Mountain Valley Pipeline, LLC v. 8.37 Acres of Land, Owned by Frank H. Terry, Jr.

101 F.4th 350
CourtCourt of Appeals for the Fourth Circuit
DecidedMay 14, 2024
Docket23-1532
StatusPublished
Cited by7 cases

This text of 101 F.4th 350 (Mountain Valley Pipeline, LLC v. 8.37 Acres of Land, Owned by Frank H. Terry, Jr.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fourth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Mountain Valley Pipeline, LLC v. 8.37 Acres of Land, Owned by Frank H. Terry, Jr., 101 F.4th 350 (4th Cir. 2024).

Opinion

USCA4 Appeal: 23-1532 Doc: 43 Filed: 05/14/2024 Pg: 1 of 19

PUBLISHED

UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT

No. 23-1532

MOUNTAIN VALLEY PIPELINE, LLC,

Plaintiff – Appellee,

v.

8.37 ACRES OF LAND, OWNED BY FRANK H. TERRY, JR., JOHN COLES TERRY, III, AND ELIZABETH LEE TERRY ALSO KNOWN AS ELIZABETH LEE REYNOLDS ROANOKE COUNTY TAX MAP PARCEL NO. 102.00-01- 02.00-0000 AND BEING MVP PARCEL NO. VA-RO-046,

Defendant – Appellant,

and

CHARLES MALCOLM LOLLAR, SR.

Defendant.

Appeal from the United States District Court for the Western District of Virginia, at Roanoke. Elizabeth Kay Dillon, District Judge. (7:20-cv-00134-EKD)

Argued: March 21, 2024 Decided: May 14, 2024

Before GREGORY, WYNN, and THACKER, Circuit Judges.

Reversed, vacated, and remanded by published opinion. Judge Thacker wrote the opinion, in which Judge Gregory and Judge Wynn joined. USCA4 Appeal: 23-1532 Doc: 43 Filed: 05/14/2024 Pg: 2 of 19

ARGUED: Norman A. Thomas, NORMAN A. THOMAS, PLLC, Richmond, Virginia, for Appellant. Wade Wallihan Massie, PENN, STUART & ESKRIDGE, Abingdon, Virginia, for Appellee. ON BRIEF: Joseph V. Sherman, JOSEPH V. SHERMAN, P.C., Norfolk, Virginia, for Appellant. Seth M. Land, PENN, STUART & ESKRIDGE, Abingdon, Virginia, for Appellee.

2 USCA4 Appeal: 23-1532 Doc: 43 Filed: 05/14/2024 Pg: 3 of 19

THACKER, Circuit Judge:

Mountain Valley Pipeline (“Appellee”) is constructing an interstate natural gas

pipeline. Through condemnation actions pursuant to the Natural Gas Act, Appellee

acquired easements on properties along the pipeline’s route. Property owned by Frank

Terry, John Coles Terry, and Elizabeth Terry (“Appellants”) was one such property,

which was encumbered by temporary and permanent easements on 8.37 acres. After the

district court granted Appellee immediate possession of the easements, the case

proceeded to a jury trial to determine the amount of just compensation owed by Appellee

to Appellants for the easements.

At trial, various appraisers testified as to the land’s value before and after the

easements. Ultimately, the jury rendered a $523,327 verdict. Appellee moved for

judgment as a matter of law. It argued that the verdict resulted from the jury improperly

mixing expert testimony. After this appeal was docketed, the district court agreed with

Appellee and granted judgment as a matter of law. The court vacated the $523,327 jury

verdict, entered a judgment for $261,033, and conditionally granted a new trial with the

option of remittitur.

Because the jury’s $523,327 verdict can be supported by credited testimony

without mixing different land use valuations, as the district court assumed, we reverse the

district court’s judgment as a matter of law and remand with instructions to reinstate the

$523,327 verdict. We also reverse the grant of a new trial.

