When can a landowner challenge property transfer?

In Minnesota, the sale or transfer of adjacent property in commercial real estate transactions can hold consequences for neighboring business. Accordingly, in some cases, a party may challenge an action such as land conveyance.

This may occur when the party has a sufficient stake in the matter to seek relief from a court so that the issues before the judiciary may be vigorously and adequately presented. A property owner may have standing in a court case when it has suffered an injury or if a law grants this standing in specific circumstances.

The state Supreme Court recently ruled that a neighboring property owner was injured-in-fact and had standing to participate in litigation concerning the conveyance of land owned by the State to a private company for the construction of senior housing and multi-family apartments. This property owner sought an injunction blocking the sale or to compel the State to transfer the land to it or to the highest bidder at an auction or sale.The neighboring property owner an interest in one of the parcels conveyed from a previous owner and owned an adjoining property.

The Court ruled that this property owner had a concrete interest in bidding on the property which was not held by the general public. If the State’s conveyance of the land at issue was not challenged, the neighboring property owner would lose its chance to bid on that land.

Participating in this type of litigation, however, may add burdens to a party. In this case, for example, the Court required the adjoining property to post a surety bond because there was evidence of potential lost investors and tax revenue to the State because of the litigation.

Because commercial real estate issues are not limited to the original purchase of the property, as this case illustrates, legal assistance should be ongoing. This may assure the continued growth and profitability of a business.

Source: Justia US Law, Webb Golden Valley, LLC v. State of Minesota, et al., No. A13-2044 (July 1, 2015), Assessed July 6, 2015

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