Lynch LLC v. Putnam County

• Decision Date: 16 December 2009
• Docket Number: No. M2008-02634-SC-R10-CV.,M2008-02634-SC-R10-CV.
• Citation: 301 S.W.3d 196
• Parties: NORMA FAYE PYLES LYNCH FAMILY PURPOSE LLC v. PUTNAM COUNTY, Tennessee et al.
• Court: Tennessee Supreme Court

301 S.W.3d 196

NORMA FAYE PYLES LYNCH FAMILY PURPOSE LLC v. PUTNAM COUNTY, Tennessee et al.

No. M2008-02634-SC-R10-CV.

Supreme Court of Tennessee, at Nashville.

June 3, 2009 Session.

December 16, 2009.

Robert A. Anderson, Nashville, Tennessee, for the appellant, Norma Faye Pyles Lynch Family Purpose LLC.

Jeffrey G. Jones, Cookeville, Tennessee and Daniel H. Rader, III, Cookeville, Tennessee, for the appellees, Putnam County, Tennessee and City of Cookeville, Tennessee.

OPINION

WILLIAM C. KOCH, JR., J., delivered the opinion of the court, in which JANICE M. HOLDER, C.J., CORNELIA A. CLARK, GARY R. WADE, and SHARON G. LEE, JJ., joined.

This appeal involves the obligation of local governments to obtain a certificate of public purpose and necessity in order to condemn private property to develop an industrial park. Putnam County and the City of Cookeville filed a condemnation complaint in Circuit Court for Putnam County but then voluntarily dismissed their complaint to allow time to obtain the certificate of public purpose and necessity required by Tenn.Code Ann. § 13-16-207(f) (Supp.2009). The property owner then filed a motion seeking attorney's fees and costs, as well as a separate action seeking a partition in kind, an accounting, and damages. In response, the City and the County opposed the property owner's request for attorney's fees and filed an answer in the partition case that included a counterclaim to condemn the property. The City and the County also moved to set aside the voluntary dismissal of their original condemnation complaint. The trial court granted the City's and the County's motion to vacate the dismissal of their condemnation complaint, consolidated the condemnation and partition proceedings, and reserved addressing the property owner's request for attorney's fees. After the trial court denied its application for an interlocutory appeal, the property owner filed an application for extraordinary appeal in the Court of Appeals. After the Court of Appeals declined to grant the extraordinary appeal, the property owner renewed its application for an extraordinary appeal in this Court. After this Court granted the property owner's application, the City and County formally abandoned their efforts to condemn the property and requested this Court to dismiss the property owner's appeal on the grounds of mootness. We have determined that the appeal should not be dismissed for mootness and that the trial court erred by failing to dismiss the City's and the County's condemnation complaint because it had been filed before the City and County obtained the certificate of public purpose and necessity required by Tenn.Code Ann. § 13-16-207(f).

I.

In order to promote economic growth, Putnam County and the City of Cookeville agreed to develop a mixed-use business park called Highlands Business Park on 367 acres southwest of Cookeville and adjacent to I-40. In July 2006, the City and the County agreed to share equally the cost of acquiring the ten tracts of mainly undeveloped property on which Highlands Business Park would be constructed. They also agreed that each of them would sell $7.2 million in general obligation bonds to finance the design and infrastructure.

The City and County then negotiated with the landowners to acquire the property and eventually purchased all the property except for an undivided one-fifth interest in three parcels that was owned by the Norma Faye Pyles Lynch Family Purpose LLC ("Lynch LLC") which was located in Nashville. These parcels, consisting of 52.88 acres, 11.30 acres, and 9.90 acres, were located on both the north and south side of I-40 in the general area where the proposed Mine-Lick Creek Interchange would be located. Whether the City or the County ever attempted to negotiate the purchase of the Lynch LLC's interest in these tracts is disputed.

On November 1, 2007, the Cookeville City Council authorized the city attorney to file an action to condemn the Lynch LLC's interest in the property. The Putnam County Commission followed suit on November 19, 2007. On February 1, 2008, the City and the County filed a petition in the Circuit Court for Putnam County seeking to acquire the Lynch LLC's¹ interest in the property by eminent domain. They also tendered $296,320 as the fair market value of the interest they were seeking to acquire.

