Petition for Writ of Certiorari — Adams Outdoor Advertising v. City of East Lansing

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In the

| Supreme Court of the United States

| October Term, 2000

ADAMS OUTDOOR ADVERTISING,

Petitioner

v

CITY OF EAST LANSING,

Respondent

On Petition for Writ of Certiorari to the

Supreme Court of the State of Michigan

PETITION FOR WRIT OF CERTIORARI

Michael H. Perry (P 22890)

FRASER TREBILCOCK DAVIS & FOSTER, P.C.

Attorneys for Petitioner

1000 Michigan National Tower

Lansing, Michigan 48933

517/482-5800

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QUESTIONS PRESENTED

Whether the Michigan Supreme Court’s ruling that

the Petitioner/Lessee did not have a property right

protected by the Fifth Amendment of the United

States Constitution conflicts with this Court’s

rulings in United States v. General Motors, 323

U.S. 373; 65 S. Ct. 357; 89 L.Ed. 311 (1945) and

United States v. Petty Motor Co., 327 U.S. 372;

66 S.Ct. 596; 90 L.Ed. 729 (1946), both of which

recognized that the Fifth Amendment of the United

States Constitution protected a tenant’s interest in

real property?

Whether the Michigan Supreme Court’s ruling that

the Respondent had not unconstitutionally taken the

Petitioner’s interest in its rooftop billboards

conflicts with and is contrary to this Court’s ruling

in Lucas v. South Carolina Coastal Council, 505

U.S. 1003; 112 S.Ct. 2886; 120 L.Ed. 2d 798

(1992)?

Whether the Michigan Supreme Court committed

reversible error when it found that the Defendant’s

sign code did not effect a taking of Petitioner’s

interest in its rooftop signs because the

Defendant’s ordinance predated the Petitioner’s

acquisition of the billboards and leases and

predated the subsequent renewal of the leases?

ii

TABLE OF CONTENTS

QUESTIONS PRESENTED

INDEX OF AUTHORITIES

OPINIONS BELOW

JURISDICTION

THE LITIGATION

1. The Ingham County Circuit Court (Trial Court) .5

2. Michigan Court of Appeals

3. Michigan Supreme Court

SUMMARY OF ARGUMENT

REASONS FOR GRANTING THE WRIT

GROUNDS FOR ADAMS’ PETITION

il

A. THE MICHIGAN SUPREME COURT’S

RULING THAT THE PETITIONER/LESSEE DID

NOT HAVE A PROPERTY RIGHT PROTECTED

BY THE FIFTH AMENDMENT -OF THE

UNITED STATES CONSTITUTION CONFLICTS

WITH THIS COURT’S RULINGS IN UNITED

STATES v. GENERAL MOTORS, 323 U.S. 373;

65 S. CT. 357; 89 L.ED. 311 (1945) AND

UNITED STATES v, PETTY MOTOR CO., 327

U.S. 372; 66 S.CT. 596; 90 L.ED. 729 (1946),

BOTH OF WHICH RECOGNIZED THAT THE

FIFTH AMENDMENT OF THE UNITED

STATES CONSTITUTION PROTECTED A

TENANT'S INTEREST IN REAL PROPERTY .....

B. THE MICHIGAN SUPREME COURT’S

RULING THAT THE RESPONDENT HAD NOT

UNCONSTITUTIONALLY TAKEN” _ THE

PETITIONER’S INTEREST IN ITS ROOFTOP

BILLBOARDS CONFLICTS WITH AND IS

CONTRARY TO THIS COURT’S RULING IN

LUCAS __v, SOUTH CAROLINA COASTAL

COUNCIL, 505 U.S. 1003; 112 S.CT. 2886; 120

Les SE FI RE PUIED 6hihasiscnccdivesensednssiscenaaciés

C. THE MICHIGAN SUPREME COURT

COMMITTED REVERSIBLE ERROR WHEN IT

FOUND THAT THE DEFENDANT’S' SIGN

CODE DID NOT EFFECT A TAKING OF

PETITIONER’S INTEREST IN ITS ROOFTOP

iv

SIGNS BECAUSE THE DEFENDANT'S

ORDINANCE PREDATED THE PETITIONER'S

ACQUISITION OF THE BILLBOARDS AND

LEASES AND PREDATED THE SUBSEQUENT

RENEWAL OF THE LEASEG.................2c000008 15

CONCLUSION AND RELIEF REQUESTED........... 23

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GRMN sabe levtpchuteahdakeah Gebdupeceiacsstecansad execs 8, 23

Board of Regents of State College v. Roth, 408 U.S.

