Property Law Developments—Joseph William Singer

An evenly-divided Supreme Court of New Jersey affirmed a lower court’s opinion that protected the potential parental rights of a surrogate mother who had been implanted with the sperm of a man and the egg of an anonymous donor and denying the right of the man’s wife to have her name placed on the birth certificate with her husband’s at the time of birth of the child even though it was contingent on the surrogate mother’s right to change her mind up to 72 hours after the birth of the child. In re T.J.S., 2012 WL 5233616 (N.J. 2012), aff’g In re T.J.S., 16 A.3d 386 (N.J. Super. Ct. App. Div. 2011). The state statute affirms the potential parental rights of the sperm donor and the biological mother who gives birth to the child, as well as the egg donor. The statute protects the rights of the biological mother to retain parental rights (even if the egg is donated by someone else) unless she relinquishes those rights in an approved manner; the statute requires adoption by the mother who is not biologically related to the child while recognizing the sperm donor’s rights as father because of his biological connection to the child.

Although the state statute allows the husband’s name to be placed on the birth certificate of a child born by his wife even if she is impregnated with the sperm of a third-party donor, the court did not find a constitutional equal protection violation when it denied that right to the infertile wife in this case. In effect, the court thought there was a rational reason to make it easier for sperm donors to relinquish parental rights than for surrogate mothers to do so; conversely, it saw reason to place parental obligations on husbands regardless of a biological connection to a child born by their wives while denying parental rights and obligations for wives who have children through a surrogate mother.

The three dissenters found such a distinction to violate the equal protection clause of the constitution by granting the husband the right to immediate parental status despite lacking any biological connection to the child while denying that right to the wife over a child biologically connected to her husband, especially when the birth certificate explicitly made the wife’s parental status contingent on the waiting period that allowed the biological (surrogate) mother to change her mind.

The case implicates property issues because the parental/child relationship not only confers rights on the child but obligations on the parent so who the parent is defines who has obligations to support the child, thus encumbering the parent’s property to comply with those obligations.

Arkansas Game & Fish Comm’n v. United States, 637 F.3d 1366 (Fed. Cir. 2011), held that deviations by the Army Corps of Engineers from a flood management plan that resulted in temporary flooding of riverfront property did not constitute a taking of property without just compensation but might constitute a tort for which compensation could be sought. The flood management plan exists because the riverfront property is subject to flooding in the first place and it is intended to alleviate that. The doctrinal issue likely to be the focus of the Supreme Court’s ruling is whether temporary flooding constitutes a taking of property.

Koontz v. St. Johns River Water Management District, 77 So. 3d 1220 (Fla. 2011), held that the state of Florida did not take the landowner’s property when it proposed to allow the owner to dredge the property on condition that several exactions were met. The owner refused the exactions and the permit was ultimately denied. The core question is whether the Nollan/Dolan rule requiring exactions to be substantially related to the reasons for the permit denial apply to exactions that do not involve a dedication of the owner’s property to the public. Nollan and Dolan both involved governmental proposals to relax regulatory limits on land development in exchange for the owner granting a public easement of access to portions of the owner’s property. The Supreme Court in Lingle v. Chevron U.S.A., Inc., 544 U.S. 528, 547-548 (2005), explained that this constituted a particular application of the unconstitutional conditions doctrine. The Supreme Court may finally resolve the question of whether Nollan/Dolan doctrine applies, for example, to municipal rules that relax zoning limits if developers contribute money to a fund to promote low-income housing. Or the court may find the case moot and the doctrine inapplicable given the ultimate denial of the permit in this case.

The New York Court of Appeals has held that a loft owner who has not complied with regulations designed to ensure that lofts are habitable cannot collect rent or evict the residential tenant from her home. Chazon v. Maugenest, 971 N.E.2d 852 (N.Y. 2012). In one sense this is a straight-forward application of modern landlord/tenant law. The case is unusual because the tenant has been living in the loft without paying rent for nine years and because the tenant’s initial occupation was illegal since the property had been formerly used for commercial purposes and rented to a residential tenant in violation of New York City ordinances. The Court felt it had no discretion given the clear language of the loft law. That law had been intended to induce loft landlords to upgrade the property to make it habitable but hundreds of such landlords have still not complied with it despite the fact that it has been in effect for 30 years. The court held that the clear language of the loft law would apply even if the landlord’s violations were procedural rather than substantive.

The Massachusetts Appeals Court reaffirms that, unlike residential landlords, commercial landlords have no duty to repair the leased premises in the absence of a contractual obligation to do so. Marino v. Mystic Realty Trust, 2012 WL 4033738, 82 Mass. App. Ct. 1113 (Sept. 14, 2012). The opinion applied established Massachusetts law. Humphrey v. Byron, 850 N.E. 2d 1044 (Mass. 2006). A consequence of this no duty rule is that commercial landlords owe no duty to exercise reasonable care to assure that visitors are not subject to unreasonable risk of harm while on the leased premises. Commercial landlords do have a duty to maintain common areas and thus must protect visitors from unreasonable risk of harm there.