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U.S. v. Certain Land Situated in the City of Detroit

United States District Court, E.D. Michigan, Southern Division
Feb 27, 2002
Nos. 79-CV-73934-DT (E.D. Mich. Feb. 27, 2002)

Opinion

Nos. 79-CV-73934-DT

February 27, 2002

David H.Fink, Mark J. Zausmer, Thomas A. Biscup, FINK, ZAUSMER KAUFMAN, P.C., Farmington Hills, MI.

THOMAS L. SANSONETTI, Assistant Attorney General Environment Natural Resources Division.

RAYMOND HAMILTON, Assistant United States Attorney, Albuquerque, NM.

MATTHEW S. CLIFFORD, U.S. Department of Justice Environment Natural Resources Div. Washington, D.C.


OPINION AND ORDER DENYING DEFENDANT DETROIT INTERNATIONAL BRIDGE COMPANY'S MOTION TO INTERVENE


I. INTRODUCTION

Detroit International Bridge Company ("DIBCO") is the principal defendant in United States v. Certain Land, No. 79-CV-73934-DT, a condemnation action for the taking by the Government of two parcels of property totaling approximately 3.75 acres of land owned by DIBCO. On December 28, 2001, DIBCO filed a Motion to Intervene in United States v. 0.41 Acres of Land, et al., No. 96-CV-75494-DT; United States v. 0.074 Acres of Land, et al., No. 96-CV-75495-DT; and United States v. 0.41 Acres of Land, et al., No. 01-CV-70391-DT. These three condemnation actions concern two parcels of property owned by Walter Lubienski and Commodities Export Company (referred to herein as the "Commodities Defendants".)

The Government and the Commodities Defendants responded to DIBCO's Motion on January 14 and January 16, 2002, to which responses DIBCO replied on February 4, 2002. Having reviewed and considered the parties' briefs and the entire record of these cases, the Court has determined that oral argument is not necessary. Therefore, pursuant to Local Rule 7.1(e)(2), this matter will be decided "on the briefs." This Opinion and Order sets forth the Court's ruling.

II. FACTUAL BACKGROUND

In 1979, the United States Government initiated condemnation proceedings against the Detroit International Bridge Company and others for the taking of three parcels of property totaling less than 4 acres of land for the expansion of the U.S. Customs cargo inspection facility on the American side of the Ambassador Bridge. The two largest of those parcels were owned by DIBCO. The Government's taking of these two parcels was hotly contested by DIBCO from the inception of the action. However, in 1991, the United States (through the General Services Administration) entered into a Memorandum of Agreement (the "MOA") with DIBCO to settle the 1979 condemnation proceedings.

The third parcel a strip of undeveloped land of less than 1/10 acre that was situated between the two DIBCO parcels was owned by an individual named Nash Sogoian. A Stipulation and Judgment was entered on September 17, 1987 with regard to Sogoian's parcel pursuant to which Sogoian was paid $35,000.00 for his property.

Although the stated purpose of the MOA was the settlement of the 1979 eminent domain action, the Agreement actually went beyond the scope of the expansion of Customs facilities contemplated by the original Declaration of Taking and beyond the physical boundaries of DIBCO's property. Pursuant to the MOA, the Government agreed to a much larger expansion of the federal project and, accordingly, called for the future condemnation of other neighboring properties.

The MOA called for the Government to pay DIBCO $1.24 million as compensation for the two parcels of land owned by DIBCO which were being condemned in the 1979 action. DIBCO, in turn, agreed to pay the Government for certain "Incremental Costs" arising out of revisions to the proposed federal project, including costs of acquisition of other properties within the "Expanded GSA Site." Among these other properties designated for condemnation under the MOA were two adjacent parcels of land owned by Walter Lubienski and Commodities Export Company. Commodities operates a duty-free store on one of these parcels. Mr. Lubienski is the owner of Commodities as well as of the adjacent parcel of vacant land.

With respect to DIBCO's responsibility for "incremental costs", the MOA provided as follows:

(6.1.3) DIBC agrees to compensate GSA and make GSA "whole" for all Incremental Costs incident to and arising out of revisions to the proposed Federal Project as follows:
(6.1.3.1) Costs related to the completion of a Supplemental Environmental Impact Statement necessary to implement the Approved Plan on the Expanded GSA Site.
(6.1.3.2) Costs for the acquisition of the Expanded GSA Site, which costs shall be defined as all costs incurred by the Federal Government in obtaining unencumbered fee-simple title in the Expanded GSA Site, excluding the area of the GSA Site. Said title shall be subject to the approval of the Attorney General. Such costs shall include, but not be limited to, site acquisition costs (whether by voluntary conveyance or by eminent domain, including all settlement and interest costs paid by the Federal Government), site appraisal costs, title evidence costs, site survey costs, and the cost of relocation services as provided for under the Uniform Relocation Assistance and Real Property Acquisitions Policies Act of 1970, as amended (P.L. 91-646), for affected individuals, businesses and utilities.
(6.1.3.3) All contractual design and construction costs resulting from requests by DIBC for modifications to the Federal Project.

