting all takings of property from one private owner for transfer to another unless the property is open for public “use,” meaning public ownership or access. See Fla. Stat. § 73.013; Iowa Code §§6A.21 to 6A.22; N.H. Rev. Stat. § 162-K:2(IX-a)(a); Tenn. Code § 29-17-102(2). Third, many states passed laws prohibiting takings unless the property being taken is “blighted,” raising health or safety concerns. Ala. Code §§ 24-2-2, 24-3-2; Cal. Health & Safety §33030; Iowa Code §§6A.22; Mo. Rev. Stat. § 523.271; Wis. Stat. § 32.03(6). See Centene Plaza Redevelopment Corp. v. Mint Properties, 225 S.W.d3 431 (Mo. 2007) (finding insufficient evidence of blight to justify the taking). Fourth, some states regulate takings by procedural measures designed to increase public participation in the process through more hearings or better public notice or through requirements that the taking authority present evidence sufficient to justify the taking. See 735 Ill. Comp. Stat. 30/5-5-5(d); W. Va. Code § 16-18-6. Fifth, some states require higher compensation than the usual “fair market value” if a person’s home is taken. Ind. Code § 32-24-4.5-8(2)(A)(owner of a residence entitled to 150% of fair market value; owner of a business entitled to “any loss incurred in a trade or business that is attributable to the exercise of eminent domain”).

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Constitutional Limitations on Takings in Oregon & Arizona

Posted on September 26th, 2009 by Joseph William Singer.
Categories: Takings.

On Nov. 2, 2004, the voters adopted a state law known as Measure 37 that required compensation when any regulation “restricts the use of real property” and is enacted after an owner or a family member acquires title to land if the regulation “has the effect of reducing the fair market value of property” unless the regulation restricts activities “commonly and historically recognized as public nuisances under common law” or protects “public health and safety, such as fire and building codes, health and sanitation regulations, solid or hazardous waste regulations, and pollution control regulations.” Or. Stat. §195:305; Michael C. Blumm & Erik Grafe, Enacting Libertarian Property: Oregon’s Measure 37 and Its Implications, 85 Denv. U. L. Rev. 279 (2007). The measure applied both to statutes and to zoning ordinances. See Or. Stat. §195.305 to 195.314. Because the law applies to any regulations passed after an owner (or a family member) acquired title, present owners may go back to the laws in effect at the time their family first acquired the land – for some families, this may go back to a time before any zoning or environmental laws were in effect. This “inheritance right” would mean that zoning in a particular area would be inconsistent if acquired by different families at different times, making each parcel might be subject to different land use regulations. For this reason – and because it turned out that deregulating neighboring property might lead to a strip mall next to one’s house and even have the effect of reducing the value of one’s home – Measure 37 proved unpopular in various respects and was substantially modified when the Oregon voters passed Measure 49 on Nov. 6, 2007. Measure 49 eliminated the “inheritance right” and restricted Measure 37 claims to laws that restricted restrict residential, farm or forest uses of property, while allowing, without compensation, laws that limit commercial or industrial uses like strip malls and mines. Measure 49 also limited the number of homes that may be built on property freed from regulation by Measure 37. Claimants may build up to three homes if home construction was allowed when they acquired their properties, whether or not the post-acquisition restriction on construction reduced the value of their land; they may build four to ten homes if a post-acquisition regulation reduced their property value; however, they may not build more than three homes on high-value farmlands, forestlands and groundwater-restricted lands. And Measure 49 capped at twenty the number of homes sites any owner may build through Measure 37 waivers of land use laws regardless of the number of property she owns. In 2006, Arizona passed an act similar to Measure 37, known as Proposition 207 or the Private Property Rights Protection Act. Ariz. Stat. §12-1134.

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