564; 92 S. Ct. 2701; 33 L.Ed. 2d 548 (1972)......... 19

Central Advertising Co, v. Ann Arbor, 391 Mich. 533;

a acca 22

Central Advertising Company v. Ann Arbor, 42 Mich.

App. 59; 201 N.W.2d 365 (1972)...........0...c0eeees 22

City of Monterey v. Del Monte Dunes, 526 U.S. 687;

119 S.Ct. 1624; 143 L.Ed. 2d 882 (1999) ............. 19

1003; 112 S.Ct. 2886; 120 L.Ed. 2d 798 (1992) passim

vi

Palazzolo v. Rhode Island, Supreme Court Docket No.

992047, cert. granted, 69 U.S. Law Week 3257 passim

438 U.S. 104: 98 S. Ct. 2646: 57 L.Ed. 2d 631

COPED Acdisrscsomaiicisisicisetiacincceascs 2, 15. 16

Redford Moving & Storage Co. v. City of Detroit, 336

Mich. 702, 711; 58 N.W. 2d 812 (1953) .............. 20

United States v. General Motors, 323 U.S. 373; 65 S.

Ces Saree MP ec RU DAR CEOMOE acicscivacsccsannances passim

United States v. Petty Motor Co., 327 U.S. 372; 66

S.Ct, 396; 90 L.Ed. 729 (1946) .........c.c.0c0ce0: passim

Wolverine Sign Works v. City of Bloomfield Hillis, 279

Mich. 205;-208; 271 N.W. 823 (1937)................. 21

Statutes

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Other Authorities

83 Am. Jur. 2d Zoning and Planning, § 656 ............. 20

Rules

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Supreme Court Rule 100) .....2...ccccccsccsscsccsdssesceces 8

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Constitutional Provisions

or |

The Petitioner, Adams Outdoor Advertising,

respectfully prays that a writ of certiorari issue to review

the judgment and opinion of the Michigan Supreme Court,

entered in the above-entitled proceeding on July 26, 2000.

OPINIONS BELOW

This petition is from a decision of the Michigan

Supreme Court reported at 463 Mich. 17; 614 N.W. 2d

634 (Mich. 2000) rehearing denied, 463 Mich. 1211

(Mich., 2000). The Michigan Supreme Court decision is

reproduced as Appendix item A. The Order denying the

Petitioner’s motion for rehearing is reproduced as

Appendix item B.

The Michigan Supreme Court decision reversed a

Michigan Court of Appeals decision, Adams Outdoor

Advertising v. City of East Lansing, 232 Mich. App. 587;

591 N.W. 2d 404 (Mich. App. 1998). This decision is

reproduced as Appendix item C.

There was one relevant decision by the Ingham

County Circuit Court. The Trial Court’s bench opinion is

reproduced as Appendix item D. The Trial Court’s

January 8, 1997 Order is reproduced as Appendix item E.

JURISDICTION

The Opinion of the Michigan Supreme Court

which is the subject of this Petition was filed and entered

2

on July 26, 2000. Thereafter, the Petitioner, Adams

Outdoor Advertising, timely filed a motion for rehearing

pursuant to Michigan Court Rule (M.C.R.) 7.313(D). The

Michigan Supreme Court denied the Petitioner's motion

for rehearing on September 19, 2000 (Appendix. item B)

This Petition for Writ of Certiorari is timely filed in

accordance with Rule 13.1 of the Rules of this Court.

This Court has jurisdiction over this matter pursuant to 28

U.S.C. § 1257(a).

CONSTITUTIONAL PROVISION AT ISSUE

The Fifth Amendment to the United States

Constitution states in relevant part:

“(N]or shall private property be taken for

public use without just compensation.”

The Fifth Amendment is applicable to the states

through the Fourteenth Amendment. Penn Central

Transportation Co. v. New York City, 438 U.S. 104,

122; 98 S. Ct. 2646; 57 L.Ed. 2d 631 (1978).