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(6.1.5) DIBC's compensation obligation shall continue until the Federal Government has: acquired fee simple title to the Expanded GSA Site whether said title is acquired through voluntary conveyances, or through stipulations for settlement or final judgements [sic], including appeals therefrom, of all eminent domain proceedings for such acquisitions, including all relocation assistance; and completed construction of all construction contracts . . . .
(6.1.6) . . . In the event that the actual amount of Incremental Costs exceeds the amount secured by DIBC's irrevocable letter of credit, GSA shall provide DIBC with written notice of that amount. If it is subsequently determined by mutual agreement of the parties hereto or by an order of a court of competent jurisdiction that DIBC is obligated to pay that amount to GSA and DIBC fails to pay that amount within thirty (30) days after such determination or after the expiration of all periods of appeal from any such court order, DIBC shall be deemed to have forfeited all rights, privileges, and property interests conferred upon DIBC or to which DIBC is entitled under the terms of this Agreement.

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(8.2) . . . [T]he obligation of DIBC for compensation to GSA of Incremental Costs for services shall not exceed the price which is determined to be fair and reasonable pursuant to the applicable Federal procurement regulations . . .

With respect to the effect and binding nature of the terms of the MOA, the Agreement further provides:
(8.3) It is intended by the parties that this lawsuit, Civil NO. 79-73934, be settled by the payment of just compensation in the amount agreed to in this Agreement and in the Stipulation of Settlement which will be drafted based upon this Agreement; and it is agreed that the issue of just compensation may not be reopened based on any alleged breach of the Stipulation of Settlement. It is further agreed that DIBC waives any further claims it may have for attorney fees, costs or damages arising from this lawsuit and any alleged breach of this Agreement or the Stipulation of Settlement. However, the parties agree that they shall have the right to apply to the United States District Court for the Eastern District of Michigan for enforcement of this Agreement of of the Stipulation of Settlement. But it is understood and agreed that such application for relief shall constitute an entirely independent and separate cause of action from this lawsuit. It is intended by the parties that Civil Action 79-73934 be entirely concluded by the entry of final judgment and may not be reopened based on any alleged breach of this Agreement or Stipulation of Settlement, and shall not in any way change or modify the amount agreed upon as just compensation.
(8.4) It is understood by the parties that all agreements between GS and DIBC as consideration for settlement of this litigation are subject to the review of the Attorney General and although settlement by utilizing said Agreement will be recommended, entry of a stipulation cannot be guaranteed. It is further understood that DIBC shall not be bound by this Agreement until and unless GSA is so bound . . . .

Upon learning of the terms of the MOA in December 1991 after obtaining a copy of the Agreement through the Freedom of Information Act, Commodities and Lubienski moved to intervene in the 1979 action. Although this Court denied the motion, the Sixth Circuit Court of Appeals reversed that decision and directed this Court to permit Commodities and Lubienski to intervene.

The Court of Appeals specifically found Commodities' and Lubienski's intervention in the action proper because the MOA provided for condemnation of their property and this Court's approval of the Agreement would, as a practical matter, impede Commodities' and Lubienski's ability to protect their interest in their own land without their having any input in the matter unless they were permitted to participate as intervening defendants. See United States v. Detroit Int'l Bridge Co., 7 F.3d 497, 500-503, 505 (6th Cir. 1993). Thereafter, DIBCO, Commodities and Lubienski proceeded for the ensuing five years to litigate in this Court the issue of validity of the MOA and the merits of Commodities' claim for injunctive relief to enjoin implementation of that Agreement. These issues were finally decided by the Court's March 1999 ruling on the parties' cross-motions for summary judgment.

Meanwhile, although the Government conceded all along since 1992 that the MOA provided not only for the settlement of the 1979 condemnation action for the taking of DIBCO's property but also provided for the future condemnation of area of land which included property owned by Commodities and Lubienski, it was not until 1996 that the Government actually initiated eminent domain proceedings to take their properties. By that time, however, the Government had decided not to condemn Commodities' entire property, but rather to take only a small corner of the store's parking lot in fee, and an easement over the parking lot for ingress and egress to a to be constructed Government parking facility on adjacent land, and its Complaint and Declaration of Taking filed on December 5, 1996 reflects this small partial taking. See United States v. 0.074 Acres of Land, Civil Action No. 96-CV-75495-DT.

