Latest 11 Cases This Week: United States Forest Service v. Cowpasture River Preservation Association (U.S.), Baker v. E.I. du Pont de Nemours & ...

Hard Cases

JOSEPH MARGULIES

Cornell law professor Joseph Margulies uses the killing of Rayshard Brooks in Atlanta by police to explain some lessons for reform we might learn. Margulies calls upon us to use this case to reexamine the circumstances that should result in a custodial arrest and to shrink the function of police so as to use them only in the very few situations that truly require them.

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United States Forest Service v. Cowpasture River Preservation Association

Court: US Supreme Court

Docket: 18-1584

Opinion Date: June 15, 2020

Judge: Clarence Thomas

Areas of Law: Energy, Oil & Gas Law, Government & Administrative Law, Real Estate & Property Law

Atlantic sought to construct a 604-mile natural gas pipeline from West Virginia to North Carolina, crossing 16 miles of land within the George Washington National Forest. Atlantic secured a special use permit from the U.S. Forest Service, obtaining a right-of-way for a 0.1-mile segment of pipe 600 feet below a portion of the Appalachian National Scenic Trail, which also crosses the National Forest. The Fourth Circuit vacated the permit. The Supreme Court reversed. The Department of the Interior’s assignment of responsibility for the Appalachian Trail to the National Park Service did not transform the Trail land into land within the National Park System that is not eligible for a pipeline lease. The Forest Service had the authority to issue the special use permit. Under 16 U.S.C. 521, the Forest Service has jurisdiction over the National Forest. The National Trails System Act, 16 U.S.C. 244(a), applies to the Appalachian Trail; the Secretary of the Interior has delegated to the National Park System the authority to enter into “rights-of-way” agreements for the Trail. The Leasing Act enables any “appropriate agency head” to grant “[r]ights-of-way through any Federal lands . . . for pipeline purposes,” 30 U.S.C. 185(a), except lands in the National Park System. The National Park System is administered by the Secretary of the Interior, through the National Park Service, 54 U.S.C. 100501. The Forest Service “right-of-way” agreements with the National Park Service for the Appalachian Trail did not convert National Forest “Federal lands” under the Leasing Act into “lands” within the “National Park System.” A right-of-way grant only nonpossessory rights of use. Although the federal government owns all lands involved, a right-of-way between two agencies grants only an easement, not jurisdiction over the land itself.

Baker v. E.I. du Pont de Nemours & Co.

Court: US Court of Appeals for the Seventh Circuit

Dockets: 19-3160, 19-3159

Opinion Date: June 18, 2020

Judge: Joel Martin Flaum

Areas of Law: Aerospace/Defense, Civil Procedure, Environmental Law, Real Estate & Property Law, Zoning, Planning & Land Use

From 1906 -1970, the companies manufactured industrial materials at an East Chicago, Indiana Superfund Site. In the 1970s, the East Chicago Housing Authority constructed “West Calumet,” a low-income residential building, on that site. In 2017, former West Calumet tenants sued the companies based on the tenants’ exposure to hazardous substances. Defendant Atlantic Richfield removed the case to federal court, asserting a government contractor defense because its predecessor, ISR, operated during World War II. ISR sold lead and zinc to entities who were under contract with the government to produce the goods for the military. ISR itself held five Army contracts. The materials made by ISR were critical wartime commodities that had to be manufactured according to detailed federal specifications. Other regulations effectively prevented ISR from selling to distributors for civilian applications. Defendant DuPont asserted that the government directed it to build a facility for the government and then lease it from the government to produce Freon-12 and hydrochloric acid solely for the government. The district court remanded, finding that most of the Companies’ government business occurred outside the relevant time frame. The Seventh Circuit reversed. Atlantic Richfield worked "hand-in-hand with the federal government to achieve a task that furthers an end of the federal government.” The Companies’ wartime production was a small but significant portion of their relevant conduct; the federal interest in the matter supports removal. Atlantic Richfield set forth sufficient facts regarding its government contractor defense.

Murray v. BEJ Minerals, LLC

Court: US Court of Appeals for the Ninth Circuit

Docket: 16-35506

Opinion Date: June 17, 2020

Judge: Sidney Runyan Thomas

Areas of Law: Real Estate & Property Law

The en banc court affirmed the district court's order granting summary judgment to plaintiffs and declaring them owners of dinosaur fossils discovered on their ranch. The Montana Supreme Court accepted the en banc court's certification request and answered the certified question, concluding that dinosaur fossils were not within the "ordinary and natural meaning" of "mineral" and, thus, belonged to the surface estate. In this case, because plaintiffs are the undisputed owners of the surface estate, the state court's decision requires a resolution in their favor.

