Town of Sullivan's Island v. Felger, 2342

• Decision Date: 08 March 1995
• Docket Number: No. 2342,2342
• Court: South Carolina Court of Appeals
• Parties: TOWN OF SULLIVAN'S ISLAND and State of South Carolina, Respondents, v. Milton R. FELGER, Appellant. . Heard

Page 626

457 S.E.2d 626

TOWN OF SULLIVAN'S ISLAND and State of South Carolina, Respondents, v. Milton R. FELGER, Appellant.

No. 2342.

Court of Appeals of South Carolina.

Heard March 8, 1995.

Decided May 1, 1995.

Rehearing Denied Aug. 3, 1995.

Certiorari Denied May 10, 1996.

Gerald M. Finkel and Gilbert Scott Bagnell, both of Finkel, Goldberg, Sheftman & Altman, Columbia, for appellant.

Atty. Gen. T. Travis Medlock and Sr. Asst. Atty. Gen. Kenneth P. Woodington, Columbia, and Lawrence A. Dodds, Jr., Mt. Pleasant, for respondents.

CURETON, Judge:

The Town of Sullivan's Island and the State of South Carolina commenced this declaratory judgment action against Milton Felger seeking a judicial determination that Felger's interest in certain marshlands located on Sullivan's Island is limited to the right to plant and harvest oysters. They also asked the court to rule that this interest applies only to intertidal lands, that is, land below the mean high water mark and above the mean low water mark of an adjoining body of water called Conch Creek. Felger asserted fee simple ownership of the marshlands as well as to adjacent highlands. He further asserted that the boundaries of the tract in question had been established in litigation commenced in 1982 between Felger and the State of South Carolina. The master sustained the State's and the Town's position. Felger appeals. We affirm.

This appeal concerns approximately 90 acres of real property located on the northern side of Sullivan's Island. The property is bordered on the north, west, and east by Conch Creek. These boundaries are not in dispute. The subject of this action is the southern boundary of the property. In his brief, Felger delineates the positions of the parties as follows:

Simplifying the positions of the parties, it would be fair to state that Felger asserts that the grant of all "marsh" depicted in the 1843 plat included wetlands that are not tidelands (that is property between the mean high and high high marks), and that the grant of marshlands above the mean high tide line created a fixed boundary. In contrast, Respondents seek to equate the "marsh" with tidelands, and place its southern boundary along the ever changing mean high tide line.

Felger's interest in the subject property emanates from an 1843 Joint Resolution of the South Carolina General Assembly. Pursuant to the 1843 Resolution, the General Assembly granted David Truesdell an interest in marshlands abutting the eastern end of Sullivan's Island. The resolution provides, in pertinent part:

Resolved, that the exclusive use of the portion of marsh included in the plat accompanying this petition, be granted to David Truesdell, to use the same as a place for planting oysters during the pleasure of the Legislature, and he shall be entitled to possess the oysters so planted as his private property: Provided, that the same not be enclosed or embanked, so as to prevent the free and natural flow of the salt water, over the same, and that it remain in its natural state and be in no way altered therefrom, but by the authority of the Town Council of Moutrieville from time to time, and be at all times subject to the authority of the same.... And provided, further, that it shall be lawful for the public at all times to have free access, to the same, and to pass over the same as hitherto.

Felger acquired an interest in the property in 1980 from Sadie Stender who, along with her two sisters, were the testamentary beneficiaries of Mary Magwood. According to Felger, Mary Magwood died seized and possessed of the subject property.

In 1982, Felger instituted a declaratory judgment action ("the 1982 litigation") against the State of South Carolina seeking, among other things, (1) a judicial determination of any claims to the property adverse to Felger's; (2) judicial declaration that Felger had a leasehold estate of no less than an undivided one-third interest in the property, (3) an order enjoining the State from leasing the property and (4) an order requiring the State to account for all revenues derived from any such leasing. The State denied Felger's claim to an undivided one-third interest in the property and claimed the "lease" had been cancelled. By order dated March 2, 1985, the court found Felger and Sadie Stender's two sisters "own" the property to the low water mark of Conch Creek.

I.

On appeal, Felger argues the instant litigation is barred by res judicata as to the State and by collateral estoppel as to the Town. We disagree.