That the Government decided in 1996 not to take Commodities entire property should have come as no surprise to DIBCO because since May of 1993, i.e., shortly after oral argument before the Sixth Circuit Court of Appeals in Commodities' and Lubienski's appeal of the denial of their motion to intervene, the Government time and again avowed, both in pleadings and in on-the-record hearings that it only intended to take a small portion of Commodities' property. See e.g., Plaintiff's July 18, 1994 Supplemental Brief in Opposition to Intervenor's Motion for Preliminary Injunction:

[I]t has been GSA's expressed intention since May of 1993 to confine the proposed condemnation to the portion of Commodities' property depicted in Exhibit A. . . . GSA intends to condemn only a small portion of the parking lot in fee, for the truck ramp [to the cargo inspection facility.] GSA intends to condemn an additional easement for ingress and egress to a government employee parking lot. The easement would be open at all times to Commodities for its own use. The government parking lot will be constructed on property adjacent to Commodities property . . . .

7/18/94 Supp. Brief, p. 2.

The Government reiterated its intent to take only a small "slice" of Commodities' parking lot at the October 15, 1998 hearing on the parties' cross motions for summary judgment concerning the validity of the MOA. At that hearing, in response to questioning by the Court, GSA's representative Tom Malkin stated:

THE COURT: You have no contemplation of condemning — you, GSA, has no contemplation of condemning Mr. Lubienski's entire property?

MR. MALKIN: We do not.

THE COURT: You do not intend to do that?

MR. MALKIN: No.

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THE COURT: You intend to take the back four blocks [i.e., adjacent property owned by Lubienski]. But you have no contemplation of taking his store property, the Commodities property?
MR. MALKIN: Not the entire property. Just a slice, a slice of the parking lot.

[10/15/98 Hrg. Transcript pp. 70-71.]

Apparently, it was as a result of the Government's decision not to condemn all of Commodities' property and the October 15, 1998 affirmative, on-the-record statements of Mr. Malkin attesting to that fact that DIBCO took the position that the MOA was no longer a binding agreement. See DIBCO's "Supplemental Brief in Opposition to Intervenors' Motion for Summary Judgment and in Support of DIBC's Cross-Motion for Summary Judgment," p. 4. See also the Government and DIBCO's 12/1/00 "Joint Motion to Reschedule Filing of Pretrial Order and Conference," p. 3. Although the Government did for a period of time continue to assert that the MOA remained an enforceable agreement, as of December 4, 2001, the Government's position was also that the MOA is null and void.

Meanwhile, following the Court's decision on the parties' cross-motions for summary judgment, the Government reversed its decision to take only a small slice of Commodities' property, and on January 29, 2001, filed a new Condemnation Complaint and Declaration of Taking, taking Commodities' property in its entirety. See, United States v. 0.41 Acres of Land, et al., No. 01-70391. The complete taking of Commodities did not, however, alter the parties stated positions that the MOA was no longer in effect.

There being no settlement of the 1979 case pursuant to the MOA, the matter was scheduled for trial. Meanwhile, the Commodities parties and the Government indicated their desire to pursue settlement options and were granted leave by the Court to participate in a settlement conference supervised by a magistrate judge. That settlement conference proved helpful and the Government and Commodities ultimately settled the dispute over the taking of Commodities' and Walter Lubienski's two parcels of land.

Upon being advised of the tentative settlement reached by Commodities, Lubienski and the Government, the Court convened a pretrial/settlement conference on November 15, 2001 with all of the parties involved in all four of the condemnation actions. The Commodities parties put their agreed upon settlement of the 1996 and 2001 actions on the record on that date. Pursuant to their agreement, the Government agreed to pay Commodities and Lubienski $14,900,000.00 as just compensation for their two parcels of property.

An Order consolidating all four cases for trial was entered on August 1, 2001. However, because of Commodities' intervention in the 1979 action for purposes of challenging the validity of the MOA, counsel for the parties, however, appeared together for numerous hearings and for in-chambers conferences even before the cases were officially consolidated, particularly through 1999 when the Court rendered its decision on the parties' cross-motions for summary judgment on the issue of the MOA's validity.

The Government and the Commodities parties stipulated that their settlement was conditioned upon the Court granting their joint motion to vacate its July 13, 2001 Opinion and Order Regarding Plaintiff's Motion in Limine to Exclude Commodities' Valuation Testimony.