AIDS Healthcare Foundation v. City of Los Angeles

Court: California Courts of Appeal

Docket: B303308(Second Appellate District)

Opinion Date: June 15, 2020

Judge: Egerton

Areas of Law: Civil Rights, Constitutional Law, Real Estate & Property Law

After filing unsuccessful petitions for writ of mandate challenging the approval of two of the projects under various land use laws, AFH filed suit against the City for violating the federal Fair Housing Act (FHA) and the state Fair Employment and Housing Act (FEHA) based on a disparate-impact theory of liability. The Court of Appeal held that the trial court correctly found AHF cannot assert a cause of action under the FHA and FEHA based on its alleged disparate-impact theory of liability where AHF has not alleged a policy that is an artificial, arbitrary, and unnecessary barrier to fair housing. In this case, AHF has not alleged that the City's policy restricts affordable housing; the City's approval of the Projects does not eliminate housing; and AHF seeks to impose a new development policy on the City, rather than to eliminate one. The court also held that the trial court did not abuse its discretion by denying AHF leave to amend. Accordingly, the court affirmed the trial court's decision sustaining the City's and Real Parties' demurrers.

Malabe v. Ass'n of Apartment Owners of Executive Centre

Court: Supreme Court of Hawaii

Docket: SCWC-17-0000145

Opinion Date: June 17, 2020

Judge: Sabrina S. McKenna

Areas of Law: Antitrust & Trade Regulation, Real Estate & Property Law

In this certiorari proceeding arising out of a lawsuit brought by condominium owners whose unit was nonjudicially foreclosed by their association of apartment owners the Supreme Court held that the intermediate court of appeals (ICA) erred in affirming the circuit court's dismissal of the unfair or deceptive acts of practices (UDAP) claim, holding that the Plaintiffs' UDAP claim should not have been dismissed. Plaintiffs filed a complaint against their association (Association), by and through its board of directors (Board), asserting wrongful foreclosure and UDAP claims based on the Board's nonjudicial foreclosure and public sale of their condominium apartment due to unpaid assessment fees. The circuit court dismissed the complaint for failure to state a claim. The ICA held that the circuit court (1) erred in dismissing Plaintiffs' wrongful foreclosure claim, and (2) correctly dismissed the UDAP claim as time-barred. The Supreme Court reversed as to the UDAP claim and otherwise affirmed, holding (1) the ICA correctly reinstated the wrongful foreclosure claim because the Board lacked a power of sale; and (2) based on the applicable notice pleading standard, viewing the complaint in the light most favorable to Plaintiffs, it cannot be said that Plaintiffs can prove no set of facts in support of their claim that would entitle them to relief.

In re Estate of Franken

Court: Iowa Supreme Court

Docket: 18-0261

Opinion Date: June 12, 2020

Judge: McDonald

Areas of Law: Contracts, Real Estate & Property Law, Trusts & Estates

The Supreme Court reversed the judgment of the district court ruling that Plaintiffs' claim seeking contract damages was barred by the limitations period set forth in Iowa Code 614.17A, holding that the district court erred in granting summary judgment. John and Dessie Rottinghaus filed a claim in the Estate of Sandra Franken, alleging that the Estate sold certain real estate in violation of their right of first refusal to purchase the real estate. The executor disallowed the claim and moved for summary judgment, claiming that section 614.17A barred the Rottinghauses' claim. The district court granted the motion for summary judgment, concluding that the statute of limitations precluded the Rottinghauses' claim for damages. The Supreme Court reversed, holding (1) section 614.17A applies only to actions seeking to recover or establish an interest in or claim to real estate filed against the holder of the record title; and (2) neither the merger doctrine, the statute of frauds, the indirect effect of section 614.17A, nor the statute of limitations in section 614.1(5) barred the Rottinghauses' damages action.

Bank of New York Mellon v. King

Court: Massachusetts Supreme Judicial Court

Docket: SJC-12859

Opinion Date: June 17, 2020

Judge: Kafker

Areas of Law: Banking, Real Estate & Property Law

The Supreme Judicial Court affirmed the decision of the Housing Court ordering Defendant to pay $4,000 in use and occupancy to the Bank during the course of his appeal from a judgment in favor of the Bank in a summary process action, holding that the postforeclosure defendant whose appeal bond is waived may be ordered to pay use and occupancy to the plaintiff. After foreclosing on Defendant's property, the Bank obtained judgment in a summary process action against Defendant. Defendant appealed and moved to waive the appeal bond. The judge waived the bond but ordered Defendant to pay monthly use and occupancy to the Bank while the appeal was pending. The Appeals Court vacated the portion of the order requiring use and occupancy payments. The Supreme Judicial Court held (1) the bond for a defendant appealing from an adverse judgment in a postforeclosure summary process action may be waived if he is indigent and pursuing nonfrivolous arguments on appeal; (2) the postforeclosure defendant whose bond is waived may be ordered to pay use and occupancy to the plaintiff; and (3) the amount Defendant was ordered to pay as use and occupancy in this case reflected a fair balancing of interests.

