Summary
finding that when DelDOT moved for condemnation two months after its initial offer because the property owners did not submit a counteroffer, DelDOT failed to negotiate in good faith because the property owners specifically explained to DelDOT that they could not respond to DelDOT's offer until the underlying access and relocation issues were resolved and they would need to obtain an appraisal, DelDOT continued to negotiate concerning the nonprice issues during those two months, and DelDOT moved for condemnation “without requesting a counter offer ... and without explaining that the [access and relocation proposals] were off the table (which would have [caused] the [property owners] to get an appraisal)”
Summary of this case from Lawson v. StateOpinion
C.A. No. 06C-10-014 WLW.
Submitted: January 19, 2007.
Decided: April 26, 2007.
Upon the State's Rule to Show Cause for Order of Possession.
Dismissed Without Prejudice.
Mark F. Dunkle, Esquire of Parkowski Guerke Swayze, Dover, Delaware; attorneys for the Plaintiff.
Richard L. Abbott, Esquire of Abbott Law Firm, Hockessin, Delaware; attorneys for the Defendants.
ORDER
The Delaware Department of Transportation ("DelDOT") brought an action to acquire land under the power of eminent domain. Generally, the interests to be acquired by the Plaintiff are fee simple title as to 8,311.34 square feet (0.19 acres of land), more or less, and the imposition of a denial of vehicular access along the property line fronting U.S. Route 13 Southbound and Lochmeath Way. Defendants oppose the taking and attempt to show good cause why the Order of Possession should not be entered.
Procedural History and Parties' Contentions
The State of Delaware, by the Secretary of the Department of Transportation, ("the State") filed a Complaint seeking an Order of Possession under the power of eminent domain. The Land Owner Defendants filed an "Opposition to Request for Order of Possession." Defendant Amin, individually, then filed a "Response in Opposition to Request for Order of Possession and Motion to Dismiss." Defendants' second Motion supplemented the Defendants' Original Motion and also added the Motion to Dismiss. The Parties filed further submissions in accordance with the Court's letter Order dated December 12, 2006. The Court held a hearing on the issue of good cause concerning the Order of Possession, under Superior Court Civil Rule 71.1, on January 19, 2007.
Defendants in this action are Mehul N. Amin, Trupti N. Desai, Artisans' Bank, 8,311.34 Square Feet (0.19 acres of land), more or less as permanent taking, and Denial of Vehicular Access to U.S. Route 13 Southbound and Lockmeath Way, Situate in North Murderkill Hundred, Kent Count y, State of Delaware and Unknown Owners. Defendants Amin and Desai filed the "Opposition to Request for Order of Possession."
Only Defendant Amin filed this Motion due to an alleged service of process issue concerning Defendant Desai t hat exi sted wh en the Motion w as filed. D efen dant De sai has been served by a special process server in this action. The Court will treat the Motions and submissions as if submitted by both Defendants.
Further, the Court will treat the Defendants' Responses and Motion to Dismiss as objections or defenses to the taking made by way of answer, pursuant to 10 Del. C. § 6107. Title 10 Del. C. § 6107 states in pertinent part: "Any objection or defense to the taking of the property. . . by any defendant, shall be made by answer. . . All objections and defenses not so presented shall be deemed waived. . ."
Defendants argued for and wish to have a full blown evidentiary hearing concerning certain objections or defenses raised. The Court held a hearing on good cause pursuant to Rule 71.1 and will determine whether to enter the Order of Possession forthwith based on the previously held hearing and submissions of Parties. A full blown evidentiary hearing is not needed.
The State argues that the taking of Defendants' property is necessary for a public purpose and the affidavits submitted by the State evidence the necessity and public purpose of the taking. Consequently, the State contends that the taking is proper and the Order of Possession should be granted.
Defendants raise several objections or defenses to the taking of their property. First, Defendants claim that the proposed taking is for a private purpose and DelDOT is exercising various forms of bad faith, fraud and abuse of discretion in proposing the taking in issue. Next, Defendants argue that there is no public necessity to justify the magnitude of the proposed taking. Finally, Defendants contend that the State failed to comply with the Real Property Acquisition Act ("RPAA") due to inadequate settlement negotiations.
Defendants have submitted two affidavits in support of their opposition to the Order of Possession. The affidavits are from Defendant Amin and Defense Counsel Richard L. Abbott. The Court has taken arguments raised in the affidavits into account in this decision.
Specifically, 29 Del. C. § 9505.
Defendants also make an argument concerning lack of advance notice of the Order of Possession hearing. Defendants had notice of the State's intent to present an Order of Possession at least 10 days prior to the Court's January 19, 2006 hearing on good cause, which laid out all of the issues now presently before the Court. The argument is therefore moot.
