JL MATTHEWS INC. v. Maryland-National Capital Park & Planning Commission

• Decision Date: 05 March 2002
• Docket Number: No. 65,65
• Citation: 368 Md. 71,792 A.2d 288
• Parties: J.L. MATTHEWS, INC. v. MARYLAND-NATIONAL CAPITAL PARK AND PLANNING COMMISSION.
• Court: Maryland Court of Appeals

792 A.2d 288

368 Md. 71

J.L. MATTHEWS, INC. v. MARYLAND-NATIONAL CAPITAL PARK AND PLANNING COMMISSION.

No. 65, Sept.Term, 2001.

Court of Appeals of Maryland.

March 5, 2002.

Thomas H. Haller (Gibbs & Haller, on brief), Lanham, for petitioner.

Michele M. Rosenfeld, Associate Gen. Counsel (Adrian R. Gardner, Gen. Counsel, on brief), Silver Spring, for respondent.

Thurman W. Zollicoffer, Jr., City Sol., Baltimore, Edward J. Gilliss, County Atty., Towson, on brief of Amici Curiae Mayor and city Council of City of Baltimore, Baltimore County, Caroline County, County Com'rs of Charles, Hartford, and Montgomery Counties, and County Com'rs of Washington County, amici curiae for respondent. Argued before BELL, C.J., ELDRIDGE, RAKER, WILNER, CATHELL, HARRELL and BATTAGLIA, JJ.

HARRELL, Judge.

On 15 March 2000, the Maryland-National Capital Park and Planning Commission ("the Commission"), Respondent, filed a complaint for condemnation in the Circuit Court for Montgomery County seeking to acquire fee simple title to a 29,238 square foot parcel of land located in the City of Takoma Park ("the Property"). At the time of initiation of the condemnation action, the Property was owned by J.L. Matthews, Inc., Petitioner, which recently had obtained the requisite approvals and permits from Montgomery County to develop eight townhouses on the Property. After filing the complaint for condemnation, Respondent filed a motion for a temporary restraining order, and later a motion for a preliminary injunction, to prevent Petitioner "from carrying out construction activity on the property" until the case was tried. The Circuit Court granted each motion on 17 March 2000 and 27 March 2000, respectively.

In its answer, filed on 6 April 2000, Petitioner argued that the issuance of the temporary restraining order and the preliminary injunction prevented the construction and marketing of the eight townhouses on the Property, and sought $200,000 in injunction damages in excess of any fair market value condemnation award. In response, the Commission filed two motions in limine requesting that Petitioner be prohibited from presenting certain evidence relating to the injunctions. On 12 June 2000, the first day of the condemnation trial, the Circuit Court granted Respondent's motions in limine. As to the first motion, the court prohibited Petitioner from presenting evidence of "lost profits, costs, and expenses ... being requested over and above the ... fair market value of the property at th[e] time [of the proceeding]."¹ In the second ruling, the court "preclude[d] any evidence... with respect to any damages suffered by [Petitioner] as a result of the preliminary injunction." In addition, the Circuit Court granted Respondent's motion for partial summary judgment on the question of public necessity. Following the trial, the jury inquisition awarded Petitioner $320,000 as just compensation for the Property.

On 12 July 2000, Petitioner filed an appeal to the Court of Special Appeals. Pertinent to this case, Petitioner specifically challenged the Circuit Court's orders granting Respondent's motions for injunctive relief and its ruling precluding Petitioner from offering certain damages evidence in the condemnation trial. In an unreported decision, the Court of Special Appeals found no abuse of discretion and affirmed the judgment of the Circuit Court. According to the Court of Special Appeals, the Circuit Court acted within its discretion in granting the injunction and, similarly, did not err in excluding Petitioner's proposed evidence of the impact of the injunctions on fair market value at trial. We granted Petitioner's petition for writ of certiorari, J.L. Matthews, Inc. v. Md.-Nat'l Capital Park and Planning Comm'n, 365 Md. 472, 781 A.2d 778 (2001), to consider the following questions:

I. Whether the Circuit Court erred in granting the Commission's requests for a temporary restraining order and preliminary injunction prohibiting J.L. Matthews, Inc., from developing its property prior to the condemnation trial.

II. Whether the Circuit Court erred in granting the Commission's second motion in limine excluding evidence of damages incurred by J.L. Matthews, Inc., as a result of the temporary restraining order and preliminary injunction.

I.

