Review of the year of jurisprudence in the eminent fields 2021 | Nossaman LLP

Throughout the ups and downs of 2021, there have been multiple developments on the prominent fields front, including the special occasion when the United States Supreme Court heard a levies case. Aside from case law, 2021 saw the passage of the Infrastructure Investments and Jobs Act, which aims to provide federal funding for infrastructure projects for many years to come. All in all, 2021 has been a fairly busy year for practitioners in the grip and in prominent fields.

For your convenience, we have compiled summaries of important cases and developments in a prominent area from 2021.


Bill on infrastructure

On November 15, 2021, President Biden enacted the Infrastructure Investment and Jobs Act (PL 117-58). The bipartisan infrastructure bill provides for $ 1.2 trillion in federal spending over the next five years. Funding will be allocated to roads, bridges, major infrastructure projects, mass transit, railways, broadband upgrades, airports, ports, waterways, electric vehicles, improvement of water and water supply systems and environmental sanitation. Part of the funds are allocated to provide existing programs with higher levels of funding in the short term, while other parts of the funds will be allocated to create entirely new programs.


California case

Felkay v. City of Santa Barbara, 2021 Cal.App. LEXIS 225 (March 18, 2021) – Regulatory Decision Making

In Felkay, a landlord requested to build a house on a property that had (i) physical characteristics that precluded construction on part of the property and (ii) Coastal Plan policies that prohibited development on the remaining part. The request to build on the physically compatible portion of the land was rejected by the City of Santa Barbara at both the planning commission and city council level – despite staff recommendations for a policy waiver – because it violated coastal policy. This rejection eliminated all development options on the property. The owner did not attempt to submit multiple requests, as the City had “made it clear” that it would not allow any development in this physically compatible part of the property. After the initial denial, the owner filed a reverse conviction action. The trial court concluded that there had been a reverse conviction.

On appeal, the City argued that the landlord should have submitted a revised claim, thereby rendering the reverse conviction claim immature. The court concluded that the reverse claim was ripe on the basis of the “futility exception”. Under the futility exception, multiple applications are not necessary where the first rejected application clearly indicates that no project, regardless of the submission, will be approved. The court concluded that the City would not allow any development on the part of the property covered by the coastal policy, so the frivolity exception was valid.

City of Escondido c. Pacific Harmony Grove Dev., 2021 Cal. App. LEXIS 706 (August 26, 2021) – Dedication of the property

In Pacific harmony grove, the City of Escondido has filed a state action to acquire a strip of land for a road extension. The road extension had long been on the city’s circulation element of its general plan, and a city ordinance required any owner developing a property to make public improvements to conform to the general plan. In the action for condemnation, the City argued that the strip of land had a face value ($ 50,000) since it should have been dedicated as part of any future development. The owner claimed that the road was not necessary, as it could use an existing road that had sufficient capacity, and therefore the strip of land should be evaluated based on its highest and best industrial use, resulting in a compensation of nearly $ 1 million. The trial court concluded that the strip of land should be assessed at its unimproved value since it should have been consecrated as part of any future development, and such a dedication requirement was constitutional (it was roughly proportional and rationally linked to any future development impacts). The court also concluded that the “project effect rule” did not apply since the assignment was not put in place to impact the value of the property, but rather to mitigate the costs of traffic created by future development. The owners appealed.

On appeal, the tribunal was asked to determine which valuation method should apply – the commitment doctrine or the project influence rule. The court ruled that (i) the dedication requirement was constitutional, since the City did the work to demonstrate that the dedication requirement was proportional to the impacts, and (ii) the project influence rule did not apply. did not apply because the dedication requirement arose as part of the overall plan and circulation element, which were in place long before the likely inclusion date.

Foley Investments, LP v. Alisal Water Company dba Alco Water Service, 2021 Cal.App. LEXIS 1026 (Nov 16, 2021) – Reverse conviction

In Foley Investments, a water pipe under an apartment complex burst and caused damage to the complex, and the owner sued the water supplier for reverse conviction and tort claims. The water supplier did not assert any liability because the connection to the pipeline was not a public improvement and it was immune from tort claims under article 774 of the Service Code. public. log onto the property lines and enter the property. The court of first instance found no responsibility.

