Opinion ID: 1813699
Heading Depth: 1
Heading Rank: 5

Heading: condemnation award

Text: In 1991, when this condemnation action was filed, and on July 23, 1991, when the NRD deposited $202,500 with the Douglas County Court, Neb.Rev.Stat. § 76-711 (Reissue 1990) provided that [i]f an appeal is taken from the award of the appraisers by the condemner, the condemnee shall be entitled to interest from the date of deposit at the rate provided in section 45-104.01, as such rate may from time to time be adjusted by the Legislature, compounded annually, on the amount finally allowed.... Neb.Rev.Stat. § 45-104.01 (Reissue 1988), referred to in the above statute as determining the rate of interest to be applied, provided for a 14-percent interest rate. On November 13, 1992, Neb.Rev.Stat. § 76-711 (Reissue 1996) was amended to provide that [i]f an appeal is taken from the award of the appraisers by the condemner, the condemnee shall be entitled to interest from the date of deposit at the rate provided in section 45-104.02, as such rate may from time to time be adjusted, compounded annually, on the amount finally allowed.... Neb.Rev.Stat. § 45-104.02 (Reissue 1993), referred to in the amended statute as determining the rate of interest to be applied, provides for a 14-percent interest rate through December 31, 1992. However, from January 1, 1993, and thereafter, § 45-104.02 further provides that the interest rate is to be redetermined every other year by the Tax Commissioner and shall be equal to the average short-term borrowing rate for the federal government during July of the previous year rounded to the nearest whole percentage point plus three percentage points. If the new rate does not increase or decrease the old rate by at least two percentage points, the old rate shall continue in effect. The NRD asserts that the appropriate rate of legal interest to be applied to the condemnation award is 14 percent until November 13, 1992. The NRD argues, however, that beginning November 13, 1992, the effective date of the amendment to § 76-711, interest should be assessed at a rate of 14 percent until December 31, 1992, and thereafter at a fluctuating rate to be determined by the Tax Commissioner. Conversely, Abboud contends that the proper rate of interest payable on the condemnation award for the entire period of the delinquency is 14 percent, since this was the interest rate in effect when the condemnation suit was filed and when the NRD deposited a sum of money with the county court. Thus, we must determine whether as of the effective date, the amendment to § 76-711 triggered a change in the statutory interest rate that is to be applied to the condemnation award. In essence, Abboud contends that the 14-percent interest rate became vested when the condemnation suit was filed and when the NRD deposited a sum of money with the county court. However, we agree with the NRD's assertion that the interest rate could not become vested because § 76-711, before amendment, explicitly provided that the [ interest ] rate may from time to time be adjusted by the Legislature.  If the Legislature intended the interest rate to become vested for the entire period that the payment of a condemnation award remains delinquent, this language would not have been included in the statute. See Coleman v. Chadron State College, 237 Neb. 491, 466 N.W.2d 526 (1991). The Legislature was neither silent nor ambiguous concerning the periodic interest rate adjustments on delinquent payments of condemnation awards. The only plausible reason for the above-italicized language is that the Legislature intended that interest on condemnation awards would be calculated at the different statutory interest rates provided for by the Legislature and that these different rates would be effective over the period that the payment of the condemnation award remains delinquent. Therefore, contrary to Abboud's contention, the 14-percent interest rate did not become vested; rather, only the right to the payment of interest on the condemnation award became vested. Furthermore, a legislative act operates only prospectively and not retrospectively, unless the legislative intent and purpose that it should operate retrospectively are clearly disclosed. Proctor v. Minnesota Mut. Fire & Cas., 248 Neb. 289, 534 N.W.2d 326 (1995); Vervaecke v. State, 247 Neb. 707, 529 N.W.2d 779 (1995). When the Legislature amended § 76-711 so that it referred to § 45-104.02 for the interest rate to be applied to a condemnation award, it explicitly provided for condemnation awards that were delinquent prior to the effective date of the amendment, such as in the instant case. Indeed, § 45-104.02(3)(c) mandates that [f]or any taxes or special assessments that were delinquent and unpaid on or before December 31, 1992, the interest rate shall be fourteen percent per annum through December 31, 1992. Thus, the inclusion of this language in the amended statute clearly evidences the Legislature's intent that the new statutory interest rate would apply retroactively to outstanding delinquencies, including delinquent condemnation awards. Abboud further observes that, under the amended version of § 76-711, the Tax Commissioner has the power to change the interest rate from time to time, whereas, before amendment, the Legislature had the power to change the interest rate from time to time. Thus, Abboud argues that because at the time of the award, the most recent change by the Legislature to the interest rate was to 14 percent, that is the rate that must apply to the condemnation award. We disagree. It is the Legislature that, in fact, amended § 76-711 to refer to § 45-104.02, which grants the Tax Commissioner the power to change the interest rate. Thus, in effect, it was the Legislature that changed the interest rate to a fluctuating one with such fluctuations to be determined by the Tax Commissioner. Accordingly, the new statutory interest rate must apply to the condemnation award from the effective date of the new rate. Moreover, we have previously held that a new statutory interest rate will apply to a condemnation award as of the effective date of the amendment implementing the new rate. In Iske v. Papio Nat. Resources Dist., 218 Neb. 39, 352 N.W.2d 172 (1984), the NRD had condemned a piece of land owned by Iske. On November 20, 1979, the NRD deposited a sum of money with the county court as compensation for the condemnation. In determining the amount of interest that was due to Iske on the condemnation award, we noted that before amendment, § 76-711 provided that the interest rate was 9 percent. However, in 1982, § 76-711 was amended to refer to § 45-104.01, which provided for a 14-percent interest rate. We concluded that the district court properly determined that the increased [14-percent] interest rate was to be applied [to the condemnation award] as of the effective date of the amendment. Iske v. Papio Nat. Resources Dist., 218 Neb. at 41, 352 N.W.2d at 174. See, also, Welch v. Welch, 246 Neb. 435, 519 N.W.2d 262 (1994) (holding that new fluctuating rate of interest will be applied to delinquent child support payments from effective date of new rate); Ferry v. Ferry, 201 Neb. 595, 602, 271 N.W.2d 450, 455 (1978) (holding that [w]hen the legal [interest] rate change[d], the new rate applie[d] to all delinquent [child support] installments from the effective date of the new rate); Colburn v. Ley, 191 Neb. 427, 215 N.W.2d 869 (1974) (holding that new interest rate will be applied to judgment as of effective date of new rate). Based on the foregoing reasons, we conclude that the district court erred in granting interest on the condemnation award at the rate of 14 percent for the entire period of the delinquency because the court failed to take into account an amendment effectuating a change in the interest rate to be applied. Therefore, we determine that the proper interest rate to be applied to the condemnation award is 14 percent until November 13, 1992. However, beginning November 13, 1992, the effective date of the amendment to § 76-711, interest should be assessed at a rate of 14 percent until December 31, 1992, and thereafter at a fluctuating rate to be determined by the Tax Commissioner. In accordance with the statute, the Tax Commissioner has determined that from January 1, 1993, through December 31, 1994, interest should be assessed at a rate of 7 percent and from January 1, 1995, through December 31, 1996, at a rate of 9 percent. Because the record does not contain evidence of the rate of interest to be applied to the delinquent portion of the condemnation award from January 1, 1997, to the present, it is necessary to remand the instant cause to the district court for a determination of the rate of interest from January 1, 1997, until the final date of payment of the award.