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City of Tupelo v. O'Callaghan

Supreme Court of Mississippi

January 19, 2017

CITY OF TUPELO, MISSISSIPPI
v.
JOHN PATTERSON (PAT) O'CALLAGHAN AND PATSY K. O'CALLAGHAN

          DATE OF JUDGMENT: 08/28/2015

         LEE COUNTY COUNTY COURT, HON. CHARLES R. BRETT.

          ATTORNEYS FOR APPELLANT: MARTHA BOST STEGALL JOHN S. HILL.

          ATTORNEY FOR APPELLEES: GREGORY W. HARBISON.

          BEFORE DICKINSON, P.J., COLEMAN AND BEAM, JJ.

          BEAM, JUSTICE.

         ¶1. After a nearby ditch began to erode causing significant property damage and mold- related health issues, Plaintiffs John and Patsy O'Callaghan filed an inverse condemnation action under the Takings Clause of the Mississippi Constitution, requesting that the City of Tupelo compensate the couple for both personal injuries and significant property loss. The City of Tupelo presents this interlocutory appeal challenging the Lee County Court's order denying its motion for summary judgment on the matter. The City of Tupelo presents four issues, all of which were promulgated by the Lee County Court in its order on summary judgment. Finding that personal injuries are not recoverable in a claim under the Takings Clause and that the three-year limitations period under Mississippi Code Section 15-1-49 is applicable to takings claims, we reverse the lower court's ruling, rendering a decision for the defendants.

         FACTS

         ¶2. In the late 1960s, John "Pat" O'Callaghan purchased the home at 2306 Rasberry Street in Tupelo, Mississippi, where he and his first wife resided for nearly fifteen years. Built in 1961, [1] the property originally included a one story, single-family home, with an attached, open-wall carport. To accommodate storm water drainage, the developer installed a six-inch pipe, running adjacent to the home and under Rasberry Street, diverting rain water flowing from the land into a ditch across the road. When O'Callaghan purchased the property, this drainage pipe provided an adequate solution to water runoff flowing from his yard during moderate to heavy rainstorms.

         ¶3. Between 1981 and 1982, O'Callaghan and his first wife filed for divorce. He then moved out of the Rasberry Street residence, while his wife continued to dwell in the home. As part of their marital settlement agreement, both O'Callaghan and his first wife remained as co-owners on the property's title. In 1993, O'Callaghan purchased his first wife's interest in the property. O'Callaghan and his second wife moved into the home shortly thereafter and have remained there since.

         ¶4. In 1992, just prior to O'Callaghan's return to Rasberry Street, the City of Tupelo (Tupelo) replaced the six-inch drainage pipe with a thirty-six to forty-two-inch pipe, attached to an open ditch along the west side of the property.[2] The ditch originally spanned roughly four feet wide by four feet deep and served to funnel the rain runoff from the neighboring subdivisions which frequently would wash out yards on Rasberry Street. Although the ditch encroached onto their property, neither O'Callaghan nor his first wife filed a complaint with the City regarding its installation.

         ¶5. In 1996, O'Callaghan and his second wife decided to improve the property by enclosing the existing carport and creating an apartment living space. The carport-located on the west end of the property, adjacent to the drainage ditch-was an open structure attached to the main dwelling house, including a roof and a half-wall on the west side of the foundation. It also housed the property's laundry room in the back corner. O'Callaghan enclosed the carport, adding front and back walls, windows, and a full bathroom. Although he never had the foundation inspected prior to the renovation, O'Callaghan used a licensed carpenter, along with other contractors, to complete the project.

         ¶6. Roughly eighteen months after the apartment was finished, O'Callaghan noticed wall cracks and roof leaks developing in the new apartment each time it rained. Knowing that houses in the area frequently shift due to poor soil quality, O'Callaghan was familiar with such issues: in fact, just prior to patching the apartment's walls and roof, the main house required comparable repairs. Additionally, in 1994 (one year before the apartment build-out), O'Callaghan hired a local contractor to "re-level" the home in an effort to prevent similar cracking and shifting in the future.

