State v. Alderwoods (Oregon), Inc.

Decision Date17 September 2014
Docket NumberC085449CV,A146317.
Citation336 P.3d 1047 (Mem),265 Or.App. 572
PartiesSTATE of Oregon, acting by and through its DEPARTMENT OF TRANSPORTATION, Plaintiff–Respondent, v. ALDERWOODS (OREGON), INC., an Oregon corporation, successor by merger with Young's Funeral Home, Inc., an Oregon corporation, Defendant–Appellant, and Bank of America, N.A., a national association, as administrative agent, Defendant.
CourtOregon Court of Appeals

Charles F. Hudson, Portland, argued the cause for appellant. With him on the briefs was Lane Powell PC.

Erin C. Lagesen, Assistant Attorney General, argued the cause for respondent. With her on the brief were John R. Kroger, Attorney General, and Anna M. Joyce, Solicitor General.

Before HASELTON, Chief Judge, and ARMSTRONG, WOLLHEIM, ORTEGA, SERCOMBE, DUNCAN, NAKAMOTO, EGAN, DeVORE, TOOKEY, and GARRETT, Judges, and SCHUMAN, Senior Judge.

Opinion

PER CURIAM.

Affirmed by equally divided court.

ARMSTRONG, J., concurring.

SERCOMBE, J., concurring.

WOLLHEIM, J., dissenting.

ARMSTRONG, J., concurring.

As part of a project to improve SW Pacific Highway (Highway 99W) in Tigard, the Oregon Department of Transportation (ODOT or the state) brought a condemnation action against defendant to acquire interests in land owned by defendant that abuts Highway 99W. Among other things, the project involved the reconstruction of the sidewalk on Highway 99W and the elimination of curb cuts and driveways that had allowed vehicular access from defendant's property to the highway. Before trial, the trial court granted the state's motion in limine to exclude evidence of the diminution in the value of defendant's land as a result of its loss of access to Highway 99W. The court thereafter entered a general judgment awarding defendant just compensation of $11,792. Defendant appeals the judgment and assigns error to the order granting the state's motion in limine. I conclude that the trial court did not err in granting the motion.

Defendant owns a rectangular parcel of property whose southern boundary abuts Highway 99W near the interchange of Highway 99W and Highway 217 in Tigard. Before the state undertook to improve Highway 99W, defendant's property had direct vehicular access to Highway 99W through two driveways. The property also has indirect access to Highway 99W from Warner Avenue, which abuts the western boundary of the property and intersects Highway 99W. To orient the reader, a map of the property is included as an appendix to the opinions in this case.

As noted, ODOT undertook to improve the portion of Highway 99W that includes the highway abutting defendant's property. The state filed a condemnation action against defendant in September 2008 to acquire a temporary easement across a portion of defendant's property “for the purpose of a [construction] work area” and to acquire [a]ll abutter's rights of access, if any,” to Highway 99W. One month later, ODOT sent defendant a notice of the removal of defendant's unpermitted approaches to Highway 99W, which advised defendant that ODOT had no record of a permit for defendant's driveways and that defendant's unpermitted approaches to the highway—viz., its driveways—would be eliminated with the reconstruction of the sidewalk on Highway 99W. The notice also advised defendant that it could submit to ODOT an application for a permit for an approach to Highway 99W from defendant's property or could provide proof that the existing approaches had been established before 1949.1

Significantly, however, ODOT rules establish minimum safety standards for an approach to a state highway such as Highway 99W, and those standards require an approach to be located at least 750 feet from a highway interchange. See OAR 734–051–0125 (2008) (Table 5). Under that standard, no approach to Highway 99W would be permitted from defendant's property, because the entire length of the property that abuts Highway 99W is less than 750 feet from the interchange of Highway 99W and Highway 217. As it is, defendant did not submit an application for an approach from its property to Highway 99W, and, accordingly, the state constructed the sidewalk abutting the property without curb cuts or driveways that would allow vehicular access from the property to the highway.

The state subsequently filed a motion in limine in the condemnation action that sought to exclude any evidence of the diminished value of defendant's property due to its loss of access to Highway 99W. The state argued that the denial of access resulting from the elimination of the curb cuts and driveways constituted a denial of access to promote the efficient and safe use of the highway, that is, a regulatory restriction on access to the highway to promote its use as a highway and, consequently, that the denial of access as a result of those restrictions did not constitute a taking of the access for which compensation would be due under Article I, section 18, of the Oregon Constitution. In the state's view, because the regulatory restriction on access did not constitute a taking and because the property has access to Warner Avenue, any reduction in the value of defendant's property as a result of its loss of access to Highway 99W was not compensable. Hence, it sought to exclude evidence of the diminished value of the property due to its loss of access to Highway 99W on the ground that the evidence was not relevant.