Settlement negotiations between the Government and DIBCO on that date, however, were not successful. The position of the Government and DIBCO being that the MOA was null and void, the Court set the 1979 action regarding the taking of DIBCO's property for trial on the issue of just compensation due to DIBCO. Trial was originally scheduled to commence on December 4, 2001 but was adjourned upon the request of counsel for DIBCO until February, 2002.

The 1979 DIBCO action was tried before a jury on February 8 — 19, 2002. After two days of deliberation, the jury returned a verdict, and a Judgment was entered upon the jury verdict awarding DIBCO $4,098,174.00, plus interest, as just compensation for the DIBCO property taken by the Government.

Meanwhile, following the appearance of counsel in chambers on December 4, 2001 (the date on which trial was originally scheduled to commence), on December 28, 2001, DIBCO filed the instant Motion to Intervene in the 1996 and 2001 Commodities/ Lubienski cases. The basis of DIBCO's motion to intervene is its belief that the Government might require DIBCO to reimburse it for the settlement of the 1996 and 2001 Commodities and Lubienski property takings. DIBCO contends that if it is found to be responsible for such reimbursement, then it has an interest in the Commodities/Lubienski settlement which it will be unable to protect unless it is granted leave to intervene.

DIBCO states that the Government threatened to impose responsibility for reimbursement from DIBCO for amounts paid to Commodities by the Government during settlement discussions which took place out of the Court's presence on November 15, 2001. The Government, however, explains that during the settlement talks, the Government and DIBCO attempted to undertake a global settlement, which would involve settling the issue of just compensation as well as matters beyond the scope of the condemnation action. The Government states that it

mentioned the possibility of seeking repayment from DIBCO to protect its interests only after DIBCO threatened to sue the United States for breach of contract. . . . Counsel for Plaintiff [the Government] made this statement only in response to a threatened to sue made by counsel for Defendant DIBCO. Since the conclusion of the settlement conference, Plaintiff has taken no formal legal action to seek recovery from Defendant DIBCO for payment of the settlement."
See "Plaintiff's Brief in Support of Consolidated Opposition to Defendant's Motion to Intervene and Plaintiff's Motion to Dismiss DIBCO's Claims and Defenses of Intervention," p. 7 n. 1 (emphasis in original).
The Government's statements in its Brief are consistent with the statements repeatedly made by counsel for the Government during in-chambers conferences — that if DIBCO would "leave it alone," the Government was willing to "walk away" from any further litigation.

On the same date that it filed its Motion to Intervene, December 28, 2001, DIBCO also initiated a separate lawsuit for declaratory and injunctive relief, Detroit International Bridge Company v. United States of America, acting through the General Services Administration, No. 01-CV-75015-DT. In its Complaint, DIBCO argues that

20. Pursuant to the MOA . . . the Government was required and duty bound to acquire the property of Commodities Expert [sic; Export] Company ("CEC") and other properties as part of the Expanded GSA site.

* * *

22. The Government, acting through GSA, breached the MOA by failing to acquire or attempting to acquire all of the properties contemplated by the MOA. . . . Among other things, the Government affirmatively breached the MOA in 1996 by initiating a condemnation complaint against CEC wherein the Government only sought to acquire a small slice of CEC's property and where the MOA . . . required the Government to acquire all of the property of CEC within the Expanded GSA site.

* * *

30. As a result of the Government's breach, the fundamental goals and objectives of the MOA are frustrated.
31. The Government's breach of the MOA extinguishes and relieves DIBC from its obligations under the MOA.

* * *

WHEREFORE, Plaintiff respectfully request that this honorable court issue:
a. A declaratory judgment decreeing that due to the breach of the MOA by the Government and the continuing and executory obligations of DIBC as stated in the MOA are extinguished; [and]
b. That the United States and its agents, attorneys and employees, and each and ever one of them be permanently restrained and enjoined by order of this Court from enforcing or instituting proceedings to enforce the MOA against . . . .
See, Complaint for Declaratory and Other Relief, Civ. No. 01-CV-75025-DT.

DIBCO also argues in its declaratory/injunctive relief action that its property was wrongfully transferred to the Government without payment of just compensation and therefore, its 1979 complaint in condemnation and declaration of taking should be declared null and void and that title should be quieted in favor of DIBCO.

It is essentially these same claims that DIBCO proposes to assert as its Claims and Defenses in Intervention in the Commodities/Lubienski cases. See Exhibit A to DIBCO's Brief in Support of Motion to Intervene in Civil Nos. 96-CV-75494-DT, 96-CV-75495-DT, and 01-CV-70391-DT, pp. 3-4.

