107 Fed. Cl. 9
Fed. Cl.2012Background
- Six projects involve government-insured low-income housing with affordability restrictions; five are §221(d)(3) projects and one is §236 (100 Centre Plaza).
- Prepayment of insured debt without HUD approval was prohibited for 20 years under the Preservation Statutes, and HUD approval was required for prepayment, tying prepayment to continued affordability.
- Plaintiffs allege LIHPRHA effected regulatory taking by eliminating their contractual right to prepay; defendant moves for summary judgment arguing there was no contract-based prepayment right.
- Deeds of trust notes and regulatory agreements for five properties show no right to prepay during the mortgage term; 100 Centre Plaza’s modification and amendment created a disputed right to prepay.
- HUD processed LIHPRHA incentives and regulatory interpretations suggested that prepayment rights could be superseded by regulations, influencing the court’s analysis of whether a property had a vested prepayment right at the time of the taking.
- The court grants summary judgment for five properties, and denies it for 100 Centre Plaza, thereby concluding no taking as to the five properties but preserving a prepayment right claim for 100 Centre Plaza.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether LIHPRHA deprived six properties of a contractual right to prepay | Milwood et al. show HUD policy grants right | No contract-based prepay right; regulation governs | Five properties: no taking; no contract right present |
| Whether 100 Centre Plaza had a contractual prepay right at the taking | Amendment reinstated right to prepay the 236 portion | Amendment structured to obtain incentives, not prepay | 100 Centre Plaza: denial of summary judgment; prepay right found |
Key Cases Cited
- Anaheim Gardens v. United States, 444 F.3d 1309 (Fed.Cir.2006) (preservation acts set high HUD approval conditions for prepayment)
- Huntleigh USA Corp. v. United States, 525 F.3d 1370 (Fed.Cir.2008) (valid property interest required at time of taking)
- Cienega Gardens v. United States, 331 F.3d 1319 (Fed.Cir.2003) (property interest required for takings; focus on timing)
- Branch v. United States, 69 F.3d 1571 (Fed.Cir.1995) (no one has a property interest in a rule of law)
- New York Cent. R. Co. v. White, 243 U.S. 188 (1902) (no vested interest in any rule of law)