Dale Properties, LLC v. State

• Decision Date: 07 February 2002
• Docket Number: No. C3-00-837.,C3-00-837.
• Parties: DALE PROPERTIES, LLC, Respondent, v. STATE of Minnesota, Petitioner, Appellant.
• Court: Minnesota Supreme Court

638 N.W.2d 763

DALE PROPERTIES, LLC, Respondent, v. STATE of Minnesota, Petitioner, Appellant.

No. C3-00-837.

Supreme Court of Minnesota.

February 7, 2002.

Mike Hatch, Attorney General, David Michael Jann, Assistant Attorney General, St. Paul, Attorneys for Appellants.

John W. Lang, Thomas P. Klecker, Messerli & Kramer, P.A., Minneapolis, Attorneys for Respondent.

Heard, considered, and decided by the court en banc.

OPINION

PAGE, Justice.

This case presents the issue of whether a landowner whose immediate access to a state highway has been limited to one direction by the closure of a median crossover is entitled to compensation from the state for the resulting reduction in value of its property. The court of appeals reversed summary judgment for the state and remanded for a determination whether the remaining access was "reasonably convenient and suitable." We reverse, concluding that a property owner who retains direct access to traffic in one direction, although losing it in the other direction due to the closure of a median crossover, retains reasonable access as a matter of law.

Dale Properties, LLC (Dale), owns roughly 29 acres of undeveloped land, which it uses for farming, in Oakdale, Minnesota. The property, located in the southeast quadrant of the intersection of Interstate 694 and Trunk Highway 5, is bounded by I-694 on the west, Highway 5 on the north, a railroad right-of-way on the south, and another owner's undeveloped property on the east. Dale's access to the property is limited to a 30-foot point of access at the northeast corner of the property. In September 1997, the Minnesota Department of Transportation closed an opening in the median along Highway 5 directly across from Dale's access point. Due to the closing, the westbound lanes of Highway 5 are no longer available for direct ingress to or egress from the property.

After the median crossover was closed in 1997, Dale was left with direct access to only the eastbound lane of Highway 5. Consequently, those wishing to enter the property from the westbound lane have had to travel an additional five-eighths of a mile and make a U-turn onto the eastbound lane to reach the property's access point. Those exiting the Dale property wishing to travel west have had to travel an additional mile as well as make a U-turn. According to Dale, commercial trucks are unable to make U-turns at the intersections closest to the property.

Due to the closure, Dale alleged difficulty in the development of the property, which is zoned industrial office in the northern portion, general industrial in the southern portion, and guided commercial generally. Dale claimed that, before the closing, the highest and best use of the property was threefold: a convenience store with gas pumps, a hotel with a restaurant, and office buildings and warehouse space. Dale claimed that, after the closing, the highest and best use was residential development. Dale asserted that the closure of the crossover caused the value of the property to drop by approximately $800,000.

Dale petitioned the district court for a writ of mandamus seeking to compel the state to initiate condemnation proceedings or, in the alternative, to pay damages allegedly caused by the closure of the median crossover. Dale contended that the property no longer had reasonably convenient and suitable access to the highway, that the closure substantially impaired its ability to develop the property, that the closure significantly decreased the property's fair market value, and that the closure constitutionally damaged the property, thereby amounting to a taking in violation of both the Minnesota and the United States Constitutions. In response, the state moved for summary judgment, asserting that Dale's property had access in one direction, as required by this court's decision in County of Anoka v. Blaine Building Corp., 566 N.W.2d 331 (Minn.1997), and that no taking occurred.

The district court granted the state's motion for summary judgment, finding that it was unnecessary to consider the reasonableness of Dale's remaining access to the highway because no "compensable taking" had occurred. On appeal, the court of appeals concluded that the district court erred by failing to consider whether Dale's remaining access was "reasonably convenient and suitable." Dale Props., LLC v. State, 619 N.W.2d 567, 571 (Minn.App.2000). As a result, the court of appeals reversed in part and remanded. Id. at 573.

I.

Article I, section 13, of the Minnesota Constitution provides that "[p]rivate property shall not be taken, destroyed or damaged for public use without just compensation therefor, first paid or secured." Minnesota Statutes § 117.025, subd. 2 (2000), defines "[t]aking and all words and phrases of like import" to include "every interference, under the right of eminent domain, with the possession, enjoyment, or value of private property." Thus, a taking may occur both as a result of the physical appropriation of property or as the result of interference with the ownership, possession, enjoyment, or value of property. Johnson v. City of Plymouth, 263 N.W.2d 603, 605 (Minn.1978). In either case, our analysis is the same. Blaine Bldg. Corp., 566 N.W.2d at 336. Property owners who believe the state has taken their property in the constitutional sense may petition the court for a writ of mandamus to compel the state to initiate condemnation proceedings. Gibson v. Commissioner of Highways, 287 Minn. 495, 498, 178 N.W.2d 727, 729-30 (1970); see also Minn.Stat. §§ 586.01-.12 (2000).

