Friday, August 14, 2015
Kornfeld on Israeli land policies and the Bedouins
Initially, I’d like to thank Stephen Miller and Jessie Owley for the privilege of allowing me to be a guest blogger. I hope that my posts will be both informative and thought provoking.
Thanks, Itzchak Kornfeld
In this, my first post, I will address a real property issue that is pitting the Government of Israel against its Bedouin minority.
280,000 Bedouin live in Israel. Of these, 90,000 live in the Negev Desert in the country’s south. See Map Below. This community lives in the general area of Be’er Sheba, which we in Israel consider the capital of the Negev. The government is seeking to evict the Negev Bedouin from their ancestral lands. Its reason: the State of Israel considers them to be living in unauthorized villages or locations and accordingly sees them as squatters. I will address why the government has taken on this position in a subsequent post. Today I will introduce the history of the Bedouin and an initial discussion of the Land Law of 1949.
- Full disclosure, I work and have worked with the Bedouin and against the government.
The Negev (or Southern) Desert, Israel
TheZin Wilderness in the Middle Negev, Israel
Juniper Tree in the Negev adjacent to the Large Crater (of Makhtesh HaGadol in Hebrew)
One fact that is likely well known but may not be fully acknowledged is that Europeans, in almost every venue that they’ve settled, e.g., the U.S. and Canada, have taken by force lands that belonged to indigenous populations. Indeed, examples abound across the face of the planet, e.g., American Indians, the First Nations of Canada, the Bedouin of the Middle East, the Berbers of North Africa’s Maghreb, and the Walmatjarra of Australia, among others. Prior to being dispossessed and placed on reservations of one sort or another, these peoples flourished and were one with nature.
Of course, being one with nature is not one of the virtues of most European colonialists and their progeny. They conquer, reclaim and put land to “beneficial uses”. In this vein, private property rights theorists would argue that the bundle of rights, regardless of whether the land was appropriated by force, must be seen as a feature of an economic good. This economic paradigm requires use of the land; income generation from the land; the right to transfer the asset; and the right to enforce their property rights. But, how are aboriginal peoples supposed to gain the bundle of rights if they are dispossessed from their ancestral lands? This situation of course sets up a conflict between the two sides.
Indeed, the Bedouins in the Negev are in conflict with the European-based government of Israel. First, who are the Bedouin? They are an Arabic speaking seminomadic group that is descended from nomads who for at least thousand years inhabited the deserts of the Middle East, mainly from Syria in the north to North Africa in the south, and for our purposes, resided in Israel pre -1948, the date of the State’s founding.
The Bedouin also continue to reside within the boundaries of the State of Israel, and unlike the Palestinian or Arabs who also live in Israel proper the Bedouin serve in Israel’s military (the “IDF”). Service in the military is very important for Jewish Israelis however, the Bedouin do not receive the benefits that Jewish soldiers receive upon being released from their term of service.
Bedouin Man wearing IDF Jacket
How the Bedouin Live Today, when Not Afforded Government Services
Notably, the Bedouin have been fighting for the right to the lands that they and their ancestors occupied since the founding of the State of Israel. Moreover, they cannot undertake their semi-nomadic lifestyle since the borders of Egypt, Jordan, Lebanon and Syria are closed to them as a consequence of their Israeli citizenship. The Negev Bedouin have thus been forced to give up their thousand year legacy of being nomads.
Israel’s Land Policies
Since its founding in 1948, the Israeli government has held title to all but 7 percent of land within the country’s borders. The latter is held by deed, generally predating the formation of the Government of Israel. The government’s real property interests are transferred to it from the independent Jewish National Fund (“JNF”). The JNF was established in Basel, Switzerland, in 1901, solely to purchase land from Arabs, the Ottoman Turks, Jews, and other land holders, within the bounds of what today is Israel.
In enacting the Israel Land Law of 1969, as amended, the Knesset (Parliament) sought to eliminate the majority of the Ottoman Turkish law of 1274. That, in fact, did not occur. However, Knesset members thought long and hard about the adoption of the British common law property system, if for no other reason, because it was extant and had been working for some 30 years. Moreover, Hebraic or Jewish property law, as enunciated in the Bible and the Talmud, was also engrafted onto the 1969 law. Thus today, real property law in Israel is a combination of the three. That legal sausage is now the law of the land.
A Twist in the Law
A personal story may be of interest: In 1937, my father’s aunt purchased a parcel of property in Ramat HaSharon, an upper income city, north of Tel Aviv, where today most of the IDF’s generals reside. She was one of 18 parcel holders. When Aunt Sara passed away my father inherited the plot, and subsequent to his death, I inherited it. The other owners and I sought to develop all 18 parcels (4.5 acres), however, we cannot due to an artifact of Ottoman law. That legal relic states that if A is growing any fruits or vegetable on B’s land, as a lessee, the lease cannot be terminated by B until A decides not to grow crops. In our situation, my father’s aunt Sara purchased the property following A’s agricultural undertaking. He grew tomatoes, and his heirs continue to do so. Thus, three generations of my family are legally bound not to evict the farmers from our land. One bright spot is that we as owners we do not have to pay real estate taxes, s long as the property remains agricultural.
August 14, 2015 in Community Design, Comparative Land Use, Environmental Justice, Property Theory, Real Estate Transactions, Redevelopment | Permalink | Comments (2)
Monday, January 12, 2015
West Virginia University's Land Use and Sustainable Development Law Clinic
The Land Use and Sustainable Development (LUSD) Law Clinic at West Virginia University's College of Law has been at full strength for a little over two years. One of only a handful of land use law clinics in the country, the LUSD Clinic staff includes five attorneys (one of whom is an AICP land use planner), and an additional AICP land use planner. We are also fortunate to have our first LLM Fellow this year, Ann Eisenberg, a Cornell Law School graduate. West Virginia University College of Law established a LLM degree program in Energy and Sustainable Development Law in the Fall of 2014. The LUSD Law Clinic class includes 6-12 J.D. students each year, and the students work with the staff and clients across the state.
