Keeping Current Property offers a look at selected recent cases, rulings and regulations, literature and legislation. The editors of Probate & Property welcome suggestions and contributions from readers.
- CONDOMINIUM: Liability for criminal acts. A condominium association may be held liable for injuries to a tenant's guest shot in the parking lot. An association has the same duties as a landlord to unit owners and guests who would be expected to use the common area, including protection from dangerous activities in the common area. Martinez v. Woodman IV Condominiums Homeowners Ass'n, 941 P.2d 218 (Ariz. 1997).
- DEEDS: Recording acts. A purchaser who has actual and constructive knowledge that a former owner has retained the right to reside in an apartment on the premises until her death is bound by that agreement, even though it was not recorded in the chain of title. Holleran v. Cole, 488 S.E.2d 49 (W. Va. 1997).
- EASEMENTS: Abandonment of railway right-of-way. Because grants in 19th century deeds to the railroad unambiguously conveyed only an easement, the property reverts to the grantors, or to the grantor's heirs, assigns or devisees, when the railroad abandons its right-of-way. The court held that the United States National Trails System Act was inapplicable because the defendant railroads did not rely on any actions taken under the Act. Consolidated Rail Corp., Inc. v. Lewellen, 682 N.E.2d 779 (Ind. 1997).
- EMINENT DOMAIN: Bad faith negotiations. An allegation of bad faith by the state in a condemnation action affects only the right of the state to take and must be disposed of before determining damages. It cannot be considered in determining damages. Commonwealth v. Cooksey, 948 S.W.2d 122 (Ky. Ct. App. 1997).
- EMINENT DOMAIN: Damages for precondemnation actions. Following Klopping v. City of Whittier, 500 P.2d 134 (Cal. 1972), the Nevada Supreme Court held that a landowner is entitled to damages when harm results from precondemnation activities and the condemning authority engaged in extraordinary delay or oppressive conduct. The court distinguished between the planning stage and the "acquiring stage." State of Nevada Dept. of Transp. v. Barsy, 941 P.2d 971 (Nev. 1997).
- EMINENT DOMAIN: Severance damages offset by both special and general benefits. The California Supreme Court overruled Beveridge v. Lewis, 70 P. 1083 (Cal. 1902), and later cases that held only special benefits could be offset against severance damages. The court reasoned that the property owner would be fully compensated for severance damages by permitting offset of both special and general benefits. The court also noted the difficulty in making the distinction between special and general benefits. Los Angeles County, Metropolitan Transportation Auth. v. Continental Dev. Corp., 941 P.2d 809 (Cal. 1997).
- FRAUDULENT DEED: Improvements with knowledge of fraud. A buyer purchased property, unaware that the seller had forged the signatures of his cotenants on the deed. When the cotenants informed the buyer of the forgery, he quickly built a house on the property and began to rent it. When the cotenants' interests were recognized and the court ordered partiton, the buyer claimed he should receive credit for the value of his permanent improvement to the property. The court denied the buyer an equitable remedy, noting that he had not erected the structure with "clean hands." Butler v. Hayes, 487 S.E.2d 229 (Va. 1997).
- LANDLORD AND TENANT: Common areas. The Arkansas Supreme Court held that an aged and legally blind tenant is not an invitee and, having access to the premises equal to the landlord, does not have a cause of action for alleged negligence unless the lease terms require the landlord to remove hazards from common areas. Wheeler v. Phillips Dev. Corp., 947 S.W.2d 380 (Ark. 1997).
- LANDLORD AND TENANT: Lead poisoning. The Minnesota Supreme Court discussed a landlord's duty to perform required lead abatement repairs in a reasonable manner and found this an independent duty not extinguished by the negligence of the poisoned child's caretakers. Canada v. McCarthy, 567 N.W.2d 496 (Minn. 1997).
- LANDLORD AND TENANT: Mitigation of damages. The Texas Supreme Court held for the first time that a commercial landlord has a duty to mitigate damages when the tenant breaches the lease and abandons the premises. The court noted that the overwhelming majority of states require mitigation as a result of the changes in the nature of landlord-tenant law. Austin Hill Country Realty, Inc. v. Palisades Plaza, Inc., 948 S.W.2d 293 (Texas 1997).
