| Wall Street Journal 02/15/2001 State Court Sides With Property Owner In Another Eminent - Domain Contest By Dean Starkman |
A Pennsylvania appeals court blocked the condemnation of a steel-fabrication plant,
another victory for a property owner in an eminent - domain fight, on the rarely used
ground that a local government improperly delegated its public power to a private
developer.
The 5-2 decision, handed down Tuesday, is one of a growing list of rulings by state
and federal courts curbing local governments' eminent - domain powers, which allow
the taking of private property for public use if owners are compensated. Earlier this
month, a federal judge in Manhattan issued a temporary order blocking the village of
Port Chester, N.Y., from condemning commercial buildings under a state law that
allows a newspaper ad to serve as notice to owners that their property could be taken.
In the most recent case, the Montgomery County Redevelopment Authority, a public
entity, entered into agreements in 1986 and 1993 to condemn property in the Borough
of Conshohocken, Pa., belonging to closely held R&J Holding Co, the steel-fabrication
plant, and convey it to Greater Conshohocken Improvement Corp, a closely held
developer that has built office buildings and hotels in the area. The developer agreed
to pay the costs of the condemnation, a common provision in such redevelopment
agreements.
A trial court in 1998 overruled the steel plant's arguments that the development
agreement represented an improper delegation of government powers.
The steel plant took the case to the Commonwealth Court of Pennsylvania, the
intermediate appellate court, which on Tuesday reversed the lower court. The court
found that the agreements "purport" to block the government agency from
condemning the property without the developer's prior written consent, a provision that
allowed the developer to direct the condemnation. The court found the provision was
an improper delegation of power.
"Any agreement which purports to transfer such power to a private individual must be
deemed to be void and unenforceable, " the court wrote.
Richard Bazelon, a lawyer for the steel plant, said the ruling ends the condemnation. A
lawyer for the developer declined to comment, and a lawyer for the redevelopment
authority didn't return a phone call.
another victory for a property owner in an eminent - domain fight, on the rarely used
ground that a local government improperly delegated its public power to a private
developer.
The 5-2 decision, handed down Tuesday, is one of a growing list of rulings by state
and federal courts curbing local governments' eminent - domain powers, which allow
the taking of private property for public use if owners are compensated. Earlier this
month, a federal judge in Manhattan issued a temporary order blocking the village of
Port Chester, N.Y., from condemning commercial buildings under a state law that
allows a newspaper ad to serve as notice to owners that their property could be taken.
In the most recent case, the Montgomery County Redevelopment Authority, a public
entity, entered into agreements in 1986 and 1993 to condemn property in the Borough
of Conshohocken, Pa., belonging to closely held R&J Holding Co, the steel-fabrication
plant, and convey it to Greater Conshohocken Improvement Corp, a closely held
developer that has built office buildings and hotels in the area. The developer agreed
to pay the costs of the condemnation, a common provision in such redevelopment
agreements.
A trial court in 1998 overruled the steel plant's arguments that the development
agreement represented an improper delegation of government powers.
The steel plant took the case to the Commonwealth Court of Pennsylvania, the
intermediate appellate court, which on Tuesday reversed the lower court. The court
found that the agreements "purport" to block the government agency from
condemning the property without the developer's prior written consent, a provision that
allowed the developer to direct the condemnation. The court found the provision was
an improper delegation of power.
"Any agreement which purports to transfer such power to a private individual must be
deemed to be void and unenforceable, " the court wrote.
Richard Bazelon, a lawyer for the steel plant, said the ruling ends the condemnation. A
lawyer for the developer declined to comment, and a lawyer for the redevelopment
authority didn't return a phone call.
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