Three main areas form of the focus of the clinic. The clinic director, Katherine Garvey, formerly with the Environmental Law Clinic at Vermont Law School, heads up the wastewater portion of the clinic. Nathan Fetty, the Managing Attorney, and Jason Walls, Land Conservation Attorney, spearhead the land conservation work conducted by the clinic. Last, and certainly not least, Jared Anderson, J.D., AICP, Supporting Land Use Attorney, Christy DeMuth, AICP, and I, as the Lead Land Use Attorney, guide the land use law activities of the clinic. The land use mission of the clinic includes, in addition to representing local governments across the state, education of local land use leaders in West Virginia. Although this education takes many forms, the clinic's Mountain State Land Use Academy holds two major educational workshops each semester. Although the clinic staff includes these three teams, the clinic as a whole operates as one team, working together to address these interrelated issues.
The clinic was established, in part, to aid in putting West Virginia on equal footing with surrounding states in terms of the land use and land conservation issues. West Virginia has lacked such a resource for a very long time. The LUSD Law Clinic seeks to remedy that long-standing lack of resources and has already helped many communities in the state make incredible progress.
During the 2013-2014 academic year, the clinic worked with with 18 local government clients, helping develop comprehensive plans and zoning ordinances, and facilitating over 50 public meetings. For example, the City of Wellsburg successfully adopted a comprehensive plan written by Clinic planners, attorneys and students. The next step is for the LUSD Law Clinic to assist the Wellsburg Urban Redevelopment Authority with redevelopment plans for identified slum and blighted areas in the community.
In the area of land conservation, the LUSD Law Clinic worked with non-profits and government agencies on land transactions aimed at protecting over 25 different properties. For example, the Clinic helped permanently protect 665 acres of land which fronts six miles of the Gauley River. Working in five counties, legal services included title examinations, contract drafting, drafting of title opinions and negotiations.
In partnership with the Northern Brownfields Assistance Center, the LUSD Law Clinic started a program to provide legal resources to local governments to address abandoned and neglected properties. The Clinic interviewed stakeholders such as building inspectors and municipal attorneys throughout the state to identify local concerns. A future blog post will provide more information on this exciting and transformative initiative.
I look forward to continuing to work with my wonderful colleagues, professionals across the country and the wonderful citizens of the great state of West Virginia for many years to come. West Virginia is a beautiful state with a committed and dedicated citizenry. I am very priviledged indeed to have the opportunity to work here.
January 12, 2015 in Local Government, Real Estate Transactions, Redevelopment, Zoning | Permalink | Comments (0)
Monday, August 11, 2014
Posting from New Orleans (No. 2) -- Reviving Inner-City Neighborhoods: the Challenges of Teaching and Doing Urban Revitalization Work
This is the second in a series of posts from New Orleans. The first appeared last Monday, August 4th. As I promised in that first piece, today we’re just beginning to take a walk down one of New Orleans’ historic commercial corridors, Oretha Castle Haley Boulevard (O.C. Haley Blvd.), which is named after a leading local civil rights activist. Today’s post looks at the fortuitous intersection between post-Katrina federally-funded long-term recovery programs and the extensive pre-storm efforts of O.C. Haley Boulevard activists and stakeholders to reclaim this historic corridor.
Photo (2014): O.C. Haley Boulevard looking northwest toward the Central Business District (CBD)
In the decades leading up to the 1960s, O.C. Haley Boulevard (formerly known as Dryades Street) was one of the principal shopping destinations for black families and also a pre-Civil Rights Era hub for the City’s best black musicians. During the 50 years since the mid-1960s, O.C. Haley withered a little more each passing year. First, the corridor lost in increasing numbers its shoppers; then its businesses began to close; and then families in surrounding blocks began to move away. Finally, in the years leading up to Hurricane Katrina, the Boulevard started losing its architecturally distinguished commercial structures – one by one.
Photo (2008): Fire destroys the interior of another of the Boulevard's important historic structures, the circa 1902 Myrtle Banks School.
Earlier this spring, in his CityLab article, The Overwhelming Persistence of Neighborhood Poverty, Richard Florida tacitly suggests that O.C. Haley’s fate has been the fate of our oldest urban neighborhoods all across the country. Florida’s article, citing a May 2014 study by Joseph Cortright and Dillon Mahmoudi, disclosed a number of fascinating tidbits about cities, but the statistic that really jumped out is this one: since 1970 “for every single gentrified [urban] neighborhood, 12 once-stable neighborhoods have slipped into concentrated disadvantage.”
That statistic about declining inner city neighborhoods stopped me in my tracks. As long as I can remember, I’ve been fascinated by two things: old inner city neighborhoods (my dad is a preservation architect) and the Red Sox (born and raised in Boston). This is to say that I'm easily captivated by box score style statistics, such as the one Florida cites. I'm also no stranger to extended periods of adversity for the teams I love. But I clearly did not have an accurate idea of the extent to which so many inner city neighborhoods had faced such long odds for so long a period of time.
The statistic Florida cites concerning the decline of inner city neighborhoods got me to thinking about what I taught my land use students last semester. If our land use, local government, real estate finance, and community and economic development clinic students aim to work in cities, Richard Florida is telling us that they have their work cut out for them. The data suggests there are many hundreds of O.C. Haley-like Boulevards across the country.