III. DISCUSSION

The standards for intervention are set forth in Fed.R.Civ.Pro. 24:
(a) Intervention of Right. Upon timely application anyone shall be permitted to intervene in an action: (1) when a statute of the United States confers an unconditional right to intervene; or (2) when the applicant claims an interest relating to the property or transaction which is the subject of the action and the applicant is so situated that the disposition of the action may as a practical matter impair or impede the applicant's ability to protect that interest, unless the applicant's interest is adequately represented by existing parties.
(b) Permissive Intervention. Upon timely application, anyone may be permitted to intervene in an action: (1) when a statute of the United States confers a conditional right to intervene; or (2) when an applicant's claim or defense and the main action have a question of law or fact in common . . . . in exercising its discretion the court shall consider whether the intervention "will unduly delay or prejudice the adjudication of the rights of the original parties.
DIBCO here argues that it is entitled to intervention as of right. See DIBCO's

Brief in Support of Motion to Intervene, pp. 2-4. There being no statute which confers upon DIBCO an unconditional right to intervene, DIBCO's motion will be considered as arising under Fed.R.Civ.Pro. 24(a)(2).

To qualify for intervention as of right under Rule 24(a)(2), DIBCO must satisfy four criteria. It must establish: (1) timeliness of the application to intervene; (2) a substantial legal interest in the case; (3) impairment of its ability to protect that interest in the absence of intervention; and (4) inadequate representation of that interest by parties already before the court. Michigan State AFL-CIO v, Miller, 103 F.3d 1240, 1245 (6th Cir. 1997), citing Cuyahoga Valley Ry. Co. v. Tracy, 6 F.3d 389, 395 (6th Cir. 1993). See also, United States v. Detroit Int'l Bridge Co., supra, 7 F.3d at 499. Failure to meet [any] one of the four criteria will require that the motion to intervene be denied. Id., quoting Grubbs v. Norris, 870 F.2d 343, 345 (6th Cir. 1989). See also, Stupak-Thrall v. Glickman, 226 F.3d 467, 471 (6th Cir. 2000).

1. DIBCO'S MOTION IS NOT TIMELY

In United States v. Tennessee, 260 F.3d 587, 591-92 (6th Cir. 2001), the Sixth Circuit identified five factors to be guide lower courts in deciding the timeliness issue:

CMRA contends that now is the appropriate time to intervene and that it filed its motions timely because it learned shortly prior to bringing its motions that its interests were not being represented by the existing parties. We have identified several factors to be established in determining whether a request for intervention is timely:
(1) the point to which the suit has progressed; (2) the purpose for which intervention is sought; (3) the length of time preceding the application during which the proposed intervenor knew or reasonably should have known of his interest in the case; (4) the prejudice to the original parties due to the proposed intervenor's failure, after he or she know or reasonably should have known of his interest in the case, to apply promptly for intervention; and (5) the existence of unusual circumstances militating against or in favor or intervention.
Grubbs v. Norris, 870 F.2d 343, 345 (6th Cir. 1989). The determination of whether a motion to intervene is timely should be evaluated in the context of all relevant circumstances. Jansen [v. City of Cincinnati], 904 F.2d [336,] 340 [(6th Cir. 1990)].
260 F.3d at 592; Jordan v. Michigan Conf. of Teamsters Welfare Fund, 207 F.3d 854, 862 (6th Cir. 2000). Applying the foregoing factors to DIBCO's Motion to Interevene in this case, the Court finds that Defendant's Motion is not timely.

As set forth above, the Government and the Commodities Defendants have reached an agreement to settle the 1996 and 2001 Commodities/Lubienski condemnation actions. DIBCO maintains that its motion to intervene is timely filed because it was filed six weeks after it learned of the settlement agreement, an agreement which, DIBCO contends calls for the payment by the Government of an unreasonably large sum of money and which it believes the Government will attempt to hold it responsible for pursuant to the MOA. It is based upon its alleged potential responsibility for the settlement to be paid by the Government to the Commodities Defendants that DIBCO contends it has an interest in the 1996 and 2001 Commodities/Lubienski cases.

DIBCO disputes its responsibility for payment of the settlement in the Commodities cases because of the Government's prior material breach of the MOA. See Brief in Support of Defendant's Reply to Plaintiff's Opposition to Defendant's Motion to Intervene, p. 3, n. 4. Although carefully avoiding in any of its intervention briefs any explanation of precisely what that material breach is, DIBCO did specify the basis for its claims of breach of the MOA on the part of the Government in the Complaint for Declaratory Judgment and Other Relief that DIBCO filed contemporaneously with its filing of the Motion to Intervene in the Commodities/Lubienski condemnation actions.

