Court Opinion

ID: 4233016
Source: CourtListenerOpinion
Date Created: 2017-12-28 16:10:34.569569+00
Date Added: 2024-06-11T14:43:16.999053
License: Public Domain

FILED
                                                                 Dec 28 2017, 6:34 am

                                                                     CLERK
                                                                 Indiana Supreme Court
                                                                    Court of Appeals
                                                                      and Tax Court

ATTORNEYS FOR APPELLANTS                                  ATTORNEYS FOR APPELLEE
David A. Given                                            Curtis T. Hill, Jr.
Brian J. Paul                                             Attorney General of Indiana
Matthew C. Olsen
Faegre Baker Daniels LLP                                  Andrea E. Rahman
Indianapolis, Indiana                                     Deputy Attorney General
                                                          Indianapolis, Indiana

                                            IN THE
    COURT OF APPEALS OF INDIANA

Coutar Remainder I, LLC,                                  December 28, 2017
Kooshtard Property I, LLC,                                Court of Appeals Case No.
Mac’s Convenience Stores, LLC,                            53A01-1704-PL-798
f/k/a Bigfoot Food Stores, LLC,                           Appeal from the Monroe Circuit
and Union Fidelity Life                                   Court
Insurance Company,                                        The Honorable Frances G. Hill,
Appellants-Defendants,                                    Judge
                                                          Trial Court Cause No.
        v.                                                53C06-1402-PL-251

State of Indiana,
Appellee-Plaintiff.

Najam, Judge.

Court of Appeals of Indiana | Opinion 53A01-1704-PL-798 | December 28, 2017              Page 1 of 13
                                          Statement of the Case
[1]   Kooshtard Property I, LLC is the owner of the fee simple title to certain land in

      Monroe County that abuts Indiana State Road 37 between Bloomington and

      Martinsville (the “Kooshtard Property”). Coutar Remainder I, LLC holds a

      remainder interest in the Kooshtard Property, and Mac’s Convenience Stores,

      LLC, d/b/a Circle K, holds a leasehold interest.1 In 2014, the State initiated

      condemnation proceedings to take a parcel from the Kooshtard Property in

      connection with the State’s development of Interstate 69 over and along State

      Road 37. During those proceedings, the property owners (hereinafter

      collectively referred to as “Kooshtard”) asserted that the State’s development of

      Interstate 69 would eliminate access to the Kooshtard Property. The trial court

      disagreed and entered summary judgment for the State.

[2]   We hold that Kooshtard is entitled to a trial on damages on the State’s

      elimination of the Kooshtard Property’s access to State Road 37. In particular,

      Kooshtard’s chain of title includes a deed from a previous owner to the State,

      which is binding upon both Kooshtard and the State. The deed contains an

      access control line restriction as a covenant running with the land, and the

      restriction includes an exception or opening in the access control line, which

      provides the Kooshtard Property with a right of access to State Road 37. The

      State’s elimination of that opening constitutes the taking of a property right

      1
          Union Fidelity Life Insurance Company, a named defendant below, does not participate in this appeal.

      Court of Appeals of Indiana | Opinion 53A01-1704-PL-798 | December 28, 2017                     Page 2 of 13
      subject to compensation. As such, we reverse and remand for further

      proceedings.

                                   Facts and Procedural History2
[3]   In 1971, Jane Ellis deeded to the State a portion of certain real property she

      owned for the State’s construction of State Road 37 (“the first taking”). The

      Ellis deed provided that “all rights and easements of ingress and egress to, from,

      and across” State Road 37 “to and from the owner’s abutting lands” were

      permanently extinguished. Appellants’ App. Vol. II at 184. However, the deed

      also reserved to Ellis and her successors in title an opening of 77.59 feet in the

      State’s access control line to State Road 37. Id. at 185. The deed states that the

      access control line restriction, which includes an exception or opening, “shall be

      a covenant running with the land.” Id.

[4]   The deed “further” reserved to Ellis and her successors “access to a local service

      road” located within the State Road 37 right of way between the Ellis property

      line and the opening in the access control line. Id. From there, one could enter

      onto, or exit from, State Road 37. In 2001, Kooshtard became the successor in

      title, in relevant part, to the Ellis property as described in the 1971 Ellis deed.

[5]   The western boundary of the Kooshtard Property is contiguous to the eastern

      boundary of the State Road 37 right of way. At the southwest corner of the

      2
          We held oral argument on December 7, 2017, in the our courtroom in the State Capitol.

      Court of Appeals of Indiana | Opinion 53A01-1704-PL-798 | December 28, 2017                 Page 3 of 13
      Kooshtard Property, the property line turns and runs eastward for 57.88 feet

      and then abruptly turns southward for 60.39 feet. See Appellants’ App. Vol. IV

      at 221, 244. These courses are described in the affidavit of Kooshtard’s expert

      Rory O’Bryan as the “common north boundary line” and the “common east

      boundary line,” respectively. Id. at 244. There is no access control along these

      common boundary lines.

