Oral argument in Condemnation Blight case

Oral argument was had Monday, June 22nd, in Key West, before Florida's Third District Court of Appeal, in the Condemnation Blight case of Florida DEP v. West, et al., that resulted in a $6.9 million judgment for two parcels that the state "quick-took" for $630,000 in 2004. (Details on MattsonLaw.com) The panel included Chief Judge Gersten and District Judges Suarez and Rothenberg. Judges Gersten and Suarez were on the panels in Collins v. Monroe County and Shands v City of Marathon one year ago (June 30, 2008). The Landowners prevailed in both Collins and Shands, and Judge Suarez signed both opinions.

It was obvious that Judge Rothenberg had read the briefs. She came out of the box at the State's attorney (for whom this was the first appeal he had ever briefed or argued) when he presented his theory that "this is not 'condemnation blight,' but was a regulatory taking in 1982." Judge Rothenberg punctured the State's balloon when she referred to the holding in Tahoe-Sierra -- that moratoria are "temporary takings," and that temporary takings do not accrue until they end. So much for the State's statute of limitations theory.

The West case is a superb example of condemnation blight. We thank Gideon Kanner for his life's work in this area. Most Florida Keys condemnation cases have been "lightly defended" by mainland Florida eminent domain lawyers (with one major exception, Doug Halsey), who had no clue what happened from 1982 forward. However, as Senior District Judge Alan Schwartz said in one of our oral arguments several years ago, "the courts don't exist to protect people from the use of their pens." We realize most owners of condemned Florida Keys properties could have used the condemnation blight strategy we used in this case, but their attorneys were unfamiliar with the facts on the ground.

Chief Judge Gersten asked both sides if they considered the State's theory of the case "fair." My response is obvious. The State's response was "I will not say this is fair, but we are governed by laws."

One of those laws is the Fifth Amendment to the United States Constitution, and that "law" requires the government to act in a fair and equitable manner when it condemns property (or does anything else). Keep checking back to learn how this comes out. The Third District Court of Appeal releases its decisions on Wednesdays, at about 10:30 AM.

U.S. Supreme Court disqualifies W Va Supreme Court Justice on due process grounds

Today, in an astounding decision -- not because it was unexpected, but because all four "conservative" Justices dissented -- the Supreme Court reversed a West Virginia Supreme Court's decision because one Justice refused to recuse (disqualify) himself. See Caperton v. A. T. Massey Coal Co., Case No. 08-22 (U.S., June 8, 2009).

For those who missed the news coverage of this case, Caperton obtained a $50 million judgment against Massey. Massey appealed to the W. Va. Supreme Court. Meanwhile, one Brent Benjamin was challenging an incumbent Justice seeking re-election. Massey Coal's chairman, Don Blankenship, contributed $3 million to Mr. Benjamin's campaign. Mr. Benjamin was successful, and became Justice Benjamin. (Note added June 16: Only $1,000 went directly into Mr. Benjamin's campaign account, the other $2.999 million was spent on advertising on Mr. Benjamin's behalf.)

Caperton moved to disqualify Justice Benjamin, and the Justice refused to recuse himself. The supreme court reversed Caperton's $50 million judgment,on a 3-2 vote. One dissenter, Justice Starcher, wrote:

The majority opinion is morally wrong because it steals more than $60 million dollars from a man who was the victim of a deliberate, illegal scheme to destroy his business. The majority opinion is legally wrong because it uses erroneous legal reasoning to justify an immoral result.

The supreme court vacated its first effort and re-heard the case. Two Justices (including Starcher, J.) disqualified themselves. They were replaced by two trial court judges. The result was the same, 3-2 in favor of Massey. Three months later, Justice Benjamin released a 98-page concurring opinion that attempts to justify his refusal to disqualify himself.

The Supreme Court granted certiorari, and oral argument was held on March 3, 2009 -- just three months ago. The Court's swing-vote, Justice Kennedy, delivered the opinion, joined by Justices Stevens, Souter, Ginsburg, and Breyer. I've posted a link to the Court's opinions (Justices Roberts and Scalia filed dissenting opinions), and if you can read this you can read the opinions.

The dissents of Justices Roberts, Scalia, Thomas, and Alito are disturbing. While we are seeing a fair amount of conservative hand-wringing over Judge Sotomayor's nomination to the Supreme Court, we should not forget that "conservative" judges often side with the government -- except in land use cases, thank goodness. Judge Sotomayer would at least keep the balance when other (non land-use) Constitutional rights are at stake.

Suffice it to say that the Supreme Court's decision in Caperton v. Massey adds weight to the judicial disqualification process throughout the state and federal courts, in its renewed application of the Due Process Clause, in addition to statutory criteria, to support motions to disqualify judges.

Condemnation Blight Oral Argument Set

For those who can get to Key West on June 22, 2009, Florida's 3rd District Court of Appeal has scheduled oral arguments that day in Florida v. West, et al., in the new Key West courthouse. This is the 2008 "condemnation blight" decision that required the State to pay ten times its "good faith deposit," in 2004, for two parcels of land on North Key Largo that have been under a development moratorium since February 9, 1982!

Updated May 31, 2009. Please check our website, http://mattsonlaw.com, to read the briefs before you make the trek to Key West. The State's Initial Brief is available, as is our Answer Brief, on the website. The State's Reply Brief is due on or before June 15, 2009.

Ms. Ahearn's $25 Million Eminent Domain Verdict

Gideon Kanner posted this four days ago, about a 101-year old landowner who may have gotten even with the local government. Then the Eminent Domain Law Blog picked it up last Friday, and it's just too good to pass up.

