Wintergreen Group, LC v. Utah Department of Transportation

1 This appeal is the offspring of several condemnation
lawsuits that merged into one dispute between the Utah Department
of Transportation (UDOT) and the Wintergreen Group, LC. After
UDOT brought three separate condemnation actions on different
parts of Wintergreen's land, Wintergreen brought a fourth inverse
condemnation action, alleging state and federal takings claims.
Wintergreen contended that by filing three separate condemnation
actions, UDOT improperly fragmented Wintergreen's land holdings
and left Wintergreen at risk of receiving less compensation for
the serial takings than it would have received had UDOT brought a
single condemnation action.

2 The district court saw merit in Wintergreen's concerns
and consolidated the three separate condemnation actions into
one. But the district court also dismissed Wintergreen's inverse
condemnation suit. It reasoned that the consolidated condemnation suit would provide all the relief guaranteed by the
state and federal constitutions. We find that the district
court's dismissal of Wintergreen's inverse condemnation action
based on preemption reasoning was in error. We therefore vacate
the dismissal and remand for further proceedings.

BACKGROUND

3 The Wintergreen Group is a Utah-based company that owns
several parcels of land in the city of Tooele, Utah.
Wintergreen's property is located on both the east and west sides
of State Road 36 (SR-36). Together, the parcels total
approximately 121 acres. Wintergreen intended to use these
separate parcels to develop the North Town Shopping Center, which
it envisioned as an integrated economic unit. Sometime prior to
2004, UDOT began a project to widen SR-36 in Tooele and to
conduct ancillary construction and improvements on and around
Wintergreen's land.

4 During March and April 2004, UDOT filed three actions
to acquire by condemnation small portions of land from several of
the parcels in Wintergreen's collective land holdings. The
district court granted UDOT an Order of Immediate Occupancy in
each case, and work commenced. These three condemnation actions
reduced the plaintiff's land holdings by just over four and onehalf
acres and burdened the east side fourteen-acre parcel with
temporary and permanent easements.

5 Approximately one year later, Wintergreen filed an
inverse condemnation action against UDOT, alleging six causes of
action. The first three causes of action were brought under 42
U.S.C. § 1983 for alleged violations of the Takings Clause of the
Fifth Amendment to the United States Constitution. The final
three causes of action alleged violations of the takings
provision of the Utah Constitution.

6 UDOT responded to the lawsuit with a motion to dismiss.
It argued that the inverse condemnation action was a mere
duplication of its direct condemnation suits. UDOT also argued
that in addition to providing a functionally identical forum to
obtain compensation, the direct condemnation actions provided
administrative remedies that Wintergreen was required to exhaust
before commencing its inverse condemnation suit. Finally, UDOT
challenged the § 1983 actions on the ground that the State was
not a person that can be sued under § 1983.

7 The district court granted UDOT's motion to dismiss.
The district court found that the state and federal inverse
condemnation actions were inappropriate in this case because the Utah statutory condemnation scheme provided all the remedies that
would be available in the inverse condemnation action. The court
explained that "[t]he proper procedural action to force the
government to pay just compensation for damages to the entire
property and not just the three individual parcels is to
consolidate the three condemnation actions," which the court did
on its own motion. The case now comes before us on direct
appeal.

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9 The district court erred in granting UDOT's motion to
dismiss because the dismissal was premature. The central premise
of the district court's ruling was that UDOT's consolidated
direct condemnation action functionally absorbed and preempted
the claims advanced by Wintergreen in its inverse condemnation
action. Wintergreen disputes this, alleging that its state and
federal constitutional claims offer different and more
comprehensive remedies than those available under Utah's
statutory scheme for direct condemnation. We agree with
Wintergreen that in the setting of a motion to dismiss,
Wintergreen should be permitted to develop its case to show, if
it can, the independent viability of its constitutional claims.

10 Under federal law, the right of a property owner to
pursue a takings or inverse condemnation claim does not generally
ripen until the landowner has actually been denied just
compensation. Williamson County Reg'l Planning Comm'n v.
Hamilton Bank, 473 U.S. 172, 194-95 (1985). If the State has "an
adequate process for obtaining compensation, and if resort to
that process ‘[yields] just compensation,' then the property
owner ‘has no claim against the Government' for a taking." Id.
(alteration in original) (quoting Ruckelshaus v. Monsanto Co.,
467 U.S. 986, 1013, 1018 n.21 (1984)). Consequently, a property
owner's constitutional just compensation claim will not ripen
"until it has used the procedure and been denied just
compensation." Id. at 195 (citing Ruckelshaus, 467 U.S. at 1013,
1018 n.21). Thus, where a direct condemnation action has been
filed, an inverse condemnation claim will not be ripe until the direct condemnation action has ended because, as long as the
direct condemnation action is active, there is a very real
possibility that the landowner will receive just compensation
from the government. We find the ripeness analysis of Williamson
County persuasive.

