Present: All the Justices
RICHMOND, FREDERICKSBURG
& POTOMAC RAILROAD
COMPANY, ET AL.
OPINION BY JUSTICE A. CHRISTIAN COMPTON
v. Record No. 950799 March 1, 1996
METROPOLITAN WASHINGTON
AIRPORTS AUTHORITY
FROM THE CIRCUIT COURT OF ARLINGTON COUNTY
Paul F. Sheridan, Judge
In this inverse condemnation case, a landowner seeks a
determination in a declaratory judgment proceeding under Code
§ 8.01-187 that its private property has been taken or damaged
for public use without just compensation, within the meaning of
Article I, Section 11 of the Constitution of Virginia.
Appellants Richmond, Fredericksburg & Potomac Railroad
Company and RF&P Properties, Inc. (collectively RF&P), instituted
this action as of July 1, 1992 against appellee Metropolitan
Washington Airports Authority. The Authority, an interstate
compact entity with the District of Columbia, was created in 1985
to acquire Washington National Airport and Washington Dulles
International Airport from the federal government and to operate
the respective facilities. Acts 1985, ch. 598. The Authority
has the power of eminent domain. Id. § 9.
The subject property is a tract of approximately 41 acres
owned by RF&P in Arlington County. The land lies north of
Crystal City and lies adjacent on the north northwest to National
Airport. About 17 acres of the property lie in the "clear zone"
of the Airport's Runway 15/33.
A clear zone, also called a "runway protection zone," is an
area at ground level in which the Federal Aviation Administration
(FAA) prohibits any development that would attract a
"congregation of people." The type of development prohibited in
airport clear zones includes office buildings and shopping
centers. The clear zone for this runway was designated by the
FAA as an area at ground level in the shape of a trapezoid,
beginning 200 feet from the end of the runway with a base width
of 1,000 feet, extending out for 1,700 feet to an outer width of
1,425 feet.
In an amended motion for judgment, RF&P alleged that the
Authority, in order to qualify for grant funds under certain
federal statutes, was required to give assurances to the FAA that
it would obtain either a fee interest "or a strict land use and
avigation easement" over National Airport's clear zone. The RF&P
alleged that because National Airport was federally owned and
operated until 1987, when the Authority began the Airport's
operation, it had no occasion before that time to participate in
the various federal grant programs, and thus was not bound to
"enforce" the FAA's clear zone policy. The RF&P alleged that
after the Authority assumed operating control over the Airport,
the Authority became obligated to "implement" the FAA's clear
zone policy in order to be eligible for federal funding.
The RF&P further alleged that the subject property is zoned
by the County for industrial development, designated M-1 and M-2.
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It asserted that the property's highest and best use is for
operation of commercial office buildings, noting that Crystal
City office space has a low vacancy rate because of its proximity
to the Pentagon and downtown Washington, D.C.
The RF&P further alleged that it entered into a joint
venture agreement in 1986 with the Charles E. Smith Companies to
develop an office complex on the subject property. (References
in this opinion to "RF&P" in connection with efforts to develop
the property will include the Smith Companies.) In the
beginning, ten office buildings were planned, as well as
construction of above and below ground parking, sidewalks,
driveways, and street lighting.
The RF&P further alleged that, beginning in October 1986, it
commenced filing the appropriate documents with the FAA seeking a
"no hazard determination," that is, a ruling that its building
proposal did not constitute a hazard to air navigation.
According to the allegations, the FAA conducted studies and found
that a majority of the proposed buildings exceeded FAA height
limitations. But the FAA said that even if the building heights
were lowered, it would still object to the proposed development
because it would introduce a congregation of people into the
clear zone.
The RF&P also asserted that it submitted revised proposals
to the FAA in July 1987, January 1988, and August 1988. In the
final proposal, no occupied buildings were in the clear zone,
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only a local access road, surface and underground parking, trees,
and lights. Finally, RF&P asserted, the FAA issued a "no hazard
determination" in September 1988 to expire in March 1990.
The RF&P also alleged that at the time it "was being
pressured by the FAA to cancel its plans for development in the
Clear Zone," another landowner began formulating its own plans
for development in the immediate area. Vector-Schafran, a
partnership, owned a one-acre parcel adjacent to the subject
property; almost all of the one acre is within the clear zone.
In September 1988, according to the allegations, after Vector-
Schafran submitted revised plans, the FAA issued a no hazard
determination but said it discouraged development because a
congregation of people would be introduced into the clear zone.