STATEMENT OF THE CASE

FACTS

This case arises out of the Respondent City of East

Lansing’s (hereafter Respondent or East Lansing)

elimination of the Petitioner Adams Outdoor Advertising’s

(hereafter Adams or Petitioner) lawfully constructed and

3

expressly permitted rooftop billboards. Adams leases two

separate parcels of real property within the City of East

Lansing (Plaintiff's trial exhibits 1 and 2 - leases for 1108

E. Grand River Avenue and 111 N. Harrison, East

Lansing, Michigan). It maintains and uses a rooftop

outdoor advertising structure at each location. There are

two 12 feet by 25 feet back-to-back poster panels located

at 1108 E. Grand River Avenue and there are three poster

panels located at 111 N. Harrison (Plaintiff's trial exhibits

1, 2 and 30). One of the properties was first leased to one

of Adams’ predecessors in 1954 (Plaintiff’s trial exhibit

2). The other was first leased to Adams’ predecessor in

1968 (Petitioner’s trial exhibit 1). In 1968, the Defendant

issued permits to Adams’ predecessor, Central

Advertising Company, for the billboards (Petitioner’s trial

exhibit 15 - request for admissions, {42-4 and Petitioner’s

trial exhibit 16 - Defendant’s answers to request for

admissions). The Petitioner's signs complied with the

Defendant’s code of ordinances before the Defendant

adopted its current sign code which is at issue in this case

(Petitioner’s trial exhibit 15 - request for admissions, {45-

7 and Petitioner’s trial exhibit 16 - Defendant’s answers

to request for admissions, ¢45-7).

In 1975, the respondent adopted its current sign

code. Section 8.38(12) of the code prohibits rooftop

billboards and signs (Appendix, item F, p. 2). Section

8.39(8) of the code required the elimination of all non-

conforming signs by May |, 1987 (Appendix, item F, p.

3). The Respondent’s sign code required the elimination

4

of Adams’ signs (Trial Tr. pp. 159-160). The

Respondent’s sign code did not provide for the payment of

compensation for the elimination of the non-conforming

billboards (Trial Tr., p. 88; Petitioner’s Trial exhibit 15 -

request for admissions, 410 and Petitioner’s trial exhibit

16 - Defendant’s answers to request for admissions, 410).

The evidence presented at trial was that the-value of

Adams’ rooftop signs was $57,500 and $55,000,

respectively, for a total of $112,500 (Trial Tr., pp. 87-

88).

5

THE LITIGATION

s The Ingham County Circuit Court (Trial Court).

In its Complaint in the Ingham County Circuit

Court (the Trial Court), Adams Outdoor Advertising, and

other parties not presently involved at the instant stage of

the proceeding, sought a declaratory judgment that the

Defendant’s uncompensated elimination of Adams’

previously lawful nonconforming billboards was contrary

to the Fifth Amendment of the United States Constitution.

Adams had also sought a declaration that the Respondent’s

ordinance was contrary to Michigan statutory law.

Although the Trial Court and the Michigan Court of

Appeals agreed with the latter, the Michigan Supreme

Court found to the contrary. Adams v. East Lansing, 439

Mich. 209, 219; 483 N.W. 2d 38 (1992) (Adams I). The

Michigan Supreme Court remanded the case to the Trial

Court to determine whether the application of the

Defendant’s sign code to Adams’ signs resulted in an

unconstitutional taking. 439 Mich. at 219.

Following the Michigan Supreme Court’s 1992

remand, the Trial Court conducted a trial on December 9,

1996. In its Trial Brief, Adams argued that the

Defendant’s elimination of the rooftop billboards was an

unconstitutional taking, contrary to the Fifth Amendment.

The Trial Court so found (Appendix, items D and E).

6

2. Michigan Court of Appeals.

The Michigan Court of Appeals affirmed the Trial

Court's ruling insofar as it pertained to Adams’ rooftop

billboards. 232 Mich. App. 587, 605; 591 N.W. 2d 404

(1998) (Appendix, item C, p. 19).

3. Michigan Supreme Court.

Despite the fact that the Respondent had failed to

make such an argument, the Michigan Supreme Court

analyzed Adams’ rights vis-a-vis those of the Lessors who

were not parties to the case. 463 Mich. at 24 - see

Appendix, item A, p. 8. As described above, the Court

found that the Lessors had no right to display the rooftop

signs upon their rooftops and that Adams lacked such a

right as well. 463 Mich. at 26; Appendix, item A, p. 10.

