State of Delaware (Department of Transportation) v. PITB, LLC and Stafford Street Capital, LLC and Geyer

• Court: Superior Court of Delaware
• Decided: February 29, 2024
• Docket: S21C-07-016 MHC
• Status: Published

Opinion

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

THE STATE OF DELAWARE, UPON ) THE RELATION OF THE ) SECRETARY OF THE DEPARTMENT ) OF TRANSPORTATION ) ) Plaintiff, ) ) v. ) C.A. No. S21C-07-016 MHC ) PITB, LLC, A Delaware Limited ) Liability Company, 185,651.4503 ) SQUARE FEET (4.262 ACRES ) OF LAND; ALL OF TAX MAP AND ) PARCEL NUMBER 235-8.00-83.00 ) SITUATE IN BROADKILL HUNDRED, ) ) and ) ) STAFFORD STREET CAPITAL, LLC, a ) Delaware Limited liability Company; ) 11,000.00 SQUARE FEET (.2525 ACRES) ) OF NUMBER 235-8.00-83.00 SITUTAE ) IN BROADKILL HUNDRED, ) ) and ) ) BRUCE S. GEYER, a resident of the State ) of Delaware. ) ) Defendants. )

Submitted: February 26, 2024 Decided: February 29, 2024

ORDER REFUSING TO CERTIFY DEFENDANTS’ JOINT CERTIFICATION OF INTERLOCUTORY APPEAL Upon Consideration of Defendants’, PITB, LLC (“PITB”), Stafford Street

Capital, LLC (“Stafford Street”), and Bruce Geyer (“Geyer”), Application for

Certification of Interlocutory Appeal, it appears to this Court that:

1. On July 23, 2021, Plaintiff DelDOT filed a condemnation action to

acquire property held by the Defendants under Title 17, Sections 132 and 137, and

Title 29, Chapter 84, Section 8406(1)(a) of the Delaware Code.1 DelDOT acquired

the property for a highway construction project to improve the safety and capacity

of the intersection of Route 1 and Route 16.2 This matter has been heavily litigated

as evidenced by the passage of time from the initial filing date.

2. Defendants filed a motion for instruction seeking clarification as to how

the value of the condemned property was to be assessed by experts and ultimately

presented to the Court. This Court held oral argument on October 20, 2023,

subsequent briefings were filed, and in a February 6, 2024, Letter Opinion (“Letter

Opinion”) this Court held:

First, Delaware Court’s must follow the Unit Rule (also referred to as the Undivided Fee Rule) when determining the fair market value of a property comprised of multiple interests or estates in a condemnation action. Second, income generated from billboards is business income, not rental income, and therefore not compensable in a condemnation action.3

1 Pl. Compl. ⁋ 2. 2 Pl. Compl. ⁋ 11. 3 DelDOT v. PITB, LLC, 2024 WL 489062, at *1 (Del. Super. Ct. Feb. 6, 2024). 2 3. Defendants filed their Application for Certification of Interlocutory

Appeal on February 16, 2024. DelDOT filed their response on February 26, 2024.

4. In deciding whether to certify Defendants’ appeal this Court must

consider the following: Supreme Court Rule 42(b)(i) “[n]o interlocutory appeal will

be certified by the trial court or accepted by [the Delaware Supreme] Court unless

the order of the trial court decides a substantial issue of material importance that

merits appellate review before a final judgment.”;4 (b)(ii)“ [i]nterlocutory appeals

should be exceptional, not routine, because they disrupt the normal procession of

litigation, cause delay, and can threaten to exhaust scarce party and judicial

resources.”;5 and the eight factors listed in (b)(iii).6

5. Defendants contend they meet the criteria required for an interlocutory

appeal required under Supreme Court Rule 42(b)(iii)(A), 42(b)(iii)(C), 42(b)(iii)(E),

4 Supr. Ct. R. 42 (b)(i). 5 Supr. Ct. R. 42 (b)(ii). 6 (A) The interlocutory order involves a question of law resolved for the first time in this State; (B) The decisions of the trial courts are conflicting upon the question of law; (C) The question of law relates to the constitutionality, construction, or application of a statute of this State, which has not been, but should be, settled by this Court in advance of an appeal from a final order; (D) The interlocutory order has sustained the controverted jurisdiction of the trial court; (E) The interlocutory order has reversed or set aside a prior decision of the trial court, a jury, or an administrative agency from which an appeal was taken to the trial court which had decided a significant issue and a review of the interlocutory order may terminate the litigation, substantially reduce further litigation, or otherwise serve considerations of justice; (F) The interlocutory order has vacated or opened a judgment of the trial court; (G) Review of the interlocutory order may terminate the litigation; or (H) Review of the interlocutory order may serve considerations of justice. 3 and 42(b)(iii)(H). They further contend that interlocutory review will conserve

judicial resources. DelDOT opposes this application.

