Cardiff Wales v. Washington County School District

2022 UT 19IN THE
SUPREME COURT OF THE STATE OF UTAH
CARDIFF WALES, LLC,
Petitioner,
v.
WASHINGTON COUNTY SCHOOL DISTRICT,
Respondent.
No. 20210221
Heard February 7, 2022
Filed May 26, 2022
On Certiorari to the Utah Court of Appeals
Fifth District, Washington County
The Honorable G. Michael Westfall
No. 190500076
Attorneys:
Justin P. Matkin, Robert A. McConnell, Jeffery A. Balls,
Salt Lake City, for petitioner
Russell S. Mitchell, St. George, for respondent
JUSTICE PEARCE authored the opinion of the Court in which
CHIEF JUSTICE DURRANT, JUSTICE PETERSEN, JUDGE BROWN,
and JUDGE HOWELL joined.
Having recused himself, ASSOCIATE CHIEF JUSTICE LEE does not
participate herein; DISTRICT COURT JUDGE JENNIFER A BROWN sat.
Due to his retirement, JUSTICE HIMONAS did not participate
herein; DISTRICT COURT JUDGE ANTHONY L. HOWELL sat.
JUSTICE DIANA HAGEN became a member of the Court on May 18,
2022, after oral argument in the matter and accordingly did not
participate.
JUSTICE PEARCE, opinion of the Court:
CARDIFF WALES v. WASHINGTON COUNTY SCHOOL DISTRICT
Opinion of the Court
INTRODUCTION
¶1 Cardiff Wales, LLC claims that it sold a parcel of land to
Washington County School District to avoid an eminent domain
lawsuit the School District had threatened to pursue if Cardiff Wales
did not agree to the sale. Several years after the sale, the School
District decided it did not need the land and sold it to a third party.
Cardiff Wales, who did not learn of the resale until after the sale had
closed, protested and claimed that the School District had failed to
offer it the right of first refusal to repurchase its former property.
Utah law requires a government entity to offer property acquired
through condemnation or a threat of condemnation to the original
owner before disposing of it.
¶2 Cardiff Wales filed suit against the School District arguing
that the School District acquired its property under a “threat of
condemnation.” Utah law provides that a threat of condemnation
occurs when “an official body of the state or a subdivision of the
state, having the power of eminent domain, has specifically
authorized the use of eminent domain to acquire the real property.”
UTAH CODE § 78-34-20(1)(b) (2007), replaced by UTAH CODE § 78B-6-
521(1)(a)(ii) (2022). The district court concluded that Cardiff Wales
never experienced a threat of condemnation and dismissed the suit
for failure to state a claim. Cardiff Wales appealed.
¶3 The court of appeals affirmed, concluding that a government
entity does not “specifically authorize” the use of eminent domain
until it approves an eminent domain lawsuit in an open meeting.
Cardiff Wales LLC v. Wash. Cnty. Sch. Dist., 2021 UT App 21, ¶¶ 12–13,
438 P.3d 1262. We agree with the court of appeals that property is
not taken under a threat of eminent domain until a government
entity specifically authorizes the taking. But the statute does not
support the court of appeals’ narrow interpretation of what it means
to be specifically authorized. We reverse and remand.
BACKGROUND
¶4 Cardiff Wales owned a piece of property in Washington City
(City) that it wanted to develop. 1 Cardiff Wales began working with
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1 This appeal comes to us from a motion to dismiss. “A Rule
12(b)(6) motion to dismiss admits the facts alleged in the complaint
but challenges the plaintiff’s right to relief based on those facts.”
Oakwood Vill. LLC v. Albertsons, Inc., 2004 UT 101, ¶ 8, 104 P.3d 1226(continued . . .)
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the City to obtain the permits it needed to get its development
underway. During this process, the City informed Cardiff Wales that
the School District might be interested in constructing a new high
school on the property. Cardiff Wales reached out to the School
District, which confirmed its desire to purchase the land or take it
through condemnation if necessary.
¶5 Cardiff Wales elected to negotiate with the School District. But
throughout the negotiation process, the School District reminded
Cardiff Wales that if voluntary negotiation was not successful, a
condemnation action was “imminent.” Cardiff Wales ultimately
agreed to sell the property to the School District to avoid losing the
parcel through eminent domain.
¶6 As part of the transaction’s closing, the School District sent
Cardiff Wales a letter. It stated:
This letter is to serve as written confirmation that
earlier this year the Washington County School District
informed you that it wished to acquire property from
Cardiff Wales, LLC, for the construction of two schools.
The District informed you, in accordance with Utah
State law, that if agreeable terms could not be reached
with Cardiff Wales, LLC for the purchase of the
property, the District would be forced to use eminent
domain powers to acquire the property. However, over
the course of the past several months the parties were
able to reach a mutual agreement for the sale of
approximately 24.28 acres of property from Cardiff
Wales to the District, which transaction closed on the
date hereof. We appreciate your cooperation in
working with the District to conclude this transaction
and avoid the eminent domain process.
¶7 The School District never built a school on the property.
Instead, approximately a decade after the School District acquired
the property, it sold it to a third party.
¶8 After Cardiff Wales learned that the School District had sold
the parcel, the company filed a complaint alleging that the School
District had violated its statutory obligation by not first offering to
sell the property back to Cardiff Wales. Cardiff Wales directed the
(citation omitted). We recite the facts Cardiff Wales presented to the
district court but note that these facts have not been proven.
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CARDIFF WALES v. WASHINGTON COUNTY SCHOOL DISTRICT
Opinion of the Court
court to the section of the Utah Code that requires a subdivision of
the state to grant a right of first refusal to the property’s seller if that
property was acquired under threat of eminent domain. UTAH CODE
§ 78-34-20(2) (2007), replaced by UTAH CODE § 78B-6-521(1)(a)(ii)
(2022). 2 The School District insisted that it had not acquired the
property by threatening eminent domain and moved to dismiss the
complaint.
¶9 The district court granted the School District’s motion to
dismiss. The court opined that Cardiff Wales’s right to repurchase
“hinge[d] . . . largely on the meaning of ‘threat of condemnation’
under the 2007 version of Utah Code § 78-34-20.” And, according to
the district court, because there was “no allegation before the court
that the School [District] ‘specifically authorized the use of eminent
domain’ to acquire the real property” under Utah Code section 78-
34-20(1)(b) (2007), the sale could not have occurred under the threat
of condemnation.
¶10 The court further explained that Cardiff Wales had failed to
allege that the School District had held “a public meeting with the
attendant required public notices, [and] statutory notices to [Cardiff
Wales] . . . and there [was] no claim of any vote to specifically
approve the filing of an eminent domain action in court.” The court
concluded that because there had been “no allegation of specific or
formal authorization for the use of eminent domain, the right of first
refusal claimed by [Cardiff Wales] ha[d] not been triggered.” Cardiff
Wales appealed.
¶11 The court of appeals read the statute similarly to the district
court. It held that a “threat of condemnation” arose only when a
government entity has “specifically authorized the use of eminent
domain to acquire real property.” Cardiff Wales LLC v. Wash. Cnty.
Sch. Dist., 2021 UT App 21, ¶ 11, 483 P.3d 1262 (emphasis omitted).
The court then concluded that Cardiff Wales “fail[ed] to give due
meaning to the requirement that the use of eminent domain be
‘specifically authorized.’” Id. ¶ 12 (quoting UTAH CODE § 78-34-
20(1)). The court of appeals opined that the 2007 version of the
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2 When these events occurred, Utah Code section 78-34-20
governed the threat of condemnation and right of refusal. Utah Code
section 78-34-20 has since been renumbered as section 78B-6-521. See
H.R. 78, 57th Leg., Gen. Sess. (Utah 2008). The amendments make no
change relevant to our analysis, and we cite the version in effect at
the time of the events at issue in the matter.
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statute “governed the process to specifically authorize eminent
domain’s use.” Id.¶12 The court next defined “specifically authorized” by drawing
from a separate section of the code which provides “that ‘[p]roperty
may not be taken by a political subdivision of the state unless the
governing body of the political subdivision approves the taking’”
and spells out the steps it must take for the use to be approved. Id.(quoting UTAH CODE § 78-34-4(2)(b)) (alteration in original). One of
those steps requires the entity’s governing body to vote to approve
the filing of an eminent domain complaint. Id.
¶13 The court of appeals concluded that “to survive the motion
to dismiss under the theory that [the School District] acquired the
Property by threat of condemnation, Cardiff [Wales] must allege that
[the School District] voted and approved the use of its eminent
domain power to acquire the Property.” Id. ¶ 13. Accordingly, the
court of appeals held that the district court correctly dismissed the
complaint for failure to state a claim upon which relief could be
granted because Cardiff Wales never alleged that the School District
took a final vote to approve filing an eminent domain action. Id.
¶14 Cardiff Wales petitioned for a writ of certiorari.
STANDARD OF REVIEW
¶15 The court of appeals affirmed the district court’s grant of a
motion to dismiss for failure to state a claim. We review the court of
appeals’ decision for correctness, granting no deference to the
decision of the lower court. Amundsen v. Univ. of Utah, 2019 UT 49,
¶ 20, 448 P.3d 1224 (citation omitted). “‘In so doing, we accept the
plaintiff’s description of the facts alleged in the complaint to be true’
and view all reasonable inferences from those facts in the light most
favorable to the plaintiff.” Id. (citation omitted).
¶16 Cardiff Wales asks us to consider whether the court of
appeals erred in its construction and application of Utah Code
section 78-34-20 when it concluded that the company did not face a
threat of condemnation because it did not allege that the School
District had taken a final vote to approve a condemnation action.
This question requires us to interpret and apply the relevant statutes.
“We review questions of statutory interpretation for correctness,
affording no deference to the [lower] court’s legal conclusions.” State
v. Gallegos, 2007 UT 81, ¶ 8, 171 P.3d 426.
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CARDIFF WALES v. WASHINGTON COUNTY SCHOOL DISTRICT
Opinion of the Court
ANALYSIS
I. THE COURT OF APPEALS ERRED IN ITS INTERPRETATION
OF THE STATUTORY PHRASE “SPECIFICALLY
AUTHORIZED”
¶17 The court of appeals held that under Utah Code section 78-
34-20, a government entity must have “specifically authorized” the
use of eminent domain before a “threat of condemnation” can exist.
Cardiff Wales LLC v. Wash. Cnty. Sch. Dist., 2021 UT App 21, ¶ 12, 483
P.3d 1262. The court then opined that the government entity
specifically authorizes the use of eminent domain when it follows
the requirements in Utah Code section 78-34-4 to approve the filing
of a condemnation action. Id.¶18 Cardiff Wales asserts that the court of appeals erred in two
ways. It first contends that the court of appeals misread Utah Code
section 78-34-20 when it defined a “threat of condemnation” as
arising only when a government entity has “specifically authorized”
the use of eminent domain. Cardiff Wales next argues that even if
specific authorization is required, the court of appeals erred when it
concluded that specific authorization could only occur by fulfilling
all the statutory prerequisites for filing an eminent domain lawsuit.
¶19 Cardiff Wales asserts that the court of appeals misconstrued
Utah Code section 78-34-20 when it defined a “threat of
condemnation” as occurring only when a government entity with
the power of eminent domain “has specifically authorized the use of
eminent domain to acquire [] real property.” UTAH CODE § 78-34-
20(1)(b) (2007), replaced by UTAH CODE § 78B-6-521(1)(a)(ii) (2022).
¶20 Utah Code section 78-34-20 states:
(1) As used in this section, “condemnation or threat of
condemnation” means:
(a) acquisition through an eminent domain proceeding;
or
(b) an official body of the state or a subdivision of the
state, having the power of eminent domain, has
specifically authorized the use of eminent domain to
acquire the real property.
(2) If the state or one of its subdivisions, at its sole
discretion, declares real property that is acquired
through condemnation or threat of condemnation to be
surplus real property, it may not sell the real property
on the open market unless:
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(a) the real property has been offered for sale to the
original grantor, at the highest offer made to the state
or one of its subdivisions with first right of refusal
being given to the original grantor . . . .
¶21 The court of appeals interpreted the statute to have “two
distinct parts.” Cardiff Wales LLC, 2021 UT App 21, ¶ 11. The first
part defined “acquisition by ‘condemnation,’” and the second
defined “acquisition by ‘threat of condemnation.’” Id. (quoting UTAH
CODE § 78-34-20(1) (2007)). Thus, it concluded that under the plain
language of the statute, “property is acquired under ‘threat of
condemnation’ when ‘an official body of the state or a subdivision of
the state, having the power of eminent domain, has specifically
authorized the use of eminent domain to acquire the real property.’” Id.
(quoting UTAH CODE § 78-34-20(1)).
¶22 Cardiff Wales argues that the court of appeals’ reading of the
statute eliminates the utility of the word “threat” within the phrase
“threat of condemnation.” It explains that “[t]he best reading of the
statute—one that would preserve the independent meaning of the
word ‘threat’—would understand ‘condemnation’” to mean either
“(a) ‘acquisition through an eminent domain proceeding’ or
(b) ‘authoriz[ing] the use of eminent domain to acquire the
property.’” Whereas “threat of condemnation” means either “(a) the
threat of ‘acquisition through an eminent domain proceeding’ or
(b) the threat of ‘authoriz[ing] the use of eminent domain to acquire
the property.’” (Quoting UTAH CODE § 78-34-20(1).)
¶23 When we approach a statute, “our primary goal is to evince
the true intent and purpose of the Legislature.” State v. Martinez,
2002 UT 80, ¶ 8, 52 P.3d 1276 (citation omitted) (internal quotation
marks omitted). “In doing so, [w]e presume that the legislature used
each word advisedly and read each term according to its ordinary
and accepted meaning. Additionally, [w]e read the plain language of
the statute as a whole [] and interpret its provisions in harmony with
other statutes in the same chapter.” Harold Selman, Inc. v. Box Elder
Cnty., 2011 UT 18, ¶ 18, 251 P.3d 804 (alterations in original)
(citations omitted) (internal quotation marks omitted). “We will
resort to other methods of statutory interpretation only if we find the
[plain] language of the statutes to be ambiguous.” State v. Vigil, 842
P.2d 843, 845 (Utah 1992), abrogated on other grounds by State v. Casey,
2003 UT 55, 82 P.3d 1106. “[W]hen the construction of a section
involves technical words and phrases which are defined by statute,
the provision must be construed according to such peculiar and
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CARDIFF WALES v. WASHINGTON COUNTY SCHOOL DISTRICT
Opinion of the Court
appropriate meaning or definition.” Cannon v. McDonald, 615 P.2d
1268, 1270 (Utah 1980).
¶24 We agree with the court of appeals’ assessment of the
structure of subsection (1). See Cardiff Wales LLC, 2021 UT App 21,
¶ 11. The subsection’s first sentence indicates that it aims to provide
definitions for two terms—“condemnation” and “threat of
condemnation.” UTAH CODE § 78-34-20(1). The Legislature marked
“condemnation” and “threat of condemnation” as individual terms
by separating them with the word “or.” After providing the two
terms, the subsection gives two discrete definitions in (1)(a) and
(1)(b). Though there are clearer ways to define two terms, reading
the statute as a whole suggests that the Legislature intended to give
these two separate terms two separate definitions. Thus, subsection
(1)(a) defines “condemnation” and subsection (1)(b) defines “threat
of condemnation.” Because the plain language of the statute
supports this conclusion, we conclude, just as the court of appeals
concluded, that property is acquired under “threat of
condemnation” when “an official body of the state or a subdivision
of the state, having the power of eminent domain, has specifically
authorized the use of eminent domain to acquire the real property.”
Id. § 78-34-20(1)(b); see also Cardiff Wales LLC, 2021 UT App 21, ¶ 11.
¶25 Cardiff Wales also argues that the court of appeals
improperly applied the statute when it used the requirements to
approve the filing of an eminent domain action listed in Utah Code
sections 78-34-4, -4.5 to give meaning to the phrase “specifically
authorized” in section 78-34-20. 3
¶26 Utah Code sections 78-34-4, -4.5 detail the procedure that a
government entity must follow before it can file an eminent domain
lawsuit. Utah Code section 78-34-4(2)(b) indicates that “[p]roperty
may not be taken by a political subdivision of the state unless the
governing body of the political subdivision approves the taking.”
(Emphasis added.) Sections 4 and 4.5 then list several things the
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3 Cardiff Wales also argues that the phrase “specifically
authorized” within the statute is ambiguous and, pointing to our
decision in Marion Energy, claims all ambiguities must be construed
in its favor. See Marion Energy, Inc. v. KFJ Ranch P’ship, 2011 UT 50,
267 P.3d 863. Because the statute is unambiguous, we need not
comment on Cardiff Wales’s reading of Marion Energy.
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government entity must do to before it can “approve” the
condemnation action. 4 See UTAH CODE §§ 78-34-4(c), -4.5.
¶27 These requirements include: (1) making a “reasonable effort
to negotiate with the property owner for the purchase of the
property,” id. § 78-34-4.5(1); (2) informing the property owner of her
rights to mediation and arbitration under Utah Code section 78-34-
21, as well as the name and current telephone number of the
property rights ombudsman, id. § 78-34-4.5(2)(a); (3) providing the
property owner with a “written statement explaining that oral
representations or promises made during the negotiation process are
not binding upon the person seeking to acquire the property by
eminent domain,” id. § 78-34-4.5(2)(b); (4) giving “written notice to
each owner of property to be taken of each public meeting of the
political subdivision’s governing body at which a vote on the
proposed taking is expected to occur,” id. § 78-34-4(2)(c); and
(5) taking a final vote, id. A government entity cannot grant final
approval to file a condemnation action until all five of these
prerequisites have been met.
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4 Utah Code section 78-34-4(2) states:
(b) Property may not be taken by a [county, city, or
town] unless the legislative body of [that] political
subdivision approves the taking.
(c) Before taking a final vote to approve the filing of
an eminent domain action, the governing body of each
political subdivision intending to take property shall
provide written notice to each owner of property to be
taken of each public meeting of the political
subdivision’s governing body at which a vote on the
proposed taking is expected to occur and allow the
property owner the opportunity to be heard on the
proposed taking.
(d) The requirement under Subsection (2)(c) to
provide notice to a property owner is satisfied by the
governing body mailing the written notice to the
property owner:
(i) at the owner’s address as shown on the records
of the county assessor’s office; and
(ii) at least ten business days before the public
meeting.
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CARDIFF WALES v. WASHINGTON COUNTY SCHOOL DISTRICT
Opinion of the Court
¶28 The court of appeals held that “Utah Code section 78-34-4
governed the process to specifically authorize eminent domain’s
use.” Cardiff Wales LLC, 2021 UT App 21, ¶ 12 (footnote omitted).
According to the court of appeals, property cannot be taken until
“specific authorization or approval” is given “by final vote of the
governing body, before which the body had to ‘provide written
notice to each owner of property to be taken of each public meeting
. . . at which a vote on the proposed taking is expected to occur.’” Id.(alteration in original) (quoting UTAH CODE § 78-34-4(2)(c)).
“Accordingly,” the court held “it is only after a final vote, and the
use of eminent domain powers thereby approved, that eminent
domain’s use has been ‘specifically authorized’ as contemplated by
section 78-34-20.” Id. Employing this reasoning, the court concluded
that Cardiff Wales had failed to state a claim because the company
never argued that the School District took a final vote to approve an
eminent domain lawsuit. Id. ¶ 13. This was error.
¶29 We start by noting that the Legislature used the term
“specifically authorized” in section 78-34-20 and “approve the filing
of an eminent domain action” in section 78-34-4. Absent contrary
textual clues, we presume that variations in statutory language are
meaningful. “Different words used in . . . a similar[ ] statute are
assigned different meanings whenever possible.” Bylsma v. R.C.
Willey, 2017 UT 85, ¶ 64 n.115, 416 P.3d 595 (alterations in original)
(citing 2A SUTHERLAND STATUTES AND STATUTORY CONSTRUCTION
§ 46:6 (7th ed.)). Because we recognize that the Legislature used
different words in Utah Code section 78-34-4 than it did in 78-34-20,
we presume that the sections refer to different ideas. It would be
inappropriate to import the requirements for approving the filing of
a lawsuit—contained in section 78-34-4—into section 78-34-20’s
definition of the threat of condemnation absent some suggestion that
the Legislature intended that result.
¶30 In other words, we presume that if the Legislature wanted to
condition the right of first refusal on a government entity approving
the filing of a lawsuit under 78-34-4, it would have cross-referenced
that section, repeated those requirements in 78-34-20, or used the
same terminology—approved—in both sections. Since the
Legislature did none of those things, we start from the premise that
the Legislature used different words for a reason, and we stick with
that presumption unless a party can convince us that the Legislature
intended the language to function differently.
¶31 Focusing on section 78-34-20’s plain language, it appears that
by requiring that the government entity “specifically authorize” the
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use of eminent domain, the Legislature is signaling that the
government’s general ability to condemn land is not enough to
generate a threat of condemnation. A landowner cannot simply
claim she sold her land to the government because of a general fear
that the government might have taken it had she not sold. Instead, to
meet her statutory burden, a landowner must plead and prove some
government action that indicates the government has authorized the
use of its eminent domain authority in a way that bespeaks a specific
intent to condemn the landowner’s property.
¶32 The statute’s structure further exposes the infirmities in the
court of appeals’ interpretation. Before the government entity can
approve the filing of an eminent domain lawsuit, it must “make a
reasonable effort to negotiate with the property owner.” See UTAH
CODE § 78-34-4.5(1). The entity must also advise the landowner that
she has a right to mediation and arbitration. See id. § 78-34-4.5(2).
Under the court of appeals’ reading, a government entity could send
a notice to the landowner, negotiate with the landowner as a prelude
to filing a lawsuit, and participate in arbitration and/or mediation
with the landowner, but still not trigger the statutory right of first
refusal because none of these actions would give rise to a threat of
eminent domain. It seems highly unlikely that the Legislature
intended the right of first refusal to come into play only if the
landowner resisted any negotiated resolution during mediation
and/or arbitration and waited to sell until after the government
entity had taken a vote to approve the filing of a lawsuit. At the very
least, there is no suggestion in the statute that this is the way the
Legislature anticipated that the process would work.
¶33 The statute’s evolution supports our reading of “specifically
authorized.” In 1983, Utah Code section 78-34-20(1) read,
“condemnation, or [] threat of condemnation, . . . as used in this
section, means acquisition of real property by a subdivision of the
state having the right to exercise the power of eminent domain.”
That version of the statute provided that whenever a government
entity with the general authority to use the eminent domain power
obtained land, the previous owner was owed a statutory right of first
refusal.
¶34 The Legislature modified this statutory right in the 1996
version so that the right of first refusal arose only in cases where the
general threat of the government’s eminent domain power had been
converted into a particularized threat. That is, in 1996, the
Legislature added the “specifically authorized” language.
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CARDIFF WALES v. WASHINGTON COUNTY SCHOOL DISTRICT
Opinion of the Court
¶35 In 2006, the Legislature amended Utah Code section 78-34-4.5
to require government entities to negotiate the purchase of a
property before taking the land via eminent domain. See id. § 78-34-
4.5(1). And the amendment added a number of steps the entity must
take before it can approve filing an eminent domain complaint. See
id. §§ 78-34-4, -4.5.
¶36 This history demonstrates that the court of appeals used
language that entered the Code in 2006 to define a term the
Legislature enacted in a different section of the Code in 1996.
Although the Legislature can undoubtedly amend a statute to
clarify, refine, or even provide a definition of an already-existing
term, there is nothing in the statute to suggest that was the
Legislature’s intent in this instance. Indeed, there is no reason to
believe that the Legislature had the right of first refusal in mind
when it added additional hoops for a government entity to jump
through before it could use its eminent domain power.
¶37 Simply stated, the court of appeals erred when it concluded
that a government entity must approve the filing of an eminent
domain complaint before a threat of condemnation exists and
triggers the landowner’s right of first refusal. The statute requires
only what section 78-34-20 says it requires, namely that “an official
body of the state or a subdivision of the state . . . has specifically
authorized the use of eminent domain to acquire the real property.”
Without further legislative guidance or definition about what form
that authorization must take, a landowner must plead and prove
that the entity to which she sold her property had, in some way,
specifically authorized the use of eminent domain to take it.5
¶38 This means that to survive a motion to dismiss, Cardiff Wales
needed to plead that the School District took some sort of action that
transformed its general eminent domain power into a specific threat
to take Cardiff Wales’s parcel by eminent domain. Although Cardiff
Wales did not use the words “specifically authorize” in its
complaint, it did plead facts that, with the benefit of the inferences
_____________________________________________________________
5 To be clear, the court of appeals was correct to assert that one
way a landowner could meet this burden would be to plead and
prove that the entity had approved filing an eminent domain lawsuit
to take the property. The court of appeals erred, however, by
concluding that this was the only way an entity could specifically
authorize the use of eminent domain.
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available to the non-moving party on a motion to dismiss, allow it to
meet its pleading burden.
¶39 Cardiff Wales alleged, in its complaint, that the School
District told the company it wanted to buy the company’s property
for a new high school and “intended to acquire the Parcel through
condemnation if necessary.” Cardiff Wales explained that it
ultimately sold the parcel “in order to avoid an eminent domain
lawsuit.” Cardiff Wales attached to its complaint a copy of a letter it
received from the School District that stated the School District
“informed [Cardiff Wales], in accordance with Utah State law, that if
agreeable terms could not be reached with Cardiff Wales, LLC for
the purchase of the property, the [School] District would be forced to
use eminent domain powers to acquire the property.”
¶40 On a motion to dismiss, the district court must treat “the
facts alleged in the complaint to be true and view all reasonable
inferences from those facts in the light most favorable to the plaintiff.”
Amundsen v. Univ. of Utah, 2019 UT 49, ¶ 20, 448 P.3d 1224 (emphasis
added) (citation omitted) (internal quotation marks omitted). While
Cardiff Wales did not use the term “specifically authorize” in its
complaint, it alleged facts sufficient to give rise to a reasonable
inference that the School District had specifically authorized the use
of eminent domain to acquire the land if Cardiff Wales did not sell.
This means that Cardiff Wales alleged that it sold the property under
a threat of eminent domain which gave rise to the right of first
refusal. Cardiff Wales met its pleading burden, and the court of
appeals erred in affirming the district court’s grant of the motion to
dismiss.
CONCLUSION
¶41 The court of appeals correctly held that property is not sold
under a “threat of condemnation” unless the government entity
specifically authorizes the use of eminent domain. The court of
appeals erred, however, when it concluded that a government entity
must approve the filing of an eminent domain complaint to
specifically authorize the use of condemnation. The court of appeals
thus erred in affirming the district court’s decision to dismiss Cardiff
Wales’s complaint. We reverse and remand.
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