Court Opinion

ID: 2728249
Source: CourtListenerOpinion
Date Created: 2014-09-08 21:30:44.255799+00
Date Added: 2024-06-11T10:09:43.757770
License: Public Domain

NO. COA13-1010

                      NORTH CAROLINA COURT OF APPEALS

                             Filed: 17 June 2014

HIGH ROCK LAKE PARTNERS, LLC, a
North Carolina Limited Liability
Company, and JOHN DOLVEN,
     Petitioners-Appellants,

    v.                                      Mecklenburg County
                                            No. 07 CVS 18706
NORTH CAROLINA DEPARTMENT OF
TRANSPORTATION,
     Respondent-Appellee.

    Appeal by Petitioners from order entered 22 May 2013 by

Judge Richard D. Boner in Superior Court, Mecklenburg County.

Heard in the Court of Appeals 4 March 2014.

    Van Winkle, Buck, Wall, Starnes and David, P.A., by Craig
    D. Justus, for Petitioners-Appellants.

    Attorney General Roy Cooper, by Special Deputy Attorney
    General James M. Stanley, Jr., Assistant Attorney General
    Scott K. Beaver, and Assistant Attorney General Jennifer S.
    Watson, for Respondent-Appellee.

    McGEE, Judge.

    High     Rock     Lake   Partners,    LLC   (“High    Rock”)   purchased

approximately 190 acres in Davidson County (“the property”) in

August 2005.      High Rock intended to develop the property into a

sixty-lot   residential      subdivision.       High   Rock   purchased   the

property    for     $5,200,000.00.       John   Dolven,   M.D.     (“Dolven”)
                                             -2-
provided $3,600,000.00 of the purchase price through a secured

loan.    High Rock and Dolven are petitioners (“Petitioners”) in

this matter.         In December 2005, the Davidson County Board of

Commissioners        approved     the     preliminary          plat,   based        on    High

Rock’s   “meeting      all    the       County     requirements        for    subdivision

approval.”

     The only way to access the property was by way of State

Road 1135 (“SR 1135”), which was maintained by Respondent North

Carolina Department of Transportation (“DOT”), as part of the

State    Highway      System.           As     part      of    High    Rock’s        initial

development phase, it sought to extend SR 1135 ‒                             which dead-

ended    on    the    property      ‒     in     order    to    provide       a     driveway

connection into the planned subdivision.

     In October 2005, High Rock applied to DOT for a permit to

construct a driveway.             The proposed driveway connection point

was located on SR 1135, approximately one-quarter mile from a

railroad      crossing      (“the    railroad         crossing”).            Due    to     the

location of a railroad yard near the railroad crossing, idling

locomotives sometimes blocked the crossing.

     In a letter dated 12 December 2005, Chris Corriher, DOT

District      Engineer      for     Davidson       County,      denied       High        Rock’s

application.         High    Rock    timely        appealed     this    denial       to    DOT

Division Engineer, Pat Ivey (“Ivey”).                     Ivey granted High Rock’s
                                          -3-
permit application, with the conditions that High Rock widen the

railroad crossing and secure the necessary permissions from the

railroad     companies      to    do     so.      High     Rock   appealed     DOT’s

conditions to the DOT Driveway Permit Appeals Committee (“DOT

Appeals    Committee”).          The    DOT     Appeals    Committee     upheld    the

conditions set out by Ivey.                High Rock filed a Petition for

Judicial Review in Superior Court, Mecklenburg County, on 17

September 2007.

      Dolven    acquired         the     property     through      a     foreclosure

proceeding on 10 December 2007.                 High Rock assigned its rights

in   development     approvals,         including    the    driveway     permit,    to

Dolven.    High Rock sought to join Dolven as a party to the case

pending in Mecklenburg County Superior Court.                          On 26 August

2008, the trial court ruled, inter alia, that Dolven could not

be added as a party.              The trial court also ruled that DOT’s

actions    regarding        the        driveway     permit     were      statutorily

authorized     but   that    the       conditions    related      to    High   Rock’s

obtaining railroad consent were unconstitutional.

