The Law

A Razing Issue by Michael Blahy With businesses closing, and buildings vacated, responsibility for the security and upkeep still remain with the owner. Neglect can have consequences. Convent Corporation (“Convent”) owned a property on Highway 70 in North Little Rock, from which a gentlemen’s night club was operated. The club closed in August 2011, and the building remained vacant. In mid November, 2012, the structure was deemed a public nuisance and uninhabitable by a code-enforcement officer, Felicia McHenry (“McHenry”). The building was red tagged and notice was mailed to Convent. Convent had seven days to contact the city with its plans to correct the issues with the building. No response was received. With a search warrant, McHenry inspected the interior of the building. She and others met twice with Rich Livdahl, who claimed to represent Convent. They discussed requirements to bring the building up to code. On January 11, 2013, she reported to the Mayor and City Council that the “inspection revealed numerous violations and that the structure had also sustained some fire damage” and concluded “that the code enforcement department recommended that the structure be considered for condemnation”. On the agenda for the February 25, 2013 Council meeting, Convent was allotted three minutes to make its case against condemnation. Convent moved for a full hearing with no reply from the City. At the meeting, counsel for Convent mentioned that the owners were not aware of the damage, resulting from vandalism, until receiving the condemnation notice, and pleaded for a postponement of the vote, allowing “the owners to come up with a plan to rehabilitate the structure.” “The Mayor stated that Convent would have to negotiate with the City attorneys and code enforcement on a rehabilitation plan, as well as post a bond, but that any repairs would not have to be completed within thirty days of condemnation.” After some discussion, City Council voted in favour of a resolution indicating “that the structure was vacant, run down, dilapidated, unsafe, unsightly, dangerous, obnoxious, unsanitary, a fire hazard, a menace to abutting properties, and not fit for human habitation, and that because of such conditions, it was condemned as a public nuisance. Convent was directed to raze or otherwise abate the nuisance within thirty days; if this was not completed within ninety days, the resolution authorized the City to remove the structure and to fine Convent $50 for each day after ninety days that the nuisance was not abated”. On March 27, 2013, Convent brought suit in Pulaski County Circuit Court, against the City of North Little Rock, it’s mayor and members of council, members of the Code Enforcement Division, Director Tom Wadley, and Officer McHenry, each individually and in their official capacity (collectively, “the City”), appealing the condemnation and brought claims under Arkansas Civil Rights, trespass common law, and Arkansas and United States Constitutions. They claimed that the City’s condemnation ordinance is unconstitutional and requested the case be certified as a class action. The City removed the action to federal district court, and what followed was a return to the circuit court, motions for summary judgments, arguments of timeliness, appeals, and remands. On May 11, 2017, the circuit court entered an order finding that substantial evidence supported the City Council’s determination that Convent’s property was a nuisance and that the decision was not arbitrary and capricious. It found no reason to reconsider its previous dismissal of Plaintiff’s associated constitutional and class claims, and therefore, Plaintiff’s motion to reinstate claims is denied. The court postponed ruling on the City’s request for the $50 per day civil penalties. Convent’s request for a stay pending appeal was denied, unless a suitable bond, acceptable to the City was provided. The judgement didn’t stop Convent’s action, with further appeals and motions, and even a claim by the City that Convent did not own the property at time of filing, since they failed to pay property taxes for the years 2010 to 2013. Feeling entitled to a judgement, on June 26, 2019, the City filed a motion for summary judgment. Convent responded with a countermotion for summary judgment on July 17, 2019. Following a hearing on the cross-motions, the circuit court entered an order on December 11, 2019, granting the City’s motion for summary judgment and denying Convent’s countermotion. Convent filed an appeal of the last and previous rulings to the Arkansas Supreme Court on fifteen points, which were consolidated to: the City Council’s condemnation decision was not supported by substantial evidence and was arbitrary and capricious the circuit court erred by dismissing Convent’s constitutional claims, claims pursuant to 42 U.S.C. § 1983 and the Arkansas Civil Rights Act, and common‑law claim of trespass for failure to exhaust its administrative remedies the City’s condemnation procedure violates due process the City’s condemnation