When Bait and Switch Meets Eminent Domain Abuse

It’s one of the oldest tricks in the book: the trickster lures the victim with a common understanding in order to reach an agreement and later breaches the terms of the deal as he intended to do all along. Only, by that time, the pieces have already fallen into place and it’s too late to argue.

City officials across the country have put a new spin on the well-worn bait-and-switch tactic. They’re taking private property by eminent domain under the pretext that it’ll be used for public use and then giving that property to private developers as they intended to do all along. The scheme is as unjust as it is effective—and that’s the problem.

In Los Angeles, Calif., the City seized three acres from a private furniture company to construct the new South Los Angeles animal shelter, something that falls within the legal and constitutional limitations of “public use.” City officials even bought the property and financed the shelter with money raised by a bond that voters approved to expand animal services.[1]

Enter Councilman Bernard C. Parks. Through his position in public office, Parks is now attempting to sell the condemned land to Cisco Bros., which, oddly enough, is a furniture design and manufacture firm.  Parks does this all under the rhetoric that “the original proposal impairs the growth of a major economic development.” This was a plan that the Los Angeles City Council initiated and a proposal that voters approved. Vaughan Benz, a successful furniture manufacturer whose warehouses were initially taken by the City, appealed Los Angeles’ condemnation efforts in court, and lost on the simple grounds that the taking undoubtedly constituted a public use because the animal shelter would be owned and operated by the public.[2]

So what’s going to happen with the shelter? It turns out that the City already owned property one block away and, based on the Council’s own concession, never actually needed to condemn the successful furniture manufacturer’s warehouse in the first place.[3]

If Los Angeles can legally seize private property for public use (which it did) and then change its mind and give it to a developer (which it’s doing), it’s a classic situation of eminent domain abuse—the transfer of property from one private individual to another.  In addition, it gets around California’s albeit minimal restrictions against eminent domain for economic development, since there was never even the suggestion or a finding that the existing property was “blighted.” Unlike typical eminent domain abuse disputes, though, property owners are not in a position to challenge the legality of the taking until after the fact, often after the home or business has already been destroyed and the damage is already done. And there’s the rub.

Defenders of eminent domain abuse often argue that the public and political processes are sufficient to protect home and business owners from illegitimate condemnation. While this is rarely ever the case, the political process is certainly insufficient when land is taken for a public use, then becomes a private use.

Situations similar to the Los Angeles incident have occurred elsewhere. The City of Hampton, Va., for example, condemned Frank and Dana Ottofaro’s property for a road, a legitimate public use. However, two months after the land was taken, the Development Authority entered into an agreement with a commercial developer handing over the condemned property for a shopping center.[4]

Whether or not the bait-and-switch tactic is intentional is secondary to the primary distinction: Can land be taken for public use and then justifiably handed over to a private developer if the plans change? This is an issue that state legislatures have begun to tackle with recent eminent domain reform legislation, and many lawmakers favor giving the previous landowner rights of first-refusal if the public-at-large no longer uses the property.

The Castle Coalition urges legislators to crack down on this form of eminent domain abuse—especially considering that landowners have very limited ground to contest the initial condemnation in courts of law. 

As Scott Vaughn, co-owner of the furniture-manufacturing firm said, “They told us it was for one thing when it was for another…. It was definitely an abuse.”[5]

[1] Patrick McGreevy, “Land seized for animal shelter may be sold to developer-donor,” Los Angeles Times, January 14, 2006, at A1; Patrick McGreevy, “U.S. targets L.A.’s seizure of property; A federal watchdog agency is scrutinizing the city’s condemnation of some businesses,” Los Angeles Times, June 14, 2006.

[2] Ibid.

[3] Ibid.

[4] See Ottofaro v. City of Hampton, 574 S.E.2d 235 (Va. 2003).

[5] Patrick McGreevy, “U.S. targets L.A.’s seizure of property; A federal watchdog agency is scrutinizing the city’s condemnation of some businesses,” Los Angeles Times, June 14, 2006.