Discussion
The General Assembly granted the Delaware Department of Transportation ("DelDOT") the authority to condemn private land for public use, providing that DelDOT may "acquire by condemnation or otherwise any land, easement, franchise, material or property, which, in the judgment of the Department, shall be necessary therefor. . ." Superior Court Civil Rule 71.1 governs condemnation proceedings. Rule 71.1 provides in pertinent part:
"In a condemnation proceeding instituted by a public agency. . . an order of possession of the property to be taken shall be entered forthwith, pursuant to 10 Del. C. § 6110(a), upon 10 days' written notice of intent to present such order, to be given to the property owner or his attorney of record, supported by an affidavit of necessity executed by the chief administrative officer of the condemning agency, unless the property owner by affidavits, depositions, and/or verified answer shall show good cause why such order of possession should not be entered forthwith. Any hearing on the issue of good cause shall be held without delay and on such affidavits, depositions, and/or verified answer. Disposition of the issue of good cause shall be made by the Court without delay. . .
In all such condemnation proceedings the burden shall be upon the property owner to overcome the presumption of regularity and the prima facie case of necessity for a public use presented by the institution of such proceeding. . ."
Defendants contend that DelDOT's proposed taking is for an improper private purpose. Defendants concede that the installation of the traffic signal at the U.S. 13 and Lochmeath Way intersection serves a public purpose, but Defendants argue that other components of the project have been undertaken for the purposes of benefitting private real estate developers. Specifically, Defendants claim that the developers' engineers drew up the project without giving any attention to the impact on private property owners and their access, which pre-existed and pre-dated the Camden Station shopping center development.
Defendants argue that former Secretary of Transportation, Nathan Hayward, "cut a backroom deal. . . in order to advance [the] pecuniary interests [of politically influential developers]." For example, the denial of access to Defendant Amin's liquor store will likely lead to the store's closing, which would allow the developers to establish their own liquor store in the Camden shopping center.
DelDOT may condemn property under eminent domain for the statutory purposes required by 17 Del. C. § 132. Agencies of the State may condemn private property provided that the primary purpose of the condemnation is to benefit the public. DelDOT has been charged by the General Assembly with doing whatever is necessary to ensure that the citizens of this State have suitable highways upon which to travel. The Court's inquiry must focus primarily on whether the statutorily defined interests are the chief beneficiaries of the project. The Court may also consider evidence indicating whether the condemning authority was motivated by concerns not within its statutory mandate.
DelDOT is charged with maintaining all state highways under its jurisdiction. 17 Del. C. § 132(b)(2).
Wilmington Parking Auth. v. Land With Improvements, 521 A.2d 227, 231 (Del. 1986).
Cannon, 807 A.2d at 562.
Wilmington Parking Auth., 521 A.2d at 233.
Id.
DelDOT is charged with maintaining suitable highways for state travelers. Drew A. Boyce, professional engineer for DelDOT, submitted an affidavit analyzing the background of and impact to Defendants' property with relation to the proposed taking. Mr. Boyce's affidavit explains the following: A signal study was conducted by DelDOT concerning the intersection at U.S. 13 and Lochmeath Way and it was determined that a traffic signal was needed at the intersection. The study showed that 27 crashes occurred at the subject intersection during a 4.5 year time period, including 1 fatal accident. The subsequent design of the service road and intersection improvements was based on the addition of the traffic signal. The State then analyzed (and reconfigured) the existing lane configuration so that the signal could operate at an acceptable level. It is apparent to the Court that travelers on the State's public highway are the chief beneficiaries of the proposed condemnation project in this case.
Defendants argue that DelDOT was motived by concerns not within their statutory mandate, because the State's primary [underlying] motivation was to benefit private developers. The Court is satisfied that the improvements required, which facilitate the need to condemn the subject property, are motivated by DelDOT's determination that a traffic signal was needed at the intersection of U.S. 13 and Lochmeath Way. Mr. Boyce's affidavit evidences the State's motivation. The affidavit explains the following: The State hired Karins and Associates, an engineering firm, to perform the analysis discussed above, and the firm determined that the approach leg on eastbound Lochmeath Way would need a separate right turn lane, through lane, left turn lane and a single westbound lane, which would necessitate the need to establish a new right-of-way. Based on the geometry of the intersection, it was determined that the roadway widening would be done on the north side of the intersection. A median island needed to be added in the leg of the intersection to control vehicle movement perpendicular to the queued traffic. As a result of these considerations, the new-right-of way was therefore proposed.
