131 Nev., Advance Opinion 41
IN THE SUPREME COURT OF THE STATE OF NEVADA
THE STATE OF NEVADA, ON No. 63179
RELATION OF ITS DEPARTMENT OF
TRANSPORTATION,
Petitioner, FILED
vs. JUN 2 5 2015
THE EIGHTH JUDICIAL DISTRICT
7,1E N. LINDEMAN
COURT OF THE STATE OF NEVADA, ,...juk
IN AND FOR THE COUNTY OF BY
CHIEE D CLERK
CLARK; AND THE HONORABLE
ALLAN R. EARL, DISTRICT JUDGE,
Respondents,
and
AD AMERICA, INC., A NEVADA
CORPORATION,
Real Party in Interest.
Original petition for a writ of mandamus or prohibition
challenging a district court partial summary judgment in an inverse
condemnation proceeding.
Petition granted.
Adam Laxalt, Attorney General, and Dennis Gallagher, Chief Deputy
Attorney General, Carson City; Lemons, Grundy & Eisenberg and Robert
L. Eisenberg, Reno; Chapman Law Firm, P.C., and Michael G. Chapman
and Erich N. Storm, Las Vegas,
for Petitioner.
Law Offices of Brian C. Padgett and Brian C. Padgett and John P.
Shannon, Las Vegas; Leach Johnson Song & Gruchow and Kirby C.
Gruchow, Jr., Las Vegas,
for Real Party in Interest.
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1 -1 11-cics
Law Offices of Kermitt L. Waters and Kermitt L. Waters, James Jack
Leavitt, Michael A. Schneider, and Autumn L. Waters, Las Vegas,
for Amici Curiae People's Initiative to Stop the Taking of Our Land and
Carrie L. Jenkins.
BEFORE THE COURT EN BMW.
OPINION
By the Court, DOUGLAS, J.:
In this opinion, we consider whether the district court erred by
determining that Nevada's Department of Transportation (NDOT) owes
just compensation for taking Ad America's property in conjunction with
Project Neon, a freeway improvement plan, based on NDOT's and the City
of Las Vegas' precondemnation activities. Specifically, we address
whether a taking occurred under either the United States or Nevada
Constitutions because NDOT publicly disclosed its plan to acquire Ad
America's property to comply with federal law, the City independently
acquired property that was previously a part of Project Neon, and the City
rendered land-use application deCisions conditioned on coordination with
NDOT for purposes of Project Neon. We conclude that the district court
erred by conflating Nevada's precondemnation damages standard with
takings law, and that, after applying the correct law, no taking of Ad
America's property occurred. Accordingly, we grant the petition.
FACTUAL AND PROCEDURAL HISTORY
Project Neon
Petitioner NDOT is the lead agency for Project Neon, a six-
phase, 20- to 25-year freeway improvement project for the Interstate
Highway 15 (I-15) corridor between Sahara Avenue and the U.S. Route
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95/I-15 interchange in Las Vegas. With an estimated cost of between $1.3
and $1.8 billion dollars, the completion of Project Neon depends primarily
on funding from the Federal Highway Association (FHWA). To procure
this funding, NDOT complied with the National Environmental Policy Act
(NEPA) by performing an environmental assessment of Project Neon
between 2003 and 2009. NEPA required NDOT to publicly release all
reasonable development alternatives it was considering for public
comment. Each of these alternatives included the commercial rental
property owned by real party in interest, Ad America.
Based on the results of the environmental assessment, NEPA
also required NDOT to complete an environmental impact statement
(EIS). In 2011, after the approval of the EIS, FHWA allocated $203
million to NDOT for Phase 1 of Project Neon. Notably, at that time,
NDOT did not anticipate acquiring Ad America's property for another 17
years during Phase 5, assuming funding was available.
To reduce the impacts associated with Project Neon, NDOT
coordinated efforts with the City of Las Vegas and other agencies.
Anticipating the development of an arterial improvement (the MLK
Connector) that is no longer a part of Project Neon, the City amended its
Master Plan to allow for certain road widening and, on October 24, 2007,
purchased a tract of land from a private party. Additionally, the City
approved 19 land-use applications for development rights of properties in
proximity to Project Neon."
'In several instances, the City conditioned its approval of land-use
applications on coordination with NDOT. In all but one of these cases, the
City removed those conditions. The City also tabled three land-use
continued on next page . .
