Title: City of Laurel v. Powers

State: mississippi

Issuer: Mississippi Supreme Court

Document:

366 So. 2d 1079 (1979) The CITY OF LAUREL, a Municipal Corporation, the Laurel Urban Renewal Agency, a Body Corporate and Politic, v. Viola D. POWERS and Curtis N. Jones. No. 50659. Supreme Court of Mississippi. January 10, 1979. *1080 Pickering & McKenzie, Franklin C. McKenzie, Jr., Gibbes, Graves, Mullins, Bullock & Ferris, Ernest W. Graves, Laurel, for appellant. Lunsford Casey, Thomas Gene Clark, Laurel, for appellee. Before PATTERSON, SUGG and BOWLING, JJ. SUGG, Justice, for the Court: This is an appeal from a final decree of the Chancery Court of Jones County, awarding damages to complainants, Curtis N. Jones and Viola D. Powers, for taking private property by the City of Laurel by inverse condemnation. The complainants owned Lot 7 of the Commercial Block Addition to the City of Laurel, and on September 18, 1959, Jones executed a deed which conveyed his one-half interest in Lot 7 to the city. His deed provided for a reverter in the following language: On September 1, 1959, Viola D. Powers, executed a lease contract with the city leasing her one-half interest in Lot 7 to it. The lease contained a provision giving the city an option to purchase her interest which was exercised by the city on September 20, 1973. Her deed contained the same provision for reverter as the Jones deed. Complainants alleged in their bill of complaint that title to a part of Lot 7 reverted to them when the city conveyed part of Lot 7 to the Laurel Urban Renewal Agency (hereinafter LURA) for the purpose of using that part of the lot for a street rather than for parking; that acquisition of the property by LURA was made with federal or federal aid funds; that the ultimate result will be that LURA will return the property to the city, thus enabling the city to accomplish indirectly what it could not do directly because of the reverter provisions in the deeds from complainants; that the action of the city amounts to inverse condemnation; that complainants are entitled to compensation for the property taken with damages to the remainder, and are also entitled to reasonable expenses, including reasonable attorneys' fees, appraisal and engineering fees. Complainants prayed for a decree adjudging them to be the true owners of Lot 7, for cancellation of the deed from the city to LURA. In the alternative, they prayed for a decree for the fair market value of the property, including damages to the remainder with interest together with costs, reasonable attorneys' fees and appraisal and engineering fees. At the trial the parties stipulated the following: 1. That Lot 7 contained 7500 square feet. *1081 2. That the city conveyed to LURA 3,264.39 square feet of Lot 7 on December 11, 1973. 3. That LURA used the portion of Lot 7 deeded to it by the city for widening Fifth Street and Auburn Avenue, as a part of the "Laurel Central Business District Urban Renewal Area Project R-27." 4. That federal funds were used in Project R-27. That in consideration of the conveyance by the city to LURA of a part of Lot 7, the city received as credit toward payment of its part of the cost of Project R-27 the amount of $23,831.00 which amount was arrived at as follows: From the exhibits attached to the stipulation it was established that the number of parking spaces on Lot 7 was reduced from twenty-four to six after widening Fifth Street and Auburn Avenue. The final decree adjudged that the complainants were entitled to recover compensation damages in the amount of $23,831.00 for the inverse condemnation with interest from December 11, 1973 at the rate of 6 percent per annum until July 1, 1977 in the amount of $5,004.51. The decree further provided that the interest should be added to the damages making a total of $28,835.51, plus $3,000.00 attorneys' fees which was allowed for a total judgment of $31,835.57. The decree also provided that the judgment should bear interest at the rate of 8 percent per annum from the date of the decree, July 1, 1977, until paid. The city appealed and assigns the following as error: Before treating the assignments of error, the respective interests of the complainants and the city under the deeds should be noted. Complainants conveyed to the city Lot 7, These deeds created a determinable fee estate[1] in the city, with a possibility of reverter, in fee simple absolute, remaining vested in the complainants. Jones v. Burns, 221 Miss. 833, 74 So. 2d 866 (1954). When complainants conveyed Lot 7 to the city "so long as" it might be used for public parking, it was not a conveyance of a fee simple title cut down by a later limitation. The only title the city ever had was during the time the property should be used for public parking. The title ceased when the public parking use ended. The cessation of the *1082 use of the property for public parking was a condition subsequent and not a covenant. We have also held that a reservation to the grantor or his heirs is a vested interest and is not within the rule against perpetuities. St. Regis Pulp & Paper Corp. v. Floyd, 238 So. 2d 740 (Miss. 1970); Jones v. Burns, supra. The protected status granted a possibility of reverter from the rule against perpetuities has been the subject of much criticism. In the City