The Euclid Society met again on Thursday March 12, 2013, to discuss the case of David Hill Development v. the City of Forest Grove. As has been discussed before on this blog, the David Hill case resulted in a 6.5 million dollar jury verdict against the City of Forest Grove for a series of violations of the developer’s constitutional rights. The Euclid Society discussed the specifics of the case, how it happened and how to avoid such results in the first place.
The basic facts were undisputed – David Hill Development, LLC, bought several acres of farmland at the edge of the UGB and sought to develop a large subdivision. Although the property was flat farmland and generally easy to develop, it faced a few challenges. First, to the south was a phased development that had brought sewer most of the way to the property, but the final phase, which was not yet built, was where the gap would be bridged. In addition, the boundary between the two developments would be a road. In addition, a neighbor to the north, whose property was outside the UGB, was concerned that the sewer be built in such a way that his property could be served.
The City approved a subdivision for the property in September of 2005 and things quickly went downhill. The plaintiff argued that it lost a significant amount of money due to delays caused by the City and that the City treated plaintiff differently than other developers. Some of the plaintiff’s complaints included a requirement multiple sewer alignments, a stop work order that was later rescinded, requiring the sewer line to be built too deep (solely to serve the property to the north) and the requirement to build more of the road on the boundary line to the south. The City pointed to various reasons why each of those delays and treatment of plaintiff were reasonable but, ultimately, the jury, and later, the magistrate, agreed with plaintiff and found that the City had violated David Hill Development’s constitutional rights.
The discussion Thursday night began with a discussion of the timeline and some background information about the constructional provisions. The group then discussed the specific issues related to the sewer line and to the road and concluded with some discussions of the lessons to be learned. There was some disagreement about whether this was a unique case, based on the falling market and poor treatment of the plaintiff, but there were some universal lessons, including:
1. Act professionally.
2. Treat people fairly.
3. Follow the advice of your lawyer.
We would welcome any additional comments or discussion on the case and any lessons learned.
We regularly update clients about changes in real estate law and on industry trends. This includes briefing clients on legislative proposals in the federal tax, housing and other legal areas affecting their businesses. Staying current enables you to anticipate and prevent legal problems as well as capitalize on new developments.