Latest 8 Cases This Week: Mann v. United States (4th Cir.), CHKRS, LLC v. City of Dublin, Ohio (6th Cir.), Nagel v. Westen (Cal. Ct. App.)

One More for the Road: Why Congress Must Impeach Donald Trump (Again)

DEAN FALVY

Dean Falvy, a lecturer at the University of Washington School of Law in Seattle, makes the case for impeaching Donald Trump again, after the failed insurrection of January 6. Falvy describes three possible ways to disempower Trump from undermining democracy in our nation and explains why immediate impeachment by the House and removal by the Senate is the most appropriate course of action.

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Mann v. United States

Court: US Court of Appeals for the Fourth Circuit

Docket: 19-1793

Opinion Date: January 6, 2021

Judge: Niemeyer

Areas of Law: Real Estate & Property Law, Tax Law

The Fourth Circuit affirmed the district court's judgment affirming the IRS's disallowance of a charitable deduction that plaintiffs claimed on their 2011 joint income tax return. After plaintiffs purchased real property, they donated the existing house on the underlying land so that they could build a new one in its place. However, the charity ended up disassembling some of the house, salvaging useful components, and leaving the remainder for demolition by plaintiffs' contractor. Plaintiffs took a charitable deduction of $675,000 on their income tax return, representing the appraised value of the house as if it were moved intact to another lot. The IRS disallowed the deduction under 26 U.S.C. 170(f)(3). Plaintiffs paid the additional taxes assessed by the IRS and filed suit against the United States, seeking a refund of approximately $213,000. The court concluded that defendants donated their entire interest in the house and that they supported their donation with a "qualified appraisal" of the contributed property. In this case, the house was never recorded in the public land records, Plaintiff Linda Mann always retained record ownership of the house. Furthermore, even if the court were to accept that the donation agreement both "constructively severed" the house from the land and conveyed contractual ownership of the house to the charity, Linda still remained the record owner of the house responsible for real-estate taxes. The court also concluded that, even setting aside the consequence of Linda's continuing as the house's record owner, both the donation agreement considered as a whole and the substance of the transaction demonstrate that Linda failed to transfer her entire interest in the house to the charity. The court explained that Linda maintained the benefits and burdens of ownership of the remaining components which she ultimately paid her contractor to demolish. Therefore, she did not donate, as personal property, her entire interest in the house to the charity, making plaintiffs' attempt to claim the value of the entire house as a charitable deduction improper. Finally, the court concluded that the $313,353 appraisal used to claim the deduction was not a qualified appraisal of the contributed property under 26 U.S.C. 170(f)(11)(C).

CHKRS, LLC v. City of Dublin, Ohio

Court: US Court of Appeals for the Sixth Circuit

Docket: 20-3435

Opinion Date: January 4, 2021

Judge: Murphy

Areas of Law: Civil Procedure, Real Estate & Property Law, Zoning, Planning & Land Use

CHKRS leased Friedman’s property and paid $8,500 for an option to purchase by giving 30 days’ notice. With respect to eminent-domain, the lease stated that any money from the City of Dublin was payable to Friedman “until [CHKRS] has procured on the purchase option.” Dublin was constructing a roundabout near the property. Weeks later, Dublin notified the residents that workers would be entering to construct a bike path through the leased property. Dublin initiated a “quick-take” action, adding CHKRS to the suit, and deposited $25,080. with the court. CHKRS emailed Friedman, indicating that CHKRS intended to buy the property. Ohio courts ruled that the email did not “procure” the purchase option and that Friedman was entitled to Dublin’s funds. Dublin began construction. CHKRS sued, citing the driveway's removal. In 2016, the city constructed a new driveway, which CHKRS asserts suffers from design flaws, violates building and traffic codes, creates a hazard, and limits access. CHKRS completed its purchase of the property. CHKRS filed federal litigation, asserting takings and due-process claims, seeking payment for the defective replacement driveway. CHKRS disavowed any attempt to again seek payment for the appropriation of the bike-path easements. The court held that CHKRS lacked Article III standing, reasoning that the state courts had already held that CHKRS lacked a protectable interest in the property. The Sixth Circuit reversed. Article III standing was not the correct doctrine. CHKRS established its standing by alleging a colorable interest in the property for its takings claim. The district court misread Ohio issue-preclusion law in reaching the contrary result. The court affirmed the dismissal of CHKRS’s due-process claims as forfeited.

Nagel v. Westen

Court: California Courts of Appeal

Docket: B300552(Second Appellate District)

Opinion Date: January 7, 2021

Judge: Steven Z. Perren

Areas of Law: Real Estate & Property Law

In the underlying action, plaintiffs filed suit against sellers after the house plaintiffs bought from sellers was uninhabitable based on extensive water intrusion. The arbitrator found that sellers had failed to disclose material facts regarding the water damage; found that the house was worthless and its only value was the land; and awarded plaintiffs over $4.5 million for the loss of the home, the futile efforts to repair it, plus attorney fees and costs. This appeal is from the subsequent lawsuit filed by plaintiffs to unwind sellers' transfers of their assets under the Uniform Voidable Transactions Act (UVTA). The action was dismissed because plaintiffs could not identify a "third party transferee" who received sellers' assets. The Court of Appeal reversed the trial court's order to the extent it dismissed plaintiffs' causes of action for statutory fraudulent transfer and the companion claims for conspiracy and aiding and abetting. The court concluded that plaintiff stated a cause of action for fraudulent transfer under the plain language of the UVTA, and that limiting the UVTA to third-party transfers would neither conform to legislative intent nor serve the public's interest. The court affirmed the order's dismissal of plaintiff's common law cause of action for fraudulent transfer.

