March 9

2011 Update – North Carolina Condemnation Cases

0  comments

First Annual North Carolina Eminent Domain Case Update

This is the first annual update by CarolinaCondemnationLaw.com of North Carolina condemnation cases. The cases listed below include all North Carolina eminent domain cases in both State and Federal appellate courts (i.e., cases from North Carolina in the North Carolina Court of Appeals and North Carolina Supreme Court as well as the United States Court of Appeals for the Fourth Circuit and the United States Supreme Court).

(In 2011, there was also one condemnation case reported from the United States District Court for the Western District of North Carolina, and it is also summarized.)

For each case below, there is a very brief summary that includes key holdings. These cases, of course, frequently contain other important points, so you may want to read the entire text of each case. To make that easier, each summary includes links to the case at the website of the relevant appellate court. Plus, for those of you with Westlaw or Lexis accounts, there are also links to each case on those services. Finally, many of these cases already have individual posts of their own here on CarolinaCondemnationLaw.com. So, for those cases, you will also find links below to their respective posts on the Cases page.

City may condemn gas easements it has no immediate plan to use

Town of Midland v. Morris, ___ N.C. App. ___, 704 S.E.2d 329 (Jan. 18, 2011)

In this complicated gas line case, the North Carolina Court of Appeals held that

  1. the Town could condemn easements even without a “concrete, immediate plan” to use them; and
  2. the Town’s condemnation of the gas easements met both the “public use” and the “public benefit” tests.
The Court of Appeals also addressed several other, peripheral issues, including
  • the owner’s standing;
  • compliance with the Voluntary Agricultural District statutes and the corresponding local ordinance; and
  • the legality of using the easements acquired by the Town to supply gas to people outside the Town.

Links to this case

108 Hearings Require Findings of Fact

City of Charlotte v. Williams, ___ N.C. App. ___, 707 S.E.2d 710 (Mar. 1, 2011)

A property owner moved for a 108 hearing, asking the trial court to determine, among other things, that before the City filed its condemnation case, she had acquired another parcel adjacent to the subject property through adverse possession.  After the 108 hearing, the Trial Court denied the property owner’s adverse possession claim, but did not make any findings of fact. The North Carolina Court of Appeals held that the Trial Court’s simple denial of the owner’s motion failed to comply with N.C. Gen. Stat. §136-108, and, therefore, the Court of Appeals remanded the case to The trial Court “for entry of a new order containing adequate findings of fact and conclusions of law.”

Links to this case

Airport cannot use Rule 70 to Declare Rights under Consent Judgment for Avigation Easement

Sampson County and City of Clinton v. Parker Family Real Estate, LLC, ___ N.C. App. ___, 711 S.E.2d 876 (Apr. 19, 2011) (unpublished)

Sampson County and the City of Clinton jointly condemned an avigation easement for a public airport, and the parties settled the case with a consent judgment. The judgment, however, did not require the property owner to do anything, like keep trees from growing inside the easement. When a danger tree grew inside the avigation easement, the condemnors sought to enforce the consent judgment by filing a motion in the cause under Rule 70. But the text of the motion really sought a declaratory judgment. The Trial Court granted the motion and decreed that the condemnors

“shall have the right to remove at the ground the entire tree if any portion of said tree extends into the airspace to which the Avigation Easement applies.”

The North Carolina Court of Appeals vacated that order. The Court of Appeals pointed out that Rule 70 contemplates “enforc[ing] a judgment that directs a party to perform a specific act”, but in this case,

“because the consent judgment that is being ‘enforced’ does not direct [the Property Owner] to perform any specific act, Rule 70 is inapplicable.”

The Court of Appeals went on to hold that Rule 70 could not be used to have the Trial Court declare the rights of the parties.

Links to this case

Lost Revenue Damages from Inverse Condemnation of Riparian Rights

L & S Water Power, Inc. v. Piedmont Triad Regional Water Authority, ___ N.C. App. ___, 712 S.E.2d 146 (Apr. 19, 2011)

This is the latest condemnation case involving the Randleman Dam and Lake, a reservoir project straddling Guilford and Randolph Counties and constructed on the Deep River by the Piedmont Triad Regional Water Authority (the “Water Authority”).  In this case, several hydroelectric power producers downstream of the dam filed an inverse condemnation action, alleging that the Water Authority had reduced the water flow of the Deep River past their facilities and had thereby taken the power producers’ riparian rights without filing a standard condemnation case or depositing any estimate of just compensation.

The Court of Appeals affirmed the Trial Court’s holding that the defendant Water Authority had taken plaintiff’s riparian rights and that plaintiffs were entitled to compensation for that taking based on the reduction in hydroelectricity that plaintiffs could produce.

Links to this case

Inverse Condemnation from Damage to Remainder?

