Electro-Nucleonics, Inc. v. Washington Suburban Sanitary Com'n

• Decision Date: 01 September 1988
• Docket Number: INC,ELECTRO-NUCLEONIC,No. 58,58
• Parties: v. WASHINGTON SUBURBAN SANITARY COMMISSION. ,
• Court: Maryland Court of Appeals

Page 361

315 Md. 361

554 A.2d 804

ELECTRO-NUCLEONICS, INC. v. WASHINGTON SUBURBAN SANITARY COMMISSION.

No. 58, SEPT. TERM, 1988.

Court of Appeals of Maryland.

March 13, 1989.

Motion for Reconsideration Denied May 5, 1989.

David D. Freishtat (Larry N. Gandal, Ian C. Ballon, Shulman, Rogers, Gandal, Pordy & Ecker, P.A., on brief), Rockville, for petitioner and cross-respondent.

Wilbur D. Preston, Jr. (Richard J. Magid, William F. Ryan, Jr., Carol A. Zuckerman, Whiteford, Taylor & Preston, Baltimore, and Nathan J. Greenbaum, Robert H. Drummer, Hyattsville, on brief), for respondent and cross-petitioner.

Argued before MURPHY, C.J., ELDRIDGE, COLE, RODOWSKY, McAULIFFE and BLACKWELL, JJ., and CHARLES E. ORTH, Jr., Associate Judge of the

Court of Appeals of Maryland (retired, Specially Assigned).

RODOWSKY, Judge.

Appellant, the owner of the fee simple estate in property adjacent to that condemned by the appellee, relies on two theories to support this inverse condemnation case. The first submission is that the appellee has taken property of the appellant in the form of the benefit of certain restrictive covenants which had burdened the condemned property. On that theory this action is barred by limitations. Appellant also submits that the appellee's use of the adjacent property effects a taking of the appellant's fee simple property, but there is no evidence to support a taking in the constitutional sense. Consequently, we shall affirm the circuit court's entry of summary judgment for the appellee.

This case is an offshoot of the litigation involved in Washington Suburban Sanitary Comm'n v. Frankel, 57 Md.App. 419, 470 A.2d 813 (1984), judgment vacated on other grounds, 302 Md. 301, 487 A.2d 651 (1985). On July 8, 1980, Washington Suburban Sanitary Commission (WSSC) acquired the fee simple title to a parcel of approximately 115 acres, known as "Site 2," in an industrial park of some 347 acres lying east of U.S. Route 29 and south of Randolph Road in Montgomery County. In litigation involving the disposition of sewage sludge generated at the District of Columbia's Blue Plains sewage treatment plant, which served part of Montgomery County, the United States District Court for the District of Columbia had ordered that a sewage sludge composting facility be located and operated at Site 2 by WSSC.

According to the terms of declarations recorded in the land records in 1956 and 1959, restrictive covenants had been imposed on the 347 acre tract. Those restrictions, in part, prohibited using any of the land for a dump or sanitary landfill, dumping of waste material or refuse, permitting waste or refuse to remain upon any part of the property outside of buildings, and emitting objectionable odors outside of lot lines. The only defendants named in the eminent domain action by WSSC to acquire Site 2 were the owners of the parcels comprising that site. No owners of dominant estates benefited by the restrictive covenants were joined.

On November 6, 1980, WSSC filed a declaratory judgment action (Frankel ) against identified and unidentified property owners both within and outside of the industrial park, who claimed

"damages or payment ... or relief of any kind, purportedly stemming from the violation, abrogation, or non-observance, or the anticipated violation, abrogation or non-observance of record covenants ... or for a purported 'taking' of property rights or interests without the payment of just compensation, all stemming from the acquisition of [Site 2] for a public use."

The instant appellant, Electro-Nucleonics, Inc. (Plaintiff), has since 1971 owned Lot 6 in the industrial park. That lot is adjacent to Site 2.

In its Frankel opinion, the Court of Special Appeals held that the owners of property within the industrial park owned "dominant tenements with respect to the restrictive covenants to which Site 2 was subject prior to its acquisition by WSSC" and that the owners of those properties clearly had a "right to compensation by virtue of WSSC's taking of the property interest which those negative easements represent." 57 Md.App. at 435, 470 A.2d at 821. This Court vacated the mandate of the Court of Special Appeals for want of a final judgment in the trial court. We pointed out that most of the defendants in Frankel, anticipating a declaratory judgment adverse to WSSC's position, had counterclaimed for compensation for the taking of the covenants. Applying East v. Gilchrist, 293 Md. 453, 445 A.2d 343 (1982), we held that those counterclaims and the request for a declaratory judgment were one and the same claim for purposes of applying what is now Md.Rule 2-602(a). Hence certification of the declaratory judgment as a final judgment was not the certification of an entire claim. This Court's Frankel opinion was filed February 7, 1985.