The trial court agreed with the state and granted its motion in limine. The parties then stipulated that defendant was entitled to an award of $11,792 as just compensation for the temporary construction easement over defendant's land, but that the stipulated amount did not include compensation for the taking of defendant's right of access to Highway 99W. The trial court entered judgment accordingly. Defendant appeals, assigning error to the order granting the state's motion in limine, which we review for legal error. See, e.g., State v. Cunningham, 337 Or. 528, 536, 99 P.3d 271 (2004), cert. den., 544 U.S. 931, 125 S.Ct. 1670, 161 L.Ed.2d 495 (2005) (exclusion of evidence on relevance grounds reviewed for legal error).

It is helpful to begin by reviewing Oregon law on access to public roads from abutting property. Owners of real property in Oregon have a common-law right of access to public roads that abut their property. The legislature modified that principle for state highways in 1951 with its enactment of ORS 374.405, which denies abutting landowners a right of access to state highways “constructed, relocated or reconstructed after May 12, 1951.” The road at issue in this case is a state highway, but the state does not contend that ORS 374.405 applies to deny defendant a right of access to the highway.

Denying access to a road to a property owner who has a common-law right of access to the road can constitute a taking of that right for which compensation would be owed under Article I, section 18, of the Oregon Constitution. For example, the construction of an irrigation ditch that denied landowners access to a road in Sweet et al. v. Irrigation Canal Co., 198 Or. 166, 191, 254 P.2d 700, reh'g den., 198 Or. 166, 256 P.2d 252 (1953), constituted a taking of the owners' access rights because the ditch involved a use of the right of way of the road for a purpose other than a road purpose. As the court explained, an impairment of an abutting owner's right of access to a highway “caused by the use of the highway for other than legitimate highway purposes is a taking within the meaning of the constitution.” Id. The measure of damages for the loss of access to a road is the diminution in the value of the land resulting from the loss of access.

However, it is well established in Oregon that governmental regulation or modification of a road for road purposes that denies a landowner access to the road does not give rise to a compensable taking of the owner's access right. For example, the court held in Oregon Investment Co. v. Schrunk, 242 Or. 63, 408 P.2d 89 (1965), that Portland's decision to establish a 24–hour bus-loading zone that spanned the entire length of a city block and, as a consequence, that denied abutting landowners any access from their property to the affected street, did not constitute a taking of the owners' access to the street. The court acknowledged that the owners' right of access to the street was a property right but concluded that the right was “subservient to the primary rights of the public to the free use of the streets for the purposes of travel and incidental purposes.” Id. at 69, 408 P.2d 89 (citations omitted). The court went on to explain:

“It is apparent that the concern of the city in refusing to allow a curb cut on SW Fourth Avenue and thereby barring the use of the sidewalk on that street for the passage of automobiles going into and leaving plaintiffs' property, was with the public safety and convenience—with the safety in a heavily congested area of pedestrians, including persons boarding and departing from buses, and the safe and orderly movement of automobile traffic. * * * It may be that some depreciation in the value of plaintiffs' property or some lessening of profits from their parking business has resulted—though neither is alleged. But if so, it is damnum absque injuria. There was no ‘taking’ of plaintiffs' property within the meaning of Article I, section 18, of the Oregon Constitution. As this court said in Brand v. Multnomah County, [38 Or. 79, 92, 60 P. 390, aff'd on reh'g, 38 Or. 79, 62 P. 209 (1900) ] * * *:
‘Acts done in the proper exercise of governmental powers, and not directly encroaching upon private property, though their consequences may impair its use, are universally held not to be a taking within the meaning of the constitutional provision.’

242 Or. at 71, 408 P.2d 89 (citation omitted); see also Barrett et al. v. Union Bridge Co., 117 Or. 220, 223–24, 243 P. 93, reh'g den.,117 Or. 566, 245 P. 308 (1926) (...

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2 cases
  • State v. Alderwoods (Or.), Inc.
    • United States
    • Oregon Supreme Court
    • December 31, 2015
    ...the order granting the state's motion in limine.The Court of Appeals affirmed by an equally divided court. ODOT v. Alderwoods (Oregon), Inc., 265 Or.App. 572, 336 P.3d 1047 (2014). In a concurring opinion in which four judges joined, Judge Armstrong held that the trial court had not erred i......
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    • United States
    • Oregon Court of Appeals
    • December 31, 2014

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