The case of Fulton County Georgia and it’s Abuse of Eminent Domain – 2014 Georgia Supreme Court Decision

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Preface by Grant Austin:  Today’s blog is about a county’s attempt to abuse the eminent domain system. In summary, January 2012 the Fulton County Commission (Atlanta, GA area) adopted a resolution declaring that they needed about 12 acres for a library expansion project.  Skipping the details of the process for now, in March 2012 a special master found that the market value was $5,187,500.  The County did not pay the award and instead filed a voluntary dismissal of the condemnation action.  Too bad, sour grapes, the Supreme Court of Georgia said pay up!

Charles Pursley of the Atlanta based law firm of Pursley Friese Torgrimson represented charles pursleythe Condemnee in this matter and writes the following blog entitled “An Insider’s Look at the Georgia Supreme Court Decision in Dillard v. Fulton County.”

The complexities of eminent domain law can baffle inexperienced lawyers. Appraisal methods, procedural stipulations, and over two centuries of jurisprudence form an intricate network that dictates how and when private property can be taken. However, regardless of how convoluted the field is, there are concrete principles that remain certain. In Dillard Land Investments, LLC v. Fulton County, the Supreme Court spoke clearly and decisively about Fulton County’s attempt to abuse the system.

After a special master awarded $5,187,500.00 as compensation for the taking of Dillard’s land, Fulton County attempted unilaterally to dismiss its case without paying the just and adequate compensation owed the plaintiff. The trial court vacated and set aside the County’s attempt to dismiss its case and ruled that the County was required to pay the award because it failed to file an appeal for a jury trial to contest the amount. The Court of Appeals found much differently and reversed the decision. An ultimate appeal to the Georgia Supreme Court resulted in a ruling that, after entry of the award of the special master, Fulton County was no longer entitled to dismiss the condemnation proceeding.

The Court reasoned that an award of a special master has the same legal effect as an assessor’s award. When the award was entered, it became the judgment of a tribunal fixing the rights and liabilities of the parties, including Fulton County’s liability to pay the $5,187,500.000. Attorney Charles Pursley Jr., who represented Dillard Land Investments in the case, said the opinion “reinforces the principle that condemning authorities must operate within the constraints of the law”. The Court of Appeal’s decision would have deprived property owners of the right to be compensated for a government’s actions in taking private property. “Legally and ethically, eminent domain must be exercised with utmost good faith”, Pursley went on to explain “the Court of Appeals decision would have given condemning authorities the right to simply walk away and leave the condemnees without just and adequate compensation.” Condemnation cases “usually take years before they even get to a special masters hearing.   They begin with public information meetings – after which tenants may move out and it’s impossible to sell the land.  You generally can’t recover for pre-condemnation damages.  When you can’t sell, you can’t rent, and your property is losing value; damages accrued by the time the special masters award is decided are much more than attorney’s fees.   Allowing the condemning authority to require the property owner to go through a protracted process, possibly multiple times, and still allow the condemning authority unilaterally to withdraw would be an abuse of property owner’s rights”.

The Supreme Court opinion dissects how the Court of Appeals came to a position contrary to their own ruling by pointing out that the court misread the only case addressing the condemnation statute in question, and misinterpreted the intention behind the statute. The Court of Appeals decision would inequitably allow condemnors to pick and choose the appraisal value they prefer by rejecting an unfavorable award and using multiple special master’s hearings instead of filing an appeal and facing a jury trial. As Pursley points out, “if condemning authorities are confident in their appraisals, there should be no objection to following the statutorily prescribed appeals process to defend it in court.” The Supreme Court’s decision ensures that all condemnation procedures will continue to be used consistently and correctly.
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LINK TO THE SUPREME COURT OF GEORGIA DECISION at FindLaw.com

Charles N. Pursley, Jr. has litigated condemnation, eminent domain, business valuation and other real-estate cases for more than four decades. His practice includes a national client base of commercial, mixed-use and shopping center developers and owners with properties and businesses taken or damaged for a public project.

Because you hired a local appraiser for an important case!