Of course the problem of distressed inner city communities is not new. As we all know, lawyers have for years played critical roles in representing community groups, developers, banks, philanthropic funders, and local government clients on every side of urban revitalization deals. But Florida’s article reminded me how large the challenge of neighborhood revitalization looms for cities. There’s a lot of ground to cover in a basic land use class, but I found myself asking what my students and I learned this past semester that would help them do this work better or smarter. The short answer is that we squeezed in as much time as we could to study the redevelopment ‘tool box’ a city and its neighborhood organizations can use to stabilize and revitalize neighborhoods: land trusts, land banks, eminent domain, code lien enforcement, tax credits, etc. But thinking about Florida’s article reminded me that this approach is missing a key element. After all, most of these stabilization and revitalization tools were available to young lawyers and planners and community groups for the better part of the 45-year period that Florida observes the rapid evaporation of inner-city neighborhood vitality.
In thinking about the statistics Florida discusses and about the long decline of O.C. Haley Boulevard, it struck me that the conversation that I didn’t have this spring with the land use students is about the nature of urban revitalization work. It is often a slog. Some describe the work as being as slow and painfully incremental as ‘trench warfare.’ I prefer how some describe it as caring for a patient recovering from a debilitating life-threatening injury. That is, urban revitalization work concerns much more than strategic deployment of those redevelopment “tools.” It goes far beyond helping your client close on tax credit financing for a major catalytic redevelopment project. Rather, it also depends on the patient persistence of a diverse team of ‘caregivers’ over a long period of time. Some of those ‘caregivers’ are internal to the community. They are the local merchants associations and neighborhood advocacy groups. They are also the local community development corporations, code enforcement staff, city councilpersons, assistant city attorneys, philanthropic foundation program officers, and the law school clinics with neighborhood organization clients. Neighborhood revitalization ordinarily requires keeping at least part of these diverse teams together for years – often more than a decade. In other words, it is worth discussing with our students that while they need to know the law and understand the nuances of the ‘tools’, the work of revitalizing a neighborhood is not usually just a transactional matter, but it is much more an organic process.
Kathy Laborde, is President and CEO of Gulf Coast Housing Partnership, one of Louisiana’s leading developers of commercial and residential projects serving low and moderate income communities. Beginning in the late 1990s as a community development banker, Laborde has worked with representatives of the O.C. Haley Boulevard neighborhood on redevelopment projects. Prior to Hurricane Katrina she also moved her development firm’s offices onto the Boulevard. Like the neighborhood merchants association and local community groups, Laborde knew O.C. Haley Boulevard had enormous potential to rebound – even as most New Orleanians ignored the corridor and consciously avoided it for fear of encountering the crime for which the Boulevard had become known. Together with a strong and cohesive band of neighborhood advocates, she has long been a steadfast proponent of revitalizing the Boulevard. In a meeting in her office earlier this month, I asked her why, in the late 1990s, she and neighborhood leaders believed that they could turn around the Boulevard’s fortunes.
In the next blog post, we look at snapshots of the Boulevard's challenging 15 year journey through and beyond Hurricane Katrina to an active neighborhood renaissance that continues to catch the attention of both the city's visitors and long-time residents.
John Travis Marshall, Georgia State University College of Law
August 11, 2014 in Community Economic Development, Development, Economic Development, Historic Preservation, Real Estate Transactions, Redevelopment, Urbanism | Permalink | Comments (0)
Thursday, June 26, 2014
Whitehouse v. CIR. 5th Circuit Upholds Major Deduction in Conservation Easement Valuation
No one is more surprised than I with how much time I spend reading about tax law these days, but I wanted to alert folks to another case regarding the valuation of historic conservation easements. This time, we are talking about Maison Blanche - a fancy former department store now an even fancier Ritz Carlton on Canal Street in New Orleans.
In 1997, the Whitehouse Hotel Ltd. (owner of the property) donated an historic preservation conservation easement to protect the facade to the Preservation Resource Center. Whitehouse's appraiser estimated the value of the conservation easement at $7.445 million (not $7,445 million as the 5th Circuit opinion mistates). The IRS cried foul and valued the conservation easement at $1.15 million and also dinged Whitehouse for an extra 40% for underpaying by more than 400%.
Unsurprisingly, litigation ensued. Whitehouse v. CIR, 2014 WL 2609866 (5th Cir. 2014), decided on June 11th is the second time the case has made it up to the 5th Circuit. The disputes have generally been battles of appraisals and valuation methods. I am not going to express any opinion about the appraisal methods but thought I'd point out a few things.
What does the conservation easement allow?
There was a big dispute here as to whether the conservation easement actually had any value. One of the appraisers suggested that because the conservation easement would not actually prevent Ritz Carlton from building what it want to build, the value should be zero. The highest and best use of the property is unchanged by the conservation easement. This conclusion turned in part on the language of the conservation easement and whether it actually prohibited the potential building of 60 additional rooms on part of the hotel complex. The Tax Court agreed with the appraiser that the conservation easement did not have such a prohibition. Whitehouse I, 131 T.C. 112 (Tax Ct. 2010). The Fifth Circuit disagreed. Whitehouse II, 615 F.3d 321 (5th Cir. 2010). On remand to the same judge, the Tax Court reviewed Louisiana servitude law and again stated its belief that the conservation easement did not restrict the additional building and should not have value BUT the Tax Court acknowledged that it was bound by the 5th Circuit's precedent and estimated the conservation easement value based on that assumption (coming up with as the 5th Circuit said "merely $1,867,716"). Whitehouse III, 139 T.C. 304 (Tax Ct. 2012).