After establishing the need for the new right-of-way, the State determined that the taking needed to include the denial of access to Defendants' property. Access was denied based on DelDOT standards. In addition, access was denied for safety reasons (discussed below). Mr. Boyce's sworn affidavit articulates the process DelDOT utilized in determining the need for the condemnation. DelDOT's process was thoughtful and thorough. It is apparent to the Court that the State's underlying motivation for the taking was for the benefit of the public and derived from the need to install a traffic signal at the intersection of U.S. 13 and Lochmeath Way.
Defendants next argue that the magnitude of the proposed taking is not necessary for a legitimate public purpose. Defendants specifically claim that the widening of Lochmeath Way, the installation of concrete channelization islands and medians, the interconnection with the private internal shopping center street of WalMart Drive and denial of access to Defendants' property is not necessary for the public purpose of installing a traffic signal at the Lochmeath Way and U.S. 13 intersection.
Title 17 Del. C. § 132(c)(4)makes clear that DelDOT is empowered to make the determination of necessity in the first instance. DelDOT has been charged by the General Assembly with doing whatever is necessary to ensure that the citizens of this State have suitable highways upon which to travel. Once DelDOT determines a particular property is necessary to the fulfillment of its duty to maintain the State's highways, the courts must accord broad deference to that decision. This Court reviews DelDOT's necessity determination for fraud, bad faith or abuse of discretion.
Cannon, 807 A.2d at 560.
Id. at 562.
Id. at 560.
Id. at 561.
The chief administrative officer of DelDOT, Carolann Wicks, submitted an affidavit stating that the taking in issue was necessary for a public purpose. Thus, there is a presumption of regularity and a prima facie case of necessity for public use that Defendants must overcome. Defendants generally argue that other less intrusive options were available that the State could have chosen to effectively install the traffic signal, but the State choose the present option in order to benefit private developers. However, Mr. Boyce submitted an affidavit explaining the necessity for the taking in detail. Mr. Boyce's affidavit articulates the analytical framework relied on by the State in determining the need for the right of way and why a denial of access to the parcel should be established. Those reasons include the current site constraints, limited roadway frontage and safety issues. Specifically, Mr. Boyce states that it is impossible for a delivery truck to safely access the site in question and it would be impossible to provide the required parking and room for vehicles to travel within the site.
There was also a concern stated about non-delivery vehicles' ability to safely enter the liquor store due to the proposed road changes.
Defendants allege that the magnitude of the proposed taking is improper and a result of bad faith on the part of DelDOT. Specifically, Defendants argue that the magnitude of the taking is a result of former Secretary of Transportation Nathan Hayward's "desire to help out his developer buddies." To allege bad faith a party must charge facts rather than conclusions and such facts must suggest actual malevolence by the official towards the complaining party. Defendants make conclusory allegations concerning DelDOT's alleged effort to take Defendants' property for the bad faith purpose of benefitting private developers. However, the facts do not sufficiently support the allegations. Further, the affidavits of Mr. Boyce and Ms. Wicks directly contradict Defendants' allegations. Mr. Boyce's affidavit evidences that DelDOT's proposal was thoughtful and nonarbitrary concerning the necessity of the taking. Defendants have not shown that DelDOT's necessity determination was a product of bad faith, fraud or abuse of discretion. Consequently, Defendants have not overcome the presumption of regularity and the prima facie case of necessity for public use.
United States of America v. 49.79 Acres of Land, et. al., 582 F. Supp. 368, 374 (D. Del. 1983).
Merely reciting personal, motivative actions on the part of various State officials does not require or demand further investigation without a factual showing by the Defendants. Blanket allegations that developers have hijacked DelDOT by money-grabbing private developers feeding at the public trough does not further the Defendants' case. See Mr. Abbott's affidavit.
Finally, Defendants object to the Order of Possession on the grounds that DelDOT failed to comply with the policies of the Real Property Acquisition Act ("RPAA") as set forth in 29 Del. C. § 9505. The RPAA is applicable to the acquisition of real property by state and local land acquisition programs or projects in which federal, state, or local funds are used. Section 9505 of the RPAA prescribes policies that an agency shall follow in acquiring real property. The RPAA guidelines are directory rather than mandatory. Therefore, noncompliance may in certain circumstances be excused.
City of Dover v. Cartanza, 541 A.2d 580, 581 (Del.Super. 1988).
Id.
Id. at 583.
Id.
Noncompliance is not a jurisdictional defect requiring automatic dismissal whenever it is raised. The initial burden of establishing noncompliance rests on the defendant. If noncompliance exists, then the agency must demonstrate a valid excuse for its failure to follow the RPAA's policies. Excuses include the agency's good faith efforts to comply with the policies or a showing that compliance would have been futile.
Id. ("[Noncompliance] is instead a defense or objection to the taking. . .").
State of Delaware v. Dorzbzck, 1991 WL 89887, *2 (Del.Super. 1991).
Cartanza, 541 A.2d at 583.
Id.