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The real name of the research paper Is “Select the Out-of-Town Appraiser: New Social Science Research on Real Estate Expert Witness Selection” by your blog Editor, Grant W. Austin, M.S., MAI, CMRS, MRICS

Abstract:

This paper adds to the literature on the selection of the real property appraisal expert witness. The existing appraisal expert witness selection literature indicates that when the out-of-town expert witness overshadows the knowledge and experience of the local expert, the out-of-town expert is the clear choice yet most lawyers base their appraiser selection on factors that are irrelevant to winning the case such as convenience, proximity to their office, proximity to the subject property, a client’s recommendation or the expert’s cost. The results of this two-part social science research study indicate that in situations where there will be contentious valuation issues or, where the appraisal expert witness will be called upon to criticize the work of the opposing appraiser, it may be in the best interest of the client and outcome of the case to select an appraisal expert who is located outside of the appraisal services area of the opposing appraiser.

The direct link to this paper is Available at Social Science Research Network (SSRN): http://ssrn.com/abstract=2448010 or http://dx.doi.org/10.2139/ssrn.2448010

 

Fracking: Lessons Learned from the Gulf Oil Spill

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Heidi Robertson is a Professor of Law and Associate Dean for Academic Enrichment at the Cleveland-Marshall College of Law.  She has written a paper entitled “Applying HeidiRobertsonSome Lessons from the Gulf Oil Spill to Hydraulic Fracturing,” published in the summer 2013 edition of the Case Western Reserve Law Review.  The paper is also downloadable via SSRN and I include the link here: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2303883.

In this thoughtful and well-researched paper are words of advice for everyone involved in fracking.  Although Heidi’s paper focuses on Ohio’s regulation of hydraulic fracturing, her lessons are equally applicable to other States.  Topics in her paper include:

  • Conflicts of interest within the Minerals Management Service.
  • Need for greater research and planning to protect life, property and the environment – note the 2011 blowout during fracking in a well near Killdear, North Dakota that pierced the aquifer with drinking water that the town relies on.
  • Use of cleanup methods that have been tested and an emergency cleanup plan.
  • Necessity of a regionally unified spill response plan.

Again, Professor Robertson’s paper is downloadable via the Social Science Research Network at: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2303883.

Hydraulic Fracturing Contamination: Problems of Proof

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Keith B. Hall from the Louisiana State University Law Center has an upcoming paper in the Ohio State Law Journal entitled “Hydraulic Fracturing Contamination Claims: Problems of Proof.” Mr. Hall is an Assistant Professor of Law and Director of the KenHallLouisiana Mineral Law Institute.

 

 

 

Abstract: 
Hydraulic fracturing is controversial. Many people believe that hydraulic fracturing has caused contamination of groundwater and that the process should be prohibited because it is likely to cause additional contamination if it continues to be used. Many other people believe that hydraulic fracturing has not caused contamination and that little additional regulation is needed because fracturing is a useful process that poses little risk. Notably, this disagreement is not merely a difference of opinion regarding how society should balance economic development and environmental protection. Instead, the disagreement concerns facts – whether fracturing already has caused contamination and how much risk the process entails.

In part, the disagreement about facts arises from the difficulties in proving whether water is contaminated and, if so, what caused the contamination. It is important to consider ways to deal with these difficulties because determining whether hydraulic fracturing has caused contamination in specific circumstances can shed light on the general level of risk involved in using fracturing. It also can be important for purposes of resolving the numerous individual lawsuits in which plaintiffs allege that their groundwater has been contaminated by hydraulic fracturing.

This article contains four sections. The first two sections discuss what hydraulic fracturing is and the reasons why proving contamination claims is often difficult. The remaining sections discuss ways to deal with two “problems of proof.” Specifically, the third section examines new state regulations that require or encourage baseline testing of groundwater before oil or gas drilling takes place. The absence of pre-drilling data has often been a problem when evaluating contamination claims. The fourth section of this paper discusses Lone Pine orders, a procedure that courts can use in an effort to quickly resolve cases in which plaintiffs lack evidence to support an essential element of their claim.

If you would like to download Professor Hall’s entire paper it is available via the Social Science Research Network.  Go to:  http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2281457.

Eminent Domain Abusers Are Making a Comeback

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Cities and states are back to grabbing private property for the private profit of others.