As indicated, in its Complaint for Declaratory Judgment, DIBCO alleged that the Government was required and duty bound under the MOA to acquire the property of Commodities and that it affirmatively breached the MOA in 1996 by initiating a condenmation complaint against Commodities in which the Government sought to only to acquire a small slice of Commodities property rather than the property in its entirety. See Complaint for Declaratory Judgment and Other Relief, ¶¶ 20, 22. Based upon this alleged prior material breach, DIBCO seeks to intervene in this action to obtain entry of a declaratory judgment which "determine[s], declare[s] and adjudge[s] that DIBC[O] has not duty to reimburse the Government for settlement of [the Commodities/Lubienski condemnation cases] under the MOA." See DIBCO's proposed Claims and Defenses in Intervention, p. 3.

DIBCO's request for a declaratory judgment that the Government's decision to take only a slice of Commodities' property rather than to condemn all of the property constituted a material breach of the MOA which absolved DIBCO of any responsibility to reimburse the Government for the costs of acquisition of property within the Expanded GSA Site — including for any settlement entered into with respect to Commodities as well as with Mr. Lubienski for his property adjacent to Commodities — could have been made by DIBCO in 1996 when the Government filed its 1996 Complaint and Declaration of Taking in Civil Action No. 96-CV-75495-DT which declared that the Government was taking of only a slice of Commodities' parking lot. DIBCO participated in numerous hearings and conferences subsequent to the filing of the 1996 action and was present in October 1998 when, in open court, GSA's representative, Tom Malkin, affirmatively stated on the record during the summary judgment hearing to determine the validity of the MOA that GSA had no intention of taking all of Commodities; that it only was going to take a slice of the parking lot. Thus, DIBCO "knew or reasonably should have known" of its purported interest in the Commodities/Lubienski condemnation cases if not in 1996, at least as of October 1998.

As the Sixth Circuit observed in affirming the district court's denial of a motion to intervene in Stotts v. Memphis Fire Dept., 679 F.2d 579 (6th Cir.), cert. denied, 459 U.S. 969 (1982), the intervention applicants "should have attempted to intervene when [it] first became aware of the action, rather than adopting a `wait-and-see' approach." 679 F.2d at 584 n. 3. This is precisely what DIBCO has done here. Assuming arguendo that DIBCO has an interest in the 1996 and 2001 actions, It has known of that interest for more than four years. It knew for more than four years that the Government was only going to condemn a small portion of Commodities' property in the 1996 action and, therefore, it knew for more than four years of the Government's alleged breach of the MOA. The only difference now is that, after taking a "wait-and-see" stance, DIBCO knows of the amount of just compensation to be paid to the Commodities Defendants. The basis of its arguments in avoidance of responsibility for payment of that sum remains the same now as it did in 1996 and 1998.

Furthermore, intevention by DIBCO at this point would prejudice the other parties. As indicated, the Government ultimately reversed its decision to take only a small portion of Commodities' property and decided to take all of Commodities' property, after all. See United States v. 0.41 Acres of Land, No. 01-CV-70391-DT (Complaint and Declaration of Taking filed January 29, 2001). Therefore, DIBCO's principal reason for intervening in this case, i.e., to argue that it is excused from its obligations under the MOA because of the Government's material breach of the agreement by not taking all of Commodities' property, has evaporated. Moreover, the Government and the Commodities Defendants have settled the matter of just compensation for the complete taking of Commodities' and Lubienski's properties. The settlement contemplates a change of possession of the property on March 1, 2002. To this end and in reliance on the settlement, Commodities has begun the process of winding down its business and the Government has begun the process of preparing for the integration of Commodities' property into the federal project. To delay the settlement now "may force the parties into collateral litigation" over issues that need not arise. See U.S. v. Tennessee, 260 F.3d at 594.

Based upon the foregoing, the Court finds that DIBCO's Motion to Intervene in the 1996 and 2001 Commodities/Lubienski cases is not timely.

2. DIBCO DOES NOT HAVE A SUBSTANTIAL INTEREST IN THE COMMODITIES/LUBIENSKI CONDEMNATION CASES

A proposed intervenor must demonstrate that it has a "direct, significant, legally protectable interest" in the action into which he seeks to intervene. United States v. Detroit Int'l Bridge Co., supra, 7 F.3d at 501. See also, Grubbs v. Norris, supra, 870 F.2d at 346 ("an intervenor must demonstrate that he or she has "a direct and substantial interest in the litigation"). This interest also must be "significantly protectable." Diamond v. Charles, 476 U.S. 54, 68 (1986).

