Property Rights Foundation of America®

Speech from the Eighth Annual New York Conference
on Private Property Rights


A National Model

By Craig M. Call

We are going to say the world changed in Utah seven years ago, and I guess I am still amazed. There was a time when the Legislature of Utah, as a result in part of the Defenders of Private Property and the national effort to try to get legislation in place that would make life better for property owners, was going to pass an assessment statute. This is the type of statute that you may be familiar with where, if a property owner claims there is a violation of property rights, they can ask the government entity involved to do an assessment to determine whether or not they have crossed the line.

The Utah League of Cities and Towns, the Association of Counties, and others said that whole forests would die from all the paperwork they would have to do if they had to file a report every time someone accused them of violating a property right. They said, why don't you just hire one guy. Hire someone to help solve these problems, ride herd over the government agencies, because we know it is never us. We will make sure that those other guys, those other government entities that are involved in these kinds of transactions get a little bit, you know, they get brought up short and we solve these problems without everybody having to go to court.

I was not involved in that at the time. I was, in fact, in New Jersey the day I got the phone call saying, come back to Utah. Your job is ready. And I have just been tickled pink to have this position. It has been a terrific opportunity, not just to get around the country and meet people who are part of a large and successful movement, but also to help the average person solve a problem with government, and as you can expect, it is very satisfying. It is also very satisfying that I don't have to send anybody a bill for my time. The checks come every two weeks and they haven't bounced yet. So it is a pleasure.

The environment in which I operate is not necessarily a very friendly place. There is all kinds of hostility. The way I like to describe this in part is by telling you a short story.

There was a farmer in his field and as he was out plowing he noticed a duck flying overhead. He heard a gunshot and the duck falls to the ground. As he looks over to his fence line, he sees a hunter going over the fence and headed toward the duck. Well the farmer was not amused by this so he puts the John Deere in an after burner mode and heads over there and intercepts the hunter before he gets to the duck and says, get off my private property. The hunter, I've had to change this story, I'm actually in New York this time, the hunter says, you can't do that. I'm an attorney from New York City, and if you don't let me get my duck, you will never hear the end of your legal troubles. The farmer says, we don't use that method down here, sir. We use the three-kick rule. And the hunter says, what is the three-kick rule? The farmer says, I kick you three times, you kick me three times, I kick you three times, you kick me three times, and whoever is standing at the end wins. Well, the attorney looks at the farmer, who has obviously had a few miles on him, and the attorney thinks I am young and virile, I'll do this. So he says okay. The farmer says fine, I'm first. Kicks him in the groin, knocks him to the ground, kicks him in the back and moves one kidney past the other, kicks him in the face and puts his nose over here by his ear. Takes about ten minutes. The attorney gets up and says okay, my turn. The farmer says, go get your duck. That is land use law. That is eminent domain. We often are entitled to something, the government knows we are entitled to it, but by darn, we are going to get our three kicks in before we get a chance to do what we are entitled to do.

Eisenhower said, "I hate war as only a soldier who has lived it can, only as one who has seen its brutality, its futility, its stupidity." Believe me, I have seen it as a land use fellow for Flying J Corporation, a family corporation that the family has been in the business since World War II, and going out and trying to just get simply what you know you are entitled to as a matter of law is an amazing challenge sometimes.

We have tried in Utah to define a system that is fast, that is fair, that is friendly, that is frugal, and that can be final, and we will talk about that a little. By the way, I did pass out to each one of you a printed out version of this presentation so you would know a little bit about what we are talking about.

