Tag: Condemnation

Shared driveway resulting from DOT condemnation may be undesirable, but does not constitute a taking

hdankbar

by Hannah Dankbar

Bailey v Wisconsin DOT
Wisconsin Court of Appeals, April 23, 2015

Bradley and Caroline Bailey appealed the circuit court’s dismissal of their takings claim against the Wisconsin DOT. The Baileys claimed that the DOT took part of their land that resulted in a change in access to their property and left them with an “uneconomic remnant” which, according to Wis. Stat. 32.05(3m) means that the “property remaining is of such size, shape or condition as to be of little value or of substantially impaired economic viability.”

The DOT condemned two parcels of the Baileys’ property as part of a highway construction project.  As part of this project the DOT moved the Baileys’ driveway and created a new access point from the highway. The Baileys claimed that the DOT’s actions left them with an “uneconomic remnant,” but the circuit court dismissed the complaint.

The Baileys first argued that the circuit court erred because the DOT failed to make a prima facie case that the “Baileys’ property had reasonable access after condemnation.”  The DOT responded that the question of reasonable access is separate from, and plays no part in a determination whether an uneconomic remnant exists under the statute.

The Court of Appeals dismissed the Baileys’ argument over any supposed stand-alone “reasonable access” issue. Instead it focused on whether the change in access left the Baileys with an uneconomic remnant. The Baileys submitted four affidavits in support of this claim: one by the Baileys’ attorney, two by individuals the Baileys listed as experts, and one by Caroline Bailey. The circuit court excluded everything in the attorney’s and experts’ affidavits based on lack of foundation and other admissibility factors.  Caroline Bailey’s affidavit was the exception. She stated that they now shared a driveway with a neighbor whom they find difficult and threatening, and with whom they believe they will be unable to agree on driveway maintenance.  The Court of Appeals found that this only demonstrated that the Baileys’ situation is undesirable; not that the remaining property is “of little value or of substantially impaired economic viability.”

Because of these reasons the Court of Appeals affirmed the circuit court’s dismissal.

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Minnesota Buy-the-Farm statute gives landowner discretion in determining size of parcel to be condemned

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by Hannah Dankbar

Great River Energy v David D. Swedzinski
Minnesota Supreme Court, March 4, 2015

Great River Energy (GRE) is part of the CapX2020 project, which involves installing a high-voltage transmission line from South Dakota to Minnesota. GRE sought easements of land from Minnesota landowners following Minn. Sta. §216E.12, which gives public utilities the power of eminent domain for their projects. Dale and Janet Tauer are landowners of one of the affected properties (218.85 acres) that they have leased out for farming.

In 2012 GRE first notified the Tauers about its intent to condemn a permanent 8.86-acre easement and a temporary 3.38-acre easement. The Tauers elected to compel GRE to purchase the entire property under Minn. Stat. § 216E.12, subd 4, also known as the “Buy-The-Farm” statute.  The statute gives landowners subject to condemnation proceedings the option to compel the utility to condemn a fee interest in the landowner’s entire parcel of contiguous, commercially viable land, which would make GRE the outright owner of the entire 218 acres.

The relevant section of the Buy-The-Farm statute reads:

When private real property that is an agricultural or nonagricultural homestead, nonhomestead agricultural land, rental residential property, and both commercial and noncommercial seasonal residential recreational property, as those terms are defined in section 273.13 is proposed to be acquired for the construction of a site or route for a high-voltage transmission line with a capacity of 200 kilovolts or more by eminent domain proceedings, the owner shall have the option to require the utility to condemn a fee interest in any amount of contiguous, commercially viable land which the owner wholly owns in undivided fee and elects in writing to transfer to the utility within 60 days after receipt of the notice of the objects of the petition filed pursuant to section 117.055.

GRE did not need, nor want to own the entire parcel in fee simple and so argued to the district court that when the court rules on a landowner’s election under the Buy-the-Farm statute the court must consider other factors in addition to the factors listed in the statute, including the overall reasonableness of the election.

