We are thinking back to all of the blog posts that we have shared over the past few years, and most likely, this one is one of the more serious.  We first read about it in The New York Times.
 
Last week the Supreme Court ruled that Plaintiffs may sue directly in federal court to seek just compensation as soon as state and local governments take their property through eminent domain.  This recent ruling overturned a 1985 precedent, Williamson County Regional Planning Commission v. Hamilton Bank, 473 U.S. 172 (1985), which required property owners to first sue in State Court when their property was acquired by a State or local government via eminent domain, before being allowed to sue in federal court.
 
The court’s more conservative justices in the major with a vote of 5 to 4.  What is so notable about the decision is about the court’s attitude toward precedent.
 
Writing for the majority, Chief Justice John G. Roberts Jr. said overruling the Williamson County decision was justified because it “was not just wrong. “Its reasoning was exceptionally ill founded,” he wrote. He added that the decision had “come in for repeated criticism over the years from justices of this court and many respected commentators.”
 
The most recent case was brought by Rose Marie Knick, who owns 90 acres of land in rural Pennsylvania near Scranton that includes a small family cemetery.  All cemeteries are required to be open to the public during daylight hours, according to the local township ordinance that was passed in 2012.  Ms. Knick sued in federal court, saying the ordinance violated the Fifth Amendment’s takings clause, which says private property may not be taken for public use without just compensation.
 
In the earlier Williamson County case, the Supreme Court held that lawsuits claiming violation of the federal 5th Amendment takings clause had to first be brought in State Court. Each State has its own constitution, and its own takings clause. The Williamson County Court further held that there was no violation of the takings clause until the state or local government failed to pay just compensation after state-court litigation.
 
Chief Justice Roberts disagreed.  Specifically, Justice Roberts wrote that:
 
Contrary to Williamson County, a property owner has a claim for a violation of the takings clause as soon as a government takes his property for public use without paying for it. A later payment of compensation may remedy the constitutional violation that occurred at the time of the taking, but that does not mean the violation never took place.  The violation is the only reason compensation was owed in the first place. A bank robber might give the loot back, but he still robbed the bank.”
 
 
In her dissent, Justice Elena Kagan said that the analysis was worrisome, “today’s opinion smashes a hundred-plus years of legal rulings to smithereens.”  She noted that the court had also overruled another major decision last month.
 
Quoting from Justice Stephen G. Breyer’s dissent in that case, “He wrote of the dangers of reversing legal course ‘only because five members of a later court’ decide that an earlier ruling was incorrect,” Justice Kagan wrote. “He concluded: ‘Today’s decision can only cause one to wonder which cases the court will overrule next.”
 
Justice Kagan also wrote that Chief Justice Roberts misunderstood the takings clause, which she said was not violated until the government failed to pay following proceedings about how much was owed.  “Today’s decision thus overthrows the court’s long-settled view of the takings clause,” she wrote. “The majority declares, as against a mountain of precedent, that a government taking private property for public purposes must pay compensation at that moment or in advance.”
 
The decision in the case, Knick v. Township of Scott, No. 17-647, she wrote, “will subvert important principles of judicial federalism.”
 
“Today’s decision sends a flood of complex state-law issues to federal courts,” Justice Kagan wrote. “It makes federal courts a principal player in local and state land-use disputes. It betrays judicial federalism.”
 
But Justice Kagan reserved her harshest criticism for the majority’s attitude toward to power of precedent. “It is hard to overstate the value, in a country like ours, of stability in the law,” she wrote.
 

A 19th century building is in the throes of an urgent campaign by community activists in an effort to save it from demolition.  There is extensive proof that 227 Duffield Street in Brooklyn was used as a safe haven for fugitive slaves during the abolitionist movement and several groups are attempting to have the building designated as a landmark.
 
The building has been on developers’ radars for a while and in June 2019 the City’s Department of Buildings approved an application to demolish the small lot.
 
“This should be a national landmark,” said Michael Higgins, an organizer at Families United for Racial and Economic Equality, one of the organizations lobbying the city to landmark the building. “Why can’t we figure out a way to save it?”
 
Families United for Racial and Economic Equality is being joined by Circle for Justice Innovations in the effort with a petition urging the city Landmarks Preservation Commission to designate 227 Duffield as a landmark. The wave of support has continued to grow with an additional 20 local elected officials, including Brooklyn Borough President Eric Adams.  He signed a letter to the LPC in support of giving the building landmark status. "With a lack of African American historical sites in Brooklyn, we cannot stop at the installation of statues recognizing historical figures," the letter read. "We must also work to preserve the physical movements of our ancestors."
 
According to Gothamist, a spokesperson for the LPC said they had "received a request to evaluate 227 Duffield Street as a potential landmark and it is currently under review.” Samuel Hanasab, a small developer, and the current owner of the building did not respond to questions.
 