One of the advantages we have in this phenomenon called Alternative Dispute Resolution is it can also be very flexible. An ombudsman is a government official, appointed to receive and investigate complaints made by individuals against abuses or capricious acts of public officials, one that investigates reported complaints, reports findings, and helps to achieve equitable settlements. It is not my job to try to change the law, although I have had a lot of influence in Utah on the processes that are used. So I am not normally in the context of being out there carrying signs to try to stop a project or trying to remodel the way the law works. In my opinion, the law in many ways is just fine if we could simply get each side to resolve things on the merits instead of based on who has the most power, who has the most money, or happens to be on the powerful side of the counter when you are trying to get a building permit. So my job as the ombudsman is to help property owners understand and protect their constitutional property rights, to encourage state and local government entities—and by the way, they gave me jurisdiction over the local governments, though for some reason I have not got jurisdiction over the federal government entities yet, but stay tuned—and avoid unconstitutional taking of private property without just compensation and then resolve property rights issues fairly in accordance with existing law and without expensive and time consuming litigation. That is my goal and this has helped me achieve some kind of working relationship with the local government officials and that is I am not out for a different result than would happen if it went to court. I can help you predict what is going to happen. Let's make sure that nobody has to go through the big battle and to have the three kicks without having to go through that entire process.

We have an Alternative Dispute Resolution continuum. Basically things get more complicated as they go down the list, but we start out by letting parties talk to each other. That is called negotiation. If I get involved, we try to do things through conciliation; that is, it is pretty informal. We are just trading phone calls. If that doesn't work, we try to mediate. That means we meet in real time with a third party. As an ombudsman I can also issue opinions if necessary, but mainly I am the gatekeeper to all these processes. And I can even use arbitration if necessary.

Negotiation is two people trying to talk to each other. In conciliation, which is most of what I do, I talk to the property owner, then I talk to the government, then I talk to the property owner, then I talk to the government. It is kind of shuttle diplomacy, and, in this age of wonderful cell phones and laptop computers and everything, I can perform this function anywhere I am, and it is a gratifying thing often to find out that people basically are just talking past each other. And sometimes it is really just a matter of me being able to explain to a government official that there will be someone checking to see how this is working.

At one point I had a person call me and he was involved with a project by a government agency headquartered in Washington. What was happening was this agency was building a public works project across his property and where he had had a public facility that divided his property in half before, he could cross that and farm both sides, no problem. Well, they were going to widen it and limit the crossing of it and didn't think they needed to compensate him for this land that was being land-locked. So I called them and it so happened he had a letter, one of the most extraordinary documents I have got in my short life, and it said basically your property, you are evil, you are not working with us, we are going ahead and do our project without getting an easement from you. I thought that was a curious document. It was on the letterhead of the agency, so I called the agency and I said, that seems a little strange to me. They said, and what is your question? I said, well, basically, under the rules of eminent domain if you eliminate the use of a certain part of the property, even more than you need, you have to pay compensation for that. And they said, who are you again? I said I am just the guy with Orrin Hatch's phone number. The idea is that once they are finally understanding that I could probably know what I am talking about, and that there is somebody going to be watching and checking up, all of a sudden things straighten out. And sometimes all it takes is a phone call and when that works, life is good for me.

Mediation is real time. Sometimes we do it in a conference call—Utah is a big state—and sometimes we do it when we get together. But everybody looks everybody in the eye, we talk about what we are trying to get with the dispute and try to resolve it, if possible, on the spot. An ombudsman issues an opinion. A mediator does not. The idea is for the mediator to facilitate the answer, but an ombudsman can do a little investigation and actually publish an answer. I have found that not to be a very helpful tool. Sometimes if I get on the Channel 5 Eyewitness News and I start spouting off, saying that some agency has violated somebody's property rights, they don't return my phone calls nearly as easily. And so I end up, I have found that this is not a particularly helpful way to do it. I tend to deal with the same government officials time and time again, so I really try to do this in a less confrontational way and so far that has worked out pretty good.

An arbitrator does make a decision and it may or may not be binding. In Utah, I have the authority to order any takings dispute or any eminent domain dispute of any kind—that is, the right to take, the amount of the taking, the possession, the relocation, all of those issues—I can order to arbitration if appropriate, and I am the one who determines if it is appropriate. If I find it appropriate, the government entity must participate. It is not binding, but we have tried to use a few tools to make sure that we could use this system without it necessarily breaking down.

