Friday, March 01, 2013
Ind. Courts - "Judge could issue ruling on BSU-Hiatt dispute this month"
Remember the takings case involving Ball State and Hiatt Printing? From this Nov. 18, 2012 ILB post, headed "Should a highly respected Indiana trial judge, who was a star athlete for Ball State in the late 1970s, preside over a case involving the school?," quoting an opinion piece in the Muncie Star Press:
Last week saw the first official court hearing in Ball State University v. David and Jane Hiatt et al, the et al including directors of a trust and Chris Hiatt, operator of Hiatt Printing.Judge Vorhess has since recused herself, as posted here. Back to the opinion piece:
Hiatt Printing’s main office is on Wheeling north of Centennial, but a satellite office sits just off BSU’s campus on McKinley, exactly where the university envisions a $26 million hotel and immersive learning program for several majors related to travel, hospitality and food services among others.
Hiatt and family have declined to sell their property for $400,000, the last price Ball State offered. * * *
Given no sales agreement, university trustees authorized use of eminent domain condemnation through court, a controversial power government has to take property when needed to fulfill necessary government functions.
The process includes a court appointing a pair of appraisers to come up with a fair-market value for the property, which the government must pay. * * *
In large part, the hearing was for Circuit Court 1 Judge Marianne Vorhees to disclose to both sides — though nothing new to local counsel, such as Ball State’s attorneys Jim Williams and Scott Shockley of Defer-Voran — her connections to the university.
The issue Hiatt’s side wants to address is “whether the taking is legitimate or not, which is central to the case,” [Hiatt's attorney Phil] Sever told the court. The defendants feel building and operating a hotel isn’t part of the educational mission of the school.Yesterday, Feb. 28, 2013, the court held a hearing on Hiatt's objection. Here are copies of the hearing briefs:
Ball State disagrees.
Arguments will focus on state law written after a 2005 U.S. Supreme Court ruling allowed governments to take private property from one owner and convey it to another owner if subsequent development benefits the community.
In response, several states, including Indiana, wrote new laws to prevent government confiscation for non-government use. Ball State vs. Hiatt appears to be the first to test exactly what Indiana’s law means.
- Plaintiff Ball State's pre-hearing brief. Some quotes:
Defendants argue that I.C. 32-24-4.5 governs their objection On this point, Defendants are simply wrong. I.C. 32-24-4.5 does not apply to state educational institutions. The legislature has specifically exempted state educational institutions from the definition of "public agency" subject to this particular eminent domain legislation. See I.C. 32-24-4.5-5.
Assuming arguendo that I.C. 32-24-4.5 applies to Ball State, this section only applies when a "condemner [exercises eminent domain to acquire property] (1) from a private person, (2) with the intent of ultimately transferring ownership or control to another private person, and (3) for a use that is not a public use." (I.C. 32-24-4.5-1(b) (emphasis added)). This is not the case here for two separate and independent reasons.
First, Ball State does not have the intent of ultimately transferring ownership or control to another private person Ball State will control and own McKinley Commons. * * * Second, and perhaps most importantly, McKinley Commons is a public use in any event because it provides the public with the fundamental service of higher education. * * *
CONCLUSION. Ball State is authorized to exercise the power of eminent domain. Ball State's intended use of the property is a public use and for a public purpose. Defendants' assertions that Ball State intends to ultimately transfer ownership or control to another private person and that the intended use is not a public use are without merit. Defendants have wholly failed to raise an objection as to the paramount use of the facility. Instead, they attack the anticipated involvement of commercial tenants and a third property management company as fatal to a condemnation action. Defendants' arguments are misplaced and contrary to applicable law. Regardless, the commercial aspects of McKinley Commons will likewise serve a public use and purpose and further Ball State's educational mission of providing immnersive learning opportunities for students. Based on all of the foregoing, Defendants' objections should be overruled.
- Defendant Hiatt's hearing brief in support of objections to proceedings concludes:
As stated above, the legislative intent of the statutory provisions ofInd. Code § 32-24-4.5 was to limit the scope of what is considered to be public use and to curtail what entities could exercise the eminent domain powers when transferring ownership or control of real property between private persons. "Statutes of eminent domain are in derogation of common law rights of property and must be strictly followed, both as to the extent of the power and as to the manner of its exercise." City of Indianapolis. v. Schmid, 240 N.E.2d 66 at 67 (Ind. 1968). Ball State's unfettered right to condemn property as they saw fit is no longer the law of Indiana.
Upon analysis ofInd. Code § 32-24-4.5, Ball State does not have the right to take the Property through eminent domain. Ball State is a condemnor attempting to exercise the power of eminent domain to acquire a parcel of real property; (l) from a private person (the Trust); (2) with the intent of ultimately transfen-ing ownership or control to another private person (Commercial tenants and/or itself); and (3) for a use that is not a public use. Additionally, none of the conditions enumerated in Ind. Code § 32-24-4.5-7, which would make such a taking permissible, are present. Therefore, Ball State's condemnation of the Property is not lawful under Ind. Code § 32-24-4.5, et. seq. and should be summarily dismissed.
MUNCIE — A judge could rule this month on whether Ball State University can continue its efforts to claim a campus-area property through an eminent domain lawsuit.
The university last Sept. 27 filed the suit against David, Jane and Chris Hiatt, seeking ownership of the property that now is the location of the family’s business, Hiatt Printing, at 506 N. McKinley Ave.
Court documents reflect the university — which hopes to build a $25 million hotel and conference center, also to contain some student housing, at the site — offered $400,000 for the property.
BSU officials claim they rejected a counter-offer seeking $1.25 million for the land.
An attorney for the Hiatts, Tonny Storey of Carmel, has filed a motion to dismiss the lawsuit, contending that BSU does not have the legal standing to claim the property because its plans for the land do not constitute “public use.”
The Hiatts contend Ball State will “ultimately transfer control of all or part of the mixed-use structure to commercial tenants and a third-party management company.”
In a “pre-hearing brief” filed Thursday, BSU attorney Scott Shockley contended “Ball State will own and operate McKinley Commons and will not be transferring it to a private entity.”
Posted by Marcia Oddi on March 1, 2013 09:08 AM
Posted to Indiana Courts