The Minnesota Supreme Court acknowledged that it utilized a “requirement of reasonableness” in a prior case under the statute; however, the Court noted that since that case was decided there have been amendments to the statute. Those amendments limit the factors for courts’ consideration to whether the parcel is “contiguous, commercially viable, and nonhomestead agricultural land.”  Courts cannot inject a “reasonableness” test, nor can the courts consider whether the landowner lives on the parcel, as GRE also argued.  Furthermore, the “in any amount” language leaves the parcel size determination up to the landowner, and does not give the Court discretion to determine the reasonableness of the amount for condemnation.

The Supreme Court affirmed the lower courts’ rulings in favor of the Tauers.

 

 

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Installation of traffic light considered a general benefit in calculating condemnation award

Gary Taylor

by Victoria Heldt

City of Maryland Heights, Missouri v. Robert J. Heitz and Loretta Tucker
(Missouri Court of Appeals, November 1, 2011)

Heitz and Tucker have owned a 12-acre piece of property in Maryland Heights, Missouri since 1961, when it was surrounded by vacant land.  Heitz constructed a building to house Heitz Machine and Manufacturing and built a private drive down the center of the property that ran from Dorsett Road to the building.  Subsequently, Interstate 270 was constructed to the west of the property and developers showed an interest in purchasing it for commercial or retail use.  Heitz showed no interest in selling the entire parcel, but came to an agreement in the early 1980’s with Charles Drury, Sr. that provided Drury two and a half acres of land on which to build a Drury Hotel in exchange for Heitz becoming a limited partner in the venture.  The construction of the hotel still left a portion of Heitz’s property vacant along Dorsett Road.

Heitz continued to receive offers to purchase the remaining land including one from Mr. Drury who expressed interest in building another hotel on the remaining portion of the land.  It was his custom to convert older Drury hotels into Pear Tree Inns and then construct a new Drury Hotel nearby.  Another offer was received from the Edward D. Jones Company which had developed a North Campus in Maryland Heights.  The campus covered 50 acres of land to the southeast of the intersection of Dorsett Road and Interstate 270.  Edward D. Jones wanted to expand but was unable to do so due to the current configuration of the Dorsett-270 intersection.  The intersection next to the Jones campus (Dorsett Road and Progress Parkway) was very near to Interstate 270 and caused traffic congestion.  Jones sought to relocate Progress Parkway and formed a redevelopment plan with the City in 2002 which included building a public road over Heitz’s property.  Heitz claimed to have no knowledge of the City’s development plan.  Jones made yet another offer to Heitz to purchase the property since he would need an entrance to his campus from Dorsett Road.

Eventually, a portion of the Heitz property was condemned.  The private drive that the Heitz’s previously built that provided access to Heitz Machine would be made into a four-lane public road and two traffic signals would be constructed as outlined by the redevelopment plan.  The City valued the property at approximately $1.2 million.  Heitz disputed the valuation in the condemnation proceedings.  Heitz felt the compensation was not sufficient.  His property was less valuable from his perspective because Drury no longer had an interest in purchasing it for another hotel once the size of his remaining parcel was reduced.  The City felt the plan actually improved the property’s value, and that thus the damages were excessive.  Each party brought witnesses to testify to the value of the land.  The court awarded damages of approximately $1.8 million to Heitz.

The City brought seven claims on appeal, the first regarding the court’s finding that a traffic light is a general benefit.  They argued that it provided a special benefit and should be used to offset damages to Heitz.  They purported that the stoplight increased the property’s “accessibility, visibility, frontage, and connectivity” and that it lessened the cost of future commercial development.  Heitz argued that it did the opposite since it removed the property’s access to Dorsett Road.  The Court found that it was indeed a general benefit for three reasons.  First, a special benefit is derived from the specific location of the improvement.  Since the benefit would still exist of the stoplight was placed elsewhere in the area, it is not specific.  Second, the Court found that the traffic signal is a “secondary, necessary byproduct of the construction of the road,” so it is unable to confer an individual, specific benefit.  Third, the stoplight did not result in a vested right since the City could remove it whenever it saw fit.  For those reasons, the benefit could not be construed as special.

