Kiriakides v. Sch. Dist. of Greenville
| Decision Date | 30 March 2009 |
| Docket Number | No. 26621.,26621. |
| Citation | 675 S.E.2d 439 |
| Court | South Carolina Supreme Court |
| Parties | Alex KIRIAKIDES, III, Mary Ann Kiriakides, and Michael Kiriakides, as Personal Representatives of the Estate of Alex Kiriakides, Jr., Appellants/Respondents, v. The SCHOOL DISTRICT OF GREENVILLE COUNTY, South Carolina, a Political Subdivision, Respondent/Appellant. |
Thomas W. Traxler and Travis V. Olmert, both of Carter, Smith, Merriam, Rogers & Traxler, of Greenville, for Respondent-Appellant.
Alex Kiriakides, Jr. (Kiriakides) sued the School District of Greenville County (the School District) to prevent it from condemning his property. He also sought damages for inverse condemnation for the School District's alleged delay in this matter, as well as attorneys' fees. The master-in-equity found in favor of the School District on the condemnation claims, but awarded attorneys' fees to Kiriakides. Kiriakides and the School District filed cross appeals.1 We affirm.
Kiriakides owned property in Greenville County that was formerly the site of the Bijou Theater, an eight-theater multiplex. During the first half of 2001, the property was under a monthly lease to United Artists. United Artists was in bankruptcy proceedings during this time.
In February 2001, a real estate agent working for the School District, Henry Garrison, advised Kiriakides that the School District was interested in purchasing the property. The Kiriakides property adjoined Wade Hampton High School, and the School District wanted to renovate and expand the school. Kiriakides initially informed Garrison that he did not want to sell the property, but that he would lease it.
In June 2001, United Artists stopped paying rent and moved out of the theater. Kiriakides and the School District continued their negotiations for a voluntary sale until approximately April 2002, but when the negotiations proved unsuccessful, the School District began the process to acquire the property by eminent domain.
The School District retained an appraiser as part of the preliminary preparation for a condemnation proceeding, but Kiriakides refused to allow entry on his property. On April 30, 2002, the School District filed a complaint seeking an order of entry. On May 1, 2002, the circuit court issued an "Order for Entry Pursuant to S.C.Code Ann. § 28-2-70 (1991)" allowing the School District to enter upon the property to make a survey, to determine the location of proposed improvements, and to prepare an appraisal.
Due to the workload of the appraiser, the appraisal was first given to the School District in late July 2002. On or about August 12, 2002, the School District served Kiriakides with a "Condemnation Notice and Tender of Payment" pursuant to the South Carolina Eminent Domain Procedure Act.2
The School District never filed the condemnation action with the court, however, because on August 23, 2002, Kiriakides instituted the current action challenging the right of the School District to condemn his property. In his pleadings, Kiriakides additionally sought damages for inverse condemnation and attorneys' fees, alleging "[t]he stigmatization of [his] property as well as the unreasonable delay in commencing condemnation [proceedings] has amounted to an inverse condemnation of [his] property."
In May 2003, because of the urgency of the school construction project and the existence of this litigation challenging the right to proceed with condemnation, the School District notified Kiriakides that it had abandoned its efforts to condemn the property. The School District ultimately purchased a different piece of property located nearby.
Thereafter, in December 2005, the master held a bench trial regarding Kiriakides's complaint. By order filed May 4, 2006, the master ruled in favor of the School District, finding as follows: (1) Kiriakides's challenge to the School District's right to condemn his property was moot because the School District had abandoned its condemnation efforts; (2) any challenge to the delay in the condemnation proceedings was likewise moot and there was no evidence of delay, in any event; and (3) Kiriakides had not established his inverse condemnation claim and was not entitled to damages.
After a post-trial motion and hearing, the master awarded Kiriakides $6,500 in attorneys' fees pursuant to a provision in the South Carolina Eminent Domain Procedure Act based on his finding that the School District had "abandoned its condemnation efforts." This cross appeal followed.