DIBCO attempts to make out its claim of an interest in the Commodities/Lubienski condenmation actions by arguing that its position here is indistinguishable from that of Commodities and Lubienski when they sought, and were ultimately found to be entitled, to intervene in the 1979 action when settlement of that case was contemplated under the MOA. The Court of Appeals found that Commodities and Lubienski had a "direct, significant, legally protectable interest" in the subject matter of the 1979 action because "the MOA clearly provide[d] for the condemnation of Commodities and Lubienski's property and serve[d] as a final settlement of the 1979 condemnation action" brought by the Government for the taking of DIBCO's property. 7 F.3d at 501 (emphasis added). It was because Commodities and Lubienski faced condemnation of their own real property pursuant to the MOA (which was intended as a settlement agreement for the 1979 DIBCO condemnation action) that the Sixth Circuit found that Commodities and Lubienski had a substantial interest in the 1979 action.

Here, by contrast, DIBCO's alleged interest does not arise through the condemnation of the properties at issue in the 1996 and 2001 actions. Rather, its alleged interest is wholly contract-based and not related to the taking of any property involved in these cases. Although DIBCO attempts to make out an "interest" by presupposing that "it will" be responsible for the payment of the settlement of the Commodities/Lubienski actions, such a claim is wholly contingent upon the Government making a demand for such reimbursement and filing a lawsuit seeking repayment for the settlement amount, and further contingent upon the Government succeeding in persuading the court of the continued viability of the obligations of DIBCO under the MOA now that the principal purpose of that agreement — the settlement of the 1979 action — no longer exists. Absent a lawsuit, however, DIBCO's claimed interest is insufficient for demonstrating a direct, substantial interest under Rule 24. See Washington Elec. Coop., Inc. v. Mass. Mun. Wholesale Elec. Co., 922 F.2d 92, 97 (2nd Cir. 1990) (an interest "that is contingent upon the occurrence of a sequence of events before it becomes colorable will not satisfy the rule"). See also, Silver v. Babbitt, 166 F.R.D. 418 (D. Ariz. 1994), aff'd, 68 F.3d 481 (9th Cir. 1995) (denying intervention because interest would not vest until the U.S. Fish and Wildlife Service undertook several post-litigation actions).

Moreover, DIBCO's motion to intervene is inconsistent with the purpose of Fed.R.Civ.Pro. 24. Rule 24 "is not intended to allow for the creation of whole new lawsuits by the intervenors." Deus v. Allstate Ins. Co., 15 F.3d 506, 525 (5th Cir. 1994) (citing Washington Elec. Coop., Inc., supra). As the Second Circuit emphasized in the Washington Electric case, "Intervention cannot be used as a means to inject collateral issues into an existing action." 922 F.2d at 97. This is precisely what Defendant DIBCO is attempting to do in this case. DIBCO is attempting to adjudicate issues of contract interpretation which have nothing to do with the condemnation of the parcels of real property at issue in the Commodities/Lubienski cases.

Further, to the extent that DIBCO argues an interest in the Commodities/Lubienski cases based upon the fact that the settlement in those cases contemplates the Court's vacating of its July 13, 2001 Valuation Order, DIBCO has cited no authority (nor has the Court independently found any such authority) standing for the proposition that an interest in the preservation of an interlocutory legal ruling — which the court, in its discretion may modify or rescind at any time — constitutes an "interest" for purposes of Rule 24. See Jalapeno Property Management, L.L.C. v. Dukas, 265 F.3d 506 (6th Cir. 2001) (the decision to modify or rescind its prior interlocutory orders is a matter which rests within the sound discretion of the court).

The July 13, 2001 Opinion and Order in question denied the Government's Motion in Limine filed in the 1996 Commodities "slice" case, to exclude evidence of the value of Commodities Export Company. The Opinion had nothing to do with DIBCO's valuation of its own property which was the subject of the 1979 action. The Opinion imposed no obligations on DIBCO and did not determine its rights, positively or negatively.

The issuance of an opinion and order does not create any vested right or interest in the opinion. As this Court stated in its Opinion and Order of December 27, 2001, a court has wide latitude to reconsider and vacate its prior opinions and orders. See, United States v. Certain Land, 178 F. Supp.2d 792, 797-99, 804 (E.D. Mich. 2001). The July 13, 2001 Opinion and Order in question is interlocutory in nature and, as such, is subject to revision at anytime pursuant to Fed.R.Civ.Pro. 54(b). Id. See also, John Simmons Co. v. Grier Brothers Co., 258 U.S. 82, 88 (1922) (court at any time prior to entry of final judgment may modify or rescind interlocutory orders). Cf., Clem v. Eribaum, 584 F. Supp. 908 (E.D. Pa. 1984), aff'd, 770 F.2d 1067 (3rd Cir.), cert. denied, 747 U.S. 849 (1985) (ruling on motion in limine is interlocutory in nature).