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Ad America
Ad America acquired its property between 2004 and 2005,
planning to redevelop existing business space into higher-end commercial
offices with multilevel parking. To that end, Ad America hired a surveyor
and architect, the latter having drafted a preliminary design. Ad America
then retained a political consultant to obtain necessary development
permits. After speaking with members of the City Planning Department
and one City Council member, the consultant opined that there was a de
facto moratorium on development in the path of Project Neon. Based on
this opinion, Ad America chose not to submit development applications for
its property.
In October 2007, Ad America began informing its tenants that
its property would be acquired for Project Neon. Although Ad America's
net rental income remained steady from 2007 to 2010, it decreased by
approximately 37 percent in 2011. 2 Ad America has not had its property
appraised or attempted to sell it. As of August 2012, Ad America could no
longer meet its mortgage commitments.
. • . continued
applications because of concerns for aesthetics and potential conflicts with
Project Neon, among other things.
2Ad America's tenant occupancy remained steady from 2007 to 2009,
decreasing by approximately 36 percent (four tenants) in 2010. Ad
America provided affidavits from two of its former tenants indicating that
they did not renew their rental leases because of Project Neon. The record
provides no data for net rental income or tenant occupancy for any period
before 2007, making it impossible to assess any diminution of these values
occurring between 2005 and 2007.
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Procedural history
Ad America filed an inverse condemnation action against
NDOT in the District Court of Clark County, Nevada, seeking
precondemnation damages for alleged economic harm and just
compensation for the alleged taking of its property. 3 Thereafter, NDOT
filed a motion in the district court for a determination that the valuation
date for purposes of the inverse condemnation action was May 3, 2011, the
date Ad America served its summons and complaint. Ad America filed an
opposition to that motion and included a countermotion to set a valuation
date of October 24, 2007, the date it alleged that the acquisition of
property for Project Neon began. NDOT interpreted Ad America's
countermotion to include a motion for summary judgment on the takings
issue and filed an opposition to Ad America's countermotion proposing the
valuation date and a countermotion for summary judgment on the takings
issue.
Ultimately, the district court granted Ad America's summary
judgment requests and denied NDOT's summary judgment requests. 4 In
its order, the district court attributed the City of Las Vegas' actions,
3 The City of Las Vegas was listed as a party to the action but never
served.
4Althoughthe district court's order was somewhat opaque about its
granting summary judgment in favor of Ad America on the takings issue,
our review of the hearing transcripts confirms that this was the district
court's intended disposition. See Oxbow Constr. v. Eighth Judicial Dist.
Court, 130 Nev., Adv. Op. 86, 335 P.3d 1234, 1240 (2014) ("When a district
court's order is unclear, its interpretation is a question of law that we
review de novo.").
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including its purchase of property and land-use decisions, to NDOT and
determined that NDOT committed a taking of Ad America's property on
October 24, 2007. 5 At the time of this decision, it was undisputed that
NDOT had not physically occupied Ad America's property, passed any
regulation or rule affecting Ad America's property, or taken any formal
steps to commence eminent domain proceedings against Ad America's
property. In its writ petition, NDOT requests that we order the district
court to grant summary judgment and dismissal in NDOT's favor.
DISCUSSION
Writ consideration
A writ of mandamus is available "to control an arbitrary or
capricious exercise of discretion." Int'l Game Tech., Inc. v. Second Judicial
Dist. Court, 124 Nev. 193, 197, 179 P.3d 556, 558 (2008). Generally, writ
relief is available only when there is no "plain, speedy, and adequate
remedy in the ordinary course of law." NRS 34.170; Westpark Owners'
Ass'n v. Eighth Judicial Dist. Court, 123 Nev. 349, 356, 167 P.3d 421, 426
(2007). An appeal from a final judgment or order is usually an adequate
remedy, Ina Game Tech., 124 Nev. at 197, 179 P.3d at 558, and the court
often declines to exercise its discretion to consider writ petitions
challenging interlocutory district court orders. See Smith v. Eighth
Judicial Dist. Court, 113 Nev. 1343, 1344, 950 P.2d 280, 281 (1997). The
court has considered writ petitions, however, when "an important issue of
law needs clarification and considerations of sound judicial economy and
5We decline to address Ad America's precondemnation damages
claim because the district court has not decided the issue.