The landowner, 101-year old Ms. Ahearn, had been offered $25 million for her golf course property some 10 years ago, and the local government (Evergreen Park, Illinois) killed the deal by refusing to rezone the property. Then, as luck would have it, the town decided to acquire the property by eminent domain ... offering $5 million. The jury, however, after 30 minutes of deliberation, came back with $25 million -- the amount Ms. Ahearn would have received 10 years ago.

Now comes the difficult part. As in Florida, Illinois apparently allows the condemning authority to "walk away" if it doesn't like the jury verdict. It pays costs and attorneys' fees, but that doesn't do much for the landowner.

We have an analogy to Ms. Ahearn's case here in the Florida Keys -- Florida DEP v West, et al. The West case is pending in the Florida Third District Court of Appeals, after a jury came in at $5.06 million in an eminent domain proceeding where the State put up only $550,000. We represent the landowners in West, and are defending the appeal. But we have a leg up on Ms. Ahearn -- as the State "blinked" and filed a "quick-take" almost at the height of the real estate bubble in 2004. The State of Florida cannot "walk away" on this one.

The State of Florida filed the West condemnation proceeding in 1995, as a slow-take (like Ms. Ahearn's in Illinois). We responded with a regulatory taking counterclaim, figuring the State would run like a scared rabbit if a jury came in at 10 times what the State was offering back then. At the least, the taking counterclaim could be pursued if the State decided to bail out of its slow-take. Fortunately, the State blinked in 2004, and we converted the counterclaim into a motion in-limine on condemnation blight.

Federal Circuit Finds Fifth Amendment Taking by Endangered Species Act

In Casitas Mun. Water Dist. v. United States, 543 F.3d 1276 (2008), rehearing denied, 556 F.3d 1329 (Fed. Cir. 2009), the US Court of Appeals for the Federal Circuit reversed the Court of Federal Claims -- opinion at 76 Fed. Cl. 100 (2007) -- holding that an uncompensated taking under the Fifth Amendment has occurred.

... there is no doubt that the preservation of the habitat of an endangered species is for government and third party use -- the public -- which serves a public purpose. .... when the government forces Casitas to divert water away from the Robles-Casitas Canal to the fish ladder for the public purpose of protecting the West Coast Steelhead Trout, this is a governmental use of the water.

Every environmental NGO in the country filed amicus briefs in Casitas. Though I haven't read them all, it's just the same old song -- "endangered species are entitled to more Constitutional protection than are citizens of the United States." That just ain't so, and the Federal Circuit has so held.

This brings me to Monroe County's latest fiasco on Big Pine Key and No-Name Key. The County and the State of Florida teamed up to develop a BPK-NNK Habitat Conservation Plan to "protect" the endangered key deer and the Playboy marsh rabbits, that prohibits essentially all use of approximately 1,000 acres of undeveloped, privately-owned land. This confiscatory County/State HCP was submitted to the US Fish & Wildlife Service as part of an application for an Incidental Take Permit. Always happy to accept land donations, the USF&WS issued the ITP -- that recites verbatim the conditions in the County/State HCP.

The problem with this scenario is that the County and the State did not have any ownership interest in the land they donated to the F&WS to "save" the key deer and Playboy bunnies. Ooops? You bet! The only difference between the BPK-NNK HCP and Casitas Mun. Water District v. United States is that Casitas is a physical taking (because the water is physically taken from Casitas and given to the fish) and BPK-NNK is a regulatory taking.

Meanwhile, we have a class action lawsuit pending in state court (Lightner, et al. v. Monroe County and the State of Florida), alleging a regulatory taking of those 1,000 acres on BPK-NNK, that should benefit substantially from this excellent decision by the US Court of Appeals for the Federal Circuit.

As we see it, the County and State can rescind their confiscatory regulations and pay temporary taking damages to those who have sought development approvals since the regulations went into effect. Or they can pay out more than $200 million in compensation for a permanent taking of 1,000 acres on Big Pine Key and No-Name Key.

PS. The US Court of Federal Claims (CFC) has exclusive jurisdiction over all inverse condemnation claims -- in excess of $10,000 -- brought against the United States. The Federal Circuit Court of Appeals hears all appeals from the CFC. Yours truly has been admitted to practice before the CFC since 1985, and the Federal Circuit since 1990.

NOTE ADDED August 10, 2009. The U.S. Solicitor General (Elena Kagan) requested two extensions of time to file a petition for certiorari in Casitas Municipal Water District. The second extension ended July 17, 2009 -- 24 days ago -- and no petition has been docketed by the Supreme Court. Looks like the Casitas battle goes to the property owners.

Voice of Reason Recipients Getting the Message

Five weeks after mailing the latest Voice of Reason to every owner of Tier I land in unincorporated Monroe County, responses from all over the country have been strong. One-third of the affected landowners reside outside Florida; another third live in Florida but outside Monroe County; the other third reside in Monroe County.

We have been getting e-mails and telephone calls every day from landowners who have resisted the State's siren invitations to buy their land for pennies on the dollar. Almost without exception, these landowners have no clue what their property would be worth in a proper eminent domain proceeding. But ... these are individuals who have rejected State offers for years, and are willing to fight. The faint-hearted sold out long ago.

We continue to tell Keys landowners that they are opposing one of the United States' most intransigent enemies of landowners -- local governments that are captives of the homevoters that elect them.

If you have not received a Voice of Reason in the past six weeks, it is likely that the Monroe County Property Appraiser does not have your current address on file. You can resolve this by calling or writing the Property Appraiser to correct your mailing address. You will then receive the next Voice of Reason in the mail. That is because we use the Property Appraiser's database to build our mailing list. (To download the March 2009 issue, click on the title of this post.)