Victory for Ohio Homeowners

October 1, 2006

October 2006

How IJ Won Unanimous Ohio Supreme Court Decision In Eminent Domain Abuse Case

By Chip Mellor

Resilience is a quality that’s easy to describe, but difficult to show.

Resilience is one characteristic that defines the team of attorneys and support staff we’ve assembled here at the Institute for Justice.

Merely one year after enduring a gut-wrenching legal setback with the Kelo case, the Institute for Justice not only spearheaded legislative reform limiting the use of eminent domain in 30 states, but also briefed, argued and ultimately won a tremendously difficult eminent domain case before the Ohio Supreme Court, setting the foundation for future legal victories at both the state and federal levels. The Ohio Supreme Court unanimously ruled that the City of Norwood could not take the homes of our clients to expand a shopping mall.

Here is why this victory was so important and what it means for the future.

The U.S. Supreme Court in Kelo noted that while the federal Constitution would no longer protect property owners from eminent domain for private gain, state courts and legislatures were free to provide higher levels of protection. Nevertheless, in the wake of Kelo, any state supreme court could take the easy way out and simply adopt the Kelo majority’s reasoning. As the first eminent domain case argued and decided by a state supreme court in the post-Kelo world, the Ohio Supreme Court’s decision would be the bellwether, setting the standard for other state supreme courts to protect or reject private property rights in the context of eminent domain.

IJ clients Carl and Joy Gamble (top) fought a principled fight and emerged victorious. Right, the City and the developer had marked the Gambles’ home for destruction.

“Although the judiciary and the legislature define the limits of state powers, such as eminent domain, the ultimate guardians of the people’s rights, as evidenced by the appellants in this case, are the people themselves.” —Ohio Supreme Court

The Ohio Supreme Court set the gold standard in this regard. In describing the importance of property rights in the American system of constitutional governance, the Court cited with approval Takings by Richard Epstein, works by Bernard Seigan and John Locke, natural rights, and the liberty-enhancing provisions of the Northwest Ordinance. Based on these, the Court expressly recognized the importance of court review of eminent domain, saying, “Inherent in many decisions affirming pronouncements that economic development alone is sufficient to satisfy the public-use clause is an artificial judicial deference to the state’s determination that there was sufficient public use.” The Court went on to reject “rote” deference and unequivocally struck down the use of eminent domain for economic development alone.

But even that was not enough to protect Ohio homes because the City of Norwood asserted the neighborhood in question was “blighted” and met the statutory definition of a “deteriorating area,” justifying the condemnation. So what did the City base this conclusion on? There was a “diversity of ownership” among the properties—essentially, each person owned his or her own home.

As IJ Senior Attorney Dana Berliner urged in her powerful closing argument to the Court, “As the members of this court drive home today, I ask you to think about which of the dozens of neighborhoods that you pass would not be ‘deteriorating’ under Norwood’s definition; which of them have no diversity of ownership, no older buildings, no cul-de-sacs, no driveways people have to back out of. Those neighborhoods are full of people like Carl and Joy Gamble, and unless this court rules in their favor today, all of these neighborhoods will be subject to condemnation for private development under Ohio’s Constitution.”

The Court took this to heart. It ruled the term “deteriorating area” was unconstitutionally vague as a justification for taking private property and was “a standardless standard.”

Throughout the case, we were constantly aware of just how much our clients stood to lose and how the entire process favored the government. As in so many states, once condemnation is exercised in Ohio, the property’s title immediately passes to the government. Existing buildings can be destroyed before the rightful owners can have their rights adjudicated by an appeals court. That is just what Norwood tried to do with the home of Joy and Carl Gamble (see next page). The City planned for demolition even as we urged first the trial court and then the court of appeals to stay the demolition pending the final resolution of the court case.

Both courts refused.

In what he called “the ultimate Hail Mary pass,” IJ Senior Attorney Bert Gall prepared an emergency appeal to the Ohio Supreme Court. With the demolition looming, and the doors of the home already spray painted with neon orange Xs marking it for destruction, the Gambles sadly packed up their belongings and moved into the finished basement of their daughter’s house in Louisville, Ky.

But within 22 days, in a moment that no Hollywood screenwriter could improve upon, we learned Bert had scored a touchdown.

Our conference room was packed with staff and clients who had just returned from the oral argument in the Kelo case. We were all experiencing a wave of exhilaration and exhaustion as we talked over lunch. Suddenly, IJ Vice President for Communications John Kramer burst into the room saying, “Bert, I have the Associated Press on the line and they want your comment on the Ohio Supreme Court’s decision to stay demolition of the Gambles’ house pending appeal.” Stunned silence quickly turned into whoops of joy as Bert, beaming with elation, hurried out to take the call. In its final opinion, the Ohio Supreme Court ruled that from now on, lower courts have the authority to stay demolitions as property owners assert their rights.

We call such experiences “IJ Moments” and this case was filled with them.

Another IJ Moment occurred during the trial, when IJ Senior Attorney Scott Bullock brought Joy Gamble to the witness stand. As Scott masterfully elicited her testimony about her home of 35 years and her desire to remain, the eyes of all but those with hardened hearts filled with tears. The human toll of eminent domain was never more dramatically articulated for all to understand.

We were up against a terrible recent U.S. Supreme Court precedent, difficult Ohio law, a powerful developer and his lawyers, tough politics and absolutely grueling deadlines. The fact that we prevailed with a unanimous decision is a tribute to the tireless work and resilience of many people at IJ. Indeed, at one time or another, almost everyone here contributed to the effort. In the end though, the final sentence of the Ohio Supreme Court opinion captured why this effort was so important. The court stated, “Although the judiciary and the legislature define the limits of state powers, such as eminent domain, the ultimate guardians of the people’s rights, as evidenced by the appellants in this case, are the people themselves.”

Armed with the legal and moral authority of the opinion from the Ohio Supreme Court, advocates at the Institute for Justice and across the nation are better armed than ever before to wage the fight against the tyranny of eminent domain abuse. It is a fight that we must win and will win.

Chip Mellor is IJ’s president and general counsel.

IJ clients and staff gather to celebrate the Ohio victory. They are, from left, IJ attorney Dave Roland, Carl and Joy Gamble, IJ supporter Bruce Hassel, IJ senior attorneys Bert Gall and Scott Bullock, IJ clients Nick Motz and Joe Horney, and IJ senior attorney Dana Berliner.

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