Monday, May 18, 2009

Arizona Proposition 207 Claim, or Bluster?

A local zoning attorney this past week admonished a city council not to revert the zoning classification on his client owner’s parcel, since that would be tantamount to “down-zoning” the property, diminishing the value of that asset, and triggering the tenets of Proposition 207, Arizona’s regulatory takings measure. (This has been since its passage codified in A.R.S. §12-1134.) My reaction is this: What’s the real story, here?
A well drafted city or county zoning ordinance should contain a section explaining the intent and form of conditional zoning provisions. If the text contains an automatic “repealer” clause, which provides that the zoning reverts back to the original zoning if the conditions are not met within a set time limit, the specific time limit should be included. When this form is to be used, it’s advisable for notice to be given and a public hearing conducted on the scheduled repeal, to avoid a possible challenge on procedural due process grounds. If the text’s substance is that the zoning becomes effective only upon specific conditions being met within a prescribed time limit, then the time limit should be specified in the ordinance, and definite standards for compliance should be provided. All of this makes good land planning sense.

But once that policy is articulated and the reversion process is properly implemented, well, where’s the owner’s gripe? If a project that has been rezoned languishes without serious progress, and if the applicant for the original zoning was made aware of the stipulation governing a limited opportunity to accomplish the development, how do we empathize with the objection to repealing the conditional grant? To elaborate, what’s the more consequential public policy? Is it to recognize that repealing the zoning granted will potentially harm the marketability (or financial yield upon sale) of the parcel in question? Or, is it to acknowledge that over time, the surrounding neighborhood or other geographic context can transition, and that this change might render the adopted conditional zone incompatible with what’s going on around the parcel? Is it not the case that some applications for zoning changes are compelling only when the development accomplishes some specific, beneficial purpose in the near term?

Granted, if only a single parcel in a jurisdiction is designated for repeal of its conditional zoning, substantive due process may be implicated, unless it is demonstrable that the specific parcel was rezoned in a difficult decision that featured several competing considerations. But if a zoning authority consistently enforces the “rule of reversion,” then blustering by the owner is overboard. What’s wrong with losing your zoning when you were told, and you acknowledged, the ‘use it or lost it’ stipulation in the zoning ordinance that the council or commission voted to approve? (And, by the way, why isn’t a proper reversion clause in a zoning ordinance consistent with A.R.S. §12-1134(B)(6)?)

When the owner is truly ready to develop, assuming the neighborhood has not evolved in a different direction, the owner won’t have any difficulty obtaining his parcel’s “reinstatement” of the needed zoning district. Conversely, if the neighborhood no longer is the same “place” it was before the reversion, then why would anyone - parcel owner included - want to have the entitlement to develop out of synch with the surrounding uses?


Thursday, May 14, 2009

Watch What You’re Writing, Consultant!

Once in a while there’s an appellate court decision that makes you scratch your head, or makes your heart skip a beat. I read an opinion last week that did both. In Sage v. Blagg Appraisal Company, the Arizona Court of Appeals suggests that if you are:

--a professional consultant (you have a license or certificate to practice your profession), and
--you produce a report in writing for a client or customer under a written contract to do so, and
--you have reason to know that someone else might see the report, whether or not this is someone you have met, heard of or even know exists, then if you make an misstatement of fact or draw an incorrect conclusion in that report, as a result of failing to use “reasonable care,” you could be liable to that someone else.

There’s an eye-opener! In this opinion, we’re told that an appraiser performed a bank appraisal for a loan after a purchaser signed a contract to buy a residence. The purchase contract made the sale contingent on there being a sufficiently high valuation of the residence. So, the report was done, the appraisal came in sufficiently high to support the loan, and the transaction closed. And, as we know, the real estate market then collapsed.

The bank was the customer of the appraiser, who did not know and had not met the purchaser. The evidence at the trial court level was that the borrower/purchaser may not even have read the appraisal report, other than the noticing the opinion of value. Some time later, the purchaser decided that the house was no longer worth the purchase price; and in retrospect, she discovered that the opinion of value was based upon an error in the calculation of the square footage - the appraisal was higher than the square footage of the house supported. The purchaser sued the appraiser, and the trial judge dismissed the suit because, he opined, the purchaser was not in the concentric circle of persons who foreseeably would rely upon the opinion of value. In part, the trial judge may have been influenced by the disclaimers in the appraisal – particularly, that no one other than the bank (customer) could rely on the information or expressed opinion of value.