6. After considering Defendants’ joint application, the Court finds that

while the instructions provided to the parties in the Letter Opinion do determine an

issue of material importance, it does not determine an issue of material importance

sufficient to warrant appellate review before the determination of judgment is

reached in this Court. Further, granting this application would disrupt and cause

delay in an already heavily litigated matter already scheduled for trial once.

Additionally, the Court has considered each of the criteria of Delaware Supreme

Court Rule 42(b)(iii) and concludes as follows to the criterion specifically raised by

Defendants:

a. Rule 42(b)(iii)(A). The issues in this matter are admittedly of first

impression in Delaware. However, this factor alone is not sufficient to outweigh the

inefficiencies and additional costs likely to be incurred by interlocutory appellate

review.

b. Rule 42(b)(iii)(C). Defendants contend that the Letter Opinion is

inconsistent with 10 Del. C. § 6108(g) because that statute uses plural language when

discussing “parties” and “awards” in condemnation actions. The Letter Opinion

does not stand for the contention that multiple parties will not ultimately be justly

compensated in a condemnation action such as this where there are multiple parties

4 with an interest in property, it is therefore not inconsistent with that statute. In

reaching its decision this Court considered the language of the 126th General

Assembly, which stated:

WHEREAS, the Federal Uniform Relocation Assistance and Real Property Acquisition Act of 1970 establishes a new and different program of relocation assistance and uniform real property acquisition policy; and …WHEREAS, continued eligibility of the State of Delaware for various types of Federal Aid is made contingent open compliance with the terms and provisions of the Uniform Relocation Assistance and Real Property Acquisition Act of 1970.7

As the Letter Opinion makes clear the Uniform Relocation Assistance and Real

Property Acquisition Act of 1970 require the application of the Unit Rule.

c. Rule 42(b)(iii(E). Defendants argue the Letter Opinion “is arguably

inconsistent with cases such as Teachers Ins. And Annuity Ass’n[8] and its progeny.”9

This argument ignores Catawba (a case in that progeny) which stated:

[The] Teachers Insurance[10] ruling was imported into the law of eminent domain by the Superior Court in State v. Haskins Revocable Trust,[11] even though that case did not specifically involve the leased fee method of valuation. These cases, however, deal only with the methodology to be employed in determining fair market value. They do not explicitly or implicitly alter the substantive law regarding what must be compensated for in a taking by eminent domain. As noted previously, that law precludes recovery for lost income.12

7 126th General Assembly, 58 Del. Laws, c. 413, SB 626. 8 New Castle Cnty. Dep't of Fin. v. Teachers Ins. & Annuity Ass'n, 669 A.2d 100 (Del. 1995). 9 Defs. Joint Application at 10. 10 669 A.2d 100 (Del. 1995). 11 732 A.2d. 246 (Del. Super. Ct. 1997). 12 State v. Catawba Associates, 2005 WL 481390, at *3 (Del. Super. Ct. Feb. 23, 2005). 5 The holdings of Davis Concrete13 and Catwba14 make it clear this Court has not set

aside prior decisions.

d. Rule 42(b)(iii)(H). Defendants argue that interlocutory review will

serve considerations of justice by eliminating the possibility of a second trial,

ultimately conserving judicial resources.15 This potential benefit of interlocutory

review is significantly outweighed by the probable time and costs associated with

such review. Refusing interlocutory review is the most judicially efficient way to

proceed in such a heavily ligated and slow moving matter all but destined for appeal

from the final judgment of this Court.

7. The potential limited benefits of a determination from our Supreme Court on

these narrow issues are not outweighed by the costs and judicial resources required

to reach such a determination. The most expeditious and judicially efficient way to

proceed forward from this point is without interlocutory review. Therefore, the

interests of justice will not be served with interlocutory review.

13 State ex rel. Sec'y of Dep't of Highways & Transp. v. Davis Concrete of Delaware, Inc., 355 A.2d 883 (Del. 1976). 14 Catawba, 2005 WL 481390. 15 Defs. Joint Application at 10. 6 THEREFORE, Defendants’ Application for Certification of Interlocutory

Appeal is REFUSED.

IT IS SO ORDERED.

/s/ Mark H. Conner Mark H. Conner, Judge

cc: Prothonotary