Nesti v. Vt. Agency of Transp.

• Decision Date: 06 January 2023
• Docket Number: 22-AP-096
• Citation: 2023 VT 1
• Parties: Frances Nesti v. Vermont Agency of Transportation et al.
• Court: Vermont Supreme Court

2023 VT 1

Frances Nesti
v.
Vermont Agency of Transportation et al.

No. 22-AP-096

Supreme Court of Vermont

January 6, 2023

On Appeal from Superior Court, Chittenden Unit, Civil Division

Helen M. Toor, J. (motion to dismiss); Samuel Hoar, Jr., J. (final order)

Alexander J. LaRosa of MSK Attorneys, Burlington, for Plaintiff-Appellant.

Susanne R. Young, Attorney General, and Ryan P. Kane, Assistant Attorney General, Montpelier, for Defendant-Appellee.

Present: Reiber, C.J., Eaton, Carroll, Cohen and Waples, JJ.

CARROLL, J.

¶ 1. Landowner Frances Nesti appeals two civil-division orders resolving multiple claims in favor of the Vermont Agency of Transportation (VTrans). We affirm.

¶ 2. The following facts are undisputed unless otherwise noted. In 2006, VTrans rebuilt Route 7 in South Burlington and Shelburne. The project included constructing a new, enclosed stormwater-drainage-management system to collect stormwater from the widened road surface. The new system directed stormwater downhill from the road in a westerly direction toward Lake Champlain. Nesti's property lies west of Route 7 and abuts the lake.

¶ 3. VTrans obtained a discharge permit from the Agency of Natural Resources to reconstruct the drainage system. The permit application materials represented that stormwater

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discharges would increase relative to preconstruction flows, and VTrans does not dispute that they have. VTrans has made no material change to the system since 2006.

¶ 4. At some point after the reconstruction, the parties dispute exactly when, Nesti began to notice the stormwater runoff was forming a ravine where there had previously been a dry depression. Stormwater did, however, flow over the depression from time to time before 2006. Nesti engaged in a series of conversations with VTrans and Department of Environmental Quality (DEQ) personnel regarding the issue beginning in 2009 or 2010. In January 2013, a VTrans employee sent an email to Nesti representing that "[VTrans'] State legal section . . . believe[s] the State is in the clear," that" 'downhill' property owners have the duty to accept the natural flow of water from 'uphill' properties," and where the State does not acquire "special-purpose easements" to divert water from road surfaces, "it is also possible for the State to have acquired drainage easements by open, notorious and continuous use which has lasted [fifteen] or more years."

¶ 5. Nesti filed suit on December 31, 2018, seeking damages and injunctive relief. She initially pleaded takings, trespass, and private-nuisance claims, and later added claims of ejectment and removal of lateral support.

¶ 6. VTrans moved to dismiss all claims on the basis that each was barred by the six- year statute of limitations for civil actions, 12 V.S.A. § 511, and the doctrine of sovereign immunity. VTrans also argued that the ejectment and lateral support causes of action failed to state a claim. Nesti countered that the fifteen-year statute of limitations for actions for recovery of land, 12 V.S.A. § 501, applied to each claim rather than § 511, and the continuing-tort doctrine caused her trespass and nuisance claims to continually accrue with each new runoff event, even if the claims were subject to § 511.

¶ 7. The civil division dismissed Nesti's takings claim, concluding that the applicable statute of limitations was § 511, not § 501. It concluded that § 511 also applied to Nesti's trespass and nuisance claims. The court found that Nesti's causes of action accrued before December 31, 2012,

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which was the cutoff date for her December 31, 2018, complaint. However, the court permitted Nesti's trespass and nuisance claims to proceed to summary judgment on the question of whether they were continuing torts, and denied the State's motion to dismiss them under the doctrine of sovereign immunity. The court dismissed Nesti's ejectment and lateral support causes of action for failing to state a claim, and Nesti does not appeal those determinations.