II.

The resolution of this case is governed by our decisions in Hendrickson v. State, 267 Minn. 436, 127 N.W.2d 165 (1964), State ex rel. Mondale v. Gannons Inc., 275 Minn. 14, 145 N.W.2d 321 (1966), and, most recently, Blaine Building Corp.,566 N.W.2d at 331.

Hendrickson involved the state's construction of a freeway that denied the abutting property owner direct access to the highway. 267 Minn. at 436-39, 127 N.W.2d at 167-69. The property owner's only access to the highway was indirect and circuitous by way of a frontage road. Id. at 439, 127 N.W.2d at 169. We held that, notwithstanding the availability of a frontage road, an owner suffers compensable damage if the highway to which the owner previously had immediate and unlimited access is rebuilt on an existing right-of-way in a manner that denies the owner reasonably suitable and convenient access to the main thoroughfare in at least one direction. Id. at 445-46, 127 N.W.2d at 172-73. While holding that the state's exercise of its police power, on the facts presented, could result in a compensable loss, we set forth a number of examples of noncompensable exercises of a state's police power. Id. at 440-41, 127 N.W.2d at 169-70. One such example was the construction of "median strips prohibiting or limiting crossovers from one lane of traffic to another." Id. The other examples included the establishment of one-way streets and lanes of traffic; restrictions on U-turns, left and right turns, and parking; and regulations governing the weight, size, and speed of vehicles. Id. The court noted that these restrictions and regulations do not give rise to compensable damages because they "govern all motorists, including abutting property owners once they are on the traveled portion of the thoroughfare." Id.

In Gannons Inc., we held that the trial court erred when it failed to "instruct on the police power of the state to control traffic by median strips or dividers without the payment of compensation." 275 Minn. at 21-22, 145 N.W.2d at 327-28. In doing so, the court noted that the "law is well settled in this state and other states that the dividing of a roadway by median strips or dividers cannot be made the subject of compensation in condemnation." Id. at 23, 145 N.W.2d at 329.

Recently, in Blaine Building Corp., we considered whether the loss of traffic access in one direction, due to the construction of a median, may be included when determining the market value of the remaining land after a partial taking. 566 N.W.2d at 334. In answering that question, we again stated that "`the dividing of a roadway by median strips or dividers cannot be made the subject of compensation in condemnation,' where, as a result, a property owner loses traffic access in one direction, but retains access in the other." Id.

The rationale for concluding that loss of traffic access in one direction is noncompensable when direct traffic access remains in the other direction can be found in our prior cases and the cases upon which we relied in Hendrickson and Gannons Inc. Collectively, the reasons may be stated as follows: First, the construction of highway medians constitutes an exercise of police power in furtherance of the state's duty to ensure public safety on the roadways. Hendrickson, 267 Minn. at 442,127 N.W.2d at 170; State Highway Comm'n v. Burk, 200 Or. 211, 265 P.2d 783, 792 (1954); Pennysavers Oil Co. v. State, 334 S.W.2d 546, 548-49 (Tex.Civ.App.1960). Second, the restrictions on travel that result from the use of highway medians affect all members of the traveling public and are not unique to abutting property owners. Hendrickson, 267 Minn. at 441,127 N.W.2d at 170; Iowa State Highway Comm'n v. Smith, 248 Iowa 869, 82 N.W.2d 755, 762 (Iowa 1957); Holman v. State, 97 Cal.App.2d 237, 217 P.2d 448, 452 (1950). Third, as long as property owners have access to the abutting highway in at least one direction, the use of highway medians that prohibit crossover from one traveled lane to another merely results in circuity of route, as opposed to substantial impairment of the right of access. Gibson, 287 Minn. at 500,178 N.W.2d at 730; People v. Sayig, 101 Cal.App.2d 890, 226 P.2d 702, 711 (1951); Mabe v. State, 83 Idaho 222, 360 P.2d 799, 802 (1961).

Additionally, it is obvious that the dividing of a highway will have a marked effect on traffic patterns and access in any situation. Gannons Inc., 275...