Condemning Unsafe Nonresidential Structures

CONDEMNING UNSAFE NONRESIDENTIAL STRUCTURES

Municipal Attorneys Conference

Chapel Hill

March 23, 2007

Richard Ducker

School of Government

UNC – Chapel Hill

919-966-4179

Rich Ducker

School of Govt/UNC

Bldg.CondemnLaw March 2007

CONDEMNING UNSAFE NONRESIDENTIAL STRUCTURES

I.Relevant sources of authority

A. Nonresidential unsafe-building condemnation power (G.S. §§ 160A-426(a), (b), & (c), -427 to -431, & -432(a), (b), (b1) & (c))

B.Residential unsafe-building condemnation power (G.S. §§ 160A- 426(a), -427 to -431, & -432(a) & (c)

C.Abatement of public nuisance (G.S. § 160A-193)

D.Minimum housing ordinance enforcement (G.S. §§ 160A-441 to -446)

E.General ordinance-making power (G.S. § 160A-174)

F.Abandoned structure ordinance (G.S. § 160A-441, 2nd ¶)

G.Demolition by neglect (historic preservation) ordinance (G.S. § 160A-400.14(b))

II.Features of nonresidential unsafe-building condemnation power (G.S. §§ 160A-426(a), (b), & (c), -427 to -431, & -432(a), (b), (b1) & (c))

A.Apparently applies to both buildings and structures that are not buildings. (Although G.S. § 160A-426 and G.S. § 160A-427 refer only to buildings, §§ G.S. 160A-428, -429, and -431 all refer to both buildings and structures.)

B.Nonresidential condemnation power may be used to condemn a structure as UNSAFE in either of two situations:

(1)where structure is especially dangerous to life because of fire or because of condition of walls, overloaded floors, defective construction, decay, unsafe wiring or heating, inadequate means of egress, or other causes (G.S. § 160A-426(a)

(2)Where the structure meets all three (3) of the following criteria:

(i)The structure appears to be vacant or abandoned.

(ii) The structure is located within a community development target area.

(iii)The structure appears to be “in such a dilapidated condition as to cause or contribute to blight, disease, vagrancy, fire or safety hazard, to be a danger to children, or to tend to attract persons intent on criminal activities or other activities that would constitute a public nuisance.”

(G.S. § 160A-426(b)).

B.Community target area means:

(1) A nonresidential redevelopment area under the Urban Redevelopment Law (G.S. § 160A- 503(10) (at least 50% of the buildings in the area are of substandard character described and substantially contribute to the condition of the area),

OR(2)an area that has characteristics of a development zone under G.S. § 105-129.3A (one or more census tracts or block groups, in city with a population of more than 5,000, area must have a population of 1,000 or more),

OR(3)an area “with similar characteristics designated by the city council as being in special need of revitalization for the benefit and welfare of its citizens.” Query: May the city council under this authority designate a single parcel as a qualifying “area”?

III.Features and procedures common to both nonresidential and residential condemnation under unsafe building statutes

A.Condemnation power designed to be more drastic and the process for exercising more accelerated than authority for enforcing property maintenance codes (i.e., minimum housing, abandoned structure ordinances). Query: Do North Carolina cities have adequate enabling authority to adopt a commercial maintenance code?

C.Unsafe building statutes require no local ordinance to implement. Problem: Unfortunately, no set of systematic hazard standards in State Building Code or in local ordinance to guide inspector's discretion.

D.Unsafe building statutes provide more rapid timetable for removing hazard than property maintenance codes

1.Placard-first approach.

a.Condemnation placard posted before a hearing is held and before owner directed to take prompt corrective action.

b.Placarding states that condemned building is unsafe and dangerous.

c.Except in an emergency, inspector apparently may not order vacation of the building before the hearing is held.

d.Apparent purpose of placard to publicize the condition of the property, thereby discouraging occupancy of building, thus encouraging owner to take corrective action quickly or to press for a hearing as soon as possible.

2.Notice of Hearing

a.The owner (undefined) must be given notice. b. Requires owner to be given written notice by

i.Certified or registered mail to last known address, or

ii.Personal service

c.Actual notice is not a substitute for notice required by statute. See Newton v. City of Winston-Salem, 92 N.C. App. 446, 374 S.E.2d 448 (1988).

d.If name or whereabouts of owner cannot after due diligence be discovered, notice may be provided by

aa.Posting of property 10 days in advance

bb.A single newspaper notice, week of hearing. (G.S. § 160A-428)

See Farmers Bank v. City of Elizabeth City, 54 N.C. App. 110, 282 S.E.2d 580 (1981)(summary judgment for city not authorized where question of reasonable diligence in locating interested parties remained); Yates v. Jamison, 782 F.2d 1182 (4th Cir. 1986)(alleged negligence of city inspectors in failing to research public records adequately to ascertain correct address of owners).

e.Problem: No provision for notice by publication or posting of property if owner refuses or fails to accept service by registered or certified mail (see Newton). Compare with G.S. § 160A-445(a1) (service by publication authorized if owner refuses to accept certified or registered mail under minimum housing statute)

f.Problem: No statutory provision for giving notice in emergencies or exigent circumstances.

3.Hearing

a.Requires hearing to be held no less than 10 days from notice date. Problem: if notice is mailed any distance or if there is delay in personal service, owner may not receive notice in time.

b. Hearing held “before the inspector.” Problem: Is hearing fair if conducted by party whose determination that structure is hazardous is at issue?

4.Order

a.If property hazardous or dangerous, inspector may order owner to "remedy the defective conditions by repairing, closing, vacating, or demolishing . . . or taking other such necessary steps . . . as the inspector may prescribe."

i.Note: Inspector is apparently not required to provide owner with an election of compliance steps (i.e., repair, close, or demolish). Coffey v. Town of Waynesville, 143 N.C. App. 624, 547 S.E.2d 132 (2001) (demolition order upheld, based upon length of time property was in unsafe condition and the unlikelihood owner would actually take sufficient steps to improve property).

ii.Compare with minimum housing statutes (G.S. 160A-443(3)) that imply an election of remedy must be provided owner. Further, under minimum housing, if a demolition order, must give owner option of repairing even if repair is economically infeasible. See Horton v. Gulledge, 277 N.C. 353, 177 S.E.2d 885 (1970).

iii.No express requirement that demolition remedy be reserved for situations where cost of repair is relatively high in comparison to value of structure as required under minimum housing statutes ( G.S. 160A-443(3); Horton.

b.Note also case law that abatement of a nuisance may be ordered only if less drastic measures are inadequate. Horton; Hickory v. Railroad, 146 N.C. 527, 60 S.E. 413 (1908).

c.Order must direct that corrective action be taken within a period, not less than 60 days, as inspector determines. May direct action be taken more quickly if “imminent danger of life or other property.” G.S. 160A- 429

5.Appeal

a.May be taken to city council within 10 days (G.S. § 160A-430).

b.In absence of such an appeal, the order is final.

c.Note provision in G.S. § 160A-434 authorizing appeals of determinations by building inspector to N.C. Dep't of Insurance "(u)nless otherwise provided by law," is apparently inapplicable since G.S. § 160A-430 does in fact provide otherwise.

d.City council sits as a quasi-judicial body in hearing appeal. Coffey

IV.Remedies and Liens

A.Failure to comply with inspector's order is a Class 1 misdemeanor (G.S. § 160A-431).

B.For both nonresidential and residential section 426(a) property (traditional unsafe building authority), city, "in addition to or in lieu of any other remedies, may initiate any appropriate action or proceedings to prevent, restrain, correct, or abate the violation or to prevent the occupancy of the building or structure involved." (G.S. § 160A-432(a)). Problem: Language above appears to allow city to use any equitable action or proceeding already available, but apparently does not expressly add additional condemnation remedies (such as power to abate hazards summarily without court order). Compare with G.S. § 160A-426(b) below. But process perhaps may be coupled with action to abate public safety nuisance under G.S. § 160A-193.

C.For nonresidential section 426(b) property (community development target area property), express summary authorization for city to “cause the building or structure to be removed or demolished.” Note: such summary abatement or demolition is also authorized under minimum housing statutes (G.S. § 160A-443(5) & (6) and public health or safety nuisance statute (G.S. § 160A-193).

D.For both nonresidential and residential section 426(a) property (traditional unsafe building authority), no special lien for demolition or removal authorized by statute

E.For nonresidential section 426(b) property (community development target area property), special statutory liens for “amounts incurred in connection with the removal or demolition” are available

(1)G.S. § 160A-432(b) authorizes lien for costs against real property upon which cost incurred that is to be filed, have the same priority, and be collected in same manner as special assessment lien.

(2)G.S. § 160A-432(b1) authorizes lien for costs against “any other real property owned by the owner of the building or structure and located within the city limits or within one mile of the city limits, except for the owner’s primary residence. Lien works like a section 432(b) lien, except that this additional lien is inferior to all prior liens and shall be collected as a money judgment.

F.Problem: No provision for notifying, holding hearing for, or ejecting tenants from condemned section 426(a) building. (No need for such provision for condemned section 426(b) property since property must be vacant or abandoned to qualify.)