A. Relevant Factual Record

In 1990, Petitioner, J.L. Matthews, Inc.,² purchased a 29,238 square foot parcel of land containing a single family home, located at the intersection of Orchard Avenue and Sligo Mill Road in the then Prince George's County portion of the City of Takoma Park ("the City"). At the time, the City was divided between Montgomery County and Prince George's County. After the purchase, Petitioner "pursued the requisite development approvals from" Respondent (a bi-county governmental entity serving Prince George's and Montgomery Counties) and Prince George's County to develop and construct eight townhouses on the Property. In 1994, Petitioner obtained those approvals, but put the development on hold because the housing market was "in a slight slump at that time."

In 1997, Petitioner was "ready to pull [its] building permit and begin construction." On 1 July 1997, however, the City became unified under the jurisdiction of Montgomery County. As a result, the portion of the City in which the Property was located became part of Montgomery County.³ Petitioner, therefore, had to undergo another development review and permit approval process in Montgomery County in order to proceed with its construction plans.⁴ This included, in part, "getting exceptions to comply with Montgomery County set-backs," "going through a re-subdivision process to divide ... one site into two lots," and submitting a landscape plan.

On 22 July 1999, Respondent's Montgomery County Planning Board approved Petitioner's preliminary plan of subdivision for the Property. Following that approval, Petitioner obtained sewer connection approvals from the Washington Suburban Sanitary Commission and paid the necessary sewer connection fees for the proposed townhouses. Then, in September 1999, Mr. William Gries, a land acquisition specialist for Respondent, contacted Petitioner and informed it that Respondent "had an interest in acquiring [the Property]" for development of a neighborhood park and that Respondent was having the Property appraised.⁵

Two months later, on 14 December 1999, Mr. Gries sent a letter to Petitioner offering $302,250 for the Property, reflecting "the average of [Respondent's] two appraisal reports, less an amount for the estimated demolition costs associated with the old improvement on the property." The letter indicated that "funds w[ould] not be available to complete this acquisition until after July 1, 1999," but that Respondent was "prepared to enter a Land Purchase Contract ... to establish[ ] a settlement date no later than July 31, 2000." Petitioner, on 5 January 2000, declined Respondent's offer, citing its "initial costs" in obtaining permits first in Prince George's County and later in Montgomery County and its "expected profit from the project of about 10% over and above the value of the land."

On 4 February 2000, Mr. Gries sent another letter to Petitioner "increasing [the] original ... offer of $302,250 to $337,700," and advising Petitioner that if it did not accept the offer by February 10th, he would "report to the Montgomery County Planning Board" and would "ask the Board to decide whether or not it wants to use its eminent domain authority to acquire t[he][P]roperty."⁶ Petitioner declined that offer as well and informed Mr. Gries that it had applied for a building permit for the Property.⁷

On 10 February 2000, after Petitioner declined Respondent's second offer, the Montgomery County Planning Board of the Commission, in a closed executive session, voted to declare the Property "a desirable property for the purpose of extending the Orchard Avenue Local park ... [,] approved the staff recommendation to proceed with condemnation to acquire the property, and authorized staff to continue negotiations, authorizing up to a maximum of $350,000.00." Despite the increased authorized acquisition price, however, Mr. Gries made no further offers to Petitioner following the closed session.

Two weeks later, on 24 February 2000, Petitioner applied for and was issued a building permit for the Property by the Montgomery County Department of Permitting Services. After obtaining the permit, Petitioner began "to comply with the requirements to build," including trenching the land and erecting silt fencing, having gravel delivered, and communicating with its excavator and its "concrete foundation people." While this was on-going, in March 2000, the Montgomery County Planning Board published its Draft Takoma Park Master Plan, in which it recommended the "acquisition of the Property for a future playground, basketball court, and neighborhood gathering space in the Pinecrest area of Takoma Park."

B. Procedural History

On 15 March 2000, Respondent filed a complaint in the Circuit Court for Montgomery County for condemnation of the Property. Respondent next filed on 17 March 2000 a motion for temporary restraining order or, in the alternative, motion for preliminary injunction. In that motion, Respondent sought to "prevent [Petitioner] from carrying out construction activity on the Property." According to Respondent, if Petitioner were allowed to continue with the construction activity, it would "destroy the existing trees and vegetation on the site" and might require Respondent to "expend additional public funds to reimburse [Petitioner] for the increased fair market value of the Property,... [to] remove any improvements constructed, or to replace any vegetation cleared." If Respondent were "required to expend additional public funds," it maintained that it would not "be able to devote those additional funds to acquire and/or develop other parkland within the County for the citizens of Montgomery...