Court Opinion

ID: 9564339
Source: CourtListenerOpinion
Date Created: 2023-08-21 18:58:18.973346+00
Date Added: 2024-06-11T09:18:21.604893
License: Public Domain

Littlejohn, Justice:
The plaintiff, Creative Displays, Inc., seeks compensation for an outdoor advertising sign which was located on real property over which the defendant, South Carolina Highway Department, acquired a right-of-way easement. The case was tried without a jury by agreement; most of the facts were stipulated. It was agreed that the amount of damages, if any, which plaintiff was entitled to recover would be $20,-000.
Plaintiff bases its claim to compensation for its sign on the Federal Relocation Assistance and Real Property Acquisition Act, Public Law 91-646 (January 1971), 42 U. S. C. A. § 4601, et seq., and upon agreements and representations between the Department and the Federal Highway Administration. The Department contends that the sign was personal property, was not a fixture, was not acquired and that no compensation is due.
The trial judge entered an order in favor of the plaintiff, awarding $20,000.00 compensation. The Department has appealed. We find that the Federal Act is of no comfort to the plaintiff and that the sign is personal property under South Carolina law. We reverse.
On August 14, 1969, Mrs. J. M. Conway, Jr., landowner, leased certain premises along route 291 in Greenville County to Miller Outdoor Advertising, Inc., for the erection of an outdoor advertising double sign. In the summer of 1974, she sold the realty to C. F. Upchurch, et al., and Upchurch succeeded to her interest. The plaintiff, Creative Displays, Inc., has succeeded to the interest of Miller Outdoor Advertising, Inc.
The lease provided for numerous events, the occurrence of any one of which would offer the plaintiff the right to terminate the lease1 and remove the sign. These events included *71destruction, or entire or partial obscurity of the sign, diminution in value of the site as a sign location, temporary or permanent diversion of traffic, and prohibition by law or ordinance of construction or maintenance of the sign. In addition, the lease contained the following language:
“All structures, equipment and materials placed upon the said premises by the Lessee [plaintiff] shall always remain the personal property of, and may be removed by the Lessee at any time prior to or within a reasonable time after the expiration of the term thereof or any extension thereof.
If property is sold or developed, advertising structures will be removed within thirty (30) days from written notice.” (Emphasis added.)
No new written lease for any of the five one-year extensions has been executed. The plaintiff continued to pay rentals to Upchurch. Within the original five-year lease period, on July 29, 1974, the landowners conveyed by way of right of-way easement deed, an easement to the defendant Highway Department. On July 12, 1974 (before the easement was signed and before the expiration of the five-year period), the Highway Department notified the plaintiff that it would be necessary to remove the sign. Three days later, on July IS, 1974, the plaintiff wrote to the Department:
“[W]e do not have a location suitable to move the structure that is located on 291. We would be happy to consider any location that you may have in mind (sic). “We would prefer to perfom any work involved in moving this unit, so we will know that it will be done properly.”
On July 30, 1974, after the Department had acquired the easement, it wrote the plaintiff, advising that the sign could not hold up the construction project and advising that the sign would be removed and stored for the use of the plaintiff. On August 14, 1974, still within the five-year lease period, the Department wrote to the plaintiff:
*72“[P] lease accept this letter as official notice to remove the sign from the right of way within 30 days after receipt thereof.”
The plaintiff refused to remove the sign and, on September 17, 1974, the Department stored it and continues to hold the same for the plaintiff.
The Department did not acquire the sign in connection with its construction project. The sign is personal property, both by stipulation of the parties to1 the lease and as a matter of law. A fixture is generally defined as “an article which was a chattel, but by being physically annexed to the realty by one having an interest in the soil becomes a part and parcel of it.” By mere affixation the chattel does not become a fixture. The test for determining whether an item remains personalty or becomes a fixture was described in Caroll v. Britt, 227 S. C. 9, 86 S. E. (2d) 612 (1955). The criteria for this determination included: (1) mode of attachment, (2) character of the structure or article, (3) the intent of the parties making the annexation, and (4) the relationship of the parties. The nature and content of the lease require a determination that -the sign remained personalty.
