MDU v. Behm

20200122
FILED
IN THE OFFICE OF THE
CLERK OF SUPREME COURT
NOVEMBER 19, 2020
STATE OF NORTH DAKOTA
IN THE SUPREME COURT
STATE OF NORTH DAKOTA
2020 ND 234
Montana-Dakota Utilities Co., a Division of
MDU Resources Group, Inc., n/k/a Montana-
Dakota Utilities Co., a Subsidiary of MDU
Resources Group, Inc., Plaintiff and Appellee
v.
Lavern Behm, Defendant and Appellant
No. 20200122
Appeal from the District Court of Ward County, North Central Judicial
District, the Honorable Gary H. Lee, Judge.
AFFIRMED.
Opinion of the Court by Tufte, Justice.
Zachary R. Eiken, Bismarck, N.D., for plaintiff and appellee.
Lynn M. Boughey, Mandan, N.D., for defendant and appellant.
MDU v. Behm
No. 20200122
Tufte, Justice.
[¶1] Lavern Behm appeals from a judgment ordering Montana-Dakota
Utilities Co. (“MDU”) to pay him $17,443 in attorney’s fees and costs incurred
in an eminent domain action. Behm argues his constitutional rights were
violated in the eminent domain action and the district court erred by failing to
award him some of the attorney’s fees he requested. We affirm.
I
[¶2] MDU brought an eminent domain action under N.D.C.C. ch. 32-15 to
acquire an easement across Behm’s property for a 3,000-foot natural gas
pipeline to service a Burlington Northern Santa Fe railroad switch. The
district court bifurcated the proceedings between necessity of the taking and
damages. Following a bench trial, the district court concluded that the
“proposed pipeline is . . . a use authorized by Section 32-15-02, NDCC,” but
that a taking of Behm’s property was not necessary for the public use under
N.D.C.C. § 32-15-05.
[¶3] MDU appealed, and this Court reversed the district court’s decision that
the proposed taking was not necessary for public use. Montana-Dakota Utils.
Co. v. Behm, 2019 ND 139, ¶ 1, 927 N.W.2d 865. We remanded “for trial on
eminent domain damages to be awarded to Behm.” Id. at ¶ 19.
[¶4] Behm petitioned the United States Supreme Court for a writ of certiorari
asserting various constitutional violations related to the eminent domain
action. His petition was denied. Behm v. Montana-Dakota Utils. Co., 140 S. Ct.
521 (2019).
[¶5] On remand, Behm submitted proposed jury instructions and requested
the court allow the jury to determine in an advisory capacity whether the
taking was necessary and for a public use. The district court denied Behm’s
request for the jury instructions, ruling the issue of damages was the only issue
left to be decided.
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[¶6] The parties stipulated to the valuation of the easement, and the district
court adopted the stipulation. Behm moved for attorney’s fees and costs in the
amount of $49,561.78, including the fees incurred for the petition for writ of
certiorari to the United States Supreme Court. MDU objected to the requested
fees. The district court ordered MDU to pay Behm $17,443 in fees and costs.
II
[¶7] Behm makes various arguments about the constitutionality of the
eminent domain proceedings. He claims it is a violation of due process and the
takings clause for the State to allow a private corporation to take property
through eminent domain, for the State to disregard a finding that the taking
is not necessary and allow the corporation to take the property on the
corporation’s finding the taking is necessary, and for the State to disregard
findings of no public use and allow the corporation to take the property on its
determination of a public use. He contends it is a violation of due process, the
takings clause, and the right to a jury to allow a taking without a jury
determination that the taking is for a public use and that the taking is
necessary.
[¶8] The law of the case doctrine and the mandate rule apply to Behm’s
arguments. This Court has explained:
Generally, the law of the case is defined as the principle that
if an appellate court has passed on a legal question and remanded
the cause to the court below for further proceedings, the legal
question thus determined by the appellate court will not be
differently determined on a subsequent appeal in the same case
where the facts remain the same. In other words, [t]he law of the
case doctrine applies when an appellate court has decided a legal
question and remanded to the district court for further
proceedings, and [a] party cannot on a second appeal relitigate
issues which were resolved by the Court in the first appeal or
which would have been resolved had they been properly presented
in the first appeal. The mandate rule, a more specific application
of law of the case, requires the trial court to follow pronouncements
of an appellate court on legal issues in subsequent proceedings of
the case and to carry the appellate court’s mandate into effect
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according to its terms. . . . and we retain the authority to decide
whether the district court scrupulously and fully carried out our
mandate’s terms.