Undoubtedly feeling that it got a raw deal from an unbiased judge, Whitehouse appealed but the 5th Circuit upheld the Tax Court stating that even though the Tax Court went out of its way to voice its disagreement with the 5th Circuit that was allowed as long as it actually followed the 5th Circuit.
Can you rely on tax professionals' assessments of your conservation easements?
Well, at first blush the answer to this question looks like "no" because the appraiser was so wrong. But the key question to consider for this case is whether Whitehouse's reliance on its appraiser and other professional should protect it from the penalty for gross underpayment (the 400% thing I mention above). There is a reasonable cause exception that allows taxpayers to get out from under this rather steep penalty. This issue is important for people interested in conservation easements because we see over and over again how far apart the private appraisals can be from those the IRS calculates. How much should we penalize landowners for their underpayments made in reliance on qualified professionals? The Tax Court imposed a 40% gross underpayment penalty, holding that Whitehouse had not done enough to demonstrate that it had reasonable cause to believe the appraisal. The court may have been particularly persuaded by the fact that the appraisal of the conservation easement exceeded the price actually paid for the property. The 5th Circuit reversed on this issue because Whitehouse had consulted with more than one appraiser and consulted other tax professionals. The 5th Circuit found this to be adequate.
I am really torn on this one. We want landowners to be able to rely on qualified appraisers and to impose a 40% tax penalty could be particularly painful to small landowners. But there have been repeated examples of bad appraisals around and it seems like there has got to be some type of smell test. Where a conservation easement is valued so much higher than the purchase price of the property, I hesitate too. Of course, I understand that the purchase price doesn't really tell you the value of the property and the value of what an entity like Ritz Carlton can get out of a property, but at the end of the day as a taxpayer, I don't even like the fact that the landowners here got a $1.8 million dollar charitable tax credit to build a big fancy hotel and condo complex that will make them oodles of dollars. Arguing that they lost $1.8 million because they couldn't make it as absolutely big as they might have just leaves a bad taste in my mouth.
June 26, 2014 in Architecture, Caselaw, Conservation Easements, Development, Economic Development, Federal Government, Historic Preservation, Land Trust, Real Estate Transactions | Permalink | Comments (1)
Wednesday, October 30, 2013
Athens Wal-Mart Project Dies
So it's been quite awhile since my last post, but I felt compelled to share the end of the story about putting a Wal-Mart in downtown Athens, Georgia. If you're a longtime reader of the blog you may remember that an Atlanta based developer proposed a mixed-use development, anchored by a Wal-Mart, in the center of Athens. (See my previous post here.) Although Wal-Mart never expressed official interest in the project, many local residents were highly opposed to the idea.
Yesterday the local paper featured a story saying that the developer has now abandoned the project entirely, due to market conditions. The development featured student apartments as its residential component, and downtown Athens is already overbuilt in that category. However, the site, while topographically challenging, is prime real estate. I'm sure as market conditions improve something will eventually be built there.
Jamie Baker Roskie
October 30, 2013 in Community Design, Development, Downtown, Georgia, Local Government, Planning, Real Estate Transactions, Redevelopment | Permalink | Comments (0) | TrackBack (0)
Tuesday, August 13, 2013
Professors' Corner teleconference on Real Estate Issues in the Bankruptcy Courts
It's time for the monthly "Professors' Corner" teleconference sponsored by the ABA Real Property Section. Here's this month's info! --Matt Festa
Professors' Corner: Wednesday, August 14, 2013
12:30pm Eastern/11:30am Central/9:30am Pacific
Call-in number: 866-646-6488
Professors’ Corner is a monthly FREE teleconference sponsored by the ABA Real Property, Trust and Estate Law Section's Legal Education and Uniform Laws Group. Each month’s call features a panel of law professors who discuss recent cases or issues of interest to real estate practitioners and scholars. Members of the AALS Property section are invited and encouraged to join in this call.
Our program on Wednesday, August 14 is “Real Estate Issues in the Bankruptcy Courts.” Our panel will discuss the latest on several important real estate issues in bankruptcy, including the “absolute priority” rule in individual Chapter 11 cases; the “strip-off” of underwater liens in Chapters 11 and 13; and the artificial impairment and artificial classification in Chapter 11 cases.
Our panelists for the program include three leading bankruptcy scholars:
Professor Ralph Brubaker, University of Illinois College of Law. Prof. Brubaker has taught at Illinois since 2004 after many years at Emory University Law School. He has served as Interim Dean and Associate Dean for Academic Affairs at Illinois and most recently as the Guy Raymond Jones Faculty Scholar. He will discuss a recent Fifth Circuit decision, In re Village at Camp Bowie I, L.P., and the extent to which a Chapter 11 debtor can “artificially” impair claims to facilitate cramdown of a reorganization plan and the status of the “artificial classification” doctrine.
Professor Bruce Markell, Florida State University. Prof. Markell returns to teaching at FSU in 2013 as the Jeffrey A. Stoops Professor, after many years of service as a United States Bankruptcy Judge for the District of Nevada and as a member of the Bankruptcy Appellate Panel for the Ninth Circuit. Prior to his service as bankrutpcy judge, Prof. Markell had a distinguished career as a law teacher at both Indiana University and UNLV. He will address recent case developments involving the “absolute priority rule,” including whether the rule applies in individual Chapter 11 cases and Judge Easterbrook’s recent “new value” decision in In re Castleton Plaza.