On March 28, 2008, the Lynch LLC filed a motion to dismiss the amended petition for failure to comply with the statutory requirements that the petition fully describe the project to be constructed and that the petition recite all the statutory authority for the condemnation. In order to allow for the time necessary to obtain the certificate of public purpose and necessity required by Tenn.Code Ann. § 13-16-207 (Supp.2009), both the City and the County requested voluntary dismissal without prejudice of their amended petition in accordance with Tenn. R. Civ. P. 41.01. The trial court entered an order on May 2, 2008, dismissing the petition and taxing the costs to the City and County.

On May 6, 2008, the Lynch LLC filed a motion seeking the payment of its attorney's fees in the amount of $7,222.50 in accordance with Tenn.Code Ann. § 29-17-912(b)(2) (Supp.2009) on the ground that the City and County had abandoned the condemnation proceeding. Two days later, on May 8, 2008, the Lynch LLC filed suit against the City and the County in the Circuit Court for Putnam County seeking a partition in kind, an accounting, and damages. The City and County responded to the motion for attorney's fees that the amount of the requested fee was unreasonable and that "the eminent domain proceedings will be reinstated once [the Certificate of Public Purpose and Necessity] is obtained from the State of Tennessee." On May 30, 2008, the City and County filed their answer in the partition suit, along with a counterclaim again seeking to condemn the Lynch LLC's interest in the property.

In addition to their answer and counterclaim, the City and the County moved to vacate the May 2, 2008 order granting the voluntary dismissal of their condemnation petition and to consolidate the partition suit with the condemnation suit. They represented in their motions that they had "not abandoned their desire to procure this property by eminent domain" and that "they are in the process of procuring a certificate of public purpose so that they may proceed with the eminent domain proceedings."² They also requested that their motions be "held in abeyance pending the acquisition of said certificate of public purpose as part of the eminent domain and condemnation proceedings." On October 8, 2008, following a hearing on July 21, 2008, the trial court entered an order (1) setting aside its May 2, 2008 order granting the City and the County a voluntary dismissal, (2) consolidating the condemnation proceeding and the partition proceeding, and (3) reserving the Lynch LLC's motion for attorney's fees in the condemnation proceeding.

In a motion filed on October 15, 2008, the Lynch LLC asked, among other things, for permission to seek an interlocutory appeal under Tenn. R.App. P. 9 from the trial court's October 8, 2008 order. The trial court overruled this request in an order filed on November 13, 2008. On November 26, 2008, the Lynch LLC filed a Tenn. R.App. P. 10 application for an extraordinary appeal with the Court of Appeals. When the appellate court denied this application on December 4, 2008, the Lynch LLC filed a Tenn. R.App. P. 10 application for extraordinary appeal with this Court, limited to the following question "[w]hether a condemnation suit filed in violation of the mandated procedural requirements of Tenn.Code Ann. § 13-16-207(f) by not having first secured a Certificate of Public Purpose and Necessity should have been dismissed by the Trial Court as a violation of the procedural due process rights of the Norma Fay Pyles Lynch Family Purpose LLC." On January 22, 2009, we granted the Lynch LLC's application for an extraordinary appeal.

On February 10, 2009, the City and the County filed a notice that they desired to dismiss their condemnation petition and their condemnation counterclaim in the partition action with full prejudice. On February 17, 2009, the Putnam County Commission voted to reconfigure the Highlands project to exclude the disputed tracts. The Cookeville City Council did likewise on March 2, 2009. Three days later, on March 5, 2009, the Building Finance Committee issued two Certificates of Public Purpose and Necessity approving the reconfigured Highlands project that did not include the disputed property.

On March 17, 2009, the City and the County filed a motion in this Court requesting the dismissal of Lynch LLC's appeal on the ground of mootness. In affidavits supporting the motion, the city manager and county executive stated that the City and the County had abandoned their plans to condemn the disputed property. Based on their abandonment of their efforts to condemn the Lynch LLC's interest in the property, the City and the County insisted that "all matters pending in this appeal ... are fully moot." The Lynch LLC opposed the motion on the ground that the issue regarding the proper interpretation and application of Tenn. Code Ann. § 13-16-207(f) was an "interest of public character" that "applies to any landowner." On April 9, 2009, this Court filed an order denying the City and the County's motion to dismiss the appeal and directing the parties to address three issues: (1) whether the City's and the County's representation that they are voluntarily ceasing their condemnation action is an adequate basis for finding that the Lynch LLC's extraordinary appeal is moot, (2) whether the issue raised in the Lynch LLC's appeal is one of such great public importance that it calls for an exception to the mootness doctrine, and (3) whether and how the attorney's fees should be taxed if either or both of the underlying cases are moot.

II.

The Constitution of...