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.
- ADVERSE POSSESSION: Permissive use. Summary judgment upholding an adverse possession claim was improper, when the evidence raised a material factual issue whether the plaintiff's predecessor originally obtained possession of the property by permission. If the original use was permissive, the plaintiff would have the burden of proving that it or any of its predecessors in the chain of possession converted to hostile use. Pioneer Mill Company, Ltd. v. Dow, 978 P.2d 727 (Haw. 1999).
- BROKERS: Disclosure. Knowing that the buyer owned four dogs, a dual agent broker did not disclose to either party the existence of a restrictive covenant limiting dog ownership. The buyer later learned of the covenant through his lawyer, and the deal failed to close because of the broker's failure to obtain a waiver of the covenant. The house sold almost six months later to another buyer for $10,000 less than the first sale. The court held that the broker's failure to disclose the covenant resulted in the home being taken off the market for two months in the prime selling season, when it could have been sold to someone without dogs. Furthermore, the broker's lack of disclosure and inaction prevented the seller from seeking a waiver in time to preserve the original sale. Bazal v. Rhines, 600 N.W.2d 327 (Iowa Ct. App. 1999).
- CONDOMINIUMS: Assessment collection. The property manager for a condominium association was held not a "debt collector," and therefore not subject to the Fair Debt Collection Act, because the manager's debt collection activities comprised such a small portion of its management role and because its assessment collection activities began before assessments were in default. Alexander v. Omega Management, Inc., 67 F. Supp. 2d 1052 (D. Minn 1999).
- CONDOMINIUMS: Attorneys' fees. A condominium association sued to recover a $1,200 assessment. Although the assessment was paid, the resulting $500 in attorneys' fees was not. After 10 years of legal wrangling, the fees had risen to over $46,000. In finding for the association, the court held that the association did not have to use a "low priced" collections lawyer in lieu of its regular real estate lawyer, that the fees were fair and reasonable and that the legal services were necessary. Mountain View Condominium Ass'n v. Bomersbach, 734 A.2d 469 (Pa. Comm. Ct. 1999).
- CONSTITUTIONAL LAW: Equal protection. The court held that a property owner's claim for damages resulting from a city's failed attempt to exact an excessive easement as a condition for connection to the city's water system could survive summary judgment. There was sufficient evidence that the city's conduct may have been motivated by substantial ill will resulting from the owner's prior successful lawsuit against the city. Olech v. Village of Willowbrook, 160 F.3d 386 (7th Cir. 1998), aff'd per curiam (on different grounds), Village of Willowbrook v. Olech, 120 S. Ct. 1073 (2000).
- CONSTITUTIONAL LAW: Equal protection. A town ordinance provided for free garbage collection service to condominiums but not similarly sized rental apartments. Although the town claimed that the distinction made in the ordinance was rationally related to the legitimate state interest of promoting home ownership, the court found evidence of such relationship insufficient. WHS Realty Co. v. Town of Morristown, 733 A.2d 1206 (N.J. Super. App. Div. 1999).
- CONSTITUTIONAL LAW: Substantive due process. After a developer revised its subdivision application at the city's behest, the city's lawyer told the developer that the revisions met the city's standards for approval. Nevertheless, after a six month delay, the city denied the application without findings. The city later reissued the denial with findings based largely on suggestions from the opponents' lawyer. In the meantime, the developer lost its financing. In overturning summary judgment for the city, the court held that there was evidence the city's decision was inconsistent with its own rules, based on the letter of the opponent's lawyer and not its own deliberations, and was willfully delayed so that the developer would lose financing. Woodwind Estates, Ltd.. v. Gretkowski, 205 F.3d 118 (3d Cir. 2000).
- CONTRACTS: Third-party beneficiary. A lender knew a subcontractor had not been paid when it disbursed loan proceeds based on the contractor's affidavit stating that all potential lienors had been paid. After the contractor failed to pay the subcontractor and the subcontractor lost its construction lien by filing too late, the subcontractor claimed third-party beneficiary status under the loan agreement. The court held that the bank owed no duty to the subcontractor, because it was not an in-tended beneficiary of the loan agreement and was not a creditor of the borrower. Town and Country Home Ctr. v. Woods, 725 N.E.2d 1006 (Ind. Ct. App. 2000).