ordinances contain terms that are unconstitutionally vague and that provide public officials with too much discretion the City’s resolution condemning its property is an unlawful bill of attainder the circuit court erred by denying Convent’s renewed motion to strike the City’s amended answer and affirmative defenses The Supreme Court of Arkansas analysis and findings included: Convent’s arguments that the City’s condemnation decision was not supported by substantial evidence and was arbitrary and capricious were determined to be moot, as the structure has already been razed by the City and the City abandoned penalties associated with the condemnation order. A “decision by this court on Convent’s appeal from the administrative decision would have no practical legal effect”. “While it may have been appropriate for the circuit court to first rule on Convent’s administrative appeal before proceeding to the additional claims, the court denied without explanation Convent’s motion to reinstate these claims once the Rule 9 appeal had been decided. We therefore reverse and remand for further proceedings on Convent’s constitutional, civil‑rights, and trespass claims, with the exception of its facial challenge”. Justice Rhonda K. Wood dissented since Convent failed to properly include the claim in previous proceedings. Convent contended that the City’s condemnation ordinance violates due process because it fails to provide adequate notice, a meaningful hearing before an unbiased decision maker, or an opportunity to repair the property prior to seizure and condemnation of the property. After a definition of “due process” and a recital of the City’s procedures for condemnation of property, the Supreme Court found “The City’s ordinance provides for adequate notice prior to condemnation, as well as a public hearing . . . information on how to appeal a condemnation decision . . . does not expressly prohibit a precondemnation rehabilitation plan . . . [and] Convent’s brief assertions . . . are not supported by citation to convincing authority and are not persuasive. We therefore affirm the grant of summary judgment to the City on Convent’s facial due‑process claim”. The City’s ordinance contains phrases such as “unfit for human habitation”, “fit for human occupancy”, and “detrimental to the life, property, or safety of the public”. Convent claimed that this “vague language provides the City with too much discretion and that it invites arbitrary enforcement”. This claim wasn’t made originally, or during the proceedings but only at Convent’s motion for summary judgment. “We have held that it would be erroneous for a circuit court, on a motion for summary judgment, to consider any issues raised for the first time in a party’s briefs or exhibits”. The United States Constitution prohibits a state to pass any “Bill of Attainder”, a statute that applies either to named individuals or to easily ascertainable members of a group in such a way as to inflict punishment on them without a judicial trial. Convent claimed that the resolution passed by the City is an unconstitutional bill of attainder. The City contends that the resolution was not a legislative act but an administrative one. The Supreme court agreed saying “[t]he circuit court did not err by granting summary judgment to the City on this claim”. During the process of this case, the case was removed to the federal district court and then remanded to the circuit court in February 2014. The City filed timely replies to the federal court. In May 2014 Convent filed a motion for judgment on the pleadings or for summary judgment with the circuit court. The City responded to the motion and attached its document filed with the federal court. In June 2014, the City filed an amended answer. Convent filed multiple motions to strike the City’s answers as untimely. The circuit court denied the motions. The Supreme court ruled “[e]ven assuming that Convent is correct that the City was still required to file an answer within thirty days of notice of remand from federal court, it was within the circuit court’s discretion to grant the motion to strike.  . . . Convent has not demonstrated an abuse of discretion by the circuit court . . . We therefore affirm on this point as well”. (Convent Corp. v. City of North Little Rock (Supreme Court of Arkansas, Docket No. CV-20-216)) Decision: January 2021 Published: January 2021 Feature Articles If you have an opinion on the retailing or retail real estate industries, take this opportunity to share your thoughts. Articles should run between 400 and 800 words. Topics can, be general in nature, consumer observation or specific to retail concepts or practices. Articles will be posted for at least one week and will then be placed in the Editorial Archives. All articles submitted will be read and considered but we cannot guarantee publication. Each published article will carry the submitters byline (if desired) and is a free service to our community. Article ideas and suggestions are also always welcomed. Contact PVS@PlainVanillaShell.com