Professor Robert Lawless, University of Illinois. Prof. Lawless has taught at Illinois since 2006, and previously taught at both Missouri and UNLV. He currently serves as the Associate Dean for Research and the Co-Director of the Illinois Program on Law, Behavior, and Social Science. Prof. Lawless will address recent case developments regarding the ability of Chapter 11 and 13 debtors to “strip-off” underwater mortgage liens.
Please join us on Wednesday for this program!
August 13, 2013 in Conferences, Real Estate Transactions, Scholarship | Permalink | Comments (0) | TrackBack (0)
Wednesday, April 10, 2013
Davidson on New Formalism in the Aftermath of the Housing Crisis
Nestor Davidson (Fordham) has posted New Formalism in the Aftermath of the Housing Crisis, Boston University Law Review, Vol. 93, No. 389, 2013. The abstract:
The housing crisis has left in its wake an ongoing legal crisis. After housing markets began to collapse across the country in 2007, foreclosures and housing-related bankruptcies surged significantly and have barely begun to abate more than six years later. As the legal system has confronted this aftermath, courts have increasingly accepted claims by borrowers that lenders and other entities involved in securitizing mortgages failed to follow requirements related to perfecting and transferring their security interests. These cases – which focus variously on issues such as standing, real party in interest, chains of assignment, the negotiability of mortgage notes, and the like – signal renewed formality in nearly every aspect of the resolution of mortgage distress. This new formalism in the aftermath of the housing crisis represents something of an ironic turn in the jurisprudence. From the earliest history of the mortgage, lenders have had a tendency to invoke the clear, sharp edges of law, while borrowers in distress have often resorted to equity for forbearance. The post-crisis caselaw thus upends the historical valence of lender-side formalism and borrower-side flexibility.
Building on this insight, this Article makes a normative and a theoretical claim. Normatively, while scholars have largely embraced the new formalism for the accountability it augurs, this consensus ignores the trend’s potential negative consequences. Lenders have greater resources than consumers to manage the technical aspects of mortgage distress litigation over the long run, and focusing on formal requirements may distract from responding to deeper substantive and structural questions that still remain largely unaddressed more than a half decade into the crisis. Equally telling, from a theoretical perspective, the new formalism sheds light on the perennial tension between law’s supposed certainty and equity’s flexibility. The emerging jurisprudence underscores the contingency of property and thus reinforces – again, ironically – pluralist conceptions of property even in the crucible of hard-edged formalism.
April 10, 2013 in Affordable Housing, Housing, Mortgages, Politics, Property, Real Estate Transactions, Scholarship | Permalink | Comments (0) | TrackBack (0)
Monday, April 8, 2013
Professors' Corner teleconference on Legal Education and Uniform Laws
From Wilson Freyermuth (Missouri) via the property listserv comes the announcement for this Wednesday's Professors' Corner--the monthly free teleconference sponsored by the ABA's Section on Real Property, Trusts, & Estates. This one looks really interesting. See below for the info and dial-in instructions.
Professors' Corner: Legal Education and Uniform Laws Group Call
April 10, 2013, 12:30pm Eastern/11:30am Central/9:30am Pacific
Call-in number: 866-646-6488
The April 2013 program is entitled "Real Estate-Related Uniform Laws in Progress." This program will discuss the status of the two major uniform law projects related to real estate that are currently underway within the Uniform Law Commission (which we all used to know as NCCUSL).
The first project is a comprehensive revision of the Uniform Residential Landlord and Tenant Act. The URLTA was originally promulgated nearly 40 years ago and has been adopted, either in part or in whole, in approximately 20 states. During this month’s program, Professors Sheldon Kurtz (University of Iowa) and Alice Noble-Allgire (Southern Illinois University), who are the co-Reporters for this Act, will discuss the current status of this project and some of the key issues being addressed in this revision. These revisions will receive their "first reading" at this summer's annual meeting of the Uniform Law Commission in July 2013. In case you’re curious, here is a copy of the current draft of the Act: http://law.missouri.edu/freyermuth/JEBURPA/2013apr2_RURLTA_MtgDraft.pdf.
The second pending real-estate related uniform law project is a new project to produce a uniform act governing residential mortgage foreclosure processes. This project began earlier this year after extended study by the Uniform Law Commission, as well as a stakeholder meeting at which input was taken from both industry and consumer groups, as well as federal and state regulators. The Act proposes to address residential mortgage foreclosure processes and mortgagor protections in both judicial foreclosure and nonjudicial foreclosure. During the program, Professors James Smith (University of Georgia) and Alan White (City University of New York), who are the co-Reporters for this project, will discuss the status of this project and the key issues being addressed in this project. Here is a copy of the current draft of this Act, which will likewise receive its "first reading" at this summer's Uniform Law Commission meeting: http://www.uniformlaws.org/shared/docs/Residential%20Real%20Estate%20Mortgage%20Foreclosure%20Process%20and%20Protections/2012mar25_RREMFPP_MtgDraft_Clean.pdf.
Please join us on Wednesday for this month’s call!
April 8, 2013 in Conferences, Landlord-Tenant, Mortgages, Real Estate Transactions, Scholarship | Permalink | Comments (0) | TrackBack (0)
Wednesday, February 20, 2013
Plummer on The Effects of Property Tax Protests on Assessment Uniformity of Residential Properties
Elizabeth Plummer (Texas Christian) has posted The Effects of Property Tax Protests on the Assessment Uniformity of Residential Properties, forthcoming in Real Estate Economics. The abstract:
This study examines whether the appeals process improves assessment uniformity for residential properties. The sample includes all single family residential properties in Harris County, Texas, for 2006-2008. I use a hedonic pricing model and Heckman’s two stage approach to explain the assessed values of all properties before and after the appeals adjustments. Full sample results suggest that the appeals process increased assessment uniformity and that the value adjustments were appropriate in amount. I also present results across properties of different values (low, medium, high). The first stage probit model provides evidence on the factors that affect the likelihood that an owner will protest.