The Court also found that because Adams had acquired its

rooftop signs and leases in 1983 and had renewed those

leases in 1993 and 1996, it lacked a reasonable

expectation that it could maintain its signs after the

ordinance’s effective date of May |, 1987. 463 Mich. at

27; see, Appendix, item A, p. 11.

SUMMARY OF ARGUMENT

The Michigan Supreme Court's analysis of Adams’

constitutional rights as a lessee, as being derivative of

those of its lessors, conflicts with this Court's recognition

that the Fifth Amendment applies to a tenant's interest in

7

property. United States v, General Motors, supra, and

The enforcement of the Defendant's sign code

results in the complete elimination of Adams’ rooftop

billboards. This is a “categorical” taking and is contrary

to this Court’s ruling in Lucas v. South Carolina Coastal

Council, supra.

The Michigan Supreme Court’s holding that

Adams did not have a reasonable expectation that it could

maintain its signs and renew its leases after the effective

date of the Defendant's ordinance is also contrary to

Lucas. supra, and well-established common law real

property principles. As noted later in this Petition, the

question of whether one’s regulatory takings claim is

barred where the enactment of the regulation at issue

predates the claimant’s acquisition of the property is

presently pending before this Court in Palazzolo v, Rhode

Island, Supreme Court Docket No. 992047, cert. granted,

69 U.S. Law Week 3257 (October 10, 2000); see, 69

U.S. Law Week 3027 (July 11, 2000) for the statement of

the questions presented in Palazzolo, supra.

REASONS FOR GRANTING THE WRIT

GROUNDS FOR ADAMS’ PETITION

The grounds for the instant petition are as follows.

First, the Michigan Supreme Court has decided an

important federal question (i.e., whether a governmental

8

body had unconstitutionally taken one’s leasehold interest

in property without the payment of just compensation

therefor, contrary to the Fifth Amendment) in a way that

conflicts with the relevant decisions of this Court,

including United States v. General Motors, supra, United

States v. Petty Motors, supra, Lucas v, South Carolina

Coastal Council, supra, and Almota Farmers Elevator &

Warehouse Co. v. United States, 409 U.S. 470; 93 S. Ct.

791; 35 L. Ed. 1 (1973). See, Rule 10(c) of the Supreme

Court Rules.

Second, the Michigan Supreme Court has decided

an important question of federal law (see above) in a way

which conflicts with Lucas, supra, which prohibits the

uncompensated “categorical taking” of one’s property.

See, Rule 10(b) of the Supreme Court Rules.

Third, the Michigan Supreme Court has decided an

important question of federal law, i.e., whether one can

maintain a regulatory taking claim where the regulation at

issue predated the property owner’s acquisition of the

property, which has not been, but should be, settled by

this Court. See, Rule 10(c) of the Rules of the Supreme

Court. This particular issue is presently before the Court

in the matter of Palazzolo v. Rhode Island, supra.

9 “ey

A. THE MICHIGAN SUPREME COURT’S

RULING THAT THE PETITIONER/

LESSEE DID NOT HAVE A

PROPERTY RIGHT PROTECTED BY

THE FIFTH AMENDMENT OF THE

UNITED STATES CONSTITUTION

CONFLICTS WITH THIS COURT’S

RULINGS IN UNITED STATES _v.

GENERAL MOTORS, 323 U.S. 373; 65

S. CT. 357; 89 L.ED. 311 (1945) AND

UNITED STATES yv. PETTY MOTOR

CO., 327 U.S. 372; 66 S.CT. 596; 90

L.ED. 729 (1946), BOTH OF WHICH

RECOGNIZED THAT THE FIFTH

AMENDMENT OF THE UNITED

STATES CONSTITUTION PRO-

TECTED A TENANT’S INTEREST IN

REAL PROPERTY.

The Michigan Supreme Court found that the

constitutional rights of Adams, the lessee, were derivative

of those of its two lessors. 463 Mich. at 24-26. By doing

so, the Michigan Supreme Court decision ran afoul of this

Court’s ruling in United States v. General Motors, supra.