The City’s second argument challenged Mr. Drury’s testimony, inasmuch as Heitz failed to list him as an expert witness.  The Court found Drury did not need to be classified as an “expert witness” since he was merely discussing his prior dealings with Heitz and his knowledge of that specific piece of property.  The remainder of the City’s complaints challenged the admissibility of other expert witnesses and claimed errors in Heitz’s cross-examination and closing argument.  The Court denied all remaining points and affirmed the condemnation award.

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Maps provided to landowner sufficiently accurate representation of land ultimately condemned

Gary Taylor

By Victoria Heldt

Krupicka v. Village of Dorchester
(Nebraska Court of Appeals, October 11, 2011)

Krupicka farms a 160-acre plot of land outside the Village of Dorchester.  The Village of Dorchester owns a wastewater treatment plant on the property adjacent to the northeast portion of Krupicka’s land.  In October 2008, the Village notified Krupicka that its wastewater treatment plant must undergo alterations and expansions in order to meet federal and state standards.  The letter specified that the expansion (new lagoons) would need to take place on a portion of Krupicka’s land and that the Village was prepared to negotiate a purchase agreement.  Krupicka met with the Village’s attorney (Gropp) regarding the acquisition in October 2008 and then in December of 2008 Krupicka received an official offer letter.  The letter informed Krupicka that the Village desired to purchase 40 acres of Krupicka’s land at $2,200 per acre.  The initial plan consisted of four new lagoons placed on a portion of land north of a creek that ran through Krupicka’s property.  Krupicka hired representation (Hemmerling) and requested a meeting with Gropp in order to discuss alternative plans.

In January of 2009 Krupicka met with Gropp and the project manager, who explained that the project required a 35-40 acre plot of land and needed to be finalized by September of that year.  Krupicka expressed concerns about his ability to use his pivot irrigation system on the land near the lagoons.  Another meeting was held in February of 2009 at which Krupicka suggested the lagoon site be moved to the south side of the creek running through his property.  After the Village’s superintendent of sewer, water, and electrical completed research regarding the alternative location of the lagoons, Krupicka received a letter stating it would not be feasible.  The letter, received in March 2009, included images of the acceptable future location of the lagoon and contained the following warning:  “Dimensions are approximate & will vary.  Area shown = 35.0 acres.”  Sometime shortly afterwards, Krupicka received a similar letter in which the area shown was equal to 36.7 acres.

Later that month Hemmerling, on behalf of Krupicka, sent a letter to Gropp rejecting the $2200 per acre offer and countered with a $10,000 per acre offer.  Gropp rejected this offer and countered with a $3,650 per acre offer “for the land in the northeast quarter of…Krupicka’s land.”  In August, Krupicka attended a Board meeting at which he requested a postponement of the decision regarding the lagoons.  The Board said it was not possible due to the September 1 deadline and reiterated its offer of $3,650 per acre.  Krupicka walked out of the meeting.  At the same meeting the Board authorized the condemnation of approximately 37 acres of Krupicka’s land on which to build three lagoons.  A witness at the meeting could not recall whether this took place before or after Krupicka left.  Gropp testified that he provided Krupicka with a copy of the final plan, but Krupicka claimed he never received it.  Gropp sent a “Petition for Condemnation and for Appointment of Appraisers” to Hemmerling.  Attached to this letter as a reference was an image of the plan included in the April 2009 letter to Krupicka and not the most recent plan.  Gropp said this was because he had sent his only copy of the most recent plan to Krupicka, and he provided one later that month to the appraisers.  The appraisers valued Krupicka’s damages at $160,000 (or $4,311 per acre.)  Krupicka later consented to a temporary construction easement for consideration of $8,500.

In district court, Krupicka alleged that the $160,000 was not adequate and that the condemnation of his property was invalid since there were no good faith negotiations prior to it.  The court found that the Village did indeed enter into good faith negotiations before condemning the property.  Krupicka appealed.  After clarifying that it does have jurisdiction to decide the case, the Court of Appeals addressed Krupicka’s claim.  At the heart of the claim, Krupicka argued that the good faith negotiation requirement was not met because he never received a legal description of the land to be condemned and therefore the condemnation was invalid.  In order to satisfy the statutory requirement of good faith negotiation, “there must be a good faith attempt to agree, consisting of an offer made in good faith and a reasonable effort to induce the owner to accept it.”  He did not want the land returned to him (as the treatment facility construction had already begun) but instead wanted more compensation.

