State by Humphrey v. Baillon Co.

• Decision Date: 20 July 1993
• Docket Number: No. C2-93-47,C2-93-47
• Parties: STATE of Minnesota, by Hubert H. HUMPHREY, III, its Attorney General, Petitioner, Respondent, v. BAILLON COMPANY, et al., Appellants.
• Court: Minnesota Court of Appeals

Page 799

503 N.W.2d 799

STATE of Minnesota, by Hubert H. HUMPHREY, III, its Attorney General, Petitioner, Respondent, v. BAILLON COMPANY, et al., Appellants.

No. C2-93-47.

Court of Appeals of Minnesota.

July 20, 1993.

Syllabus by the Court

1. The Minnesota Equal Access to Justice Act applies to an appeal from an

award of the commissioners in an eminent domain proceeding.

2. On these facts, appellant is not a prevailing party.

Hubert H. Humphrey, III, Atty. Gen., John C. Jeppson, Sp. Asst. Atty. Gen., St. Paul, for respondent.

Eric J. Magnuson, Stephan K. Warch, Minneapolis, for appellants.

Considered and decided by SCHUMACHER, P.J., and FORSBERG and PETERSON, JJ.

OPINION

PETERSON, Judge.

In May 1983, as part of a highway development project, respondent State of Minnesota used the "quick take" provision of the eminent domain statute, Minn.Stat. Sec. 117.042 (1982), to acquire title to real estate owned by appellant Baillon Company. The taking deprived Baillon's remaining land of direct highway access. The state offered Baillon $1300 for the taking. In March 1985, the condemnation commissioners awarded Baillon $2530 for the lost land and $302,400 for lost highway access. Both parties appealed to district court and a jury awarded Baillon $270,000. In August 1992, Baillon moved for attorney fees under the Minnesota Equal Access to Justice Act. The district court rejected the state's argument that the Act did not apply to eminent domain proceedings but ruled Baillon failed to meet the Act's requirements. We affirm.

FACTS

In 1974 Baillon purchased undeveloped real estate adjacent to a highway with the intent to develop it. In May 1983, the state, pursuant to its construction plans for Interstate Highway 94, acquired title to part of Baillon's property under the "quick take" provisions of the eminent domain statute. Minn.Stat. Sec. 117.042 (1982). As a result of the construction of I-94, the remaining portion of Baillon's property lost direct access to the highway. The state's appraiser estimated the value of the condemned land to be $1300 with no allowance for lost highway access.

In March 1985, condemnation commissioners awarded Baillon $2530 for the condemned land and an additional $302,400 for lost highway access. Both parties appealed the award to district court. At trial, two expert witnesses testified for the state; one estimated Baillon's damages at $1300 and the other at $96,000. Baillon's two experts alleged damages were $506,150 and $680,000. The jury awarded Baillon a total of $270,000, but did not apportion the amount between land loss damages and damages for lost highway access.

Baillon later moved for attorney fees under Minn.Stat. Sec. 549.21 (1992), alleging the state's litigation was in bad faith. Baillon also requested attorney fees under the Minnesota Equal Access to Justice Act (MEAJA or Act) which allows a business to recover attorney fees from the state if the business prevails in litigation against the state and shows that the state's position was not "substantially justified." Minn.Stat. Sec. 3.761-.765 (1992). After a September 1992 hearing, the district court ruled the state's litigation was not in bad faith and denied Baillon's request for attorney fees under Minn.Stat. Sec. 549.21. The district court also concluded that even though a condemnation proceeding is a "special proceeding," it is also a "civil action" to which the MEAJA applies. The district court then ruled that Baillon failed to show the state's position was not "substantially justified" under the Act and denied Baillon's motion for attorney fees. Baillon challenges the district court's denial of attorney fees under the MEAJA and the state alleges the MEAJA does not apply to condemnation proceedings.

ISSUES

1. Does the Minnesota Equal Access to Justice Act apply to condemnation proceedings?

2. Is Baillon a "prevailing party" under the Act?

ANALYSIS

Minn.Stat. Sec. 3.762(a) (1992) provides:

If a prevailing party other than the state, in a civil action or contested case proceeding other than a tort action, brought by or against the state, shows that the position of the state was not substantially justified, the court or administrative law judge shall award fees and other expenses to the party unless special circumstances make an award unjust.

I.

Whether the MEAJA applies to eminent domain proceedings is a question of statutory construction subject to de novo review on appeal. Sorenson v. St. Paul Ramsey Medical Ctr., 457 N.W.2d 188, 190 (Minn.1990). Because "the MEAJA is a limited waiver of sovereign immunity, courts should strictly construe its language." Donovan Contracting v. Minnesota Dep't of Transp., 469 N.W.2d 718, 719 (Minn.App.1991), pet for rev. denied (Minn. Aug. 2, 1991).