The Court of Appeals has a different view of the significance of those disclaimers – that they are meaningless (they don’t even put another party on inquiry notice) – and the ambit of forseeability (that sense of whom is foreseeable that can be inferred from “circumstances” that the appraiser may or may not be aware of). In this case, the circumstance was the existence of a federal statute that required a lender to share the work product of the appraiser if the borrower asks to see it. (So the appraiser knew that there was some probability that the borrower might ask for a copy, admittedly.) The Court has contradicted a previous (2004) opinion of the other appellate division, called Kuehn v. Stanley, in reaching this conclusion.

I want to be fair in stating that the holding of the Court was explicitly limited to the case where a lender-retained appraiser performs a valuation in connection with a “purchase-money” mortgage sought by a prospective home buyer of the appraised residence; in that instance, the appraiser has a duty of care to the buyer herself in performing his work. Likely the Court panel really did want the decision to govern the behavior of residential appraisers who might be inclined to work too quickly—and, therefore, perhaps too carelessly—in doing a high-volume business in a “hot” residential market. (And, rumor has it, some in the appraisal trade are sanguine about a decision infusing accountability into the appraiser fraternity membership.) But it’s disturbing when logic is applied to marginal cases, achieving a particular result. Those elements of logic migrate, like corpuscles in the capillaries, from the margins to the mainstream, starting with the peculiar little situations that cry out for an equitable outcome, until they affect major legal principles like the reach of the duty of care in negligence cases of statewide significance.

I’m concerned about this opinion because I intend for others to read these blog posts. In fact, I hope someone reads this one, and soon – I don’t pretend that my ego isn’t boosted by attention. But the reason that there are disclaimers on the site where Patrick and I post is because we know from the outset that “one size doesn’t fit all” – so we don’t want anyone taking what we say too seriously about real estate or investments generally having any application to the reader’s own life conditions. But what if someone reads a post, and decides “gee, this guy sounds like he’s on target here,” and conducts herself in a manner suggesting she’s relying on the observations of these posts’ writers. Is my intention to be read enough to create a duty never to state anything incorrectly here?

Honestly, it’s absurd to read blog posts and make important decisions on the basis of untested statements of facts (and their interpretations, aka “spin”) and opinions. But neither Patrick nor I can control what you do, good readers. What if you do act based on something you read here? Are the ‘blogistas’ liable if our conclusions or points of view do not lend to your improved wealth, contentment or enlightenment?

The fortunate circumstance of blogging-authorship is that we who write are not directly compensated by our readers for our ‘Net-musings. But are we treading upon a slippery slope? What happens if an Arizona court later were to say, “well, it was forseeable that a reader might view your experience, evidenced in your posts, as attention- worthy and might find your words reliable enough--and they were damaged for applying your outlook to their particular situations. Really, you do intend for them to be impressed by your knowledge of [what have you], or you wouldn’t blog to begin with, right?” What then? Should professionals stop blogging?

The Sage v. Blagg Appraisal Company decision may be appealed, so there’s no point in delving much into its legal analysis, except to remind you, readers, of two things. One, watch what you write, and use caution in spreading it around, if you are a licensed professional. And two, recall that free advice is worth precisely what you pay for it. (That’s my sense of the value of the majority of blog sites’ and chat rooms’ material.) Bonus: Please go back and read the disclaimers on the right margin of this terraincogito page. We mean them. Really.


Requiem in Pacem, Canis lupus familiaris

Ordinarily, I’d be amused at my own ability to assemble a Latin phrase out of two terms I know. That’s about half of all the Latin phrases I’ve learned. But here, it’s just sad. Our family’s friend, Greta, died a year ago yesterday, and we still have heavy hearts when we go into our back yard and see no evidence of her playfulness. When she was a puppy, she would haul ass across the lawn; that’s a bit crude, but if that expression ever applied to any situation, it was Greta’s. She was full-throttle as she blew through the “doggie door” and chased me or one of our daughters toward the swing set, or as she fruitlessly pursued some lizard sunning against the wall or mourning dove perched in the grass.

The past year finds me wondering what it is we love so much about domestic, 4-legged, winged or finned companions. That’s partly due to Greta’s departure and also because for the last four months I’ve been writing an article about animal welfare and human negotiations directed toward the improvement of animal treatment. Of course, there is a plethora of literature praising the nobility of our “pets,” as they used to be called (before that became politically incorrect), and the wonders of two/four legged companionship. There’s also been a movie about Marley, as we’ve all been reminded. My father had a simple explanation. He’d come home from his stressful job, walk into the living room, stare at our Daschund, shake his head and say with a scoff, “dogs are better than people,” as he headed for the bedroom to change into his leisure clothes.