I'm personally excited to see this study of real estate value effects in my own backyard, here in The Unzoned City.
February 20, 2013 in Housing, Houston, Local Government, Property, Real Estate Transactions, Scholarship, Texas | Permalink | Comments (0) | TrackBack (0)
Thursday, November 15, 2012
Ghent on the Historical Origins of America's Mortgage Laws
Andra C. Ghent (Arizona State--Finance) has posted The Historical Origins of America's Mortgage Laws. This paper would be a really good resource for students, teachers, or practitioners who are interested in a concise but explanatory introduction to the development of state mortgage laws, including mortgage theory, foreclosure, and other important topics. The paper is a report for the Research Institute for Housing America. The abstract:
This paper examines the different legal frameworks for mortgage markets in different states, focusing on how and when they came into existence, including the British influence on laws in some of the older states, with a particular emphasis on foreclosures, including judicial vs. non-judicial regimes, redemption rights and deficiency judgments. The paper concludes that mortgage laws in America are a patchwork driven by path dependence, rather than a coordinated effort or a reaction to some economic event or condition.
November 15, 2012 in History, Housing, Mortgage Crisis, Mortgages, Real Estate Transactions, Scholarship | Permalink | Comments (0) | TrackBack (0)
Tuesday, November 13, 2012
Professors' Corner--Title Insurance and Services
Tanya Marsh has the details for this month's teleconference at Property Prof. As many of you know, the ABA Section on Real Property, Trust, & Estate Law has been hosting free teleconferences featuring law professors' discussions of recent cases and hot topics in the field. This month's "Professors' Corner" will focus on recent developments in title insurance and title services. Here is the info:
Wednesday, November 14, 2012
12:30 p.m. Eastern time (11:30 a.m. Central, 9:30 a..m. Pacific)
Call-in number: 866-646-6488
Tanya will moderate the discussion featuring Professors Joyce Palomar (Oklahoma), Barlow Burke (American), and Eileen Roberts (William Mitchell). Check it out if you are able. Some of us Land Users have had the opportunity to participate in past months' calls, and it's a great way to stay up to date.
November 13, 2012 in Caselaw, Conferences, Property, Real Estate Transactions, Scholarship | Permalink | Comments (0) | TrackBack (0)
Wednesday, October 24, 2012
Prum on Property Insurance for the Green Building
Darren Prum (Florida State - Business) has posted The Next Green Issue: Considering Property Insurance for the Green Building. The abstract:
As government policies across the country try to encourage more environmentally friendly buildings, the next green issue facing the owners of the completed structure is obtaining the proper insurance coverage to protect their investment. A typical property insurance policy covers the costs to reconstruct or replace property damaged as the result of a casualty, so the Insurance Service Organization and other carriers offer specific green building endorsements in an effort to augment the underlying property policy. However, these buildings maintain unique characteristics, which becomes relevant to the owner and policy underwriter as well as other stakeholders like the holder of a mortgage and major tenants. Accordingly, this article seeks to address the issues associated with a property insurance policy and the applicable endorsements that provide coverage for a green building.
October 24, 2012 in Green Building, Real Estate Transactions, Scholarship | Permalink | Comments (0) | TrackBack (0)
Friday, October 19, 2012
Johnson on the Economic Crisis, Homeownership, and Race
Marcia Johnson (Texas Southern) has posted Will the Current Economic Crisis Fuel a Return to Racial Policies that Deny Homeownership Opportunity and Wealth to African Americans?, published in The Modern American, Volume 6, Issue 1, Spring 2010. From the introduction:
Perhaps the greatest threat to the continued realization of the American dream is the latest economic crisis rooted in the sub-prime mortgage collapse.12 Some blame the CRA of 1977 for creating a market that they claim provided housing loans to noncreditworthy borrowers – particularly African American families – in the low and moderate income range.13 However, this charge is without direct factual support as the post-CRA period saw a decline in homeownership for African Americans but a mild increase for White homeowners.14 Illegal and fraudulent practices in property appraisals and income reporting directed program benefi ts away from those the program was meant to aid. . . .
This paper is written to examine the potential effect of the market collapse on our nation’s homeownership policies. Part I reviews America’s historical housing and homeownership policies. Part II considers the expansion of homeownership opportunities to historically non-participating communities, particularly the African American community. Part III reviews the culprits of the economic crash of 2008 and explains why sub-prime borrowers often get blamed. Part IV examines solutions to maintain America’s pro-homeownership policy, and Part V concludes that America’s homeownership policy should continue to be vigorously pursued with a goal of including African Americans who have long been excluded by government policies and sanctions from building wealth and thereby stabilizing their communities.
October 19, 2012 in Federal Government, History, Housing, Houston, Race, Real Estate Transactions, Scholarship | Permalink | Comments (0) | TrackBack (0)
Tuesday, October 9, 2012
ABA Professor's Corner on Eminent Domain for Mortgage Modifications
This month's installment of the ABA Section on Real Property's "Professor's Corner"--a free monthly teleconference featuring scholars' takes on important new property cases and issues--will feature a really hot topic, the proposal for municipal governments to take property by eminent domain to combat the mortgage/foreclosure crisis. The info, via David Reiss (who also recently posted a related public comment):
The program is Wednesday, October 10, at 12:30 pm EDT; 11:30 am CDT; 10:30 am MDT; 9:30 am PDT.
