Eminent Domain Law

Supreme Ct., Kings Cty.

(Saitta, J.)

In an eminent domain proceeding, the parties disputed the zoning designation applicable to the condemnation proceeding. After a hearing, the court held that the property should be valued under the zoning ordinance in force before the property was acquired by the city, not the ordinance enacted on the same day as the acquisition.

Four separate claimants owned property located in the north half of Block 146 in Brooklyn. Until May 10, 2004, the claimants' parcels had been zoned C6-1, allowing development to an FAR of 6. On that date, the parcels, along with the larger surround area, were rezoned C6-4.5, permitting an FAR of 12. On the same date, however, the city planning commission approved 21 other “related” items, including approval of the Fifth Amendment to the Brooklyn Center urban renewal plan, which designated the properties for acquisition by the city to be used as open space known as Willoughby Square, and which approved a special permit for construction of an underground public parking garage below the proposed square. When the city condemned the property, claimants contended that the property should be valued under the C6-4.5 zoning designation, while the city contended that the properties should be valued under the prior C6-1 designation.

In upholding the city's position, the court acknowledged that rezoning the claimants' parcels was not necessary to accomplish the city's goal of devoting the parcels to open space. But the court emphasized that the rezoning and the acquisition were related: The city rezoned the larger area to permit more intensive commercial development which would be more attractive to developers if the claimants' parcels were devoted to open space. The court found that the city would not have acquired the property but for the rezoning. As a result, the court held that the rezoning and the acquisition were part of the same project, and that claimants' parcels should therefore be valued by reference to the zoning in effect before approval of the project.

COMMENT

The Miller rule provides that property condemned under eminent domain should be valued without consideration of any increases or decreases in value caused by the very project for which it is being taken. In U.S. v. Miller, 317 U.S. 369 (1943), the court rejected the claim that compensation should reflect the value of condemned land on the day of the actual taking when that value had increased substantially after announcement of the project for which the land was condemned. The condemnees' land was needed to relocate a railroad line that was going to be flooded due to a dam building project approved a year earlier.

Though the Miller case did not involve zoning, New York courts apply the Miller rule when the project that requires condemnation includes zoning changes which increase the value of the land. For example, in Matter of City of New York v. Zahav, 106 A.D.3d 418 (2013), thecourt rejected the argument of several condemnees (whose land had been taken for use as public space) that the City should have valued their land more highly because the
surrounding area had been rezoned from manufacturing to a higher density, mixed-use designation. Due to the Hudson Yards redevelopment plan and the expansion of a subway line to the area, the City had rezoned several properties in the neighborhood to allow for development of housing and businesses, and had also condemned several neighboring properties for use as public space. The court applied the Miller rule in finding that the City had properly ignored the zoning changes when valuing the land taken for use as public space, since the rezoning was an integral part of theredevelopment project and would not have occurred otherwise. Id. at 419.

New York courts have not applied the Miller rule when the condemnee has shown that it was not likely that his land was going to be taken for the project as initially committed to by the government. For example, in Andrews v. State, 9 N.Y.2d 606 (1961), the court held that the lower courts properly valued the condemnees' land based upon the increased value of land in the area, which was caused by a hydro-electricity development project. The court found that the land was taken as part of an expansion of the original project after it had begun, and the building of power lines on the condemnees' land was not contemplated in the original project. Id. at 607-608. Presumably if the land was not originally included in the project at issue, the landowner could have sold the land and realized the increase in value due to its proximity to the project. The Miller opinion itself recognized that a landowner should not lose this value because the government later decided to condemn the land. See Miller at 376-377.

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Condemnor Has Broad Discretion

Matter of Peekskill Heights, Inc. v. City of Peekskill Common Council

NYLJ 11/1/13, p. 26, col. 1

App. Div, Second Dept.

(memorandum opinion)

In a proceeding pursuant to Eminent Domain Procedure Law section 207, landowner sought judicial review of a common council determination that a portion of landowner's commercial property was necessary for construction of a central firehouse. The court confirmed the determination, holding that landowner had failed to demonstrate a basis for upsetting the council's determination.

The council decided to acquire the disputed land to build a firehouse that would address the aging condition of existing firehouses. Landowner complained that the acquisition was not related to a public purpose, that other sites would be better serve the city's purposes, and that the proposed taking was excessive.

In dismissing the proceeding, the court emphasized the narrow scope of judicial review, which is limited to determining whether the proceeding was constitutional, whether the acquisition was within the condemnor's statutory authority, whether the condemnor made the requisite findings, and whether the acquisition will served a public purpose. Here, the court concluded that the acquisition was related to a public purpose, and held that incidental benefit to private persons or entities would not invalidate a condemnation. The court noted that a condemnor has broad discretion to determine what land and how much land is necessary to serve a public purpose, and held that condemnor had made a rational determination.