I suppose the wisdom of Dad’s philosophy had something to do with one’s standards of comparison, but what strikes me is the simple profundity of this idea: it’s so hard to please other people that it’s frequently shocking when you succeed. There are so many barriers to succeeding in a “me” oriented world. In contrast, it requires relatively little to please a pet; sentient pets seem as eager to be pleased as to please us; and that fact excites and encourages us to engage in further acts that, by pleasing the pet (or appearing to) please us, too. Of course, we’re imagining the intensity of the pet’s pleasure response but, well, so what? The external factors—a wag of the tail, a mew, a nuzzling of the leg, perking of the ears in anticipation, a happy bark—are so immediate and lacking in nuance that we’re ready to repeat the behavior all over again. Talk about low maintenance! Or, hold it—have we just been well trained?


Tuesday, May 5, 2009

Seven Pillars of Learning

While this remembrance anticipates Teacher Appreciation Week 2009, I regret that I didn’t turn this in while more of my guides were still alive and teaching. Only lately, though, have I realized greatly their lessons resonate. Seven educators especially helped me in my journey. Their advice and finest intentions motivate me still.

Mrs. Colby in third grade worried that I was too flighty and predisposed to working fast, so that I could annoy the other pupils. (This was before the day of ADHD and related diagnoses.) Instead of dismissing me as incorrigible, she granted me my own bookshelf in her classroom. She put the district’s readers for the 4th through 6th grades on that shelf, and told me that once I finished my assignments in the 3rd grade reader, I could read the later grades’ books. Later, she gave me a note to hand the school librarian. I read it, and it said: “as long as Mike isn’t there when he should be in class, please let him pick out a book to read - and let me know what he’s reading.” I read a lot of books about horses, dogs and the far West, I recall. Mrs. Colby, I still disturb others, but your indulgence let me read well that much earlier and learn to enjoy words. In fact, I was a librarian for five years; and I hope I inspired one person to love reading and books. I’m glad you shipped me off to the library instead of to the principal’s office.

One day in my sixth grade class, in a disconnected moment, Mr. Meyers blurted out: “there’s something I want you to know. You can live on half of what you earn, no matter how little money you make.” At the end of that year, he left teaching. I was told that he went to work on the SS Hope, the world’s first peacetime hospital ship, along one coast of Africa. My hunch is that Mr. Meyers was talking mainly to himself, steeling against sacrifices he would make to do what he believed in. Thanks, Mr. Meyers, for being that kind of fellow who wants to matter in life. And for being right, on the money. In the fall of 1972, I lived simply, sleeping in a dump and earning the minimum wage; but I saved $400 in 3 months of honest labor. It’s soulfully liberating to know that money actually doesn’t determine your quality of life, when you stop listening to people telling you it does.

Daisybelle Elkins toiled in the seventh grade at H.W. Longfellow Intermediate, suitably-named for an English teacher’s travails. Mrs. Elkins saw that I was struggling horribly with sentence diagramming, an organizational skill she believed with all her heart to be vital to mastery of English grammar. I understood her philosophy even less than I did diagramming, but she was determined. For four agonizing weeks she coaxed me to visit her “home room” after school, where she waited for me to diagram scores of elusively-constructed sentences. She never was rewarded for her efforts. To this day, I haven’t an inkling of the difference between a predicate adjective and a predicate nominative. Candidly, I don’t grieve; these exercises seem, even now, an intellectual pleasure akin to gagging on Brussels sprouts. But I surely appreciated her patient determination and calm encouragement when I mangled another prone-position, skeletal diagram. Thanks, Mrs. Elkins, for caring about your craft and a hard-headed kid, and, by the way, my college major was English, and I graduated from a fairly tough department. Also, I don’t often leave sentence fragments on my paper (ignore the one in the preceding paragraph) or write run-on sentences (other than that last one). Who knows - maybe some of your instruction “took!”

My 10th grade English teacher, Mrs. Sokolov, gave me an “F” on my essay outline, so I complained bitterly. “You made a pretty good outline, Mike, but I told you not to write in complete sentences and to use Roman numerals and that if you had an A. in the outline, you must have a B. There are rules for outlining that have to be obeyed. Sometimes in life, Mike, you have to obey rules, and if you don’t like that, take control so you can make the rules instead.” She let me do the assignment again, however - then she marked a “C” in her grade book, triggering another bitter complaint. I protested that since I executed according to her directions, this was an injustice. “Perhaps,” she replied, “but a “C” is the average between what you got for your mark the first time and an “A” - do you know why I decided that?” I sighed, allowing that one must follow the rules the first time, which she confirmed with her penetrating stare, aimed above the low-slung rim of her half-spectacles. Mrs. Sokolov, for what it’s worth, in the 1990s, I drafted a bill introduced in both houses of a state legislature, which perished in committee. Nevertheless, the rule of law elegantly was rendered in the bill; there was, you might say, orderliness about its text. That’s your influence.

