New ITC/METC Midland and Saginaw County Project for Meridian Park Windfarm?

New takings by ITC or METC likely to provide transmission line infrastructure to support DTE’s Meridian Park Windfarm in Midland and Saginaw Counties.

DTE has been proceeding with a new windfarm in three townships in Midland and Saginaw Counties. Porter and Mount Haley Townships in Midland County and Jonesfield Township in Saginaw County have been targeted for the new windfarm for a while. A recent newspaper article confirmed that construction on 70 wind turbines is intended to begin in April. 

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Michigan Court of Appeals Addresses Appellate Issues Relating to Necessity Challenges

The Michigan Court of Appeals held that agencies appealing a denial of necessity must seek leave and do not enjoy a right to appeal but limited successful property owner attorney fee reimbursement in limited instances. 

The Michigan Court of Appeals recently issued Consumers Energy Co v Storm, which is a decision for publication relating to a successful necessity challenge.

“Plaintiff sought an easement on defendants’ property that would stretch 80 feet from plaintiff's powerline onto defendants’ property, and would allow plaintiff to enter defendants’ property as necessary to maintain the powerline and to manage vegetation on the property that could threaten the line.” The property owners successfully challenged necessity.

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Sixth Circuit Recognizes Validity of Takings Claim

The federal appeals court covering Michigan recognized that impacts on access suffered as a result of the reconstruction of a driveway may support a takings claim. 

CHKRS, LLC v City of Dublin, No. 20-3435, 2021 WL 21808 (6th Cir Jan 4, 2021), addresses standing and the substance of takings claims relating to a residential driveway.

This case originated in Ohio and was heard by the Sixth Circuit Court of Appeals. The holding is pertinent in Michigan because the case involves analysis of federal law that applies in Michigan, federal law often informs Michigan state court decisions, and the Sixth Circuit includes the federal courts located in Michigan.

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Example of Successful Farm Market GAAMP Site Plan Approval

MDARD approved a client’s site plan in accord with the new Farm Market GAAMP.

I was retained by a client who purchased property to operate a farm market selling landscaping plants. The farmer grows material on the newly-purchased property and elsewhere for sale. However, the Township demanded that my client comply with extensive site plan requirements. My client estimated that the engineering alone, much less implementation of all the items requested by the township, could exceed the price paid for the property.  

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Court of Appeals Upholds Broad Attorney Fee Reimbursement After Successful Challenges

All reasonable attorney fees, including on appeal, are reimbursable after challenging a taking on jurisdictional or necessity reasons.

MCL 213.66 provides for wide reimbursement of property owner attorney fees and expenses, including where the property owner obtains increased just compensation, for expert expenses, and if there is a successful challenge to the taking. The Michigan Court of Appeals just upheld broad reimbursement when the attorney fees are sought in response to a challenge to the taking.

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Ann Arbor Seeking Right of Way for LynAnne-Arbana Sewer Project

Ann Arbor is seeking grants of new easements in an area north of Dexter Avenue and West Huron Street, between Lyn Anne Court and Arbana Drive.

The City is initiating the process of obtaining right of way for LynAnne-Arbana Sewer Project. Project information can be found here. A map of the project is partially reproduced below and also available on the City’s website.

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Michigan Supreme Court Refuses to Restrict Inverse Condemnation in Flint Water Case

Last week, the Michigan Supreme Court declined to adopt a narrow view of the unique or special injury element in inverse condemnation, allowing Flint water plaintiffs’ case to proceed.

The tragic events in Flint, Michigan relating to tainted water are well-known throughout the country.  Not surprisingly, they resulted in litigation.  Last week, the Michigan Supreme Court issued 132 pages of competing opinions. A clear majority of the Court declined to dismiss inverse condemnation claims made by Flint residents.  

First, the Court explained what inverse condemnation involves. “A claim of inverse condemnation is ‘a cause of action against a governmental defendant to recover the value of property which has been taken . . . even though no formal exercise of the power of eminent domain has been attempted by the taking agency.’  …  ‘Inverse condemnation can occur without a physical taking of the property; a diminution in the value of the property or a partial destruction can constitute a ‘taking.’” The majority then identified the elements for inverse condemnation. The Court did not break any new ground, relying upon past precedents. “‘[A]  plaintiff  alleging  inverse  condemnation  must  prove  a  causal  connection between the government’s action and the alleged damages.’ … Government actions directed at a plaintiff’s property must have ‘the effect of limiting the use of the property.’ … ‘[A]ll of the [defendants’] actions in the aggregate, as opposed to just one incident, must be analyzed to determine the extent of the taking.’ … A plaintiff ‘must establish (1) that the government’s actions were a substantial cause of the decline of the property’s value and (2) that the government abused its powers in affirmative actions directly aimed at the property.’”