Slavery in New York was abolished in 1827, but it was still illegal to harbor an escaped slave from the south.  The building’s late owner, Joy Chatel, always insisted that the property had been a stop along the city’s Underground Railroad.  It was made up of a loose network of homes, businesses and churches that assisted black fugitives making their way north to upstate New York and New England and Canada.
 
Kelly Anderson, a Brooklyn-based filmmaker, who made the film “My Brooklyn” documented some of the efforts to save the home along with a neighboring one at 233 Duffield Street from eminent domain, which the city was seeking as part of a plan to build a public park on the site.  When the film was made in 2006, it included images of what the owners said had been part of an underground tunnel between 227 and 233 Duffield.
 
A report by a planning and environmental firm done at the request of the city disputed that the site was used as part of the Underground Railroad, but was criticized by experts.
It is often difficult to provide if an area was used by the Underground Railroad.  Simeon Bankoff, the executive director of the Historic Districts Council, said that it is because of its clandestine nature. Those who participated in harboring escaped slaves put themselves at a high level of risk. Bankoff says that there is proof that the house was owned by two abolitionists, Thomas and Harriet Truesdell.  This fact is very much in favor of understanding if the site was indeed used as an Underground Railroad stop.  In addition, in 2007 the city abandoned its eminent domain request and renamed the street Abolitionist Place.
 
If the site is named a landmark by Landmarks Preservation Commission, it would not be the first time the City has intervened to protect buildings associated with the Underground Railroad.
In 2009, following a contested renovation of a mid-19th-century row house at 339 West 29th Street deemed to be the only surviving documented Underground Railroad stop in Manhattan, the City landmarked both the property and the neighboring ones as part of the Lamartine Place Historic District. This property, according to Bankoff, had historic records of its association with the Underground Railroad.
 
The area near 227 Duffield has seen robust development recently including two hotels, one on the same block and another across the street.  Recently residential buildings have been demolished and several businesses have left making way for further development.
 
It will be interesting to see what happens, and if Kelly Anderson will have enough material for a sequel to her film.

Recently, New York State passed rent reform legislation that would end high-rent/high-income deregulation.  The new law includes other clauses that limit rent increases due to building and apartment improvements, limits rent hikes, and affords new protections for mobile-home and apartment residents statewide. Governor Andrew Cuomo signed the law officially on June 14, 2019. 

Landlord groups are not happy about this new legislation, to say the least.  They have filed a lawsuit in federal court, arguing that the new laws are in violation of their constitutional rights.  The federal lawsuit alleges that the new rent laws approved in June violate the Fifth and Fourteenth Amendments of the Constitution, and therefore violate the constitutional rights of New York property owners.  
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Most relevant to our blog post, the landlords argue that the expanded rent-control laws violate the Fifth Amendment Takings Clause.  As you know, it’s that clause that states that private property cannot “be taken for public use, without just compensation."

Leading the fight are the Community Housing Improvement Program and the Rent Stabilization Association, along with seven landlords.  Named as defendants are the City of New York, its Rent Guidelines Board, and the State commissioner of Homes and Community Renewal (otherwise known as the DHCR).  The lawsuit claims that the State’s new Rent Stabilization Laws violate due process rights by depriving rent-controlled landlords of property “without any rational relationship between that deprivation and a legitimate government interest.” 

Landlord representatives argue that the new law will exacerbate a housing shortage and will not maintain diversity and solve part of the housing crisis.  They also argue that because market-rate apartments will be more expensive, property owners will be deterred from making building wide and individual apartment improvements.

Democratic leaders who passed this legislation disagree.  The Housing Stability and Tenant Protection Act of 2019 dramatically increased the price protections for the city’s stock of 1 million regulated apartments.  The legislation included a provision that that does away with a 20% vacancy increase landlords, which landlords could add to the legal regulated rent of a rent regulated apartment, in order to eventually get that legal regulated rent to the market rent at which the apartment could legally be deregulated.
The legislation also removed the process of luxury decontrol, which is when a rent-regulated apartment could be de-regulated, and thereby receive a market rent, if the tenant's income exceeded certain thresholds. 

This is a big blow to the real estate lobby, once a highly powerful group. Landlords are now asking for injunctive relief that would block the City and State from enforcing these new rent reform laws; and they argue that this a ruling barring enforcement of this law will help, rather than harm, tenants living in rent regulated buildings.

Declaratory and injunctive relief against future enforcement of the rent-stabilization scheme will not only halt the deprivation of the constitutional rights of property owners,” the lawsuit argues, “but will result in increased development of rental properties, better housing for a larger universe of renters, the amelioration of a constrained housing market, and will force New York City and state governments to adopt fairer and more efficient means of providing housing to those most in need.”

With all of the foreign investment in real estate and the dramatic changes reaching the boroughs, it will be interesting to see how this all turns out.