The RF&P further alleged that in mid-1988 the Authority "had
resisted the FAA's pressure to force it to obtain property
interests sufficient to control the Clear Zone." But, RF&P
asserted, this resistance "began to erode in late 1988." The
RF&P asserted the Authority then began to implement a plan for
"massive redevelopment" of National Airport. Under the federal
funding statutes, according to the allegations, the Authority was
eligible to receive 75 per cent of the costs for certain aspects
of the redevelopment from the FAA. Thus, RF&P alleged, the
proposed developments by it and Vector-Schafran caused the FAA
"to exert increasing pressure" on the Authority to acquire either
fee interests or land and avigation easements in the clear zone.
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As a result, RF&P asserted, a conditional letter of intent
was executed on September 30, 1989 between RF&P and the
Authority. In the letter, according to the allegations, RF&P
"promised to convey a strict use easement" to the Authority upon
commencement of the development. The proposed easement, RF&P
asserted, did not permit development in the clear zone, except
for roadways, parking, street lighting and "infrastructure
support." The letter provided that it would terminate if the
RF&P determined not to proceed with the development.
Subsequently, RF&P alleged, the Authority applied for
federal grant funds, giving "assurances" in grant agreements in
1990, 1991, and 1992 that it would obtain land use and avigation
easements over the clear zone portion of RF&P's property.
The RF&P further alleged that, after the FAA approved its
revised plan in September 1988, RF&P attempted to make the
development plan "economically viable." It alleged that because
of the Authority's "obligation to prevent viable development in
the Clear Zone," RF&P was not able to "implement" its plan. The
September 1989 letter of intent "lapsed," RF&P alleged, when it
determined that the development could not proceed and, at that
time, "a date no later than November 1991," RF&P was returned to
its "status immediately prior to the execution of the letter of
intent."
Further, RF&P alleged, the Authority, through delay of
initiation of condemnation proceedings, attempted to "drive down"
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the value of the Vector-Schafran property. In 1992, RF&P
asserted, the Authority condemned the property and took fee title
to it.
Articulating its inverse condemnation claim in the amended
motion for judgment, RF&P alleged that when the conditional
letter of intent lapsed, the Authority "was obligated by
applicable law either to negotiate just compensation with [the
RF&P] or to determine just compensation through formal
condemnation proceedings." Continuing, RF&P asserted that the
Authority "has not negotiated such just compensation, has not
initiated such condemnation proceedings, and has not returned its
[federal] funding to the FAA."
The inverse condemnation action included a so-called
"overflights" claim in addition to the claim that the Authority
was "using" the subject property as a clear zone at ground level.
The RF&P alleged the Authority has taken RF&P's "airspace for
its own use," asserting that "the frequency of flights" over
RF&P's property "increased from 1989 to 1990" and that this use
"has caused noise, vibrations, fumes, dust and fuel particulates
emissions on the Property."
The RF&P alleged that the Authority's "actions" regarding
the overflights and the use of the clear zone have resulted in a
taking of the property in the clear zone. It also asserted that
the taking occurred on or about October 20, 1989, or in the
alternative, at such time as the Authority executed its first
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grant agreement for federal funds for National Airport. Thus,
RF&P sought a declaration that a taking had occurred on the date
alleged, sought the appointment of commissioners to determine the
compensation to which it is entitled, and sought an award of
costs and attorney's fees.
Subsequently, the trial court overruled demurrers filed by
the Authority to the amended motion for judgment. In a February
1994 order memorializing that ruling, the court concluded that
RF&P had made allegations sufficient to state "a takings and/or
damage claim based on overflights of aircraft," and a "separate
inverse condemnation claim based on [the Authority's] alleged
actions with respect to the purported imposition of the `clear
zone' allegedly causing damages and/or a taking" of the RF&P's
property.
Later, the Authority filed a motion for partial summary
judgment directed to the overflights claim. The Authority argued
that the claim was barred by the three-year statute of
limitations applicable to inverse condemnation actions. See
Prendergast v. Northern Virginia Regional Park Auth., 227 Va.
190, 194-95, 313 S.E.2d 399, 402 (1984). The Authority asserted
that RF&P, limited by the trial court to evidence of overflights
already developed during discovery, was unable to establish that
flights over the subject property had increased in frequency or
changed in character during the three-year period prior to the
date the action was instituted, that is, between July 1, 1989 and
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July 1, 1992.
Following argument in November 1994, the trial court granted
the motion. The court ruled that, "as a severable cause of
action, the overflight issue is barred by the statute of
limitations." The trial court indicated at the time of this
ruling, however, that overflights evidence would probably be
admissible on the "other alleged takings" claim.