A punk in the 10th grade, I was making “F” marks and scraping by, so luckily someone noticed irreconcilably high scores on my standardized, “fill in the correct bubble” assessments. Mr. Massey was wise to me. One day he held me after, following my lame crack responding to one class-hour question. Massey gave me a bemused smile as I stood before his desk, and he said “Mr. Widener, you don’t have to embrace being dumb in order to fit in. There’s really nothing memorable in acting that way.” He gave me a brief, sad though determined stare, nodded me toward the door, and continued packing his briefcase. I still messed up in school for the rest of that year, but never again in his class (nor in Sokolov’s). I doubt you remember it, Mr. Massey, but we met each other on the Lawn at the University of Virginia six years later. (Why you were there I don’t know.) I recall I was late for class that Noontime when we passed each other, but each of us stopped suddenly and did a double-take. “What finds you here, Mr. Widener?” he asked. I explained that I was in my final semester of studies, and, responding to his “what’s next” inquiry, reported applying to graduate school. Massey smiled with his eyes, nodded quickly, and said evenly “well, imagine that.” He wheeled around and went about his business. And I mine, grateful for his critically-timed advice.

My nominal Junior and Senior year guidance counselor provided another reason I seldom messed up after Tenth grade, but not from his direct intervention. I still recall this reedy fellow, Mr. Carapace, with his short-sleeved white shirt, skinny tie with a perfunctory knot, opaque greenish horn-rimmed glasses and plastic-sleeved identification tag pinned to his pocket. I had just transferred to this school for my last two years. Marshall High awed me, this immensely-larger facility than my previous school. The campus contained a vocational-technical training center. Grudgingly in tow, I met Carapace with my mother in the cafeteria on pre-registration advisement day. We sat on hard plastic, picnic-style table seats. Tight-lipped, Carapace smirked at her: “Judging from his record these past two years, Mike seems to not have the attitude to attend a 4-year college. Perhaps he should look at the manual arts programs we offer here at Marshall, like auto mechanics or the trowel trades.” I knew Carapace was a fake from that very moment; my records proved how hopelessly inept I was at any activity that required dexterity or spatial harmonizing, confirmed by my grades in 8th grade shop class!

I shortly noticed my mom in a state of disbelief, absorbing his “counsel” about industrial vocations. Neither of my folks attended college, and a core conviction in their adult lives was to make sure their children had enough education to “get ahead” in whatever endeavor we chose. She was embarrassed for me, and maybe personally humiliated - or perhaps panicked about my shrinking, future options. My face burned in the parking lot - in shame, then anger (Sokolov and Massey were right!) and finally, determination. Carapace had landed on my list, as certainly I had on his; he never once said an encouraging word to me – nor did he need to. In no sense was he inept in his counsel. Maybe his speech was motivationally-intentioned, even though he’d never talked to me before that meeting. Yet Carapace delivered this fundamental lesson: You alone must chart your journey; no one else, including a person of authority or influence, has that prerogative. And this, related reminder: Only you are accountable for choices you make. Thanks for that instruction.

Joseph F. Kett, Ph.D., taught me in Charlottesville that studying history was not memorization of a chart of the achievements of accomplished dead men. Its payoff lies in understanding the passages (and recurring influences) of colliding principles that gradually burnish social institutions to improve, if not perfect, our order. Dr. Kett caused me to begin to understand the uses of history on a grander scale, inquiring “why that dominant idea, instead of another, and what difference did it make that the country chose that direction” – hello, social accountability! He also urged me to apply for a Rhodes scholarship in my last year of college, though his advocacy overwhelmed his judgment about one student’s acumen. Dr. Kett reminded me, as Mr. Massey did, that it’s senseless not to flex one’s mental faculties. All these teachers - and I think all fine teachers today - share this capacity: to imagine their students better than they encounter them, and invite them to reach their highest potential. Mine helped reinvent me, in modest but permanent ways. Such treasures!

Michael N. Widener passed through Fairfax County (VA) public schools before reaching Phoenix, where he practices, blogs about, and teaches law.