In that matter, the United States had condemned part of

General Motors’ leasehold for the storage of wartime

material. 323 U.S. at 375. The government had not

condemned the landlord’s fee interest but instead only

sought to take the lessee’s interest in the property. 323

10

U.S. at 375. During the course of its opinion this Court

recognized that:

“the right to occupy, for a day, a month, a

year, or a series of years, in and of itself

and without reference to the actual use,

—_ needs or collateral arrangements of the

occupier, has a value.” 323 U.S. at 379.

This Court then held:

“When [the government] takes the

property, that is, the fee, the lease,

whatever [one] may own, terminating

altogether his interest, under the established

law it must pay him for what is taken...”

323 U.S. at 382.

The Michig’ 1 Supreme Court’s derivative analysis

of Adams’ rights is contrary to this Court’s analysis of

General Motors’ Fifth Amendment rights. It is also

contrary to this Court’s finding in United States v. Petty

Motor Co., 327 U.S. 372; 66 S. Ct. 596; 90 L. Ed. 729

(1946), another case arising out of the government’s

condemnation of a property for use during World War II.

Although the building’s owner had agreed that the

government may temporarily use the property, the United

States proceeded to condemn the various tenants’

leasehold interests. 327 U.S. at 374. During the course

of its opinion, this Court in Petty Motor Co, said:

11

“... It is immaterial whether the

government actually took the leaseholds of

the tenants in addition to taking the

temporary use of the fee or only destroyed

the tenants’ right of occupancy. If any

property is taken, compensation is

required.” 327 U.S. at 378.

The instant Michigan Supreme Court’s ruling is

directly contrary to the principles of General Motors and

Petty Motor Co. In neither of those cases did this Court

determine whether the respective tenant’s rights to

compensation were derivative of the respective lessor’s

rights. In both of those cases, the landlord/lessor’s

interest was not at issue. In General Motors, the

government had not condemned the fee. 323 U.S. at 375.

In Petty Motor Co., the lessor had agreed that the

government could use the property. 327 U.S. at 374.

Notwithstanding those lessors’ situations, this Court found

that the Fifth Amendment protected the ee of the

lessees in both of those cases.

Because the Michigan Supreme Court’s ruling is

contrary to this Court’s rulings in General Motors, supra,

and Petty Motor Co., supra, Adams respectfully requests

the Court to grant the Petition for Certiorari and thereafter

reverse the Michigan Supreme Court’s erroneous ruling.

12

B. |THE MICHIGAN SUPREME COURT’S

RULING THAT THE RESPONDENT

HAD NOT UNCONSTITUTIONALLY

TAKEN THE PETITIONER’S

INTEREST IN ITS ROOFTOP

BILLBOARDS CONFLICTS. WITH

AND IS CONTRARY TO _ THIS

COURT’S RULING IN LUCAS vy.

SOUTH __ CAROLINA __ COASTAL

COUNCIL, 505 U.S. 1003; 112 S.CT.

2886; 120 L.ED. 2D 798 (1992)

The instant Trial Court relied upon Lucas v. South

Carolina Coastal Council, supra in support of its finding

that the Defendant’s ordinance was _ unconstitutionai

(Appendix, item D, p. 5).

In Lucas, the State of South Carolina had enacted a

statute which prevented the erection of a structure upon

one’s beach-front property. Lucas sustained the beach-

front property owner’s contention that the adoption of a

Statute was an unconstitutional taking, and reaffirmed the

general principle that: ;

“When the owner of real property has been

called upon to sacrifice gi/ economically

beneficial uses in the name of the common

good, this is, to leave his property

economically idle, he has suffered a

——

13

taking.” 505 U.S. at 1019 (emphasis in

original).

Like the State of South Carolina, the instant Defendant, by

way of a legislative pronouncement (i.e., an ordinance),

called upon Adams to sacrifice all of the economically

beneficial uses of its rooftop billboards. The Trial Court

correctly applied Lucas (and the instant Court of Appeals

correctly applied its principle) to the Defendant’s

ordinance and found that the Defendant’s compelled and

uncompensated removal of Adams’ rooftop signs was an

unconstitutional taking. _ The Michigan Supreme Court

erroneously ruled to the contrary. Adams respectfully

requests this Court to grant its Petition for Certiorari and

find that Lucas applies to the instant matter and mandates

a finding that the Defendant's ordinance is contrary to the

Fifth Amendment.

