Hurley v. State

HANSON, Judge.'

This is the final chapter, we trust, in protracted proceedings involving damages claimed by an abutting property owner for loss of access to West Boulevard in Rapid City. The action orig-mated against the city. On appeal, Hurley v. City of Rapid City, 80 S.D. 180, 121 N.W.2d 21, it was determined the city was not legally responsible for the damages claimed. Plaintiffs then filed a claim in the amount of $75,000 against the State of South Dakota. The claim was denied and this action commenced under SDC 1960 Supp. 33.0604. The Hon. F. Thomas Parker, one of the judges of the Seventh Judicial Circuit, was appointed Referee. During the reference certain pretrial questions were certified to and determined by this court in Hurley v. State, 81 S.D. 318, 134 N.W.2d 782. The issues were thereafter heard by the Referee, without a jury, and he reports there has been a substantial impairment of plaintiffs' right of access by the construction of a barrier by the State constituting a taking and damaging of plaintiffs' property in the amount of $20,000, together with interest at 6 percent per annum since April 19, 1959. The State excepts to the Referee's Report upon the following grounds: (1) There has been no compensable taking or damaging of plaintiffs' property, and (2) there was not a unity of use between the two lots sufficient to support a consequential damage award as one parcel.

The facts found by the Referee and as disclosed by the evidence show plaintiffs have owned Lots 1 and 2 of Tract A in Lot 25, Block 25 of Riverside Addition in Rapid City since 1954. Lot 1 is situated on the corner of Omaha Street and West Boulevard. Lot 2 adjoins on the west. Before the taking West Boulevard and Omaha were conventional public streets. Plaintiffs had open, free, and unobstructed access to West Boulevard on the east of their lots for a distance of 162 feet and to Omaha street on the south for a distance of 80 feet. West Boulevard was converted from a conventional street into part of Interstate 90. As part of the construction the State Highway Commission on April 19, 1959 erected a steel barrier along the west side of West Boulevard. This steel barrier runs along the entire east side of plaintiffs' lots and extends around the corner on Omaha street for a distance of 10 feet. The barrier precludes all direct access from plaintiffs' property to West Boulevard.

The Referee found before the construction of the barrier and conversion of West Boulevard into part of Interstate 90 the highest, best, and most profitable use of the two lots was for a service station with a fair market value of $30,000. After the construction of the barrier the property was no longer usable as a service station and had a fair market value of $10,000. Therefore, plaintiffs' property was substantially impaired and damaged by the loss of access in the amount of $20,000. The Referee also found the highest, best, and most profitable use of Lots 1 and 2 were as a unit. The lots were vacant and unoccupied.

It is universally recognized that an owner of land abutting on a conventional street or highway has certain private rights in the street or highway distinct from that of the general public. 29A C.J.S. Eminent Domain § 105(1), p. 424 et seq. Right of access is one of these private property rights which cannot be taken for public use or materially impaired without compensation. 29A C.J.S. Eminent Domain § 105(2), p. 429. This has long been the settled law of this state. In the early case of Edmison v. Lowry, 1892, 3 S.D. 77, 52 N.W. 583, 17 L.R.A. 275, the court said: "This right of the abutting owner is a peculiar, distinct, and separate right from that of the general public to use such street as a public highway. It includes, not only the rights of the general public, but the further right to the street for light and air, access, ingress, and egress, at all times, subject only to the easement of the public and the rights of the municipality. This right to an unobstructed street in front of his premises for light and air, access, ingress, and egress, belonging to an abutting owner, constitutes the most valuable part of the property, especially in crowded thoroughfares and on business streets, and without these rights the property, in many instances, would be greatly diminished in value. These rights, therefore, constitute property that cannot be taken for public use, except upon payment of just compensation. See also Hyde v. Minnesota, D. & P. Ry. Co., 29 S.D. 220, 136 N.W. 92, 40 L.R.A.,N.S., 48.

