A news item that appeared in the Arizona Republic on November 27 gives a bit of insight into the worlds of homeowner associations and tax foreclosures, and reports a bizarre outcome when those two worlds collided:
A Michigan real estate developer was the highest bidder for a square-inch piece of land in Owen County [Indiana], shelling out $1,752.60 for the parcel in a wooded ravine.
Andy Gutman… had the highest of nine bids and won the postage-stamp-size property on eBay.
Bidding on the .0000000159 of an acre started at $1,500, the amount owed in back taxes, interest and fees after the land went unsold during a recent tax sale.
….
At the per-square-inch selling price, an acre of the land would have cost more than $7 billion.
After the land’s back taxes are paid, First National Bank in Cloverdale will receive $492.92.
The real estate deal that resulted in the tiny parcel dates to the 1960s, when a homeowners association decreed that only landowners could use Cataract Lake. One resident decided to get around that rule by writing up a deed to his relatives, giving them ownership of a single square inch of his land.
When the owner of the full parcel failed to pay the mortgage on the property, First National Bank foreclosed in 2002, according to county officials. Because of the unusual deed, the bank broke out the 1-inch parcel as a separate plot from the 1.12-acre property, said Angie Lawson, Owen County auditor.Even though the larger property sold, the taxes kept piling up on the tiny parcel.
This situation is actually a variation on one that occurs fairly commonly: a small bit of land becomes separated from a larger parcel, is forgotten, and ends up the subject of a tax lien foreclosure. What’s weird about this situation is why the small bit was separated from the larger parcel, as a way to get around a restriction imposed by a homeowners’ association.
A second news item, which got considerable attention in the print news media and the blogoshpere, details what I think can only be described as a case of mixing apples and oranges in a decision about whether a landowner should be liable for damages caused by someone else’s intentional wrongdoing on the landowner’s property. This description is from Overlawyered.com:
Twelve years after the event, a jury finds someone to blame for the [1993] bomb attack [at the World Trade Center in New York City] that killed six, injured nearly 1,000, and caused costly business dislocation. The culprit? The Port Authority, an agency whose losses are likely to be ultimately borne by New York and New Jersey taxpayers, motorists and air travelers:
The jury voted unanimously that the Port Authority [then-owner of the WTC] was negligent. It found the authority 68 percent at fault for the bombing, while the terrorists who carried it out were 32 percent at fault.
[T]he plaintiffs’ lawyer said that because the jury apportioned more than half the blame to the Port Authority, the agency will have to pay 100 percent of any damages for pain and suffering, the so-called non-economic damages, that might be awarded.
Regardless of how the blame was shared, the Port Authority would have to pay 100 percent of any economic damages, like lost business, he said.
…And this from [the Plaintiffs’ lawyer]: “The case was never about blaming the terrorists.” Well, of it wasn’t, from his point of view, was it? (Anemona Hartocollis, “Port Authority Found Negligent in 1993 Bombing”, New York Times, Oct. 27).
So there you have it. “What is robbing a bank compared with founding a bank?” wrote Bertolt Brecht, and now we learn that being the target of a terrorist act carries with it more than twice as much responsibility for the resulting damage as actually planting and detonating the bomb. The jury’s (and plaintiff’s lawyer’s) rationale was that security experts had warned that the use of car bombs was on the rise, and yet the Port Authority did not take the (massively disruptive to its tenants) step of closing its enormous underground garage to the public.
So a jury was asked to compare the responsibility of criminals who deliberately bombed a building with the building owner’s responsibility for failing to prevent the bombing, and came up with the bizarre result that the building owner had the greater responsibility. Who was it who said, “truth is stranger than fiction?”
