Author: Alan Ackerman

Legal Battles Loom over Land for New Bridge

As the State of Michigan has started making offers on non-residential properties it needs to begin construction on the Gordie Howe International Bridge, multiple legal battles could be looming for the state. One such property, The First Latin American Baptist Church, located at 6205 W. Fort St., rejected an offer in late July from the Michigan Department of Transportation (MDOT) because the offer was too low, according to an article by Louis Aguilar of The Detroit News.

Alan Ackerman, a partner at Ackerman Ackerman & Dynkowski, representing the church, told Aguilar, “Their methodology may have been suspect. We are getting our own appraisal done.”

This is not the only battle the state may be facing. Manuel (Matty) Maroun, owner of the Ambassador Bridge, is a strong opponent of the new bridge, and owns about 30 parcels of land needed by the state to begin construction on the bridge. If Moroun refuses the state’s offers, a court fight could last years. As Ackerman explained in an article by John Gallagher of the Detroit Free Press, these eminent domain cases could take anywhere from eight months to as long as five years.

With the state needing to acquire about 670 parcels to start construction on the bridge, about half of which has been purchased, MDOT officials estimate that the bridge will be built in time – a prediction that is too optimistic, Ackerman believes.

Ackerman believes the bridge will not be finished until 2023, and not until all parties reach an agreement with Moroun, he told Jack Lessenberry in an editorial for the Detroit Metro Times.

“I’ve never seen anything like the power of Matty Moroun,” Ackerman said. “He gets anything he wants.”

It remains to be seen just how long this process will take, but with many businesses still awaiting long-overdue offers from the state, MDOT’s hopes for a bridge built by 2020 are appearing more and more like a pipe dream.

Walking Into a Storm

The Peters Township School Board and the local community determined it would be best to acquire a former country club site which has been recently sold. Apparently, the intent, at least in part, is to avoid further development of the community.

It is just this development which creates value in the property. Without question, the purchaser has spent substantial time in determining the property could be bought for 8.7 million dollars and profitably developed. The School Board probably assumes it will simply write a check for 8.7 million dollars and say goodbye to all. If so, the District Board and the Community are dreaming, in what will likely result as a very bad dream.

“The township has been looking at the site as a possible location for recreation facilities such as a pool. The school district has said the property would be used for school facilities.

Peters Council is scheduled to vote on Monday.

The resolution states that by eminent domain code, the school district is “authorized and empowered” to acquire by condemnation any lands or buildings for proper school purposes.

The school board and council made a joint offer on the property located along East McMurray Road in June, but it was rejected.

In late June, the property was sold to Pinehurst Partners, LLC at a price of $8.7 million, according to the recorder of deeds.”

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Why Kitchen Table Meetings Do Not Work

The Indiana Department of Transportation is by its nature a public agency intending to serve the public. But the Department does not always “help” individuals who are about to be acquired. The notion that INDOT will contact individual owners for “kitchen-table meetings” with a third party appraiser implies that somehow the whole situation is collegial program. Realistically, the Department of Transportation agents would love to sit down with the owners and know all the owner’s positives and negatives. However, the owner comments may be taken out of context and utilized at some future trial. Nothing could be more detrimental to the owner. Below is a page of warnings to property owners, written by this firm years ago, but still instructive.

“The state estimates that in a worst-case scenario it could acquire as many as 279 homes and 96 businesses. But the exact route won’t be determined until 2018, and the amount of land acquired could be less.

Under the powers of eminent domain, the state can take private property for public use. In the first five sections of the highway project, the state paid $184 million for 348 properties.

When the properties the state needs are identified, INDOT will contact owners for in-person “kitchen table meetings,” and a representative will be assigned. A third-party appraiser will value the property, which will be reviewed by a second appraiser. To request a change in the appraisal, the owner must submit documentation to back it up.”

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The Invitation To Cheat

When governments have “secret” checkbooks, and public officials can pay for personal contract services without contemporaneous public review, public officials seem to consistently get themselves into corruption investigations, subjecting themselves to criminal liability.

The situation described in Allentown involves a number of substantial and well respected law firms. All are tarnished by the process in which they received 3.8 million dollars in attorney fees. Noteworthy is that a substantial proportion of the unchecked billings occurred out of eminent domain proceedings.

This is not unlike what had occurred in Bridgeport, Connecticut only ten years ago. There, the attorney received “bonuses” in the form of broker’s fees when he bought properties for the City, with the broker’s fee increasing as owners received greater amounts of alleged compensation.