[6]   Sometime after the Ellis deed, the State conveyed control over the “local service

      road” mentioned in the deed to Monroe County, which the County now

      maintains as “Wayport Road.” Wayport Road abuts the Kooshtard property

      along the common north boundary line and the common east boundary line.

      At that location, Wayport Road lies adjacent and contiguous to the Kooshtard

      Property and entirely within the State Road 37 right of way.

[7]   Currently, whenever traffic travels east from State Road 37 to the Kooshtard

      Property or west from the Kooshtard property to State Road 37, the traffic

      utilizes both the State Road 37 right of way and the opening in the access

      control line and passes over Wayport Road where it meets the common north

      boundary line and the common east boundary line. Kooshtard’s right to utilize

      the right of way is based upon its common law status as an abutting property

      owner, and its right to utilize the opening in the access control line is based

      upon the covenant that runs with the land in the Ellis deed.

[8]   Between Bloomington and Martinsville, the State is converting State Road 37

      into Interstate 69. The State plans to close the opening in the access control line

      Court of Appeals of Indiana | Opinion 53A01-1704-PL-798 | December 28, 2017   Page 4 of 13
      at the Kooshtard Property created by the Ellis deed. In order to provide

      another route of access to and from the Kooshtard Property, the State plans to

      extend Wayport Road from its current location, where it abuts the common

      north boundary line and the common east boundary line, around the southern

      border of the Kooshtard Property and then to the north and east, where

      Wayport Road will connect with Sample Road. Sample Road will then have

      direct access to Interstate 69. The State’s new traffic plan will require drivers to

      travel an additional one-half mile between the Kooshtard Property and

      Interstate 69 when entering or leaving the entrance to the Kooshtard Property

      along the common north boundary line and the common east boundary line.

[9]   On February 11, 2014, the State filed a complaint to condemn a parcel to be

      taken from the Kooshtard Property in order to proceed with the project (“the

      second taking”). The State attached to its complaint a “right-of-way parcel

      plat” that indicates both the fee simple parcel to be taken and the opening in the

      access control line created by the Ellis deed “to be closed.” Appellants’ App.

      Vol. II at 38. Kooshtard answered that, in addition to the fee simple parcel, the

      closure of the access control line was a compensable taking. According to

      Kooshtard, the closure of the access control line would, in itself, result in more

      than $1.3 million in damages and the closure of a gas station and convenience

      store located on the property. The report of three court-appointed appraisers

      assessed the total amount of just compensation, including the fair market value

      of the fee simple parcel taken and damages to the residue, at $420,000, but the

      report did not consider closure of the opening.

      Court of Appeals of Indiana | Opinion 53A01-1704-PL-798 | December 28, 2017   Page 5 of 13
[10]   The State moved for summary judgment only on the grounds that the closure of

       the access control line was not, as a matter of law, a compensable taking given

       the proposed extension and routing of Wayport Road to Sample Road and

       Sample Road’s connection to Interstate 69. In response to the State’s motion,

       Kooshtard argued that the closure of the access control line

               goes to the ingress and egress. And so, it is a taking of that
               element of our property entrance . . . . It is fundamental to the
               property itself. And . . . when this property was first deeded
               by . . . Ellis, this was the only way out and it is still the only way
               out.

       Tr. at 36. The trial court agreed with the State that the closure of the access

       control line merely created a different route of travel to and from the Kooshtard

       property and, as such, did not constitute a taking. The court entered summary

       judgment and declared that its judgment was a final judgment. This appeal

       ensued in due course.

                                       Discussion and Decision
                                              Standard of Review

[11]   Kooshtard appeals the trial court’s entry of summary judgment for the State.

       We review the trial court’s grant or denial of summary judgment de novo. Doe v.

       Ind. Dep’t of Child Servs., 81 N.E.3d 199, 201 (Ind. 2017). We will affirm the

       entry of summary judgment only when the designated evidence reveals no

       genuine issue of material fact and entitles the moving party—here, the State—to

       judgment as a matter of law. Id. We also note that the trial court entered

       Court of Appeals of Indiana | Opinion 53A01-1704-PL-798 | December 28, 2017      Page 6 of 13
       detailed findings of fact and conclusions thereon in its summary judgment

       order. While such findings and conclusions are not required in a summary

       judgment and do not alter our standard of review, they are helpful on appeal for

       us to understand the reasoning of the trial court. See Knighten v. E. Chicago Hous.

       Auth., 45 N.E.3d 788, 791 (Ind. 2015).