As this Court held _in Lucas, the only

constitutionally permissible basis for the government’s

right to take one’s property without paying for it is if the

property’s use is a nuisance. Lucas held:

“...as it would be required to do if it sought

to restrain Lucas in a common-law action

for public nuisance, South Carolina must

identify background principles of nuisance

and property law that prohibit the uses he

now intends in the circumstances in which

the property is presently found. Only on

14

this showing can the State fairly claim that,

in proscribing all such beneficial uses, the

Beachfront Management Act is taking

nothing.” (underlining added, footnote

omitted) 505 U.S. at 1031 - 1032.

By substituting the words “Adams,” “East Lansing,”

“city,” “rooftop billboards,” and “sign ordinance” for the

above underlined words, respectively, this Court can, and

should, make Lucas’ holding its own. —

Adams’ off-premises billboard signs are not a

nuisance. The Respondent never claimed that they were.

Further, during the course of its first opinion in this

matter, the Michigan Supreme Court, through one of its

justices, recognized that Adams’ billboards “are not

contraband.” 439 Mich. at 239 (Justice Levin).

Also, the Michigan Legislature has recognized

that:

“Outdoor advertising is a_ legitimate

commercial use of private property, is an

integral part of the marketing function and

an established segment of the economy of

this state.” M.C.L. 252.303; M.S.A.

9.391(103).

Adams’ billboards are not nuisances. Lucas recognized

that the government may not deprive one’s property of its

Ss

15 =

“economic utility” unless that property’s use qualifies as a

nuisance. 505 U.S. at 1031. The instant Respondent,

contrary to Lucas, has indeed deprived Adams’ leasehold

interests of their “economic utility.” By doing so, the

Defendant has taken Adams’ property without the

payment of just compensation, contrary to the Fifth

Amendment.

C. THE MICHIGAN SUPREME COURT

COMMITTED REVERSIBLE ERROR

WHEN IT FOUND THAT THE

DEFENDANT’S SIGN CODE DID NOT

EFFECT _A TAKING OF

PETITIONER’S INTEREST IN ITS

ROOFTOP SIGNS BECAUSE THE

DEFENDANT’S ORDINANCE PRE-

DATED THE PETITIONER’S

ae ACQUISITION OF THE BILLBOARDS

AND LEASES AND PREDATED THE

SUBSEQUENT RENEWAL OF THE

LEASES.

The Michigan Supreme Court purported to analyze

Adams’ regulatory takings claim under both the Lucas

“categorical” analysis and the Penn Central

Transportation Co. v. New York City, 438 U.S. 104; 98

S. Ct. 2646; 57 L.Ed. 2d 631 (1978) “balancing test.”

One of the factors relevant to the latter is: :

a

16

“The extent by which the regulation has

interfered with distinct, investment-backed

expectations.” Penn Central, supra, 438

U.S. at 124.

Apparently referring to the third prong of Penn Central's

balancing test, the instant Michigan Supreme Court found

that Adams lacked a “reasonable expectation” that it could

use its rooftop signs after May 1, 1987 where Adams had

acquired its signs and leases in 1983 (after the 1975

passage of the ordinance) and had renewed its leases in

1993 and 1996. 463 Mich. at 27; see Appendix, item A,

p. 11. Assuming arguendo, that this Court finds that the

Defendant’s ordinance did not result in a Lucas-style

categorical taking, Adams respectfully requests the Court

to grant the instant Petition for Certiorari, as it did in

Palazzolo, supra, and thereafter find that Adams’

acquisition of its signs and leases after the adoption of the

ordinance, and its renewal of those leases after its

effective date, does not preclude its claim.

Presently pending before this Court is Palazzolo v.

Rhode Island, United States Supreme Court Docket No.

99-2047. The Court granted the Petition for Certiorari

therein on or about October 10, 2000. 69 U.S. Law

Week 3257 (October 10, 2000). One of the questions

presented in Palazzolo is whether one’s regulatory takings

claim is barred whenever the regulation at issue predates

the claimant’s acquisition of the property. Palazzolo,

Docket No. 99-2047, 69 U.S. Law Week 3027 (July 11,

17

2000). The Rhode Island Supreme Court had found that

Mr. Palazzolo could not maintain his regulatory takings

claim where the State of Rhode Island’s regulation had

predaie? his acquisition of the property. 746 A.2d 707,

715. ‘he instant Michigan Supreme Court made a similar

finding. 463 Mich. at 27. The Michigan Supreme Court

made the same error that the Rhode Island Supreme Court

made. Adams requests this Court to grant its Petition for

Certiorari, as it did in Palazzolo, supra and find that

Adams’ acquisition of its billboards and leases after the

adoption of the instant Respondent’s 1975 sign code does

not preclude a finding that Adams had a reasonable

expectation that it could continue to maintain its rooftop

billboards after May 1, 1987.