      Dolven appealed and, on 18 May 2010, this Court vacated the

trial court’s 26 August 2008 ruling and remanded the case for a

new hearing on the merits, with Dolven joined as a party.                         High

Rock Lake Partners, LLC v. N.C. Dep’t of Transp., 204 N.C. App.

55, 693 S.E.2d 361 (2010) (“High Rock I”).                   The trial court, as
                                           -4-
directed      by     this   Court,    joined      Dolven       by     order      entered    1

November 2010 and, in judgment entered 24 November 2010, ruled

that DOT had not acted (1) in excess of its statutory authority,

(2) arbitrarily and capriciously, or (3) in violation of either

the United States or North Carolina constitutions.                            Petitioners

appealed, and this           Court affirmed            the judgment of the trial

court.       High Rock Lake Partners, LLC v. North Carolina DOT, __

N.C. App. __ , 720 S.E.2d 706 (2011) (“High Rock II”).                                     Our

Supreme      Court    granted    discretionary          review      and    reversed     High

Rock II, determining that the conditions placed on the driveway

permit were not authorized under the plain language of N.C. Gen.

Stat.    §    136–18(29),       and   holding      that       DOT   had     exceeded       its

statutory authority by imposing those conditions.                                High Rock

Lake Partners, LLC v. N.C. Dep't of Transp., 366 N.C. 315, 323,

735 S.E.2d 300, 306 (2012) (“High Rock III”).                         A more extensive

factual      and   procedural     history        may    be    found    in     these    prior

opinions.

    Petitioners filed a motion for attorney’s fees pursuant to

N.C. Gen. Stat. § 6-19.1 on 14 January 2013.                           The trial court

heard    Petitioners’       motion    on   8     April       2013   and,    in    an   order

entered 22 May 2013, denied Petitioners’ motion.                              Petitioners

appeal.
                                       -5-
    Petitioners argue that the trial court erred in denying

their motion for attorney’s fees based upon the trial court’s

conclusion that “DOT’s positions in this case from the initial

denial of the driveway permit through to the Supreme Court’s

decision in High Rock [III] were substantially justified under

G.S. § 6-19.1.”        Petitioners further argue that, because of this

alleged error, this Court should instruct the trial court to

award Petitioners their attorney’s fees.            We disagree.

    N.C. Gen. Stat. § 6-19.1 states in relevant part:

           (a) In any civil action, . . . unless the
           prevailing party is the State, the court
           may, in its discretion, allow the prevailing
           party to recover reasonable attorney's fees,
           including attorney's fees applicable to the
           administrative review portion of the case,
           in contested cases arising under Article 3
           of Chapter 150B, to be taxed as court costs
           against the appropriate agency if:

                (1) The court finds that the agency
                acted without substantial justification
                in pressing its claim against the
           party;    and

                  (2) The court finds that there are no
                  special circumstances that would make
           the    award of attorney's fees unjust.

N.C. Gen. Stat. § 6-19.1 (2013) (emphasis added).                By the clear

language   of    the    statute,   once      the   trial   court    makes      the

appropriate     findings    required    in   subsections   (1)     and   (2)    of

N.C.G.S. § 6-19.1(a), its decision on whether or not to award

attorney’s fees is discretionary.
                                    -6-
             It is well settled that “[a]ppellate review
             of matters left to the discretion of the
             trial court is limited to a determination of
             whether   there   was    a   clear    abuse   of
             discretion.”   Furthermore, “[a] trial court
             may be reversed for abuse of discretion only
             upon   a  showing   that    its    actions   are
             manifestly unsupported by reason.”            “A
             ruling   committed    to   a    trial    court's
             discretion is to be accorded great deference
             and will be upset only upon a showing that
             it was so arbitrary that it could not have
             been the result of a reasoned decision.”

