JACOBS, Justice:
By Opinion dated July 22, 2013, this Court ordered the dismissal without prejudice of a condemnation proceeding instituted in the Superior Court by the plaintiff-below/appellee, the State of Delaware Department of Transportation ("DelDOT"), against the defendants-below/appellants, Jack and Mary Ann Lawson (the "Lawsons"). Thereafter, the Lawsons moved in the Superior Court proceeding for an award of litigation expenses and costs, which the Superior Court denied by order dated September 25, 2013. The Lawsons appeal from that order. They claim entitlement to reimbursement for the litigation expenses they incurred by virtue of the condemnation proceeding, under both the Real Property Acquisition Act, and the
This appeal requires us to construe, for the first time, certain language in 29 Del. C. § 9503, the reimbursement provision of the Real Property Acquisition Act (the "Act"). We hold that that provision requires reimbursement for litigation expenses related to a condemnation proceeding where a court determines that the subject property cannot be acquired by the governmental entity's particular exercise of its underlying eminent domain power in that specific proceeding. Accordingly, we determine that the Superior Court erred by denying the Lawsons' motion for litigation expenses under 29 Del. C. § 9503. We also conclude, however, that the Superior Court correctly determined that the Lawsons were not entitled to litigation expenses under the bad faith exception to the American Rule. Finally, we hold that the Superior Court erred by not addressing the Lawsons' application for costs.
We therefore affirm in part, reverse in part, and remand the case to the Superior Court to determine the litigation expenses and costs to which the Lawsons are statutorily entitled.
The Lawsons own approximately ten acres of real property located at 323 Strawberry Lane in Middletown, Delaware.
Beginning in 2010, DelDOT sought to acquire approximately 1.51 acres of the Lawsons' property
In December 2010, DelDOT obtained an appraisal of the Lawsons' property that valued the fee interest at $130,000.
In September 2011, DelDOT offered the Lawsons $133,100 for the property acquisition and the temporary construction easement.
On January 18, 2012, DelDOT filed a condemnation action in the Superior Court.
By Opinion dated July 22, 2013, this Court reversed the Superior Court judgment, vacated the Superior Court orders, and remanded with instructions to dismiss the condemnation action without prejudice.
On September 12, 2013, the Lawsons moved, in the Superior Court, for an award of litigation expenses, claiming that they were entitled to reimbursement for their expenses under both 29 Del. C. § 9503
The Lawsons appealed to this Court from the Superior Court's September 25 order. For the reasons next discussed, we reverse in part the Superior Court judgment and remand the case for further proceedings.
The Lawsons advance three claims of error on this appeal. First, they claim that the Superior Court erred by denying the Lawsons' motion for an award of litigation expenses under 29 Del. C. § 9503. That claim requires this Court to determine whether § 9503, which applies where there is a "final judgment ... that the real property cannot be acquired by condemnation," requires that litigation expenses be awarded in this case. More specifically, we must construe whether the statutory language "cannot be acquired by condemnation" plainly means (as the Lawsons contend) "cannot be acquired by this condemnation proceeding." Second, the Lawsons claim that the Superior Court erred by not awarding them litigation expenses under the bad faith exception to the American Rule. That claim presents the issue whether — as the Lawsons contend — DelDOT initiated the underlying condemnation proceeding in bad faith. Third, the Lawsons claim that the Superior Court erred by not addressing whether costs are awardable under 10 Del. C. §§ 5101 and 5104. That claim requires us to determine whether the Superior Court erred by not explicitly addressing the cost issue when it denied the Lawsons' motion.
This Court reviews a trial court's interpretation of a statute de novo.
We first hold that the plain meaning of 29 Del. C. § 9503 requires that the Lawsons be reimbursed for the litigation expenses they incurred by reason of the condemnation proceeding. Second, we determine that the Superior Court did not abuse its discretion by finding that the Lawsons were not entitled to litigation expenses under the bad faith exception to the American Rule. Lastly, we conclude that the Superior Court abused its discretion by not addressing the Lawsons' application for costs.
The Superior Court held that the reimbursement provision of the Act had not been triggered, because the August 7, 2013 dismissal of the condemnation action was not a "final judgment" that the "property [was] not subject to condemnation for the purpose stated by [DelDOT]."