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Pittsfield Township Announces Michigan Avenue Project

Plans will be released in September for a major road widening and non-motorized pathway project.

According to this MLive article, “Funding from the Michigan Department of Transportation will alter the stretch of Michigan Avenue between Carpenter and Platt Roads from two lanes to five, with the fifth being a center turn-lane, as a way of reducing traffic congestion…. Plans also include a 10-feet-wide non-motorized pathway, new interchange ramps and paved shoulders. The bridge at the U.S. 23 interchange will be replaced and constructed with right-turn lanes.”

Designs will be released in September. Those designs should identify whether additional right of way is needed, which would require acquisition of property through eminent domain. If condemnation is necessary, it could implicate significant just compensation issues, including reduced size, noncompliance, access restrictions, reduced parking, and increased development costs.  Further, when evaluating just compensation for partial takings like road widenings, it must be assumed that the newly acquired property rights will be exercised to the fullest extent allowed by law.

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Department of Agriculture Expands Protections Found in Farm Market GAAMP

The Department of Agriculture exercised power granted by the Right to Farm Act to issue a new Farm Market Generally Accepted Agricultural Management Practices that expands preemption of local ordinances.

The Michigan Right to Farm Act, MCL 286.471 et seq, (“RTFA”) encourages agriculture.

According to MCL 286.471, “[a] farm or farm operation shall not be found to be a public or private nuisance if the farm or farm operation alleged to be a nuisance conforms to generally accepted agricultural and management practices according to policy determined by the Michigan commission of agriculture.”  MCL 286.473 (emphasis added). The “policy” referenced in the statute are the GAAMPs, which is an acronym for the “generally accepted agricultural and management practices” language contained in the statute. Id.  According to MCL 286.474(6), “it is the express legislative intent that [the RTFA] preempt any local ordinance, regulation, or resolution that purports to extend or revise in any manner the provisions of this act or generally accepted agricultural and management practices developed under this act.”  “[A] local unit of government shall not enact, maintain, or enforce an ordinance, regulation, or resolution that conflicts in any manner with this act or generally accepted agricultural and management practices developed under this act.” Id.

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Michigan Supreme Court Protects Property Rights in Tax Foreclosures

A recent decision prohibits government agencies that foreclose on property for unpaid taxes from keeping excess amounts to the extent that the proceeds of the auction sale are greater than the delinquency owed.

Last week, the Michigan Supreme Court issued a decision on two companion cases, titled Rafaeli, LLC v. Oakland Cty., No. 156849, 2020 WL 4037642, at *5 (Mich. July 17, 2020). In that decision, a property owner owed $8.41 in taxes and $285.81 in interest and penalties. Oakland County foreclosed upon the property, sold it at auction for $24,500, and kept all of the proceeds. In a second case, a property owner owed approximately $6,000 in taxes and the property sold for $82,000 at a foreclosure auction, with the County keeping all the proceeds. The property owners sued, alleging that by “retaining the surplus proceeds from the tax-foreclosure sale of their properties, [the government] had taken their properties without just compensation in violation of the Takings Clauses of the United States and Michigan Constitutions.” Id., at 6.  The County responded by asserting that “plaintiffs forfeited all interests they held in their properties when they failed to pay the taxes due on the properties.” Id. The County’s position was supported by the General Property Tax Act or GPTA.

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More Right of Way Agent Chicanery Involving Appraisal Fees and Attorney Expenses

Notwithstanding what a right of way agent may tell you, Michigan law recognizes your right to obtain an independent appraisal at the agency’s expense and attorney consultations are generally handled on a contingency fee basis.

I recently learned from some clients that a right of way agent told them that they had no choice but to accept the appraisal undertaken by that agency. The clients were also told that they should not consult an attorney due to the expense. Finally, they were told not to speak with their neighbors.

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Eminent Domain Provisions in Commercial Leases

Certain steps should be taken in commercial leases eminent domain provisions regardless of whether they are negotiated from the perspective of the landlord or tenant. 

I am perhaps unique in Michigan in that I have handled hundreds of cases both in eminent domain and relating to commercial leases. That experience includes both drafting eminent domain provision language for landlords and tenants or representing both in condemnation cases. 

