Court Opinion

ID: 1057719
Source: CourtListenerOpinion
Date Created: 2013-10-09 18:26:34.212903+00
Date Added: 2024-06-11T12:05:55.462886
License: Public Domain

Present: Kinser, C.J., Lemons, Millette, Mims, McClanahan,
Powell, JJ. and Lacy, S.J.

PKO VENTURES, LLC
                                          OPINION BY
v. Record No. 121534              JUSTICE LEROY F. MILLETTE, JR.
                                         September 12, 2013
NORFOLK REDEVELOPMENT AND HOUSING AUTHORITY

             FROM THE CIRCUIT COURT OF THE CITY OF NORFOLK
                        Louis A. Sherman, Judge

     In this appeal we consider whether a redevelopment and

housing authority may acquire by process of eminent domain

unblighted private property located within a blighted area

designated for redevelopment subsequent to a statutorily imposed

limitation on acquisition by condemnation to only those

properties that are themselves blighted.

                        I. Facts and Proceedings

A.   Creation of the Redevelopment Project and Earlier
     Acquisitions

     In January 1998, the Council of the City of Norfolk

approved the Hampton Boulevard Redevelopment Project ("the

Redevelopment Project") created by the Norfolk Redevelopment and

Housing Authority ("NRHA") under the authority of Code §§ 36-49

and 36-51.    Code § 36-49 authorizes a redevelopment and housing

authority to "adopt a redevelopment plan for a designated

redevelopment area to address blighted areas."     A redevelopment

and housing authority is "specifically empowered to carry out
any work or undertaking in the redevelopment area[,]" including

"[a]cquir[ing] blighted areas."   Code § 36-49(A)(1).

     Code § 36-51(A) authorizes localities to "approve

redevelopment plans through their governing body or agency

designated for that purpose."   The properties affected by the

Redevelopment Project included a nine and one-half block area

bounded by Hampton Boulevard on the west, 48th Street on the

north, Killam Avenue on the east, and 38th Street on the south,

all within the City of Norfolk.

     The NRHA's approval of the Redevelopment Project was based

upon a redevelopment study which determined that the

Redevelopment Project area was blighted due to incompatible land

uses, disrepair, environmental risks, demographic changes, and

high crime rates.   Based upon the study, the NRHA concluded

that, without eliminating these factors, the adverse impact on

the general welfare would increase.   The proposed Redevelopment

Project's properties were classified as good, fair, or poor.

The latter classification indicated a structure with extensive

exterior deterioration and an unlikely economic feasibility of

rehabilitation.   Of all the properties, twenty percent were

classified as poor.   The Redevelopment Project area was selected

to assist in the orderly expansion of Old Dominion University

("ODU"), a public university located immediately adjacent to the

Redevelopment Project.

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     Following approval of the Redevelopment Project, two

decisions of the Circuit Court of the City of Norfolk, in 1999

and 2009, rejected challenges to the NRHA's condemnation of

several of the individual properties within the Redevelopment

Project.   In 1999, the circuit court held that the area

designated for the Redevelopment Project was blighted under Code

§ 36-49.   Norfolk Redevelopment & Hous. Auth. v. J.A.G. Assocs.,

No. CL99-1100 (Norfolk Cir. Ct. Nov. 16, 1999) (order overruling

jurisdictional defenses).   In 2009, in rejecting a challenge to

a subsequent petition to condemn other individual properties

within the Redevelopment Project, the circuit court held that

the doctrine of stare decisis prevented these landowners from

relitigating the 1999 determination that the Redevelopment

Project was blighted and that the NRHA did not act in an

arbitrary or unreasonable manner.    The circuit court, in the

alternative, confirmed that the area was blighted.    Norfolk

Redevelopment & Hous. Auth. v. Arney, No. CL08-1918 (Norfolk

Cir. Ct. July 23, 2009)(letter opinion).

     In its 2009 order, the circuit court also addressed a claim

contesting the propriety of ODU's agreement with the NRHA in

which ODU agreed to pay the NRHA a commission of four percent of

the total land assembly costs incurred for the acquisition of

property within the Redevelopment Project area.   According to

the Cooperation Agreement between the NRHA and ODU, land

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assembly costs included appraisals, the title search,

environmental studies, title insurance, surveys of individual

parcels, and the purchase price for properties acquired by deed

or condemnation.   The circuit court held that the NRHA's

acceptance of a commission of four percent of the total land

assembly costs from ODU did not create an improper agency

relationship between the NRHA and ODU.