- LANDLORD AND TENANT: Smoke detectors. The mother of a deceased guest of the tenant of a single- family dwelling could not bring a negligence claim against the landlord for failing to install smoke detectors. The state fire code expressly exempted single-family dwellings from the smoke detector requirement. Redden v. Comer, 488 S.E.2d 484 (W. Va. 1997).
- LANDLORD AND TENANT: Vicious animals. A landlord is liable for injury in the common area over which it reserves control if it had knowledge of an adverse condition and sufficient opportunity to remedy the con-dition. The landlord's knowledge of a dog's growling may support a jury verdict against the landlord for injuries sustained when the tenant's dog attacked another tenant in a common area. The growling may demonstrate vicious propensities even though the dog had not bitten anyone. Mongeon v. A&V Enter., Inc., 697 So. 2d 1183 (Miss. 1997).
- MECHANICS' LIENS: Street construction. A subcontractor's lien for work on a subdivision street before dedication and the city's acceptance of the street do not "relate back" so as to create a lien on the public street after it is dedicated and accepted. City of Westminster v. Brannon Sand & Gravel Co., 940 P.2d 383 (Colo. 1997).
- NUISANCE: View obstruction. On a question of first impression in Nebraska, the court of appeals adopted the majority rule that a lawful building or structure is not a private nuisance merely because it obstructs the view of neighboring property. Kruger v. Shramek, 565 N.W.2d 742 (Neb. Ct. App. 1997).
- TRESPASS: Treble damages. A plaintiff's neighbor and a logging company continued cutting timber on the plaintiff's land after being notified that it was on the plaintiff's land. The plaintiff, under Ohio statute, was entitled to treble damages as a civil penalty, even though the defendants were not convicted of the crime of trespass. Wooten v. Knisley, 680 N.E.2d 245 (Ohio 1997).
- ZONING: Abandonment of nonconforming use. The Supreme Court of Arizona held as a matter of first impression that a nonconforming use could be lost when nonuse for a period of one year is attributable to the property owner. Intent to abandon was not required. City of Glendale v. Aldabbagh, 939 P.2d 418 (Ariz. 1997).
- ZONING: Family defined. An ordinance defining "family" as a single housekeeping unit and not more than two additional unrelated individuals does not violate the due process clause of the state constitution. Nebraska v. Champoux, 566 N.W.2d 763 (Neb. 1997).
- ZONING: Inclusionary zoning. The plaintiff brought a second Mt. Laurel suit against the defendant township. On a question of first impression, a New Jersey trial court held that, in a second cycle case, when the municipality has failed to produce significant actual construction of affordable homes over the course of years despite a tremendous boom in its housing market and the municipality previously received credit for undeveloped sites in its inclusionary plan, the burden rests with the municipality to explain why the previously credited sites have not been developed. Toll Bros, Inc., v. Township of West Windsor, 697 A.2d 201 (N.J. Super. L. Div. 1996).
- ZONING: Special exceptions. Petitioners argued that a community music school was not eligible for special exception because it was not a "private school" as required by local regulation. Although noting that some courts in other jurisdictions have declined to consider instruction in the arts as education, the court found that the school was a private school satisfying the regulation. Neighbors on Upton Street v. Board of Zoning, 697 A.2d 3 (D.C. Ct. App. 1997).
- ESTATE TAX: Sale of remainder. The testator's sale of a remainder interest in ranch to his two sons for the ranch's actuarial value was for full consideration, even though he retained a life estate. Thus the ranch was not part of the testator's estate for federal estate tax purposes. Wheeler v. United States, 116 F.3d 749 (5th Cir. 1997).
- PASSIVE ACTIVITY. Taxpayers could not claim a suspended passive activity loss because there was no disposition of the interest in the passive activity to an unrelated taxpayer in a taxable transaction as required by Code 469(g)(1)(A). The taxpayers owned a house that they rented, thus subjecting the activity to the passive activity loss rules. The taxpayers sold the house to their son, who later sold it and deferred the gain under 1034 because he purchased a new principal residence. At this point, the taxpayers deducted their suspended passive activity losses with respect to the rental activity. Unless the taxpayers receive income from other passive activities against which the suspended losses can be applied, the taxpayers would have to wait until their son sold the new residence in a taxable transaction to deduct the suspended losses. TAM 9739004 (Sept. 26, 1997).
