State v. Goldberg

At issue in this case was Chapter 286 of the 2007 Session Laws of Maryland. The legislation revised existing law by replacing ejectment with a lien-and-foreclosure process for defaulting lessees of ground leases when more than six months of rent is overdue. Plaintiffs, a group of lessors holding ground leases, brought an action against the State challenging Chapter 286 on constitutional grounds, claiming that the Legislature impermissibly abrogated their vested rights. The State counted that the legislation simply substituted one remedy for another remedy that achieves the same purposes. The circuit court held that the General Assembly exceeded its power and that Chapter 286 operated as an unconstitutional taking of the ground lease holder’s property. The Court of Appeals affirmed, holding (1) the foreclosure-and-lien remedy of Chapter 286 does not provide the same safeguards for leaseholders as the prior ejectment remedy did; (2) accordingly, the foreclosure-and-lien remedy cannot effectively replace the ejectment remedy, which is essential for the right of re-entry in Maryland ground rents; and (3) thus, Chapter 286 cannot survive constitutional scrutiny because the right of re-entry is vested in ground rents entered prior to its enactment. View "State v. Goldberg" on Justia Law