Subsequently, following a six-day bench trial in which the
testimony of 18 witnesses was presented and more than 100
exhibits were considered, the trial judge asked the parties to
submit proposed findings of fact and conclusions of law. After
conducting a thorough review of the parties' proposals, the judge
revised, deleted, and adopted language to articulate precisely
the facts that he found from all the evidence adduced at trial.
The trial judge, in a 57-page document, ruled in favor of
the Authority. He made 87 findings of fact, adopted 71
conclusions of law (many of which also contain factual findings),
and set forth a summary of his reasoning underlying the findings
and conclusions. The court held that the Authority did nothing
to take or damage RF&P's property. In an alternative holding,
the court held that even if a taking or damage had been
established, the clear-zone claim was time-barred. The trial
court incorporated the document in a January 1995 order entering
judgment for the Authority. The RF&P appeals.
Although some of the evidence was conflicting, RF&P
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understandably does not challenge on appeal any of the trial
court's detailed findings of fact. Indeed, on brief RF&P says,
"None of the central facts in this case [is] in dispute."
Therefore, applying settled appellate principles, we shall recite
the evidence, and all reasonable inferences flowing from the
evidence, in a light most favorable to the Authority which
prevailed in the trial court. Additionally, we shall recite the
voluminous evidence in summary fashion and in no more detail than
is necessary to illuminate the questions of law presented.
In June 1986, when the RF&P and the Smith Companies agreed
to explore development of the subject property, they knew about a
planned consolidation of Navy Department offices in the area.
The hope was that a development on the property could be offered
in response to an expected Navy Solicitation for Offers (SFO).
During the period after the Authority was created and before
the RF&P finally obtained a no hazard determination from the FAA,
there was an ongoing debate between the Authority and the FAA
whether the Authority was legally required, based on federal
regulations, to acquire appropriate property interests in the
Runway 15/33 clear zone as a condition for receipt of federal
funding. William A. Whittle, manager of the FAA's Washington
Airports District Office, was of opinion that the Authority was
required to acquire such interests. The Authority's general
manager took the position there was no such requirement.
After RF&P's July 1987 revised submission, when it had been
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advised of the dimensions and location of the clear zone, RF&P
volunteered to the FAA that it would grant an avigation easement
to the Authority over a portion of the clear zone. An officer of
the Smith Companies testified, "we felt that this was a political
move for us to be making. That we could resolve the issues here
by our willingness to give control to the Airports Authority."
Just prior to RF&P's third submission to the FAA,
representatives of RF&P met with representatives of the Authority
in November 1987 seeking formal support for the proposed
development. The RF&P offered to grant the Authority an
avigation easement over the clear zone in exchange for support,
and the Authority agreed. When RF&P submitted its revised plan
in January 1988, it formally proffered to the FAA its intent to
grant an easement to the Authority over the entire clear zone.
At the time, RF&P's counsel contended that the Authority was not
legally obligated to acquire the clear zone as a condition for
receipt of federal funding.
In February 1988, the FAA, in a "Current Issues Report,"
stated its intent to "pressure" the Authority to acquire
interests in the clear zone. In a similar report issued two
months later, the FAA reported that the Authority had not acceded
to FAA pressure to acquire such interests.
In August 1988, the FAA sent RF&P a qualified no hazard
letter stating that its most recent submission did not violate
FAA height restrictions; it expressed opposition to the proposed
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construction, however, because two buildings were still planned
for the clear zone. In the letter, the FAA admitted, however,
that it had no legal basis to prohibit the development because
the Authority "does not have control of the area in question."
After receiving this qualified no hazard determination, RF&P
decided it could not move forward with the development.
Specifically, RF&P feared it would not be able to obtain zoning
approval or a building permit from the County because of the
FAA's reservations expressed in the August letter; it would not
be able to obtain financing and insurance due to the FAA's
reservations about proposed construction in the clear zone; and
it might receive adverse publicity and suffer substantial harm to
its reputation were it to ignore the FAA's admonition.
Later in August 1988, RF&P submitted another revised
proposal. It called for construction of six buildings, all
outside the clear zone. The revision included the same proffer
to grant the avigation easement contained in the prior
submission. Subsequently, the FAA issued an unqualified no
hazard letter to RF&P approving the last submission.
On September 1, 1988, Vector-Schafran submitted to the FAA a
notice of proposed construction for an office building on its
one-acre parcel. In November 1988, the FAA notified Vector-
Schafran that its proposed building violated its clear zone
policy.
During April and May 1989, the Authority supported the
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RF&P's efforts to move forward with its development. Among other
things, the Authority resisted the effort of the "National
Capital Planning Commission" to adopt its own clear zone policy
to include property beyond 1,900 feet from the end of Runway
15/33.