For example, we had a situation involving a state agency where they had basically clearly violated someone's property rights. What happened was they had built a wall in the street in front of these people's homes and completely blocked any view beyond the street, which wouldn't have been such a big bad deal except they were high on the east bench of Salt Lake City, and if you can imagine, the views across the Salt Lake Valley to the sunsets to the west and such are really quite spectacular. The only value these people had in their homes after being confronted with the impact of the highway was in the view. And now in order to try to protect the rights of the people higher from the noise, to buffer their noise, these people had had a sound wall sixteen foot tall built right across the street. I called the state agency involved and said, you know, what are we going to do about this. They said, these people haven't had any rights violated. I said that I believe they easily could have. I did some research and found some case law that thought the right to airline view is in fact protected, so I talked to the Department of Transportation in this case and they said, well, if we do arbitrate, which I guess we have to do, we are simply not going to, we will just appeal it. It is just a waste of time. I said, well, I will get back with you.

So I called the property owners together and I said, you guys, if you are willing to put up a little money to hire an arbitrator, I think I have a solution. And they said, what shall we do. I said the former Chief Justice of the Utah Supreme Court just retired. I had lunch with him last week. He said he would be willing to arbitrate some of these cases. So if you are willing to pay his fee, a couple hundred dollars an hour, he will sit and listen to whether you have a takings claim and my guess is, it is just a guess, that a district court judge is probably not going to overturn the decision of an arbitrator when the arbitrator is the former Chief Justice. Long story short, worked like a charm. But before I got this one through, I actually had to face the Solicitor General of the State of Utah in an arbitration hearing in a church meeting room up near the foothills of Salt Lake City where people had a chance to explain their points of view. Ultimately, the Chief Justice ruled they had a property right and all of a sudden the world changed. As soon as it became an issue of how much money was owed, I felt like Joshua at Jericho. The walls came tumbling down and we have no more sound walls along that stretch of the boulevard in Salt Lake City.

Sometimes it works, and the question is, can you get to the merits, can you avoid all the litigation, and just simply give people a chance to have all the information they are entitled to in a form where they can make a decision.

Litigation, of course, is a whole different story. There is a judge, the judge issues a judgement, and, of course, there are parties, but there is a clerk and there is a bailiff and an attorney and there is another attorney and there is another attorney and another attorney and a secretary and there is an expert witness and another expert witness and maybe another secretary and a clerk. The cost just goes crazy and the answer is not based on what is right or wrong. The answer is based on who has the most money and who can take the longest and who can survive the last of the three kicks.

These are the kinds of inquiries I get. Basically during the year that this has to do with ending in July of 2003, I got about 600 calls from property owners and government entities and of those I always, of course, try to inform. I answer questions over the phone. Then, to conciliate means I start calling government entities and working back and forth on maybe a third of those. We actually had to have a face-to-face meeting on maybe a sixth of those and we only arbitrated in that year five or six cases. It just isn't necessary. When the device is in place and they know that there is some accountability, then you don't have to go there. You basically work things out and most of the ones we arbitrated really were clear issues of legitimate disputes over the value of property that was being condemned for a roadway. We will talk about that in a minute and how we do it.

Who calls the ombudsman? I thought basically it would be realtors and forest products guys and mining companies. Those guys don't call me. They have their own attorneys. I am not necessarily the favorite person of the trial bar in the state of Utah, because the idea doesn't sound very good to them. That is, they are thinking, why do we need this guy paid by the state to go out and help property owners when we provide our services. The fact is I am not their enemy. I encourage people to use attorneys whenever possible when they can afford it, because often I just don't have the time to give them the kind of advice that they really need to have on a large case. But as a matter of working things out, it is mainly property owners. It is not the big property owners. It is mom and pop. Professionals, that is, attorneys, often will call me, city and county officials call me for opinions and advice, and state officials call me. By and large, it is small property owners.

What kind of property is involved? It is basically people's homes. A large percentage are homes. Some of it is vacant land, particularly exactions on land, what can the government require of me if I want to get a building permit, but farms and businesses are quite a bit less. So mainly it is homes, because the highways run by homes and the regulations relate to homes.

What types of questions? Eminent domain is about a third of all the calls I get. Takings that have nothing to do with land use. For example, inevitably recurring flooding, those kinds of things. Land use type takings is the biggest one. That is, does the land use decision in my case, either one I am trying to get enacted or one that is being enacted in my neighborhood against me, does it create a taking under the U.S. Constitutional jurisprudence? Then you have land use cases that are not takings. They might just be statutory issues. Did they follow the right procedure, can they do this under their own ordinances, those kind of things, and then issues between property owners who are in a dispute with their neighbor. Basically I am no help with this but I mention it because I get a lot of those kinds of calls.