In Atlantic City, a state agency recently decided to bulldoze the home that Charlie Birnbaum’s parents bought 45 years ago and that he now uses as a piano studio and a base for his piano-tuning business, as well as renting out two suites. New Jersey’s Casino Reinvestment Development Authority wants to replace it with an unspecified private development around the Revel casino, which emerged from bankruptcy a year ago.

Mr. Birnbaum is represented by my organization, the Institute for Justice, in trying to save his business and his parents’ former home. He was served with condemnation papers on March 14, and the first hearing will be on May 20. After a lull in cases of eminent-domain abuse over the past several years, we are increasingly hearing complaints from home and business owners about government attempts to take property for private development projects.

If Mr. Birnbaum’s story sounds familiar, that’s because it is a repeat of what the Casino Reinvestment Development Authority tried in 1996. In that case the New Jersey authority tried to take the home of an elderly widow, Vera Coking, as well as Sabatini’s Italian Restaurant and a jewelry store, for a proposed limousine parking lot for Donald Trump‘s Plaza Hotel and Casino.

The case garnered national attention and started a groundswell of interest in eminent-domain abuse. In 1998 a New Jersey district court denied the taking for the parking lot. Mrs. Coking stayed in her house for many years. Meanwhile, across the country home and business owners started resisting eminent domain. Courts began to take notice.

Then in 2005, the U.S. Supreme Court ruled by 5-to-4 in Kelo v. New London that a whole neighborhood in the Connecticut town could be condemned on mere economic speculation—on the hope that new homes and businesses would be built in the same location and that these would produce more property taxes and “economic development.”

The decision shocked the nation. In the years that followed, 44 states changed their laws to make eminent domain for private development more difficult. State courts also stepped into the gap—nine high courts, including New Jersey’s, placed state constitutional limits on eminent domain. Chastened by this wave of opposition, most cities and agencies became much more careful in their use of eminent domain.

Unfortunately, this breathing spell seems to be ending. This latest condemnation by the Casino Reinvestment Development Authority is part of a new wave of eminent-domain abuse, as cities and redevelopment agencies try to regain some of the power they lost:

• California actually abolished its redevelopment agencies in 2011. Now cities and powerful development interests have launched a ballot initiative to restore the redevelopment agencies and greatly expand their power to seize properties for private projects.

• In Colorado, Denver suburbs and other cities have been on a spree of condemnations for shopping malls.

• Minnesota, Alabama and Illinois have added powers to state and municipal agencies to condemn for such projects as sports stadiums, industrial developments and business-district economic development.

• Philadelphia is taking an artist’s studio for a private development.

• A Louisiana port agency is taking one private commercial port to be replaced by . . . another private commercial port.

• New York never stopped abusing eminent domain—taking property for Columbia University, the Brooklyn Nets and the ever-present “mixed-use development” across the state.

This renewed eagerness to seize private property for the private profit of others comes despite its poor track record.

• Nine years after the Kelo taking in New London, Conn., nothing but weeds occupies the area once populated by more than 70 homes and businesses.

• The 22-acre Atlantic Yards project in Brooklyn, N.Y., was supposed to include several office towers, thousands of housing units, retail, parks and other amenities to accompany the Barclays Center sports arena. But construction plans change, and the project will now include far less than originally promised.

• A thriving cigar and coffee lounge in San Diego was bulldozed in 2005, supposedly for a hotel. The space remains an empty parking lot nine years later.

The condemnation of Charlie Birnbaum’s building in Atlantic City is a classic example of eminent-domain abuse. The agency has no plan for the property. Promises of economic growth are made with no plausible substantiation of how it will happen. Mr. Birnbaum’s house is at the very edge of the area being taken and could easily be left alone. A judicial decision should come this year at the trial court, and the case is almost certain to be appealed.

The last outbreak of eminent-domain abuses spurred a grass-roots movement that seemed to chasten land-grabbing bureaucrats. With luck, these latest manifestations of government arrogance may prompt more pushback by home and business owners and result in greater private-property protections.

Ms. Berliner is the litigation director for the Institute for Justice, which represents Charlie Birnbaum, and represented the homeowners in both the Atlantic City eminent domain battle and the Kelo U.S. Supreme Court case.

