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Woodland Manor III Assocs., Ltd. Partnership v. McCleod

Citation: 30 ELR 20448
No. No. 89-2477, (R.I. Super. Ct., 03/02/2000)

The court holds that a limited partnership does not have standing to maintain a cause of action under the Fifth Amendment of the U.S. Constitution for temporary inverse condemnation against a state environmental agency that required a freshwater wetlands permit application to be filed in connection with a four-phase construction project. A development corporation that owned the land filed suit against the agency and sought equitable relief to prevent the agency from requiring the application. In the meantime, the principals of the development corporation formed a limited partnership and transferred the subject property to the partnership by warranty deed along with the right to continue to prosecute the litigation. The trial court then granted the requested relief and estopped the agency from requiring a wetlands permit application, but the partnership subsequently learned that its plan for the final phase of development was impossible. It then filed an inverse condemnation action against the agency and sought monetary damages.

The court first holds that the law of the case doctrine does not confer standing to the limited partnership. The question of the limited partnership's standing to maintain a temporary inverse condemnation claim was neither raised nor decided during the trial on the original complaint. During the trial of the original complaint the limited partnership continually maintained it was seeking only equitable relief and was not seeking monetary damages or pursuing a Fifth Amendment takings claim. Therefore, the factual finding that the business entities used in each phase of the project comprised the same individuals is not dispositive of whether and to what extent the limited partnership, in acquiring title to the subject property, was entitled to any damages accruing from the development corporation's cause of action. The court next holds that the limited partnership does not have standing to assert a takings claim. The constitutional right to seek redress for the alleged temporary inverse condemnation belongs to the development corporation as the owner of the property during the time of the alleged taking. A limited partnership that had no cognizable individual ownership interest in the property during the time of the alleged taking, and purchased the property with knowledge of the regulatory restrictions, does not have standing to assert a takings claim. The court further holds that the development corporation did not assign to the limited partnership other possible causes of action that were not then-brought before the court, but that were available to the development corporation.

The full text of this opinion is available from ELR (19 pp., ELR Order No. L-192).

[Counsel not available at this printing.]