Appeal of Cheney, 87-137

• Decision Date: 08 July 1988
• Docket Number: No. 87-137,87-137
• Citation: 551 A.2d 164,130 N.H. 589
• Parties: Appeal of Debra A. CHENEY (New Hampshire Board of Tax and Land Appeals).
• Court: New Hampshire Supreme Court

Page 164

551 A.2d 164

130 N.H. 589

Appeal of Debra A. CHENEY (New Hampshire Board of Tax and Land Appeals).

No. 87-137.

Supreme Court of New Hampshire.

July 8, 1988.

Law Offices of James J. Kalled, Ossipee (John Pierce Kalled on the brief and orally), for plaintiff.

Sulloway, Hollis & Soden, Laconia (John P. Chandler on the brief and orally), for defendant, the City of Laconia.

SOUTER, Justice.

This appeal comes from the board of tax and land appeals, which overruled preliminary objections to a city's condemnation of commercial property to create a parking lot. The plaintiff claims that the board erred in rejecting her arguments that (a) the city's procedure deprived her of a constitutionally guaranteed opportunity to object prospectively to the proposal to take her property; that (b) a participating city councilor's conflict of interest rendered the condemnation action voidable; and that neither (c) a public purpose nor (d) a public benefit justifies the taking. We affirm.

In 1984 and 1985 the planning director and other appointed and elected officials of the City of Laconia studied a proposal from a group of local real estate developers and business leaders to redevelop the predominantly commercial area around the city's North Main and Pleasant Streets, the buildings of which then had a vacancy rate of about thirty-five percent. With the help of an outside consultant, the city planning department concluded that a significant cause of the neighborhood's sluggish economy was an insufficiency of parking spaces within a convenient distance of the area's business properties. The planning department's consultant concluded that a distance of more than four hundred feet from a parking space tends to discourage a store's potential customers, a standard of convenience that explained the area's disadvantage in competing with malls in Gilford and Belmont. The four-hundred-foot rule was used to explain why parking could be regarded as inadequate despite the admitted sufficiency of parking spaces within the city as a whole. There were, indeed, at least five parking lots within actual walking distance of the area in question, at least four of which were underused, and one of which was a parking garage with a virtually vacant third level. Each of these parking places, however, was literally or functionally four hundred feet or more from the proposed redevelopment zone, and the space available on the third floor of the garage was unpopular for the further reasons of its inadequate ramps and turning spaces and the perceived risks of vandalism and other petty crime associated with it.

The evidence of parking inadequacy was not unequivocal, however, for a survey conducted by the consultant showed that 71.4% of customers and patrons of businesses in the area usually could find parking near their destination. But neither the consultant nor the city planners regarded this statistic as dispositive, since it reflected the experience of existing customers of businesses in the underutilized district, and could not be taken to indicate that the same available parking space would suffice for the potential demand of a refurbished area occupied by merchants aspiring to compete effectively with the nearby malls.

The city planning department therefore concluded that any practical proposal to renew the area in question must include the creation of new parking spaces. After studying on-street, off-street and elevated parking plans, the department decided the city's best option would be to acquire six buildings, four of which would be razed to provide ninety-one off-street parking spaces, together with a site for installing underground structures to serve buried utility lines, and for planting trees and shrubs to relieve the expanse of asphalt pavement. This was the plan ultimately sent to the city council as one element of a proposal that included the developers' undertakings to invest in the refurbishment of the remaining commercial properties.

The proposal took the form of an application for a so-called Community Development Block Grant of federal funds to help finance the city's participation in the redevelopment project. On June 11, 1985, the council held a public hearing on the proposal and the funding request, at which affected property owners and the general public had an opportunity to express their opinions. The assemblage at the hearing included the plaintiff and her husband, the chief of the Laconia Police Department. The plaintiff's particular concern with the proposal stemmed from her interest in purchasing two of the buildings that would be condemned, which were then owned by one A.W. Sewell, who had used them for some forty years in his business of selling and repairing household appliances. For the four preceding years, the plaintiff had worked for Mr. Sewell, and she had become interested in buying the business and its premises on Mr. Sewell's imminent retirement.