The invitation is one which is too attractive to too many. Too frequently, professional services are rendered to those who are most active in the process rather than those who have a concern about being fair and paying what is Just Compensation to owners, which should be the most important consideration.

“For more than three years, the FBI has been investigating an alleged pay-to-play scheme in Allentown to determine if public officials traded contracts and other favorable treatment for campaign contributions, food and drinks. Three city officials and three others have pleaded guilty in the investigation, which was revealed last summer with the raid of Allentown City Hall.

FBI agents served the city the subpoena asking for thousands of documents related to more than two dozen people and businesses that worked or attempted to work with Allentown. Their examination covered the previous decade’s worth of records. In a series of stories, The Morning Call has analyzed bills, invoices and agreements from numerous contractors on the list.”

“Stevens & Lee topped the list with $1.79 million received over the 10-year span. Norris McLaughlin earned $1.73 million from work performed directly for the city and for the Allentown Neighborhood Improvement Zone Development Authority as it built the PPL Center arena. Duane Morris was paid $319,000.”

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Pipeline Challenge Goes down a Beaten (and Unsuccessful) Path

Owners in Medina, Ohio are attempting to stop Nexus surveys of the proposed properties to be taken.

The decision to acquire is one which only is made after the surveys are made and the determination of the best route is completed. One of the problems is that the determination of best route may not necessarily be what is most environmentally sensitive or least expensive, but rather what the utility, in its sole discretion, determines as the “best route”.

The challenge being made by the owners is similar to what was made and rejected in California only last week. See Alan Ackerman, Important Right of Entry Statute Found Constitutional, National Eminent Domain, July 2016.

“MEDINA, Ohio — Lawyers for a proposed natural gas pipeline argued in court that surveyors should be allowed on the land of more than 32 Medina county property owners to survey endangered bats, wetlands and cultural or historical sites along the pipeline’s 255-mile path.

Residents oppose any intrusion by Nexus Gas Transmission on their land.

Medina County Common Pleas Court Judge Christopher Collier heard part of Nexus’ request for a court order to allow the surveys Wednesday morning. The hearing will continue Thursday.

In October, Collier ruled that Nexus workers should be permitted onto the property of homeowners to perform surveys for the pipeline. That ruling has been appealed to the U.S. Ninth District Court of Appeals, which has not yet issued a ruling.

“These people have received letters saying they must sign papers to allow the (land) survey by Nexus or they (Nexus) will simply enter the property on certain dates,” said Greg Huber, lawyer for the landowners. “Private property owners have the right to tell someone they cannot enter their property. Nexus representatives come to their doors, and while one man talks, the other man stands there carrying a sidearm.”

Nexus spokesman Adam Parker responded by email, “Occasionally, Nexus employs off-duty police officers at its own expense to accompany its survey crews in order to ensure their safety and security.”

Residents in court Wednesday said that the request to allow people on their land to look for bats, wetlands and historical sites was a way of getting around homeowners’ refusal to let them survey their property for the gas line.

“I think that they are using the bat issue as a backdoor way of getting onto our land so they can survey it for the pipeline,” said Jacqueline Pradu-Fecca, of Medina.”

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Important Right of Entry Statute Found Constitutional

Almost every state has a “Right of Entry” statute. The provision that allows an agency considering the acquisition of property, the right to enter property to survey and test the property prior to the filing of a condemnation case. This entry is not to be one that damages a property, or any damages would then be paid for.

This Right of Entry provision has been held constitutional in California despite the notion that anything touched or taken should be paid for generally on a good faith offer prior to acquisition. Quite simply, the surveying process, one which is available in almost every jurisdiction, is one necessary for authorities to not be at risk of paying too much for property.

The California Supreme Court opinion Property Reserve v. Superior Court, (2016 WL 3924221) has been awaited for months because of its implication in the statutory process of many other jurisdictions.

“In a defeat for Delta landowners, the state Supreme Court on Thursday ruled that government officials need not go through a formal eminent domain process before they can survey private property for the $15 billion twin tunnels.
The decision reverses a lower court’s ruling and removes one potential hurdle for the massive water diversion project after a six-year, back-and-forth legal struggle between Delta farmers and the state Department of Water Resources.
Delta farmers, who fiercely oppose the tunnels, objected to the state’s efforts to access their land. The proposed surveys included activities such as searching for animals, taking photographs and drilling softball-sized holes more than 200 feet deep to examine the soil.”

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