Eminent Domain Decisions Around the Nation

Five significant eminent domain decisions were decided in 2006 from Rhode Island, Connecticut, Pennsylvania, Maryland and Minnesota.  Four of these decisions deal with economic development and, notably, two of them invalidated a municipality’s exercise of eminent domain.  Statutory definitions of blight were also addressed by several cases.   

State Development Corporation Improperly Used Eminent Domain to Increase Revenue  

A state economic development corporation did not have a valid public use for its taking of an airport parking garage in Rhode Island Economic Development Corp. v. The Parking Co., 892 A.2d 87 (R.I. 2006).  The Economic Development Corporation (EDC) had previously entered into an agreement with The Parking Company whereby the company would construct a parking garage on land adjacent to the airport and would, in return, operate the garage for a twenty year term.  The EDC became concerned about the operation of the company’s garage and was unable to reach a strategic agreement with the company to change its operation.  The EDC then acquired title through a quick-take procedure. 

The court acknowledged the EDC’s ability to take land for economic development, but stated that the city’s actions amounted to “hasty maneuvering" and failed to take the careful preparatory measures for an economic redevelopment plan required by Kelo v. City of New London, 125 S. Ct. 2655 (2005).  The court held that the EDC’s condemnation of The Parking Company’s garage was not a legitimate pubic purpose because it was motivated primarily from a desire to increase revenue.  The court found that this was a particularly egregious violation of the public use requirement because the parties had an existing contractual relationship whereby the EDC could buy out the company’s interest in the garage according to a set schedule.  This led the court to conclude that the EDC was attempting to get around its obligation to buy out The Parking Company’s interest by using its eminent domain power.

Municipality Has Broad Authority to Take Non-Substandard Property within Redevelopment Area

The Supreme Court of Connecticut upheld the ability of redevelopment agencies to take productive property within an established redevelopment area in Maritime Ventures, LLC v. City of Norwalk, 2006 WL 910059 (Conn. 2006).  The plaintiff, who owned an automobile dealership within a redevelopment area, challenged the city’s ability to take non-substandard properties without considering integration of such properties into the redevelopment area. 

The court first stated that if a property cannot be integrated into an overall redevelopment plan, then the acquisition of the property is “essential to complete an adequate unit of development plan.”  Id. at *5.  Because automobile dealerships were not listed as a permitted use in the redevelopment plan, and the court found the city had no duty to list prohibited uses, the plaintiff’s property could not be integrated into the redevelopment area.

Redevelopment Authority’s Condemnation Violated Establishment Clause

The Commonwealth Court of Pennsylvania recently held that the Redevelopment Authority of the City of Philadelphia did not have the power to condemn blighted property in order to turn it over to a religious organization.  Redevelopment Authority of the City of Philadelphia, 891 A.2d 820 (Pa. Commw. Ct. 2006).

The area in which the condemnee’s property is located was certified as blighted in 1968.  The Hope Partnership, a collaboration of two religious organizations, proposed to acquire the property to build a middle school.  The Partnership’s proposal was incorporated into the Redevelopment Authority’s recommendations to the City Council, which subsequently passed an ordinance approving the acquisition.  The condemnee challenged the taking alleging, among other things, that it was a violation of the Establishment Clause and was not for a public purpose.

In addressing whether the taking was a violation of the Establishment Clause, the Court applied the three-part test announced by the U.S. Supreme Court in Lemon v. Kurtzman, 403 U.S. 602 (1971).  In order to satisfy the Lemon test, it must be the case that the law: (1) has a secular purpose; (2) does not advance or inhibit religion; and (3) does not create “excessive entanglement” between church and state.  The Court concluded that the ordinance in this case failed all three parts.  It did not have a secular purpose because the purpose was to transfer the property to a religious organization that would operate a parochial school.  The acquisition advanced religion because it aided the Partnership’s goal of providing an education that was faith-based.  Lastly, the collaborative effort between the Authority and a religious organization created an excessive entanglement between church and state. 

While the Court ultimately based its decision on the violation of the Establishment Clause, it went on to note that the taking in this case was not for a public use under the U.S. Supreme Court’s decision in Kelo v. City of New London, 125 S. Ct. 2655 (2005).  Here the taking was the result of a plan to confer benefits on a private religious organization rather than on the public as a whole.  As such, it was not for a public use.

Municipality May Condemn Individual Blighted Property within Non-Blighted Areas

A property owner challenged the condemnation of his property located within an otherwise non-blighted area in City of Frederick v. Pickett, 2006 WL 1007652 (Md. 2006).  The plaintiff’s property, which was clearly blighted, was condemned in accordance with a city ordinance that authorized the use of eminent domain to take individual blighted property.  The property owner alleged that the city was without authority to do so because the state’s enabling legislation only allowed municipality’s to condemn property within blighted or slum areas.  See Md. Ann. Code 23A, § 2(b)(37) (2001).  The court examined the statute and noted that it included language describing the ability to condemn “single family or multiple family dwelling units” without any condition that the property be located within a blighted or slum area.  Therefore, the court concluded that the city had the authority to condemn individual blighted properties within non-blighted areas. 

Use of Land for Redevelopment Purposes Proper Despite Environmental Contamination

Plaintiff ExxonMobil Corporation challenged a city’s intention to redevelop a portion of its property for residential purposes in Housing & Redevelopment Authority of City of St. Paul v. ExxonMobil Oil Corp., 2006 WL 997699 (Minn. Ct. App. 2006).  ExxonMobil argued that the conversion of its environmentally contaminated lands to housing did not constitute a valid public use.  ExxonMobil stated that there was insufficient evidence that decontamination of the land would occur such that the land taken by the city would be used for the condemnation’s stated purpose.   The court, however, found that adequate evidence existed to show that decontamination of the land was likely to occur, and that decontaminated land would be used for residential development.  Therefore, the city’s redevelopment plan constituted a valid public use.     

Other Eminent Domain Cases

In Blue v. City of Los Angeles, 41 Cal. Rptr.3d 10 (Cal. Ct. App. 2006), which primarily dealt with procedural issues, a California appeals court upheld a finding of blight under state enabling legislation.  The court noted that, under California law, a single blighting condition, in conjunction with other factors was sufficient to authorize condemnation.    

In Ashbury Park Board of Education v. City of Ashbury Park, 2006 WL 870986 (N.J. Super. A.D. 2006), the court held that eminent domain may be used to take property that is already owned by another public entity where a greater public interest is served by the new public use. 

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