[12]   As our Supreme Court has stated, “‘[a]lthough takings cases may be extremely

       fact sensitive, the ultimate application of constitutional provisions to an

       established set of facts involves a pure question of law.’” Biddle v. BAA

       Indianapolis, LLC, 860 N.E.2d 570, 575 (Ind. 2007) (quoting Taylor-Chalmers,

       Inc. v. Bd. of Comm’rs of LaPorte Cty., 474 N.E.2d 531, 536 (Ind. Ct. App. 1985)

       (Hoffman, J., concurring)). Indeed, as this Court has explained:

               As we have observed in the past, condemnation proceedings are
               comprised of two stages: (1) an initial or summary phase, and (2)
               the phase during which the fact finder determines damages. City
               of Hammond v. Marina Entm’t Complex, Inc., 733 N.E.2d 958, 966
               (Ind. Ct. App. 2000), trans. denied. “During the initial or
               summary phase of the proceedings, the action consists solely of
               legal issues which are decided by the trial court.” Id. “During
               the second stage of the condemnation proceedings the fact finder
               must determine the amount of damages sustained by the
               landowner.” Id.

       State v. Dunn, 888 N.E.2d 858, 861 (Ind. Ct. App. 2008), trans. denied. The

       initial phase is when the trial court must determine, as a matter of law, whether

       Court of Appeals of Indiana | Opinion 53A01-1704-PL-798 | December 28, 2017   Page 7 of 13
       a taking occurred.3 See id. “Whether a taking has occurred is a question of law,

       and we review questions of law de novo.” Id. (citing Biddle, 860 N.E.2d at 575;

       Bradley v. City of New Castle, 764 N.E.2d 212, 216 (Ind. 2002)).

                              Kooshtard is Entitled to a Trial on Damages

[13]   Article 1, Section 21 of the Indiana Constitution provides that “[n]o person’s

       property shall be taken by law, without just compensation; nor, except in case

       of the State, without such compensation first assessed and tendered.” The

       threshold question in determining whether a taking has occurred is whether the

       landowner has a “property interest in the property” that has been acquired by

       the State. Dunn, 888 N.E.2d at 862. “‘Property’ in its legal sense means a

       valuable right or interest in something rather than the thing itself, and is the

       right to possess, use and dispose of that something in such a manner as is not

       inconsistent with law.” Id. (citing State v. Ensley, 240 Ind. 472, 164 N.E.2d 342,

       348-49 (1960)).

[14]   The parties devote a substantial part of their briefs in disputing whether the facts

       establish that this is an “ingress/egress” case or a “traffic flow” case. See id. at

       863-64. We conclude, however, that this case is unique and unprecedented on

       3
         It is of no moment that Kooshtard’s allegation—that the closure of the access control line was a taking—
       was made in response to the State’s complaint for condemnation rather than as a freestanding complaint for
       inverse condemnation. Hammond, 733 N.E.2d at 966-67.

       Court of Appeals of Indiana | Opinion 53A01-1704-PL-798 | December 28, 2017                    Page 8 of 13
       its “established set of facts,” see Biddle, 860 N.E.2d at 575, in that, unlike any of

       the cases relied on by the parties, here the property owner’s deed expressly

       provides for the right of access that is now being taken. Specifically, the Ellis

       deed states that “the access control line restriction shall be a covenant running

       with the land,” and that restriction includes a 77.59-foot exception or opening

       in the metes and bounds description of the access control line to State Road 37.

       Appellants’ App. Vol. II at 184-85. A covenant running with the land

       “constitutes a compensable interest in land.” Dible v. City of Lafayette, 713
N.E.2d 269, 273-74 (Ind. 1999). Thus, under the 1971 Ellis deed, the opening

       is a property right that runs with the land for the use and benefit of Ellis and her

       successors in title, and Kooshtard is entitled as a matter of law to a trial on

       damages for the State’s elimination of the opening.

[15]   The State is also estopped in equity from asserting that the elimination of the

       opening is not compensable. The facts establish an estoppel by deed. A deed is

       in the nature of a contract between the grantor and the grantee. See, e.g., Fischer-

       Marsh v. Fischer, 822 N.E.2d 1055, 1062-63 (Ind. Ct. App. 2005). One who by

       deed or conduct has induced another to act in a particular manner will not be

       permitted to adopt an inconsistent position, attitude, or course of conduct that

       causes injury to such other. Brown v. Branch, 758 N.E.2d 48, 52 (Ind. 2001)

       (citing 31 C.J.S. Estoppel & Waiver § 2 (1996)). Here, the rights of ingress to and

       egress from the Kooshtard Property were documented in the 1971 Ellis deed at

       the time of the first taking and were a bargained-for exchange between Ellis and

       Court of Appeals of Indiana | Opinion 53A01-1704-PL-798 | December 28, 2017   Page 9 of 13
       the State. The consideration included an exception or opening in the access

       control line restriction, expressly designated as a covenant running with the

       land, which is a property right.

