It’s not an uncommon sight, especially in light of the burst of the housing bubble in recent years: a debtor in bankruptcy has two mortgages on a property with a fair market value of less than the amount of the senior mortgage. The junior mortgage lien is then wholly underwater, so that creditor would receive nothing from the sale of the property. The question then becomes, can the debtor void those liens in a Chapter 7 bankruptcy proceeding? The Supreme Court, in an increasingly rare show of unanimity, said “No.”

Inverse condemnation is a far more complex subject than it may seem at the outset. While condemnation proceedings are initiated by the government to acquire property and pay the owner just compensation, the general rule regarding inverse condemnation is that the owner of the property, and not a government entity, seeks to recover damages for a loss in value of the property as a result of governmental action. There are several avenues from which this type of action can arise, as there are multiple ways property can be affected by government activity. Rather than there being a cut and dried standard for what inverse condemnation looks like, each case involving it arises is based on a set of unique factual circumstances.

In Obergefell v. Hodges, the United States Supreme Court, in a 5-4 opinion, determined that prohibitions on same-sex marriage are an unconstitutional infringement of Fourteenth Amendment rights. This decision throws the doors open for same-sex marriages, affording same-sex married couples the same rights and privileges only enjoyed by opposite-sex couples until recently. This expansion of marriage allows same-sex couples to take advantage of certain legal benefits, and property law is no exception. Same-sex married couples may now hold property in a tenancy by the entirety, a form of title available exclusively to married couples owning together.

You have likely seen the commercials for reverse mortgages. While the advertisements urge viewers to “call now to secure you reverse mortgage today” and make them seem risk-free, obtaining a mortgage of this type is a serious decision that should not be made without fully understanding its pros and cons.

Development in flood prone areas is regulated by a combination of federal, state and local regulations to reduce the possibility of loss of life and property, and to reduce the cost associated with development and rebuilding in these areas. The Federal Emergency Management Agency (“FEMA”) publishes flood maps that identify the regulatory floodplain. Congress has enacted various changes to existing legislation to discourage development in special hazard areas and to facilitate the purchase of flood insurance in by property owners in flood prone areas. Under current laws, communities that want to make national flood insurance available to its residents must participate in the National Flood Insurance Program. This required communities to adopt certain minimum standards that regulate development in areas that are prone to flooding, including standards that prohibit new development in special hazard areas.

Fewer words in the context of land use planning come with as negative a connotation as “sprawl.” There’s a good reason for this, as the term denotes a move outwards from the heart of a city, pushing communities further apart into low density suburbs while the core of the area falls into decay. Sprawl has been cited as the cause for everything from environmental damage to community segregation, with inherently negative consequences for cities that fail to plan for sustainable growth. To combat sprawl, however, communities have turned to creative and innovative revitalization efforts such as infill and adaptive reuse as a way to slow the outward push and revitalize existing residential, commercial and even industrial spaces.

Prior posts have discussed initial considerations in the purchase of commercial real estate and conducting due diligence prior to closing the deal. Today’s focus will now turn to contingencies often found in commercial real estate contracts.

When we think of subdivisions, we generally think of large housing estates with a house on each lot, but technically the subdivision of land means the creation of saleable lots by splitting a tract into smaller parcels. In communities that have adopted land use regulations, the subdivision of property is typically handled by submitting a subdivision plat to the planning commission in the jurisdiction where the property is located. The subdivision of land is considered a ministerial matter. This means that if the proposal meets the minimum requirements of the zone in which it is located, the planning commission must approve it. Unlike rezoning of property, which requires notice to surrounding property owners and a full due process hearing, a subdivision plat does not trigger notice and hearing procedures. Typically all that is required is submission of a subdivision plat that meets the minimum requirements set out in the zoning ordinance and land subdivision regulations as well as the payment of a processing fee. Under Kentucky law, the planning jurisdiction has the power to assign the review and approval of subdivision plats to a staff person. After a plat is approved, it is recorded in the county clerks’ office. A recorded subdivision plat creates the new lots. No new lot can be sold until after the subdivision plat is recorded.

The comprehensive plan is the most important tool in land use planning. In its most basic function, it provides a roadmap for the development of a community’s most limited resource, the land itself. More than just a rigid set of directions, however, the comprehensive plan lays out a community’s vision for the future, providing guidance as to how the community will grow and thrive while striking an appropriate balance between competing uses.

The most enduring maxim of any transaction is “caveat emptor,” therefore a key element of any commercial real estate transaction is due diligence on the part of the purchaser. A thorough investigation into the fundamentals of the property, the seller, the financing and the deal itself is the most crucial form of protection a purchaser has. Such an investigation exists to prevent surprises that might arise post-transaction. This post will briefly cover some essential elements of due diligence in the commercial real estate transaction.