B.   Acquisition of the Subject Property

     On April 21, 2010, the NRHA, after making an unsuccessful

offer to purchase, filed a petition to condemn the subject

property ("the Property") under the authority of Code § 36-49.

The Property is a parcel of land comprised of approximately

10,000 square feet located at 1069 West 41st Street in the City

of Norfolk and improved by a ten-unit residential apartment

building, then owned by PKO Ventures, LLC ("PKO").   According to

a stipulation between the parties, the Property was not blighted

at the time that the NRHA filed its petition.   The petition

indicated that the Redevelopment Project had been approved and

that the Property was included within the designated

Redevelopment Project area.   The petition requested that the

circuit court condemn the Property and pass title to the

Property in fee simple to the NRHA.   PKO filed an answer and

grounds of defense to the NRHA's petition for condemnation.

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     The NRHA filed a motion to strike PKO's objections and

affirmative defenses.   It argued that the doctrine of stare

decisis precluded PKO from challenging the NRHA's acquisition of

its Property by eminent domain because the court had twice

upheld challenges to the Redevelopment Project in 1999 and 2009.

PKO filed a response to the NRHA's motion to strike.

     In response to the NRHA's motion to strike, PKO argued that

(1) Code § 1-219.1 precluded the NRHA from acquiring PKO's

unblighted Property after July 1, 2010, (2) stare decisis does

not apply because the particular objections and defenses raised

by PKO were not raised in 1999 or 2009, and in part could not

have been raised because the law then in effect was different,

and (3) the NRHA violated due process requirements because it

had a pecuniary interest in the outcome which biased its

decision to condemn properties constituting the Redevelopment

Project.

     The Circuit Court of the City of Norfolk, after a hearing

on the matter, denied PKO's objections and defenses to the

acquisition of the Property, granted the NRHA's motion to strike

in part, and authorized the NRHA to acquire PKO's Property by

eminent domain.   In its letter opinion, the circuit court

reasoned that the law that was in effect on the day the petition

was filed controlled, and that, otherwise, the retroactive

application of Code § 1-219.1 to discontinue the case would be

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in violation of Code §§ 1-9 and 1-239.      The circuit court also

held that the Redevelopment Plan was lawful, applying the

results of the 1999 and 2009 cases to the present case by virtue

of the doctrine of stare decisis.       At the conclusion of the

subsequent July 2012 jury trial to determine just compensation

for the Property, the NRHA acquired the Property for $550,000.

PKO filed a timely appeal, and we granted review on all

assignments of error.

                             II.   Discussion

A.   Whether the Circuit Court Erred by Permitting the NRHA to
     Acquire the Property at Issue After July 1, 2010

           1.   Legislative History of Code § 1-219.1

     The Virginia General Assembly in 2007 enacted Chapters 882,

901 and 926, all of which are substantively identical

(collectively "Chapter 882").      Paragraph 1 of Chapter 882 added

the current § 1-219.1 to the Code of Virginia.      As relevant

here, the legislation provided that property taken for

condemnation must itself be blighted at the time the petition

for condemnation is filed:

            A. The right to private property being a
          fundamental right, the General Assembly
          shall not pass any law whereby private
          property shall be taken or damaged for
          public uses without just compensation. The
          term "public uses" mentioned in Article I,
          Section 11 of the Constitution of Virginia
          is hereby defined as to embrace only the
          acquisition of property where: . . . (v)
          the property is taken for the elimination of

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          blight provided that the property itself is
          a blighted property.

                                . . . .

            B. For purposes of this section: "Blighted
          property" means any property that endangers
          the public health or safety in its condition
          at the time of the filing of the petition
          for condemnation and is (i) a public
          nuisance or (ii) an individual commercial,
          industrial, or residential structure or
          improvement that is beyond repair or unfit
          for human occupancy or use.

Code § 1-219.1(A), (B) (emphasis added).

     Paragraph 3 of Chapter 882 provides:

          until July 1, 2010, the provisions of this
          act shall not affect the ability of a
          redevelopment and housing authority
          organized pursuant to Title 36 of the Code
          of Virginia to acquire property pursuant to
          any redevelopment or conservation plan
          adopted prior to January 1, 2007. However,
          the provisions of this act shall be
          applicable to all redevelopment and
          conservation plans adopted after January 1,
          2007.

