Repko v. Cnty. of Georgetown
| Decision Date | 06 January 2016 |
| Docket Number | Appellate Case No. 2014–000156.,No. 5374.,5374. |
| Citation | 785 S.E.2d 376,416 S.C. 22 |
| Court | South Carolina Court of Appeals |
| Parties | David M. REPKO, Appellant, v. COUNTY OF GEORGETOWN, Respondent. |
Ryan Patrick Compton, Stephen Lewis Goldfinch, Jr., and Thomas William Winslow, all of Goldfinch Winslow, LLC, of Murrells Inlet, for appellant.
Robert L. Widener, of McNair Law Firm, PA, of Columbia, and David J. Mills, of McNair Law Firm, PA, of Pawleys Island, for respondent.
In this negligence action, David M. Repko appeals the trial court's granting of a directed verdict in favor of Georgetown County (the County). Repko argues the trial court erred in (1) Article V, Section 3–1 of the County Development Regulations (the Regulations) to preclude a “tort-like” duty when the plain language of that provision disclaims only a “ financial-like” obligation1 ; (2) relying on the Regulations' “sovereign immunity” provision when that provision is unenforceable because it is preempted by the South Carolina Tort Claims Act (TCA); (3) finding the Regulations did not create a special duty owed to him under the “special duty test”; (4) subsections 15–78–60(4), (5), and (13) of the TCA provided the County with immunity to his negligence claim; and (5) not recusing itself based upon prior business relationships concerning the transactions involved.
Repko is the owner of two lots in Phase 2–D–1 of the West Stewart Subdivision of Harmony Township—a planned unit development in Georgetown County. In April 2012, he filed a civil action for damages against the County. He alleged the County's gross negligence in handling a financial guarantee posted by the developer, Harmony Holdings, LLC (the Developer), resulted in the loss of most of the funds that were to be used in building the subdivision's infrastructure. Repko asserted (1) the Developer failed to complete the infrastructure, (2) there were insufficient funds to complete the infrastructure (due to the County's gross negligence), and (3) the lack of infrastructure reduced his property value to “zero.” As a result of the County's negligence, Repko sought to recover “past and future actual damages.”
The County filed an answer, denying liability and raising several affirmative defenses. The County alleged (1) it did not owe a duty to Repko; (2) the TCA2 —specifically, subsections 15–78–60(1), (2), (4), (5), (12), and (13) of the South Carolina Code (2005)—barred Repko's claims; and (3) the statute of limitations also barred the claims.
Repko's case proceeded to trial, where the following facts developed. Wesley Bryant, the County attorney, explained that in South Carolina, a developer is generally not allowed to sell lots that do not have the requisite infrastructure—roads, water, and sewer—prior to their development. Under the Regulations, however, a developer could post cash, bonds, financial guarantees, or letters of credit in lieu of completing the infrastructure before selling the lots. Bryant stated the purpose of a financial guarantee is to ensure money is available to complete the subdivision's infrastructure “if the developer goes belly up.” Bryant explained a letter of credit is “a document ... from a financial institution to the County as a beneficiary that simply states that the development has a financial guarantee of ... the proposed total cost of the infrastructure to be placed ... in that development.” Under a letter of credit, the bank is the issuer and the County is the beneficiary. Bryant testified property owners are not beneficiaries on a letter of credit but a letter of credit does protect the property owners. Bryant stated that, under the Regulations, the County is not required to accept a financial guarantee and may require the developer to complete the infrastructure before it is allowed to sell lots in a subdivision.
The County regulates improvements to major subdivisions through Article V of the Regulations. Article V, Section 1–5 provides, “Final plans shall not be approved for recording unless the [developer] has installed the required improvements as specified and required in this Article, or has provided a financial guarantee as specified in Section 3 of this Article.” “Required improvements” include installation of monuments at street corners; a storm water management system; specified roadway improvements, including grading and paving; and utilities and services.
Article V, Section 3–1 states as follows:
The Regulations provide a procedure that must be followed if a developer wants to post a financial guarantee. First, the financial guarantee must be submitted to the County's Planning Department along with an “itemized cost estimate” for the improvements the financial guarantee will cover. The itemized cost estimate must (1) bear the original signature and seal of a licensed professional engineer, (2) be on company letterhead, and (3) be in a form acceptable to the Planning Department. Article V, Section 3–2 provides, “Upon receipt of an itemized cost estimate, the Planning Department shall forward such estimate to the appropriate departments or agencies for review.”
