The Hudson County Improvement Authority’s bid to buy out stakeholders at Christ Hospital is in the works and there’s talk that Jersey City could foot some of the bill for the eminent domain proceedings.
Next week, the city council will vote on a resolution to contribute $10,000 to reimburse Hudson County for evaluating the Christ Hospital properties. That payment raises questions about whether the city will chip in for more of the expenses related to the eminent domain proceedings in in the future.
The money would be an “initial deposit” used to reimburse the authority under the terms of the resolution. It would be for “all professional charges incurred in connection with the evaluation of the acquisition of the medical center and negotiations with the interested parties and/or preparation of any agreements and undertaking research relating thereto.”
City spokeswoman Kimberly Wallace-Scalcione said in an email that the resolution seemed to leave open the possibility of using city funds for the eminent domain proceedings.
“The COVID-19 pandemic has only brought more awareness to the importance of Christ Hospital serving Jersey City,” Wallace-Scalcione said. “The Mayor is committed to protecting Christ Hospital, and we are partnering with the county to use all the tools we have at our disposal.”
Last month, Hoboken’s city council passed a nearly identical resolution to contribute $10,000 toward an eminent domain evaluation. But city spokesman Vijay Chaudhuri said there were no plans to contribute towards a larger payout. “The city does not intend to utilize funding for an eminent domain proceeding regarding the hospital,” Chaudhuri said.
Joyce Watterman, Jersey City Council President, said the city was just trying to help with the proceedings. This is due to the fact that the county is struggling financially. “Jersey City’s trying to do what it can do,” she said. But she continued her comments by saying that the city was only considering helping with the initial evaluation. The city council is still undecided about contributing to a possible eminent domain payout in the future.
“Let’s just do the first step,” she said. “You don’t want to bite off more than you can chew.”
Earlier this month the Hudson County Improvement Authority began the process of assessing the hospitals’ property value through eminent domain.
CarePoint Health has been trying to sell the three hospitals since last year. In October, RWJ Barnabas signed a letter of intent to buy Christ Hospital and Hoboken University Medical Center. And BMC Hospital, LLC, a group of healthcare investors, announced last month that it had finalized a deal to buy Bayonne Medical Center.
Of course, there is more to the story – there always is! The sales have been complicated by Alaris Health owner Avery Eisenreich. A month after CarePoint Health announced the sale of Christ and HUMC to RWJBarnabas, Eisenreich bought the property under Bayonne Medical Center and 70% of the land under Hoboken University Medical Center. He also owns 25% stakes in both the Christ Hospital land and operations.
Officials have accused Eisenreich of holding up the sales of the three hospitals through his land holdings. Last month, the county board of freeholders voted to begin eminent domain proceedings to buy out Eisenreich’s stakes.
Large eminent domain payouts would be a heavy burden on Hudson County, and if similar situations happen nationwide to local governments as they all deal with the financial fallout from the coronavirus.
CarePoint owns 11 Jersey City properties, in addition to Christ Hospital, that are associated with the acute care hospital. The properties were valued at $135 million in 2012.
Councilman-at-large James Solomon said the city’s $10,000 proposal was a sign of the importance of Christ Hospital. “Keeping the hospital in Jersey City is an important thing, so it made sense to me that the city would make a small contribution to the appraisal,” he said.
As for a larger contribution down the line, Solomon said he was open to discussions about it.
“From (a) overall health of the city perspective, it’s important that we have the hospital capacity,” said Solomon. “As we saw during COVID, we need it.”
A proposed pipeline is getting the okay to exercise eminent domain power on certain areas of the state. The green light was given by New York’s highest court this week which said that federal approval was good enough.
On June 25, 2020 the Court of Appeals filed its order in favor of National Fuel Gas Supply Corp., the pipeline-builder. The company expects to construct a 99-mile natural gas pipeline in Pennsylvania and western New York.
As often happens with eminent domain, the people who own the land fight back. National Fuel wanted to build a 50-foot wide permanent easement and the couple that owned the property resisted. When the negotiations failed, National Fuel decided to exercise the eminent domain authority given to it by a Federal Energy Regulatory Commission certificate of public convenience and necessity.
Part of the argument from the couple stated that National Fuel’s certificate was invalidated by failure to obtain water quality certification from the New York Department of Environmental Conservation.
“(W)hile DEC retained authority to grant or deny National Fuel’s application for a water quality certification (unless deemed waived), such authority did not extend either to invalidating a previously issued FERC certificate… where FERC placed no such conditions on the certificate’s effectiveness or to blocking eminent domain that might otherwise properly proceed under the certificate and (New York’s Eminent Domain Procedure Law),” Judge Leslie Stein wrote. “It remains within FERC’s purview to determine the effect of the DEC’s denial of National Fuel’s certificate of public convenience and necessity, and to stay or revoke the certificate if it deems it appropriate to do so.”
Judge Jenny Rivera disagreed in a dissenting opinion and said that the FERC certificate conditioned the project on completion of state mandatory assessments.
