Wednesday, August 14, 2013

An Apprendi for EmDom

City of Perris v. Stamper, No. E053395 (D4d2 Aug. 9, 2013)

The court of appeal holds that a condemnee in an eminent domain action has a right to a jury trial on all predicate issues of fact that relating to the calculation of just compensation.

Unfortunately, this one takes some setup. 

Under both state and federal constitutional law, when a government body takes private property it must pay the owner current market value. A difficult valuation issue arises when the government wants to take only a portion of a property that is zoned for a particular use, but is currently undeveloped. Under these circumstances, the government often argues that it would have required the dedication of the taken property as a condition of any future development permit. The taken part of the property thus could never be developed to the zoned use and should be appraised only at the undeveloped value. (This is all called the Fresno/Porterville doctrine, and if the whole thing sounds kind of speculative, I'm with you.)

The courts have developed a three-part test for this determination. First, the government must show that there is a reasonable probability that it would actually require the dedication of the take as a condition of development. Second, if dedication condition is likely to be required, government must establish that the condition satisfies the "rough proportionality" requirement of the Supreme Court's Fifth Amendment Nolan/Dolan takings doctrine. That is, that the conditions imposed on development must be related in both nature and extent to the expected impact of the proposed development. If imposing the dedication condition would be unconstitutional, it makes sense that the government cannot argue that it could successfully impose it as a condition to develop the property. And third, having decided whether or not the dedication would likely have been and could constitutionally be imposed, what is the take worth based on the resulting zoning treatment?

In this case, the City of Perris wants to take, through eminent domain, a strip of Stamper's property for a road realignment. The property is zoned light industrial but is currently an open field. Perris takes the position that it would require the roadway dedication as a condition of any future development permit. Thus, the take should be valued as agricultural, not industrial land, because it will never be developed as currently zoned.

Now that we have gotten well in to the weeds on EmDom law, the salient procedural point is that the state constitution requires that "just compensation" for a taking to be "ascertained by a jury unless waived." The procedural issue presented, then, is to which of the three phases should the jury trial right attach. Perris argued, and the trial court agreed, that both steps one and two were legal issues for the court. The court held a bench trial on these questions, finding favorably to Perris on both points. Obviating the need for a further trial, Stamper stipulated to Perris's appraisal and appealed.

Stamper argued that, under Metropolitan Water Dist. of Southern California v. Campus Crusade for Christ, Inc., 41 Cal. 4th 954 (2007), he was entitled to a jury trial on any fact that bore of the valuation of the property, including the likelihood that the city would require dedication of the take as a development condition, as well as the factual determinations that go into the Nolan/Dolan proportionality test. The court of appeal agreed. Thus, on remand, unless the evidence is such that either party is entitled to judgment as a matter of law on an issue, the trial court should submit to the jury and instruct it on how to decide: (1) the likelihood of the imposition of the dedication condition; (2) whether the condition imposed would be roughly proportional to the traffic, environmental, etc., impacts created by the development of the property; (3) the ultimate valuation of the take based on the resolution of those fact issues.

Reversed and remanded.

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