State v. Rantz

• Court: Missouri Court of Appeals
• Writing for the Court: John E. Parrish
• Citation: State v. Rantz, 43 S.W.3d 436 (Mo. App. 2001)
• Decision Date: 04 April 2001
• Parties: (Mo.App. S.D. 2001) State of Missouri, ex rel., Missouri Highway & Transportation Commission, Appellant/Respondent v. Betty Rantz, et al., Respondents/Appellants. 22821 & 23366 0

43 S.W.3d 436 (Mo.App. S.D. 2001)

State of Missouri, ex rel., Missouri Highway & Transportation Commission, Appellant/Respondent v. Betty Rantz, et al., Respondents/Appellants.

22821 & 23366

Missouri Court of Appeals Southern District

04/04/2001

Appeal From: Circuit Court of Stone County, Hon. J. Edward Sweeney

Counsel for Appellant: R.B. Regan, Rich Tiemeyer, Peter M. Donovan

Counsel for Respondent: Richard L. Schnake, Jerry L. Redfern, Brian K. Asberry

Shrum and Montgomery, JJ., concur

John E. Parrish, Presiding Judge

The Missouri Highway and Transportation Commission (MHTC) filed an action in Stone County to condemn certain property for highway construction. The land sought by MHTC included tracts owned by respondents in No. 22821 (referred to in this opinion as "landowners"). Landowners are the appellants in No. 23366. Landowners moved to dismiss the action for lack of subject matter jurisdiction on the basis that MHTC had not joined necessary and indispensable parties to the action. Landowners further asserted that the trial court did not have jurisdiction to proceed for other reasons, including that MHTC failed to negotiate in good faith with all individuals who owned interests in the property it sought.

MHTC filed an amended petition naming the parties who landowners contended were necessary and indispensable parties. The trial court then granted landowners' motion to dismiss on the grounds that MHTC did not negotiate with or make offers to purchase leasehold interests of the defendants who had been added as parties to the litigation. The trial court found there was no just reason for delay in entering judgment dismissing the action. Judgment was entered February 2, 1999. See Rule 74.01(b). MHTC appeals that judgment. That appeal is No. 22821.

Landowners also filed a motion for sanctions seeking payment of their attorney fees by MHTC "as a sanction for needless, wrongful, and vexatious filing and prosecution of the action." The trial court found there was no statutory authority for awarding the attorney fees landowners sought. The trial court further found it could not determine "the wrongfulness of [MHTC's] actions because an appeal of the dismissal is pending" which could result in a determination that the trial court's dismissal of the condemnation action was erroneous. The trial court entered judgment December 8, 1999, denying landowners' motion for sanctions. Landowners appeal that judgment. That appeal is No. 23366.

Nos. 22821 and 23366 were consolidated by this court. No. 22821 is reversed and remanded. No. 23366 is affirmed.No. 22821

The parties MHTC added by means of its amended petition had leasehold interests in tracts MHTC was condemning.¹ The trial court found their interests existed before the condemnation action was commenced; that MHTC was aware of those interests. It concluded that MHTC did not negotiate with or make any offer to purchase the respective tracts owned by those persons; that this was contrary to Section 523.010² and Rule 86.04.

MHTC contends the trial court erred in holding it lacked subject matter jurisdiction and in dismissing the condemnation action. MHTC argues that offers were made to the holders of the fee interests in the tracts of real estate being condemned; that the trial court's finding that offers were required to be made to the holders of lesser interests in the real estate was an erroneous declaration of law. This court agrees.

MHTC has authority to condemn land for highway use and highway construction. See Section 227.120. Missouri statutes governing condemnation proceedings are found in chapter 523. Section 523.010.1 provides that a condemning authority may initiate an action to appropriate land for public use when it and landowners "cannot agree upon the proper compensation to be paid." Rule 86.04 provides that a petition filed in a condemnation action shall contain "a statement either that the condemnor or owner can not agree on the proper compensation to be paid or that an owner is incapable of contracting, is unknown, can not be found or is a non-resident of the state."

State ex rel. State Highway Com'n v. Pinkley, 474 S.W.2d 46 (Mo.App. 1971), explains:

The power of eminent domain is an inherent attribute of sovereignty to be exercised by such agencies, for such public purposes and in such manner as may be provided by law. State ex rel. Lane v. Pankey, 359 Mo. 118, 221 S.W.2d 195 [(banc 1949)]; State ex rel. State Highway Commission v. James, 356 Mo. 1161, 205 S.W.2d 534 [(banc 1947)]; State ex rel. State Highway Commission v. Gordon, 327 Mo. 160, 36 S.W.2d 105 [(banc 1931)]. Section 227.120, RSMo 1969,[³] V.A.M.S., empowers the Commission to condemn land for the purposes stated therein, and paragraph (13) of that section provides that the procedure to be followed shall be in accordance with the provisions of Chapter 523 of our statutes. Section 523.010[⁴] of that chapter "* * * authorizes the filing of condemnation proceedings only in such cases where the condemnor 'and the owners cannot agree upon the proper compensation to be paid.' * * *" State ex rel. State Highway Commission v. Jensen, Mo., 362 S.W.2d 568, 569 [(banc 1962)]. Accordingly, our appellate courts have long and uniformly held that the inability of the condemnor to reach an agreement with the owner on the price to be paid for the land is a jurisdictional fact which must be both pleaded in the condemnor's petition, and proven. State ex rel. State Highway Commission v. Jensen, Mo., supra; Caruthersville School Dist. No. 18 of Pemiscot County v. Latshaw, 360 Mo. 1211, 233 S.W.2d 6 [(1950)]; School Dist. of Clayton v. Kelsey, 355 Mo. 478, 196 S.W.2d 860 [(1946)]. Thus since the case of Lind v. Clemens, 44 Mo. 540, decided in 1869, it has been a firmly settled principle of law that when the authority to condemn is conditioned upon the inability of the condemnor and the owner to agree upon the amount to be paid, and no effort of the condemnor to effect an agreement is shown, the condemnation proceedings cannot be maintained. Leslie v. City of St. Louis, 47 Mo. 474 [(1871)]; City of St. Louis v. Glasgow, 254 Mo. 262, 162 S.W. 596 [(1914)]; State ex rel. State Highway Commission v. Cady, Mo.App., 372 S.W.2d 639 [(1963)], cert. den. 385 U.S. 204, 87 S.Ct. 407, 17 L.Ed.2d 300 [(1966)]. In Cady (l.c. 642) the court said:

"* * * Necessity is the underlying basis for the sovereign's exercise of the power of eminent domain. No such necessity can exist until it be shown that the parties cannot agree in private negotiation. Our landowners should not be haled into court, nor should dockets be burdened with such litigation until it is made to appear affirmatively that negotiations have been attempted and have failed."

Id. at 48-49.

MHTC contends it was not required to negotiate with owners of leasehold interests since it had not been able to negotiate agreements with the respective owners of fee interests in the various tracts involved in the condemnation. MHTC cites M & A Elec. Power Co-op v. Georger, 480 S.W.2d 868 (Mo. 1972), and City of Blue Springs v. Central Devel. Ass'n, 684 S.W.2d 44 (Mo.App. 1984), in support of its position.

M & A Electric involved a power company's effort to obtain a perpetual easement across real estate owned by a husband and wife as tenants by the entirety. An offer was made to the husband that was rejected. No offer was made to the wife. A condemnation action was brought to obtain the easement. The property owners moved to dismiss the action on the grounds that the power company had not negotiated in good faith in attempting to purchase the easement because it had not negotiated with both landowners. The trial court denied the motion. The supreme court held this was not error; that the power company's offer to the husband met the statutory requirement that the landowners and the condemning authority must be shown to be unable to agree upon proper compensation for the land sought in order to proceed with condemnation. The court held:

This evidence was adequate to meet the jurisdictional showing that the condemnor and "the owners cannot agree upon the proper compensation to be paid * * *." Section 523.010 RSMo 1969, V.A.M.S. The fact that the agent did not discuss the offer with [the wife] does not defeat the right of plaintiff to condemn. [The husband] would have been required to join in any grant of easement and his flat refusal to do so made unnecessary the tender of the offer to [the wife].

480 S.W.2d at 870.

In City of Blue Springs a city sought to condemn land for constructing a municipally owned water system. The city intended to sink wells and extract water from the underground water supply on the property it sought. It intended to build a water treatment plant near the wells. Easements were also sought to drain off waste from the treatment plant and to pipe water to the city.

The property the City of Blue Springs sought included a tract owned by Central Development Association (CDA), the real estate holding corporation for the Reorganized Church of Latter Day Saints. Another corporation, Community Water Company (CWC), owned the subsurface water rights to the CDA land. The city negotiated with the owner of the fee interest in the property, CDA, before initiating a condemnation action, but did not negotiate with CWC, the owner of the subsurface water rights. The court held this met the statutory requirement for negotiation with a landowner before initiating condemnation proceedings. It explained:

In State ex rel. Weatherby Advertising Company v. Conley, 527 S.W.2d 334, 336 (Mo. banc 1975), it was held to be a jurisdictional requirement that the condemnor and property owner have been unable to agree on the compensation to be paid for the property being taken. This jurisdictional fact must be both pleaded and proved. Contrary to the trial court's findings, there is substantial evidence to support that Blue Springs accomplished both.

The...