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Justices decline Md. rubble company’s bid to revive $45M verdict

The Supreme Court is seen in Washington, early Monday, June 15, 2020. (AP Photo/J. Scott Applewhite)

The Supreme Court is seen in Washington, early Monday, June 15, 2020. (AP Photo/J. Scott Applewhite)

The U.S. Supreme Court on Tuesday declined Maryland Reclamation Associates Inc.’s request that the justices review and reinstate a $45 million jury award in a litigation battle MRA has waged against Harford County for nearly 30 years over the company’s right to use its property as a rubble landfill.

The high court let stand without comment the Maryland Court of Appeals’ unanimous ruling in April that the jury’s verdict must be tossed because the company had failed to present its constitutional challenge to Harford’s ban of MRA’s planned use during the county’s administrative proceedings before bringing the claim to court.

In its 7-0 decision, Maryland’s top court cited the legal rule that companies cannot challenge county zoning decisions in court without having exhausted their administrative appeals. The Court of Appeals noted that Churchville-based MRA had not pressed its constitutional claim before Harford’s Board of Appeals.

In its failed petition for Supreme Court review, MRA said the jurors validly considered and accepted the company’s claim that the county’s ban on the planned land use was a governmental “taking” of private property for which MRA was owed “just compensation” of $45 million under the Constitution.

MRA argued that the exhaustion requirement does not apply to challenges under the Constitution’s Takings Clause because the issue is too important to be constrained by administrative procedure.

That procedure calls for courtroom appeals of board decisions to go before judges who must defer to the boards’ rulings so long as they are “fairly debatable,” based on substantial evidence and not arbitrarily or capriciously reached.

Thus, requiring Takings Clause challenges to go before county administrative boards – as the Court of Appeals ruled — denies litigants “meaningful access to a court” because judges, and by extension juries, cannot independently decide an issue of constitutional import, wrote John R. Greiber Jr., MRA’s counsel of record at the Supreme Court.

“It strains objectivity beyond recognition to envision any legal decision (by a board) that is not ‘fairly debatable’ in an advocacy system,” Greiber wrote, in stating that the exhaustion rule unfairly favors county administration boards in takings cases.

The Court of Appeals’ decision should be overturned because it erroneously took “an over exacting litigation rule of judicial origin and application” and “superimposed (it) on the Takings Clause,” added Greiber, of Smouse and Mason LLC in Annapolis.

Harford County waived its right to respond to MRA’s request for Supreme Court review unless the justices specifically asked for the county’s response. The county was represented by Andrew H. Baida, of Rosenberg Martin Greenberg LLP in Baltimore.

The case was docketed at the high court as Maryland Reclamation Associates Inc. v. Harford County, Md., No. 20-335.

Harford County Executive Barry Glassman hailed the Supreme Court’s denial of MRA’s request for review.

“This has been a 30-year odyssey,” Glassman said.

“We have been confident all along that this was a matter of local zoning,” he added. “The county always felt it was on solid ground. After a 30-year battle, we have been vindicated on what our position was.”

MRA President Richard D. Schafer said in a statement that the company is “deeply disappointed that the Supreme Court’s summary decision sees justice in vacating a jury’s decision to award just compensation for the regulatory taking of its property, after an evidentiary trial on the merits.”

“This failure to grant certiorari (review) lets stand a Maryland Court of Appeals decision that sees justice in an administrative procedure that would have merely duplicated what an impartial jury of Harford County residents already decided in a two-week trial,” Schafer added. “Such after the fact judicial reasoning is constitutionally inequitable, capricious in result and flies in the face of common sense and reason. MRA is currently weighing all options.”

MRA bought the 62-acre property in 1989. The county had previously included the property in a waste management plan and the state issued an environmental permit, allowing the land to be used as a landfill, according to court documents. But the county then adopted a zoning amendment with new conditions that hindered MRA’s ability to use the property as a landfill, the documents stated.

MRA initially sued in 1991, seeking to move forward with the rubble landfill project on the grounds that the company had a vested right to do so. The case went up and down the court system, with multiple stops at the Court of Appeals, which held in 2004 that MRA could still seek a zoning variance or exception before asking for judicial review.

On remand, the Harford County Board of Appeals denied the zoning variance a final time in 2007. MRA was unsuccessful in getting that decision overturned in court, including in the Court of Appeals in 2010.

In 2013, MRA filed the controversial lawsuit, claiming that the county deprived the company of “beneficial use” of its property for which just compensation is owed under the Constitution.

The Harford County Circuit Court jury agreed with MRA that the county’s rejection was a “taking” and set the just compensation at $45.4 million, including $30.8 million in principal and $14.6 million in interest. The Court of Special Appeals overturned the verdict last year, saying MRA had failed to file suit within three years of the Board of Appeals’ June 5, 2007 rejection of the company’s request for variances to build the landfill.

The Court of Appeals said it agreed — in a footnote to its 83-page opinion — that the lawsuit was filed too late but expressly chose not to decide the case based on the statute of limitations. Instead, the high court held that MRA’s takings claim could not have been brought in court because the administrative process had not been exhausted.

The Court of Appeals rendered its decision in Maryland Reclamation Associates Inc. v. Harford County, Md., No. 52 September 2019.

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