Rex Realty Co. v. City of Cedar Rapids, State of Iowa, Intervenor ( 2003 )

MAGILL, Circuit Judge.

Rex Realty Co. (“Rex”) appeals the district court’s¹ order finding that the notice provisions of Iowa Procedure Under Eminent Domain, Iowa Code Chapter 6B (1999), satisfy constitutional due process requirements. Rex alleges that the statute is unconstitutional because it did not require the City of Cedar Rapids (“City”) to provide pre-deprivation notice and an opportunity to be heard on whether a taking was for a “public purpose.”² The district court found that the Due Process Clause of the U.S. Constitution, U.S. Const, amend. XIV, § 1, and the Due Process Clause of the Iowa Constitution, Iowa Const, art. I, § 18, do not require a city taking property under its power of eminent domain to provide the landowner with a hearing prior to the initiation of condemnation proceedings on the issue of whether the taking is for a public purpose. The district court entered judgment for the City, and Rex appeals.

Our jurisdiction is proper pursuant to 28 U.S.C. § 1291. For the following reasons, we affirm.

I.

Rex owned real estate in Cedar Rapids, Iowa. The City wanted to extend Fourth Street Court SW, which would require the acquisition of a portion of Rex’s parcel and portions of parcels belonging to other private property owners. The City’s attempts to acquire the land date back at least to a December 9, 1997, meeting between the City and the affected property owners. After more than a year of negotiations ended in Rex’s rejection of the City’s $38,000 offer, the City Engineering Department advised Rex in a May 20, 1999, letter that it would recommend that the City Council initiate condemnation proceedings.

On June 2, 1999, the City passed a resolution (“Resolution”) seeking to condemn a portion of Rex’s property. The City filed an application for condemnation in Iowa District Court, noting that the land would be used for an additional street right-of-way. The state judge signed the application on June 10, 1999, thereby certifying that it was legally sufficient. See State v. Johann, 207 N.W.2d 21, 24 (Iowa 1973). Rex was served with a Notice of Condemnation (“Notice”) on June 17, 1999. The Notice provided, inter alia, that the City desired condemnation for the purpose of an additional street right-of-way, that a compensation commission (“Commission”) had been appointed to appraise the damages, and that the Commission would meet on July 21, 1999, to view the premises and appraise the damages.³ In addition, the Notice provided the time and place of the Commission’s meeting.

Prior to the Commission’s meeting, Rex did not request a formal hearing to raise the issue of public purpose and did not commence any legal action in state or federal court to challenge the condemnation. The Commission held its hearing as scheduled, and Rex’s counsel appeared on Rex’s behalf. The Commission determined Rex’s damages to be $38,000. Within a matter of days, the City paid Rex this amount, thereby vesting title to the property in the City.

Rex initially filed an appeal in state court as provided by Iowa Code §§ 6B.18 and 6B.21-.24 (1999), but voluntarily dismissed the appeal without prejudice. Rex subsequently brought suit in federal court, claiming that the City’s failure to provide notice and a hearing on the issue of public purpose violated Rex’s procedural due process rights. The district court held that due process did not require the City to provide Rex with notice and opportunity to be heard on the issue of'public purpose before condemning Rex’s property.

II.

“Eminent domain is the power of a governmental entity to take private property for a public use without the owner’s consent.” ACCO Unlimited Corp. v. City of Johnston, 611 N.W.2d 506, 510 (Iowa 2000) (citation omitted). Iowa law grants cities the power of eminent domain, so long as the taking is for a public purpose and is reasonable and necessary. Iowa Code § 6A.4(6) (1999). With regard to the requirements for the proper exercise of this power, in this circuit “it is well settled that a sovereign vested with the power of eminent domain may exercise that power consistent with the [Constitution without providing prior notice, hearing, or compensation, so long as there exists an adequate mechanism for obtaining compensation.” Collier v. Springdale, 733 F.2d 1311, 1314 (8th Cir.1984) (citations omitted). An adequate mechanism existed for Rex to obtain compensation: the Commission’s July 21, 1999, meeting. Rex received notice of this meeting thirty-four days prior to the meeting, well beyond the statutorily required ten days, Iowa Code § 6B.8 (1999).⁴ Moreover, the City Engineering Department notified Rex in the May 20, 1999, letter that it was planning to advise the City Council to proceed with condemnation, and Rex could have appeared at the June 2, 1999, City Council meeting to challenge the City’s contention that the right-of-way was a valid public purpose.

In addition, under Iowa common law, Rex had the right to collaterally attack the condemnation and seek injunctive relief at any time before the Commission’s meeting. See Banks v. City of Ames, 369 N.W.2d 451, 454 (Iowa 1985) (stating that the issues of necessity and public purpose “may be raised by an independent action seeking to enjoin condemnation” (citation omitted)); Mann v. City of Marshalltown, 265 N.W.2d 307, 313-14 (Iowa 1978) (permitting an action for an injunction where plaintiffs alleged that the taking of their land was not for public use). Rex was served notice of the condemnation thirty-four days before the Commission’s meeting. Accordingly, under Banks and Mann, Rex had thirty-four days to challenge that the condemnation was not for a public purpose.

Finally, in addition to the option of pursuing an action for injunctive relief, Rex could have petitioned in state court for a writ of mandamus or a writ of certiorari. See Owens v. Brownlie, 610 N.W.2d 860, 865-66 (Iowa 2000) (“These remedies give the condemnee a procedural vehicle to promptly challenge the propriety of the condemnation, including the issue whether the property sought to be condemned is necessary for public use. Although our legislature primarily decides those activities that constitute public use, courts decide whether the underlying facts show an activity that constitutes a public use.”).

Rex failed to exercise these procedural rights by pursuing any appropriate action in state court prior to or after the Commission’s meeting. In federal court, Rex then claimed procedural due process violations. However, Iowa law denied Rex no rights afforded by the federal constitution.

III.

For the foregoing reasons, we affirm the district court.

1 . The Honorable Michael J. Melloy, then United States District Judge for the Northern District of Iowa, now United States Circuit Judge for the Eighth Circuit Court of Appeals.

2 . Since the events giving rise to this action, the Iowa Code has been amended, and now requires notice and a hearing on the necessity of condemning "agricultural land” for public improvement before the adoption of a resolution to condemn. Iowa Code § 6B.2A(1) (2001).

3 . Prior to the amendment, see supra note 2, Iowa Code §§ 6B.4 and 6B.14 (1999) limited the Commission’s review to the assessment of damages. After the amendment, the Commission may review whether condemnation of “agricultural land” is necessary for the placement of an industry. See Iowa Code § '6B4.A (2001).

4 . This provision has also been amended, and the required statutory notice is now thirty days prior to a Commission’s meeting. Iowa Code § 6B.8 (2001).