(Emphasis added.)   Paragraph 4 of Chapter 882, as amended by

Acts 2010, ch. 203, provides:

          [n]othing contained in this act shall
          prohibit the Norfolk Redevelopment and
          Housing Authority or the City of Norfolk to
          acquire property located at . . . , both
          located in the City of Norfolk, through the
          use of eminent domain for the location of a
          recreational facility open to the public to
          be owned or operated by a not-for-profit
          entity, provided such acquisitions are
          instituted prior to January 1, 2011.

                                   7
(Emphasis added).

2.   Statutory Interpretation of Code § 1-219.1 and Paragraphs 3
                      and 4 of Chapter 882

     PKO, in its first assignment of error, contends that the

circuit court erred in allowing the NRHA to acquire the Property

after July 1, 2010 by a condemnation action that the NRHA filed

before July 1, 2010.    PKO argues that the circuit court erred

because: (1) the Property was not blighted at the time the

petition was filed, as required by Code § 1-219.1, and (2) the

acquisition of unblighted property was prohibited beginning on

July 1, 2010, as indicated in Paragraph 3 of Chapter 882.

     PKO's assignment of error presents an issue of statutory

interpretation of both Code § 1-219.1 and Paragraphs 3 and 4 of

Chapter 882.   This presents a pure question of law which we will

review de novo.    Laws v. McIlroy, 283 Va. 594, 598, 724 S.E.2d
699, 702 (2012).    When evaluating statutory language, the Court

applies "the plain language of a statute unless the terms are

ambiguous."    Boynton v. Kilgore, 271 Va. 220, 227, 623 S.E.2d
922, 926 (2006).    "When an enactment is clear and unequivocal,

general rules for construction of statutes of doubtful meaning

do not apply."     Brown v. Lukhard, 229 Va. 316, 321, 330 S.E.2d
84, 87 (1985).

     We have held that "in the construction of statutes

conferring the power of eminent domain, every reasonable doubt

                                   8
is to be [resolved] adversely to th[at] right."    School Board v.

Alexander, 126 Va. 407, 413, 101 S.E. 349, 351 (1919).

"[U]nless both the spirit and letter of the statute clearly

confer the power, it cannot be exercised."   Id.   Statutes

authorizing the power of eminent domain must, therefore, "be

strictly construed, and a locality must comply fully with the

statutory requirements when attempting to exercise this right."

3232 Page Ave. Condo. Unit Owners Ass'n v. City of Va. Beach,

284 Va. 639, 645, 735 S.E.2d 672, 675 (2012).

     The plain meaning of Code § 1-219.1 makes it clear that

redevelopment and housing authorities no longer have the

authority to condemn individual properties within a

redevelopment area determined to be a blighted area when the

properties are not themselves blighted.   The central issue in

this appeal, however, is whether the NRHA, in its acquisition of

the Property, is bound by the enactment of Code § 1-219.1.

              3.   Effective Date of Code § 1-219.1

     Code § 1-219.1 became effective on July 1, 2007.    It

applied to all governmental entities, including the NRHA.     The

"ability. . . to acquire" property as specified in Paragraph 3

refers to the completion of an effective taking, and does not

permit a redevelopment and housing authority acting pursuant to

a valid redevelopment plan to acquire properties that are not

                                9
themselves blighted after July 1, 2010 merely by filing a

petition for condemnation.

     We have held that "we have a duty, whenever possible, to

interpret the several parts of a statute as a consistent and

harmonious whole so as to effectuate the legislative goal.

Generally, the Court will look to the whole body of [a statute]

to determine the true intention of each part."     Ford Motor Co.

v. Gordon, 281 Va. 543, 549, 708 S.E.2d 846, 850 (2011) (quoting

Oraee v. Breeding, 270 Va. 488, 498, 621 S.E.2d 48, 52-53

(2005)).   This includes "the entirety of a single legislative

enactment as it appears in the Acts of Assembly as a whole."

Eberhardt v. Fairfax Cnty. Employees’ Ret. Sys., 283 Va. 190,

194, 721 S.E.2d 524, 536 (2012).     Accordingly, we must read the

text of Chapter 882 as a whole to determine the intended meaning

of the words "ability . . . to acquire" as used in Paragraph 3.