- EASEMENTS: Encroachment. During construction of a house, the owner was caught encroaching on the city's utility easement by 12 inches of roof eave. The court enjoined the city from stopping work on the house due to the encroachment because of the insignificance of the encroachment, the relatively minor inconvenience to the city and the innocent nature of the encroachment. Fettkether v. City of Readlyn, 595 N.W.2d 807 (Iowa Ct. App. 1999).
- EASEMENTS: Priority. Cox sold property to Jones, taking a purchase money mortgage. Jones then divided the land into two lots, one of which was landlocked. The landlocked parcel, after Cox released it, was later transferred to Trustmark, which sued to establish an easement by necessity over the Jones parcel. Before the suit went to hearing, Cox foreclosed on Jones' remaining parcel and argued that any rights that Trustmark had in that parcel had been foreclosed. The court held Cox's release of the landlocked parcel included an easement by necessity, which survived the foreclosure. Cox v. Trustmark Nat'l Bank, 733 So. 2d 353 (Miss. Ct. App. 1999).
- EASEMENTS: Trespass. A landowner contracted with a sign company to put up a sign using 57 support posts. After the relationship soured, the sign company won a replevin suit for the sign and removed it, leaving the posts behind. A later court held that, because the land-owner's original consent to allow the sign company to put the posts on the property was conditioned on a sign being placed on the posts, the consent ended when the sign company removed the sign. The Manor Enterprises, Inc. v. Vivid, Inc., 596 N.W.2d 828 (Wis. Ct. App. 1999).
- EMINENT DOMAIN: Compensable interest. A country club's assessment powers were held a compensable property right in an inverse condemnation proceeding brought when the city acquired some parcels by eminent domain and refused to pay the assessments. The court noted that the assessments were coupled with easements to use the country club property and that Florida law provided the country club with lien powers to collect the assessments. Palm Beach County v. Cove Club Investors, Ltd., 734 So. 2d 379 (Fla. 1999).
- MINERAL RIGHTS: Scope of interest. An environmental group owned rights to "coal and other minerals" reserved in a deed to a cement company. The cement company desired to operate an open pit limestone mine. The court overturned a summary judgment in favor of the environmental group, holding that the mineral rights reservation would not prevent mining of limestone. Under the doctrine of eiusdem generis, limestone was held not of the same class of mineral as coal. The mineral rights reservation was limited to minerals obtainable without disturbing the surface. Save Our Little Vermillion Env't, Inc. v. Illinois Cement Co., 725 N.E.2d 386 (Ill. Ct. App. 2000)
- SELLER AND BUYER: Exclusive negotiations. Seller and buyer executed a letter of intent for the sale of a building, providing that either party could terminate negotiations at any time. Although the letter did not provide for exclusive dealing, the seller made false oral representations to the buyer that the property was "off the market" and that the seller was not "shopping the deal." The court held that the false oral statements were not fraud, because the existence of the third-party bidder was disclosed before the buyer made its final and best offer. GMH Assocs. Inc. v. Prudential Realty Group, No. 198 EDA 1999, 2000 Pa. LEXIS 191 (Mar. 1, 2000).
- TAKINGS: Interest taken. After the state sold a parcel of riparian land to the upland owner on the condition that the riparian parcel be transferred only in conjunction with the upland parcel, environmental regulations rendered the riparian parcel completely worthless. The court held that, for purposes of determining whether the regulation had deprived the owner of virtually all economically viable uses of the property, the two parcels should be viewed as a single property because of the state's prior requirement that the same owner hold the parcels. The court concluded that there was no taking. Karam v. State of New Jersey, Dept. of Envtl. Protection, 723 A.2d 943 (N.J. 1999).
- Brokers' radon disclosure duty. Paul A. Locke and Patricia I. Elliott describe several possible theories for holding brokers responsible for nondisclosure, as well as several strategies for brokers to use to avoid liability, in Caveat Broker: What Can Real Estate Licensees Do About Their Potentially Expanding Liability for Failure to Disclose Radon Risks in Home Purchase and Sale Transactions?, 25 Colum. J. Envtl. L. 71 (2000).
