May 2014 Updates

The Arizona Supreme Court handed private property owners a victory in City of Phoenix v. Garretson:

“Consistent with our prior cases, we hold that a property owner is entitled to compensation if the government either completely eliminates or substantially impairs the owner’s access to an abutting road and thereby causes the property’s fair market value to decrease. As noted above, however, a landowner who claims or establishes only substantial impairment is not entitled to compensation unless the remaining access is unreasonably circuitous.”

— City of Phoenix v. Garretson, Arizona Supreme Court

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The Arizona Supreme Court

Arizona law is now crystal clear regarding the complete destruction of access. Before Garretson, lawyers for condemnors had argued that complete destruction of one access point was non-compensable if the property retained other, non-circuitous, and reasonable access to the road network. Garretson prevents condemning authorities from eliminating one point of access completely for a property to a certain road without paying for any devaluation that occurs to the property as a result. 

The facts of Garretson were first related in this space here. And, as suggested here, the Supreme Court essentially affirmed the Court of Appeals, albeit while substituting a Supreme Court opinion for the written opinion of the lower court.

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Government lawyers are never nice to anybody.

Attribution: http://xkcd.com/1332/ Under Creative Commons Attribution NonCommercial 2.5 License 

There are three great things about the ruling. First, superior courts, where trial of these cases occurs, now have a clear statement of the law upon which they can base their rulings.

Second, private property owners are entitled to compensation for access restrictions, which most people intuitively perceive as decreasing the value of real estate. (Whether or not this perception is true is sure to be hotly contested.)

Finally, private property owners now are able to bring into being the parade of horribles surely elucidated in the briefs the city and those aligned with the city submitted to the Supreme Court. The fear of the city and those aligned with it, expressed in those briefs, was surely that lawyers defending property owners would push to extend a favorable ruling to try to capture compensation for every destruction of access in a way that would threaten the very existence of a free society as we know it.

This is known as a "slippery slope" argument (see right), and the city and its minions were, to some extent, correct. For instance, I believe this ruling gives rise to a claim for just compensation when temporary complete destruction of access occurs during construction of improvements even if the access will be re-opened once construction is complete. Temporary complete destruction of access occurs frequently. 

Congratulations again to Dale Zeitlin on giving us a great case with which to go forward once more unto the breach. 

January 2014 Updates - Unpacking Arizona Supreme Court Discretionary Review

The Arizona Supreme Court has granted the petition to review the City of Phoenix v. Garretson decision of the Arizona Court of Appeals, Division One. Southern Arizona Public Works discussed the appellate decision here. The supreme court will hear oral argument in the case on January 22, 2014.

What does the supreme court's decision mean? In Arizona, civil litigants generally do not have an absolute right to supreme court review. The Supreme Court of Arizona may exercise its discretion to grant a petition for review, but does so infrequently in civil cases. In the court's 2012 fiscal year (July 1, 2012, through July 1, 2013), it received 313 civil petitions for review and granted only 12 petitions, or 3.8%.

The conclusion most lawyers draw from the discretionary nature of supreme court review and the court's limited exercise of it is the court grants petitions for review primarily when it wishes to correct an error at the appellate level, which would bode unwell for the Garretson decision and those who support the decision's reasoning and outcome. However, most lawyers would admit the supreme court sometimes grants review if it wishes to clarify the law by affirming the reasoning of the appellate court and elevating that reasoning into a supreme court opinion. 

How likely is it that the Arizona Supreme Court granted review in Garretson simply to affirm the court of appeals?

The answer is: unlikely, but more likely than you might think, depending on how you interpret the data. In the last 16 years, the Arizona Supreme Court has granted 247 petitions to review civil cases and has affirmed the appellate court only 36 times, or 14.5% of the time. Here is a breakdown:

Arizona Supreme Court Petition for Review Affirmances 1998-2013

However, during the four full years of Rebecca White Berch's term as Chief Justice, the court affirmed 30-40% of the civil cases the court elected to review. This graph demonstrates the trend:

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Arizona Supreme Court Petition for Review Results 1998-2013

The trend line demonstrates a change in attitude over time from the Zlaket court to the Berch court. The reasons for this trend are best left to (probably pointless -- but amusing) speculation, but there is a clear, data-based suggestion the current court looks more favorably upon elevating appellate decisions to become the law of the land. Further, the chances of affirmance in Garretson may be more likely than this analysis shows because this data does not account for partial affirmances. A case partially vacated with regards to, say an award of attorneys' fees, was not coded as "affirmed," even though the court may have affirmed the salient portion of the appellate court's analysis.

It is correct to say the supreme court's decision to grant the petition for review in Garretson is a victory for the petitioner. It would be incorrect to assume, however, the outcome in the supreme court is assured. Good luck to the lawyers arguing the case on January 22nd - Mr. Ayers for the City of Phoenix and Mr. Zeitlin for Garretson. But a little more luck to Mr. Zeitlin. 

Arizona Clarifies Just Compensation Owed in Eminent Domain When Owner Loses Driveway Access to Public Street

There is an update to this post here. 

In City of Phoenix v. Garretson, the Arizona Court of Appeals has clarified the law regarding the just compensation a condemnor must pay for restricting a property owner's access to an adjoining street as a result of taking a portion of the property through eminent domain.  

The decision discusses the long, tortuous route the Arizona courts have taken to finally arrive at a very simple rule:

“The government may not completely remove or substantially impair a property’s existing access to an abutting roadway without providing just compensation to the owner. ”

— City of Phoenix v. Garretson

The Garretson property is located in downtown Phoenix, and the City of Phoenix took a temporary construction easement along the north boundary of the property to construct the Phoenix METRO light rail. Garretson claimed that he was owed money because, in constructing the light rail, the City blocked Garretson's driveways onto East Jefferson Street. 

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The Garretson property in downtown Phoenix.

The City off Phoenix raised arguments that previous Arizona cases have suggested that a property owner is owed no money for loss of access unless the remaining access is unreasonably circuitous. Arizona has also suggested destroying such access is allowed pursuant to the City's police powers and therefore noncompensable. 

The Court of Appeals dispensed with the City's arguments, which is a victory for private property owners. Now there is no ambiguity in Arizona law regarding the circumstances in which a condemning authority must compensate a property owner for restricting access to a public street. Congratulations to Mr. Dale Zeitlin, of Zeitlin & Zeitlin, P.C., who represented Mr. Garretson.