[16]   This is not the first encounter between the State and the owner of this property

       concerning the owner’s rights of ingress and egress. The Ellis deed shows as a

       matter of law that, in the first taking, the State agreed to a 77.59-foot opening in

       the access control line facing the Ellis property and that Ellis agreed to

       extinguish any and all other rights of ingress and egress along State Road 37.

       And, again, the deed stated that the access control line restriction—which

       included the opening in that line—“shall be a covenant running with the land.”

       Appellants’ App. Vol. II at 184-85. As such, the State may not now repudiate

       the Ellis deed and contend that the opening in the access control line is not a

       property right held by the current owner.

[17]   Nevertheless, the State contends that Kooshtard “only has a property right of

       ingress and egress to Wayport Road, not State Road 37.” Appellee’s Br. at 10.

       The State relies on the deed provision that states, “and further, the owner and

       her successors in title shall have access to a local service road where the owner’s

       remaining land [after the taking] abuts the above-described . . . courses.”

       Appellants’ App. Vol. II at 184-85 (capitalization removed). The State’s

       reliance on that provision is misplaced.

[18]   First, the term “and further” indicates that the “access to a local service road” is

       access in addition to something else, and the something else is the 77.59-foot

       Court of Appeals of Indiana | Opinion 53A01-1704-PL-798 | December 28, 2017   Page 10 of 13
       opening in the access control line as described in the metes and bounds

       description of that line. Second, and as previously noted, the local service road

       that is now Wayport Road was located entirely within the State Road 37 right

       of way adjacent and contiguous to the Ellis parcel. Thus, the provision that

       “the owner shall have access to a local service road” merely reaffirmed that the

       taking and restrictions documented in the deed did not restrict the owner’s

       common law right of access to the State Road 37 right of way across the 57.88-

       foot common north boundary line and the 60.39-foot common east boundary

       line, which the Ellis property shared with the right of way. While this provision

       underscores the owner’s right of immediate access to the right of way, which

       leads directly to the opening in the access control line, it was legal surplusage

       because Ellis had a common law right of access to the right of way at that

       location as an abutting property owner. As our Supreme Court stated in Ensley:

       “[A]n abutting property owner has an easement of ingress and egress in a public

       highway and this constitutes a property right which cannot be substantially or

       materially interfered with or taken away without due compensation.” 164
N.E.2d at 349. In other words, the Ellis deed reserves to the property owner a

       complete means of direct access over and across the State Road 37 right of way

       through the opening in the access control line to State Road 37 itself.

[19]   We caution that our holding is simply that Kooshtard is entitled to a trial on

       damages for the State’s taking of Kooshtard’s property right in the opening in

       the access control line. We express no opinion on the amount of damages, if

       any, a fact finder might assess against the State for this particular taking. There

       Court of Appeals of Indiana | Opinion 53A01-1704-PL-798 | December 28, 2017   Page 11 of 13
       is a significant disparity between Kooshtard’s claim of damages and the report

       of the court-appointed appraisers, but that disparity is not an issue on appeal.

       The question presented here is only whether a taking occurred. As we recently

       explained in AAA Federal Credit Union v. Indiana Department of Transportation, we

       will not “conflate[] the measure of damages for a compensable taking with the

       inquiry into whether such a taking happened at all.” 79 N.E.3d 401, 406 (Ind.

       Ct. App. 2017), trans. denied.

[20]   In sum, we agree with Kooshtard that the opening in the access control line is a

       property right. The State has taken Kooshtard’s right to the use and benefit of

       the opening in the access control line contained in the 1971 Ellis deed. In the

       first taking, Ellis bargained for direct access to State Road 37 as a covenant

       running with the land, and her successors in title are entitled to the benefit of

       her bargain, which includes damages, if any, for the elimination of that property

       right by the second taking. The fact that the State may provide an alternate

       means of access to and from the Kooshtard Property does not obviate the fact

       that the opening in the access control line is a covenant running with the land,

       and the State’s elimination of the opening is a compensable taking. Thus, as a

       matter of both law and equity, Kooshtard is entitled to a trial on damages for

       the closure of the access control line. Accordingly, we reverse the trial court’s

       entry of summary judgment for the State, and we remand for further

       proceedings.

[21]   Reversed and remanded.

       Court of Appeals of Indiana | Opinion 53A01-1704-PL-798 | December 28, 2017   Page 12 of 13
Kirsch, J., and Brown, J., concur.

Court of Appeals of Indiana | Opinion 53A01-1704-PL-798 | December 28, 2017   Page 13 of 13