Re: The Boston Arch (Aquarium parking garage)
I am lazy and don't want to rewrite stuff I've already written. So here is an exerpt in the spirit of cut and paste (with references to the subject property deleted). To those who say the city couldn't take it by eminent domain, read on:
This memorandum outlines strategic issues associated with the use of eminent domain to acquire the XXXX property.
1. AUTHORITY
General Laws c.40, s.14 authorizes the City Council to vote to take by eminent domain under G.L. c. 79 “any land, easement or right therein within the city or town not already appropriated to public use, for any municipal purpose for which the . . . taking of land, easement or right therein is not otherwise authorized or directed by statute.”
2. INITIAL CONSIDERATIONS
A. Assume that any taking will result in litigation, and prepare accordingly.
B. Often an eminent domain plaintiff will not challenge the purported “municipal purpose” for a taking, as the plaintiff’s usual motivation is maximization of payment, not recovering property ownership. There is a greater risk of such challenge in “frustration of development” litigation. This is why you must establish a documentary and legislative record that sets out a worthy purpose for your intended action before the Council votes on the taking.
The court will void a taking for other than a valid “municipal purpose”. See Pheasant Ridge Associates L.P. et al. v. Town of Burlington, 399 Mass. 771 (1987), a notorious case in which the Supreme Judicial Court addressed a taking that was improperly motivated by the desire to frustrate development. See also City of Springfield v. Dreison Investments, Inc., Nos. 1999-1318, 99-1230 & 00-0014, 2000 Mass. Super. LEXIS 131, at *25-26 (Mass. Super. Feb. 25, 2000) in which the Superior Court struck down takings that did not have a valid municipal purpose.
“Municipal purpose” is discussed below in the “Order of Taking” section.
C. Obtain at least one appraisal of the property’s fair market value from a qualified appraiser before the Council adopts an “Order of Taking”. G.L. c.79, s.7A. (The statute allows this step to be dispensed with if the owner waives the appraisal and the payment of damages, an unlikely event in this particular matter.)
Your choice of appraiser is important. Some municipalities retain poorly qualified appraisers to save money on the required appraisal, or in the hope of obtaining a low appraisal figure that will “sell” the taking to a reluctant legislative branch. In my experience, this is a false economy because: 1) eventually you will have to hire a qualified appraiser as a trial witness, thus increasing your costs; 2) the existence of the less reliable appraiser will be known to plaintiff and may allow plaintiff to impeach your case at trial; and 3) a “lowball” appraisal creates an unreasonably low expectation of property cost. This latter phenomenon obstructs realistic pre-trial settlement discussions, and post-trial, has unpleasant political consequences when the “real” number is announced by the jury. See also discussion of “interest” in the “Final Considerations” section below.
It is always best to know the true cost from the start.
D. Your appraiser will determine value based on the “highest and best use” of the property. A “highest and best use” is that use which is legally permissible, physically possible and financial feasible. Roach v. Newton Redevelopment Authority, 381 Mass. 135 (1979) Gather all information available, with a particular emphasis on restrictions on the use of the property (e.g. zoning, building code, environmental limitations). The greater the restriction, the lesser the value. Do not fail to examine the Assessors’ records for evidence of abatements sought and the reasons given therefor.
You should give all such information to your appraiser. You should direct all City departments to cooperate speedily with your appraiser’s requests to them.
E. The landowner is entitled to “fair market value”, which is defined as the highest price, not the lowest or average price, which a hypothetical buyer would be willing to pay in a free and open marketplace. Tigar v. Mystic River Bridge Authority, 329 Mass. 514 (1952). If you take only a portion of a property, the landowner is entitled to payment for any diminution of value suffered by the part not taken. This is known as severance damages. G.L. c.79, s.12. Severance damages should not be overlooked, as an excision of one part from the whole of the property can leave the untaken remainder greatly injured in value.
F. General Laws, chapter 40, section 14 provides that “no lot of land may be purchased by any city subject to this section for a price more than twenty-five percent in excess of its average assessed valuation during the previous three years”. In my opinion, this limitation is inapplicable because a “taking” differs in nature from a “purchase” by virtue of its compulsion.
G. You may take an historical or archeological landmark certified under the provisions of G.L. c.9, §27, or a property owned, preserved and maintained by any historical organization or society as an ancient landmark or as property of historical or antiquarian interest, but only with prior approval of the Legislature. G.L. c.79, §5A
3. COUNCIL VOTE
Council action is a pre-requisite to the taking. The Council performs two functions: 1) it approves the instrument of taking (the “Order of Taking”) and, 2) it appropriates the money (“the damages”) that you will pay for the property. Council approval of an “Order of Taking” requires a majority vote. G.L. c.79, s.1; G.L. c.40, s.14. Council appropriation of damages requires a two-thirds vote. G.L. c.79, s.6; G.L. c.40, s.14. The two steps may be combined into a single motion, such as:
“I move to approve the Order of Taking for the XXXX property, and to (raise and appropriate/appropriate and borrow/transfer from YYYY) the sum of $_________ to fund such acquisition.”
This omnibus motion requires a two-thirds affirmative vote for adoption. You should ask Bond Counsel in advance of the vote to review any motion that uses borrowing as a funding source.