Krupicka relied on Prairie View Tel. Co. v. County of Cherry as precedent.  In that case, the County of Cherry sought to condemn property in order to build a county road.  The only form of negotiation was a letter addressed to the landowners.  The letter informed them that since they failed to appear for negotiations as formerly requested and since the County was unable to find them at their home on one occasion, the County was offering $3,000 as consideration.  The Court held that an offer in good faith was not made since the county never discussed how much land it was going to take.

The Court noted that the facts in Prairie differed greatly from the facts in this case.  The Village indicated “with reasonable clarity” how much land was to be taken.  In addition, it sought Krupicka’s input regarding the location of the lagoons in the initial planning stages.  Although it was unclear as to whether Krupicka received the final draft of the plan for the lagoon, the other three drawings he did receive showed a portion of land that was in “essentially the same location as the portion of Krupicka’s land that was ultimately condemned.”  For these reasons, the Court affirmed the district court’s decision.

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No property interest exists, when no building permit application has been filed

Gary Taylor

by Victoria Heldt

American Central City, Inc., v. Joint Antelope Valley Authority
(Nebraska Supreme Court, June 17, 2011)

Edward Patterson, the owner and sole shareholder of American Central City, Inc. (ACC), owned three properties and claimed a compensable property interest in properties owned by Edward and Dorothy Schwartzkopf, which are located in the same neighborhood.  Patterson based his claim of interest on an option to purchase the Schwartzkopf’s property on the condition that he obtain a building permit.  He planned to construct a building that would sit both on his property and on theirs.  All of these properties were condemned as a part of the Antelope Valley project, which was designed to provide Lincoln with flood control, transportation improvements, and community revitalization.   Patterson claimed he was not properly compensated after the condemnation of the properties and that his substantive due process rights were affected during the trial process.

Patterson argued that he had a compensable property interest in a building permit he wanted to obtain because he spent considerable time and money planning and designing the building.  He claimed that city officials falsely informed him that it would not be possible to build underground parking or place underground telecommunications on the property, and that this information prevented him from going forward with this plans and affected his substantive due process rights.  The Court noted that the granting of a building permit does not give a property owner the right to build or a property interest in the permit.  The Court further recognized that Patterson never actually filed for the permit.  In light of this, it concluded that that the law does not recognize a property interest in a permit that was  never filed.

Patterson also claimed an interest in the Schwartzkopf properties because of the 1995 option to purchase.  Once Patterson failed to obtain a permit, both parties signed a release agreement excusing them from performance.  Then in 2004, the property was sold to JAVA.  Patterson claimed he still had an oral agreement to buy the property even after the release was signed in 1995.  The Court found that he had no compensable interest in the property because the oral agreement would not stand up in court.  The sale of land is subject to the statute of frauds and must be in writing.  Patterson further argued that his case falls under one of the exceptions to the statute of frauds (partial performance) since he incurred expenses and invested time in the planning and designing of the building.  The Court found that any oral agreement Patterson had was with the Schwartzkopf’s, and cannot be enforced against JAVA.

Patterson further argued that the government engaged in inverse condemnation, which means that the government took property without proper compensation or proper condemnation proceedings.  He claimed the government prevented him from putting his property to the “highest and best use” by preventing him from obtaining a building permit and that this qualified as inverse condemnation.  Without the building permit, he could not purchase the Schwartzkopf properties in order to develop his properties as planned.  The Court noted that this claim rested partially on the belief that he had a property interest in the building permit and the Schwartzkopf properties, but as stated earlier he did not.  Additionally, it found that Patterson did not submit sufficient facts to establish that the government acted to prevent him from developing the land.

The Court dismissed all of Patterson’s claims and affirmed the decision of the district court.