This opinion piece originally appeared in The Wall Street Journal on Saturday/Sunday, May 17 – 18, 2014, A11.

 

Predictive Coding for eDiscovery: Introductory Reading List

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“Predictive coding is a document review technology that allows computers to predict particular document classifications (such as “responsive” or “privileged”) based on coding decisions made by human subject matter experts.  In the context of electronic discovery, this technology can find key documents faster and with fewer human reviewers, thereby saving hours, days, and potentially weeks of document review” (Kroll Ontrack, from Mastering Predictive Coding: The Ultimate Guide, 2014).

We have compiled a few key papers (with links) for your reading on predictive coding for ediscovery, as follows:

Predictive Coding: E-Discovery Game Changer?” by Melissa Whittingham et al.

Predictive coding: the beginning of a new e-discovery era” by Adam M. Acosta.

A New View of Review: Predictive Coding Vows to Cut E-Discovery Drudgery” by Joe Dysart.

Predictive Coding: Emerging Questions and Concerns” by Charles Yablon et al.

The Collision of the Courts and Predictive Coding: Defining Best Practices and Guidelines in Predictive Coding for Electronic Discovery” by Elle Byram.

Predictive Coding: The ESI Tool of the Future?” by Scott A. Petz et al.

Mastering Predictive Coding: The Ultimate Guide” by Kroll Ontrack eDiscovery.com

Taking of Large Easements for Energy and Telecommunications: Unfair to Property Owners and Solutions

This is a hot topic for lawyers and their clients facing an eminent domain taking of an easement for power lines, pipelines or communications lines.


PIPELINE

INTRODUCTION TO WORKING PAPER ENTITLED  “Involuntary Cotenants: Eminent Domain and Energy and Communications Infrastructure Growth” by its lead author, Professor Andrew P. Morriss*
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“Building modern utility (electric, gas, oil, communications) infrastructure is producing a vast increase in large infrastructure easements across private property. These easements often effectively make the utilities cotenants of the property with the landowner, yet exclude most of the mechanisms property law has traditionally used to cope with conflicts among cotenants. In this paper, the authors discuss the problems posed by eminent domain law in coping with these problems and suggest a range of solutions that could improve the process.”
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*Professor Morriss is the D. Paul Jones, Jr. & Charlene A. Jones Chairholder of Law & Professor of Business, University of Alabama.  The other authors of the paper, from the eminent domain law firm of Barron & Adler LLP in Austin, Texas, are Roy R. Brandys and Michael M. Barron.

This paper can be downloaded without charge from the Social Science Research Network Electronic Paper Collection: http://ssrn.com/abstract=2380159.

 

 

 

 

OPTIONS AND RIGHTS IN REAL PROPERTY….OH MY!! THE SCARY TRUTH ABOUT FUTURE INTERESTS

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In this paper by Alisa M. Levin, Esq. of Levin Law, Ltd. in Chicago she:

. . . .reviews the many different kinds of rights, options and terms that are commonly used in the U.S., and explores many popular issues that arise out of the use of options and rights, in addition to their impact on other legal concepts in Property Law. Part II provides an introduction into the overall context of the Article and provides insight into the problems attendant to the mixup between rights and options in general. Part III opens up the proverbial Pandora’s Box and identifies and explains the different kinds of rights and options that are used in U.S. real estate transactions commonly within Subpart A. Subpart B identifies concerns over priority in rights and options when two kinds of things are simultaneously announced or exercised by one or more parties or third parties involving real estate. Subpart C discusses the assignability of rights and options and explores the complications that arise when original parties to a real estate contract or lease assign or are the recipients of an assignment and lay a claim to a right or option. Part IV discusses issues in exercising rights and options and Subparts A through C discuss Landlord/Tenant (and vendor/vendee), Tender, Doctrines of Good Faith and Fair Dealing, Restraints and Perpetuities, and the issues of contiguous and unrelated parcels. Part V rounds out the discussion with thoughts and reflections on how the law might be shaped through modification of existing frameworks, crafting of a uniform statute governing rights and options, in consideration of the “boots on the ground confusion” that is being displayed in courtrooms across America. While not a comparison of every kind of right vs. option case that ever was, the sum of the parts is intended to provide a jumping off point for a dialogue in the halls of those drafting model and uniform rules, and to spurn more critical examination of the issues that truly affect the parties and their counsel when things are left in a confused state, such as whether we have an option, a right, or merely a question about what is what.

To read the entire paper go to: Levin, Alisa M., Options and Rights in Real Property…. Oh My!! The Scary Truth About Future Interests (February 26, 2014). Available at SSRN: http://ssrn.com/abstract=2402010 or http://dx.doi.org/10.2139/ssrn.2402010

Keywords: future interests, right to purchase, right to lease, right of first refusal, right of first negotiation, right of first offer, option to purchase, option to renew, exercise of option, exercise of right, breach of contract, breach of lease, good faith and fair dealing, rule against perpetuities.

3 Golden Rules of Negotiating

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Good lawyering and good experts aside, the outcome of the matter may really be decided by your negotiation skills.  There are many books on the topic, but here are 3 simple rules that can make a significant impact.
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by Grant Cardone

The art of negotiating escapes most of us, even good salespeople, because few take the time to correctly understand the word and follow the golden rules of negotiating.

The first and biggest error is a misunderstanding of the word. When I ask people at my Closers workshop what the word “negotiating” means, I get answers like, “how good a deal can I get” and “how cheap can I buy.” For many people, it’s a process of painful tactics of stall and overcome or a give and take mostly involving the surrender of price and terms.

“Negotiate” comes from the Latin negotiatus, which is the past participle of negotiari, and means to carry on business. This original meaning is critical to understand because the goal of negotiating is to continue doing business by conferring with another to arrive at an agreement.

So, scrap the notion that negotiating means lowering the price to reach an agreement. A lower price does not make for a better deal; it only makes for less margin for you and your company. Your goal is to come to an agreement about a proposal, and the way to do this is to build value in your offer. The solution your product or service offers is the focal point of negotiations, not the price.

Here are three of my 12 golden rules, which I won’t allow myself to violate in any negotiation, whether simple or complex:

1. Always Start the Negotiations. You must initiate the process because whoever controls the start of the negotiations tends to control where they end. If you let the other party start negotiations, you will be constantly giving up control, often without even realizing it. For instance, when you ask someone what his project budget is, you are allowing him to start the negotiations. You will then spend your time chasing his number rather than finding the best solution. When I sit down to work out an agreement on the numbers involved in the decision, I will even interrupt to prevent the other side from controlling the starting point. Sounds bizarre, but that is how important starting the transaction is. I once had a client who wanted to offer his terms upfront. I politely said, “Excuse me, I appreciate your willingness to tell me what you can do and would like just a moment to share with you what I have put together for you. If it doesn’t work, then please tell me.” This allowed me to control the starting point.

2. Always Negotiate in Writing. I see so many professional salespeople make the mistake of discussing and working on the terms of an agreement without ever committing their ideas to a written agreement. But the purpose of negotiations is to arrive at a formal written agreement, not tell a story or spend time talking. From the first moment I make a proposal, I refer to a document that is being created in front of the client. It includes all the points of agreement and becomes real to the prospective customer. Negotiating first and then having to create a document adds unnecessary time to a transaction. But if you build your written agreement as you negotiate, you are prepared to ask for a signature the moment the decision to buy is made.

3. Always Stay Cool. The negotiation table can be loaded with agendas, egos and emotions. Great negotiators know how to stay cool, providing leadership and solutions, while the rest of the room becomes insanely invested in personal agendas and useless emotions. Crying, getting angry, name calling and blowing off steam may make you feel good, but such behavior will not benefit you while negotiating. When the rest of the room gets emotional, stay cool like Spock and use logic to negotiate and close.
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Take a look at additional content by Grant Cordone:
Blog: http://www.grantcardone.com/blog/
You Tube:
https://www.youtube.com/GrantCardone

GrantCardoneGrant Cardone is an international sales expert, New York Times best-selling author, and radio show host of The Cardone Zone. He has shared his sales and business expertise as a motivational speaker and author of five books: Sell to Survive; The Closers Survival Guide; If You’re Not First, You’re Last; The 10X Rule; and Sell or Be Sold.