¶ 8. Following discovery, VTrans moved for summary judgment on the remaining claims. The civil division concluded that sovereign immunity failed as a defense to Nesti's claims because VTrans could not prove its decisionmaking regarding the stormwater system fit within the discretionary function exception under the Vermont Tort Claims Act, 12 V.S.A. § 5601(e)(1). The court again analyzed Nesti's argument that her takings and tort claims were not time-barred and again concluded that § 511 applied. It also found that Nesti's communications with VTrans and DEQ personnel did not support a conclusion that VTrans was equitably estopped from raising a statute-of-limitations defense. The court lastly determined that the continuing-tort doctrine did not save Nesti's trespass and nuisance claims because it was unlikely this Court would adopt the doctrine, that if it did adopt the doctrine it would not do so here, and the lack of any tortious conduct within the limitations period would take the case out of the doctrine's operation in any event. The court entered judgment for VTrans on all claims.

¶ 9. On appeal Nesti makes essentially four arguments: (1) that her takings claim is not time-barred because it is subject to the fifteen-year limitations period for bringing claims to recover lands under 12 V.S.A. § 501; (2) to the extent the takings claim is time-barred under 12 V.S.A. § 511, it violates the federal and Vermont Constitutions; (3) § 501 also applies to her trespass and nuisance claims; and (4) if § 501 does not apply to the tort claims, they are not time-barred under the continuing-tort doctrine. Though the civil division revisited the question of which statute of limitations to apply to Nesti's takings and tort claims in its summary-judgment decision, we will

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apply our standard of review for grants of motions to dismiss to (1), (2), and (3), and our standard of review for grants of summary judgment to (4).

¶ 10. "A motion for failure to state a claim may not be granted unless it is beyond doubt that there exist no facts or circumstances that would entitle the plaintiff to relief." Kaplan v. Morgan Stanley & Co., 2009 VT 78, ¶ 7, 186 Vt. 605, 987 A.2d 258 (mem.) (quotation omitted). The "Court assumes that all well pleaded factual allegations in the complaint are true, as well as all reasonable inferences that may be derived from therefrom." Id. (quotation omitted).

I. Takings Claim

¶ 11. Nesti argues that her takings claim is subject to the fifteen-year statute of limitations for bringing actions to recover lands under 12 V.S.A. § 501, not the six-year statute of limitations for civil actions under 12 V.S.A. § 511. Nesti argues, in effect, that because VTrans could obtain a prescriptive easement or adversely possess her property after the fifteen-year limitations period, her takings claim cannot be cut off at six years under § 511 because that would be tantamount to granting the State a property interest without just compensation nine years before it could make out a prima facie claim for such an interest.

¶ 12. "The government cannot take private property for public use 'without just compensation.'" Lorman v. City of Rutland, 2018 VT 64, ¶ 35, 207 Vt. 598, 193 A.3d 1174 (first quoting U.S. Const. amend. V; and then citing Vt. Const. ch. I, art. 2). "[T]he purpose of the Takings Clause is 'to bar Government from forcing some people alone to bear public burdens which, in all fairness and justice, should be borne by the public as a whole.'" Ondovchik Fam. Ltd. P'ship v. Agency of Transp., 2010 VT 35, ¶ 19, 187 Vt. 556, 996 A.2d 1179 (quoting Armstrong v. United States, 364 U.S. 40, 49 (1960)). "Broadly speaking, the [government] may take property pursuant to its power of eminent domain in one of two ways: it can enter into physical possession of property without authority of a court order; or it can institute condemnation proceedings . . . ." United States v. Dow, 357 U.S. 17, 21 (1958). When the government does not

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institute condemnation proceedings before taking physical possession of property, the owner must seek just compensation in an inverse-condemnation suit. United States v. Bedford Assocs., 618 F.2d 904, 918 n.28 (2d Cir. 1980). "[L]ong-established law holds that inverse...