of Klamath Falls v. Bell, 7 Or. App. 330, 490 P.2d 515 (1971), the Court stated in footnote 3 the following: Many legal text writers agree that where the rule against perpetuities has been applied to possibilities of reverter it has always been done by legislative action. It appears illogical to grant this protective status to a possibility of reverter and subject property to a special limitation by some ancient document; however, this is a legislative question. We do not treat this question further because it is not necessary for a decision of this case, but take this method of calling the legislature's attention to this question for possible action by it to subject possibilities of reverter to the rule against perpetuities. The first two assignments of error will be treated together and may be summarized as follows: did the use of a part of Lot 7 for street widening purposes violate the reverter provision? The city argues that the street widening improvements were not contrary to or violative of the reverter provisions in the deeds, but to the contrary, are complementary to and auxiliary to the use of the property for public parking purposes. The city relies heavily on Patrick v. Miss. State Highway Commission, 184 So. 2d 850 (Miss. 1966) as authority for its position. In 1903 the Antioch Baptist Church received a deed to a parcel of land. The deed contained a provision that if the land ceased to be used for church and graveyard purposes, title would revert to the grantor, his heirs and assigns. In 1961 the church deeded .93 acres of the land to the Highway Commission in order to widen a public highway. In his opinion, the chancellor distinguished the Patrick case and this case as follows: We hold this assignment of error is not well taken for the reasons stated by the chancellor in his opinion. The portion of Lot 7 conveyed by the city to LURA reverted to the complainants and they are entitled to damages for the inverse condemnation. In the third assignment of error the city argues that the chancellor erred in awarding judgment to complainants for damages to the remainder of Lot 7 which was not used for street widening purposes and in awarding damages for improvements on the property used for street widening purposes. The city conveyed LURA approximately one-half of Lot 7 which was converted from a parking lot to a street with the remaining part of Lot 7 continuing to be used for a parking lot. The chancellor did not include any damages for the value of the fee for the portion of Lot 7 which is presently used as a parking lot. The chancellor held that the execution of the deed by the city to LURA on December 11, 1973 was a violation of the condition subsequent in each of complainants deeds and caused "the property" to revert to the original owners. The opinion does not specify what property was included in the term "the property." In our opinion the term "the property," as used in the opinion, means only the property included *1084 in the deed from the city to LURA. This is consistent with the fact that the chancellor awarded severance damages to the part of Lot 7 retained by the city, which it continued to use for public parking, but did not award any damages for the value of the fee to the part of Lot 7 which was retained by the city. Complainants did not file a cross appeal so the question of whether Lot 7 in its entirety reverted to them is not before us. The city owns that portion of Lot 7 not included in the deed to LURA subject to the possibility of a reverter to the complainants. Are complainants entitled to compensation for severance damages to the remainder of Lot 7 now being used by the city for public parking? In Hemphill v. Miss. State Highway Commission, 245 Miss. 33, 145 So. 2d 455 (1962) we stated: In our case part of Lot 7 is being used by the city for public parking, and there is no showing that the city will cease using it for public parking within the foreseeable future. We conclude that the possibility of reverter vested in the complainants to the balance of Lot 7 is not of a sufficiently substantial character to warrant protection. Therefore, complainants are not entitled to recover severance damages to the remainder of Lot 7; neither are they entitled to recover the value of the fee for the remainder of Lot 7. We therefore reverse the holding of the chancellor that complainants were entitled to severance damages to the remainder of Lot 7. We affirm the allowance of damages as follows: Interest on $15,995 will be allowed from December 11, 1973 until July 1, 1975 at the rate of 6% per annum and at the rate of 8% per annum from July 1, 1975 until paid. We also affirm the allowance of $3,000 attorneys' fees as authorized by section 43-37-9 Mississippi Code Annotated (Supp. 1976) together with interest on $3,000 from the date of the decree, July 1, 1977, until paid. AFFIRMED IN PART, REVERSED IN PART AND RENDERED. *1085 PATTERSON, C.J., SMITH and ROBERTSON, P. JJ., and WALKER, BROOM, LEE, BOWLING and COFER, JJ., concur. [1] The term determinable fee is sometimes called a base or qualified fee, or a fee simple defeasible. In Bradford v. Federal Land Bank of New Orleans, 338 So. 2d 388 (Miss. 1976) we held that where an estate is determined by an event not certain to occur, it is a fee simple defeasible.