At the close of the hearing, the city council approved the block grant application as requested, and authorized issuance of municipal bonds to raise one million dollars as a portion of the city's contribution to the project. The plaintiff claims that she never learned about the council's vote and was unaware of the city's commitment to the project until after she had taken title to the affected buildings on November 21, 1985.

On the morning after this transaction, the plaintiff received a formal notice of the city's proposal to take the newly acquired property and its offer to purchase it from her, and for some six months thereafter she and officials of the city corresponded back and forth about the purchase price. At length, there appeared to be little chance of agreement, and on June 10, 1986, the city's community development office petitioned the city council for condemnation of the plaintiff's two buildings. On June 30 the council held a hearing on the petition, at which the plaintiff appeared and spoke in opposition, following which the council voted to condemn the property. Finally, on August 8, 1986, the city filed its declaration of taking with the board of tax and land appeals. RSA 498-A:5.

The plaintiff then raised preliminary objections to the condemnation by challenging the validity of the condemnation procedure and the sufficiency of the city's justification for taking the property. The board provided a "hearing de novo on [those] questions of necessity and public use," noting that "federal aid highway funds are not involved." The present appeal is from the board's divided vote to overrule the plaintiff's objections, see RSA 71-B:12, and the issue of compensation has yet to be litigated, see RSA 498-A:24.

Under the familiar statutory standard governing appeals from administrative agencies, the board's findings of fact must be treated as prima facie reasonable. RSA 541:13. The administrative action must be affirmed unless it rests upon an error of law, or unless the plaintiff carries her burden to demonstrate "by a clear preponderance" that the board's resolution of an essential issue of fact was unreasonable. Id.

We perceive nothing illegal or unreasonable in the board's resolution of the first issue raised in this appeal. The plaintiff argues that the board failed to recognize the unconstitutionality of condemning her property, despite the city council's failure to give her notice of its intentions and an opportunity to be heard prior to its decision to take the buildings. She submits that the council reached that decision at its June 11, 1985 meeting, when it effectively adopted the proposal calling for the parking lot in question, and she claims that the hearing afforded her a year later, prior to commencing formal condemnation proceedings, thus came too late to satisfy the prior notice and hearing requirement.

This position is not without difficulties. The plaintiff bases her claim of right to a pre-decision hearing on Merrill v. City of Manchester, 124 N.H. 8, 466 A.2d 923 (1983) and Gazzola v. Clements, 120 N.H. 25, 411 A.2d 147 (1980), each of which rested on an equal protection analysis that the plaintiff has failed to develop in this case. We will assume arguendo, however, that such a hearing is required in this case, and we will likewise assume that any owner of property to be affected by this project was entitled to be heard prior to the council's June 11, 1985 decision to expend public funds on the redevelopment proposal. See Appeal of Portsmouth Trust Co., 120 N.H. 753, 758, 423 A.2d 603, 606 (1980) (due process protection requires hearing at a "meaningful" time).

Even with both of these assumptions in her favor, however, the plaintiff's claim for relief still runs afoul of two facts. First, she obtained what she now demands. She attended the June 1985 hearing and, so far as it appears from the record, she had just as free an opportunity as anyone else had to argue against adoption of the proposal. What more she could have asked for is not apparent to us, whether she might have asked in the name of equal protection or of due process.

Second, the plaintiff had no legal or equitable interest in the property at the time of the June 1985 council vote. She therefore had no constitutional or legal claim to any opportunity to protect a property interest that she did not have. See Appeal of Portsmouth Trust Co., supra at 756, 423 A.2d at 605 (protected interest is predicate of due process protection). The implication of the plaintiff's position is that whenever there is a sale of property subject to formally adopted governmental plans for public acquisition, the government may be forced to vacate its prior determination to proceed and start over again...