Comm'rs of Pub. Works of Laurens v. City of Fountain Inn
| Decision Date | 16 May 2018 |
| Docket Number | Opinion No. 5559,Appellate Case No. 2015-001894 |
| Citation | 815 S.E.2d 21 |
| Parties | COMMISSIONERS OF PUBLIC WORKS OF THE CITY OF LAURENS, South Carolina, also known as the Laurens Commission of Public Works, Respondent, v. CITY OF FOUNTAIN INN, South Carolina, Appellant. |
| Court | South Carolina Court of Appeals |
David W. Holmes, of Holmes Law Firm, and Boyd Benjamin Nicholson, Jr. and Sarah Patrick Spruill, both of Haynsworth Sinkler Boyd, PA, all of Greenville, for Appellant.
Robert L. Widener, of McNair Law Firm, PA, of Columbia, and Bernie W. Ellis, of McNair Law Firm, PA, of Greenville, both for Respondent.
In this appeal from a declaratory judgment action, the City of Fountain Inn (Fountain Inn) appeals the circuit court's determination Fountain Inn may not provide natural gas service in a particular area without the consent of the Commissioners of Public Works of the City of Laurens, South Carolina, also known as Laurens Commission of Public Works, (LCPW) because that area was within LCPW's "designated service area." We affirm.
LCPW is the entity established by the City of Laurens to provide combined utility services, including natural gas, to residential, commercial, and industrial customers. Fountain
Inn also provides natural gas services. Both parties sell natural gas to customers inside their respective corporate limits as well as to customers outside those limits as allowed by section 5-7-60 of the South Carolina Code (2004).1
During October 1992, officials from both municipalities met to discuss establishing a boundary line in an unincorporated area between the two cities to prevent multiple gas lines in an area. On November 11, 1992, LCPW General Manager Coleman Smoak Jr. sent a letter to Fountain Inn's natural gas System Manager, Carey Elliott, and enclosed a map (the Map) detailing the proposed territorial boundary between the two gas systems. Elliott replied on November 17, 1992, expressing agreement regarding the accuracy of the Map, stating the Map was "in agreement with the Fountain Inn City Council." On November 25, 1992, Smoak responded, indicating a resolution was being prepared for adoption by both municipalities' governing bodies.
However, the boundary line included in the Map was not formally ratified by either the Fountain Inn City Council or by LCPW. For the most part, both parties observed the boundary line for almost two decades, although one of the parties occasionally exceeded the boundary line with the permission of the other party. Nevertheless, some disagreements occurred in which Fountain Inn accused LCPW of serving customers in its territory.2
In 2011, LCPW was contacted about providing natural gas service to an industrial customer, ZF Transmissions, the first company to build in a newly constructed area named Owings Industrial Park. Owings Industrial Park is located entirely within LCPW's portion of the boundary line on the Map. The economic development director for Laurens County Development Corporation later informed LCPW that Fountain Inn had also submitted a proposal on the same project. LCPW,
Fountain Inn, and Clinton Newberry Natural Gas Authority3 met to discuss the territory issue but were unable to reach a resolution of the matter.4 Ultimately, ZF Transmissions accepted LCPW's bid, and they signed a contract.
On March 30, 2011, LCPW filed a complaint seeking a declaratory judgment that Fountain Inn could not provide natural gas in LCPW's service area pursuant to section 5-7-60.5 It also sought an injunction to prohibit Fountain Inn from providing natural gas services in LCPW's service area. On November 14, 2011, the circuit court denied the injunction, finding it did not appear LCPW would suffer any damage prior to trial because LCPW did not allege "there were any other substantial customers in the disputed area who would require natural gas service in the near future."6 Subsequently, both parties filed motions for summary judgment. The circuit court denied both motions and found genuine issues of material fact needed to be decided at trial.
The circuit court conducted a bench trial on March 20, 2014. On cross-examination, Thomas Pitman, the gas manager for Fountain Inn, testified Fountain Inn had to run a new line to provide gas service in Owings Industrial Park because it did not previously have a line there. On redirect, Pitman indicated LCPW also had to build a line to connect to ZF Transmissions' facility. In rebuttal, Dale Satterfield, the former general manager of LCPW, indicated an existing line was already in place when LCPW procured a contract with ZF. He stated LCPW only had to tap into its existing line like it does with any new customer. He also testified that unlike LCPW, Fountain Inn had to run a main line to service the Owings
Industrial Park because it did not have one in place at the time.
On September 26, 2014, the circuit court issued an order finding pursuant to section 5-7-60, LCPW had established a designated service area on the southeastern side of the boundary line shown on the Map and thus Fountain Inn may not provide natural gas service in that area without LCPW's permission. The court reasoned the undisputed testimony demonstrated LCPW had "furnished natural gas service in [the contested] area for over two decades" and also had "the infrastructure to provide that service on an ongoing basis." The court also noted LCPW passed a resolution certifying LCPW provides natural gas service to the contested area and it budgeted to do so in accordance with section 5-7-60. Fountain Inn filed a motion to amend, which the circuit court denied. This appeal followed.