Under the Regulations, the County may accept a letter of credit as a financial guarantee. Article V, Section 3–3 states an approved letter of credit must (1) be equal to 125% of the approved cost estimate; (2) be issued for an initial coverage period not less than twelve months from the date the final plat is filed for recording; (3) be irrevocable, unconditional, and subject to presentation for drawing within South Carolina; (4) be payable to the County; (5) be for at least $10,000 in construction; and (6) substantially conform to a required format.
If the County accepts a financial guarantee from the developer, it generally holds the guarantee until all covered improvements are completed unless a reduction in the guarantee has been approved pursuant to the following procedure set forth in Article V, Section 3–5:
A developer may reduce a financial guarantee during the initial coverage period. A request to reduce the financial guarantee shall be submitted to the Planning Department and include a revised construction cost estimate. The Planning Department will forward the revised cost estimate to [the] County Department of Public Works for approval. Reductions of financial guarantees will not be allowed within [six] months of any previous reduction request and shall be no less than 125% of the revised construction cost estimate.
Holly Richardson, the Planning Department's chief planner, stated the County was not required to reduce a financial guarantee or letter of credit. Richardson and the Planning Department's director, Boyd Johnson, both stated that before the County would agree to reduce a letter of credit, it required “a letter from the engineer certifying that the work had been complete[d] and certifying the number[ and] the dollar amounts that were left to be done.”
In the early 2000s, the Developer began developing the Harmony Township community within Georgetown County. Although roads, utilities, and other required improvements were not constructed in the community, the Developer sought permission from the Planning Department to begin selling the undeveloped lots to buyers. The County allowed the Developer to post letters of credit as financial guarantees in lieu of completing the required improvements. The Developer posted a letter of credit for each phase of Harmony Township, including Phase 2–D–1, the phase at issue in this appeal.
In 2006, the Developer applied to Wachovia Bank to obtain a letter of credit for Phase 2–D–1. Wachovia granted the application and issued a letter of credit on May 23, 2006, in the amount of $1,301,705.63 (Wachovia letter of credit). The Wachovia letter of credit designated the County as the beneficiary and the Developer as the applicant. Shortly thereafter, the Developer submitted the Wachovia letter of credit to the Planning Department. It also submitted an engineer's estimate of $1,040,000.00 as the cost of completing the required improvements. Thus, the $1,301,705.63 Wachovia letter of credit was 125% of the engineer's estimate as required under the Regulations. The Planning Department accepted the letter of credit and permitted the Developer to sell undeveloped lots in Phase 2–D–1.
On July 20, 2006, the Developer requested a reduction in the Wachovia letter of credit. The County approved a request to reduce the letter of credit by $331,311.00. Repko presented evidence that the County approved this request despite noncompliance with the Regulations and the Planning Department's protocol. First, the County approved the request without the required letter of an engineer certifying “the work had been complete[d] and ... the dollar amounts that were left to be done.” Second, the County approved the request without “forward[ing] the revised cost estimate to the Georgetown County Department of Public Works for approval.” Third, the County approved the request even though it indicated that the Developer sought to use the letter of credit funds to pay its contractor, contrary to Article V, Section 3–3. Fourth, an engineer's cost of completion estimate made by Earthworks, the engineering firm hired by the Developer, showed the...
To continue reading
Request your trial
-
Repko v. Cnty. of Georgetown
...granted Georgetown County's petition for a writ of certiorari to review the court of appeals' decision in Repko v. County of Georgetown , 416 S.C. 22, 785 S.E.2d 376 (Ct. App. 2016). Georgetown County argues the court of appeals erred in (1) construing the County Development Regulations as ......
-
Fecas v. S.C. Dep't of Labor
...applies even if other exceptions not permitting actions for gross negligence are read to apply as well. Cf. Repko v. County ofGeorgetown, 785 S.E.2d 376, 385-86 (S.C. Ct. App. 2016), reh'g denied (May 20, 2016), cert. granted (Sept. 8, 2017). Second, LLR argues Plaintiff has not alleged fac......
-
In re Limited Certificate of Admission for Military Spouse Attorneys, Appellate Case No. 2015–001545.
...Rule 430, SCACR, attorneys holding a limited certificate to practice law in this State need not comply with the requirements of this rule.416 S.C. 22 Rule 410(h)(2), SCACR, is amended to add paragraph (h)(2)(E), which provides as follows:(E) Military Spouse Attorney Member—Rule 430 (Limited......