Demolition is abatement of a nuisance, not a taking requiring condemnation

by Victoria Heldt

Hendrix Roosevelt v. City of Detroit
(Michigan Court of Appeals, October 13, 2011)

This case deals with the demolition of a building in Detroit, Michigan.  In 2003, the City sent a dangerous building violation notice to the owners of the building after they discovered it was dilapidated, only had a half roof, and was open to trespass.   After a hearing was held, a demolition notice was sent.  At the time, Roosevelt was not on record as an owner of the building, so he didn’t receive these notices.  In 2005, Roosevelt filed a demolition deferral application and listed the building’s address as the place to send him notice.  The City granted the deferral on the condition that the building not is kept open to public trespass.  If the condition was not met, the building would be demolished without further notice.  A notice was sent to the building addressed to Roosevelt, but it was returned as Roosevelt had moved from the building.  In 2006 the City inspected the building and found it was in violation of the deferral agreement.

Roosevelt filed another deferral request in 2007 and provided 258 Riverside Drive as an address at which to reach him.  The City denied the request and sent notice both to the building’s address and to the alternative address Roosevelt provided.  Both notices were returned in the mail.  In September of 2007 the building was demolished.  Roosevelt filed a claim arguing that the demolition of the building violated the Michigan constitution, violated federal due process, and was the result of gross negligence by two City employees.  The court dismissed the federal claim and remanded the case to the circuit court to resolve the remaining claims.  On both of these claims the circuit court granted summary judgment for the City.  In 2010 the City petitioned to reopen the case in order to present a counterclaim for demolition costs.  The petition was granted, and when Roosevelt failed to oppose the demolition costs, the court awarded demolition costs to the City.  All claims made their way to the Michigan Court of Appeals.

As for the state constitution claim, the Court of Appeals laid out three main reasons why the claim was properly dismissed by the circuit court.  First, monetary damages are reserved for plaintiffs with no other avenue of relief.  Roosevelt’s first line of relief would have been via a federal due process claim, which was alleged and was denied.   The Court also noted that the City’s actions did not constitute a “taking.”  A “taking” occurs when the government confiscates property for public use.  In these instances, the government must go through the proper condemnation process.  An exception exists, however, if the property is causing a public nuisance.  Nobody has the right to use their property as a nuisance; therefore it is not considered a “taking” if the government uses its power to stop a public nuisance.  Roosevelt’s building was considered a public nuisance since it “imperiled the health, safety, and welfare” of the neighborhood.  Thus, the government did not commit a “taking” when it demolished the building.  The Court’s final point regarding this claim was that Roosevelt cannot claim a due process violation if he actually received notice.  The fact that he filed petitions for demolition deferral was evidence that he knew of the demolition plans.  Consequently, there was no due process violation.

In regards to the gross negligence claim against the municipality’s employees, the Court noted that governmental employees are protected from lawsuits if they were “acting within the scope of their authority, were engaged in the exercise or discharge of a governmental function, and their conduct did not amount to gross negligence that is the proximate cause of the injury or damage.”  In this case, the Court focused on the phrase “proximate cause.”  The Court concluded that this phrase is to be interpreted as the “most immediate and direct” cause of the action (in this case, the demolition of the building) and that it refers to one cause.  In this case another cause existed in correspondence with the demolition, namely Roosevelt’s failure to uphold the conditions of the deferral.  As a result of those factors, the employee’s actions are not deemed gross negligence.

Finally, Roosevelt challenged the circuit court’s action in assessing the demolition costs to him since state statute specifies that a judgment lien, and not a personal judgment, should be granted in demolition costs.  The Court agreed with Roosevelt and found that the trial court abused its discretion in awarding the city a personal judgment against Roosevelt.  After affirming the district court’s decisions regarding the constitutional claim and the gross negligence claim, it remanded the case for the granting of a judgment lien.

Chelsea’s (MI) failure to provide water to development violated PUD agreement

by Gary Taylor

Chelsea Inv. Group, LLC v. City of Chelsea
Michigan Court of Appeals (April 27, 2010)

Chelsea Investment Group (CIG) acquired 157 acres of undeveloped real property located in Chelsea by land contract, for which it paid $5,000,000. CIG then filed a petition to rezone the property to PUD, which the City approved contingent upon CIG meeting all terms in a PUD agreement negotiated between the city and CIG.  The agreement provided, among other things, that the development would contain 352 single-family condos. Under the agreement the city was to provide CIG with access to water for the development in a timely fashion.

CIG made an agreement with Pulte Land Company for the sale and construction of the residential units.  Pulte bought the home sites for $23,000 per lot. The development was to occur in three phases. Pulte’s purchase of the sites was conditioned on governmental approval for each phase.

Eventually, the process ran into a snag when the City determined there was not sufficient water capacity for the project.  When the resulting delays prevented Pulte from proceeding with the project Pulte exercised its option to terminate its contract with CIG.  Pulte also requested a full refund of its $250,000 deposit.

Plaintiff-CIG sued the City alleging breach of the PUD Agreement.  The trial court held that plaintiff had established a breach of the PUD Agreement, but that its damages were limited to Pulte phase two of the development.  It awarded plaintiff costs, attorney fees, and interest.  The Court of Appeals affirmed, finding that the city breached the Planned Unit Development (PUD) Agreement by not timely providing CIG (and Pulte Land Company) access to water for the development.  The damages CIG requested for inability to develop phase two were not too speculative; however, CIG was not entitled to damages as to the lost profits on phase three because development of phase three was too uncertain. The Court of Appeals found that the trial court properly dismissed CIG’s claim against the city manager personally, because his conduct was not grossly negligent, which is the standard a plaintiff is required to prove to overcome a governmental immunity defense.

Thanks to Kurt Schindler, Michigan State University Extension, for this case information. You can visit Kurt’s Land Use page here.

Subscribe

Archives

Categories

Tags

Admin Menu