The Lawsons do not claim that DelDOT "abandoned" the proceedings. Accordingly, whether § 9503 entitles the Lawsons to reimbursement of their litigation expenses turns on the meaning of the language "final judgment ... that the real property cannot be acquired by condemnation."
The Delaware General Assembly's statutory use of the term "condemnation" clearly
Section 9503 clearly contemplates that the reimbursement provision applies in the context of a single condemnation proceeding. That provision begins by referencing "a condemnation proceeding" — meaning a particular, discrete exercise of the governmental entity's eminent domain power. And, throughout § 9503, the terms "condemnation proceeding," "condemnation," and "proceeding" are used interchangeably.
Here, the condemnation proceeding instituted by DelDOT was dismissed because this Court found that DelDOT had inexcusably failed to comply with the Act's requirements when DelDOT attempted to take the Lawsons' property. That is, DelDOT had improperly exercised its substantive eminent domain power. For purposes of the reimbursement statute, that dismissal constituted a final judgment in the Superior Court proceedings commenced on January 18, 2012. That the dismissal was "without prejudice" served only to preserve DelDOT's right to attempt, in a later, separate proceeding, to acquire the Lawsons' property through a proper exercise of its eminent domain power. That the dismissal was "without prejudice" did not alter the finality of the judgment entered in that particular condemnation proceeding.
We therefore reverse the Superior Court judgment that the Lawsons were not entitled to be reimbursed for their litigation expenses under 29 Del. C. § 9503. The case will be remanded for a determination by that court of the "reasonable attorney, appraisal and engineering
DelDOT advances three arguments to support the Superior Court's interpretation of 29 Del. C. § 9503. First, DelDOT argues that § 9503 plainly means that reimbursement is required only where a court has rendered a final judgment that the condemning agency may never condemn the subject property (i.e., the condemning agency lacks the underlying substantive eminent domain power). Second, DelDOT argues that Delaware should follow case law from other jurisdictions (both federal and state) that supports the Superior Court's interpretation. Finally, DelDOT urges this Court to strictly construe § 9503 because it is in derogation of the common law. None of those arguments is persuasive.
To reiterate, DelDOT argues that the plain meaning of the reimbursement provision of the Act is that it is triggered only where a court has entered a final judgment that the subject property cannot be acquired in any condemnation proceeding. In essence, DelDOT is urging that the relevant language means "cannot be acquired by eminent domain," i.e., where the governmental agency is found to lack the substantive power to condemn the property. That argument is unavailing. As Delaware's particular statutory usage and the dictionary definitions of "condemnation" and "eminent domain" show, those two terms are neither analogous nor interchangeable.
DelDOT next argues that this Court should adopt the interpretation used by courts of other jurisdictions (particularly federal courts) when construing similar statutes. This argument is colorable. The Real Property Acquisition Act was adopted in 1972 in response to the Federal Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970,
Even so, DelDOT's argument fails. DelDOT relies primarily upon the Ninth Circuit decision in United States v. 4.18 Acres of Land.
Finally, DelDOT argues that because § 9503 derogates the common law American Rule, this Court must construe that provision strictly, and adopt the Superior Court's interpretation.
The Lawsons' second claim of error is that the Superior Court abused its discretion by denying their motion for litigation expenses under the bad faith exception to the American Rule that each party pays its own litigation expenses.
The Lawsons argue that DelDOT brought its condemnation action in subjective bad faith, based on the finding in this Court's July 2013 Opinion that DelDOT clearly violated the Act when it failed to establish a purchase price amount "reasonably believed" to be just compensation.
The Lawsons' final claim of error is that the Superior Court erred by not awarding costs or even addressing the issue. We are constrained to agree. It is well established that a trial judge must state the reasons for his or her decision on an adjudicated matter.
The Lawsons contend that they are entitled to reimbursement for costs under 10 Del. C. §§ 5101 and 5104, because the condemnation proceeding was dismissed. Those cited statutes are general provisions that address the issue of costs where a party prevails in an action at law.
For the foregoing reasons, we affirm in part and reverse in part the Superior Court judgment. We remand the case to the Superior Court for further proceedings in accordance with this Opinion. Jurisdiction is not retained.
10 Del. C. § 5101 provides:
Section 5104 provides that "[i]f final judgment is given for the defendant in a civil action, which is in the name of the State for the use of any person or corporation, judgment for costs shall be given against such person or corporation."