Town of Apex v. Whitehurst, ___ N.C. App. ___, 712 S.E.2d 898 (Jul. 19, 2011)

Can damages to the remainder lead to an inverse condemnation, and therefore, let a property owner recover attorney’s fees and costs? Can a partial taking of a sanitary sewer easement result in a total take of the whole property?  Was this sanitary sewer easement taking for a public purpose?

Although the North Carolina Court of Appeals stepped through a lengthy procedural analysis, it ultimately ruled that the property owners’ interlocutory appeals from summary judgment and a 108 hearing determination were too late.  So, the Court of Appeals dismissed them.  With respect to the appeals on the public purpose and inverse issues, the Court of Appeals held that although the Trial Courts’ decisions were interlocutory, these issues were of

“vital importance”

and

“affect[ed] a substantial right”.

Thus, the owners had a right, and, therefore, an obligation to appeal from those interlocutory rulings within 30 days of their entries. Because they did not do so, their appeals were untimely and were dismissed.

With respect to the total take issue, the owners failed to make any arguments on appeal, so the Court of Appeals dismissed it as well.

Also, in a footnote, the Court of Appeals suggested an alternative method of defending an inverse claim, like the one in this case, in which the owners failed to follow the procedures required by the inverse statute, N.C. Gen. Stat. § 136-111.

Links to this case

Inverse Condemnation based on Uneconomic Remnant; Admission of Affidavits and Hearsay at 108 Hearing

NCDOT v. Cromartie, __ N.C. App. ___, 716 S.E.2d 361 (Aug. 2, 2011)

In this case, the North Carolina Department of Transportation condemned part of a 9.47 acre tract, splitting it into two remaining parcels. One of the remaining parcels was only .832 acre.  In response, the property owners counterclaimed that the DOT had inversely condemned the .832 acre parcel because the DOT’s lawsuit had deprived the owners of all beneficial enjoyment of that parcel. The DOT filed a motion to dismiss the inverse counterclaim and based its motion, in part, on the threshold requirement of the inverse statute, N.C. Gen. Stat. § 136-111.  That statute only permits an owner to file an inverse condemnation claim where “no complaint and declaration of taking has been filed by [the condemnor]”), and in this case, the DOT had already filed its complaint and declaration of taking. The Trial Court denied the DOT’s motion and held a 108 hearing, at which it determined that the DOT had inversely condemned the .832 acre parcel, finding that it was “not marketable due to extremely small size, irregular shape, restricted access, and design complications.”

The North Carolina Court of Appeals reversed the Trial Court’s determination that the DOT had inversely condemned the .832 acre tract, because the Trial Court based its determination on the combination of one owner’s testimony at the hearing as well as three affidavits from witnesses who were not present.

The Court of Appeals, however, affirmed the Trial Court’s denial of the DOT’s motion to dismiss the owner’s claim of inverse condemnation.  Effectively, the Court of Appeals held that an inverse condemnation claim will lie in a partial takings case when a condemnor leaves a remnant that is not marketable, i.e., an uneconomic remnant.

Links to this case

Experts May Not Testify Solely Based on Their Experience

City of Charlotte v. Combs, ___ N.C. App. ___, 719 S.E.2d 59 (Oct. 4, 2011)

In this case, the City of Charlotte acquired only 333 SF of Temporary Construction Easement (“TCE”), but it cut off access for some disputed period of time to the Biberstein House, an historic property in Charlotte. On voir dire, the City’s appraiser testified about the valuation of the TCE based solely on his experience. The Trial Court then allowed him to testify as to valuation to the jury. Relying on Howerton v. Arai Helmet, Ltd., 358 N.C. 440, 458, 597 S.E.2d 674, 686 (2004) and  NCDOT v. Haywood County, 360 N.C. 349, 626 S.E.2d 645 (2006), the North Carolina Court of Appeals ordered a new trial.  As the Court of Appeals explained,

“when asked on voir dire about the “methodology” he used in formulating his valuation, Mr. Stout -15- responded that it was his ‘understanding,’ based on his 34 years of experience as an appraiser, that ‘there’s no reason to go through th[e] exercise’ of appraising the entire property before and after a TCE because the ‘before’ and ‘after’ values remain ‘constant’; that the use of the TCE does not ‘adversely affect’ the remainder of the property. As for the Combs’ property, although Mr. Stout acknowledged that certain ‘improvements’ had been damaged, specifically two shrubs and a 20-square-foot slab of stamped concrete that had been removed during the construction project, his valuation did not include any assessment of whether the remainder of the Combs’ property was affected in any other respect by the temporary taking.”

* * *

“Here, as in Haywood County, because Mr. Stout based his valuation of the TCE on his experience that such temporary takings do not affect the remainder of the condemnee’s property,-17- rather than an actual assessment that the Combs’ property outside of the TCE was not affected, his method of proof lacked sufficient reliability. 4 The trial court, consequently, abused its discretion in failing to exclude Mr. Stout’s expert testimony regarding his valuation of the TCE. In light of the erroneously admitted expert testimony, the Combs are entitled to a new trial to determine just compensation. See M.M. Fowler, 361 N.C. at 15, 637 S.E.2d at 895 (remanding for new trial where trial court erroneously admitted evidence of lost business profits in condemnation case).”