Smith v. Beaufort County Hosp. Ass'n., 141 N.C. App. 203, 210,

540 S.E.2d 775, 780 (2000)         (citations omitted).       In Crowell

Constructors, Inc. v. State ex rel. Cobey, our Supreme Court has

recognized the prerequisites required before a trial court can

exercise its discretion to award attorney’s fees pursuant to

N.C.G.S. § 6-19.1, as follows:

             Thus, in order for the trial court to
             exercise its discretion and award reasonable
             attorney's fees to a party contesting State
             action in one of the prescribed ways, the
             prevailing party must not be the State, the
             trial court must find the State agency acted
             “without   substantial    justification”  in
             pressing its claim and the trial court must
             find no special circumstances exist which
             make an award of attorney's fees unjust.

Crowell Constructors, Inc. v. State ex rel Cobey, 342 N.C. 838,

843,   467   S.E.2d   675,   678   (1996)   (emphasis   added).     Stated

another way, if the trial court determines that: (1) a State

agency   acted   “without    substantial    justification,”   and   (2)   no

special circumstances exist which make an award of attorney's
                                  -7-
fees unjust, then the trial court’s discretionary power to award

attorney’s fees manifests.       The trial court is not, however,

required to award attorney’s fees subsequent to making these

determinations, and its discretionary decision to award or not

to award attorney’s fees may only be overturned upon a showing

that   its   decision   constituted   an   abuse   of   its   discretion.

However, if the trial court determines that the State agency did

not    act   “without   substantial   justification,”    or   that   some

special circumstances do exist which make an award of attorney's

fees unjust, then the trial court lacks discretion, and cannot

award attorney’s fees.

       The trial court, in its 22 May 2013 order, acknowledged

that it only had discretion to award attorney’s fees pursuant to

N.C.G.S. § 6-19.1 if it found that DOT acted without substantial

justification and no special circumstances existed that made the

award of attorney’s fees unjust.        The trial court found as fact

that DOT did not argue the “special circumstances” prong of

N.C.G.S. § 6-19.1.      The trial court then concluded that DOT “was

justified [in its handling of this action] to a degree that

could satisfy a reasonable person[.]”       It further concluded, “in

its discretion, that attorney’s fees should not be awarded in

this matter.”

       In this instance, even assuming, arguendo, the trial court
                                                 -8-
erred     in      concluding              that        DOT     acted     with       substantial

justification,             the     trial       court        also   denied    the       award     of

attorney’s fees in its discretion.                            Because the discretion to

award attorney’s fees could only be present absent a conclusion

that DOT acted with substantial justification, the trial court’s

conclusion       that,           “in     its    discretion,         . . . attorney’s           fees

should     not        be     awarded       in    this        matter[,]”     constitutes         an

alternative basis for the denial of Petitioners’ motion.

      The standard of review for the trial court’s decision not

to award attorney’s fees on this basis is abuse of discretion,

and it is Petitioners’ duty to prove abuse of discretion in

order to prevail on appeal.                      Nationwide Mut. Fire Ins. Co. v.

Bourlon,    172        N.C.       App.    595,    610,       617   S.E.2d    40,       50    (2005)

(citations omitted) (“To show an abuse of discretion and reverse

the trial court's order . . . appellant[] has the burden to show

the     trial    court's           rulings       are    “‘manifestly        unsupported          by

reason,’”        or        “‘could       not     be    the     product      of     a    reasoned

decision[.]’”).              Petitioners         have       not    argued   that       the    trial

court abused its discretion by refusing to award them attorney’s

fees.