     We also assume "[w]hen interpreting and applying a statute,

. . . that the General Assembly chose, with care, the words it

used in enacting the statute, and we are bound by those words."

Kiser v. A.W. Chesterton Co., 285 Va. 12, 19 n.2, 736 S.E.2d
910, 915 n.2 (2013) (internal quotation marks omitted).    Because

we assume that the General Assembly chose the statutory language

with care, "when the General Assembly has used specific language

in one instance, but omits that language or uses different

language when addressing a similar subject elsewhere in the

                                10
Code, we must presume that the difference in the choice of

language was intentional."   Newberry Station Homeowners Ass'n v.

Board of Supervisors, 285 Va. 604, 616, 740 S.E.2d 548, 554

(2013) (internal quotation marks omitted).

     We presume that the General Assembly's use of specific

language in Paragraph 4 of Chapter 882 was intentional and

consequential.   Paragraph 4 establishes an exception to the

application of the provisions of Code § 1-219.1 specifically for

the NRHA for one specific recreational project, which is not the

project at issue here, so long as the petition for acquisition

by eminent domain was "instituted prior to January 1, 2011."

Thus, Paragraph 4 clearly sets a deadline for the filing of the

petition for condemnation and demonstrates that when the General

Assembly wanted to make an exception to the application of Code

§ 1-219.1 based on the date a petition for condemnation was

filed, it did so with clear and unambiguous language.

     In contrast, Paragraph 3 applies to all redevelopment and

housing authorities operating pursuant to redevelopment plans

adopted prior to January 1, 2007.    It does not refer to either

the filing of a petition for condemnation or the institution of

the acquisition of property, but instead places a limitation on

the "ability of a redevelopment and housing authority . . . to

acquire property."   This language is not comparable to the

language contained in Paragraph 4 of Chapter 882 and cannot be

                                11
construed to provide an exception to the application of Code

§ 1-219.1 based on the date the petition for condemnation was

filed.

      Accordingly, we hold that the circuit court erred when it

allowed the NRHA to acquire the Property subsequent to the

statutory deadline.    The parties stipulated that the Property

was not blighted.    Further, the NRHA did not acquire the

Property by obtaining title by certificate of take or

certificate of deposit, or an award pursuant to a petition for

condemnation prior to the July 1, 2010 deadline established by

Paragraph 3.    The NRHA therefore retained its ability to acquire

the unblighted property only until July 1, 2010 when the

limitations of Code § 1-219.1 became applicable.    On July 1,

2010, the terms of Code § 1-219.1 governed the NRHA's attempted

acquisition and barred its authority to condemn PKO's unblighted

Property.

 4.      Whether the NRHA Had a Substantive Right to Acquire PKO's
                  Property under Title 36 of the Code

      The NRHA contends that even if the Court determines that

Paragraph 3 of Chapter 882 does require it to have completed

litigation prior to the July 1, 2010 deadline, the circuit court

did not err.    The NRHA argues that Title 36 of the Code

conferred the NRHA with a substantive right to acquire PKO's

Property that cannot be impaired by the enactment of a later

                                  12
statute.    According to the NRHA, the law in effect when its

right to acquire the Property accrued governs the proceeding. *

The NRHA contends that its right to obtain PKO's Property arose

in 1998 with the adoption of the Redevelopment Project, and that

the language of Code § 1-219.1 cannot limit that right.    We

disagree.

     We have previously held that "there are no vested rights in

a potential result in pending litigation."    Marriott v. Harris,

235 Va. 199, 212, 368 S.E.2d 225, 231 (1988) (internal quotation

marks omitted).    The NRHA filed a petition for condemnation in

April 2010 but did not acquire title to the Property until after

     *
         In making this argument, the NRHA relies, in part, on Code
§ 1-9.    Code § 1-9 states, in relevant part:

              Nothing in this Code shall operate to
            discontinue any cause or matter, civil or
            criminal, which shall be pending and
            undetermined in any court on the day before
            this Code, or any provision of this Code,
            takes effect.