Following negotiations during July, August, and September
1989, the parties executed the conditional Letter of Intent to
Grant Easement on September 30, 1989. The Authority agreed to
acquire for $2,000 the avigation easement conditionally offered
by the RF&P. The letter of intent was revocable at the will of
RF&P and was expressly conditioned on RF&P's ability to obtain
all necessary government approvals for development. Later, RF&P
"terminated" the letter.
In October 1989, the Defense Department, Navy Department,
and General Services Administration issued an SFO seeking three
million square feet of office space to house consolidated Navy
command offices in a single development. The RF&P recognized
that the foregoing entities would not consider the subject
property because so much of it was inside the clear zone, fixed
by the Navy at 3,000 feet in length.
When RF&P recognized that the government was not interested
in the subject property, it became concerned the Navy might leave
existing office space that it was occupying in Crystal City and
consolidate elsewhere, causing many other Crystal City tenants to
leave as well. According to an officer of the Smith Companies,
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"a great deal of vacated office space in the Crystal City area
. . . would have meant that any venture into a new development
would have been foolhardy." Therefore, RF&P abandoned its plans
to proceed with the development of a speculative office complex
on the subject property.
In March 1991, Hydrosystems, Inc., completed a report of
investigation requested by RF&P relating to contamination of
about six acres of the subject property (four of which are in the
clear zone). The investigation, conducted in cooperation with
the Virginia Department of Waste Management, revealed severe
contamination in the soil and groundwater.
In April 1991, the Authority filed its petition to condemn
the Vector-Schafran property which culminated in a purchase
agreement to transfer the property to the Authority in December
1992.
In October 1991, RF&P granted CSX Transportation, Inc., a
permanent easement for use of a railroad corridor. Of the 17
acres in the clear zone, five are within the corridor. The
easement prohibits RF&P from building in the corridor.
The RF&P continues to earn substantial profits from
commercial leases on the subject property. Over $600,000 annual
net rental income was earned during the year before and during
the year following the alleged taking. Also, the evidence shows
that the clear zone property retains significant market value for
uses that do not conflict with the FAA clear zone policy. If
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only used for parking, the property is worth $400,000 to $450,000
per acre.
There are other factors which affect the economic viability
of development of the subject property. For example, the
railroad corridor is further encumbered by a 1938 Indenture in
favor of the United States which provides, in part, that
ownership of the corridor will revert to the United States in the
event the corridor is used for any purpose other than railroad
operations. Also, approximately 5.5 acres of the subject
property is leased to the Solite Corporation, which operates a
concrete batching plant on the land. The lease does not expire
until April 2000. The majority of the 5.5 acres is in the clear
zone. Additionally, because of a high water table on the subject
property, a large amount of subsurface parking would be so
expensive to provide as to question the economic return on office
development. Also, development of the four acres of contaminated
land would be "impossible" without appropriate remediation
efforts costing millions of dollars.
Finally, the trial court stated that it did not find the
subject property had "a negative development potential," but that
it had some value for purposes of liability in an inverse
condemnation action.
In its conclusions of law, the trial court ruled that the
Authority did "nothing" to take or damage RF&P's property. Also,
the court ruled that the Authority was not legally obligated "to
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do anything" with respect to the property, because FAA policy
does not require the Authority to acquire control over property
within the Runway 15/33 clear zone.
Additionally, the court decided that RF&P has suffered no
compensable interference with its property rights. The court
noted that RF&P's claim is primarily based on the allegation that
the FAA clear zone policy has frustrated its plans to place an
office development on the property, but it "does not -- and
cannot -- claim that the FAA clear zone interferes with the
present uses of the property."
Finally, the trial court determined that even if the RF&P
had established a taking, its claim against the Authority would
be time-barred.
On appeal, the RF&P assigns the following errors: the trial
court erred in holding that the Authority did nothing to take or
damage RF&P's property within the meaning of Article I, Section
11 of the Constitution; the trial court erred in holding that,
even if it had established a taking or damage, the clear-zone
claim was time-barred; and the trial court erred in holding that
the separate "overflights" claim was time-barred. Because of the
view we take of the merits of RF&P's inverse condemnation claim,
we do not reach the statute of limitations questions.
When a case is decided by a trial court without the
intervention of a jury, the court's judgment will not be set
aside "unless it appears from the evidence that such judgment is
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plainly wrong or without evidence to support it." Code § 8.01-
680. The trial court's ruling on the merits is fully supported
by the evidence.