“(N)o good can come from this,” Rivera said. “Indeed, the majority misinterprets the federal regulatory process and the EDPL condemnation framework, and in doing so sanctions the condemnation of private property for development projects that may never gain financial approval.
“I do not see how the public benefits from the premature taking of private land…”
As shown by these dissenting opinions, the controversy surrounding eminent domain remains strong. This ruling is reminiscent of Kelo v. City of New London, where the Court held that the problems of large-scale urban blight need to be addressed with large-scale redevelopment plans, and that land can be appropriated then transferred to a private entity for a clearly defined public use.
New York is a very condemnor friendly state. It is always important to contact an experienced eminent domain attorney if you are faced with the seizure of your property.
This story is from a while ago, but we’ve resurrected it because, well, it’s about a ghost. We also want to skip a week of talking about COVID-19, and you’ll have to read on to see if we mention anything about eminent domain and New York Lawyers.
Apparently, there is a ruling, an infamous ruling, called the “Ghostbusters Ruling”. It regards a New York house that was legally deemed haunted. Honestly, we didn’t know that there was such a ruling until we read it in the news. It certainly caught our attention, though.
Some people like to visit haunted houses at amusement parks, others decorate their houses like a haunted house for Halloween, and there are even some that would love the opportunity to spend a night in a haunted house. However, due to the "Ghostbusters Ruling," no one can be tricked into buying a haunted house. Yup, no “trick or treat” or just tricks. It’s perfectly legal to go looking for evidence of the paranormal as a hobby, but unwittingly moving in with a ghost isn't something that most homebuyers look for on their list of desires.
Here’s a very real example. Jeffrey and Patrice Stambovsky purchased a home in Nyack, New York, without being told by the previous owner, Helen Ackley, that it was well-known to be haunted. (We took a pause here, because if we were shopping for a house and the homeowner said that it was haunted, we would be more scared about the stability of the homeowner than of the house).
Ok, back to the story. The Stambovsky’s purchase the house, realize that it is haunted, and filed the intriguing Stambovsky v. Ackley case. (We also wonder what type of lawyer takes on a haunted house bought by mistake case, but we can leave that for another day).
The result of the case was the "Ghostbusters Ruling." Needless to say, it had a “monumental” (a bit of ghost humor here) impact on legal precedent. Regardless of whether or not the house in Nyack is actually haunted, it has been legally ruled as such and must be represented that way in any future real estate deals.
We are confused too! So, here’s how it all went down. First, The Stambovsky family did not google anything about their new home obviously. (You can google the address: 1 Laveta Place in Nyack) As it turns out, the Ackley family was quite public about their home's ghosts and a story was featured in the May 1977 edition of Reader's Digest and was also mentioned in the local newspaper a few times.
Helen Ackley, the homeowner said that since the 1960s, the house was haunted by one ghost and it even gave the family gifts. The house became part of the city's walking tour, a prime indicator of just how notorious the story was.
After telling people for so many years that the house was haunted, Helen Ackley apparently made zero attempts to disclose this information to potential buyers. The Stambovsky’s alleged that they did not find out about the “hauntings” until after they delivered a down payment on the home. Stambovsky considered the omission of this information to be an example of fraudulent misrepresentation. He took legal action-and a trial court dismissed his case; so he appealed. The Appellate Division agreed to hear the case in 1991.
A bench of five Appellate Justices delivered a split decision on the case. The majority (three Justices) ruled in favor of Stambovsky, with the remaining two Justices siding with the seller--Ackley. We seriously wish we could’ve been a fly on the wall in that courtroom!
Although New York has a long history of using the rule of caveat emptor (i.e., “buyer beware”), which makes the buyer alone responsible for inspecting the home and ensuring it is suitable for sale—in this case the Stambovsky buyers won. The ruling was based on the theory that a regular house inspection couldn't be expected to reveal whether or not a house was haunted.
The ruling became known as the "Ghostbusters Ruling,” after the movie. In its decision, the Court held that failing to disclose a house's reputation may be grounds for contract rescission. Interestingly, the house has had three different owners between the years 1991 – 2019 (makes you wonder whether anyone else had issues with the hauntings, or whether they knew about them and were fine with it?)
In case you are curious, the ghosts have names: Sir George, who was reportedly haunting the house along with his wife, Lady Margaret. A psychic stated that the spectral couple had died in England in the 1750's. While this makes for a good story, it is very confusing since the house is in Nyack, New York. What are English ghosts doing on this side of the pond?
This story gets even better. Seller Helen Ackley passed away in 2003, and her son-in-law, Mark Kavanagh, says that she now went back to haunt the house. Apparently, there were no territorial disputes between Sir George, Lady Margaret, and Helen Ackley; as during the court proceedings in 1991, Helen Ackley said that when she eventually moved, she would take the ghosts of Sir George and Lady Margaret with her.
Search online and you can find even more juicy details about the house and its list of owners (currently alive and currently haunting). Until next week, when we go back to the realities of our eminent domain practice that’s definitely not haunted. But then again, we’re based in New York City and haven’t been there in a while…