- ROLLOVER OF GAIN: Sale of principal residence. The Fourth Circuit has ruled that a taxpayer does not have to live with the same spouse in the old residence and the replacement residence to take advantage of Code 1034(g). Its decision overruled the Tax Court and held Treas. Reg. 1.1034-1(f) invalid. The taxpayer and her divorcing husband sold their house. Her share of the adjusted sales price was $178,000. The taxpayer and her new husband bought a residence for $181,000. According to the IRS, the taxpayer's share of this purchase price was $90,500, thus leading to the recognition of her $70,000 gain on the sale of the prior house. The court allowed the taxpayer to include her new husband's share of the purchase price ($90,500) in her cost of the new home under 1034(g), thereby allowing rollover of the $70,000 gain. Snowa v. Commissioner, 123 F.3d 190 (4th Cir. 1997).
- ENVIRONMENT: CERCLA. Rosemary J. Beless explores the "innocent landowner" statutory history and its case law relationship to environmental site assessments in Superfund's 'Innocent Landowner' Defense: Guilty Until Proven Innocent, 17 J. Land Resources & Envtl. L. 247 (1997).
- ENVIRONMENT: Nuisance law. In Keeping Pigs Out of the Parlor: Using Nuisance Law to Affect the Location of Pollution, 27 Envtl. L. 403 (1997), Andrew Jackson Heimert reviews the origins of nuisance law, analyzes statutory remedies and concludes that nuisance law has a place in protecting the environment and should not be preempted by statutes.
- HISTORIC PRESERVATION. In To Save and Save Not: The Historic Preservation Implications of the Property Rights Movement, 77 B.U.L. Rev. 111 (1997), Tyler E. Chapman presents an interesting analysis of the rise of the property rights movement as it affects historic preservation. He opines that the combination of the movement and historic preservation can provide a positive check and balance system in land use planning.
- LAND USE. The summer 1997 issue of The Urban Lawyer contains five articles on recent developments in land use law, including discussions of comprehensive plans, the first amendment, takings, gated communities, exaction and impact fees. Authors include Edward J. Sullivan and Thomas G. Pelham, Alan Weinstein, Thomas E. Roberts and Jonathan Davidson and Adam U. Lindgren. 29 Urb. Law. 361 (1997).
- LAND USE: Takings. John F. Hart continues his exploration of important moments in early American land use regulation and their modern ramifications in Forfeiture of Unimproved Land in the Early Republic, 1997 U. Ill. L. Rev. 435 (1997).
- RESIDENTIAL TRANSACTIONS. In Structural Change and Inter-Professional Competitive Advantage: An Example Drawn from Residential Real Estate Conveyancing, 62 Mo. L. Rev. 241 (1997), Michael Braunstein has written an article of great interest to lawyers involved in residential real estate matters_or, as he contends, lawyers who are now relegated to the margins of what was an extensive practice.
- UNIT OWNERSHIP ACT. In Condominiums, Reform and the Unit Ownership Act, 58 Mont. L. Rev. 495 (1997), Robert G. Natelson describes the Montana Unit Ownerships Act as a "safe harbor" statute and argues that the act is preferable to the Uniform Condominium Act and the Uniform Common Interest Ownership Act.
- Florida enacts a brokerage relationship disclosure act. The act provides for notice of nonrepresentation and disclosure of authorized relationships. Fla. Stat Ann. 475.01.
- Illinois enacts a rent control preemption act. The act bars local governments from adopting rent control ordinances except as to properties in which they have a property interest. Ill. Rev. Stat. ch. 50 825/5.
- Louisiana adopts minimum standards for instal- lation of manufactured housing. La. Rev. Stat. Ann. 51:9112.21.
Readers interested in a comprehensive review of current developments in real estate law are encouraged to subscribe to the ABA Real Estate Quarterly Report, which is prepared by the Real Property Division's Decisions Committee. For more information on this publication, contact LaPrica D. Mims at the Section office, (312) 988-6233.
Keeping Current_Property Editor: Nicholas L. White, School of Law, University of Memphis, Memphis, TN 38152.
Contributing editors: Ralph Brashier, Lars Gustafsson and David A. Thomas.
Probate & Property Magazine is published six times annually and is included in section members' annual dues.