By Antonio D. French
Filed Wednesday, April 25, 2007 at 9:08 AM
Yesterday, the Missouri Court of Appeals reversed a trial court decision in favor of property owners fighting to keep their valuable downtown Clayton property from being condemned because of "blight". Labels: Eminent_Domain
"While we note that pursuant to section 353.020(1), an 'area' may include buildings that are not themselves blighted, but which are deemed necessary for the redevelopment, there is a lack of evidence of social liability as to any portion of the area," stated the judges' ruling.
In January, St. Louis County Circuit Judge James R. Hartenbach rendered a decision allowing Centene Redevelopment Corporation to condemn property owned by David Danforth, Dan Sheehan and Debbie Pyzyk so the company can build a multi-use retail area to support its corporate headquarters.
Under Missouri law this meant that Centene could proceed with the condemnation action and all activities related to the decision. However, once papers were filed to appeal the judgment, the Missouri Court of Appeals entered an order to halt any action by Centene until the Court could review the case and make its own decision. Only the Court of Appeals could legally grant a stay and stop the action by Centene.
Tueday's ruling said there was insufficient evidence to support a conclusion that the upscale area in question was a "social liability, and therefore blighted, under either the prior common law standard, or the more recent standard set forth in section 523.261. Therefore, we would hold that the trial court's judgment condemning defendants' properties was in error."
Knowing what this case could affect billions of dollars of development plans across the state, the Appeals Court decided to send the case to the State Supreme Court.
"We would reverse the judgment of the trial court as discussed above; however, because of the general interest and importance of the issues presented in this case concerning the applicable standard of review for a legislative determination of blight, and the consideration of social liability in the context of such a determination, we transfer the case to the Missouri Supreme Court."
Susan C. Ryan contributed to this report.
4 Comments:
Good.
This whole process of blighting, Eminent Domain, TIFs, and the rest of the so-called tools of redevelopement have been seriously abused. I understand Clayton wants to keep Centene but they (Clayton) shouldn't be allowed to steal the livelihoods of other people to do it.
If we will permit Eminent Domain actions at all: For lots of small businesses such as are established in Clayton, the business and the location or property are not easily separable, no matter what illusions an attorney might experience while staring at a balance sheet. If a developer wants the property, he should have to buy the whole business (i.e. the present value of the assets - liabilities plus the expected future cash flows under reasonable assumptions) and then a "coersion premium" on top of that. If the owner wants to retire — fine. If he wants to start a new business — fine. There is a question of what a business is worth, but while private equity valuation isn't quite a science, its much better than a guess.
In the case of a home, a developer should have to pay for something like a replacement home in a reasonably similar locale, plus a premium. He generally can't leave people with a bigger mortgage than they had. I realize this can be problematic in some cases, but that's why we have judges.
Property is prior to law — it came before any government. So Property must be afforded great, almost absolute, respect by the law.
As I see it, the only proper use of TIFs would be for the financing of things like road widening, adding sewers, and so-forth. Public things likely to outlive the development itself. That's it.
t
4/25/2007 1:04 PM
I can't understand a developer taking over another person's/business's property so that that developer can maximize his profits! It seems to go against democracy!
4/25/2007 6:54 PM
> It seems to go against democracy!
No, it doesn't. Democracy is what a majority vote on. Devil take democracy!
It goes against humanity.
t
4/25/2007 8:30 PM
Tom,
Agreed. I would only add "public things likely to outlive the development itself" AND that are absolutely NECESSARY for the betterment of a majority of citizens.
4/27/2007 10:28 PM
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