In South Carolina State Highway Dept. v. Smith, 253 S. C. 639, 172 S. E. (2d) 827 (1970), this court had before it the question of whether pesonal property located on realty condemned for a public purpose was compensable. We said:
“When land is taken under the power of eminent domain, the ownership of personalty kept on the premises taken, but not permanently affixed thereto, is not affected; and the owner is entitled to remove same as was done here. Actually, here the removal of the personal property was done by the landowner before the taking of the land and buildings thereon.
“ ‘A majority of the State Courts hold that, in the absence of a statute or agreement to the contrary, the removal costs of a stock of merchandise, or other personal property, *73and the breakages or other injury to such property caused by such removal, from a leasehold or fee in land, where there is an entire taking of the whole of the condemnee’s estate under the sovereign power of eminent domain, cannot be considered as an element of damage, since such loss is not a taking of property.’ (Citations omitted) Williams v. State Highway Commission, 252 N. C. 141, 113 S. E. (2d) 263, 266.
“This is simply because personal property, unlike fixtures, can be removed from the condemned premises. See 4 Nichols on Eminent Domain, Sec. 13.13 (3rd ed. rev. 1962) (1969 Supp.); 27 Am. Jur. (2d) Eminent Domain Sec. 293 (1966).
“ Tt is generally held that damages in condemnation proceedings should be allowed in respect of fixtures which have become a part of the reality.
“ * * (but) compensation cannot be recovered in such a proceeding for damages resulting to personal property not annexed (at least constructively) to the freehold.’ Annot. 90 A.L.R. 159-160 (1934).”
In making his determination the trial judge gave significance to § 302(la) of the Act, which reads as follows:'
Notwithstanding any other provision of law, if the head of a Federal agency acquires any interest in real property in any State, he shall acquire at least an equal interest in all buildings, structures, or other improvements located upon the real property so acquired and which he requires to be removed from such real property or which he determines will be adversely affected by the use to which such real property will be put.
The judge found “. . . that the sign or billboard in question is the type ‘structure’ or ‘improvement’ refered to in the Act.” Therein we think he erred. One of the purposes of the Federal Act is to provide a uniform policy of real property acquisition practices in all cases in*74volving the use of federal funds. But the Act cannot and does not change the South Carolina Constitution and statutory law. The “. . . buildings, structures, or other improvements located upon the real property so acquired . . .” refers to buildings, structures and other improvements which have become a part of the realty, and does not refer to personal property located thereon. “Fair market value” referred to in§ (b)(1), is not affected by personal property which may be removed.
In order to participate in federal funds, the Highway Department gave assurance to the federal agency as follows: “[I]n acquiring real property, it will be guided, to the greatest extent practicable under State law, by the provisions of 42 U.S.C.A. § 4652.”
The obvious purpose of this agreement on the part of the Department is to assure the federal agency that its funds will not be spent under a more liberal policy than the state uses in acquiring other easements. The agreement was never intended to require the state to acquire property which it would not normally acquire if it were financing the entire project itself.
Section 460 2(b) of 42 U. S. C. A. is significant. It provides :
“Nothing in this chapter shall be construed as creating in any condemnation proceeding brought under the power of eminent domain, any element of value or of damage not in existence immediately prior to [the effective date of the act].”
The plain meaning of this provision is that the act neither adds to nor takes from elements of value or damage in the law of eminent domain as developed through the years by the General Assemblies and by the courts of the respective states.
Plaintiff’s general manager testified that it was standard in the signboard trade that one had to anticipate that from time to time signs would have to be moved. *75Obviously, a landowner cannot tie up valuable real estate for the meager rental received for permitting signs to be erected. This is evident from the lease here involved. The state is required to provide just compensation to a property owner deprived of property committed to a public use. Here the state has not acquired the sign; it has not deprived the plaintiff of property for which just compensation should be paid. The sign is today owned by the plaintiff, which is at liberty to procure it from the Highway Department warehouse.
The lower court erred, and its order is reversed.
Ness, Rhodes and Gregory, JJ., concur.
Lewis, C. J., dissents.

 It was a five-year lease with option to renew for five additional one-year periods.