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Chancellor Manor v. United States

Citation: 33 ELR 20222
No. No. 02-5066, (Fed. Cir., 06/12/2003)

The court holds that a trial court erred in its determination that real estate developers who claimed that the government's enactment of legislation relating to low-income housing programs that breached contracts between the developers and the United States did not possess protectible real property interests and, therefore, presented no compensable takings claims. The lower court correctly granted summary judgment with respect to the developers' breach of contract claims. However, it incorrectly determined that the developers did not possess protectible real property interests. The enactment of the Emergency Low-Income Housing Preservation Act and Low-Income Housing Preservation and Resident Homeownership Act imposed additional restrictions on the developers' real property interest, e.g., prohibiting prepayment absent U.S. Department of Housing and Urban Development approval based on stringent requirements, which were not in existence when the developers first entered the programs. Contrary to the lower court's conclusion, whether they knew or should have known that the regulations could be changed is more properly an issue germane to a Penn Cent. Transp. Co. v. New York City, 438 U.S. 104, 8 ELR 20528 (1978) analysis, not to whether the developers possessed a protected property right. However, because the matter of whether a regulatory taking occurred cannot be decided on the present record, the court remands the case for a more searching factual inquiry.

Counsel for Plaintiff
Jeff H. Eckland
Faegre & Benson
2200 Norwest Ctr.
90 S. 7th St., Minneapolis MN 55402
(612) 336-3000

Counsel for Defendant
John E. Kosloske
Civil Division
U.S. Department of Justice, Washington DC 20530
(202) 514-2000