City of Myrtle Beach v. Miss Kitty's, Inc ( 2004 )

THIS OPINION HAS NO PRECEDENTIAL VALUE

THIS OPINION HAS NO PRECEDENTIAL VALUE.  IT SHOULD NOT
BE CITED OR RELIED ON AS PRECEDENT IN ANY PROCEEDING
EXCEPT AS PROVIDED BY RULE 239(d)(2), SCACR.

THE STATE OF SOUTH CAROLINA
In The Court of Appeals

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City of Myrtle Beach, Respondent,

v.

Miss Kitty’s, Inc., Appellant.

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Appeal From Horry County
John L. Breeden, Jr., Circuit Court Judge

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Unpublished Opinion No. 2004-UP-369
Submitted June 8, 2004 – Filed June 10, 2004

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AFFIRMED

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William I. Diggs, of Myrtle Beach, for Appellant.

James B. Van Osdell and Cynthia Graham Howe, both of Myrtle Beach, for Respondent.

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PER CURIAM:  The City of Myrtle Beach (the City) brought this action seeking a declaration that it is not obligated to provide sewer service to Miss Kitty’s, Inc., a business located just outside the City’s corporate limits.  Miss Kitty’s filed a counterclaim alleging the City breached its contract to provide sewer service to the business with the intent to violate Miss Kitty’s freedom of speech and equal protection rights. The circuit court granted summary judgment in favor of the City on all of Miss Kitty’s claims.  Miss Kitty’s appeals, arguing summary judgment was premature because it did not have a chance to finish discovery on the issue of whether the City’s alleged breach of contract violated Miss Kitty’s constitutional free speech and equal protection rights.  We affirm.

FACTS/PROCEDURAL HISTORY

This case arises from several years of litigation concerning the City’s authority over the property upon which Miss Kitty’s is located and the City’s obligation to provide sewer service to the property.  In 1996, the owner of the subject property, David Eliyahu, sought sewer service for the property from the City.  Because Eliyahu’s property was outside the City’s corporate limits, the City required Eliyahu to petition the City for annexation of the property as a condition of the City providing sewer service.  Eliyahu filed the petition and also paid the required sewer impact fee.  Eliyahu later changed his mind, deciding he would rather not have his property annexed.  The City, however, refused to allow Eliyahu to withdraw his annexation petition because it had already connected sewer services to his property.

Eliyahu subsequently brought an action against the City seeking a court order invalidating the ordinance annexing his property. The circuit court issued a temporary injunction ordering the City not to exercise authority over Eliyahu’s property pending a final determination.  The injunction also provided the City did not have to provide municipal services to the property, with the exception of water.

In late 1996, during the pendency of Eliyahu’s suit against the City, Miss Kitty’s became Eliyahu’s tenant on the property. Miss Kitty’s operated as an adult entertainment venue.  The City continued to provide sewer service when Miss Kitty’s opened its business on Eliyahu’s property. [1]

In October 2000, Eliyahu and the City settled the suit after the City agreed with Eliyahu’s demand to repeal the ordinance annexing the property, essentially putting the parties in their pre-annexation positions. This settlement included an understanding that the City would no longer provide sewer service to the property as a result of the annexation being repealed. Sewer service was disconnected on October 17, 2000.  The following day, Miss Kitty’s contacted the City and threatened a lawsuit if sewer services were not restored immediately.  Miss Kitty’s attorney later repeated the threat of a lawsuit.  The City responded by filing the present action seeking a declaratory judgment that it was not required to provide sewer services to Miss Kitty’s or other property not located within the City’s corporate limits.  Miss Kitty’s counterclaimed, asserting causes of action for inverse condemnation and breach of contract with intent to violate Miss Kitty’s right to freedom of speech and equal protection under the United States and South Carolina constitutions.

In June 2001, the City moved to dismiss Miss Kitty’s amended answer and counterclaim pursuant to Rule 12(b)(6), SCRCP, for failure to state facts sufficient to constitute a cause of action.  This motion, however, was neither heard nor ruled upon by the trial court.  Several months later, in November 2001, the City filed a motion for summary judgment.  That motion was heard on March 7, 2002, and the circuit court issued its order granting summary judgment to the City on May 15, 2002.  This appeal follows.

STANDARD OF REVIEW

A trial court should grant a motion for summary judgment when “the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.”  Rule 56(c), SCRCP; see also Fleming v. Rose, 350 S.C. 488, 493, 567 S.E.2d 857, 860 (2002).  “In determining whether any triable issues of fact exist, the evidence and all inferences which can be reasonably drawn from the evidence must be viewed in the light most favorable to the nonmoving party.”  Strother v. Lexington County Recreation Comm’n, 332 S.C. 54, 61, 504 S.E.2d 117, 121 (1998).  If triable issues of fact exist, those issues must go to the jury.  Young v. South Carolina Dep’t of Corr., 333 S.C. 714, 717, 511 S.E.2d 413, 415 (Ct. App. 1999).