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Court of Appeals finds another “nearest feasible route”

Gary Taylor

by Gary Taylor

Edward A. Green and Melvin J. Green, v. Wilderness Ridge, LLC
(Iowa Court of Appeals, May 11, 2011)

This case is a continuation of two previously reported cases, an Iowa Supreme Court case decided January 8, 2010,  which itself was an appeal of an Iowa Court of Appeals case decided May 29, 2009  (see the Court of Appeals case for a full account of the facts).  The 2010 Iowa Supreme Court case vacated the earlier Court of Appeals decision concerning the ability of the owner of a landlocked parcel to access that parcel over the land of another, using the “nearest feasible route to an existing public road.” as required under Iowa Code 6A.4(2).  The courts were essentially given two routes to choose from – a northern route and a southern route.  The Supreme Court found that the term “nearest feasible route” required a consideration of reasonableness, focusing on the impacts on both parties.  The Supreme Court remanded to the trial court, noting that it is incumbent on the courts to consider the value of the land to be condemned in determining the specific route for providing access.  

On remand, the district court condemned the northern route, relying on the Greens’ real estate experts who opined that the southern route would be costly and disruptive to the farming operation. Wilderness Ridge appealed, arguing the Greens’ evidence did not support the condemnation damages alleged. Giving due weight to the district court’s factual findings and considering both the ease of constructing the road and its harm to neighboring properties, the Court of Appeals in the present case agreed the northern approach is the “nearest feasible route.”
The Court relied on testimony from two farm realtors that fencing off the access road along the southern route would significantly reduce the value of the Greens’property by as much as $190,000. Other testimony substantiated that even if fencing was not required, would take a toll on their farm in other ways. Construction of the road itself will alter the crop field borders and point rows which will shrink the productive capacity of the land. A real estate broker estimated that the reduction in tillable acres alone from construction of the southern route would cost the Green brothers as much as $27,500 over the next twenty years. The evidence also suggested that building an access road along the southern route would change the drainage patterns of the adjacent farm fields.

The Court of Appeals affirmed the determination of the district court.

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Expert’s testimony in takings case lacked foundation and should have been excluded

by Melanie Thwing

Glaize Creek Sewer District v. Gorham
(Missouri Court of Appeals, March 22, 2011)

Gary and Sheila Gorham live in Jefferson County, Missouri. In 2008 Glaize Creek Sewer District filed a petition in condemnation to acquire a permanent sewer easement and a temporary construction easement that would run through the Gorham’s back yard. This easement would be fifteen feet wide and 161 feet long.

During construction Glaize Creek utilized a thirty foot wide temporary easement to store equipment. Glaize Creek also cut down trees in the back yard as well as cutting the roots of at least nine trees, altered the grade of the back yard and left a permanent manhole.

The Gorham’s filed for damages with the trial court. Mrs. Gorham is a certified state appraiser and testified about the property. She found, according to Uniform Standards of Professional Appraisal Practices (USPAP) that the property diminished $29,000 after the project was complete.

It was noted in her testimony that the loss of trees allowed commercial properties to be seen at night, there was now an inability to build a pool or any other improvements over the sewer line, there was a loss of marketability of property during the actual construction, and the back yard was now in a “torn-up condition.” All of these resulted in a permanent diminution in the value of the property.

Glaize Creek also called a certified real estate appraiser to testify. However, this expert did not see the property prior to construction and did not inspect the entire property. He stated his purpose was to find if there was an impact on the property from the easement, not the value of the entire property. He testified that there was no adverse affect to the property.

The Gorham’s then asked that the expert testimony from Glaize Creek be stricken because the opinion did not measure damages and the difference in value before and after the taking. This objection was overruled and the jury returned the verdict of $0.00.

The Gorham’s appealed to the Missouri Court of Appeals, first arguing that the trial court abused its discretion when the expert testimony was allowed. They claim the testimony failed to address the proper measures of damages, was irrelevant, lacked foundation, and served only to confuse the jury. The Court of Appeals noted that it will not generally second-guess the conclusion of the trial court on the admissiblity of expert testimony, but in cases where the sources relied on by the expert are “so slight as to be fundamentally unsupported,” the testimony should be excluded from consideration.  Missouri law, § 523.001(1) states that in partial takings the measure of compensation is “the difference between the fair market value of the entire property immediately prior to the taking and the fair market value of the remaining or burdened property immediately after the taking.”  The expert from Glaize Creek testified that he did not assess the fair market value of the entire property before and after the easement. Instead he visited the property after the project was completed. In his testimony no data was presented as to how he reached the conclusion that no value was lost. On the other hand, Mrs. Gorham testified that she used comparable sales methods and presented reasons for the diminution in property value.  The Court of Appeals found that Glaize Creek’s expert testimony must be excluded because it is not founded on any rational basis and without substantial information and is mainly speculative.

