- A plaintiff involved in a Map Act dispute with the North Carolina Department of Transportation is disputing DOT's argument that a recent state Appeals Court ruling could produce "calamitous" results.
- DOT is asking the state Supreme Court to reverse appellate judges' decision. Plaintiff William Sanders responded Monday. He asked the state's high court to reject DOT's appeal.
- The dispute involves court interpretations of the Map Act's impact on property values. DOT warned that the Appeals Court's decision could open the door to 1,600 new lawsuits and result in a taxpayer bill topping $1 billion.
A plaintiff in a Map Act dispute with the North Carolina Department of Transportation disputes the department’s claims about a recent state Court of Appeals decision. DOT argued that the decision could produce “calamitous” results for taxpayers.
The Map Act, repealed in 2019, allowed DOT to block any development of private property within designated highway corridors.
The department filed paperwork earlier this month asking the state Supreme Court to take the case Sanders v. NCDOT. DOT lawyers urged the high court to reverse the Appeals Court’s unanimous decision in the case.
Plaintiff William Sanders filed a response Monday.
“DOT begins with the familiar claim that ‘the sky is falling’ and the unanimous Court of Appeals decision will be ‘calamitous’ if allowed to stand. There is nothing novel about this case. Simply put, DOT must pay for every property interest it takes, just as a buyer would in the marketplace,” Sanders’ lawyers wrote.
“Here, DOT took negative easements in 1992 and 2006. It took fee interests and affirmative easements in 2002 and in 2010,” the document continued. “If Mr. Sanders had sold these interests in the market, he would have been paid for each of them. DOT cannot use its power of eminent domain to get them for free. The rules of eminent domain are intended to replicate the marketplace.”
“Nor can DOT use the fiction that the rescinded map restrictions still encumber property in order to depress the price it pays when it needs to acquire property,” Sanders’ lawyers argued. “Consider the unfair results that would follow from ignoring the reality that the map restrictions were rescinded. After the restrictions were rescinded, registers of deeds removed the restrictions from the chains of title for the formerly encumbered properties. If an owner whose property had been encumbered by the map restrictions for the Wake Outer Loop sold her property in 2017, the buyer would pay the full, unrestricted value, because the restrictions had been rescinded and a title search would show the property as unrestricted.”
“Then, when DOT needed to acquire the property to build the Outer Loop in 2020, it would pay the buyer the lower value based on the fiction that the restrictions still encumber the property. The Court of Appeals unanimously rejected DOT’s arguments, and rejected them again in denying DOT’s motion for rehearing,” the document added.
“DOT’s claim that this case will reopen Map Act litigation is false. Mr. Sanders’ claim is one of only 25 unresolved Map Act claims. The hundreds that have been resolved will not be undone by the Sanders decision because their direct condemnations were settled with consent judgments that specifically waived their Map Act claims,” Sanders’ lawyers wrote.
After Sanders filed his case, “only five similar cases have been filed, three in Wake County and two in Forsyth,” according to the court filing.
DOT lawyers painted a much different picture of the Sanders case’s impact.
“The present case is based on a claim for inverse condemnation under the Map Act by a landowner who asserted his claim nearly ten years after DOT condemned his property for the highway project and paid him almost fifteen million dollars ($15,000,000) in just compensation,” DOT argued in its state Supreme Court petition. “The Court of Appeals’ decision affirms a trial court order permitting the landowner to sustain a Map Act claim for additional compensation for the portion of his property DOT did not take in fee simple and to receive the rental value of his property for the duration of the Map Act taking as damages.”
The Appeals Court ruling “conflicts” with the state Supreme Court’s prior Map Act decisions, according to the DOT. “Specifically, it undermines the established law of the Map Act because it allows the landowner to seek a different measure of damages based on a different conception of the nature and duration of the taking established by this Court,” according to the petition.
“In addition, it undermines how our eminent domain statutes and our law governing consent judgments prevent landowners who have been paid just compensation from using inverse condemnation to seek additional money for damages they should have raised during the condemnation proceeding. The practical effects of the decision will be calamitous,” DOT lawyers argued.
The challenged Appeals Court ruling “opens the door to over one thousand new Map Act claims at precisely the moment when DOT has settled all but a few remaining Map Act claims,” according to the petition.
Since the state Supreme Court’s first Map Act ruling in 2016, DOT and landowners have finalized about 700 Map Act cases. DOT has spent more than $763 million in just compensation. About 25 Map Act cases remain active, according to DOT’s court filing.
“The Court of Appeals’ decision here threatens to undo DOT’s progress in resolving the Map Act litigation,” the department’s lawyers argued. “One aspect of the Court of Appeals’ decision would permit landowners whom DOT has already paid just compensation for a condemnation of their property to assert Map Act claims for additional compensation years, and in some cases decades, after the entry of a condemnation consent judgment.”
DOT estimates that the Appeals Court ruling could create 1,198 new Map Act cases in Forsyth and Guilford counties, along with 465 new cases in Cumberland County. “These new cases could carry the overall cost of the Map Act litigation well over one billion dollars ($1,000,000,000) and require an additional decade to resolve.”
The Appeals Court ruling treated the impact of a Map Act taking differently than the way the state Supreme Court has addressed the issue in the past, DOT argued. The change has an impact on the amount of damages a landowner could seek.
“The combined consequences of the Court of Appeals’ decision – its creation of potentially thousands of new Map Act cases and its recognition of a new measure of damages that will cause the cost of each case to skyrocket – will incentivize more Map Act claims from landowners who settled their claims years, and in some cases, decades ago,” DOT lawyers warned.
In the current case, Sanders v. NCDOT, a landowner who was paid $15 million in 2011 for more than 101 acres might seek a higher sum for an additional 28 acres, DOT lawyers argued. “Such a result is manifestly unjust to North Carolina’s taxpayers and the hundreds of landowners who litigated or settled their claims in good faith reliance on this Court’s prior guidance,” the petition argued. “Ultimately, these consequences will be based on nothing more than the Court of Appeals’ misunderstanding of this Court’s prior decisions and its misapplication of the law of eminent domain.”
DOT targets an unpublished Feb. 6 Appeals Court opinion. A unanimous three-judge panel upheld a Cumberland County trial judge’s decision to allow a property owner to move forward with Map Act claims.
The department secured support for its arguments last week from Beroth Oil and James and Carol Deans. Represented by Winston-Salem-based attorney Matthew Bryant, Beroth and the Deans were lead plaintiffs in Map Act lawsuits that started in 2010 and 2011.
The Sanders decision “is completely out of step” with the state Supreme Court’s Map Act precedents, Bryant wrote Friday.