The doctrine of res judicata is founded on the principle that the public interest requires an end to litigation and that no one should be twice sued for the same cause of action. Winthrop v. Mullins, 211 S.C. 351, 45 S.E.2d 332 (1947); Hayes v. Hayes, --- S.C. ----, 439 S.E.2d 305 (Ct.App.1993). Under the doctrine of res judicata, a final judgment on the merits in a prior action will preclude the parties and their privies from re-litigating any issues actually litigated or those that might have been litigated in the first action. Griggs v. Griggs 214 S.C. 177, 51 S.E.2d 622 (1949); Foran v. USAA Casualty Ins. Co., 311 S.C. 189, 427 S.E.2d 918 (Ct.App.1993). The doctrine requires three essential elements: (1) the judgment must be final, valid and on the merits; (2) the parties in the subsequent action must be identical to those in the first; and (3) the second action must involve matter properly included in the first action. Id.; Owenby v. Owens Corning Fiberglas, --- S.C. ----, 437 S.E.2d 130 (Ct.App.1993).

The doctrine of collateral estoppel, or issue preclusion, on the other hand, rests generally on equitable principles. Watson v. Goldsmith, 205 S.C. 215, 31 S.E.2d 317 (1944). In order to successfully assert collateral estoppel, the party seeking issue preclusion must show that the issue was actually litigated and directly determined in the prior action, and that the matter or fact directly in issue was necessary to support the first judgment. Richburg v. Baughman, 290 S.C. 431, 351 S.E.2d 164 (1986); Beall v. Doe, 281 S.C. 363, 371, 315 S.E.2d 186, 191 (Ct.App.1984).

Here, neither res judicata nor collateral estoppel is applicable to the southern boundary dispute because the 1982 litigation was limited to establishing the northern boundary of subject property, that is, the litigation determined the property is bounded on the north by the low water mark of Conch Creek. At the hearing of the 1982 case, counsel for Felger asserted:

[I]t is [Felger's] contention that the issue in this case is whether or not the state by the lease ... of 1843 ... intended to convey down to the low water mark or not. And that the evidence that [Felger] will show in this is that, one, all of the land subject to the two conveyances was under the high water mark.

Nothing in the 1982 litigation placed in issue the southern boundary of the tract. Nothing in Felger's arguments made during the 1982 litigation indicated Felger claimed an interest in the highland strip now at issue or that there was any dispute as to the southern boundary of the property. In fact, Felger's counsel specifically stated "this [1982] lawsuit is limited to the issue with the state as to the tidelands." (Emphasis ours). Tidelands by definition do not include highlands. See State v. Fain, 273 S.C. 748, 259 S.E.2d 606 (1979); State v. Yelsen Land Co., 265 S.C. 78, 216 S.E.2d 876 (1975); State v. Hardee, 259 S.C. 535, 193 S.E.2d 497 (1972). Even the trial court in the 1982 litigation stated in its order "[t]he issue presently before this court is whether [the 1843 joint resolution] conveyed property down to the low water mark." Thus, the southern boundary of the subject property was not actually at issue in the first litigation and, accordingly, the boundary issue in the 1982 litigation is not res judicata as to the issues in the instant case, nor does collateral estoppel operate to bar the instant boundary dispute.

Further analysis of the contentions of the parties to the 1982 proceeding also demonstrates the contrariety of Felger's position. In that proceeding Felger contended, and the court found, that all of the land in question was covered by water at high tide and thus was intended to be conveyed as marshlands by the 1843 resolution. In so finding, the court rejected the State's position, which appears to be Felger's position in this appeal, that there is a strip of land between the mean high water mark and the high water mark that was considered high marshlands and conveyed in the 1843 grant. ¹

II.

Next, Felger argues the master erred in failing to find the Town lacks standing to bring this action because the Town has no claim to the property even if Felger has no interest. We disagree.

SCRCP 17(a) provides that in order to have standing to sue, a plaintiff must be a real party in interest. "A real party in interest is one who has a real, material, or substantial interest in the subject matter of the litigation, as opposed to one who has only a nominal or technical interest in the action." Anchor Point, Inc., v. Shoals Sewer Co., 308 S.C. 422, 418 S.E.2d 546 (1992). We hold the Town has a real, material or substantial interest in this case. Section 1 of Act No. 420 of 1953 vests authority in the Town, as agent for the State, to execute fee simple deeds to lots on Sullivan's Island that qualify for conversion under the Act. Such authority necessarily involves decisions as to who should get title to lots, whether the lots qualify for conversion and the location and dimension of lots. Also, as noted above, the marsh interest pursuant to the 1843 grant was at all times subject to the authority of the Town Council. In light of the Act's broad legislative grant of power, and the Town's obvious interest in the disposition of the subject property, we hold the Town has standing to participate in this suit.

III.

Felger also argues the master erred in failing to find he is entitled to fee simple title to the...