Housing authority gets big win
August 25, 2008
ASPEN ” A district court judge has issued a blow to Arnold Meyerstein’s lawsuit against the Aspen/Pitkin County Housing Authority.
In 2002, Meyerstein bought Ute City Place, an affordable-housing complex at 909 E. Cooper Ave., for $2.1 million.
In April, Meyerstein filed a lawsuit arguing that the agency’s deed-restriction controls were both unconstitutional and were a “takings” of his property.
It’s the second such suit Meyerstein filed in recent years; the other was on a deed-restricted property at Aspen Highlands.
On Aug. 13, however, Judge Kelly Lynch dismissed Meyerstein’s two claims for damages, ruling the deed restrictions had long been in place and the statute of limitations had expired.
“It’s a big deal,” said the housing agency’s attorney, Thomas Fenton Smith. “We know that there aren’t going to be damages.”
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Smith said he’s confident the agency will also win on two other claims in the suit that seek to overturn the deed restriction on Meyerstein’s property, a legal move Smith called the “Telluride defense.”
A state statute dating back to 1981 prohibits any government rent control, Smith said, unless a government agency has an interest in the property.
The defense, Smith said, is a legal strategy based on the Colorado Supreme Court’s decision in 2000 that invalidated the town of Telluride’s affordable-housing guidelines; the justices ruled that the guidelines violated the 1981 prohibition on rent control.
Smith, however, said there is also a local precedent to support deed restriction.
In the recent Lawrence case, Lynch upheld local deed restrictions because the city of Aspen had entered into an agreement with the owner, Smith said.
Meyerstein’s attorney, Herb Klein, said the judge’s recent order is a mere stumbling block and that the fight isn’t over.
“We disagree with the judge’s decision,” Klein said. “This is the type of case that is ultimately going to be resolved at the appellate courts.”
Klein said the housing authority forced its own “interest” in Meyerstein’s property by creating the deed restriction requirement in the first place.
“The statute does not define what an ‘interest’ is,” Klein said.
And the housing authority claimed the deed restriction itself ” the very thing Meyerstein hoped to overturn ” as the reason they should be exempt from the state statute prohibiting deed restrictions.
“We think there are some problems with that decision because it completely neuters that statute,” Klein said.