Eminent Domain Blog : Pennsylvania Eminent Domain Lawyer & Attorney : Fox Rothschild Law Firm : Condemnation, Real Estate Valuation : Philadelphia, Bucks County, Pennsylvania

The US Supreme Court has agreed to hear an appeal of a Federal Circuit’s decision in an eminent domain case. The case relates to an eminent domain doctrine known as a "de facto" or "inverse" condemnation which occurs when an act of a governmental entity is, in essence, a taking even if that entity has not formally initiated a condemnation action. The official question presented in that case is: "Whether government actions that impose recurring flood invasions must continue permanently to take property within the meaning of the Takings Clause."

In Arkansas Game & Fish Commission v. United States, the Arkansas Game & Fish Commission, sought just compensation from the United States for physically taking its bottomland hardwood timber through six consecutive years of protested flooding. The Court of Federal Claims awarded $5.7 million, finding that the Army Corps of Engineers' actions foreseeably destroyed and degraded more than 18 million board feet of timber, left habitat unable to regenerate, and preempted the Commission’s use and enjoyment. The Federal Circuit reversed that ruling and found that that the United States did not inflict a taking because its actions were not permanent and the flooding eventually stopped.

This will be a very interesting case to follow. Any time the Court decides an eminent domain case, it has the opportunity to opine regarding issues not necessarily presented by the specific case. I will continue to provide updates as the case progresses.

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Philadelphia Trial Court Judges Herron and Tereshko announced in a notice to the bar that they were not going to change a popular residential foreclosure diversion program. There was a proposal to end conciliation for foreclosures after a maximum of four conferences held within 150 days after foreclosure complaints were filed. The Judges stated that the reasons for maintaining the program as it has been conducted include the fact that the number of foreclourses is forecasted to increase and that capping the number of conciliation conferences would harm the program. Judge Herron also said that mortgage lenders, servicers and creditors are not always able to assemble the requisite documents in the time frame. Mayor Nutter also supported the continuation of the program.

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The US House of Representatives recently passed the "Private Property Rights Protection Act of 2012." The Act prohibits the federal government and states and municipalities from exercising its power of eminent domain over property to be used for economic development if the state or municipality receives federal economic development funds during any fiscal year in which the property is so used or intended to be used. "Economic development" is defined as the taking of private property, without the consent of the owner, and conveying or leasing that property from one private person or entity to another for commercial enterprise. Any state or municipality violating this Act would render it ineligible for any federal economic development funds for two years.

The bill is now pending in the Senate. Many states, including Pennsylvania, passed similar statues in the wake of the US Supreme Court Kelo case.

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In Shelp v. City of Scranton, a Pennsylvania trial court ruled that, in some cases, property sellers and brokers may be required to disclose the fact that a property was previously condemned to potential buyers. In that case, the defendant sold property to the plaintiff that had been previously condemned. The defendant had acquired the property from the City of Scranton after it was condemned by the City. The defendant did not disclose the prior condemnation to the plaintiff. The City later evicted the plaintiff at which point the plaintiff was informed that the property was condemned.

The plaintiff alleged that seller and real estate broker should have disclosed the prior condemnation. The facts are somewhat unclear, but it appears that the plaintiff was evicted by the City due to the unsafe condition of the property. The seller and the real estate broker filed a motion – known as preliminary objections – alleging that, as a matter of law, there was no duty to disclose the prior condemnation.

The Court denied the motion as to the seller and broker and ruled that the case could proceed. It found, for example, that the plaintiff relied upon the seller and broker’s representation that the property was fit for residential habitation and ultimately it was not fit. The defendants will now have the opportunity, as the case proceeds, to contest the factual arguments so this case is far from over.
 

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