JEFFREY W. BATES, J.
This is a condemnation case. Carroll Electric Cooperative Corporation (Carroll Electric) filed a petition to condemn a right-of-way for an electric transmission and distribution line across properties owned by two couples: Ralph and Mary Lambert; and William Darch and his wife, Frances Bon Tempo (collectively, Landowners).
On appeal, Carroll Electric presents five points for decision. Because our decision on Points I and II resolves the entire appeal, Points III-V will not be addressed. In Point I, Carroll Electric contends the trial court erred in dismissing the petition because § 394.080.1(11) RSMo (2000) authorizes Carroll Electric to condemn property for "constructing or operating electric transmission and distribution lines or systems" and the communication lines are an essential part of the transmission and distribution system. In Point II, Carroll Electric contends the trial court erred in dismissing the petition and awarding attorney's fees pursuant to § 523.256. Carroll Electric argues that the court misapplied the law when it determined that Carroll Electric failed to comply with a good faith negotiation requirement in that statute. Because both points have merit, the summary judgment is reversed. The cause is remanded for further proceedings consistent with this opinion.
"As a general rule, review of the trial court's ruling on a motion to dismiss
Carroll Electric is a member-owned rural electric cooperative that serves parts of Northwest Arkansas and Southwest Missouri. Carroll Electric's system has transmission lines that feed its substations, and there are distribution lines that run from the substations to its members. Carroll Electric has two substations in the Shell Knob, Missouri area.
Carroll Electric sought to condemn an easement for a new 69,000 volt transmission line to run from its Holiday Island substation to its Viola substation. Landowners own land at the end point of the line.
Carroll Electric intended to create a "loop feed" with which to improve reliability of its system in the Shell Knob area. This loop feed would meet the increasing demand for power in the area and thus better serve its members. Currently, the Holiday Island and Viola substations operate on radial feeds, which have one source of electricity. When an outage occurs or maintenance needs to be done, the substation must be de-energized to work on it. A loop feed, on the other hand, would result in fewer outages by enabling Carroll Electric to take one line out of service
The proposed line would also cross Table Rock Lake, which requires a permit from the U.S. Army Corps of Engineers (the Corps). The Corps' safety concerns about the line included potential hazards to airplane traffic and parasailers on the lake. Carroll Electric employed Finley Engineering (Finley) to address engineering issues and work with the Corps. Bryce Barton (Barton) was a Finley engineer working on the project. According to Barton, the crossing points were chosen through "a collaborative effort that began with working with [the Corps] to determine an acceptable crossing site of the lake." It "took a long time to identify a site that was acceptable to them as well as us." Preliminary consultation with [the Corps] had begun in 2006. Carroll Electric submitted its final site plan in the summer of 2010. The Corps approved the project in late 2010 or early 2011.
In early 2010, Finley contacted Landowners about the project on behalf of Carroll Electric. In August 2010, Finley mailed 60-day notices of "Intended Acquisition for Electric Line Easement" to Landowners by certified mail pursuant to § 523.250. The notices described an "improvement project" that would "include the installation of a 69,000 volt transmission line that will improve the reliability of the electrical service in the area." Barton testified that, within 30 days after the notice was mailed, Finley received no written request from Landowners to relocate the easement, as provided under § 523.265.
In December 2010, Carroll Electric mailed an "Offer Letter" to each of the Landowners, offering to purchase their respective easements for a stated price. Attached to the Offer Letter was a proposed right-of-way easement, which as to each Landowner was described in part as:
(Emphasis added.) Each Offer Letter also included a legal description of the proposed easement, a drawing depicting the location of the easement, and a "Summary Appraisal Report."
In January 2011, Carroll Electric filed this action. The condemnation petition alleged that Carroll Electric was exercising the power of eminent domain granted by § 394.080.1(11) and § 523.010 RSMo (2000) "to condemn private property for the construction upon and use of such property" for the purpose of "the installation of a sixty-nine (69) KV transmission line with an electric distribution line to improve the reliability of electric service for the Shell Knob, Missouri area." The petition further alleged that Carroll Electric had attempted to negotiate with Landowners as to the proper compensation to be paid and that Carroll Electric had "made a good faith effort to reach a compromise with [Landowners] on the price for the property, and all required notices and prerequisites have been met prior to the filing of this Petition in Condemnation as required by law." Landowners denied these allegations.
In April 2011, a hearing was held, at which Carroll Electric called several witnesses, including Barton. With respect to
Landowners offered no evidence, but instead orally moved to dismiss the proceedings. They argued that Carroll Electric had statutory authority "to condemn the power line" but that it had sought something it was not entitled to because it had "essentially tried to slip in this communications on all of the action."
After taking the matter under advisement, the court dismissed the condemnation petition without prejudice. The court noted the language of the proposed easement for "communication purposes" and explained that § 394.080.1(11) RSMo (2000) grants the power of eminent domain to cooperatives for "constructing or operating electric transmission and distribution lines or systems. However no power of eminent domain is granted for `communication purposes.'"