Dale Expl., LLC v. Hiepler, 2020 ND 140, ¶ 13, 945 N.W.2d 306 (quoting
Johnston Land Co., LLC v. Sorenson, 2019 ND 165, ¶ 11, 930 N.W.2d 90).
[¶9] Behm submitted proposed jury instructions to the district court,
requesting the court allow a jury to sit in an advisory capacity and determine
whether the taking of his property was necessary and for a public use. He
explained that allowing those issues to be presented to the jury would allow a
complete record on appeal for the purpose of attempting to change state law.
The district court denied Behm’s request for the proposed jury instructions.
The court explained that the issue of the necessity of the taking and whether
the taking was for a public use were previously tried and appealed and that
the decision was reversed on appeal and the case was remanded for a trial on
damages. The court concluded it must adhere to the mandate rule on remand,
this Court’s mandate was clear, and the only matter left for determination was
the issue of eminent domain damages to be awarded to Behm.
[¶10] In the prior appeal, we held the district court correctly concluded the
proposed pipeline was for a public use, but the court erred in ruling the
proposed taking was not necessary for a public use. Behm, 2019 ND 139, ¶¶ 10,
18. We reversed the judgment and “remand[ed] for trial on eminent domain
damages to be awarded to Behm.” Id. at ¶ 19. We did not remand for a new
trial on the issues of necessity and public use or for new arguments to be raised
about the prior proceedings. The district court fully carried out our mandate’s
terms.
[¶11] Furthermore, Behm’s arguments about the constitutionality of the
eminent domain proceedings and whether a jury should have determined
certain issues could have been raised in the district court before the prior
appeal and to this Court in the first appeal. In the prior appeal, this Court
acknowledged, “Behm lists ten issues in his cross-appeal but does not
specifically address any of them in his brief. We do not address inadequately
briefed issues.” Behm, 2019 ND 139, ¶ 19. These ten issues that we declined to
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review included, “Whether the district court erred in not finding a violation of
federal and state constitutional rights by the proposed taking.” The
constitutional arguments he makes in the current appeal could have been
resolved in the first appeal had they been properly presented, and therefore
they are barred by the law of the case doctrine.
[¶12] We conclude Behm’s constitutional arguments are precluded under the
law of the case doctrine and the mandate rule.
III
[¶13] Behm argues the district court abused its discretion by failing to award
him attorney’s fees and costs related to his petition for writ of certiorari.
[¶14] We review the district court’s decision on costs and attorney’s fees in an
eminent domain action for an abuse of discretion. Lincoln Land Dev., LLP v.
City of Lincoln, 2019 ND 81, ¶ 20, 924 N.W.2d 426. A court abuses its discretion
if it acts in an arbitrary, unreasonable, or unconscionable manner, if its
decision is not the product of a rational mental process leading to a reasoned
determination, or if it misinterprets or misapplies the law. Id.
[¶15] Section 32-15-32, N.D.C.C., provides for costs and attorney’s fees in an
eminent domain case, stating:
The court may in its discretion award to the defendant reasonable
actual or statutory costs or both, which may include . . . costs on
appeal, and reasonable attorney’s fees for all judicial proceedings.
If the defendant appeals and does not prevail, the costs on appeal
may be taxed against the defendant. In all cases when a new trial
has been granted upon the application of the defendant and the
defendant has failed upon such trial to obtain greater
compensation than was allowed the defendant upon the first trial,
the costs of such new trial shall be taxed against the defendant.
This Court has said the statute authorizes the district court to award
reasonable attorney’s fees for all judicial proceedings in an eminent domain
action. Lincoln Land, 2019 ND 81, ¶ 22. We explained courts should consider
a number of factors in deciding whether to award fees and costs in an eminent
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domain case, including the number of hours spent, the rate per hour, the
character of the services rendered, the results obtained, the customary fee
charged in the locality, and the ability and skill of the attorney. Cass Cty. Joint
Water Res. Dist. v. Erickson, 2018 ND 228, ¶ 29, 918 N.W.2d 371; see also City
of Bismarck v. Thom, 261 N.W.2d 640, 646 (N.D. 1977). We have also said, “[I]t
is essential that the prevailing party, and the court, if need be, exclude any
hours that are excessive, redundant, or otherwise unnecessary.” N.D. Dep’t of
Transp. v. Rosie Glow, LLC, 2018 ND 123, ¶ 11, 911 N.W.2d 334.