Links to this case

Odds and Ends

Kirkpatrick v. Town of Nags Head, ___ N.C. ___, 713 S.E.2d 151 (Jul. 5, 2011)

After Surfside Drive in Nags Head was washed away, the Town of Nags Head eventually gave up on trying to rebuild the road and barricaded it to prevent vehicles from driving on the washed out portion of it, cutting off vehicular traffic to Plaintiffs’ beach house.  Later, the Town declared their beach house “unsuitable for occupancy and that they could not reoccupy it until vehicular access had been restored.” Eventually, the beach house was also washed away into the Atlantic Ocean. Plaintiffs sued the Town

  1. for negligent failure to keep Surfside Drive “in proper repair” and “fee from unnecessary obstructions” pursuant to N.C. Gen. Stat. §160A-269(a); and
  2. for inverse condemnation.

Both parties moved for summary judgment. The Trial Court denied the Plaintiffs’ motion and granted the Town’s motion on the inverse claim but denied the Town’s motion on the negligence claim.  The Trial Court found there was a genuine issue of material fact as to whether the Town had waived its sovereign immunity from the negligence claim by purchasing insurance that provided liability coverage for Plaintiffs’ claim.

The North Carolina Court of Appeals reversed.  The Court of Appeals

“conclude[d] that the extent to which particular municipal streets and roads are kept open for use by members of the public, such as Plaintiffs, is a governmental function and that governmental immunity is available to municipalities as a defense to damage claims arising from such discretionary road closure decisions.”

Although the Town had purchased an insurance policy, the Court of Appeals went on to construe that policy to not provide coverage for any potential negligence of the Town in this case.  Therefore, the Town had not waived its sovereign immunity as to Plaintiffs’ negligence claim, and the Town was entitled to summary judgment on that claim.

Links to this case

Seidner v. Town of Oak Island, ___ N.C. App. ___, 719 S.E.2d 254 (Nov. 15, 2011) (unpublished)

In this case, the Town of Oak Island tried to turn the end of a public street into a 5-spot parking lot with an observation deck. The street dead-ended into the Intracoastal Waterway and was adjacent to a lot that the plaintiffs had purchased under a subdivision plat that had dedicated the street area to the Town for public street purposes. The plat, of course, also conveyed an easement appurtenant for street purposes to the lot owners.

The North Carolina Court of Appeals upheld the Trial Court’s summary judgment granting the property owners injunctive relief and declaratory relief,

“permanently enjoining the Town ‘from taking any action to thwart, mitigate, preclude, prohibit, diminish, reduce, violate, or otherwise restrict or reduce [] Plaintiffs’ appurtenant easement rights in and . . . arising under their Deed and Plat Map.'”

Quoting a previous North Carolina Court of Appeals case, the Court reiterated that

“‘[i]f property is dedicated for a particular purpose, it cannot be diverted from that purpose by the state or municipality, except under the power of eminent domain. This principle means that [w]here the owner of land has dedicated [the land] for a street or alley, the municipality cannot appropriate it to other uses or purposes.'”

Links to this case

Reinhart v. City of Brevard, ___ F.Supp.2d ___, 2011 WL 5925531, 2011 U.S. Dist. LEXIS 136330 (W.D.N.C. Nov. 28, 2011)

The Plaintiff property owners filed North Carolina state law claims for trespass and inverse condemnation against the City of Brevard.  The Plaintiffs also included claims for violations of the Fifth and Fourteenth Amendments to the United States Constitution.  Based on federal question jurisdiction, the City removed the case to the United States District Court for the Western District of North Carolina. Thereafter, the Plaintiffs successfully moved the Magistrate Judge to permit them to amend their complaint to eliminate their federal claims and add another state law claim for nuisance. Once the Plaintiffs filed their amended complaint, they moved to remand the case to North Carolina state court pursuant to 28 U.S.C. § 1367(c). The City then objected, arguing that the Plaintiffs were simply forum shopping. United States District Judge Martin Reidinger analyzed the law on continued supplemental jurisdiction over state law claims after a plaintiff dismisses his or her federal claims. The Court then exercised its discretion to

“decline to exercise supplemental jurisdiction over these state law claims and remand the action to state court”,

and remanded this case to state court.

Links to this case

____________________

Christopher J. Simmons, Attorney at LawChristopher J. Simmons is an attorney licensed in North Carolina and Florida and practicing as an associate city attorney with the City of Raleigh, North Carolina.


Tags

2011 NC eminent domain case update, 2011 nc land condemnation case update


You may also like

2011 Update – Easements & Access in North Carolina Law

Cartways and Eminent Domain in North Carolina

{"email":"Email address invalid","url":"Website address invalid","required":"Required field missing"}

Subscribe to our newsletter now!

>