G.Problem: No provision for selling salvageable materials and crediting proceeds against demolition costs for section 426(a) property. Compare with G.S. § 160A-432(b), applicable to section 426(b) property (city must sell salvageable materials and any personal property, fixtures, or appurtenances and credit proceeds of sale against demolition costs). See Newton.

V.Disadvantages of Using Summary Abatement Proceedings

A.Summary proceedings generally suffer from lack of judicial review and authorization before various corrective actions are taken.

(1)Lack of judicial authorization for nature and extent of abatement remedy.

(2)Lack of judicial authorization for manner in which owner is notified of demolition or removal action

(3)Lack of judicial authorization for “seizure” when building demolished or moved.

B.Possible tendency to use demolition or repair remedies of building condemnation law (appropriate for public safety problems) to address nuisance problems caused by the way the property is being used (often public health and welfare matters). See City of Minot v. Freelander, 426 N.W.2d 556 (N.D. 1988) (upholding demolition of building with only moderate structural deficiencies; judicial concern over filthy conditions of building and owner's apparent unwillingness or inability to clean it up).

VI.Constitutional Issues

A.Taking of private property without the payment of just compensation

1.Owner of property is not entitled to compensation for property rightfully destroyed or damaged by a city in abating a nuisance if the action is that necessary to achieve a public health or safety purpose. Rhyne v. Town of Mount Holly, 251 N.C. 521, 112 S.E.2d 40 (1960); Privett v. Whitaker, 73 N.C. 554 (1875).

2.A municipality is liable for impairing, removing, or destroying property, ostensibly in the abatement of a nuisance, if the thing or condition is in fact not a nuisance. Rhyne (violation of town weed ordinance did not justify city's clearing property of all trees and other vegetation); Privett.

3.Measure of damages is the difference between the property's market value immediately before and after the abatement action. Rhyne.

B.Procedural due process

1.Except in an emergency, the owner must be given adequate notice before the city destroys or closes a building, a hearing with an opportunity to be heard, and a reasonable time to repair or remove the building. Horton. City may summarily demolish building without a hearing only if the building constitutes an imminent danger to the public, creating an emergency necessitating the building’s immediate demolition such that the owner could not be provided notice and a hearing without endangering the public. Imminent danger present if building on verge of falling onto a sidewalk frequented by pedestrians or where the destruction of the building is necessary to stop or control a large destructive fire. Monroe v. City of New Bern, 158 N.C. App. 275, 580 S.E.2d 372 (2003), rev. den., 357 N.C. 461, 586 S.E.2d 93 (2003) (house worthy of demolition but boarded up did not pose imminent danger such that city could dispense with notice to owner before demolition under G.S. § 160A-193, the public nuisance statute). See also Harris v. City of Akron, 20 F.3d 1396 (6th Cir. 1994)(demolition of owner's building without prior notice, pursuant to emergency procedures of city code, did not violate owner's due process rights where predeprivation process is impractical). Cf. Yates v. Jamison, 782 F.2d 1182 (4th Cir. 1986.

2.City is liable for the destruction or demolition of a building if due process requirements not observed. Monroe; Newton.

C.Fourth Amendment right to be free from unreasonable searches and seizures

1.Search to inspect building or potential nuisance site is subject to Fourth Amendment and requires occupant's consent, a warrant, or exigent circumstances. Hroch v. City of Omaha, 4 F.3d 693 (8th Cir. 1993; Conner v. City of Santa Ana, 897 F.2d 1487 (9th Cir. 1990), cert. denied, 498 U.S. 816 (1990).

2.Warrant or consent not required to abate a nuisance in an open field or in an area where owner has no reasonable expectation of privacy. Schneider v. County of San Diego, 28 F.3d 89 (9th Cir. 1994) (warrant not required to seize junked buses and vehicles in field next to residence owned but not occupied by plaintiff because no reasonable expectation of privacy), but see Soldal v. Cook County, 506 U.S. 56, 121 L.Ed2d 450, 113 S.Ct. 538 (1992) (holding that dispossession of real property is a seizure for purposes of the Fourth Amendment).

3.The issuing of demolition or abatement order by a court or the judicial review of an administrative demolition or abatement order is sufficient to dispense with need for warrant if property actually seized, demolished, or abated.

4.Administrative demolition or abatement order is also apparently sufficient to dispense with need for warrant if property seized, demolished, or abated. Compare Freeman v. City of Dallas, 242 F.3d 642 (5th Cir. 2001), Samuels v. Meriwether, 94 F.3d 1163 (8th Cir. 1996), and Hroch (warrant unnecessary when a city demolishes buildings declared to be nuisances pursuant to authorized police-power procedures) with Conner (suggesting that administrative condemnation or seizure order may not be implemented without a judicial warrant.)