Article I, Section 11 of the Constitution of Virginia
provides that the General Assembly shall not pass any law
"whereby private property shall be taken or damaged for public
uses, without just compensation." This section is self-executing
and permits the landowner to enforce its constitutional right to
compensation in a common law action based upon implied contract,
Burns v. Board of Supervisors of Fairfax County, 218 Va. 625,
627, 238 S.E.2d 823, 825 (1977), both where the property is taken
for public use and where it is damaged for public use. Jenkins
v. County of Shenandoah, 246 Va. 467, 470, 436 S.E.2d 607, 609
(1993).
In the present case, we hold RF&P failed to establish that
any taking or damage by the Authority occurred, either any taking
or damage of the land within the clear zone or any taking or
damage of the airspace above the clear zone.
The gist of the RF&P's claim is that actions of the
Authority prevented it from developing the subject property.
Upon the clear zone aspect of the claim, RF&P asserts the
Authority had committed to acquire the property as a requirement
for federal funding. The trial court properly concluded,
however, that no such requirement existed. The court found that
the opinion to the contrary of the FAA's Whittle was unsupported
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by other FAA testimony. Indeed, the Authority constantly
resisted pressure from the FAA to acquire the clear zone
property, finally accepting RF&P's offer to sell for $2,000 an
easement over the clear zone. Furthermore, the September 1989
conditional letter of intent, which would have allowed use of the
clear zone to support RF&P's non-clear zone land, was purely
voluntary on RF&P's part. Significantly, the trial court found
that the Authority's acts taken subsequent to execution of the
letter of intent, including acquisition of Vector-Schafran's
parcel, did not constitute a commitment to acquire RF&P's land.
Furthermore, the record is clear that the Authority did not
take RF&P's land by "using" it, either for overflights or as a
runway protection zone. Relating to the overflights, the record
merely shows that, since at least 1984, approximately 23,000
aircraft annually have flown over the property using Runway
15/33. During a pretrial hearing, RF&P's attorney stated to the
trial court that RF&P had no additional evidence to support its
overflights claim. Subsequently, RF&P never offered, or
attempted to offer, any evidence about, for example, the types of
aircraft using the runway, the height at which they passed over
the property, or the frequency of landings, to support its
allegations in the amended motion for judgment that overflights
caused "noise, vibrations, fumes, dust and fuel particulates
emissions on the Property." "Flights over private land are not a
taking, unless they are so low and so frequent as to be a direct
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and immediate interference with the enjoyment and use of the
land." United States v. Causby, 328 U.S. 256, 266 (1946).
Manifestly, there has been no showing that an invasion of the
RF&P's airspace rights occurred. And, the clear zone
requirements of the Navy and the National Capital Planning
Commission, relied on by RF&P, do not dictate a different
conclusion.
Relating to the alleged "use" of the clear zone, the crux of
RF&P's claim is found in paragraph 83 of the amended motion for
judgment. It alleged that the Authority had inversely condemned
17 acres of its land when the Authority "represented and
warranted to the FAA . . . that it had control over [RF&P's]
Property," or alternatively, when the Authority executed grant
agreements for federal funds. As a result, the allegation
continued, the Authority "became bound by applicable law either
to condemn the portion of [RF&P's] Property located in the Clear
Zone, or obtain strict land use and avigation easements for that
portion of the Property."
Actually, this is a contention that the Authority "used" the
clear zone because it allegedly prevented RF&P from developing
office buildings on the property. The record fully supports the
trial court's holding that the Authority took no action to
prevent the development nor did it threaten RF&P with
condemnation. On the contrary, the record shows that the
Authority actively assisted the RF&P's development efforts. The
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record is clear that RF&P abandoned its plans for the commercial
development due to adverse market conditions and physical
problems with the property, not because of any interference by
the Authority.
Finally, we have not overlooked the fact that, because of
its statute of limitations ruling on the overflights claim, the
trial court did not explicitly address the merits of that claim
after hearing all the evidence. Even if we were to agree with
RF&P that the trial court erred in ruling the claim was time-
barred, reversal of the judgment is not required. "We do not
hesitate, in a proper case, where the correct conclusion has been
reached but the wrong reason given, to sustain the result and
assign the right ground." Robbins v. Grimes, 211 Va. 97, 100,
175 S.E.2d 246, 248 (1970). Accord Doswell Ltd. Partnership v.
Virginia Elec. & Power Co., 251 Va. ___, ___, ___ S.E.2d ___, ___
(1996), decided today. This is such a case.
Consequently, we hold there is no reversible error in the
judgment of the trial court, and it will be
Affirmed.
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