11 Williamson County, however, does not foreclose a
property owner from challenging as defective either the adequacy
of the condemnation process or the compensation that the process
permits. Presumably, such challenges could be made through a
counterclaim in a direct condemnation action or through an
independent lawsuit. In fact, the Williamson County court
implicitly acknowledged that state codifications of the express
constitutional right to just compensation may fall short of
affording property owners their full complement of constitutional
protections. Id. at 196-97 ("Respondent has not shown that the
inverse condemnation procedure is unavailable or inadequate, and
until it has utilized that procedure, its taking claim is
premature."). Accordingly, if the constitutional claims of a
landowner suggest that the relevant direct condemnation procedure
is "unavailable or inadequate" or that the remedies it offers are
incomplete, the claims may sidestep ripeness challenges. Id. In
our view, this is what Wintergreen's pleadings have accomplished
here.

12 Wintergreen sufficiently alleged six claims for inverse
condemnation. In the face of those sufficiently pleaded claims,
the district court erred when it dismissed the claims based
solely on the fact that UDOT had already filed direct
condemnation actions, which had been consolidated to more
accurately account for severance damages. See Ivers v. UDOT,
2007 UT 19, 8, 154 P.3d 802 (defining severance damages as
damages caused when the taking of a portion of a larger parcel of
property results in injury to the remaining uncondemned
property).

13 The time will doubtless come when Wintergreen will be
put to the test of articulating fully how Utah's statutory
condemnation scheme is less than fully congruent with federal and
state constitutional guarantees of just compensation. That time
was not, however, at the stage of Wintergreen's initial
pleadings.

14 We are further persuaded that the district court's
dismissal of Wintergreen's constitutional counterclaim was in
error because the underlying premise of that decision--that
Utah's direct condemnation statute functionally preempted
Wintergreen's constitutional claim--is suspect. A constitutional
cause of action rooted in the organic law of our state is presumptively superior to and must displace any statutory
iteration that either conflicts with it or gives it less than
full effect. Owing to its different lineage, a constitutional
cause of action can never be preempted by statute, regardless of
how fully the statute honors the contours of the constitutional
claim. Thus, even if Utah's direct condemnation statute provides
the full complement of procedural and substantive rights afforded
a property owner by the constitution, that statute cannot be said
to have preempted the constitutional claim. Rather, any
codification of a constitutional cause of action labors in the
service of a constitutional cause of action by setting out the
process by which those entitled to constitutional relief may
acquire it.

15 We understand that some support exists for the idea
that a sufficiently comprehensive statute, which provides an
enforcement mechanism for an underlying constitutional right, can
preempt a parallel § 1983 action based on the underlying
constitutional right itself. See Middlesex County Sewerage Auth.
v. Nat'l Sea Clammers Ass'n, 453 U.S. 1, 20 (1981). But
preemption is a conceptually viable notion in this setting
because the preemption contest is between two statutes--the
enforcing statute and § 1983--and not a direct clash between a
statute and the constitutional claim. Regardless, it is clear
that to extinguish a § 1983 claim which is based on an underlying
constitutional right, a defendant must establish that by passing
a comprehensive statutory scheme "Congress has expressly
withdrawn" the underlying constitutional remedy. Golden State
Transit Corp. v. City of Los Angeles, 493 U.S. 103, 107 (1989).
"[T]he statutory framework must be such that ‘allowing a
plaintiff' to bring a § 1983 action ‘would be inconsistent with
Congress' carefully tailored scheme.'" Id. (quoting Smith v.
Robinson, 468 U.S. 992, 1012 (1984)). Moreover, the presence of
a comprehensive statutory scheme, by itself, "is not necessarily
sufficient to demonstrate that Congress intended to foreclose a
§ 1983 remedy." Id. at 106. This difficult burden signals to us
that the preemption of claims based on underlying constitutional
rights is disfavored. In fact, the Court itself emphasized that
it does not "‘lightly conclude that Congress intended to preclude
reliance on § 1983 as a remedy for the deprivation of a federally
secured right.'" Id. at 107 (quoting Wright v. Roanoke
Redevelopment & Hous. Auth., 479 U.S. 418, 423-24 (1987)). We
therefore decline to countenance the district court's decision to
dismiss Wintergreen's state and federal constitutional claims
under a preemption-based rationale.

16 Several other issues in dispute in this case, however,
were made moot because the district court dismissed Wintergreen's
state and federal inverse condemnation claims. For example, before the court dismissed Wintergreen's inverse condemnation
action, the court had before it Wintergreen's "Request for 4-Case
Consolidation or, in the Alternative, Request for 3-Case
Consolidation Plus Deeming 4th Case as Counterclaim." The
district court consolidated the three condemnation cases. This
ruling was not challenged, but the district court still must
decide whether Wintergreen's inverse condemnation action should
be treated as a counterclaim in the consolidated action or as an
independent action.

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