Daily Development for Tuesday, November 26, 2002

 

By: Patrick A. Randolph, Jr.
Elmer F. Pierson Professor of
Law
UMKC School
of Law
Of Counsel: Blackwell Sanders Peper Martin
Kansas City,
Missouri
prandolph@cctr.umkc.edu

 

CONSTITUTIONAL LAW; DUE PROCESS; PROCEDURAL DUE PROCESS; NOTICE:    Due Process requires that a city give a mortgagee notice of its intent to demolish a building on the mortgaged property and opportunity to be heard on the issue.

 

Home Doc Corp. v. City of New York 746 N.Y.S.2d 42 (A.D. 2 Dept. 2002).

 

The plaintiff held a valid mortgage on certain real property and had commenced a foreclosure action in which it named and served the defendant City of New York as one of the defendants.  The plaintiff had also filed a notice of pendency.  During the foreclosure action and after the filing of the notice of pendency, the defendant demolished the premises without giving the plaintiff any notice of its intention to do so.

 

The court held that, since the City had notice of the foreclosure action and there was no showing that the building posed an immediate peril to the health and safety of the community at large, the City had violated the due process rights of the foreclosing mortgagee by demolishing the building without giving the mortgagee prior notice or opportunity to be heard.

 

Comment 1: In fact, the City of New York commendably confessed, either in briefs or oral argument that the court below erred when it granted the City's motion for summary judgment.  It is well established law these days that a mortgagee has a property interest, and that property interests must be protected by adequate notice.  The court states that the City "had notice" of the lender's interest, although it doesn't indicate whether the notice was actual or constructive.

 

Comment 2: For a case on the basic proposition that due process requires notice to owners of property prior to demolition and a hearing on the propriety of the demolition, even though the City argues that the demolition will serve critical health and safety concerns, see Catanzaro v. Weiden, 140 F.3d 91 (2d Cir. 1998) (The DIRT DD for 9/14/98).   For a little information about the standards to be applied, see Herrit v. Code Management Appeal Bd. of City of Butler,  704 A.2d 186 (Pa.Commw. 1997) (Although municipal codes generally enjoy a strong presumption of validity, a code provision requiring a building owner to demolish an unsafe structure if the costs of repair would exceed 100% of property's value violates Due Process and Equal Protection clauses of the Pennsylvania Constitution as well as the federal Constitution, since the ordinance is not rationally related to public health; there is no rational reason for city not to allow a building owner to abate a nuisance on his property) (part of the same DD).

Comment 3: If procedural delays hold up a city in carrying out a necessary demolition, is the City liable if the building causes injury to others?  See Continental Paper and Supply Co., Inc. v. City of Detroit, 545 N.W. 2d 657(Mich.1996.), the DIRT DD for 4/30/96, (City government is not liable under "nuisance-trespass" theory for fire damage caused by fire spreading from abandoned buildings as to which City has issued demolition order and has sought transfer of title from the State (which acquired it in a tax sale) if the City had not yet obtained formal legal title at time of fire - City was neither "owner" nor "operator.")

 

See also:  Village of Lake Villa v. Staokovich 2002 WL 31376071 --- N.E.2d ---(2002 WL 31376071 (Ill.App. 2 Dist. No. 2-00-0943) Oct. 21, 2002)).

 

The Illinois statute, 65 ILCS 5/11-31-1, authorizing demolition of property which is dangerous and hazardous is unconstitutional in that the statutory framework does not provide the owner with an opportunity to repair the property and therefore is an unlawful taking without due process.  The court wanted the legislature to provide a least restrictive means of protecting the public from unsafe buildings when a (new?) fundamental property right is infringed upon..

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