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Property Should Be Valued Under Prior Zoning Classification

Matter of Application of City of New York (Fifth Amended Brooklyn Center Urban
Renewal Area)

NYLJ 11/13/13, p. 2, col. 3

Supreme Ct., Kings Cty.

(Saitta, J.)

In an eminent domain proceeding, the parties disputed the zoning designation applicable to the condemnation proceeding. After a hearing, the court held that the property should be valued under the zoning ordinance in force before the property was acquired by the city, not the ordinance enacted on the same day as the acquisition.

Four separate claimants owned property located in the north half of Block 146 in Brooklyn. Until May 10, 2004, the claimants' parcels had been zoned C6-1, allowing development to an FAR of 6. On that date, the parcels, along with the larger surround area, were rezoned C6-4.5, permitting an FAR of 12. On the same date, however, the city planning commission approved 21 other “related” items, including approval of the Fifth Amendment to the Brooklyn Center urban renewal plan, which designated the properties for acquisition by the city to be used as open space known as Willoughby Square, and which approved a special permit for construction of an underground public parking garage below the proposed square. When the city condemned the property, claimants contended that the property should be valued under the C6-4.5 zoning designation, while the city contended that the properties should be valued under the prior C6-1 designation.

In upholding the city's position, the court acknowledged that rezoning the claimants' parcels was not necessary to accomplish the city's goal of devoting the parcels to open space. But the court emphasized that the rezoning and the acquisition were related: The city rezoned the larger area to permit more intensive commercial development which would be more attractive to developers if the claimants' parcels were devoted to open space. The court found that the city would not have acquired the property but for the rezoning. As a result, the court held that the rezoning and the acquisition were part of the same project, and that claimants' parcels should therefore be valued by reference to the zoning in effect before approval of the project.

COMMENT

The Miller rule provides that property condemned under eminent domain should be valued without consideration of any increases or decreases in value caused by the very project for which it is being taken. In U.S. v. Miller, 317 U.S. 369 (1943), the court rejected the claim that compensation should reflect the value of condemned land on the day of the actual taking when that value had increased substantially after announcement of the project for which the land was condemned. The condemnees' land was needed to relocate a railroad line that was going to be flooded due to a dam building project approved a year earlier.

Though the Miller case did not involve zoning, New York courts apply the Miller rule when the project that requires condemnation includes zoning changes which increase the value of the land. For example, in Matter of City of New York v. Zahav, 106 A.D.3d 418 (2013), thecourt rejected the argument of several condemnees (whose land had been taken for use as public space) that the City should have valued their land more highly because the
surrounding area had been rezoned from manufacturing to a higher density, mixed-use designation. Due to the Hudson Yards redevelopment plan and the expansion of a subway line to the area, the City had rezoned several properties in the neighborhood to allow for development of housing and businesses, and had also condemned several neighboring properties for use as public space. The court applied the Miller rule in finding that the City had properly ignored the zoning changes when valuing the land taken for use as public space, since the rezoning was an integral part of theredevelopment project and would not have occurred otherwise. Id. at 419.

New York courts have not applied the Miller rule when the condemnee has shown that it was not likely that his land was going to be taken for the project as initially committed to by the government. For example, in Andrews v. State, 9 N.Y.2d 606 (1961), the court held that the lower courts properly valued the condemnees' land based upon the increased value of land in the area, which was caused by a hydro-electricity development project. The court found that the land was taken as part of an expansion of the original project after it had begun, and the building of power lines on the condemnees' land was not contemplated in the original project. Id. at 607-608. Presumably if the land was not originally included in the project at issue, the landowner could have sold the land and realized the increase in value due to its proximity to the project. The Miller opinion itself recognized that a landowner should not lose this value because the government later decided to condemn the land. See Miller at 376-377.

'

Condemnor Has Broad Discretion

Matter of Peekskill Heights, Inc. v. City of Peekskill Common Council

NYLJ 11/1/13, p. 26, col. 1

App. Div, Second Dept.

(memorandum opinion)

In a proceeding pursuant to Eminent Domain Procedure Law section 207, landowner sought judicial review of a common council determination that a portion of landowner's commercial property was necessary for construction of a central firehouse. The court confirmed the determination, holding that landowner had failed to demonstrate a basis for upsetting the council's determination.

The council decided to acquire the disputed land to build a firehouse that would address the aging condition of existing firehouses. Landowner complained that the acquisition was not related to a public purpose, that other sites would be better serve the city's purposes, and that the proposed taking was excessive.

In dismissing the proceeding, the court emphasized the narrow scope of judicial review, which is limited to determining whether the proceeding was constitutional, whether the acquisition was within the condemnor's statutory authority, whether the condemnor made the requisite findings, and whether the acquisition will served a public purpose. Here, the court concluded that the acquisition was related to a public purpose, and held that incidental benefit to private persons or entities would not invalidate a condemnation. The court noted that a condemnor has broad discretion to determine what land and how much land is necessary to serve a public purpose, and held that condemnor had made a rational determination.

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