During the course of its opinion, Palazzolo

referred to this Court’s statement in Lucas, supra, that:

“Where the State seeks to sustain regulation

that deprives land of all economically

beneficial use, we think it may resist

compensation only if the logically

antecedent inquiry into the nature of the

owner’s estate shows that the proscribed

use interests were not part of his title to

begin with.” Lucas, supra, 505 U.S. at

1027, cited in Palazzolo, supra, 746 A.2d

at 715.

eRe eae

18

Palazzolo found that because the property owner therein

had acquired his property after the State’s regulations in

question were already in place, the owner lacked a

regulatory takings claim. 746 A.2d at 715. Palazzolo

also relied upon the above Lucas statement when it

rejected Mr. Palazzolo’s argument that the date of the

regulation’s adoption was irrelevant. 746 A.2d at 716.

Further, Palazzolo held that because the regulations had

been in place when Mr. Palazzolo acquired the property,

he lacked an investment-backed expectation that he could

fill the coastal wetlands at issue therein. 746 A.2d at 717.

As noted in Palazzolo, supra, Lucas requires the

Court to determine whether the nature of one’s estate

included the use in question. 746 A.2d at 715, citing

Lucas, supra. An analysis of Adams’ estate should lead

this Court to grant the instant petition to reverse the

erroneous ruling of the Michigan Supreme Court.

First, unlike the situation in Palazzolo, and of

greater Fifth Amendment significance, the instant case

involves the elimination of an existing use of property.'

f

' Adams is unaware of any decision by this Court which

upheld a governmental body’s uncompensated elimination

of an existing and lawful use of property. Typically, this

Court has considered a regulatory takings claim within the

context of the proposed development of one’s property.

See, ¢.g. City of Monterey v. Del Monte Dunes, 526

Pe A a eed

19

Palazzolo involved a request to develop raw land (coastal

wetlands). The instant Respondent had issued permits for

the rooftop billboards at issue more than seven years

before the adoption of the ordinance and approximately 19

years before its effective date. The billboards were lawful

before the Respondent passed and then later enforced its

ordinance.

State common law principles define the property

rights and interest that are protected by the United States

Constitution. Board of Regents of State College v. Roth,

408 U.S. 564, 577; 92 S. Ct. 2701; 33 L.Ed. 2d 548

(1972). One such common law principle of real property

law is that:

“The right to maintain a nonconforming use

does not depend upon ownership or tenancy

of the land on which the use is situated. It

is not personal to the current owner or

tenant but attaches to the land itself.

Accordingly, a change in the ownership or

tenancy of a nonconforming business or

structure does not affect the right to

continue the nonconforming use; such right

can be exercised equally by the purchaser.

Since the right runs with the land, it is not

lost. although the use in question was

U.S. 687, 704; 119 S.Ct. 1624; 143 L.Ed. 2d 882 (1999)

and Lucas, supra.

20

conducted by a tenant and is carried onbya ~

new tenant.

“A change of ownership of land to which a

nonconforming use has attached does not

affect the right to such use although the

change occurred after the restrictive

ordinance became effective. And the right

is not forfeited by a purchaser who takes

with knowledge of the regulations which

are inconsistent with the existing use.” 83

Am. Jur. 2d Zoning and Planning, § 656,

pp. 557-558 and cases cited therein

(footnotes omitted. )

Although the above text does not cite any

Michigan decisions, Michigan law is in accord with the

rule that a subsequent owner has the constitutional right to

continue a predecessor's non-conforming use of the

purchased property. Redford Moving & Storage Co. v.

City of Detroit, 336 Mich. 702, 711; 58 N.W. 2d 812

(1953).

Unlike the property owner in Palazzolo, supra,

Adams acquired an existing and lawful use of property.

Although the Respondent had, by fiat, declared that use to

? Adams |, supra, held that the instant Respondent had the

implied statutory authority to eliminate the non-

conforming signs. 439 Mich. at 219.

