DOT appeals Wake County cases with major Map Act implications

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  • The North Carolina Department of Transportation is urging the state's second-highest court to take two cases with major implications for payments to property owners affected by the Map Act.
  • The General Assembly repealed the Map Act in 2019, three years after the state Supreme Court ruled the legislation unconstitutional.
  • The current dispute involves whether property owners targeted in former DOT corridor maps faced a temporary or indefinite taking of property rights. The difference could affect payments DOT must make to hundreds of affected property owners.

The North Carolina Department of Transportation is asking the state’s second-highest court to take up two cases that could have a significant impact on payments to property owners targeted by the Map Act.

In both cases, a Wake County judge issued rulings in June 2023 that favored property owners over the DOT.

The General Assembly repealed the Map Act in 2019, three years after the state Supreme Court ruled the legislation unconstitutional. The act approved in 1987 had allowed DOT to develop corridor maps for future highway projects. The act allowed DOT to block any development of property covered by the maps.

Property owners whose homes and land remained in limbo for a decade or more took the Transportation Department to court. In the case Kirby v. NC DOT, a unanimous state high court ruled that the DOT’s actions amounted to a “taking of fundamental property rights.” In legal terms, a government taking of property requires a payment called just compensation.

Now, in the cases Mata v. DOT and Wonder Day Partnership v. DOT, property owners and the state agency disagree over whether Map Act takings were temporary or indefinite. The difference could amount to major differences in how much the state must pay to acquire targeted properties.

DOT filed petitions Monday with the state Court of Appeals to accept both cases. The department hopes appellate judges will reverse June 2023 rulings from Superior Court Judge Bryan Collins. The cases involve Wake County properties targeted in a 1996 corridor map for Interstate 540.

“The trial court’s ruling that the recission of the corridor maps converted the taking from indefinite to temporary, if allowed to stand, will have a significant impact on all future litigation under the Map Act,” wrote lawyers representing DOT. “In so ruling, the trial court attempted to distinguish this case from our Supreme Court’s decision in Chappell v. N.C. Dept. of Transportation, which expressly held that a Map Act taking is of indefinite duration.”

The 2020 Chappell case followed up on the Supreme Court’s initial ruling against the Map Act in Kirby.

“Whether the negative easement taken by the Department was temporary or indefinite is important in this case and all other similar pending and subsequent Map Act cases,” DOT’s lawyers argued.

“Each and every one of the potentially hundreds of remaining Map Act lawsuits will require a determination of before and after value by appraisers for both the landowners and the Department,” the petition continued. “This Court’s guidance as to whether the taking was indefinite, as held by the Supreme Court in Kirby and Chappell, or temporary, as held by the trial court here, will be instrumental in allowing those appraisers to develop their opinions, and in allowing the parties to those lawsuits to evaluate their positions and potentially reach settlements.”

“This Court’s ruling on the duration of the Map Act taking will also have a significant effect on direct condemnation actions involving the same properties on which the Department effected Map Act takings,” DOT lawyers argued. “Should this Court adhere to the Supreme Court’s established precedent from Kirby and Chappell and hold that the taking was indefinite in nature, the reduced rights and value remaining after the Map Act taking will directly affect the value of the property prior to the Department’s ultimate condemnation of the same property for its highway project.”

If a Map Act taking is ruled to be temporary, rather than definite, then affected property owners could collect two large payments from DOT for the same land, the petition continued. One payment would address the impact of the Map Act. The other would address the actual taking of the property for highway construction.

“[S]hould this Court accept the invitation to deviate from established precedent and hold that the Map Act taking was temporary in duration and ended in 2016, landowners will presumably argue that the Map Act taking has no effect on the rights held and consequent value of their properties at the time the Department’s direct condemnation actions,” DOT lawyers wrote. “As a practical matter, this result would enable landowners to recover potentially large verdicts in Map Act claims premised on the rental value of their properties over decades of time, followed by a second full recovery for the direct condemnation of the property.”

“Such an outcome would be unjust and inconsistent with this Court’s holding … and the Supreme Court’s holding in Chappell, and this Court should not delay its involvement to uphold its and the Supreme Court’s precedents,” the petition continued.

Collins rejected DOT’s arguments in his rulings last summer. “Invalidation or rescission of an offending statute converts an otherwise indefinite taking into a temporary one,” he wrote in the Wonder Day case. DOT filed paperwork in 2020 to take the Wonder Day property that had been included in the I-540 corridor map.

“The DOT’s arguments are entirely based on multiple ‘imaginary situations’ or fictions,” Collins wrote. “The first fiction is that the restrictions continue to be indefinite when we now know their duration. That fiction is necessary to articulate the next fiction, which is that the Property continues to be encumbered by the restrictions in 2020. If Wonder Day’s Property is valued as restricted by the Map act in 2020, although the restrictions had actually been removed in 2016 and Wonder Day was thereafter able to use or sell its Property as unrestricted, Wonder Day would receive a value based on an imaginary or fictional scenario.”

“The Supreme Court of North Carolina has recognized that, while reducing acquisition costs is a ‘laudable’ goal, the Map Act is not ‘a valid, regulatory exercise of the police power,’ but instead is a regulation that went too far and thus became a taking for which just compensation must be made under the power of eminent domain,” Collins added. “The DOT cannot use its project, including the map restrictions it placed on the Property to limit acquisition costs, to reduce the value of Wonder Day’s Property when it takes the Property through direct condemnation.”

“For purposes of determining just compensation for the taking of Wonder Day’s Property in 2020, the DOT cannot value the Property as restricted because the Property was not restricted in 2020, and the DOT cannot use the restrictions it imposed as part of its Project to depreciate the value of Wonder Day’s Property and thereby take its Property in 2020 at a discounted or restricted price,” the judge determined.

Collins admonished DOT not to treat a Map Act property owner in a different way than others whose properties were targeted for the highway. “Owners whose property was not within the map corridor but whose property was taken in fee in 2020 for the construction of I-540 will be paid the unrestricted value of their property in 2020. Wonder Day is likewise entitled to receive the unrestricted value of its Property in 2020 when the DOT took it in fee in 2020,” the judge wrote. “The burden the Map Act imposed on Wonder Day for more than 20 years is separate from, and over and above, the physical taking it suffered when the DOT took its Property in 2020.”

The John Locke Foundation, which oversees Carolina Journal, submitted friend-of-the-court briefs supporting property owners in the Kirby and Chappell cases.