West-Richardson Condemnation Trial to Feature Condemnation Blight Defense

We are gearing up for a May 2008 trial in the North Key Largo condemnation blight case, State of Florida v. West, et al. We originally responded to the State's condemnation complaint with an inverse condemnation counterclaim, alleging the State and County had created a "condemnation blight" situation on North Key Largo in 1982. After the State exercised a quick-take in 2004, it gave up the right to "walk away" from the condemnation if it didn't like the price. We moved for a pre-trial order on condemnation blight, which was granted in April 2007. (Click on the link above to view the Order and a chronology of the case.)

On January 18, 2008, in a 3-hour hearing, the State tried to convert our condemnation blight claim -- which requires valuing the property as of the 2004 quick-take date (when title passed to the State), but valuing it as if the 1982 regulations were still in place and the blight never existed -- into a de-facto taking claim. In a de-facto taking, where the owner is actually ousted from the property, the property is valued as of the date of the ouster. In this case, that would have been February 9, 1982. Then interest is added on for the 28-year "delay" in payment. The Court rejected that argument. The appraisers will calculate Fair Market Value as of the "date of taking" in 2004, and as if the regulatory environment was the same as it was on February 8, 1982. They will also assume that the possibilities of rezoning will be as it was in 1982, not as it was in 2004.

This is a significant case for the owners of undeveloped property in the Florida Keys. Although the North Key Largo blight is very easy to prove, and the State's heavy hand easy to demonstrate, there is a blight in existence throughout the Keys. Landowners need to know that they can demand much higher prices for their unbuildable land than the paltry sums the State and County are offering.

Judge Ready to Dismiss Unripe Taking Case on Statute of Limitations Grounds

On Dec. 1, 2007, we submitted a proposed order denying Monroe County's motion to dismiss in Sutton v. Monroe County.

The County's statute of limitations argument defies the U.S. Supreme Court's decision in Williamson County v. Hamilton Bank (1985), where the Court held that a landowner cannot pursue a regulatory taking claim without first giving the local government an opportunity to change its mind -- and obtaining a final decision regarding what use that governmental entity will allow on the subject property. This final decision is necessary to ripen the landowner's taking claim.

Monroe County's theory that Florida's 4-year statute of limitation for bringing a regulatory taking claim begins to run at the moment the local government denies a "development order" (i.e., building permit, plat approval, etc.), stands in direct opposition to the Supreme Court's decision in Williamson County. The denial of the "development order" is only the beginning of the ripening process.

After landowners have been turned down on a permit application or, in the Florida Keys, after they read the land development regulations and comprehensive plan and find that development is theoretically prohibited on their property -- landowners must request a Beneficial Use Determination (BUD) from the County. This brings each individual taking claim to the attention of the County's legislative body, the County Commission.

The BUD process is designed to produce the Williamson County "ripeness" decision. It allows the County Commission to override any County Land Development Regulation or Comprehensive Plan provision, in order to avoid liability for a regulatory taking. If the County tells landowners to drop dead, they are free to sue for the regulatory taking, i.e., their claim has "ripened."

In the Sutton case, Ms. Sutton applied for a building permit in 1997 and was denied. She appealed that denial to the Planning Commission to no avail. She did not request a BUD decision until 2005, eight years later.

Even though there is no time limitation on filing in the BUD Ordinance, nor in the Comprehensive Plan Policy that mandates the procedures in the Ordinance, the County would like to retroactively create one. The County also fails to notice that Florida's statutes of limitation do not apply to quasi-judicial, local government, administrative proceedings. A landowner may, for whatever reason, wait 5, 25, or 50 years before requesting a BUD.

The unacceptable alternative would allow local governments to adopt confiscatory regulations, and then sit back and wait for 4 years to pass, only to allow the government to obtain "effective" title to the property without having to pay for it. The drafters of our Constitutions were not that stupid -- if the government wants it, it must pay for it!

