Electro-Jet Tool Mfg. Co., Inc. v. City of Albuquerque

• Citation: 114 N.M. 676,845 P.2d 770,1992 NMSC 60
• Decision Date: 08 September 1992
• Docket Number: No. 19749,ELECTRO-JET,19749
• Court: Supreme Court of New Mexico
• Parties: TOOL AND MANUFACTURING COMPANY, INC., an Ohio corporation, Plaintiff-Appellant, v. The CITY OF ALBUQUERQUE, a municipal corporation, Defendant-Appellee.

Page 770

845 P.2d 770

114 N.M. 676

ELECTRO-JET TOOL AND MANUFACTURING COMPANY, INC., an Ohio

corporation, Plaintiff-Appellant, v. The CITY OF ALBUQUERQUE, a municipal corporation, Defendant-Appellee.

No. 19749.

Supreme Court of New Mexico.

Sept. 8, 1992.

[114 N.M. 677] Oman, Gentry, Yntema & Stotts, Nicholas R. Gentry and Todd W. Rogers, Albuquerque, for plaintiff-appellant.

David S. Campbell, City Atty. and David Suffling, Asst. City Atty., Albuquerque, for defendant-appellee.

OPINION

MONTGOMERY, Justice.

Article II, Section 20, of the New Mexico Constitution provides: "Private property shall not be taken or damaged for public use without just compensation." In this case we consider the meaning of the phrase "for public use" in the context of an inverse condemnation claim for damage to a property owner's buildings caused by a municipality's maintenance of nearby drainage ditches.

I.

The plaintiff is Electro-Jet Tool and Manufacturing Company, Inc. ("Electro-Jet"). It owns one or more buildings and other facilities on the north side of Albuquerque, New Mexico, not far from the Rio Grande River. Two drainage ditches, originally constructed and thereafter maintained by the City of Albuquerque ("the City"), border Electro-Jet's property. One ditch is located on the south side of the property and the other on the west. The purpose of the ditches is to carry away storm and other waste water and otherwise to drain the abutting property. The south side ditch empties into the west side ditch, and water drained through both ditches eventually empties into the river.

In the summer of 1986, the City performed alteration and maintenance work on both ditches. With respect to the west side ditch, it altered the slope of the ditch so that water ponded to a depth of several inches on several occasions, some of which lasted for several days. The west side ditch work also dammed up the south side ditch, so that water ponded in the latter ditch as well. The City also failed to maintain the grade of the south side ditch and to clean it out properly; these failures also caused water to pond in that ditch. The ponding water migrated through the subsurface soil and caused Electro-Jet's buildings to settle and otherwise damaged its property.

Electro-Jet brought suit for this damage against the City and various other defendants in July 1988. Two claims were asserted against the City: a claim for negligence and a claim in inverse condemnation. The City answered, admitting and denying various allegations in the complaint and raising various defenses, including defenses that the complaint failed to state a claim upon which relief could be granted and that the City was immune under the Tort Claims Act from liability for any of the alleged acts of negligence. Extensive discovery followed, and in October 1990 the City moved for summary judgment as to Electro-Jet's inverse condemnation claim. The sole ground for the City's motion was that, under the allegations in the complaint and in light of Electro-Jet's answers to the City's interrogatories, Electro-Jet had not stated a claim in inverse condemnation. The trial court agreed and, by order entered in January 1991, granted summary judgment to the City on Electro-Jet's claim for inverse condemnation, dismissed with prejudice the count in the complaint asserting the claim, and certified the order as a final judgment under SCRA 1986, 1-054(C)(1) (order adjudicating fewer than all claims and determining absence of just reason for delay is final judgment). Electro-Jet thereupon appealed.¹