Participant Passcode: 5577419753
This month’s topic is Can/Should Municipalities Use Eminent Domain to Take Mortgages to Facilitate Mortgage Modifications? This conference call will be moderated by Professor James Geoffrey Durham, University of Dayton School of Law. Professor Steven J. Eagle, Professor of Law, George Mason University School of Law, is one of the nation’s leading scholars on eminent domain and regulatory takings. Professor Eagle will discuss whether it is possible for local governments to use eminent domain to acquire notes secured by mortgages in order to resell them to a private party which will then modify them, both under the 5th Amendment to the U.S. Constitution and also under state constitution taking clauses as they have been limited by amendments and statutes seeking to define what is a public use. Professor Robert C. Hockett, Professor of Law, Cornell Law School, is the scholar who in June proposed that municipalities could use eminent domain to acquire mortgages, in order to facilitate mortgage modifications to benefit underwater homeowners, in his article: It Takes a Village: Municipal Condemnation Proceedings and Public/Private Partnerships for Mortgage Loan Modification, Value Preservation, and Local Economic Recovery (download paper). Professor Hockett will discuss his proposal, which has received widespread attention. Professor Dale A. Whitman, James E. Campbell Missouri Endowed Professor Emeritus of Law, University of Missouri, Columbia, School of Law, is one of the premier experts on American property law and one of the nation’s foremost mortgage law scholars. Professor Whitman will discuss the impact that implementation of Professor Hockett’s proposal might have on the mortgage markets.
Check out the free telecast on this very interesting and current issue.
October 9, 2012 in Conferences, Eminent Domain, Financial Crisis, Housing, Local Government, Mortgage Crisis, Mortgages, Property, Real Estate Transactions, Scholarship, Takings | Permalink | Comments (0) | TrackBack (0)
Thursday, October 4, 2012
Reiss on the Use of Eminent Domain to Restructure Mortgages
David J. Reiss (Brooklyn) has posted Comment on the Use of Eminent Domain to Restructure Performing Loans, which was submitted to the Federal Housing Finance Agency (No. 2012–N–11) (2012). The abstract:
There has been a lot of fear-mongering by financial industry trade groups over the widespread use of eminent domain to restructure residential mortgages. While there may be legitimate business reasons to oppose its use, its inconsistency with Takings jurisprudence should not be one of them. To date, the federal government’s responses to the current crisis in the housing markets have been at cross purposes, half-hearted and self-defeating. So it is not surprising that local governments are attempting to fashion solutions to the problem with the tools at their disposal. Courts should, and likely will, give these democratically-implemented and constitutionally-sound solutions a wide berth as the ship of state tries to right itself after being swamped by a tidal wave of mortgage defaults.
A concise and thoughtful public comment on what is emerging as a hot, hot issue.
October 4, 2012 in Constitutional Law, Eminent Domain, Finance, Housing, Local Government, Mortgage Crisis, Mortgages, Property Rights, Real Estate Transactions, Scholarship, State Government, Takings | Permalink | Comments (0) | TrackBack (0)
Monday, September 10, 2012
Levitin & Wachter ask Why Housing?
Adam J. Levitin (Georgetown Law) and Susan Wachter (Penn--Wharton--Real Estate) have posted Why Housing?, Housing Policy Debate, vol. 23 (2012). The abstract:
come and go. Only the housing bubble, however, brought the economy to its knees.
Why? What makes housing uniquely a cause of macroeconomic risk?
This Article examines the workings of the housing market as well as theories and empirical evidence about the housing bubble. It explains why housing is a particular source of macroeconomic risk and how changes in the housing finance channel were the critical element in the formation of the bubble.
Interesting stuff. A lot has been written about the mortgage/financial crisis, but this is a good point in time for looking back with a more long-term perspective.
September 10, 2012 in Financial Crisis, Housing, Mortgage Crisis, Mortgages, Real Estate Transactions, Scholarship | Permalink | Comments (0) | TrackBack (0)
Wednesday, September 5, 2012
Pomeroy on the Case for Standardized Vesting Documents
Chad Pomeroy (St. Mary's) has posted A Theoretical Case for Standardized Vesting Documents. The abstract:
real estate professionals, and lay people throughout the country rely
on the recording system to provide critical information regarding
ownership rights and claims. Indeed, the recording system acts as a
virtually mandatory repository and disseminator of all potential
parties’ claims. This system, in turn, relies on these claimants and
their agents to publicize their claims: property purchasers, lenders,
lien-claimants, title companies, attorneys - these parties interact,
make deals, make claims, order their affairs, and then record. The
information system available to us, then, is only as good as what we
make of it and what we put into it.
As such, it is surprising how little thought has been put into exactly what it is that we record. Should the mortgage of a lender in Ohio look like that of a lender in Florida? Should a deed from an individual in Texas differ from that of a corporation in Nevada? As it stands now, no one familiar with real estate law or commerce would expect different parties in different jurisdictions to record identical, or even similar, instruments. In an immediate sense, this heterogeneity of the recorded documents (“vesting heterogeneity”) does not seem a good thing: parties utilizing the recording system generally seek to make known, or to discern, the same generic type of information – that is, evidence of claims upon property – so why are different forms and types of documents utilized all over the country?
This article analyzes this vesting heterogeneity from a new perspective and concludes that it is, in fact, cause for significant concern. Vesting heterogeneity has arisen organically, growing with the recording system as they both evolved over time. This historical explanation does not, however, excuse the cost associated with such a lack of uniformity. Anyone seeking information with respect to any piece of property must navigate the complexities and uncertainties that arise because all such information is heterogeneous and, as a consequence, difficult to understand and utilize. This represents both a immediate transactional cost and an increased risk of ill-informed behavior.