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administration militate in favor of granting the petition." Int'l Game
Tech., 124 Nev. at 197-98, 179 P.3d at 559.
We conclude that NDOT's writ petition merits our
consideration. First, the petition raises an important issue regarding
Nevada's takings law. Second, the petition presents an important
question of policy about an agency's ability to engage in efficient, long-
term planning dependent on federal funding. And third, given Project
Neon's magnitude as a 20- to 25-year, six-phase freeway improvement
project requiring multiple acquisitions of private property and the
inevitability of other similar long-term projects in the future, addressing
the issues raised in this petition will serve judicial economy. Accordingly,
we exercise our discretion to consider this writ petition. 6
We will only issue a writ of mandamus "to compel entry of a
summary judgment when [the evidence on file viewed in a light most
favorable to the nonmoving party shows] there is no genuine issue as to
any material fact and the movant is entitled to judgment as a matter of
law." Cnty. of Clark v. Bonanza No, 1, 96 Nev. 643, 650, 615 P.2d 939, 943
(1980); In re Irrevocable Trust Agreement of 1979, 130 Nev., Adv. Op. 63,
331 P.3d 881, 889 n.8 (2014). In making this determination, we consider
legal questions de novo. In re Irrevocable Trust Agreement of 1979, 130
Nev., Adv. Op. 63, 331 P.3d at 884-85.
6We summarily deny Ad America's request for a writ of prohibition
because it is not a proper vehicle to challenge the order at issue here.
Oxbow Constr., 130 Nev., Adv. Op. 86, 335 P.3d at 1238 n.4; see also NRS
34.320.
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In its petition, NDOT argues that there was no taking here
because there was no physical ouster, regulatory taking, or unlawful
exaction. NDOT also contends that it cannot be held liable for the City's
actions. According to NDOT, concluding that there has been a taking in
these circumstances is unjustifiably speculative given the contingencies of •
both federal funding and continued need for Ad America's property in
2028 when Phase 5 of Project Neon begins.
In response, Ad America contends that NDOT committed a
taking of its property." Specifically, Ad America asserts that there was a
de facto moratorium on development in Project Neon's path, Project Neon
had moved from the planning to acquisition stage, and Ad America
suffered substantial impacts. According to Ad America, it has been
rendered an involuntary and indentured trustee of its property due to the
effects of Project Neon.
Takings
Eight hundred years ago, the Magna Carta laid a foundation
for individual property rights, including the protection of private property
from unlawful government takings, which was incorporated into the U.S.
Constitution. 8 See Bridget C.E. Dooling, Take it Past the Limit:
7 AdAmerica frames its arguments in terms of a "de facto taking."
However, the U.S. Supreme Court has not explicitly defined "de facto
taking." Accordingly, to avoid confusion with other takings terminology,
we do not use this term.
sBecause Article 1, Section 8, Clause 6 of the Nevada Constitution
was partially derived from its counterpart in the U.S. Constitution, see
Official Report of the Debates and Proceedings in the Constitutional
Convention of the State of Nevada 60-63 (July 4, 1864) (Eastman 1866),
that clause, too, is connected to the Magna Carta.
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Regulatory Takings of Personal Property, 16 Fed. Cir. B.J. 445, 454-55
(2007); Andrew S. Gold, Regulatory Takings and Original Intent: The
Direct, Physical Takings Thesis "Goes Too Far," 49 Am, U. L. Rev. 181, 208
(1999). Specifically, the Takings Clause in the Fifth Amendment of the
U.S. Constitution provides that "private property [shall not] be taken for
public use, without just compensation." Similarly, the Nevada
Constitution provides that "[p]rivate property shall not be taken for public
use without just compensation having been first made, or secured, except
in cases of war, riot, fire, or great public peril, in which case compensation
shall be afterward made." Nev. Const. art. 1, § 8, cl. 6. Our state
constitution, however, also guarantees every individual's right to acquire,
possess, and protect property. Nev. Const. art. 1, § 1. As we previously
explained in McCarran International Airport v. Sisolak, 122 Nev. 645, 670,
137 P.3d 1110, 1127 (2006), "our State enjoys a rich history of protecting
private property owners against government takings," and "the Nevada
Constitution contemplates expansive property rights in the context of
takings claims."