Until the latter part of the last century most states refused to compensate an owner of land which had been damaged by the construction of a public improvement where there was no physical taking of any part of the property on the theory that consequential damages were not recoverable under the "taking" clauses of their eminent domain constitutional clauses. This was recognized as unjust and "in 1870 a constitutional amendment was adopted in Illinois providing that private property should be neither taken NOR DAMAGED for public use without compensation. This action by Illinois was followed by many of the other states * * It is now contained in the constitutions of Alabama, Arizona, Arkansas, California, Colorado, Georgia, Illinois, Kentucky, Louisiana, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Mexico, North Dakota, Oklahoma, Pennsylvania, South Dakota, Texas, Utah, Virginia, Washington, West Virginia, and Wyoming * * It is under the later provision of the constitution protecting an owner against 'damage' that a landowner may claim compensation for the destruction or disturbance of easements of light and air, and of accessibility, or of such other intangible rights as he enjoys in connection with and as incidental to the ownership of the land itself". 2 Nichols on Eminent Domain § 6.44, pp. 486, 487.

This basic rule has long been recognized in South Dakota i. e., even though no part of private property is physically taken the landowner is entitled to compensation under the taking and damaging clause of our constitution (§ 13, Art. VI) when the construction of a public improvement causes damage to property "if the consequential injury is peculiar to the owner's land and not of a kind sufferéd by the public as a whole." State Highway Commission v. Bloom, 77 S.D. 452, 93 N.W.2d 572; Searle v. City of Lead, 10 S.D. 312, 73 N.W. 101, 39 L.R.A. 345; Whittaker v. City of Deadwood, 12 S.D 608, 82 N.W. 202; In Re Yankton-Clay County Drainage Ditch, 38 S.D. 168, 160 N.W. 732.

Specific statutory authority is granted to the state highway department to acquire "private or public property rights for controlled-access facilities and service roads, including rights of access, air, view, and light * * SDC 1960 Supp. 28.09A05.

It is equally well settled, however, that an abutting landowner's right of access is not absolute, but is subject to reasonable regulation and restriction by the state under its police power in the public interest. As expressed in Darnall v. State, 79 S.D. 59, 108 N.W.2d 201 "The construction of a highway past a place of business gives owners no vested right to insist that it remain there as a changeless road in a changing world * * * The right of ingress and egress has been held to be subject to reasonable regulations in the public interest and for the promotion of public convenience and necessity * * * it has been declared to be a reasonable or convenient access and not access at all points along the highway." Under the circumstances, it was concluded by the majority of the court there could be no recovery as there was no physical taking and the owner's access to the highway was not unreasonably diminished or interfered with. Therefore, Darnall's loss due to diversion of traffic was the end result of a lawful exercise of the police power. The State contends the same principle applies and the same conclusion is dictated here. We do not agree.

The three broad inherent powers of governmental sovereignty by which the state carries out its fundamental purpose of protecting the health, safety, morals, and general welfare of the public are the powers of taxation, police, and eminent domain. These are co-existing and may be and often are exercised simultaneously to perform a single governmental function. In such case, it is difficult to determine with exactitude when regulation under the police power ends and a compensable taking of private property begins. The question was answered by the Nebraska Court in Balog v. State, 177 Neb. 826, 131 N.W.2d 402 as follows: "The fact that appellant [State of Nebraska] had under the police power the right to improve its streets and thereby control the traffic thereon does not mean that it had immunity from liability to respond in damages which resulted to private property abutting the improvement where a part of the property of appellee was taken by condemnation. The exercise of police power may or may not involve the taking of private property and it may or may not involve mere noncompensable inconvenience to the owner thereof. The distinction is not whether it is a valid exercise of police power but whether or not the property itself is taken or damaged." Likewise, the Minnesota Court said "While courts have assumed that designating a regulation an exercise of police power prevents compensation by eminent domain proceedings, for practical purposes this is simply a convenient way of describing which activities confer a right to damages and which do not. The prohibiting or limiting of access to a highway may well be an exercise of police power in the sense that it is designed to promote traffic safety, but at the same time it may cause com-pensable injury to an abutting owner. The damage to him must be different in kind and not merely in degree from that experienced by the general public." Hendrickson v. State, 267 Minn. 436, 127 N.W.2d 165.