A. Chapter 117

The state argues Baillon cannot recover attorney fees under the MEAJA because the attorney fee provisions of chapter 117 are the exclusive method of recovering attorney fees in eminent domain proceedings. The statutory provisions cited by the state, however, do not indicate they are the exclusive method of recovering attorney fees in eminent domain proceedings. See Minn.Stat. Secs. 117.045; 117.105, subd. 2; 117.195, subd. 2 (1992). Also, while the cases cited by the state indicate recovery of attorney fees in eminent domain proceedings is "strictly statutory," they do not state that the only statutes that may be invoked to recover attorney fees in eminent domain proceedings are those in chapter 117. See County of Freeborn v. Bryson, 294 N.W.2d 851, 852 (Minn.1980); City of Minnetonka v. Carlson, 265 N.W.2d 205, 207 (Minn.1978); State by Spannaus v. Carter, 300 Minn. 495, 497, 221 N.W.2d 106, 107 (1974); In re Minneapolis Community Dev. Agency, 447 N.W.2d 891, 894 (Minn.App.1989), pet. for rev. denied (Minn. Jan. 12, 1990); Finally, the MEAJA was not enacted until 1986; 1986 Minn.Laws ch. 377, Secs. 1-7, and Minneapolis Community Dev. Agency, the only case cited by the state that does not predate the MEAJA, does not mention the Act. The state has not demonstrated the attorney fee provisions of chapter 117 are the exclusive method to recover attorney fees in eminent domain proceedings.

B. MEAJA

The state also alleges the MEAJA is inapplicable to eminent domain proceedings because eminent domain proceedings are "special proceedings" rather than the "civil actions" or "contested case proceedings" to which the Act explicitly applies.

In Antl v. State, 220 Minn. 129, 19 N.W.2d 77 (1945), the supreme court stated: "Condemnatory proceedings in the exercise of the right of eminent domain are not civil actions or causes within the meaning of the constitution, but special proceedings, only quasi judicial in their nature." Id. at 133, 19 N.W.2d at 79 (quoting State ex rel. Simpson v. Rapp, 39 Minn. 65, 67, 38 N.W. 926, 928 (1888)). ¹ Even if we assume that eminent domain proceedings are "special proceedings," it is not necessary to conclude that they may not be treated as civil actions.

In Schiltz v. City of Duluth, 449 N.W.2d 439, 440-41 (Minn.1990), the supreme court considered whether a motion for a new trial is authorized and appealable in a mandamus action as in a civil action. The court acknowledged that mandamus proceedings are "special proceedings," but did not conclude that this categorization, by itself, resolved the issue. Instead, the court examined provisions of the mandamus statute and considered the nature of a mandamus proceeding. Id.

Specifically, the court observed:

Minn.Stat. Sec. 586.08 (1988) states that, in a mandamus action, "[pleadings] shall be construed and amended, and the issues tried, and further proceedings had, in the same manner as in a civil action." Similarly, Minn.Stat. Sec. 586.09 (1988) provides for an appeal from the district court to the court of appeals "as in other civil cases."

Id. at 440 (alteration in original).

The court then held that

since the legislature has indicated its intention that these matters are to proceed as other civil cases, a motion for a new trial in mandamus proceedings is authorized and appealable pursuant to Minn.R.Civ.App.P. 103.03(d). * * * We acknowledge by our holding today that while not all "special proceedings" carry with them the indicia of a trial, mandamus proceedings are so similar, both in practice and in principle, that it is reasonable for the aggrieved party to seek the same post-decisional relief.

Id. at 441.

Thus, under Schiltz, the fact that a proceeding is a "special proceeding" does not preclude treating it as a civil action. The critical question is the degree to which the special proceeding carries the "indicia of a trial."

An appeal from an award of the commissioners

may be noticed for trial and tried except as herein otherwise provided as in the case of a civil action * * *. The owners shall go forward with the evidence and have the burden of proof as in any other civil action * * *. The court or jury trying the case shall reassess the damages de novo.

Minn.Stat. Sec. 117.175, subd. 1 (1992) (emphasis added). The emphasized text indicates that the legislature intended that an appeal from the commissioners' award in an eminent domain proceeding be conducted in a manner similar to a trial in a civil action.

An appeal from an award of the commissioners has the "indicia of a trial." The nature of the proceeding is sufficiently similar "in practice and in principle" to civil proceedings to apply the civil rules under Schiltz. See State by Lord v. Pearson, 260 Minn. 477, 482, 110 N.W.2d 206, 210 (1961) (under predecessor eminent domain provisions, appeal of a commissioners' award was conducted under the rules of civil procedure). Under the rules, the action functionally becomes a civil action. See Minn.R.Civ.P. 2 ("[t]here shall be one form of action to be known as 'civil action' "). ² One of the incidents of a civil action in which the state is a party is the right to seek attorney fees under the MEAJA. Minn.Stat. Sec. 3.762(a...