– GFTLenexa, LLC v. City of Lenexa

Background:

Oak Park Commons owned commercial property and leased it (ground lease) to Centres Midwest; Centres subleased to Bridgestone. GFTLenexa acquired Centres' leasehold interest by assignment in 2010.
In 2013 the City of Lenexa initiated eminent domain proceedings against Oak Park for partial taking, but did not name GFTLenexa as a defendant; Oak Park received notice and the City paid the agreed appraisal award to Oak Park.
GFTLenexa did not intervene in the condemnation; later Bridgestone sued GFTLenexa for rent reductions caused by the taking, and the court ordered GFTLenexa to reduce rent and refund past amounts.
GFTLenexa then sued the City in inverse condemnation seeking compensation for lost rental revenue, arguing its contractual rights created a cause of action against the condemning authority.
The district court granted summary judgment for the City; GFTLenexa appealed directly to the Kansas Supreme Court. The Court concluded appeals in inverse condemnation go to the Court of Appeals but retained jurisdiction for this case and affirmed the district court.

Issues:

Issue	Plaintiff's Argument	Defendant's Argument	Held
Proper appellate forum for inverse condemnation final judgments	Appeal to Supreme Court was proper as an eminent-domain-related appeal	Court of Appeals has jurisdiction over inverse condemnation appeals; Supreme Court has concurrent jurisdiction and may retain cases	Court: Court of Appeals ordinarily has jurisdiction; Supreme Court may retain in a given case; appeal improperly docketed but not dismissed; retained and decided on merits
Whether GFTLenexa can recover from the City for lost lease revenue after owner was paid	GFTLenexa lost property-related contractual value and may seek inverse condemnation damages from the City; its lease allowed suit against condemning authority	City argued owner was fully compensated and GFT failed to intervene or protect its interest; condemnor met obligation by paying total award	Court: GFTLenexa barred—landowner was paid; GFT had notice and could have intervened; it cannot relitigate to obtain more compensation from the City
Whether contract clause created enforceable claim against the City (third‑party beneficiary/privity)	Lease/sublease language authorized tenant to pursue separate recovery from condemning authority, so City is contractually liable	Contract binds only parties; City was not in privity and received no consideration; no third‑party beneficiary exists to bind City	Court: No privity or third‑party beneficiary; GFT cannot enforce its contract against the City
Whether allowing GFT recovery would permit double recovery / violate undivided‑fee rule	Recovery is needed to make GFT whole for its leasehold loss	Allowing recovery would make the condemnor pay twice for the same taking; under undivided‑fee rule condemnor must pay total value once; allocation among claimants is a separate matter	Court: Recovery against City would improperly double compensate; undivided‑fee rule bars GFT's claim after owner was paid

Key Cases Cited

City of Manhattan v. Kent, 228 Kan. 513 (1980) (explains undivided‑fee rule and condemnor's duty to pay total award)
City of Roeland Park v. Jasan Trust, 281 Kan. 668 (2006) (parties may contract regarding distribution of condemnation awards among themselves)
State ex rel. Stovall v. Reliance Ins. Co., 278 Kan. 777 (2005) (contracts bind only parties absent third‑party beneficiary)
State Highway Comm'n v. Bullard, 208 Kan. 558 (1972) (distinguishes standing to intervene where tract abandoned; inverse condemnation as proper recourse when not a party)
Hiji v. City of Garnett, 248 Kan. 1 (1991) (elements required to prove inverse condemnation)
Creegan v. State, 305 Kan. 1156 (2017) (government must provide notice and compensation before seizing property)
Frick v. City of Salina, 290 Kan. 869 (2010) (procedural history illustrating Supreme Court transfer practices in condemnation appeals)
Northern Natural Gas Co. v. ONEOK Field Servs. Co., 310 Kan. 644 (2019) (summary judgment standards for appellate review)