Which government entities are involved? Not much federal, quite a bit of state. Usually this is the Department of Transportation acquiring land for road projects. Utilities, private utilities, counties, but by and large it is city government, and by and large it is land use. Often it is eminent domain issues. I can certainly help in these economic development projects to make sure people are treated legally, if not fairly.

To summarize, how is this going? Basically, it is pretty fast. I try to use conciliation if possible. I simply don't have time. I appreciate my job, but they didn't even give me a secretary. So I basically have a headset that I wear with me wherever I am and when the phone rings, I answer it and try to give people some help. I try to keep messages of what I have got so as my mind drifts slowly into middle age, I am finding it more and more important to keep a log of my calls. But we reconciliate. If we need to mediate, we set a mediation session. Within ten days' notice, I can order a pre-arbitration conference. I just have to send them a registered letter saying the conference is this day at this time. If the government entity does not participate, then there is going to be a record established and they are not going to like it. I have never had it happen that they refused to show up. Once I've explained that, they always come. And again, it is not perceived to be such a hostile situation. My job is to try to make it look like when people come to these dispute resolution processes, it is going to be a fair process for the government entity and for the property owner. It is fair. They can call me as an attorney. I will try to give them the straight answer. The good news is I may not know much about much but I know quite a bit about takings and so I can give them a pretty good answer to that question and I am sure I spend more time on it than the other attorney, and that makes up the difference in some cases if they are a whole lot smarter than I am.

The government shares all of its information about the dispute, including appraisals, and I have actually had to put together a booklet on Government Records Act to try to give to property owners. I give them the forms and the thing about my form that is different is on the back of my form is the law and the government can read it. So a local government entity knows they have to produce the document. I had a knock down-drag out fight, almost appealing it to the state records committee to determine whether or not the Department of Transportation was going to share its appraisals, but the fact is that they are not privileged information. Under Utah law as soon as someone knows how much the appraisal is the whole document is public, and they have no right to withhold that information. So a property owner could actually see the appraisal on his neighbor's property and see how his offer compared to his own and, although Utah's attorneys didn't necessarily think that was the best idea they had ever heard, I have generally found that, when the information is shared and everybody has got it and they know they are being treated fairly, all kinds of people will resolve their disputes simply by being given the dignity as a citizen of being treated as an equal in a dispute resolution.

If appropriate, and I know you are not going to believe this one, if appropriate the government entity pays for a second appraisal using the property owner's choice of appraiser. That power was given to me six years ago after I had been in my position a year. I went back to the legislature and said, thanks for the job. It is just great; however, I need a hook. That was when they gave me the power to order arbitration. At that time a group of senior citizens tried to influence the legislature to solve problems of eminent domain, and I'll be darned if those folks being very active at the grassroots, like Carol was talking about, didn't convince the Utah legislature to give me the authority to order free appraisals for property owners in eminent domain actions. And then the government entity said, well, we have a list of appraisers. Why don't you have them use one of these. My answer, no, you've got to pick your appraiser. They get to pick the second appraiser. I will simply not decide who the appraiser is going to be. As long as that appraiser is licensed, the property owner can use them. And the government entity says, well, maybe that appraiser is just loopy. I said, happy day for you if you get a loopy appraiser from the property owner, because it will be easier for you to show that your appraiser is better. But I am simply not going to dictate to the property owner. That would be great, wouldn't it, another government guy telling them who they are going to use to value their property?

Finally the property rights ombudsman works to maintain a respectful and agreeable relationship of agencies and property owners, so to try to mediate and negotiate, be nice, spread peace and love, comment, determine settlements that are reached based on the party's real interest, power is equalized.