DISCUSSION

Miss Kitty’s argues summary judgment was premature because it did not have an opportunity to complete discovery on the issue of whether the City’s alleged breach of contract violated Miss Kitty’s constitutional free speech and equal protection rights.  We disagree.

As an initial matter, we note that the record contains no indication that Miss Kitty’s objected to the circuit court’s consideration of the City’s summary judgment motion on the grounds discovery was incomplete. The only indication that Miss Kitty’s desired to offer additional evidence was its request at the conclusion of the summary judgment hearing that it be allowed to submit additional affidavits after the hearing.  Neither during the five months the motion for summary judgment was pending, nor during the hearing itself, did Miss Kitty’s request a continuance of the hearing or otherwise ask the circuit court to hold consideration of the motion in abeyance to allow for additional discovery.  As a threshold matter, therefore, Miss Kitty’s argument on appeal was not preserved for our review.  See Pryor v. Northwest Apartments, Ltd., 321 S.C. 524, 529, 469 S.E.2d 630, 633 (Ct. App. 1996) (holding issue of whether judge erred in granting summary judgment because discovery requests were outstanding was not preserved when appellant did not ask for a continuance to complete discovery).

Even had Miss Kitty’s properly raised to the court below its argument that further discovery was warranted, we find it was proper for the circuit judge to consider the summary judgment motion.  Under Rule 56 of the South Carolina Rules of Civil Procedure, “[a] party seeking to recover upon a claim, counterclaim, or cross-claim or to obtain a declaratory judgment may, at any time after the expiration of 30 days from the commencement of the action . . . move . . . for a summary judgment in his favor upon all or any part thereof.” Rule 56(a), SCRCP.   Summary judgment, however, is appropriate only after the parties to the action have had a full and fair opportunity to gather relevant facts and develop the record on the issue. Dawkins v. Fields, 354 S.C. 58, 69, 580 S.E.2d 433, 439 (2003); see also Carolina Alliance for Fair Employment v. S.C. Dep’t of Labor, Licensing & Regulation, 337 S.C. 476, 485, 523 S.E.2d 795, 800 (Ct. App. 1999) (holding that summary judgment is mandated “after adequate time for discovery against a party who fails to make a showing sufficient to establish the existence of an element essential to the party’s case and on which that party will bear the burden of proof at trial”).  The decision to reopen the record to allow the proffer of additional evidence at the summary judgment hearing is a matter within the sound discretion of the trial judge.  Bessinger v. Bi-Lo, Inc., 329 S.C. 617, 620, 496 S.E.2d 33, 35 (Ct. App. 1998).

The timeline of events in the litigation of this case reveals Miss Kitty’s had ample opportunity to pursue discovery on all of the issues related to its defenses and counterclaims.  The City’s initial complaint in this case was filed in October 2000.  Two months later Miss Kitty’s moved to amend its answer and counterclaim to include a defense that terminating its sewer services violated its First Amendment rights and a counterclaim for breach of contract with intent to violate its constitutional free speech and equal protection rights.  By consent order, the circuit court granted Miss Kitty’s motion to amend in May 2001, and the City served a timely response in June 2001. As previously noted, the City did not file its summary judgment motion until November 2001, and that motion was not heard until March 2002.  Throughout this time period, Miss Kitty’s largely failed to conduct or participate in discovery. In fact, in June 2001, the City was forced obtain an order from the trial court compelling discovery responses from Miss Kitty’s.  The City was even prompted to move for sanctions when Miss Kitty’s failed to respond as required by the trial court’s order.

Miss Kitty’s, therefore, squandered its opportunity to discover material facts and develop the record in this case.  Beyond the bare assertions contained in the pleadings, there are no facts in the record before us which would indicate the City’s decision to terminate sewer services to the subject property was motivated by a desire to suppress Miss Kitty’s constitutional right to free expression or that the City otherwise handled the sewer service dispute differently than it would have had Miss Kitty’s not been engaged in the adult entertainment business.  Indeed, the City was aware of the nature of Miss Kitty’s business and provided sewer service to the business for several years prior to the settlement with the property owner, Eliyahu. Accordingly, Miss Kitty’s has failed to show that additional discovery would shed evidentiary light on these allegations that have gone unsupported throughout the pendency of this case.  See Dawkins, 354 S.C. at 69, 580 S.E.2d at 439 (holding that “the nonmoving party must demonstrate the likelihood that further discovery will uncover additional relevant evidence and that the party is ‘not merely engaged in a fishing expedition’”) (quoting  Baughman v. Am. Tel. and Tel. Co., 306 S.C. 101, 112, 410 S.E.2d 537, 544 (1991)).

For these reasons, we find the circuit court’s order granting the motion for summary judgment is

AFFIRMED.

ANDERSON, HUFF, and KITTREDGE, JJ., concur.

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[1]        Miss Kitty’s requested additional sewer service for its operation on the subject property for which it paid the City an increased sewer impact fee.