The court also decided that, although Carroll Electric furnished Landowners with the Summary Appraisal Reports, the reports failed to comply with statutory appraisal requirements. The court determined that Carroll Electric failed to prove "that the appraisals rendered on behalf of [Carroll Electric] were performed by state-licensed or state-certified appraisers" using "generally accepted appraisal practices" as required by § 523.256 to show good faith negotiations. Accordingly, the court decided that "not only has [Carroll Electric] exceeded its authority as set forth in 394.080 RSMo but also has failed to meet the requirements of 523.253 RSMo. and 523.256 RSMo as outlined hereinbefore and as a result of such failure, the Court must find that good faith negotiations have not occurred." The court dismissed the condemnation petition without prejudice. In addition the court awarded Landowners their attorney's fees and costs pursuant to the provisions of § 523.256. The dismissal without prejudice and the respective awards of Landowners' attorney's fees and costs were included in a second amended judgment, from which Carroll Electric appeals. Additional facts necessary to the disposition of the case are included below as we address Carroll Electric's points of error.
In Carroll Electric's first point, it contends the trial court misapplied the law by dismissing the condemnation petition on the ground that § 394.080.1(11) grants no power of eminent domain for "communication purposes." Section 394.080.1 provides that "[a] cooperative shall have power:... [t]o exercise the power of eminent domain in the manner provided by the laws of this state for the exercise of that power by corporations constructing or operating electric transmission and distribution lines or systems[.]" § 394.080.1(11)
The reference in § 394.080.1(11) to Missouri laws governing the exercise of condemnation power by "corporations constructing or operating electric transmission and distribution lines or systems" invokes the provisions of § 523.010 governing, inter alia, condemnation of private property by rural electric cooperatives. In relevant part, that statute states:
§ 523.010.1 RSMo (2000). "[T]he power of eminent domain extends to the acquisition of the necessary land for each and every essential part of the project." Union Electric Co. v. Jones, 356 S.W.2d 857, 861 (Mo.1962).
In Union Electric, our Supreme Court addressed a similar argument that an electric company was taking land "for purposes not included in the statutes." Id. There, Union Electric sought to condemn Jones' land for a planned hydroelectric generating facility. Id. at 858. The hydroelectric facility included a dam, which would form a lower pool, and an upper pool at a substantially higher elevation. Id. The operation was to be controlled electronically from St. Louis. Id. at 859. With respect to Jones' land, only about half would be flooded. Id. at 861. Union Electric nevertheless sought to condemn all of it. Id. On the part that would not be flooded, Union Electric planned to install a high-voltage transmission line "and a communication or control cable carrying 16 to 20 circuits" to be "used in the remote control operation of the facilities." Id. The petition alleged that Union Electric needed the balance of the land "for impounding water thereon, flooding the said real estate, and the protection of the highhead pumped storage electric generating stations, including all the major components thereof, and the necessary security measures therefor." Id.
Jones argued that Union Electric could not condemn land for "protection" or for the "necessary security measures" because there was no statutory power to condemn for those purposes. Id. Our Supreme Court rejected that argument for the following reason:
Id.
Based upon the facts which we must assume to be true for the purpose of reviewing this summary judgment, we reach the same conclusion here. Barton testified that "communication between substations is essentially critical for the operation of transmission [and] distribution networks." By ruling that Carroll Electric "exceeded its authority" because "no power of eminent domain is granted for `communication purposes[,]'" the trial court would effectively preclude Carroll Electric from installing and using those lines for its own communications to operate its electrical system. Assuming the facts presented at the evidentiary hearing are true, Carroll Electric's condemnation power under § 394.080.1(11) and § 523.010 RSMo (2000) is broad enough to permit it to condemn an easement for communication lines appurtenant to its electric transmission and distribution system. The court misapplied the law in reaching a contrary conclusion.
On appeal, Landowners concede that Carroll Electric may condemn an easement that includes the right to install "appurtenant communication lines" to operate its electrical system. Landowners argue, however, that Carroll Electric exceeded its statutory powers to condemn in this case. According to Landowners, the easement to permit "joint use or occupancy" by others for "communication purposes" has "no connection whatever" to Carroll Electric's stated purpose to provide electricity. Landowners complain that "[t]he plain reading of the easement Carroll Electric sought to condemn means Carroll Electric could allow ATT, Centurylink, Mediacom, Verizon, or any entity in the telecommunication business to utilize Carroll Electric's easement for `communication purposes.'"
In response, Carroll Electric argues that the joint occupancy provision in these easements allow other electric cooperatives to buy and sell electricity to each other.