Additionally, Appellants moved for attorney’s fees and costs pursuant to federal

law. On that motion, the district court held that federal law did not entitle Appellants to

3 USCA4 Appeal: 23-1532 Doc: 43 Filed: 05/14/2024 Pg: 4 of 19

attorney’s fees. Appellants filed a second motion for attorney’s fees, which asserted that

Virginia law applied. The district court denied the second motion, holding that federal

law, as opposed to state law, applied. However, because the district court lacked

jurisdiction at the point that it ruled on the second motion, we vacate and remand.

I.

A.

Appellee is constructing a natural gas pipeline from West Virginia to Virginia. To

construct the pipeline, Appellee condemned temporary and permanent easements on

property along the pipeline’s route. It needed temporary easements to access property

during the pipeline’s construction and permanent easements for the pipeline itself.

Appellee acquired these easements through condemnation acts pursuant to the Natural

Gas Act. Some of those easements were on Appellants’ property.

Appellants’ property comprises 560 acres in Roanoke County, Virginia. The land

is accessed by a private driveway and improved with a two-story farmhouse, a rental

dwelling, a garage, and storage sheds. The district court granted Appellee immediate

possession of the easements on Appellants’ property. Because the parties could not agree

on a just compensation amount for the easements, the case proceeded to a jury trial.

Before trial, both sides engaged appraisers to value Appellants’ property before

and after the easements in order to measure the just compensation amount that Appellee

would owe Appellants. The appraisers were each deemed expert witnesses by the district

court.

4 USCA4 Appeal: 23-1532 Doc: 43 Filed: 05/14/2024 Pg: 5 of 19

1.

In condemnation cases, appraisers typically begin by determining the highest and

best use of the subject property. The highest and best use of the property is the most

profitable use for the land and can include commercial uses even if the land is currently

used for residential purposes. Then, utilizing the highest and best use of the land,

appraisers value the land before and after the taking. The difference between the before

value and the after value is the amount of just compensation due for the taking.

One of Appellants’ experts, Dennis Gruelle, opined in a report before trial that the

highest and best use of Appellants’ land was as a wind farm. Initially, Gruelle concluded

that a wind farm would be incompatible with the pipeline project. But Appellee’s

appraiser concluded that a wind farm was in fact compatible with the pipeline project.

Gruelle then filed a supplemental report and changed his opinion on the land’s highest

and best use. Instead of solely a wind farm, Gruelle concluded that the property had two

separate highest and best uses, including as a family subdivision and a wind farm. That

said, Gruelle also admitted that the wind farm was compatible with the pipeline

easements.

Appellee moved to exclude Gruelle’s second report, arguing that it was untimely

and not supplemental. The district court granted the motion and excluded Gruelle’s

second report because it contained “several opinions that [were] entirely new and

5 USCA4 Appeal: 23-1532 Doc: 43 Filed: 05/14/2024 Pg: 6 of 19

different from his first report.” J.A. 337. 1 Thus, the district court determined that

Gruelle’s second report was not supplemental.

2.

Four appraisers testified at trial, three of which are relevant here. Gruelle and

Jared Schweitzer testified on behalf of Appellants. Joseph Thompson testified on behalf

of Appellee.

Gruelle’s Testimony

Appellants presented Gruelle as an expert in eminent domain appraising

methodology. Gruelle explained the three approaches to appraising eminent domain

takings: (1) the sales comparison approach, which uses similar sales to value the subject

property; (2) the income approach, which looks at the property’s potential to generate

income; and (3) the cost approach, used with unique properties, which accounts for

special features on the property. Gruelle’s report utilized the sales comparison approach -

- comparing Appellants’ property to four similar sales. One comparative sale had an

adjusted value of $2,594 per acre, and the other three ranged from $2,993–4,604 per acre.

Gruelle concluded that the maximally productive use of the land was as a wind farm. On

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101 F.4th 350, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mountain-valley-pipeline-llc-v-837-acres-of-land-owned-by-frank-h-ca4-2024.