Joseph Padilla (#005925)

Joseph Padilla (#005925)

Nancy E. Campbell (#015398)

MESA CITY ATTORNEY'S OFFICE

P.O. Box 1466

Mesa, Arizona 85211-1466

Telephone: (480) 644-2343

Attorneys for Plaintiff

SUPERIOR COURT

MARICOPA COUNTY, ARIZONA

MESA, a municipal)

corporation,)NO. CV 2001-090422

)

Plaintiff,)PLAINTIFF’S RESPONSE TO

vs.)DEFENDANT’S MOTION FOR

)SUMMARY JUDGMENT AND

RANDALL E. BAILEY and MELISSA M.)PLAINTIFF’S CROSS MOTION

BAILEY, husband and wife; DALE I. BAILEY )FOR PARTIAL SUMMARY

and JANET L. BAILEY, husband and wife; )JUDGMENT

COUNTY OF MARICOPA, as to any unpaid)

real property taxes; JOHN DOE 1 to 10; JANE)(Assigned to the Honorable

DOE 1 to 10; BLACK CORPORATIONS 1 to)Robert D. Myers)

10; BLACK PARTNERSHIPS 1 to 10;)

UNKNOWN HEIRS AND DEVISEES OF ANY) (Oral Argument Requested)

DEFENDANTS WHO ARE DECEASED,)

)

Defendants.)

)

Plaintiff, the City of Mesa (hereafter, “Mesa”), by and through counsel undersigned, hereby responds to Defendant, Randall E. Bailey’s, et. al. (collectively, “Bailey’s”), Motion for Summary Judgment, and respectfully requests this court grant Mesa’s Cross Motion for Partial Summary Judgment leaving only the issue of just compensation for trial in accordance with the provisions of Ariz. R. Civ. P., Rule 56, on the grounds that there is no genuine issue, except the just compensation issue, as to any material fact and that Mesa is entitled to judgment as a matter of law.

This Response to Bailey’s Motion for Summary Judgment and the grounds underlying the Cross Motion for Partial Summary Judgment are set forth in the Plaintiff’s Memorandum of Points and Authorities, Greg Marek’s Affidavit, and the Statement of Facts and required Exhibits filed separately in accordance and Local Rules of Practice of the Superior Court in Maricopa County, Rule 3.2.

DATED this 19th day of February 2002.

CITY OF MESA

By: ______

Joseph Padilla

Nancy Campbell

Attorneys for Plaintiff

MEMORANDUM OF POINTS AND AUTHORITIES

I.Introduction.

Bailey’s Motion for Summary Judgment is essentially an attempt to attack the constitutionality of the redevelopment statutes, A.R.S. §36-1471 et. seq. Bailey’s main grievance is with the latitude allowed a municipality under the redevelopment statutes in declaring a redevelopment area. In fact, Bailey’s own expert admits that Mesa followed the redevelopment statutory process. Instead, Bailey is upset with the result of that statutory process, a grievance more appropriately brought before the Arizona state legislature, not this court.

The only relevant issues before this court are: 1) whether redevelopment is a public use; 2) whether there is any evidence present to support the city council’s findings and conclusions that necessity existed for the condemnation of Bailey’s property as part of the redevelopment project; 3) whether certain city council members had a conflict of interest that tainted their votes regarding the redevelopment designation; and 4) whether Mesa followed the statutory procedure for the redevelopment designation. Assuming all undisputed facts in the light most favorable to Mesa, Bailey cannot prevail on its Motion for Summary Judgment; thus, it must be denied.

Moreover, assuming all undisputed facts in the light most favorable to Bailey, none of Bailey’s counterclaims 1 (conflict of interest), 2 (due process), 3 (unconstitutional use of eminent domain), and 4 (bad faith and arbitrary and capricious conduct) nor any of Bailey’s defenses can be supported by law; hence, partial summary judgment leaving only the issue of just compensation for trial is proper.

1. Procedural History and the Statement of the Case.

A.Procedural History

On July 30, 2001 Mesa filed its First Amended Complaint requesting, interalia, that the Bailey property be condemned and that just compensation be determined. On October 23, 2001, Bailey filed its Answer and Counterclaim against the City. On February 11, 2002, Bailey filed a Motion for Summary Judgment resulting in this Response and Cross Motion.

B.Statement of the Case

Until May 1999 redevelopment efforts were conducted under a redevelopment plan that was approved by the city council in 1996. (See Separate Statement of Facts (hereafter, “SOF”) #s 1 and 2.) In 1997, redevelopment personnel began to investigate the possible expansion of the 1996 redevelopment plan to incorporate property on both sides of the four major arterial streets that defined the boundaries of the 1996 redevelopment area. Towards that end, redevelopment personnel began conducting studies and analysis in which they performed field work, obtained fire, crime and other statistics from the Police and Fire stations, and worked closely with the Mesa Town Center Corporation to ascertain those areas in Mesa most in need of redevelopment. (SOF #s 3 – 9.)