In each case, therefore, the relative rights of the public and private interests must be considered and the reasonableness of the regulation and the degree of its interference with private property determined. If, after the construction of a public improvement an abutting landowner continues to have reasonable access to his property, he has no compensable complaint. But if the right of access is destroyed or materially impaired, the damages are compensable if the injury sustained is peculiar to the owner's land and not of a kind suffered by the public generally. In other words "police regulations must be reasonable, and the legislature cannot, under the guise of the police power, impose unreasonable or arbitrary regulations which go beyond that power, and in effect deprive a person of his property within the purview of the law of eminent domain, as by depriving the owner of all profitable use of the property not per se injurious or pernicious, restricting the lawful uses to which the property can be put and destroying its value, permanently so restricting the use of the property that it cannot be used for any reasonable purpose, or completely destroying the beneficial interest of the owner." 29A C.J.S. Eminent Domain § 6, p. 182.

In the present case, plaintiffs' property is situated on the corner of two streets in a commercial zone of the City of Rapid City. Before the construction of Interstate 90 free, open, and unobstructed access was available from the property to both Omaha Street on the south and West Boulevard on the east. Its highest, best and most profitable use was for an automobile service station and one of the major considerations contributing to its value for such purpose was the right of access to two streets. Negotiations with major oil companies were in progress when the state erected the steel barrier closing all access to the property from West Boulevard and for a limited distance on Omaha Street. The barrier left access only to the west bound traffic on Omaha Street. Likewise, all pedestrian traffic was closed off from the east and from the south. Consequently, the Referee correctly concluded plaintiffs' right of access was substantially impaired and they suffered a compensable loss. Their damages were different in kind and not merely in degree from that experienced by the general public and their private property right of access was taken in the constitutional sense requiring compensation to be paid therefor.

The measure of damages for the obstruction or substantial impairment of an abutting landowner's right of access to a street or highway is the difference between the market value of the property considered at its highest, best, and most profitable use immediately before and immediately after the destruction or impairment. Boxberger v. State Highway Commission, 126 Colo. 526, 251 P.2d 920. Because plaintiffs acquired Lots 1 and 2 at different times and the property is vacant the State contends the Referee erred in considering his property as a single parcel for the assessment of damages.

When part of one, or one, of several lots or tracts of land is taken by eminent domain the owner is not ordinarily entitled to compensation on the residue unless the lots or tracts were used as a unit for a single purpose. "There is no single rule or principle established for determining the unity of lands for the purpose of awarding damages in eminent domain cases. While, generally, there must be unity of title, contiguity of use, and unity of use, under certain circumstances, the presence of all these unities is not essential." 29A C.J.S. Eminent Domain § 140, p. 591. For example, in State Highway Commission v. Fortune, 77 S.D. 302, 91 N.W.2d 675 and in State Highway Commission v. Bloom, 77 S.D. 452, 93 N.W.2d 572, this court recognized that physically separated tracts of land commonly owned and used could be considered one parcel. "In many cases Hie court can, as a matter of law, determine that lots are distinct or otherwise, but ordinarily it is a practical question to be decided by the jury or other similar tribunal which passes upon matters of fact, which should consider evidence on the use and appearance of the land, its legal divisions and the intent of its owner and conclude whether on the whole the lots are separate or not. In such cases the land itself rather than the map should be looked at, and one part of a parcel is not to be considered separate and independent merely because it was bought at a different time from the rest and is separated from it by an imaginary line." 4 Nichols on Eminent Domain, § 14.31, p. 715.

Plaintiffs have continuously owned Lots 1 and 2 since 1954. There is no physical barrier, line fence, street, alley, or intervening land between them. They are separate only on plats. Lot 1 is 40 feet wide and 162 feet long. Lot 2 is 40 feet wide at its junction with Lot 1 on Omaha Street, but it extends only 125 feet north and fans out to a width of 63.9 feet across its northern boundary. Because of its location, irregular shape, and size the two lots in conjunction were particularly adaptable and valuable as an automobile service station. The owners held the property for this singular purpose and were negotiating with major oil companies for a favorable sale or lease of the premises. Access to West Boulevard was a major consideration contributing to their value. Without such access the value of the lots was necessarily and permanently reduced. Their use for any purpose was materially diminished. Under the circumstances, the Referee properly considered Lots 1 and 2 as a single parcel or unit for the assessment of damages.

As the damages constitute compensation for the taking of private property by the state for highway right-of-way, there exists an appropriation for payment. Darnall v. State, 79 S.D. 59, 108 N.W.2d 201. We, therefore, confirm and adopt the Report of the Referee and order entry of judgment in favor of plaintiffs against the State of South Dakota for the sum of $20,000 together with interest thereon at the rate of 6 percent per annum from the 19th day of April, 1959.

Although the issues directly involved have been disposed of we feel compelled, in the public interest, to consider the adequacy of the remedy now afforded a landowner whose property has been taken or damaged without just compensation. An allied question is whether or not § 13, Art. VI of the South /Dakota Constitution is self-executing. Before its amendment by the people in 1962, § 13, Art. VI provided "Private property shall not be taken for public use, or damaged, without just compensation as determined by a jury, which shall be paid as soon as it can be ascertained, and before possession is taken * * As amended, it now provides "Private property shall not be taken for public use, or damaged, without just compensation, which will be determined according to legal procedure established by the Legislature and according to Section 6 of this Article. * * *" Ch. 297, Laws of 1961. Trial by jury in condemnation cases is still guaranteed in the amendment by reference to § 6 of Art. VI which assures "the right of trial by jury shall remain inviolate and shall extend to all cases at law without regard to the amount in controversy * *

The legislature has adequately provided remedies and procedures in condemnation actions which are available to a con-demnor. See SDC 1960 Supp. 28.13A, 37.40, and Ch. 195, Laws of 1963.' However, no specific remedy is afforded a person whose land has been taken or damaged by the condemning authority without compensation. In other words, he has a basic constitutional right, but no remedy for its enforcement.

This question was considered in Darnall v. State, 79 S.D. 59, 108 N.W.2d 201, which involved an inverse condemnation action by private landowners against the state. The action originated in circuit court, however this court assumed jurisdiction under the provisions of SDC 1960 Supp. 33.0604. The majority of the court concluded the legislature had provided an adequate remedy by 33.0604 consequently the question of whether or not § 13, Art. VI of South Dakota Constitution was self-executing and the question of whether or not plaintiffs had a common law action in circuit court for the redress of their alleged damages was not decided.

SDC 1960 Supp. 33.0604 provides:

"It shall be competent for any person deeming himself aggrieved by the refusal of the State Auditor to allow any just claim against the state, to commence an action against the state by filing with the Clerk of the Supreme Court in accordance with the foregoing sections a complaint setting forth fully and particularly the nature of the claim. He shall at the same time file an undertaking in the penal sum of five hundred dollars, with two or more sureties, to be approved by the State Treasurer, to the effect that he will indemnify the state against all costs that may accrue in such action, and pay to the Clerk of said Court all costs in case he shall fail to prosecute his action, or to obtain a judgment against the state; and thereupon the action shall be placed upon the calendar of said Court.

"The plaintiff, within ten days after having filed such complaint and undertaking, shall serve a copy of the complaint upon the Attorney General and the State Auditor, together with a notice to plead or answer thereto within thirty days after the service of such complaint and notice, exclusive of the day of service;' and the Attorney General shall thereupon be required to answer or plead within the time specified in such notice.

"The trial of such action shall be conducted in accordance with the foregoing sections and any special rule or order made for trial of the particular case by the Supreme Court.

"No execution shall issue against the state on any judgment, but whenever final judgment against the state shall have been obtained in any such action the Clerk of the Supreme Court shall make and furnish to the State Auditor a duly certified transcript of such judgment, and the Auditor shall thereupon audit the amount of damages and costs therein awarded, and the same shall be paid out of the State Treasury."

Since Darnall several inverse condemnation actions against the state have been brought in this court under the permissive provisions of the above statute. This experience clearly demonstrates such procedure does not afford an adequate remedy for persons whose private lands have been taken or damaged by the state without compensation for the following reasons:

1. A $500 bond is required to assert a constitutional right;

2. A jury trial is a matter of grace rather than a right guaranted by § 13, Art. VI and § 6, Art VI of our constitution;

3. Necessary or indispensable parties defendant cannot be joined;

4. As a condition precedent there must be a specific appropriation to pay the claim presented;

5. All questions of fact must be referred to a referee;

6. The procedure is complex, limited, delaying in nature and contrary to the spirit of § 20, Art. VI of our Constitution which assures all persons that “All courts shall be open, and every man for an injury done him in his property, person or reputation, shall have remedy by due course of law, and right and justice, administered without denial or delay";

7. Because it is restrictive and qualified it does not afford a proper, satisfactory, or complete remedy;

8. The Supreme Court is not a proper forum for the determination of fact issues.

In the absence of an adequate remedy which can be invoked by condemnees whose private property has been taken or damaged by the state without compensation § 13, Art. VI of our Constitution is deemed to be self-executing. In such cases the aggrieved landowner has a common law action in circuit court where his constitutional right to trial by jury may be asserted. This conclusion was forecast in Searle v. City of Lead, 10 S.D. 312, 73 N.W. 101, 39 L.R.A. 345, wherein this court observed that "The provisions of the constitution are not limited to a change of grade once established, but are general, and include all damages to private property for public use. The legislature is not authorized to restrict the language or take from the citizen the protection the constitution has thrown around him and his property. This provision of the constitution is self-executing, and, if there was no law to carry it into effect, a court of equity would, in the exercise of its inherent power, provide some method for ascertaining the damages, if any, caused by the injury threatened." This is in accord with the great weight of authority according to the following summary appearing in 16 C.J.S. Const.Law § 49, p. 149: "While there is some authority that such a provision is not self-executing, it is generally held that a constitutional prohibition against taking or damaging private property for public use without just compensation therefor is self-executing, even though the method of ascertaining such compensation is left for legislative determination. It requires no legislation for its enforcement and confers the right to obtain compensation regardless of statutory provision therefor. Neither consent to sue the state nor the creation of a remedy by legislative enactment is necessary to obtain relief for a violation of the constitutional provision. A constitutional provision that suits may be brought against the state in such manner and in such courts as shall be directed by law does not require the enactment of a statute before suit may be brought to enforce the constitutional provision against the taking or damaging of property for public use without compensation. When the constitution forbids taking of, or damage to, private property, and points out no remedy and no statute affords one for the invasion of the right of property thus secured, the common law, which provides a remedy for every wrong, will furnish the appropriate action for the redress of such grievance."

Therefore, by this caveat we overrule contrary conclusions concerning the adequacy of the remedy afforded by SDC I960 Supp. 33.0604 for landowners whose property is alleged to have been taken or damaged by the state without just compensation. Great Northern Ry. Co. v. Sunburst Oil & Refining Co., 287 U.S. 358, 53 S.Ct. 145, 77 L.Ed. 360. In the absence of an adequate remedy provided by the legislature which condemnees may invoke in such cases, Section 13, Article VI of our Constitution is deemed to be self-executing granting them a right of trial by jury in the circuit courts of our state.

RENTTO, P. J., and HOMEYER, J., concur. BIEGELMEIER, J., concurs in part and dissents in part. ROBERTS, J., dissents.