Presumably, DIBCO's desire to prevent the vacation of the July 13, 2001 Opinion and Order was to argue it as the basis for admission of evidence of lost profits on the Ambassador Bridge in its own 1979 condemnation action. However, as the Court stated in refusing to allow DIBCO to admit such lost profits in the trial on the 1979 case, in the Commodities case — which was the subject of the July 13, 2001 Opinion and Order — it was because the Government's taking put Commodities out of business with no possibility of relocating the business to another site that the Court held that evidence of Commodities lost revenues would be admissible. That holding would have had no applicability in the DIBCO condemnation action where the Government's taking did not put the Ambassador Bridge out of business.

The foregoing discussion makes clear that DIBCO has no "direct, significant, legally protectable interest" in the Court's July 13, 2001 Opinion and Order such that it should be permitted to intervene in the Commodities/Lubienski condemnation actions to oppose the Court's vacation of the Opinion and Order.

3. DIBCO'S ABILITY TO PROTECT ITS ALLEGED INTEREST WOULD NOT IMPAIRED IN THE ABSENCE OF INTERVENTION

Assuming arguendo that DIBCO has demonstrated a protectable interest under Rule 24 by virtue of its potential responsibility for the payment of the settlement of the Commodities/ Lubienski actions under the MOA, the third requirement for intervention as of right requires DIBCO to establish that without intervention in the Commodities/ Lubienski cases, its ability to protect this interest would be impaired. It is clear that DIBCO cannot meet this requirement because it has another avenue available to it — and indeed, has already taken advantage of that avenue — by filing a separate action in which it has raised the very same issues which it seeks to raise through intervention in this action. "Intervention generally is not appropriate where the applicant can protect its interests and/or recover on its claim through some other means." Deus v. Allstate Ins. Co., supra, 15 F.3d at 526.

As discussed above, on the same day that DIBCO filed its motion to intervene, it also instituted an entirely new action in which it raises substantially the same claims it seeks to litigate as intervenors in the Commodities/Lubienski cases. DIBCO asks the Court, both in its Claims and Defenses in Intervention and in its Complaint for Declaratory Judgment and Other Relief, to find that the Government materially breached the MOA and, as a consequence, DIBCO is relieved of its obligations under the MOA to reimburse the Government for payment of the Commodities/Lubienski settlement.

DIBCO, thus, has a ready avenue in the separate action it has already filed in which to dispute its responsibility for payment of the Commodities/Lubienski settlement as well to challenge the reasonableness of the amount it may be required to pay. Having another means to obtain the relief it seeks to obtain by intervention in the Commodities/ Lubienski condemnation actions, DIBCO cannot show that absent intervention its ability to protect its interest will be impaired if it is denied leave to intervene.

CONCLUSION

For all of the reasons stated above in this Opinion and Order, the Court finds that DIBCO has failed to establish that it is entitled to intervene as of right in the 1996 and 2001 Commodities/Lubienski condemnation actions. Accordingly,

IT IS HEREBY ORDERED that Detroit International Bridge Company's Motion to Intervene in Civil Nos. 96-CV-75494-DT; 96-CV-75495-DT; an 01-CV-70391-DT is DENIED.

ORDER VACATING OPINION

Pursuant to the Joint Motion To Vacate Order And Opinion jointly filed herein by the Plaintiff, United States of America, and the Defendants, Commodities Export Company and Walter H. Lubienski, IT IS HEREBY ORDERED AND ADJUDGED THAT:

1. The Court's July 13, 2001 order and opinion in United States v. Certain Lands Situated in the City of Detroit, Civ. No. 79-73934, 96-75494, 96-75495, 01-70391, as published in the Federal Supplement asUnited States v. Certain Lands Situated in the City of Detroit, 148 F. Supp.2d 863 (E.D. Mi. 2001), is hereby ordered vacated and withdrawn. All necessary and required procedures to insure that the opinion as published is vacated and withdrawn shall be effected.


Summaries of

U.S. v. Certain Land Situated in the City of Detroit

United States District Court, E.D. Michigan, Southern Division
Feb 27, 2002
Nos. 79-CV-73934-DT (E.D. Mich. Feb. 27, 2002)
Case details for

U.S. v. Certain Land Situated in the City of Detroit

Case Details

Full title:UNITED STATES OF AMERICA, Plaintiff, v. CERTAIN LAND SITUATED IN THE CITY…

Court:United States District Court, E.D. Michigan, Southern Division

Date published: Feb 27, 2002

Citations

Nos. 79-CV-73934-DT (E.D. Mich. Feb. 27, 2002)