         ¶7. O'Callaghan initially patched any issues which occurred in the apartment, but the problems quickly proved to be more than cosmetic. Eventually the home's roof caved in and O'Callaghan hired a professional carpenter to repair the damage. However, even that work was nothing more than a temporary solution. By 2008, the carport-apartment had become uninhabitable: the roof fully caved in, the walls began to separate, and hazardous amounts of black mold formed.

         ¶8. In 1996, after building the apartment and making several repairs to the home, O'Callaghan noticed that the ditch Tupelo had created in 1992 was eroding-becoming wider and deeper with each heavy rain. Convinced the erosion and the home damage were related, O'Callaghan contacted city officials and requested they reconstruct the ditch to prevent future issues.[3] Between his initial contact with the city and late 2004, a variety of Tupelo officials-including several councilmen, the city engineer, and two mayors-visited the property to evaluate the damage and address O'Callaghan's grievances. During visits to the property in the early 2000s, the city refused to remedy the erosion issue, noting that, unlike other ditches around the neighborhood, the O'Callaghan ditch was on private property. Accordingly, since 1992, Tupelo has not completed any other projects on the property aside from growth removal on the drain.

         ¶9. Aggrieved, O'Callaghan filed suit in 2008-more than ten years after he first recognized the ditch was causing damage to his home. Following a period of discovery, Tupelo filed a motion for summary judgment based largely on a lack of evidence to support the idea that the structural damage to the property was caused by the ditch. Because his expert witness-an engineer-changed his opinion, noting that he did not think the damage to the home was proximately caused by the drainage pipe or ditch, O'Callaghan voluntarily dismissed his case without prejudice.

         ¶10. Having experienced four additional years of rainfall and erosion, O'Callaghan hired another engineer in 2012 to evaluate the ditch and the continuing damage to his home. The engineer (the third to evaluate the issues since 2004) opined that the ditch is, in fact, the cause of the damage to the home, and with each heavy rain, new damage occurs. The O'Callaghans allege that, without the information from this engineer, they did not know nor could they have known of the existence of an actionable claim against Tupelo.

         ¶11. Relying on the engineer's report, O'Callaghan and his wife filed the instant lawsuit. Aside from new allegations that the resultant cracks, roof issues, and leaks created a scourge of black mold in the home, exacerbating existing pulmonary issues for the couple, the complaint largely avers the same claims as the 2008 suit. The O'Callaghans again seek relief for property damage under the Takings Clause of the Mississippi Constitution, but with the added claim of personal injuries resulting from the black mold.

         ¶12. Tupelo again sought summary judgment, noting that damages for personal injuries are not recoverable in a takings claim and that the lawsuit, in its entirety, is time-barred. The trial court denied the motion, finding no existing Mississippi caselaw ruling on the nature of damages available under the Takings Clause, and ruling that there exists a genuine issue of material fact as to when the O'Callaghans knew or should have known about the potential claim or cause of action against Tupelo.

         ¶13. As advised by the trial court, the City of Tupelo presents four issues on interlocutory appeal:

I. What does the language "without limitation or qualification" in Article 3, Section 17 of the Mississippi Constitution mean? More specifically, does the language mean that takings claims are not subject to a limitations period?
II. If a takings claim is subject to a limitations period, under the facts of this case, does each heavy rain constitute a separate taking? Alternatively, under the facts of this case, has the cause of action continued unabated since 1992?
III. Under Article 3, Section 17 of the Mississippi Constitution, are damages for personal injuries recoverable?
IV. Is the Plaintiff's lawsuit barred by the applicable limitations period?

         ¶14. Because issues I and IV are closely aligned, we combine them into one issue and address them first.

         STANDARD OF REVIEW

         ¶15. When evaluating a trial court's grant or denial of summary judgment, this Court applies a de novo standard of review. Crawford Logging, Inc. v. Estate of Irving, 41 So.3d 687, 689 (Miss. 2010). Summary judgment is properly granted when "the pleadings, depositions, answers to interrogatories and admissions on file . . . show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." M.R.C.P. (56)(c). The moving party bears the burden of proving that no genuine issue of material fact exists; though "[i]f there is doubt as to whether or not a fact issue exists, it should be resolved in favor of the non-moving party." Young v. Meacham, 999 So.2d 368, 371 (Miss. 2008) (quoting Aetna Cas. & Sur. Co. v. Berry, 669 So.2d 56, 70 (Miss. 1996)); see also Ratliff v. Ratliff, 500 So.2d 981, 981 (Miss. 1986).