The budget for the ombudsman office is only $150,000 a year. There is no charge. To that extent I differ from some attorneys. There is no charge. That is everything, by the way. That is not salary. There is no charge to property owners or agencies for anything I do. I do have some forms because people insist on using forms. It wasn't my idea but sometimes people just really feel like they got to fill out blanks. I take notes. I call people. I give answers. If necessary, I send a letter to the government entity saying, this is the answer that we came up with, and in seven years I just never had it deteriorate to the point that we had to negotiate extraordinarily complicated settlement arrangements. If you talk to mediators and arbitrators, often they will give you piles of paper that need to be filled out before you can even use their services. I am not for that. I just don't have time. It is not my interest to prejudice anybody's position. If they want to hire attorneys and go through that, that's fine. But basically government entities, once you break through the impasse and get to an answer, then they are going to want the thing behind them and get on with life. Occasionally you find that is not the case, but really run-of-the-mill folks and government entities once they decide how it is going to be, they just want to get on. They don't want to get involved in any three kicks coming back at them.

Finally, when parties resolve a dispute on terms that are mutually agreed to, unresolved resentments do not come up again later. I think I have time for a short story here. In 1998 the Utah Legislature passed a law that would have required any government entity condemning land in Utah to completely replace in kind every single piece of property they acquired whether it was a farm, a business, or a home. If you are familiar with the federal rules, you know that if a government entity buys a home and uses federal money, they have to replace that home and put people into it. Utah legislature voted to make that the case with every piece of property, farm, business or home. The legislature did that on the last day. There wasn't a whole lot of discussion. Again, it was our seniors' lobby out there just really getting things nailed right. The governor had a nuclear hissy fit. They couldn't stand the thought. Think about it. Union Pacific Railroad, they are going to have to build them a new railroad. It just couldn't work. The governor had to veto that bill. After he did, then he suggested we do something. Of course, he made some conciliatory statements trying to get everybody to come back together and not hate him for vetoing the bill. So we had this meeting. The senator that carried the bill met with me and officials from the Utah Department of Transportation and these folks from the seniors' lobby. We started talking about why it was necessary and one of the seniors started telling about an experience he had when his mother's land was condemned to rebuild Interstate 15. The Utah guy that was there at the time, no longer with the agency, jumped right in and started defending the agency, saying we don't do that anymore. That is not how we do it. I put my hand on his shoulder and said, Bob, just kind of relax. Listen to what the guy has to say. The guy went on and on and on and obviously he was just drudging up all kinds of thoughts. That is a very good therapy, which is often what I do, and when he got to the bottom and he said, that's why we passed the bill. I asked one question. When did that happen? When did your family go through that? He said, 1961. So it has been 36 years later and people still remember it to the extent they could almost turn the Utah eminent domain law on its head. That is why we need to resolve these things in another way. This is my speech to the government guy. It is flexible. There is no formula. Sometimes it is just conversation. Sometimes arbitration. It is citizen centered, hand crafted, and allows for all the flexibility necessary where things are emotional, timing is critical, and basic rights are at stake.

There is a lot ahead of us. I am comparing the old state procedure which is the federal procedure to the new Utah procedure, and I am on a crusade. I believe the federal government should make three significant differences in how it condemns land. First of all, they should share their appraisals. Second of all, they should in the statute, embrace this idea of mediation and arbitration of disputes so that people don't necessarily have to go through a full blown court action over a $3,000 piece of property. And third, there ought to be a gatekeeper for that process, perhaps even a property rights ombudsman.

Hey, we are down nearly to the end. Basically, in my materials I have put my name and address there so you know where to refer people to me if you have any questions. Simply as a closing gesture, I wanted to point out that at the back of my packet is this handy-dandy reduced version of my web site photo page. This is not the most sophisticated web site you are ever going to encounter in your life; however, there are documents attached to it. So if you have impressions about this, if you want to see the statute, if you want to see all the documents that I've prepared which advise property owners about their rights and how the processes work, it is all right here in one single place, and I hope it might be of interest to you if you surf around the web looking for these kinds of information. If you can't remember the address, it is, which is printed at the bottom and also on the material you have, or you can use Google or some other search and simply write in property rights ombudsman and you are bound to find me. I am the only one of those there is in the world. So I hope that works out quite well. Thank you very much for your time. It has been a real pleasure to be here.

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