Redevelopment personnel incorporated all its field work and findings into a report called the Town Center Redevelopment Plan (hereafter, “the Plan”). (SOF # 10). Public hearings were conducted and the city council held meetings at which the redevelopment personnel provided oral and written reports to the city council. In addition, at these city council meetings, the Plan was presented to them along with information obtained at the public hearings. In addition to the reports and presentations, city council members relied on their familiarity with the properties in the town center redevelopment area, their personal knowledge of the building conditions, dilapidation and deterioration of parcels within the proposed redevelopment area, as well as their personal observations of the building and other conditions located within the proposed area. (SOF #s 11-13.)

On March 15, 1999 the city council approved Resolution 7336, finding and

declaring the necessity of redevelopment in the redevelopment area and approved

Resolution 7337, which approved the Plan. (SOF #14.) On September 16, 1999, the city council approved Resolution 7426, establishing Site 24, as a 5.22-acre Redevelopment Project Site. After designating Site 24 as a Redevelopment Project Area, public hearings were held to discuss the issuance of requests for proposals for developers. (SOF #s 15-20.) At a public meeting on November 20, 2000, the city council approved Resolution 7590, which authorized Mesa to enter into development agreements and to acquire and assemble the properties necessary for the Redevelopment Project. (SOF #21.)

When the issue of expanding the Town Center Redevelopment Area and approving the Plan came before the city council, council member Bill Jaffa declared a potential conflict of interest because he had an ownership interest in a property located in the Town Center Redevelopment Area and he performed accounting services for businesses in the Town Center Redevelopment Area. Council member Pat Pomeroy declared a potential conflict of interest because his brother owned a building in the Town Center Redevelopment Area at 136 West Main Street. Former Mayor Wayne Brown declared a potential conflict of interest because his brother had a business interest in an auto dealership near Main and Sirrine Street, within the Town Center Redevelopment Area. Council member Keno Hawker declared a potential conflict of interest because he owns an asphalt business located within or near the Town Center Redevelopment Area. (SOF #22.) The city council members were instructed to vote after declaring the potential conflicts under the direction and advice of city attorney Neal Beets. (SOF # 23.)

After the city council approved the Town Center Redevelopment Area boundaries, city council members no longer declared conflicts of interest, when considering matters dealing with the designation of the Site 24 boundaries and the Redevelopment Project as none of the Council members had an interest at ant relevant time in any of the property that was to be part of the Redevelopment Project in Site 24. (SOF #24.).

1. Standard for Summary Judgment.

Where there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law, summary judgment is proper. Ariz. R. Civ. P., Rule 56(c); OrmeSchool v. Reeves, 166 Ariz. 301, 802 P.2d 100 (1990). The court should grant summary judgment if the facts produced in support of the claim or defense have so little probative value, given the quantum of evidence required, that reasonable people could not agree with the conclusion advanced by the proponent of the claim or defense. Id. at 166 Ariz. at 309, 802 P.2d at 1008. Therefore, the trial judge is to use the same standard as used on directed verdict. Id.

1. Statement of Law.

A.Public Use: Redevelopment is a Public Use.

1.Whether a particular use is a public use is to be decided judicially.

The Arizona Constitution, Article 2, § 17 requires that when property is taken for “a use alleged to be public, the question whether the contemplated use be really public shall be a judicial question, and determined as such without regard to any legislative assertion that the use is public.”[1]

While there is no formula for determining whether the purpose for a taking constitutes a public use, Arizona courts look to the Arizona Constitution, statutes, local ordinances and other statements of public policy in the process of determining what constitutes public use. Under Article 2, § 17, legislative findings of public use are not conclusive, although reviewing courts are to give them great weight. Humphrey v. CityofPhoenix, 55 Ariz. 374, 102 P.2d 82 (1940). In Arizona, the legislature has asserted that acquisition of property pursuant to the redevelopment provisions “are public uses and purposes for which public money may be expended and the power of eminent domain exercised.” A.R.S. § 36-1472(4).

The U.S. Supreme Court has recognized the propriety of state court decisions regarding the judgments of the state courts upon what should be deemed public uses. The Supreme Court has never held a use to be private, which the courts of a state, with their intimate knowledge of local conditions and requirements and with the concurrence of the legislature or even of the people of the state, have declared to be public. 2A Nichols, Eminent Domain § 7.05[1] (3rd Edition 1981.)

2.Arizona courts decide public use on a case-by-case basis.