Landowner wins $37 million taking award

The owner of 24 oceanfront acres in the City of Half Moon Bay won a $36.8 million Inverse Condemnation award on Thursday (Nov. 28, 2007) following a nine-day trial in the U.S. District Court for the Northern District of California. The City had -- by "borrowing dirt" from the property in 1983-84 -- created man-made wetlands on the property. It then refused to repair the damage it had done, then refused to allow the owners to repair the damage.

In 1990 the City approved a tentative subdivision map for the property. In March 1991, the City imposed a 4-month development moratorium while it improved its sewer system. To pay for the upgrade, Plaintiffs were hit with a $962,988 sewer connection lien in 1994. After 11 extensions of the "4-month" sewer-based moratorium, it ended on March 31, 1998 (7 years later). The actual STP expansion was not completed until November 1999.

In May 2000, the City rejected Plaintiffs' application for final approval to build the subdivision, because "new wetlands" (that the City had created) had "suddenly appeared" since 1990. (Readers will kindly note the passage of 16 years since the City created the "new" wetlands.)

On Nov. 28, 2007, U.S. District Court Chief Judge Vaughn Walker entered a 167-page Order styled "Findings of Fact & Conclusions of Law," holding the City of Half Moon Bay liable for the "taking" of the subject property, determining the compensation to be paid to Plaintiffs as $36,795,000, plus interest, attorney fees, and expenses. The Court also enjoined the City from collecting any future payments on the sewer connection lien.

December 2007 Litigation Updates

We have six Regulatory Taking cases pending. Collins et al. v. Monroe County et al. (appeal); Galleon Bay Corp. v. Monroe County et al. (new trial); Lightner et al. v Monroe County et al. (BPK & NNK); McCole v. Marathon and Beyer v. Marathon (answers filed); and Sutton v. Monroe County (motion pending).

Answer briefs are due Dec. 10 in Collins. In Galleon Bay, several motions are set for Dec. 5. The Lightner Class Action Complaint is pending amendment. McCole and Beyer are ready for summary judgments on liability. The gov't motion to dismiss Sutton on statute of limitation grounds was heard Nov. 14 and we are awaiting an order.

We have a Direct Condemnation case pending, Florida DEP v. West et al. On Nov. 8, the gov't claimed the case could not be tried in the time available in November, so Judge Garcia postponed the trial to May '08. In this case, we prevailed on a Condemnation Blight motion on April 9, and Judge Garcia ordered the property appraised under the regulations in effect on Feb 8, 1982.

We have two lawsuits in preparation, Gutierrez et al. v. Monroe County et al, and Evanoffs v. Islamorada et al. These are Regulatory Taking cases that will also challenge a number of other land development regulations and ComPlan provisions in the County and the Village.

Remember, additional details and copies of pleadings, motions, and orders can be found on http://mattsonlaw.com/.

BUD Petition filed

On behalf of the Group Two plaintiffs, we filed a petition on Thursday, November 29, 2007, requesting an administrative hearing on the Dept. of Community Affairs proposed final order approving Monroe County's proposed ordinance 35-2007, which would amend the Beneficial Use Determination (BUD) process by adding several years, and thousands of dollars, to the process (which the US Supreme Court has held we must go through before filing a taking suit), and by eliminating any administrative compensation remedy (not that the County has ever offered to pay fair market value, anyway). Until this process ends, the existing BUD ordinance will stay in effect. A copy of the petition will be posted later today on http://mattsonlaw.com/.

Condemnation Blight in the Florida Keys

Since 1986, Florida Keys landowners have watched government acquire the vacant property next door for 10 cents on the dollar. There are about 8,000 Keys landowners who haven't given away their property for next to nothing, but that number decreases every day. This phenomenon has a name. It's called Condemnation Blight. It happens when government decides to acquire property for preservation purposes, but doesn't appropriate sufficient funds to pay Fair Market Value for the property it wants to control.

If you are getting letters from the State's hired land thieves, don't make the mistake of assuming you have no choice other than accepting the State's low-ball offer. Just saying "no" is a good start. You don't have to sell at a discount if you don't want to.

But then don't make the mistake many have made before you -- hiring some out-of-the-Keys eminent domain lawyer. They don't understand the condemnation blight situation in the Keys -- and they don't want to.