- Contracts "subject to attorney approval." Alice M. Noble-Allgire considers the legal effects of Attorney Approval Clauses in Residential Real Estate Contracts-Is Half a Loaf Better Than None?, 48 U. Kan. L. Rev. 339 (2000). She suggests that model legislation, including mandatory contract language and mandatory disclosures by real estate agents, might help protect consumers from undue influence by parties encouraging a quick sale.
- Brownfield development and environmental justice. Brownfield sites often are surrounded by other uses attracted by low land costs. In Reforming State Brownfield Programs to Comply with Title VI, 24 Harv. Envtl. L. Rev. 115 (2000), Bradford C. Mank posits that communities seeking to attract industry to brownfield sites near poor, minority neighborhoods may be engaging in "environmental racism." Mank suggests ways that legislators and regulators should reform their brownfield programs to comply with Title VI of the Civil Rights Act of 1964 and avoid unintentional discriminatory impacts.
- Brownfield development obstacles. In One Piece of the Puzzle: Why State Brownfields Programs Can't Lure Businesses to the Urban Cores Without Finding the Missing Pieces, 51 Rutgers L. Rev. 1075 (1999), Heidi Gorovitz Robertson offers an explanation for why state brownfield programs are not meeting public expectations. She suggests that non-environmental issues, such as transportation infrastructure and labor supply, may influence industrial leaders' decisions about locating in a brownfield site at least as much as environmental concerns. She says communities should pay greater attention to non-environmental factors if they hope to improve urban renewal results with brownfield developments.
- Growth management issues. The results of enforcement of Washington's Growth Management Act since 1993 are the subject of Symposium, Revisiting the Growth Management Act, 23 Seattle U. L. Rev. 1 (1999). Clint Bolick and Timothy J. Dowling discuss urban sprawl and growth management in a point/counterpoint format. Clint Bolick, Subverting the American Dream: Government Dictated "Smart Growth" is Unwise and Unconstitutional, 148 U. Pa. L. Rev. 859 (2000), and Timothy Dowling, Reflections on Urban Sprawl, Smart Growth, and the Fifth Amendment, 148 U. Pa. L. Rev. 873 (2000).
- Takings jurisprudence. Five articles about the current status of regulatory takings jurisprudence provide interesting views on a variety of issues related to recent takings cases in Takings Law Symposium, 29 Envtl.L. 811 (1999). ddresses conflicts between the Telecommunications Act of 1996 and various federal laws designed to establish a system of national scenic hiking trails in T he Telecommunications Act of 1996 and Viewshed Protection for the National Scenic Trails, 15 J. Land Use & Envtl. L. 93 (1999).
- Telecommunications towers and national parks. James J. Vinch addresses conflicts between the Telecommunications Act of 1996 and various federal laws designed to establish a system of national scenic hiking trails in The Telecommunications Act of 1996 and viewshed Protection for the National Scenic Trails, 15 J. Land Use & Envtl. L. 93 (1999).
- Alaska revises the law of navigable waters. The act declares that the people of the state have a constitutional right of access to navigable and "public" waters; the state holds in trust for the people full power and control over such waters; and ownership of land bordering such waters is subject to the public right of use of the waters. Alaska Stat. 38.05.126, 38.05.128.
- Arizona revises residential landlord-tenant laws. Landlords must record with the county assessor current information about property ownership and the means of contacting a designated agent. Failure to provide the information carries a $1,000 penalty, and the property is subject to official inspection at the owner's expense. Ariz. Rev. Stat. 33-1901 et seq.
- Arizona restricts common interest property association members' inspection rights. Members are not entitled to inspect records in control of the board of directors that relate to personnel matters, medical records, communications with the corporate lawyer, pending litigation, pending matters involving enforcement of the corporation's rules or records of board meetings that were not open to the general membership. Ariz Rev. Stat. 10-11602.
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 Pam Hollins at (312) 988-5651.
Keeping Current-Property Editor: Eugene L. Grant, 1211 SW 5th Ave., Ste. 1600, Portland,OR 97204-3795. Contributing editors: Robert Flores and Terry Frazier.