The Utah Supreme Court has ruled against the dismissal of a lawsuit saying the Washington County School District should have offered land to a company it purchased the land from before selling it to someone another, in an opinion issued Thursday. (Kristin Murphy, Deseret News)
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SALT LAKE CITY — The Utah Supreme Court has ruled in favor of a Southern Utah company in a legal dispute where the company claimed the Washington County School District should have offered to sell the land to the company first, since the district had purchased the land from him. under threat of eminent domain.
This decision reverses the dismissal of the lawsuit by the district court.
The high court opinion, which was released on Thursday, says Cardiff Wales LLC claims it originally sold a plot of land to the Washington County school district “to avoid an eminent domain lawsuit” that the school district had threatened.
At the time, Cardiff Wales planned to develop the property – approximately 24 acres in Washington City – and was working with the city to obtain permits to develop the land. The notice says the school district sent a letter suggesting it would use eminent domain to obtain the property if a sale did not occur.
About a decade after the Washington County School District acquired the property, where it had planned to build two schools, it decided to sell it to a third party, according to the filing. Cardiff Wales only learned of the sale after it was finalized and argued it should have had the right of first refusal to redeem the property.
“Utah law requires a government entity to offer property acquired by conviction or threat of conviction to the original owner before disposing of it,” the opinion explains.
The company sued, arguing that this law should apply. But a 5th District Court judge ruled there was never a threat of a conviction from an official body in that instance and dismissed the case.
Cardiff Wales appealed the ruling, and the Utah Court of Appeals accepted the district court’s ruling, saying a threat of eminent domain requires a government entity to “specifically authorize” the taking. The appeals court said this required a vote to approve the filing of an eminent domain complaint.
But the Utah Supreme Court overturned that decision, saying Utah laws do not support the appeals court’s interpretation of what it means to be “specifically authorized.”
“The Court of Appeals correctly held that property is not sold under ‘threat of condemnation’ unless the government entity specifically authorizes the use of eminent domain. The Court of Appeals held however, erred when it concluded that a government entity must approve the filing of an eminent domain complaint to specifically authorize the use of the conviction,” the notice reads.
The ruling sends the case back to the 5th District Court for reconsideration now that the case is no longer dismissed.