Section 523.283 states:
Id. (emphasis added). Thus, § 523.283 provides specific protections and remedies to the landowner in the event expanded use of the condemned property takes place. See, e.g., Sterbenz v. Kansas City Power and Light Co., 333 S.W.3d 1 (Mo. App.2010) (discussing a provision of § 523.283 in a trespass action by landowners against utility after an electric line was installed on property where utility lacked an easement). Here, the 60-day notices described the particular use of the proposed easement for "the installation of a 69,000 volt transmission line that will improve the reliability of the electrical service in the area." Likewise, Carroll Electric stated in its condemnation petition that Landowners' property was sought for "the installation of a sixty-nine (69) KV transmission line with an electric distribution line to improve the reliability of electric
In Carroll Electric's second point, it contends that the trial court erred by dismissing the condemnation petition and awarding Landowners attorney's fees and costs on the ground that good faith negotiations did not occur as required by § 523.256. The following additional facts are necessary to discuss this point.
A "Summary Appraisal Report" was attached to each of the Landowners' Offer Letters. Each Summary Appraisal Report generally included the following: the identity of the fee owners; the owners' mailing address; the location of subject property; a description of subject property; a description of the area of the whole, area of acquisition, and area of remainder; a description of the basis for the condemned land's estimated value; the purpose of the appraisal; its intended use; its intended users; the property rights appraised; the effective date; date prepared; scope of work; highest and best use; exposure time; discussion of severance damage; discussion of enhanced value; history; sales comparison approach; and subject photographs, which included an aerial photo showing easement area. Although the reports referred to a legal description and survey of each property, neither was attached to the report.
At the hearing, Landowners' counsel argued that Carroll Electric "didn't send an appraisal. They sent part of an appraisal...." When Landowners' counsel questioned
In dismissing the condemnation petition without prejudice, the trial court found that Carroll Electric furnished Landowners with the "Summary Appraisal Reports." The court decided, however, that the reports failed to comply with statutory appraisal requirements. The court explained that:
The court concluded that "[a]lthough [Carroll Electric] has met many of the requirements set forth in Sections 523.253 RSMo. and 523.256 RSMo.[,]" it failed to comply with the appraisal requirements "as outlined hereinbefore and as a result of such failure, the Court must find that that good faith negotiations have not occurred."
Carroll Electric contends the trial court erred by dismissing the condemnation petition on the ground that Carroll Electric failed to comply with statutory requirements for appraisals. Carroll Electric argues that: (1) § 523.253.2(1) permits a condemning authority to provide either an appraisal or "an explanation with supporting financial data for its determination of the value of the property for purposes of the offer"; (2) the trial court ignored the alternative method of showing support for the offer; and (3) the court misapplied the law in focusing only on the appraisal requirements and concluding, on that basis alone, that Carroll Electric did not engage in good faith negotiations as required by § 523.256. Assuming the facts presented at the evidentiary hearing are true, we agree.
Section 523.256, which sets out the requirements for what constitutes good faith negotiations, states:
Id. (emphasis added). Thus, § 523.256(2) permits a condemning authority to fulfill its obligation of providing an explanation of the basis for its offer by either of the methods set forth § 523.253.2.
Section 523.253 states:
Id. (emphasis added). Thus, § 523.253.2 requires the condemning authority to provide the property owner with either "an appraisal," which must be "made by a state-licensed or state-certified appraiser using generally accepted practices," or "an explanation with supporting financial data for its determination of the value of the property for purposes of the offer[,]" which is not subject to the same appraisal requirements. Id. Similarly, § 523.256(2) provides that, if the condemning authority provides the latter, it satisfies the good faith valuation requirement if its "offer is no lower than the amount provided in the basis for its determination of the value of the property."
Here, the trial court specifically found that Carroll Electric furnished Landowners with the "Summary Appraisal Reports," not "appraisals," yet the court applied the statutory requirements for appraisals.
Landowners concede that, in the event this Court determines "the trial court erred in finding Carroll Electric did not engage in good faith negotiation under RSMo. § 523.256, the trial court has no authority to award attorneys' fees and costs under § 523.256." Accordingly, we similarly conclude that the trial court erred in awarding attorney's fees and costs to Landowners pursuant to § 523.256. Point II is granted.
The trial court erred by dismissing Carroll Electric's condemnation petition without prejudice and by awarding attorney's fees and costs to Landowners. Therefore, we reverse the second amended judgment. The cause is remanded for proceedings consistent with this opinion.
NANCY STEFFEN RAHMEYER, J., and DON E. BURRELL, C.J., concur.
Cramer, 291 S.W.3d at 339 (citations omitted). Among the exceptions, the common factor "was that the plaintiffs could not maintain their actions in the court where the action was filed if the reason for the dismissal was proper." Doe, 13 S.W.3d at 676; Cramer, 291 S.W.3d at 339. Here, Carroll Electric maintains, and we agree, that an amended or new petition would be subject to the same defense and Carroll Electric could not maintain the action if the reason for dismissal was proper. Therefore, the dismissal without prejudice had the practical effect of terminating the litigation and is appealable. See Chromalloy, 955 S.W.2d at 3-4. Moreover, the judgment for attorney's fees and costs is appealable as a money judgment. See, e.g., Planned Indus. Expansion Authority of Kansas City v. Ivanhoe Neighborhood Council, 316 S.W.3d 418, 428 (Mo.App.2010) (appeal from judgment awarding attorney's fees under § 523.256).