Judges attack 'quick take' - Appeals court says city abused use of eminent domain for redevelopment plan

By Jill Rosen
Baltimore Sun reporter

April 13, 2007

Baltimore, MD - For the second time in two months, Maryland's highest court has found fundamental flaws in Baltimore's favored economic development strategy, a near-instantaneous type of eminent domain called "quick take."

In a decision released yesterday, the Court of Appeals soundly slapped Baltimore development officials for abusing the property seizure tactic in a way that, judges say, constrains a landowner's exercise of constitutional rights.

The court ruled that the Baltimore Development Corp. failed to show any justification for using quick take, which is intended for emergencies, to immediately seize the former Chesapeake Restaurant on North Charles Street in 2005 for a redevelopment project.

"There certainly was no evidence that quick-take was necessary for the public's health, safety, or immediate welfare, and it was not asserted that [the property owner] was a 'holdout' of any sort," wrote Judge Dale R. Cathell.

"In fact, the city had the power to initiate condemnation for approximately a year and a half and chose to wait, apparently, until the last minute, and then decided to make use of a type of action that curtailed the property owner's ability to present a defense."

The high court came down hard on Baltimore's quick-take technique in February, too, ruling that the BDC had no urgent need to seize a Charles North bar called The Magnet owned by George Valsamaki.

Yet another challenge - this time from a group of west-side shop owners who said the BDC's secretive ways kept them from fighting the agency's seizure of their property for the superblock redevelopment effort - prompted the high court in November to force the BDC to open its books and meetings.

George Nilson, Baltimore's city solicitor, said yesterday that the court's message, underscored in the Valsamaki case, is that the city must change its ways - though not necessarily stop using quick take.

"The Court of Appeals could have thrown out the quick-take process. It didn't," Nilson said. "It reminded us - not that we needed to be reminded - that we have a burden of proof to establish before a taking."

The Chesapeake seizure happened before the Valsamaki ruling. Since then, Nilson said, Baltimore has reformed. He said those involved with eminent domain - both at the BDC and the city's housing department - now understand that they must make stronger cases for takings and that quick take is not always the answer.

"The next time a quick take comes up - and it will be soon - we'll have everything ready to go," Nilson said. "There will be compelling cases for quick take."

During arguments before the Court of Appeals a month ago, the city vigorously defended its seizure of the long-closed Chesapeake Restaurant, saying owner Robert Sapero's refusal to sell was scuttling a $50 million renovation of the Charles North area.

In the fall of 2005, although Sapero said he was about to sell the prominent property, which sits a few doors down from the popular Charles Theatre and about a block from Pennsylvania Station, the BDC promised it to private developers, Station North Development Partners LLC. The developers had a $50 million plan for a complex of condominiums, townhouses, artists lofts, shops, restaurants, a parking garage and an art gallery...

The developers include Tower Hill Development & Consulting LLC; Michael and Alan Shecter, who own The Charles Theatre and the Everyman Theater; Florida-based developer the Miller Group; and Stephen A. Masciola.

The city seized the restaurant that December, offering $770,000 for it even though Sapero, who bought the restaurant in 1986, said he had a contract with someone for $2 million.

"It is interesting that their appraisals were so woefully low when compared with the modern marketplace," Sapero's attorney Alan R. Engel said yesterday. "It's 'If you don't make a deal with us, we'll just go in and take it right now.' That's the abuse the court is trying to protect all citizens from."

The court accused Baltimore of using quick take, which gives property owners just 10 days to challenge seizures, as a "litigation tactic," bringing it in when purchase negotiations with property owners break down.

Both Valsamaki and Sapero complained that the quick-take process was so fast that it left no time for their attorneys to use the discovery period of the suit to gather information to defend their cases.

"The use of quick-take should always be subject to close scrutiny," Cathell concluded. "It must not be forgotten that private property rights are fundamental constitutional rights."

The Court of Appeals remanded the case back to Circuit Court.

Timothy Sandefur, an attorney with the Pacific Legal Foundation who wrote a brief in the Valsamaki case, said these decisions show Maryland's high court is not only "strongly in favor of property rights" but "really upset by the abuse of the quick-take power by local officials."

"In recent years, courts have tended to defer to local officials to such a degree that city officials think that they can do pretty much whatever they want with people's property," he said. "It's refreshing to see a court stepping in and saying no, the Constitution limits what you can do."

By limiting quick take, Maryland joins a handful of states whose judiciaries have restrained the property seizure powers that the U.S. Supreme Court granted government in 2005's Kelo v. New London decision. There the high court ruled that government can take homes or businesses for private economic development projects.

Armando Carbonell, a senior fellow at the Lincoln Institute of Land Policy in Massachusetts, said with the Kelo backlash, governments are becoming "sensitized" to eminent domain controversy. However, he adds, it's still an important revitalization tool for cities like Baltimore.

"It is not the preferred way of doing planning and making cities," Carbonell said, "but it may be the necessary way in some cases. We need to proceed in a thoughtful way and use it conscientiously."
jill.rosen@baltsun.com


Copyright © 2007, The Baltimore Sun
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