Threat of Eminent Domain to Seize New Jersey Church Seeking Zoning Approval for a Homeless Shelter Generates Controversy
The City of Tom’s River, New Jersey is embroiled in controversy. A church is in the process of obtaining zoning approval to build a homeless shelter. While that was underway, the City passed an ordinance authorizing the use of eminent domain to acquire the church and its 11 acres of property to build a park.
If a Michigan city attempted this maneuver, would it be legal? Maybe, maybe not.
MCL 213.56(2) contains the standard applied to challenges to a city’s determination that a public project is necessary. “With respect to an acquisition by a public agency, the determination of public necessity by that agency is binding on the court in the absence of a showing of fraud, error of law, or abuse of discretion.” This is generally a deferential standard, but if a municipality was asserting that a public use was necessary for one reason when actually attempting to prevent the property owner from continuing a legal use, a trial court could potentially determine that either the fraud or abuse of discretion standard applied.
There are many variants of fraud recognized generally by Michigan law. Generally, fraud requires a material representation that was known to be false, and with the intention that it should be acted upon. Hi–Way Motor Co v Int'l Harvester Co, 398 Mich 330, 336 (1976). These elements have been simplified to remove aspects of them that do not neatly apply to the context of a necessity challenge as opposed to a plaintiff seeking a monetary award. If a city obscured the actual purpose of the taking to create a false basis to establish necessity, a court could find fraud.
“At its core, an abuse of discretion standard acknowledges that there will be circumstances in which there will be no single correct outcome; rather, there will be more than one reasonable and principled outcome….An abuse of discretion occurs when a decision falls outside the range of reasonable and principled outcomes.” People v Crumbley, 346 Mich App 144, 166–67 (2023). A trial court could focus on the need that an outcome be “principled” to avoid an abuse of discretion and that making false findings of purpose is unprincipled.
The Michigan Constitution could be triggered. If the court determined that the actual purpose was to eliminate a use deemed to create blight (as is implied in the Tom’s River situation to the extent that the City Council views a homeless shelter as creating blight, a higher standard would apply. “In a condemnation action, the burden of proof is on the condemning authority to demonstrate, by the preponderance of the evidence, that the taking of a private property is for a public use, unless the condemnation action involves a taking for the eradication of blight, in which case the burden of proof is on the condemning authority to demonstrate, by clear and convincing evidence, that the taking of that property is for a public use.” Article X, Section 2.
If I was presented with this situation in Michigan, I would pursue extensive discovery to establish the true motives behind the acquisition. Certainly, a church seeking to fulfil a charitable mission would be a highly sympathetic client. It would be risky for a municipality to pursue this strategy in Michigan, particularly because MCL 213.66 would require it to reimburse the property owner’s hourly attorney fees if the challenge is upheld.