The Oregon Supreme Court ruled this week in Oswego that when a local historic designation is imposed on a property, only the property owner Lake Oswego Preservation Society v City of Lake at the time the restriction is imposed has the right to remove that designation under ORS 197.772. If the original property owner does not exercise this right, subsequent property owners who acquire the property will remain subject to the designation and any accompanying restrictions.
In this case, a subsequent property owner challenged in 2013 an historic designation that had been in place since at least 1992. The court examined the statutory text in context along with its legislative history (including a lengthy discussion of the meaning of the word “a” as compared to the term “the”). A key part of that context was a legislative requirement that local governments create and implement comprehensive plans and regulations to protect historically significant properties, incorporated in 1996 into Statewide Planning Goal 5, which required the identification and preservation of historically significant properties. If ORS 197.772 applied to subsequent property owners, such a result would effectively dismantle the established statutory and regulatory framework for the Goal 5 protection of historic properties, which the Legislature would not have intended. The court noted that when an historic designation is placed upon a property for the first time, the designation can significantly, and sometimes negatively, impact the property.
ORS 197.772 provides the original owner with a right to refuse the designation to protect that owner’s reasonable expectations as to the use of the property at the time the designation was imposed. Subsequent owners acquiring the property with notice of the designation and, “most likely, at a price or valuation that reflects the designation” have no reasonable expectation of using the property in a manner inconsistent with that designation and therefore suffer no harm to their property interests.
Contact: Carl Sniffen, Assistant General Counsel – firstname.lastname@example.org