         LAW AND ANALYSIS

         ¶16. The O'Callaghans argue that the law is clear: the Takings Clause under Article 3, Section 17 of the Mississippi Constitution is to be interpreted "without limitation or qualification, " making their claim immune from any statute of limitations imposed by the Legislature. Further, their claim is continuing in nature, as each time a heavy rain falls, new damage to their property occurs, creating an ongoing and repetitive taking. Finally, the harm inflicted on the O'Callaghans extends to personal injuries in the form of respiratory issues created by the growth of black mold. The O'Callaghans assert that this Court's decision in City of Vicksburg v. Herman, 72 Miss. 211, 16 So. 434 (1894), serves to cover all damages in an action under the Takings Clause, filed at any time, regardless of character, and including those for personal injuries.

         ¶17. Tupelo disagrees, arguing that the court's denial of summary judgment was erroneous and that this Court should reverse the decision. Tupelo claims first that no damages are available to a plaintiff in a Takings Clause action other than (1) compensation for the fair market value of the property taken and (2) compensation for damage to the remaining property. Additionally, they assert that the limitations period provided by Section 15-1-49 of the Mississippi Code bars this lawsuit. See Miss. Code Ann. § 15-1-49 (Rev. 2012). Alternatively, Tupelo argues that a prescriptive easement, which matured to the ten-year requirement in 2002, also bars the O'Callaghans' claims.

         ¶18. Having denied Tupelo's motion for summary judgment, the trial court determined that the following issues should be addressed by this Court through interlocutory appeal, to guide further proceedings in the instant action and future similar cases.

         I. What does the language "without limitation or qualification" in Article 3, Section 17 of the Mississippi Constitution mean? More specifically, does the language mean that takings claims are not subject to a limitations period? Further, if they are subject to a limitations period, is the plaintiff's lawsuit barred?

         ¶19. In an effort to address effectively the parties' arguments, this issue is approached in three parts, beginning with the interpretation of the language quoted from this Court's decision in City of Vicksburg v. Herman as it relates to Article 3, Section 17 of the Mississippi Constitution of 1890.[4] This section provides that:

Private property shall not be taken or damaged for public use, except on due compensation being first made to the owner or owners thereof, in a manner to be prescribed by law; and whenever an attempt is made to take private property for a use alleged to be public, the question whether the contemplated use be public shall be a judicial question, and, as such, determined without regard to legislative assertion that the use is public.

Miss. Const. art 3, § 17 (1890). To refute the City's claim that Section 15-1-49[5] of the Mississippi Code governs the limitations period for takings claims under the Mississippi Constitution, the O'Callaghans cited City of Vicksburg v. Herman, in which this Court interpreted the scope and application of Article 3, Section 17. Herman, 16 So. at 434-435. In that 1894 decision, this Court interpreted the newly revised Constitutional provision, concentrating on its first line, which provides that "private property shall not be taken or damaged for public use, except on due compensation being first made to the owner or owners thereof, in a manner to be prescribed by law." Herman, 16 So. at 434 (emphasis in original). This Court noted first that, while the majority of this section could be found in previous editions of our state's Constitution, the words "or damaged" were added in 1890 to inhibit the conversion of private property to public use without due compensation, sufficiently guarding the rights of the private person. Id. at 434, 435. The addition of these two words expanded the protections afforded to property owners under the state's Constitution by ensuring compensation for any damage to the property resulting from "works for public use." Id.

         ¶20. In interpreting the incorporation of this small (but important) phrase to Article 3, Section 17, this Court explained that, prior to the 1890 revision, "merely consequential injuries, resulting from the loss or impairment of some rights incident to the use or enjoyment, [without] invasion to the property itself, were not covered by the constitutional prohibition" against the taking of private property. Id. at 434. But after the 1890 revision, a landowner became "secured in his property, and his use and enjoyment of his property. . . entit[ling him] to due compensation for, not [just] the taking [. . .] of his property for public use, but for all damages to his property that may ...


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