In re Trenton Farms RE, LLC Permit No. MOGS10520

Court: Supreme Court of Missouri

Docket: SC97695

Opinion Date: June 16, 2020

Judge: Patricia Breckenridge

Areas of Law: Agriculture Law, Animal / Dog Law, Government & Administrative Law, Real Estate & Property Law

The Supreme Court affirmed the decision of the clean water commission approving Trenton Farms' permit to establish a twin concentrated animal feeding operation (CAFO), holding that House Bill No. 1713 (HB 1713) does not violate the original purpose, single subject, or clear title requirements of the Missouri Constitution and that there was sufficient evidence regarding the CAFO's protection from a 100-year flood. The clean water commission affirmed the department of natural resource's issuance of a permit to Trenton Farms to establish a CAFO. Hickory Neighbors United, Inc. appealed, arguing (1) HB 1713, which amended Mo. Rev. Stat. 644.021.1 to change the criteria for members of the commission, violated Missouri Constitution article III's original purpose requirement and single subject and clear title requirements; and (2) there was insufficient evidence that CAFO's manure containment structures would be protected from inundation or damages in the event of a 100-year flood, a requirement of 10 C.S.R. 20-8.300. The Supreme Court affirmed, holding (1) HB 1713 is constitutionally valid; and (2) there was sufficient evidence that CAFO structures met regulatory requirements.

Stalowy v. Flathead Conservation District

Court: Montana Supreme Court

Citation: 2020 MT 155

Opinion Date: June 16, 2020

Judge: Beth Baker

Areas of Law: Government & Administrative Law, Real Estate & Property Law

The Supreme Court affirmed the judgment of the district court upholding the declaratory ruling of the Flathead Conservation District asserting jurisdiction over David and Jacqueline Stalowy's dredging project, holding that the district court did not err. The Stalowys applied for permits with the District to conduct dredging activities on their Flathead County property. For the District to have jurisdiction under the Natural Streambed and Land Preservation Act of 1975 (Act), Title 75, chapter 7, Mont. Code Ann., the proposed dredging work must result in a "change in the state" of a "natural, perennial-flowing stream." At issue was whether North Bear Creek and other waterbodies on the Stalowys' property met the definition of a “stream." The District issued a declaratory ruling asserting jurisdiction over the Stalowys' property and projects. The district court affirmed. The Supreme Court affirmed, holding that the District had jurisdiction over the project.

Utah Department of Transportation v. Boggess-Draper Co.

Court: Utah Supreme Court

Citation: 2020 UT 35

Opinion Date: June 11, 2020

Judge: Thomas R. Lee

Areas of Law: Constitutional Law, Real Estate & Property Law

In this eminent domain action, the Supreme Court reversed the judgment of the district court endorsing a "general rule that a party may not rely on post-valuation facts and circumstances to prove severance damages," holding that there is no categorical rule foreclosing the relevance of evidence of a subsequent transaction involving the property in question. In 2009, a portion of Plaintiff's property was taken by the Utah Department of Transportation (UDOT). During the subsequent litigation, the parties disputed the amount of damages for the condemned property and on the amount of severance damages as to Plaintiff's remaining property. Plaintiff eventually sold the remaining property, which was developed into two car dealerships. On a pretrial motion in limine the district court excluded this development, concluding that that the property had to be valued as of the date of the taking and based on what a willing buyer and seller would have known at that time. The Supreme Court reversed, holding that there is no categorical rule deeming post-valuation-date evidence irrelevant to the determination of fair market value under Utah Code 78B-6-511 and -512.

731 Market Street Owner, LLC v. City and County of San Francisco

Court: California Courts of Appeal

Docket: A154369(First Appellate District)

Opinion Date: June 18, 2020

Judge: Frank Y. Jackson

Areas of Law: Real Estate & Property Law, Tax Law

In 2009, 731 Market leased the ground floor of its commercial building to CVS for a term of 45 years. Once the lease was recorded with the City and County of San Francisco, a “Real Property Transfer Tax” was paid under the San Francisco Business and Tax Regulations Code, based on the value of the stream of rental payments due over the lease’s life. In 2015, 731 Market sold the building, which included the CVS lease. All terms of the original lease remained unchanged with a remaining term of more than 35 years. 731 Market paid a documentary transfer tax, then unsuccessfully sought a refund of the amount of tax it paid based on the value of the remaining stream of payments due over CVS’s lease. The trial court and court of appeal agreed with 731 Market that the 2015 transaction did not trigger the tax as to the leasehold interest because the transaction did not result in any “realty sold” under the ordinance. San Francisco impermissibly collected a “double tax” on the property.