By failing to take into account the value of the property prior to the easement the testimony lacked foundation and should have been excluded. The judgment of the trial court was reversed and the case was remanded for a new trial.

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Condemnee allowed to dismiss condemnation action over objections of redevelopment authority

by Melanie Thwing

Wisconsin Mall Properties, LLC v. City of Green Bay
(Wisconsin Court of Appeals, January 4, 2011)

The Redevelopment Authority of the City of Green Bay, Wisconsin wanted to condemn a department store that was owned by Mall Properties, but leased to Younkers. Under Wisconsin Statute § 32.05 (3) the Redevelopment Authority offered compensation to both Younkers and Mall Properties.

Under this statute, if an offer is not accepted, the Redevelopment Authority makes an automatic award to the condemnee and Mall Properties and Younkers’ were awarded the amount that was originally offered. § 32.05 then allows the condemnee two courses of action to appeal the award: (1) appeal to the condemnation commission or (2) appeal directly to the circuit court. If an appeal is taken to the condemnation commission both parties have a right to appeal, however if it is taken to the circuit court then the condemning authority does not have this right.

After choosing to appeal in circuit court, and after intensive litigation with Younkers’, Mall properties filed a voluntary dismissal of the condemnation appeal under § 805.04(1) which states, “[A]n action may be dismissed by the plaintiff without order of court by serving and filing a notice of dismissal at any time before service by an adverse party of responsive pleading or motion…”

The Redevelopment Authority wished to increase the awarded amount (the court’s opinion does not state a reason for the Redevelopment Authority’s position)  and opposed the voluntary dismissal. Mall Properties request was ultimately rejected by the circuit court, who stated that public policy would not allow for the voluntary dismissal. They stated, “Is it…proper to prohibit the condemning authority from having their day in court?…when taxpayer dollars are at issue, it is not unreasonable… the taxpayers also have a right to have that valuation determined.”

Mall Properties appealed this decision to the Wisconsin Court of Appeals. The Court of Appeals looked to Dickie v. City of Tomah which ruled on § 32.06 – a sister statute to § 32.05 – for guidance.  In Dickie the court ultimately gave the right of voluntary dismissal to plaintiffs, noting that the main difference between these two statutes is that unlike in § 32.05 where the Redevelopment Authority automatically makes an award, in § 32.06 an offer that is not accepted is then directed to the condemnation commission to issue an award. Because the condemnation commission is controlling the award in § 32.06 both parties have the right to file an appeal, a right not given under § 32.05.

The Redevelopment Authority argues to the court that Dickie cannot be used under both statues because there is no option for an appeal to ensure, “the award of compensation is proper.” Taking this argument, the court points that the option for appeal is given under § 32.06 because the condemnation commission controls the awards, and the appeal process enables a fair award. However, it is the Redevelopment Authority who determined the value of the award, and if they were allowed to appeal, it would be the same as asking for protection against their own decisions. The court also points that the condemnor still has the option to join the first appeal from the condemnee.  Thus the Court of Appeals reversed the trial court’s order, and allowed Mall Properties to voluntarily dismiss the proceedings. 

Finally, the court looks to the issue of public policy that was stated by the circuit court. To court does agree that both property owners and taxypayers have a right to have the value of compensation determined. This opportunity was given to the Redevelopment Authority when they determined and funded the award. The court finds that no public policy requires an opportunity to challenge an agency’s own valuation. The case is reversed.

