Public Use or Purpose, Necessity, and Pretextual Takings in Colorado Eminent Domain Law
| Publication year | 2022 |
| Pages | 44 |
REAL ESTATE LAW
JODY HARPER ALDERMAN
This article discusses the public use or purpose and necessity elements in eminent domain proceedings. It also covers the related issue of pretextual takings.
Entities with eminent domain power must satisfy four preconditions before initiating a condemnation action: (1) the condemnor must have authority to condemn the property for the stated purpose; (2) the acquisition must be for a public use or purpose; (3) the property must be necessary for the stated purpose; and (4) the parties must have failed to agree on the compensation amount.[1] This article compares the closely related public use or purpose and necessity elements in the context of acquiring private property for public projects.
What is a Public Use or Purpose?
"Public use" and "public purpose" are sometimes used interchangeably in eminent domain law. The term "public use" comes from the state constitution and is incorporated into eminent domain statutes. Colorado case law adopted the "public purpose" test to determine whether a taking is for a "public use." This article uses these terms accordingly: "public use" when referencing, for example, the state constitution; and "public purpose" when referencing, for example, cases discussing the public purpose test.
The right to take private property for a public use is derived from Colo. Const, art. II, § 15, which provides in relevant part: "whenever an attempt is made to take private property for a use alleged to be public, the question whether the contemplated use be really public shall be a judicial question, and determined as such without regard to any legislative assertion that the use is public."[2] Thus, the court must decide whether a contemplated use is a public use.[3] In most cases, condemnors must prove by a preponderance of the evidence that a particular use is public.[4] However, the burden of proof is greater in the urban renewal context, where the condemnor must prove by clear and convincing evidence that the use is public.[5]Unlike the determination of necessity, the court does not defer to the condemnor's determination that a use is public.[6]
The Public Purpose Test
There is no precise definition of "public use,"[7] which has been characterized as "inherently amorphous" and "flexible."[8] Courts may consider several factors, including (1) the country's physical conditions, (2) the community's needs, (3) the character of the benefit the project may confer upon a locality, and (4) the needs for such improvement in the development of the state's resources.[9] These factors have been described as "guidelines" to assist a court in assessing whether a taking is essentially for a public benefit, but these factors are not exhaustive or exclusive.[10] Thus, courts must determine whether a contemplated use is a public use on a case-by-case basis. This opens the door to challenges in many condemnation cases.
"Public use" means that the taking serves a public purpose or benefit but doesn't necessarily mean the public must use the property being taken.[11] In Colorado, courts apply the public purpose test[12] to determine whether the project's overall objective confers a public benefit.[13] If a project is essentially for a public benefit and advantage, a court will find a public use.[14] "Essentially for a public benefit and advantage" means that the "fundamental and intrinsic nature of the taking must be for public benefit."[15] Private parties may benefit (even significantly) from the project or property acquisition, so long as the purpose and benefit are essentially public.[16] Conversely, if the primary purpose of the condemnation is to advance private interests, the existence of an incidental public benefit does not prevent a court from finding it does not meet the public purpose test.[17]
Applying the Public Purpose Test
Colorado courts have liberally construed public use or purpose. In an early case, a landowner argued that a railroad company's condemnation for construction of dust levees parallel to its tracks was not a public use.[18] The Colorado Supreme Court rejected that argument, finding that the railroad served the public and the dust levees benefited the railroad, thus serving a public purpose.[19] In another case involving the Public Service Company of Colorado, landowners argued that an easement condemnation for construction of a power line to exclusively serve the Adolph Coors Company was not a public use.[20] The Colorado Supreme Court recognized the "difficulty of formulating a definition of public use which is applicable to the myriad of circumstances which can arise in an eminent domain case."[21] It determined that the public had the right to use the power transmitted by the line on equal terms with Coors and accordingly held the use was public. Only a handful of Colorado appellate courts have determined that the use contemplated by the condemning authority lacked a public purpose. In the first, Denver West Metropolitan District v. Geudner, the Denver West Metropolitan District (DWMD) sought to condemn property to relocate a drainage ditch[22] DWMD's entire board of directors comprised members of the same family that owned a company with commercial property under contract to sell to a third party. As a condition of the sale, the purchaser required relocation of the ditch so it did not traverse the sale property. DWMD hired an engineering firm to study alternative routes for the ditch, and it proposed three routes, but all crossed the property. DWMD rejected the proposed routes and directed the engineering firm to find a route that did not cross the sale property. A fourth proposed alternative would cross another landowner's property, and DWMD pursued condemnation of that property for the route. Under those facts, a Court of Appeals division found that the public purpose was only incidental to the condemnation's overriding private purpose, which was to "conclud[e] a commercial transaction" that would "advance the private interests of the District's officers."[23]
Inthe second case, Silver Dollar Metropolitan District v. Goltra, the Silver Dollar Metropolitan District (SDMD) sought to acquire property in fee to construct, operate, and maintain a roadway and tunnels.[24] The tunnel project was one of five possible alternative routes under evaluation by federal and state agencies at that time, and no preferred alternative had been selected. Nevertheless, SDMD contended it needed the property to conduct core drilling and obtain geotechnical information to complete the design of the tunnel portals and other structures. The trial court dismissed the petition, finding no public use for the property and that SDMD would be acting in bad faith by proceeding with the condemnation at that time. A Court of Appeals division affirmed, concluding that "whether there would ever be a project for which the property could be lawfully condemned" was germane to the determination of public purpose.[25] Thus, the condemnation was premature—the tunnel project would have to be selected as a preferred alternative before SDMD...
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