      It appears Petitioners believe that the trial court was

required to award them attorney’s fees                              if DOT acted            without

substantial justification in pressing its claim and no special
                                             -9-
circumstances existed which made an award of attorney's fees

unjust.          Petitioners      cite        Crowell        Constructors           for    the

proposition      that   DOT    had    to     prove      that   its       pursuit    of    this

action    was    substantially        justified;         otherwise,         according       to

Petitioners, the trial court was required to order DOT to pay

Petitioners’ attorney’s fees.                     In support of their argument,

Petitioners cite to a portion of Crowell Constructors in which

our   Supreme     Court    looked       to    similar      language        in   a    federal

statute to define the term “substantial justification.”                              Crowell

Constructors, 342 N.C. at 843-44, 467 S.E.2d at 679.                                However,

the federal statute differs from N.C.G.S. § 6-19.1 in a major

respect.    The federal statute states:

            “Except as otherwise specifically provided
            by statute, a court shall award to a
            prevailing party other than the United
            States     fees    and     other     expenses
            . . . incurred by that party in any civil
            action . . . brought by or against the
            United States . . . unless the court finds
            that the position of the United States was
            substantially justified or that special
            circumstances make an award unjust.”

Crowell    Constructors,        342     N.C.       at   843,       467    S.E.2d     at    679

(emphasis changed), (quoting 28 U.S.C. § 2412(d)(1)(A) (1994)).

The federal statute makes the award of attorney’s fees mandatory

absent     the    proper      showing        of    substantial       justification         or

special    circumstances,        whereas          N.C.G.S.     §    6-19.1      grants     the

trial court discretion in making an award of attorney’s fees.
                                             -10-
N.C.G.S. § 6-19.1(a) (“[T]he court may, in its discretion, allow

the prevailing party to recover reasonable attorney's fees[.]”).

      In Crowell Constructors, unlike in the present case, the

trial     court       had    already     ordered         the    State    agency    to    pay

attorney’s fees to the prevailing party.                         Crowell Constructors,

342 N.C. at 841, 467 S.E.2d at 678.                            Therefore, if the State

agency could show on appeal that it had acted with substantial

justification in pressing its claim, it would show that the

trial court had lacked the discretion to impose attorney’s fees

and had therefore erred.                Our Supreme Court held that it could

not     say        that    the   State       agency      was     “without     substantial

justification.”            Id. at   846, 467 S.E.2d at 681.               Therefore, the

award    of    attorney’s        fees    had      been    improper.         Id.     Another

opinion cited by Petitioners, Daily Express, Inc. v. Beatty, 202

N.C. App. 441, 688 S.E.2d 791 (2010), is similarly inapposite

because       it    also    dealt   with     an    appeal       where   the   trial     court

awarded attorney’s fees, not an appeal from the trial court’s

refusal to award attorney’s fees.                   Id. at 456, 688 S.E.2d at 802

(“[W]e conclude that [r]espondent's decision to proceed against

[p]etitioner was ‘substantially justified’ and that the trial

court    erred        by    reaching     a    contrary         conclusion     in   awarding

attorney's fees to [p]etitioner pursuant to N.C. Gen. Stat. § 6–

19.1”[.]).
                                 -11-
    In the present matter, even assuming arguendo DOT lacked

substantial justification in pressing its claims, Petitioners

would have had to argue on appeal and show that the trial court

abused   its   discretion   in   denying   Petitioners’   motion   for

attorney’s fees.    Bourlon, 172 N.C. App. at 610, 617 S.E.2d at

50; see also Willen v. Hewson, 174 N.C. App. 714, 722, 622

S.E.2d 187, 193 (2005).     Because Petitioners have not argued on

appeal that the trial court abused its discretion in failing to

award them attorney’s fees pursuant to N.C.G.S. § 6–19.1, any

such argument is abandoned.       N.C.R. App. P. 28(b)(6) (“Issues

not presented in a party's brief, or in support of which no

reason or argument is stated, will be taken as abandoned.”).

Petitioners’ argument is dismissed.

    Because Petitioners’ second and third arguments rely upon

the success of their first, those arguments also fail.         The 22

May 2013 order denying attorney’s fees is affirmed.

    Affirmed.

    Judges STEELMAN and ERVIN concur.