TEE

21

be nonconforming in 1975, that lawful nonconforming use

ran with the real property owned by Adams’ lessors.

Consistent with Lucas’ above admonition (approvingly

cited in Palazzolo, supra), the instant Respondent is

unable to eliminate Adams’ right to continue to use the

property without paying Adams just compensation. 505

U.S. at 1027.

Second, as a matter of fact, Adams had a distinct

expectation that it would be allowed to continue to use the

billboards in question. Both the general history of

billboard jurisprudence within the State of Michigan, and

in particular, the experiences of Adams’ immediate

predecessor, Central Advertising Company, demonstrate

that Adams had a reasonable expectation that it could

continue to use the rooftop leaseholds. Among other

things, the following factors support this proposition:

e In 1937, the Michigan Supreme Court held that

a city’s police power authority to regulate

billboards did not allow a city to terminate the

use of a non-conforming billboard. Wolverine

Sign Works v. City of Bloomfield Hills, 279

Mich. 205, 208; 271 N.W. 823 (1937):

e In 1972, three years before the Defendant

adopted its ordinance, the Michigan Court of

Appeals held that the City of Ann Arbor did

not have a right to eliminate over time Central

Advertising Company’s non-conforming off-

22

premises billboards. Central Advertising

Company v. Ann Arbor, 42 Mich. App. 59,

73; 201 N.W.2d 365 (1972).

In 1974, more than a year before the Defendant

adopted its ordinance and 13 years before its

effective date, the Michigan Supreme Court

affirmed the above Court of Appeals ruling,

albeit on other grounds. Central Advertising

Co. v. Ann Arbor, 391 Mich. 533; 218

N.W.2d 27 (1974).

In April of 1975, the Washtenaw County

Circuit Court reaffirmed its findings regarding

the invalidity of the City of Ann Arbor’s sign

code. In June of 1975, the Michigan Supreme

Court affirmed the Trial Court’s ruling within

the context of its prior holding. Central

Advertising Co, v. Ann Arbor, 394 Mich. 943

(1975).

Adams acquired its rooftop leaseholds from

Central Advertising Company in 1983. It did

so after many years of Michigan biliboard

jurisprudence had established the rights of a

billboard owner. One of those owners was

Adams’ immediate predecessor (Central ©

Advertising Company) and the party to whom

the Defendant had issued permits and a license

for the instant billboards.

23

Adams also had the legal right to expect that it

could renew its leases with its lessors. Its Fifth

Amendment-protected leasehold rights (see, General

Motors and Petty Motor Co., supra), included its right to

renew its leases. Almota Farmers Elevator & Warehouse

Co, v. United States, 409 U.S. 470; 93 S.Ct. 791: 35

L.Ed. 2d 1 (1973). Adams had a right to renew its leases

in 1993 and 1996.

The relevant Michigan jurisprudential history

applicable to the instant case, buttressed by this Court’s

decisions in, among others, General Motors, Petty

Motors, and Almota Farmers Elevator & Warehouse,

supra, demonstrates that Adams had a _ reasonable

expectation that it would be allowed to continue to use the

rooftop billboards. The right to use those lawful pre-

existing structures ran with the land. This was part of

Adams’ “title,” i.e., its “bundle” of rights. Adams had

an expectation that it could use the billboards. For these

reasons, Adams requests the Court to grant this Petition

for Certiorari and reverse the decision of the Michigan

Supreme Court.

CONCLUSION AND RELIEF REQUESTED

As demonstrated above, the Michigan Supreme

Court’s finding is clearly contrary to many of this Court’s

decisions. The Michigan Supreme Court did not merely

misapply a properly stated rule of law. Rather, its

24

decision is clearly contrary to the Fifth Amendment’s

requirement that the Defendant must pay just

compensation for the elimination of Adams’ property

rights. Adams requests the Court to grant its Petition for

Certiorari, find that the enforcement of the Defendant’s

sign code is contrary to Adams’ Fifth Amendment rights,

and reverse the erroneous decision of the Michigan

Supreme Court.

Respectfully submitted,

FRASER TREBILCOCK DAVIS & FOSTER, P.C.—

Attorneys for Plaintiffs

“ : )

By: tls hse ie ny

Michael H. Perry (P 228907

1000 Michigan National Tower -

Lansing, Michigan 48933

(517) 482-5800

Dated: December 18, 2000

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.

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