Defendants specifically argue that the State did not comply with the RPAA §§ 9505(1), 9505(7) and 9505(15) in the present action. Title 29 Del. C. § 9505(1) states "every reasonable effort shall be made to acquire expeditiously real property by negotiation." The State submitted an affidavit from V. Wayne Rizzo, Assistant Director, Planning for Real Estate Services for DelDOT, explaining the negotiations that took place.
Based on the Court's decision concerning 29 Del. C. § 9505(1), Defendants' claims concerning §§ 9505(7) and 9505(15) will not be addressed.
The negotiations proceeded as follows: Defendants were made aware of an appraisal being assigned concerning the subject property in March 2004. The appraisals were internally approved in July 2004, but offers were not extended at that time. After the Developer purchased two residential properties adjoining the Defendants' property, the State waited until after new plans were developed to proceed with the offers. In March 2005, contact was made with the Defendants to make a total acquisition offer due to the denial of access. Defendants' Counsel attempted to negotiate an alternative access as opposed to a complete denial of access to Defendants' property. A final appraisal was completed in April 2006, after the final (new) plans were completed, and DelDOT was authorized to negotiate in June, 2006. A written offer was made on June 29, 2006, and the Appraisal was supplied to the Defendants.
Defense Counsel explained to DelDOT that his client wanted to exhaust all settlement options with respect to the property swap, alternative access or liquor store parking lot reconfiguration settlement concept before expending thousands of dollars to obtain an appraisal in order to make a counter offer. The State put Defendants' property into condemnation on August 31, 2006, because the Defendants never proffered a counter offer to DelDOT's June 29, 2006 offer, which made "further negotiations futile."
The Parties were still continuing to communicate about the other settlement options (discussed above), including possible replacement sites, at that time.
The Court finds that the State did not comply with the RPAA § 9505(1). Further, the State failed to proffer a valid excuse for its failure to comply with the act. The State is required to make every reasonable effort to acquire real property by negotiation under the RPAA. DelDOT made a written offer for Defendants' property on June 29, 2006. On August 31, 2006, DelDOT moved to condemn the property because Defendants had not made a counter offer at that time. Defendants were still in ongoing negotiations with the State between June 29 and August 31, 2006 concerning alternate access options and possible replacement sites. Defendants' actions evidenced their belief that the value of the property was higher than what the State had offered.
This point also cuts across the State's futility argument discussed below.
Defendants specifically explained to the State that it would be hard to respond to the June 29th offer until the underlying negotiations [concerning non-price related issues] were concluded. Further, Defendants articulated that they would have "some numbers" (monetary value) that would allow them to negotiate with the State if it was determined that a relocation was possible. If a relocation was not possible, Defendants explained to the State that they would need to get an appraisal. The State argues that Defendants only discussed the request to obtain access over the Developer's property, but did not otherwise respond to the offer (as to price). However, there is no evidence that DelDOT ever requested that the Defendant make a counter offer, nor did DelDOT explain that the alternative negotiation requests (for access, etc.) were off the table. Defense Counsel was not even made aware that a condemnation action had been filed until November 2006.
Defense Counsel states that no discussions with respect to the monetary amounts were requested by DelDOT.
Defense Counsel was under the impression that settlement negotiations were still ongoing when he became aware of the condemnation proceeding.
The State made an offer and continued to negotiate with Defendants concerning non-price related issues. The State placed the property into condemnation without requesting a counter offer from the Defendants and without explaining that the alternative options were off the table (which would have triggered the Defendants to get an appraisal). Therefore, the State did not make every reasonable effort to acquire the Defendants' property by negotiation. DelDOT's excuse that further negotiations would have been futile is unpersuasive. Defendants were willing to negotiate concerning alternate access, etc., and the State did not even ask the Defendant to make a counter offer before filing the condemnation action. Consequently, the State could not have reasonably known whether further negotiations with Defendants concerning the purchase price would have been futile.
See State of Delaware v. Brandywine Sec., Inc., 1994 WL 792725 (Del.Super.). The State cited this case in oral argument, because the Court held that 29 Del. C. § 9505(1) had been met. However, in that case "communications occurred between [the Parties] regarding purchase price," and counter offers were made by the property owners (even though the Court found the counter offers unreasonable).
In conclusion, the Court finds that the proposed taking is necessary for a public purpose. However, the State failed to comply with the Real Properties Acquisition Act. Given the purposes of the RPAA, the appropriate remedy to ensure compliance with its guidelines is dismissal without prejudice. Should good faith efforts to comply with the RPAA not result in an agreement between the parties, the State may commence another condemnation action.
Cartanza, 541 A.2d at 584.
Id.
Based on the foregoing, the condemnation action is dismissed without prejudice. IT IS SO ORDERED.