Tuesday, February 17, 2009
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C.A. Clarifies Requirements for Exercise of Eminent Domain
By KENNETH OFGANG, Staff Writer
A public entity’s failure to specify—in the resolution of necessity—the public use to which property taken by eminent domain is to be put cannot be cured by putting the land to public use after it is taken, the Third District Court of Appeal ruled Friday.
The justices faulted the City of Stockton for the manner in which it took two parcels on the North Shore of the Stockton Deep Water Channel as part of a plan to develop a multi-use complex, including an arena and minor league baseball park.
They reversed a final judgment and awarded litigation expenses to the former owner, Marina Towers LLC. But they concluded that it would be equitable to allow the city to pass a new resolution of necessity.
North Shore Project
The original resolutions, enacted in 2003, said the project for which the land was taken was the acquisition of additional land on the north shore, that the North Shore was a “catalyst site” for redevelopment of a larger area, that it was necessary to merge parcels in the area into a single parcel in order to feasibly redevelop the area, and that the project would complement other efforts to revitalize that part of the city.
After enacting the resolution, the city promptly filed a complaint in eminent domain and obtained a writ of immediate possession. The owner answered, objecting, in part, on the ground that the resolutions of necessity “fail to sufficiently identify the public use for which the property is to be condemned.”
A San Joaquin Superior Court judge denied the owner’s motion to stay possession, finding that Marina Towers was unlikely to prevail on its objections. By the time the case came to trial in 2005, the ballpark and a public parking lot had been built on the property.
Judge Bob W. McNatt eventually ruled that Marina Towers was not entitled to damages for improper precondemnation activity. The case went to a jury on the issue of valuation, and Marina Towers was awarded $1.97 million.
Resolutions ‘Woefully Lacking’
Justice M. Kathleen Butz, writing Friday for the Court of Appeal, said the resolutions of necessity were “woefully lacking” in identifying the public purpose for which the property was being condemned.
“Rather than referring to a specific statute, the resolution simply trots out a laundry list of statutes setting forth a plethora of possible purposes for condemning property,” the justice wrote. “This global, yet evasive enumeration constitutes an implied admission that the city council does not yet know to what use it intends to put the property.”
Butz distinguished Anaheim Redevelopment Agency v. Dusek (1987) 193 Cal.App.3d 249, in which the court permitted a redevelopment agency to take property based on a cursory statement that the land was taken “for the elimination of blight and for redevelopment purposes.”
Butz noted that the property in that case was taken under the Community Redevelopment Law, which specifies the redevelopment of blighted areas as a sufficient basis for condemnation. Stockton, she noted, did not take the Marina Towers property under the CRL.
Butz went on to say that the trial judge erred in ruling that the taking was lawful because the property was ultimately used for a public purpose.
“If the trial court’s reasoning were correct, no legal challenge could ever be raised against an inscrutable and meaningless resolution of necessity, as long as the governing body put the property to public use after it was condemned,” the justice wrote. “However, the entire objective of requiring a resolution of necessity is to ensure that the public entity makes a careful and conscientious decision about the need for the project and the need for the property before it condemns private property. This purpose would be eviscerated if the validity of a resolution of necessity could be validated by post hoc events.”
Under the Eminent Domain Law, Butz went on to explain, where condemnation is unlawful, the court may order either an unconditional dismissal—meaning the property reverts to the owner—or a conditional dismissal, pursuant to which the condemning entity may keep the property if it complies with the conditions set by the court, which may include payment of the property owner’s litigation expenses.
The justice reasoned that because the property is now being used for a public purpose, and because the taxpayers have financed expensive improvements, it would be inequitable to require that the property be returned to the former owners. Instead, Butz concluded, the action should be conditionally dismissed, and the city should be required to pay Marina Towers’ litigation expenses, adopt new resolutions of necessity, and file a new eminent domain action, in which the property owner may seek a higher valuation.
The case is City of Stockton v. Marina Towers LLC, 09 S.O.S. 883.
Copyright 2009, Metropolitan News Company