The NRHA contends that the terms of Code § 1-9 preclude Code
§ 1-219.1 from having the effect of discontinuing the
condemnation proceedings, as they constitute a civil case
pending in court before Code § 1-219.1 took effect.
     Code § 1-9, however, protected pending "suits and
proceedings" on grounds not recognized under the new Code from
being discontinued with the General Assembly's enactment of the
Code of 1950, and is explicitly inapplicable to acts enacted
after the Code of 1950 took effect. Commission on Code
Recodification, Report to the Governor and General Assembly of
Virginia [Concerning Proposed Code of Virginia] (Dec. 15, 1947),
House Doc. No. 18 (1948), reprinted in Code of Virginia (1950)
Vol. 1, at ix-xxiii. Subsequent statutory enactments are
addressed by Code § 1-239, discussed in Part II.A.4., supra.

                                 13
July 1, 2010.    As a result, the NRHA's rights to the unblighted

Property owned by PKO were only prospective at the time that

Code § 1-219.1 became applicable to redevelopment and housing

authorities.    As in Marriott, the General Assembly only affected

the potential result of the NRHA's petition for condemnation by

enacting Code § 1-219.1.   The application of Code § 1-219.1 to

the NRHA therefore could not constitute a denial of vested

rights.

     The NRHA also contends that Code § 1-239 prohibits the

retroactive application of new statutes to impair substantive

rights that accrued before the new statute came into effect.

Consequently, the NRHA contends that its rights to the Property

by eminent domain could not be impaired by Code § 1-219.1

because they accrued prior to the effective date of Code § 1-

219.1.    We disagree.

     Code § 1-239 states, in relevant part:

              No new act of the General Assembly shall
            be construed . . . to affect . . . any
            right accrued, or claim arising before the
            new act of the General Assembly takes
            effect; except that the proceedings
            thereafter held shall conform, so far as
            practicable, to the laws in force at the
            time of such proceedings.

As aforementioned, the NRHA did not hold any rights to the

Property when Code § 1-219.1 became applicable to terminate a

                                 14
redevelopment and housing authority's power to acquire property

that is not itself blighted.

        Code § 1-219.1 did not affect a "claim arising" before it

took effect.    As discussed in Part II.A.2., supra, the Court

"appl[ies] the plain language of a statute unless the terms are

ambiguous."     Boynton, 271 Va. at 227, 623 S.E.2d at 926.   The

terms of Code § 1-239 are not ambiguous.    Code § 1-219.1 became

effective, in its entirety, on July 1, 2007.    When the NRHA

filed its petition to condemn the Property in April 2010, its

ability to acquire the Property was unencumbered.    The NRHA

simply failed to acquire the Property, an unblighted individual

property, before July 1, 2010, when blight became a requirement

for acquisition of property within the Redevelopment Project

area.

        Paragraph 3 of Chapter 882 indicates that, "until July 1,

2010, the provisions of this act shall not affect the ability of

a redevelopment and housing authority organized pursuant to

Title 36 of the Code of Virginia to acquire property pursuant to

any redevelopment or conservation plan adopted prior to January

1, 2007."    (Emphasis added.)   While the terms of Code § 1-219.1

limit the NRHA's ability to acquire unblighted property within a

blighted area after July 1, 2010, any claims arising after the

effective date of Code § 1-219.1 on July 1, 2007 did not arise

                                  15
"before the new act of the General Assembly," i.e., Code § 1-

219.1, took effect.    Code § 1-239.

       The NRHA's claim arose in April 2010, when it filed its

petition for condemnation.    Because the petition was filed after

July 1, 2007, the claim arose after Code § 1-219.1 was enacted

and was not affected by Code § 1-219.1 in violation of Code § 1-

239.

B.     Other Issues

       PKO also contends that the circuit court erred when it (1)

ruled that the subject Property was in a blighted area, (2)

struck PKO's due process objection, and (3) applied the doctrine

of stare decisis to hold that the NRHA was permitted to make a

finding of blight.    In light of our decision that the circuit

court erred by permitting the NRHA to acquire the Property under

the authority of Code § 36-49 after the July 1, 2010 deadline,

we will not discuss these remaining assignments of error.

                           III.   Conclusion

       For the reasons stated, we hold that the circuit court

erred in permitting the NRHA to acquire PKO's Property after the

effective date of the July 1, 2010 statutory limitation

prescribed by Code § 1-219.1.     We will reverse the judgment of

the circuit court and enter final judgment in favor of PKO.

                                        Reversed and final judgment.

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