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Land condemnation for deceleration lane not for “economic development” purposes

Gary Taylor

by Allison Arends

John V. Haltom v. City of Omaha
(Nebraska Court of Appeals, January 26, 2010)

The City of Omaha, in an attempt to install a deceleration lane for traffic that would access a new retail development, negotiated with John Haltom and another property owner to obtain a strip of land. When the negotiations failed, the City filed a petition to condemn Haltom’s property. Haltom and the other property owner were awarded a total of $55,300 from the “Report of Appraisers”. Haltom filed a complaint  arguing that Neb. Rev. Stat. 76-710.04 prohibited the City from exercising it’s eminent domain powers to acquire land for the purpose of economic development. The City filed a motion for partial summary judgment in response. At the summary judgment hearing the city engineer provided an affidavit in which he explained that his recommendation for the installment of the deceleration lane was primarily for purposes of traffic control and safety. The district court granted the City’s motion for summary judgment. Haltom appealed.

The court first addressed the issue of whether Haltom’s appeal was moot since his property had already been condemned and the deceleration lane had been built. However, because (1) the lane was determined to be a public issue (2) municipal authorities desiring to condemn property rely upon authoritative adjudication for future proceedings and (3) condemnation proceedings are replicated and identical in most cases, this case was found not moot under the public exception rule.

In his appeal, Haltom argued that the district court erred in determining that the City did not condemn his property for economic purposes. Furthermore, Haltom specifically argues the City directly violated statute 76-710.04 because the deceleration will (1) provide vehicles access to the retailer and (2) ultimately cause the expansion of the City’s property and sales tax bases through providing the retailer’s customers easier access to the retailer’s parking lot therefore exercising eminent domain for the purpose of economic development.

In response to Haltom’s claim the court cited the plain language of the statute, specifically noting section 76-710.04(1) which prohibits the use of eminent domain powers where taking is, “primarily for an economic development purpose.” Using this section the court found four reasons to reject Haltom’s argument. First, the City did not take the property for the use by a commercial for-profit enterprise. Second, the City’s acquisition of the land did not serve the primary purpose of increasing tax revenue or tax base. Third, the City’s acquisition of the land did not serve primarily for increasing employment. Finally, the use of the property cannot be understood as primarily related to “general economic conditions”. The court acknowledged that the City’s use of eminent domain may have resulted in incidental and indirect benefits to the retailer, but those benefits do not constitute a violation of statue 76-701.04 since it was not the City’s primary concern in the construction of the deceleration lane.

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“Nearest feasible route” requires reasonable consideration of costs to both landowners

Gary Taylor

by Gary Taylor

Green v. Wilderness Ridge, L.L.C.
(Iowa Supreme Court, January 8, 2010)

The Iowa Supreme vacated an earlier Court of Appeals decision concerning the ability of the owner of a landlocked parcel to access that parcel over the land of another, using the “nearest feasible route to an existing public road.”  Readers can go to The BLUZ blog post on the Court of Appeals decision, which can be accessed here, for a review of the facts.   

Iowa Code 6A.4(2) gives the owner of a landlocked parcel the right to exercise eminent domain over the land of a neighbor if it is necessary to gain access to a public road.  The code provision lays out criteria for exercising that right that include locating the access “along a line which is the nearest feasible route to an existing public road”  In this suit, the owners of the servient estate (the land across which the easement would cross) argued that the route suggested by Wilderness Ridge (owner of the landlocked parcel) (1) did not lead to a public road, and (2) did not consider the costs to the servient estate for allowing that route.  The Court of Appeals determined that the route selected by Wilderness Ridge did lead to a public road and would pose fewer costs to Wilderness Ridge than the route offered by the owners of the servient estate, and for that reason allowed condemnation of the route preferred by Wilderness Ridge. 

The Iowa Supreme Court disagreed with the Court of Appeals’s finding that Dudley land was a public road for purposes of Iowa Code 6A.4.  While the road could theoretically be located by it’s designation on old plats, Dudley Lane has never physically existed.  The purpose of the statute is to provide access to landlocked parcels, and providing access to a public road that exists on paper only does not meet legislative intent. 

The Supreme Court also found that the term “nearest feasible route” required a consideration of reasonableness, focusing on the impacts on both parties.  Thus it was incumbent on the courts to consider the value of the land to be condemned in determining the specific route for providing access.

Considering these findings the Supreme Court remanded the case to district court for further fact finding related to the location of the nearest public road and the costs of acquiring a route thereto.

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