This is particularly troublesome because this sort of cost-based concern arising from variability has a well-established analogue in property law that the law clearly desires to avoid. That analogue is the cost that would arise if property law were to permit unlimited property forms and gives rise to what is known as the numerus clausus theory. This theory explains the law’s hostility toward new, or different, types of property and holds that such heterogeneity is not generally permitted because of the extremely high informational costs associated with such creativity.
This article suggests that this common law concept can, and should, inform our analysis of vesting heterogeneity and that it precipitates strongly against such lack of uniformity. This is because the costs that drive the numerus clausus to hold that variability should be limited are strikingly similar to those created by variability of vesting documents. As such, this theory is relevant here such that the same analysis should be applied to vesting heterogeneity by asking whether a different (or “new”) document is helpful enough to outweigh the informational costs inherent therein.
Based on this reasoning, this article concludes that the law is wrong to systematically ignore heterogeneity in vesting documents. Instead, a numerus clausus type of analysis should be applied to new or different vesting documents to determine whether any inherent lack of uniformity is defensible. Where it is not, uniformity should be imposed.
September 5, 2012 in Contracts, Finance, History, Mortgages, Property, Property Theory, Real Estate Transactions, Scholarship, State Government | Permalink | Comments (0) | TrackBack (0)
Thursday, August 23, 2012
NYT on Vietnam Property Bubble
China isn't the only Asian country on the brink of a property bubble bursting. In the New York Times, Thomas Fuller reports In Vietnam, Growing Fears of an Economic Meltdown:In Vietnam’s major cities, a once-booming property market has come crashing down. Hundreds of abandoned construction sites are the most obvious signs of a sickly economy.
“I can say this is the same as the crisis in Thailand in 1997,” said Hua Ngoc Thuan, the vice chairman of the People’s Committee of Ho Chi Minh City, the city’s top executive body. “Property investors pushed the prices so high. They bought for speculation — not for use.”
The article describes a Vietnam that sounds similar in many ways to the US and other places: a real estate bubble fueled by overpromotion; a recession that has left land development projects uncompleted; a disproportionate impact on younger workers; hard times for certain sectors of the economy, while others are relatively unscathed. Of course with Vietnam having dived in to the global economy in the past generation, the American recession and the European debt crisis are also having effects in Vietnam. But it's still quite interesting that the trigger seems to be a real estate bubble.
August 23, 2012 in Comparative Land Use, Development, Financial Crisis, Globalism, Property, Real Estate Transactions | Permalink | Comments (0) | TrackBack (0)
Sunday, August 19, 2012
Stein on China's Housing Market: Heading Toward a US-Style Crash?
Gregory M. Stein (Tennessee), who has written a bunch on real estate and land use in contemporary China, has posted Is China's Housing Market Heading Toward a US-Style Crash?, Arizona Journal of International and Comparative Law, Vol. 29, No. 1, 2011 . The abstract:
This article aims to determine whether China is heading toward a U.S.-style market crash in its housing market. Rather than attempting to maintain any suspense, I will disclose here that my conclusion is, “Who knows?” China and the United States have dramatically different histories, cultures, governments, economies, and legal systems. Anyone who claims to have a definitive answer to this question is overly confident.
My more modest goals in this article are to examine the available evidence and see which way it seems to point. The article begins by listing and describing several different ways in which the American housing market failed. It then evaluates the consequences of these failures for the U.S. housing market. Next, the article demonstrates some of the key respects in which the Chinese market differs from the market in the United States. This central portion of the article emphasizes just how difficult it is to make predictions about what might happen in one nation’s housing market based on the experiences of another nation that differs in so many significant ways. Finally, the article provides a description of some of the worrisome similarities between the Chinese and American housing markets. To the extent the previous analysis may have comforted the reader into believing that the Chinese market is unlikely to experience a downturn anytime soon, this last discussion will create some apprehension by highlighting some of the ways in which China might, in fact, be heading down the same path as the United States.
August 19, 2012 in Comparative Land Use, Housing, Mortgage Crisis, Real Estate Transactions, Scholarship | Permalink | Comments (0) | TrackBack (0)
Bauer on Age-Restricted Communities and Civil Rights Laws & Regulation
Mark D. Bauer (Stetson) has posted ‘Peter Pan’ as Public Policy: Should Fifty-Five-Plus Age-Restricted Communities Continue to Be Exempt from Civil Rights Laws and Substantive Federal Regulation? The abstract:
Although millions of Americans live in 55-plus age-restricted housing, little research has been done to determine whether these communities benefit their residents, or the nation as a whole. This is particularly ironic because these communities exist in contravention to anti-discrimination laws by virtue of a specific exemption granted to real estate developers by an Act of Congress. Ordinarily age discrimination is prohibited by the Fair Housing Act, Title VIII of the Civil Rights Act of 1968. Successful lobbying by special interest groups carved out an exemption for 55-plus housing.
The original exemption required developers to offer elders special services and facilities in these communities in return for the exemption. Over time, those requirements were eliminated and now the only requirement is that these communities exclude families and children.
While lifestyles focused on golf and tennis may be attractive to younger retirees, older Americans often find themselves in communities bereft of the services and facilities they need for basic life activities and safety. The very nature of these communities result in elders left with depreciating homes, and many are without the financial means to retrofit their 55-plus home or to move into a community better adapted for their needs. This Article explores a popular form of “senior housing” that is unsuitable for most older Americans.
August 19, 2012 in Community Design, Constitutional Law, Development, Federal Government, History, Homeowners Associations, Housing, HUD, Real Estate Transactions, Scholarship, Sun Belt | Permalink | Comments (0) | TrackBack (0)