While there is no formula for determining whether the purpose for a taking constitutes a public use, two approaches have generally been used by courts across the country: one approach is to declare a public use where there is “public enjoyment” or “actual use by the public” of the property, and the second, more expansive approach is to declare a public use if there is some “public advantage or benefit” resulting from the condemnation. 26 Am.Jur.2d, Eminent Domain, §§ 49-60.

In Arizona, courts have repudiated the narrow view. CitizensUtilitiesWaterCo. v. SuperiorCourt, 108 Ariz. 296, 298, 497 P.2d 55, 57 (1972), cert. denied, 409 U.S. 1022 (1972)(repudiating the narrow view); Inspiration Consol. Copper Co. v. New Keystone Copper Co., 16 Ariz. 257, 144 P. 277 (1914) (“In a great number of these [condemnation] instances there is no participation by the general public, and the public use consists in the purely incidental benefits.”)

The determination of what is a public use is determined on a case-by-case basis. Citizens Utilities Water Company of Arizona v. Superior Court in and for the County of Pima, 108 Ariz. 296, 497 P.2d 55 (1972). This view is also consistent with the Arizona State Constitution. Art. 2, § 17 of the Arizona Constitution states:

Whenever an attempt is made to take private property for a use alleged to be public, the question whether the contemplated use be really public shall be a judicial question, and determined as such without regard to any legislative assertion that the use is public. (emphasisadded.)

Arizona courts are moving towards the broad view of public use by holding in several different cases that public use includes: use by the public, public benefit, public advantage or convenience, promoting the public welfare or promoting the general objects and purposes of the governmental entity. See Kerrick, Robert. “What Constitutes Public Use and Necessity?” Eminent Domain in Arizona, attached as Appendix A.

1. Mesa’s exercise of eminent domain is proper.

Under A.R.S. § 36-1473, the legislature has expressly conditioned a municipality’s exercise of the power of eminent domain upon adopting a resolution that a redevelopment area exists in the municipality and that the redevelopment of that area is necessary in the interest of the public health, safety, morals or welfare of the residents of the municipality.

Absent a violation of the United States Constitution, Article 2, § 17 is the only limitation of the power of the state to condemn private property. Municipal corporations, on the other hand, are creatures of the state and have only such powers as the state delegates to them, or as

granted them by the state constitution. City of Tempe v. Fleming, 168 Ariz. 454, 815 P.2d 1 (App. 1991); City of Phoenix v. Donofrio, 99 Ariz. 130, 133, 407 P.2d 91, 93 (1965).

Mesa has been granted the power of eminent domain to by means of several statutes and by means of the City’s charter.[2] The Arizona legislature has delegated to Mesa the power to condemn private property through the eminent domain statutes, A.R.S. § 12-1111 et. seq. A.R.S. 12-1111 lists the purposes for which municipalities may exercise the power of eminent domain. A.R.S. § 12-1111(2) provides:

Subject to the provisions of this title, the right of eminent domain may be exercised by the state, a county, city, town, village, or political subdivision, or by a person, for the following uses:

* * *

2. Buildings and grounds for any public use of the state and all other public uses authorized by the legislature. (emphasis added.)

One such authorization by the legislature is contained in Arizona’s redevelopment statutes. A.R.S. § 36-1471 et. seq. Specifically, A.R.S. § 36-1474 and 36-1478 provide that municipalities are empowered to acquire property for “redevelopment project[s].” A.R.S. §§ 36-1474(1); 36-1478(A); City of Mesa v. Smith Company of Arizona, Inc., 169 Ariz. 42, 44, 816 P.2d 939, 941 (1991); Cordova v. CityofTucson, 15 Ariz. App. 469, 489 P.2d 727 (1971); 16 Ariz. App. 447, 494 P.2d 52 (1972)(slum clearance, community redevelopment, and historic preservation are all public uses). A.R.S. § 36-1473 authorizes Mesa to use eminent domain only in those cases where the city council has found both a redevelopment area exists within Mesa and that redevelopment of the area is necessary.

[1] Art. 2, § 17 of the Arizona Constitution states:

Whenever an attempt is made to take private property for a use alleged to be public, the question whether the contemplated use be really public shall be a judicial question, and determined as such without regard to any legislative assertion that the use is public. (emphasisadded.)

[2]Mesa City Charter, Art. 1, Section 101, a home rule charter pursuant to its authority under Arizona law, adopted by a vote of its residents, and approved by the governor of the State of Arizona, contains the following provisions:

… “Mesa” shall continue to be a body politic and corporate, with all powers possible under the constitution and general laws of Arizona as fully as though they wereenumerated in this Charter, and all the rights and powers granted or to be granted to Charter cities and towns incorporated under the provisions of Title IX, A.R.S., and these further rights and powers,to wit: (A) To acquire bypurchase, condemnation or otherwise, and to lease, within or without the City, land or other property necessary to establish and operate any lawful municipal function.