In the case Burkhart Advertising Inc. v. City of Fort Wayne, Burkhart leased property on which to install a billboard. The 10-year lease provided that, if Burkhart were forced to remove its billboard due to condemnation, it would be entitled to damages from the governmental entity taking the property.

The lease also provided that if the property’s owner elected to construct a permanent building on the property, the owner had the right to terminate the lease and refund Burkhart Advertising Inc. any prepaid rents, so long as construction commenced within 90 days. (If construction did not commence within that time period, the lease gave Burkhart the right to reinstall its billboard.)

The owner also had the right to cancel the lease on the occurrence of other events outside its control.

Five years into the lease, the property’s owner initiated plans to develop an office park on the property and applied for zoning and construction permits from the city. The city approved the property owner’s development plans on the condition that Burkhart’s billboard be removed.

The property owner then notified Burkhart that the billboard lease was being terminated and, when Burkhart did not remove the billboard, filed suit to force the billboard’s removal.

Burkhart, in turn, sued the city, claiming that the city had violated the Fifth Amendment of the Constitution by improperly "taking" its property (via conditioning zoning approval on the billboard’s removal) and had damaged Burkhart by interfering with its contract with the property owner.

Although the property owner soon abandoned its plans to develop the office park, Burkhart continued its lawsuit against the city. At trial, the court ruled in favor of the city, pointing out that the billboard was still in place and opining that if the property owner were again to apply for permission to build on the property, the only remedies available to Burkhart are those provided under contract law and the lease with property owner.

In a published opinion, the Court of Appeals of Indiana upheld the lower court’s ruling. Because the billboard lease allowed for the property owner to terminate the lease for construction of a permanent building, the court explained, Burkhart would have been required to remove the billboard whether or not the city made the billboard’s removal a condition of its zoning and building permits.

Accordingly, Burkhart did not even possess a compensable interest in the property, as required to make a valid claim under the Fifth Amendment. Additionally, the city did not interfere with or alter the terms of Burkhart’s lease, which was a lease on the advertising company’s own boilerplate form of contract.

As a result, the Court of Appeals ruled, the city did not improperly take Burkhart’s property, and the trial court’s ruling was affirmed.

Tara-Nicholle Nelson is author of "The Savvy Woman’s Homebuying Handbook" and "Trillion Dollar Women: Use Your Power to Make Buying and Remodeling Decisions." Ask her a real estate question online or visit her Web site,


What’s your opinion? Leave your comments below or send a letter to the editor. To contact the writer, click the byline at the top of the story.

Show Comments Hide Comments


Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Thank you for subscribing to Morning Headlines.
Back to top
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription