Beroth Oil Co. v. North Carolina Department of Transportation

757 S.E.2d 466, 367 N.C. 333, 2014 WL 1477931, 2014 N.C. LEXIS 291
CourtSupreme Court of North Carolina
DecidedApril 11, 2014
DocketNo. 390PA11-2
StatusPublished
Cited by28 cases

This text of 757 S.E.2d 466 (Beroth Oil Co. v. North Carolina Department of Transportation) is published on Counsel Stack Legal Research, covering Supreme Court of North Carolina primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Beroth Oil Co. v. North Carolina Department of Transportation, 757 S.E.2d 466, 367 N.C. 333, 2014 WL 1477931, 2014 N.C. LEXIS 291 (N.C. 2014).

Opinions

JACKSON, Justice.

In this appeal we consider whether the Court of Appeals erred by affirming the trial court’s order denying plaintiffs’ motion for class certification. We hold that analyzing the substantive merits of plaintiffs’ inverse condemnation claim is improper at the class certification stage and therefore, the trial court and the Court of Appeals erred in doing so. We also conclude that because of the unique nature of property, coupled with the large number of diverse tracts involved in this litigation, individual issues would predominate over common [334]*334issues of law and fact in a trial on the merits. Accordingly, we affirm in part, vacate in part, and reverse in part the opinion of the Court of Appeals for the reasons stated below.

Pursuant to the Transportation Corridor Official Map Act (“the Map Act”), the North Carolina Department of Transportation (“NCDOT”) recorded corridor maps with the Forsyth County Register of Deeds on 6 October 1997 and 26 November 2008 identifying transportation corridors for the construction of a highway project known as the Northern Beltway. See N.C.G.S. §§ 136-44.50 to -44.54 (2011). Approximately 2,387 parcels of land are listed as located within the Northern Beltway. Plaintiffs are owners of some of these properties. After the filing of a corridor map, the Map Act prohibits issuance of a building permit or approval of any subdivision plat for any property located within the transportation corridor. Id. § 136-44.51(a). However, owners of affected properties are not without recourse because these restrictions can be lifted three years after the submission of an application for a building permit or subdivision plat approval if, inter alia, efforts to acquire the property have not been initiated. Id. § 136-44.51(b). The Map Act also allows the granting of a variance exempting a landowner from these restrictions upon a showing that “no reasonable return may be earned from the land” and the restrictions “result in practical difficulties or unnecessary hardships.” Id. § 136-44.52. Finally — through what is referred to as the “Hardship Program” — the Map Act allows for “advanced acquisition of specific parcels of property when that acquisition is determined ... to be in the best public interest to protect the transportation corridor from development or when the [corridor map] creates an undue hardship on the affected property owner.” Id. § 136-44.53(a).

Plaintiffs’ brief states that as of 22 March 2013, NCDOT had purchased over 454 properties in the Northern Beltway. Apparently, a large number of these properties were acquired even before the corridor maps were filed. Earlier, on 18 February 1999, a group of affected property owners filed a lawsuit in the United States District Court for the Middle District of North Carolina, which resulted in a court order issued in June 1999 barring “any irrevocable actions relating to construction, right-of-way acquisitions, or negotiations for right-of-way acquisitions, in furtherance of the [Northern Beltway].” N.C. Alliance for Transp. Reform, Inc. v. USDOT, 713 F. Supp. 2d 491, 499 (M.D.N.C. 2010). For the next eleven years, this federal order prevented NCDOT from taking any action as to any of the affected [335]*335properties.1 On 19 May 2010, the injunctive provisions in the court’s order were lifted, id. at 513, and NCDOT resumed making advanced acquisitions. NCDOT has purchased at least six properties since then.

On 16 September 2010, plaintiffs filed a complaint and declaratory judgment action in Superior Court, Forsyth County, asserting five “claim[s] for relief’: (1) inverse condemnation pursuant to N.C.G.S. § 136-111; (2) an unlawful taking in violation of the Fifth Amendment to the United States Constitution pursuant to 42 U.S.C. § 1983; (3) denial of equal protection in violation of the Fourteenth Amendment to the United States Constitution pursuant to 42 U.S.C. § 1983; (4) a wrongful taking in violation of Article I, Section 19 of the North Carolina Constitution; and (5) a request for declaratory relief seeking a declaration of taking and the date of the taking, or, in the alternative, a declaration that the Hardship Program and the Map Act are unconstitutional in that “they [ejffect a taking by the NCDOT without just compensation and are unequal in their application to property owners.” Plaintiffs alleged that in the thirteen years since the department filed the corridor maps, NCDOT has not commenced any condemnation or eminent domain actions against them, but has acquired other property within the Northern Beltway through the Hardship Program. Plaintiffs alleged that NCDOT does not maintain its Northern Beltway property to the standards of other property owners and that it leases its property for less than fair market value, resulting in “condemnation blight” in the Northern Beltway. Plaintiffs further alleged that NCDOT intends to purchase plaintiffs’ properties at some future date but no schedule for acquisition of property has been announced, and NCDOT has stated that no funds are available to begin acquisitions for the next ten years. Plaintiffs alleged that NCDOT’s actions have placed a “cloud” upon all real property in the Northern Beltway by “destroying and nullifying [the] properties’ value,” “substantially interfering with [all property owners’] elemental and constitutional rights growing out of the ownership of the properties,” and “restricting [their] capacity to freely sell their properties,” and that NCDOT’s conduct constitutes a taking of their properties without just compensation.

Plaintiffs also sought class certification for themselves “and all others similarly situated who own property in the Northern Beltway in Forsyth County and are subject to [the Map Act].” Plaintiffs alleged [336]*336that “[t]here are over 500 potential class members” who “have been deprived of their property rights” and whose property NCDOT “is obligated to purchase.” Plaintiffs proposed a bifurcated trial in which the first phase would determine whether NCDOT is liable to the class, and the second phase would consist of individual trials to determine each property owner’s individual damages. Plaintiffs filed a separate motion for class certification on 18 March 2011, alleging that “[t]here are no less tha[n] 800 class members” who “have had their property adversely impacted by the NCDOT’s [m]aps, the [Map Act,] and the actions of the NCDOT” and who therefore “have an interest in the same issues of fact and law, and these issues predominate over issues affecting only individual class members.”

NCDOT filed an answer and motion to dismiss plaintiffs’ claims pursuant to Rules 12(b)(1), (2), and (6) of the North Carolina Rules of Civil Procedure, and raised the defense of sovereign immunity. The trial court granted NCDOT’s motion to dismiss as to plaintiffs’ second, third, and fourth claims, as well as the portion of plaintiffs’ fifth claim seeking a declaration of taking and date of taking. The trial court denied NCDOT’s motion to dismiss plaintiffs’ first claim of inverse condemnation, and their fifth claim seeking a declaration of the Map Act as unconstitutional. Neither party has appealed from this order. The trial court heard plaintiffs’ motion for class certification on 25 April 2011 and entered an order on 20 May 2011 denying class certification.

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Cite This Page — Counsel Stack

Bluebook (online)
757 S.E.2d 466, 367 N.C. 333, 2014 WL 1477931, 2014 N.C. LEXIS 291, Counsel Stack Legal Research, https://law.counselstack.com/opinion/beroth-oil-co-v-north-carolina-department-of-transportation-nc-2014.