July 30, 2007

Cincinnati must pay $335,000 in attorney’s and witness fees to the owners of two fast-food restaurants in Clifton Heights who successfully challenged Cincinnati’s right to use eminent domain to take their properties.

Cincinnati must pay $335,000 in attorney’s and witness fees to the owners of two fast-food restaurants in Clifton Heights who successfully challenged Cincinnati’s right to use eminent domain to take their properties.

That’s the ruling by Hamilton County Common Pleas Judge Ralph Winkler, whose written decision included a stern scolding of Cincinnati for the way it used eminent domain.

“The City of Cincinnati should in the future be very careful when it initiates eminent domain proceedings against private property owners,” he wrote. “In this case, the city lost taxpayers’ money to legal fees and expenses.”

He cited the Ohio Supreme Court’s landmark ruling last year in the Norwood eminent domain case.

In that decision against Norwood, the court said it’s unconstitutional for a government in Ohio to use eminent domain to take property from a private property owner to give to another private property owner.

In the Norwood case, Rookwood Partners wanted to build a $125 million office, condo and retail development called the Rookwood Exchange.

In Cincinnati’s case, the city tried to use eminent domain to seize the property of the owners of former Hardee’s and Arby’s restaurants for the proposed $270 million redevelopment along Calhoun Street in Clifton Heights.

A study of that redevelopment area commissioned by the city and the developer, the Clifton Heights Community Urban Redevelopment Corp., called many of the properties “blighted” or “deteriorating.”

All the property owners except the owners of the two restaurants, located side by side, agreed to sell to the developer.

In January, the Ohio First District Court of Appeals overturned a lower court ruling in the city’s favor. Cincinnati decided not to appeal that decision.

The owners of the former Hardee’s and Arby’s restaurants asked for more than $470,000 in attorneys’ and witness fees.

Cincinnati City Solicitor J. Rita McNeil said the city hasn’t decided whether to appeal this ruling.

Matthew W. Fellerhoff, the lawyer for the two property owners, said his clients also hadn’t decided whether to appeal.

“They’ve been injured far greater than the amount of money they applied for,” he said.

Fellerhoff said his clients have suffered from the loss of business and the loss of opportunities because of the lawsuit and the demolition of the buildings in the vicinity of the two former restaurant buildings.

He said his clients have talked with the Clifton Heights redevelopment group about selling their properties, but no agreements have been reached.

Matt Bourgeois, director of the Clifton Heights redevelopment group, said the areas around the two buildings could still be developed.

“It would have been ideal to complete the assemblage of property and have a consistent block,” he said. “But we have substantial land on either side of their properties that are very developable.”

He said his group is talking to several developers who are interested in the site.