The parties disagree on the proper standard of review for this case. "Declaratory judgment actions are neither legal nor equitable and[ ] therefore, the standard of review depends on the nature of the underlying issues." Judy v. Martin , 381 S.C. 455, 458, 674 S.E.2d 151, 153 (2009). "To determine whether an action is legal or equitable, this [c]ourt must look to the action's main purpose as reflected by the nature of the pleadings, evidence, and character of the relief sought." Lollis v. Dutton , 421 S.C. 467, 478, 807 S.E.2d 723, 728 (Ct. App. 2017) (quoting Fesmire v. Digh , 385 S.C. 296, 303, 683 S.E.2d 803, 807 (Ct. App. 2009) ). "The character of the action is generally ascertained from the body of the complaint, but when necessary, resort may also be had to the prayer for relief and any other facts and circumstances which throw light upon the main purpose of the action." Sloan v. Greenville Cty. , 380 S.C. 528, 534, 670 S.E.2d 663, 666-67 (Ct. App. 2009). "If the character of the action appears with sufficient clearness in the body of the complaint, it must control, unaffected by the prayer for relief or the intention or characterization of the pleader." Bramlett v. Young , 229 S.C. 519, 531, 93 S.E.2d 873, 879 (1956) (quoting Speizman v. Guill , 202 S.C. 498, 514-15, 25 S.E.2d 731, 739 (1943) ). "While the prayer constitutes no part of the plaintiff's cause of action, ‘it is an element that may properly be considered in determining the legal or equitable character of an action, and[ ] whe[n] the complaint states facts which would support either a legal or an equitable action, the relief demanded will ordinarily determine its character.’ " Id. (citation omitted) (quoting 1 C.J.S. Actions § 54 at 1155).
Fountain Inn asserts the proper standard of review to apply is that for the review of a request for an injunction. "The power of the court to grant an injunction is in equity."
Strategic Res. Co. v. BCS Life Ins. Co. , 367 S.C. 540, 544, 627 S.E.2d 687, 689 (2006). An injunction is a drastic and "extraordinary equitable remedy courts may use in their discretion in order to prevent irreparable harm to a party" when no adequate remedy exists at law. Hampton v. Haley , 403 S.C. 395, 409, 743 S.E.2d 258, 265 (2013). "In an action at equity, tried by a judge alone, an appellate court may find facts in accordance with its own view of the preponderance of the evidence." Inlet Harbour v. S.C. Dep't of Parks, Recreation & Tourism , 377 S.C. 86, 91, 659 S.E.2d 151, 154 (2008). "However, we are not required to disregard the findings of the trial judge who saw and heard the witnesses and was in a better position to judge their credibility." Straight v. Goss , 383 S.C. 180, 192, 678 S.E.2d 443, 449 (Ct. App. 2009). "Moreover, the appellant is not relieved of his burden of convincing the appellate court the trial judge committed error in his findings." Pinckney v. Warren , 344 S.C. 382, 387-88, 544 S.E.2d 620, 623 (2001).
However, LCPW contends the standard of review is that interpreting a statute and thus is at law. "Statutory interpretation is a question of law ...." Barton v. S.C. Dep't of Prob. Parole & Pardon Servs ., 404 S.C. 395, 414, 745 S.E.2d 110, 120 (2013). Additionally, "[t]he determination of legislative intent is a matter of law." Wehle v. S.C. Ret. Sys. , 363 S.C. 394, 402, 611 S.E.2d 240, 244 (2005). "This [c]ourt reviews all questions of law de novo." Lollis , 421 S.C. at 477, 807 S.E.2d at 728 (quoting Fesmire , 385 S.C. at 302, 683 S.E.2d at 807 ). "In an action at law tried without a jury, an appellate court's scope of review extends merely to the correction of errors of law." Temple v. Tec-Fab, Inc ., 381 S.C. 597, 599-600, 675 S.E.2d 414, 415 (2009). "The [c]ourt will not disturb the trial court's findings unless they are found to be without evidence that reasonably supports those findings." Id. at 600, 675 S.E.2d at 415.
Because the resolution of this matter turns on the interpretation of section 5-7-60, the appropriate standard of review for this case is that for the interpretation of a statute, which is an action at law.
Fountain Inn maintains the circuit court erred by finding LCPW could exclude Fountain Inn from providing natural gas service to customers...
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Commissioners of Pub. Works of Laurens v. City of Fountain Inn
...natural gas service to the industrial park, and the court of appeals affirmed. Comm'rs of Pub. Works of the City of Laurens v. City of Fountain Inn , 423 S.C. 461, 815 S.E.2d 21 (Ct. App. 2018). Because there is no reasonable interpretation of section 5-7-60 that would permit LCPW to claim ......