Eminent domain provisions are often lacking. This stems from three basic problems.

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The Use of Eminent Domain Powers to Combat COVID-19

The federal government has been delegated authority to exercise eminent domain to acquire both real and personal property, including the right to take immediate possession of that property, through the Stafford Act, which President Trump has cited as a basis for emergency powers due to the COVID-19 virus.

The Stafford Act is one of the statutory authorities cited by President Trump when he declared that the COVID-19 virus has caused a national emergency. 

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ITC/METC Active in the Marshall Area

METC/ITC right of way acquisition agents are seeking easements for the construction of the new transmission line near Marshall.

ITC right of way agents are contacting people in the Marshall area about a new transmission line. If you have been contacted by ITC, you should review this blog post, which summarizes issues implicated by an ITC taking. 

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Consumers Temporary Easement Case Dismissed Due to Lack of Jurisdiction

I successfully argued that Consumers failed to make a proper good faith offer requiring dismissal of a suit in Macomb County Circuit Court seeking acquisition of a temporary construction easement to install a pipeline. 

Consumers Energy Company filed a lawsuit in Macomb County Circuit Court seeking to acquire a temporary easement. Consumers wish to use the parking lot of a shopping center at the southeast corner of Van Dyke and 23 Mile Road as a construction staging ground to bore a replacement natural gas pipeline. 

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Army Corps of Engineers Requiring Local Governments Use Eminent Domain to Combat Flooding

To be eligible for federal funding, local governments must commit to using eminent domain to remove houses with a likelihood of flooding and risk of danger to the occupants.

All Americans have seen the images of communities devastated by flooding. The United States Army Corps of Engineers is the federal agency in charge of preventing that flooding. For years, the Army Corp has been seeking to remove homes that are prone to flooding. Now, with the threat of climate change, the Army Corp is taking a more aggressive posture. Rather than purely voluntary programs, the Corp is demanding that localities commit to using eminent domain to cause the removal of homes.

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Interesting Condemnation Cases – Road Commission Unwittingly Takes Developable Lot

In this case, the Road Commission offered a pittance to acquire a drainage easement and paid a small fortune because it actually destroyed a developable lot.

Early in my career, I handled what on its face appeared to be a minor acquisition of a drain easement to service 14 Mile Road. The easement was acquired by the Road Commission to allow drainage from 14 Mile Road, where the road was dirt and needed to drain towards a branch of the Rouge River. The property from which the easement was taken has on the top of a valley overlooking the river. 

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Interesting Condemnation Cases – Biff’s Grill and the One Recovery Rule

Biff’s Grill v DOT illustrates the one recovery rule and demonstrates why an agency is assumed to use its newly acquired property rights to the fullest extent allowed by law.

Two condemnation rules operate in tandem. A property owner is not allowed to demand additional condemnation proceeds from an agency if an agency uses the property rights it acquired in a more onerous manner than originally intended. For that reasons, when an agency acquires rights in a partial taking case, it is assumed that the agency will use those rights to the fullest extent allowed by law.

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METC Filing New Condemnations in Coldwater

METC has filed multiple lawsuits in Branch County Circuit Court to gain property rights allowing expansion of and tree clearing around existing transmission lines.

METC, which is related to ITC, has filed a series of lawsuits in Coldwater. According to the complaints, METC purchased a transmission line from the City of Coldwater that was constructed in the 1950s. METC alleges that it will be making improvements to this transmission line. However, there are no recordable real estate rights encumbering the properties adjacent to this transmission line, which includes both improved commercial properties on Michigan Avenue and residential homes. METC seeks to impose an expansive easement upon these properties, allowing significant rights to alter the existing transmission line and clear cut vegetation.

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Keystone Pipeline Leaks Oil

Continuing publicity about pipeline leaks demonstrates both their dangers and market awareness of those dangers.

One would expect older pipelines to have problems, including leaks. Indeed, the replacement of older pipelines is identified as a justification for constructing newer pipelines. However, even new pipelines can have problems. I have detailed problems that have occurred during pipeline construction, as exemplified by the problems surrounding the ET Rover pipeline. On Halloween, the most controversial pipeline constructed in recent history, the Keystone Pipeline, leaked. According to CNN, and a press release issued by TC Energy Company, “part of the Keystone 1 Pipeline in North Dakota was shut down after a leak of about 9,120 barrels of oil -- 383,040 gallons -- was discovered” resulting in 2,500 square yards being impacted by the released oil.

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