On appeal, the court was asked to determine whether the water utility was operating its facilities for “public use” and therefore potentially liable for reverse conviction damages. The court upheld the finding that there was no reverse conviction. First, the water pipe was installed under a private contract and not through a prominent domain. Second, this water pipe was intended to meet an individual need (meeting the flow requirements of fire hydrants that only served this property) and it did not serve the general public. Additionally, while around 400 people lived on the property, it only consisted of 81 units and there was in fact only one water customer, the owner. Finally, in the case of an installation under a private contract, the risk-sharing policy considerations underlying the reverse order were inapplicable. Therefore, the court concluded that the water pipe was for private use and the reverse conviction liability was inapplicable.


Federal affairs

Cedar Point Nursery v. Hassid, 2021 US LEXIS 3394 – Regulatory decision

In Cedar Point Nursery, a California regulation gave labor organizations the right of access, for a certain number of hours and days, to farm property in order to solicit support for unionization. The owners sought to enforce this activity in the form of an easement taken without compensation.

Court asked to determine whether a California regulation granting labor organizations a right to access a farm employer’s property for the purpose of soliciting support for unionization was unconstitutional in itself physical grasp – in particular, if an uncompensated appropriation of an easement that is limited in time affects a in itself physical outlet. The United States Supreme Court has ruled that California’s access to union organizing regulations are a in itself physical outlet. The question of duration relates only to the amount of compensation, and not to the existence or not of an invasion.

PennEast Pipeline Co., LLC v. New Jersey, 2021 US LEXIS 3564 (2021 WL 2653262) – Prominent Domain Power

In PennEast Pipeline, a pipeline company applied to the Federal Energy Regulatory Commission (FERC) for a utility certificate to build a pipeline. The company intended to use the eminent domain power granted by FERC to acquire the right of way. Part of the necessary land belonged in part to the State of New Jersey.

The tribunal was asked to determine whether the federal government could constitutionally give pipeline companies the power to condemn necessary rights of way in which a state has an interest. The United States Supreme Court has ruled that a private pipeline with eminent domain power under the Natural Gas Act can doom property owned by the state of New Jersey. While non-consenting states are generally immune from prosecution, states waived this immunity from the exercise of eminent federal power when they ratified the Constitution.

Outfront Media v. City of San Diego, 2021 US Dist. LEXIS 103728 – Reverse Sentencing

In In the front Media, a billboard owner had been leasing a property to display a billboard for many years when it was converted to a month-to-month lease in 2005. In 2010, a redevelopment agency offered to acquire the set of the property for a future project and made offers for purchase to the owner and owner of the billboard. The offers indicated that formal approval of the conviction had yet to be obtained. The owner sold, but the owner of the sign turned down the offer. Following the abolition of the redevelopment agencies, the City of San Diego became the owner of the property, and in 2019, the city terminated the billboard lease. The owner of the billboard filed a reverse conviction complaint in federal court and argued that the termination of the lease was tied to the underlying purchase of the property in 2010 and that the prominent estate was in jeopardy. The City argued that the lease ended naturally, that the eminent domain was never threatened, and that the City never expressed an intention to exercise the eminent domain.

The district court had to determine whether the termination of the lease was simply the consequence of a month-to-month lease or whether the termination was related to a taking. In making its decision, the court emphasized the original purchase offer and the language that it was only recommended to buy the billboard, and not that the eminent domain had been approved. The key distinction that prevented this from being a reverse sentencing claim was that there was no “unequivocal action or intention to condemn” on the part of the City.

Thus, the owner of the billboard was not entitled to any damages, including loss of goodwill, as there was never a “take” of the ownership interest of the billboard.


Look ahead

Not only has 2021 produced interesting case law from California courts and the U.S. Supreme Court, the infrastructure bill is expected to occupy prominent domain lawyers and the rights-of-way industry for several years as long-awaited infrastructure projects are starting to take. disabled. Stay connected to our blog, California Prominent Estates Report, for updates in 2022!