Page v. Deutsche Bank Trust Company Americas

Court: Florida Supreme Court

Docket: SC19-1137

Opinion Date: December 31, 2020

Judge: Charles T. Canady

Areas of Law: Banking, Real Estate & Property Law

The Supreme Court concluded that a unilateral attorney's fee provision in a note and mortgage was made reciprocal to a borrower under Fla. Stat. 57.105(7) where the borrower prevailed in a foreclosure action in which the plaintiff bank established standing to enforce the note and mortgage at the time of trial but not at the time suit was filed, holding that the statutory conditions were met. The Fourth District Court of Appeal held that a borrower who successfully argues that the bank lacked standing at the time suit was filed could not rely on the contract to obtain attorney's fees under section 57.105(7). The Supreme Court reversed, holding that the borrowers were eligible to recover reciprocal fees under the statute because the conditions in the statute's two clauses were satisfied here.

State v. Sanschagrin

Court: Minnesota Supreme Court

Dockets: A19-1700, A19-1701, A19-1702, A19-1703

Opinion Date: December 30, 2020

Judge: Hudson

Areas of Law: Real Estate & Property Law, Zoning, Planning & Land Use

The Supreme Court held that a letter contesting a notice of zoning violation was not a "request" as defined by Minn. Stat. 15.99, subd. (1)(c) and therefore did not entitle respondent property owners to the benefit of the automatic approval provision in Minn. Stat. 15.99, subd. (2)(a). The automatic approval provision requires agencies to, within sixty days, approve or deny a written zoning request. Failure to deny such a request within sixty days is deemed an approval of the request. Respondents received notice of a zoning violation from the City of Shorewood after installing a dock and contested the zoning violation in a written letter to the city planning commission. The City did not respond. Thereafter, Respondents were charged by criminal complaint with two misdemeanor violations of the city code. The district court granted Respondents' pretrial motion to dismiss, concluding that Respondents' letter was a "request" under Minn. Stat. 15.99, subd. 1(c), and therefore, Respondents' request for zoning action was automatically approved by operation of law. The Supreme Court reversed, holding that the letter was not a "request" under the statute.

Dolezal-Soukup v. Dodge County Board of Adjustment

Court: Nebraska Supreme Court

Citation: 308 Neb. 63

Opinion Date: December 31, 2020

Judge: Funke

Areas of Law: Government & Administrative Law, Real Estate & Property Law, Zoning, Planning & Land Use

The Supreme Court affirmed the order of the district court approving the Dodge County Board of Adjustment's grant of variance for a 4-H pigpen built in violation of county setback requirements, holding that competent evidence supported the district court's factual findings and that the district court did not err or abuse its discretion in approving the variance. The variance was based on, within the meaning of Neb. Rev. Stat. 23-168.03(1)(c), peculiar and exceptional practical difficulties or exceptional and undue hardships. In affirming the Board's decision to grant a variance, the district court found that the Board's decision was reasonable, well considered, and within the Board's discretion. The Supreme Court affirmed, holding that the district court did not make an error of law or abuse its discretion in determining that the narrowness or shape of the property resulted in sufficient hardship to justify upholding the Board's decision to grant the variance.

Egan v. County of Lancaster

Court: Nebraska Supreme Court

Citation: 308 Neb. 48

Opinion Date: December 31, 2020

Judge: Papik

Areas of Law: Government & Administrative Law, Personal Injury, Real Estate & Property Law, Zoning, Planning & Land Use

The Supreme Court affirmed the decision of the district court finding that E. Jane Egan lacked standing to challenge the Lancaster County Board of Commissioners' issuance of a special use permit allowing Randy Essink to construct and operate a poultry production facility on land within the county's agricultural zoning district and that the permit was appropriately issued, holding that the district court did not err. Egan and Janis Howlett challenged the Board's decision in the district court, asserting that the proposed poultry production facility would lead to adverse effects on the environment, properly values, public health, and local infrastructure. The district court affirmed the issuance of the special use permit, concluding that Egan did not have standing and that the permit was appropriately issued. The Supreme Court affirmed, holding that the district court did not err by failing to find that Egan had standing and finding that the special use permit was properly approved.

Saticoy Bay, LLC Series 133 McLaren v. Green Tree Servicing LLC

Court: Supreme Court of Nevada

Citation: 136 Nev. Adv. Op. No. 85

Opinion Date: December 31, 2020

Judge: Stiglich

Areas of Law: Real Estate & Property Law

The Supreme Court affirmed the judgment of the district court entering judgment for Green Tree Servicing, LLC in this action to quiet title brought after a homeowners' association (HOA) lien foreclosure sale upon finding that the first deed of trust had not been extinguished because there had been a valid tender, holding that Saticoy Bay LLC Series 133 McLaren took title subject to Green Tree's first deed of trust. Green Tree was assigned a deed of trust on certain property. The original homeowners because delinquent on their HOA assessments, and the HOA proceeded with a foreclosure sale. The property was sold to Saticoy Bay. Saticoy Bay brought an action to quiet title, and Green Tree counterclaimed for the same. The district court granted summary judgment for Green Tree. On appeal, Saticoy Bay argued that the district court erred in granting equitable relief because the recitals in the foreclosure deed proved that the superpriority portion of the HOA's lien was in default at the time of the sale. The Supreme Court affirmed, holding (1) conclusive recitals of default in a foreclosure deed do not prevent a valid pre-sale tender from preserving a deed of trust; and (2) the valid tender by Green Tree's predecessor preserved the original deed of trust.