[¶16] Behm requested $49,561.78 in attorney’s fees and costs for fees related
to the prior appeal, the petition for writ of certiorari to the United States
Supreme Court, and to resolve the issue of damages. The district court
previously awarded Behm $22,150 in attorney’s fees and costs before the prior
appeal, and the court found MDU tendered payment for all fees associated with
the initial phase of the trial. The court awarded Behm $17,443 of the
$49,561.78 total request, including the fees and costs incurred for the prior
appeal and subsequent proceedings in the district court. The court denied the
attorney’s fees requested for contacts with individuals who were strangers to
the proceedings and for communications between Behm’s attorney and office
staff about billing matters and other financial matters. The court also denied
any fees related to the petition for writ of certiorari. The court concluded
N.D.C.C. § 32-15-32 allows for fees for all judicial proceedings, but that term
does not include “a side trip” to a federal court, and the statute limits the
recovery of attorney’s fees to legal services related directly to the condemnation
proceeding alone. The court explained the petition to the United States
Supreme Court was “an improvident act,” N.D.C.C. § 32-15-32 does not
contemplate a recovery for all fees incurred for any proceeding not directly
contemplated by the chapter, and therefore the fees would not be allowed.
[¶17] Section 32-15-32, N.D.C.C., gives the district court discretion to award
“reasonable actual or statutory costs” and “reasonable attorney’s fees for
all judicial proceedings.” We have limited recovery of attorney’s fees to
litigation of claims asserting condemnation or inverse condemnation. United
Power Ass’n v. Moxness, 267 N.W.2d 814, 817 (N.D. 1978) (reversing fee award
for proceedings before the public service commission); Arneson v. City of
5
Fargo, 331 N.W.2d 30, 39 (N.D. 1983) (affirming fee award limited to inverse
condemnation and excluding litigation of negligence issues); Gissel v. Kenmare
Twp., 512 N.W.2d 470, 478 (N.D. 1994) (affirming as reasonable the district
court’s reduction of requested attorney’s fees due to “overextended conferences
and an improvident appeal”). Although the court explained its reasoning that
the petition was an “improvident” “side trip” and therefore unreasonable to
that extent, it further stated that Behm’s “petition to the United States
Supreme Court is not a proceeding contemplated in Chapter 32-15.” If
otherwise reasonable, the district court may award attorney’s fees for “all
judicial proceedings,” including a petition for certiorari to the United States
Supreme Court asserting takings claims under the United States Constitution.
N.D.C.C. § 32-15-32. We will not set aside a correct result merely because part
of the reasoning supporting that result was incorrect. Schmidt v. City of Minot,
2016 ND 175, ¶ 16, 883 N.W.2d 909. We conclude the district court did not
abuse its discretion by denying as unreasonable the attorney’s fees and costs
Behm requested related to the petition for writ of certiorari.
IV
[¶18] MDU requests an award of costs and fees on appeal under N.D.R.App.P.
38 for defending against the constitutional issues raised in the appeal. MDU
contends Behm failed to properly raise the constitutional issues in the prior
appeal, he did not adequately brief the issues in this appeal, he did not address
current case law on these issues, and he wasted the Court’s and MDU’s
resources with his unsupported arguments. In the previous appeal, we held
that the district court erred in concluding the proposed taking was not
necessary for a public use, and remanded for trial on eminent domain damages.
Montana-Dakota Utils. Co. v. Behm, 2019 ND 139, ¶¶ 18-19, 927 N.W.2d 865.
[¶19] Rule 38, N.D.R.App.P., provides, “If the court determines that an appeal
is frivolous, or that any party has been dilatory in prosecuting the appeal, it
may award just damages and single or double costs, including reasonable
attorney’s fees.” An appeal is frivolous “if it is flagrantly groundless, devoid of
merit, or demonstrates persistence in the course of litigation which could be
seen as evidence of bad faith.” Frontier Fiscal Servs., LLC v. Pinky’s
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Aggregates, Inc., 2019 ND 147, ¶ 21, 928 N.W.2d 449 (quoting Witzke v. City of
Bismarck, 2006 ND 160, ¶ 19, 718 N.W.2d 586). Behm’s appeal of issues we
decided in the first appeal and beyond the scope of the remand for trial on
damages meets this standard.
[¶20] We award MDU single costs and attorney’s fees in the amount of $500.
V
[¶21] We affirm the judgment.
[¶22] Jon J. Jensen, C.J.
Daniel J. Crothers
Jerod E. Tufte
Allan L. Schmalenberger, S.J.
David Nelson, S.J.
[¶23] The Honorable Allan L. Schmalenberger and the Honorable David
Nelson, Surrogate Judges, sitting in place of VandeWalle, J., and McEvers, J.,
disqualified.
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