"Instead of joining the other Industrial Park owners in filing a counterclaim in the Frankel case, Electro-Nucleonics filed this separate action in inverse condemnation on March 27, 1986." Appellant's Brief at 1. WSSC took no issue with the Plaintiff's spin-off of its claims into this separate action. Procedurally more significant is that WSSC dismissed, without prejudice, its action for declaratory relief as to Electro-Nucleonics, Inc. ¹ The relief sought in Plaintiff's separate "Complaint for Inverse Condemnation," as amended, was that a "taking be declared," that "the covenants which are described herein be condemned," and that WSSC pay to the Plaintiff $20 million "as damages for the taking of the covenants."

The two issues on which we decide this appeal were raised in summary judgment proceedings. Plaintiff, in moving for partial summary judgment as to liability, submitted that WSSC's "ownership of and activities on Site violate these covenants and amount to a taking for which Plaintiff must be compensated." Plaintiff also selected the general statute of limitations as the applicable provision and argued that the cause of action accrued on or about April 25, 1983, the date indicated by certain evidence as that on which operation of the WSSC facility commenced. ² In opposition to Plaintiff's motion, WSSC pointed out that under Plaintiff's theory, WSSC's ownership of Site 2, as well as WSSC's activities thereon, violated the "purported" restrictive covenants and that, under that theory, Plaintiff's cause of action necessarily accrued when WSSC gained title to Site 2 by condemnation in July 1980. WSSC has never formally moved for summary judgment in its favor on the limitations issue, but it is not necessary that WSSC have done so. See Md.Rule 2-501(e).

While Plaintiff's motion was pending, Maryland Port Admin. v. QC Corp., 310 Md. 379, 529 A.2d 829 (1987) was decided. Relying on QC, WSSC moved for summary judgment in its favor on the ground that "the alleged impact of WSSC's operations at Site 2 on Electro-Nucleonics' property does not constitute a constitutionally-compensable taking of property under Maryland law." (Footnote omitted). WSSC supported its motion with the deposition of Eugene H. LaBrec, Ph.D., Corporate Director of Regulatory Affairs for the Plaintiff, who was designated as Plaintiff's deposition representative.

The circuit court granted summary judgment in favor of WSSC in a ruling from the bench. In addition to those reasons discussed in its oral ruling, the circuit court specifically granted summary judgment based on "any other reasons" which WSSC had raised. The trial judge thereby negated any possibility that he would have exercised discretion to deny summary judgment in the event his more fully articulated reasons for granting summary judgment might ultimately be legally erroneous. Cf. Metropolitan Mortgage Fund v. Basiliko, 288 Md. 25, 415 A.2d 582 (1980) (a trial court ordinarily possesses discretion affirmatively to deny a summary judgment in favor of a full hearing on the merits even though the technical requirements for summary judgment have been met). Here, with respect to a taking of the covenants, the circuit court concluded that "[t]he loss to the property of Electro-Nucleonics, Incorporated was in July of 1980, if at all, when the WSSC condemned [Site 2]." The court said that "the covenants no longer exist as [they apply] to the WSSC property, and [Plaintiff is] not entitled to compensation for breach of the covenant." With respect to Plaintiff's theory that there had been a nonpossessory taking of Lot 6, the circuit court recognized that the complaint had not been based on that theory. Nevertheless, the court ruled that "there certainly is no sufficient showing to establish that the present use by WSSC [of Site 2] is causing an inverse condemnation of [Lot 6]."

We issued the writ of certiorari prior to consideration of the appeal by the Court of Special Appeals.

I

We are able, without a detailed presentation of the facts, to dispose of Plaintiff's claim to compensation based on the taking of its property in the form of the benefit of restrictive covenants burdening Site 2. In this connection we shall assume, as Plaintiff contends, that the restrictive covenants were validly established in the industrial park, that they run with the land, and that the use made of Site 2 falls within the prohibitions of the restrictions.

In Mercantile-Safe Deposit & Trust Co. v. Baltimore, 308 Md. 627, 641, 521 A.2d 734, 740 (1987), we acknowledged that "the majority rule in the United States is that a restrictive covenant running with the land is a compensable property right for condemnation purposes." We had "no difficulty, therefore, in concluding that a covenant running with the land ordinarily is a compensable property interest in the condemnation context, at least to the extent it adds measurable value to the land to which it is attached." Id. at 641, 521 A.2d at 741. In the instant case we shall also assume that the covenants at issue added measurable value to Lot 6. Nevertheless, Plaintiff's inverse condemnation claim, based on the theory of...