The trial court's order granting the City summary judgment on Electro-Jet's inverse condemnation claim did not recite the basis for the order, except to say that there was no genuine issue as to any material fact and that the City was entitled to judgment on the claim as a matter of law. From the parties' briefs and arguments, however, we think it probable that the court based its ruling on the propositions that a claim for inverse condemnation and a claim for negligence are mutually exclusive and that Electro-Jet, by predicating its inverse condemnation claim on the same facts as its negligence claim, was barred as a matter of law from seeking inverse condemnation. In its answers to the City's interrogatories, Electro-Jet had stated that the facts underlying its inverse condemnation claim were essentially the same as those constituting the City's allegedly negligent alteration and maintenance. Additionally, in answer to an interrogatory requesting that it describe specifically what alteration or maintenance was performed by the City that resulted in damage to its property, Electro-Jet had said that the same actions as described in another answer describing the allegedly negligent alteration or maintenance also applied to its inverse condemnation claim. And finally, in response to the question, "Do you claim that the design or maintenance or alteration of the south and west ditches were reasonably expected to cause damage or taking of [Electro-Jet's] property if done in a reasonabl[y] prudent manner?," Electro-Jet had answered: "No. If maintenance had been performed in a reasonably prudent and non-negligent manner, the damages sustained by Electro-Jet would not have occurred."

Electro-Jet argues on appeal that the position evidently adopted by the trial court, and which it ascribes also to the City, has no support in New Mexico law. It maintains that the inverse condemnation count of its complaint alleged all of the elements necessary to support a claim in inverse condemnation and that the presence or absence of negligence as part of the facts underlying such a claim is immaterial to a property owner's entitlement to inverse condemnation when those elements are alleged and proven. It further maintains that the only elements of a properly asserted inverse condemnation claim are: (1) a taking or damaging of private property for public use, by (2) an entity authorized to exercise the power of eminent domain, where (3) there has been no compensation paid nor condemnation initiated. (It will be noted that this phrasing of the "elements" of an inverse condemnation claim begs the question considered in this opinion, since it recognizes that the taking or damaging must be "for public use.") Electro-Jet completes its argument by insisting that all three of these elements were alleged in its complaint, and indeed were admitted by the City in moving for summary judgment, and that it was therefore entitled to pursue its claim for inverse condemnation.

In connection with this last part of its argument, Electro-Jet has affirmed, several times in its briefs and again at oral argument, that there are no factual issues related to its entitlement to inverse condemnation; the question posed by the trial court's order is one of law. That question is whether Electro-Jet's complaint, considered in the light of its answers to the City's interrogatories, stated a claim upon which relief through inverse condemnation could be granted.

As the trial court's order comes to us for review, therefore, it stands essentially in the same posture as an order granting a motion to dismiss for failure to state a claim under SCRA 1986, 1-012(B)(6). Under the latter part of that rule, when a defendant's motion to dismiss relies on matters outside the complaint itself, it is to be treated as a motion for summary judgment. The City's motion relied on Electro-Jet's answers to its interrogatories, and the trial court in granting summary judgment and dismissing Electro-Jet's inverse condemnation claim presumably considered those answers. That does not change the fact that the City's motion essentially sought, and the court's order granted, dismissal of the count for failure to state a claim upon which relief could be granted.

In deciding this appeal, we agree with Electro-Jet's assertion that negligence is irrelevant to a viable claim for inverse condemnation, but we disagree with its position that the only allegation required to state an inverse condemnation claim is that damage to private property has resulted from a public entity's performance of a public purpose. Electro-Jet's emphasis is on the transitory act or omission of government in pursuit of a public purpose, not on the damage to property for public use. The Constitution speaks not to the act, but to the property. The damage must be the result of the public entity's deliberate taking or damaging of the property in order to accomplish the public purpose. This is the meaning we ascribe to the constitutional phrase "for public use."² In the remainder of this opinion we shall elaborate on the ways in which such deliberate action by the public entity³ may be alleged to state a claim for inverse condemnation.

Electro-Jet's count in inverse condemnation did not allege any action by the City amounting to a deliberate (as we shall define that term in this opinion) damaging of its property by the City, and so we conclude that the trial court correctly dismissed that count. However, it is well settled that a complaint should be dismissed for failure to state a claim only when it appears that the plaintiff could not recover under any state of facts provable under the claim. E.g., Petty v. Bank of New Mexico Holding Co., 109 N.M. 524, 526, 787 P.2d 443, 445 (1990). As we discuss below, various states of fact are possible under which Electro-Jet could recover through its inverse condemnation count. We are therefore unwilling to sustain the court's dismissal of that count with prejudice; rather, we think that Electro-Jet should be given an opportunity to allege and prove facts, of the sort discussed below, that would entitle it to compensation by way of inverse condemnation. Accordingly, we vacate the trial court's order and remand with instructions to permit Electro-Jet to amend its complaint to allege facts sufficient, under the principles outlined below, to assert a claim for inverse...