Property

Disputed property taking headed to Indiana Supreme Court | State

The Indiana Supreme Court has agreed to decide whether the Gary Housing Authority followed proper procedures when it acquired through condemnation a since-demolished restaurant building at 624 Broadway.

The state’s high court issued an order Thursday granting transfer in the case and vacating a Dec. 27, 2021, Court of Appeals ruling that negated the Gary Housing Authority’s administrative taking of the property.

That actually was the second Indiana Court of Appeals decision in this case.

The first, which similarly ruled against the housing authority, was scuttled by Court of Appeals Chief Judge Cale Bradford on Dec. 2, 2021, three days after an article in The Times suggested the appeals court may have mistakenly applied the 2021 version of the eminent domain statute, instead of the statute in effect when the case commenced in 2019.

Now that the Supreme Court has agreed to hear the case, both the Gary Housing Authority, represented by Tramel Raggs and others, and 624 Broadway LLC, represented by Robert Welsh and Connor Nolan, will submit written arguments to the court in the months ahead, and get a chance to address and answer questions posed by the five justices at oral arguments, probably by the end of the year.

According to court records, the Gary Housing Authority is supported at the high court by nine additional Indiana municipal housing authorities, including the East Chicago Housing Authority.

A Supreme Court ruling is expected sometime in 2023.

At issue is whether the housing authority provided sufficient notice to the property owner prior to taking the property.

In its most recent ruling, the Court of Appeals said despite complying with the notice by publication provisions of Indiana law in effect at the time, the Gary Housing Authority had a further obligation under the U.S. Constitution to make an extra effort to directly contact John Allen, the registered agent for the building owners.

While the appeals court noted Allen managed to learn about the two condemnation hearings and attend them anyway, the court said it cannot say with confidence the Gary Housing Authority only would have paid $75,000 for the building had the proper procedure been followed, since Allen did not have an opportunity to present an appraiser’s valuation of $325,000 for the property.

As a result, the appeals court said it was vacating the Gary Housing Authority’s administrative taking of the property because it violated 624 Broadway’s constitutional rights, and it ordered the Lake Superior Court to conduct further proceedings consistent with the ruling.

“Under the circumstances, the Gary Housing Authority’s use of notice by publication was not reasonably calculated to reach Allen. Rather, the Gary Housing Authority’s use of notice by publication was a mere gesture, which is not due process,” said Appeals Judge Paul Mathias on behalf of the court.

Records show Allen was in the midst of renovating the building into the Nations Restaurant and Bar when the property was acquired by the Gary Housing Authority.

The housing authority in 2020 tore down the building, as well as the other structures in the 600 block of Broadway, as a prelude to constructing a new, mixed-use housing development in downtown Gary.

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