On appeal, Kiriakides challenges the master's ruling in favor of the School District on his claim for inverse condemnation, and the School District challenges the master's award of attorneys' fees to Kiriakides.
Kiriakides contends the master erred in denying his claim for inverse condemnation. We disagree.
"The concept of inverse condemnation was originally conceived as a remedy for the physical taking of private property without following eminent domain procedures." 11A Eugene McQuillin, The Law of Municipal Corporations § 32.132.20 (3d ed.2000) (citing, inter alia, Woods v. State, 314 S.C. 501, 431 S.E.2d 260 (Ct.App.1993)). "Inverse condemnation is, therefore, a cause of action against a governmental defendant to recover the value of property which has been taken in fact by a governmental entity although not through eminent domain procedures." Id.
"One basic difference between condemnation and inverse condemnation is that in condemnation proceedings, the governmental entity is the moving party, whereas, in inverse condemnation, the property owner is the moving party." South Carolina State Highway Dep't v. Moody, 267 S.C. 130, 136, 226 S.E.2d 423, 425 (1976).
A landowner has the burden of proving damages for the taking of the landowner's property, whether through condemnation proceedings or by inverse condemnation. Brenco v. South Carolina Dep't of Transp., 377 S.C. 124, 128, 659 S.E.2d 167, 169 (2008) (citing Owens v. South Carolina State Highway Dep't, 239 S.C. 44, 54, 121 S.E.2d 240, 245 (1961)).
Not all damages that are suffered by a private property owner at the hands of the governmental agency are compensable. Woods v. State, 314 S.C. 501, 504, 431 S.E.2d 260, 262 (Ct.App.1993). The property itself must suffer some diminution in substance, or it must be rendered intrinsically less valuable. Id.
"[I]n an inverse condemnation case, the trial judge will determine whether a claim has been established; the issue of compensation may then be submitted to a jury at either party's request." Cobb v. South Carolina Dep't of Transp., 365 S.C. 360, 365, 618 S.E.2d 299, 301 (2005).
Inverse condemnation claims can result from two instances: "An inverse condemnation may result from the government's physical appropriation of private property, or it may result from government-imposed limitations on the use of private property." Byrd v. City of Hartsville, 365 S.C. 650, 656, 620 S.E.2d 76, 79 (2005).
In the second instance, where there is a regulatory inverse condemnation, there are two elements that must be shown: (1) affirmative conduct, and (2) a taking. Id. at 657, 620 S.E.2d at 80. The analysis of whether a taking has occurred is governed by the case of Penn Central Transportation Co. v. City of New York, 438 U.S. 104, 98 S.Ct. 2646, 57 L.Ed.2d 631 (1978) when the claim stems from an allegation of a temporary denial of less than all economically viable use of the property. Id. at 658, 620 S.E.2d at 80. "In the context of a regulatory delay, the Penn Central inquiry is whether the delay ever became unreasonable." Id. at 660, 620 S.E.2d at 81. "Until regulatory delay becomes unreasonable, there is no taking." Id.
As enumerated in Byrd, two circumstances are particularly important: (1) the economic impact on the claimant, especially the extent to which the governmental entity has interfered with the claimant's investment-backed expectations, and (2) the character of the governmental action. Id. at 659 620 S.E.2d at 80 (citing Penn Central, 438 U.S. 104, 124, 98 S.Ct. 2646, 57 L.Ed.2d 631 (1978)).
In the case now before us, the parties conceded, and the master specifically found, that there was never any physical occupation or appropriation of Kiriakides's property, the first type of taking under Byrd. Rather, Kiriakides asserted the stigmatization of his property by the threat of condemnation amounted to a regulatory inverse condemnation under the second prong of Byrd.
In rejecting this assertion of a regulatory inverse condemnation, the master found there was no act and no taking by the School District that would come within the parameters of an inverse condemnation claim. The master noted:
The master stated that The master further stated:
The master additionally observed his conclusion was supported by public...
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