Although our federal and state constitutions provide
significant protection of private property rights, these rights must be
considered in light of the realities facing state and local government
entities in their efforts to serve the public through long-term projects that
require significant planning and extensive compliance with both state and
federal law. Thus, these competing interests are balanced in takings
jurisprudence. See Koontz v. St. Johns River Water Mgmt. Dist., 570 U.S.
„ 133 S. Ct. 2586, 2594-95 (2013) (explaining that there is a need to
protect land-use permit applicants given their vulnerability in the face of
government discretion granting or denying their application and a need to
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protect the public from the burden of additional costs from the proposed
development); see also Penn Cent. Transp. Co. v. City of New York, 438
U.S. 104, 124 (1978) ("Government hardly could go on if to some extent
values incident to property could not be diminished without paying for
every such change in general law. . . ." (internal quotation omitted)).
Federal takings jurisprudence
Given "the nearly infinite variety of ways in which
government actions or regulations can affect property interests," no "magic
formula" exists in every case for determining whether particular
government interference constitutes a taking under the U.S. Constitution.
Arkansas Game & Fish Comm'n v. United States, 568 U.S. „ 133 S.
Ct. 511, 518 (2012). Nevertheless, there are several invariable rules
applicable to specific circumstances. Id. "[A] direct government
appropriation or physical invasion of private property," for example, is a
taking, as is a government regulation that authorizes a permanent
physical invasion of private property or "completely deprive[s] an owner of
all economically beneficial use of her property." Lingle v. Chevron U.S.A.,
Inc., 544 U.S. 528, 537-38 (2005) (internal quotation omitted). A taking
also occurs when a government entity requires an unlawful exaction in
exchange for approval of a land-use permit. See generally Koontz, 570 U.S.
, 133 S. Ct. 2586. Nearly all other takings claims "turn on situation-
specific factual inquiries." Arkansas Game, 568 U.S. at 133 S. Ct. at
518.
The parties agree that NDOT did not appropriate or physically
invade Ad America's property. No unlawful exaction was possible because
Ad America did not submit any land-use application. Moreover, the only
government regulation identified by the parties—the City's amendment to
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its General Plan—did not cause Ad America to suffer a permanent
physical invasion of its property and, as evidenced by Ad America's stream
of rental income and the continuing presence of commercial tenants, did
not completely deprive Ad America of "all economically beneficial use" of
its property. Accordingly, we are left to consider both regulatory and
nonregulatory factual inquiries to decide whether actions attributable to
NDOT amount to a taking.
Regulatory analysis (Penn Central analysis)
Generally, courts only consider ripe regulatory takings claims,
and "a claim that the application of government regulations effects a
taking of a property interest is not ripe until the government entity
charged with implementing the regulations has reached a final decision
regarding the application of the regulations to the property at issue."
Williamson Ctny. Reg'l Planning Comm'n v. Hamilton Bank of Johnson
City, 473 U.S. 172, 186 (1985); see also Hsu v. Cnty. of Clark, 123 Nev.
625, 635, 173 P.3d 724, 732 (2007) (indicating that an owner need not
exhaust her administrative remedies when a regulation authorizes a
permanent physical invasion of her property). But when exhausting
available remedies, including the filing of a land-use permit application, is
futile, a matter is deemed ripe for review. See Palazzolo v. Rhode Island,
533 U.S. 606, 625-26 (2001); see also State, Dep't of Taxation v. Scotsman
Mfg. Co., 109 Nev. 252, 255, 849 P.2d 317, 319 (1993) (acknowledging that
exhaustion of a taxpayer's administrative remedies is not required when
doing so would be futile).
Applying the general exhaustion rule, Ad America's regulatory
takings claim is unripe for review for a failure to file any land-use
application with the City. And although Ad America contends that
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exhaustion was futile because there was a de facto moratorium on
developing property within Project Neon's path, the record does not
support this contention. The opinion of Ad America's political consultant,
which was based on alleged statements from only one of seven City
Council members, is• insufficient to establish the existence of such a
moratorium. This is especially true given the context in which that
opinion was provided, where the City had approved 19 land-use
applications in proximity to Project Neon juxtaposed with having tabled a
single entity's 3 applications for special-use permits.
Even if we ignored the requirement of administrative
exhaustion, Ad America still could not establish that the City's
amendment to its General Plan constituted a regulatory taking. Three
factors guide ad hoc analyses of potential regulatory takings. See Penn
Cent., 438 U.S. at 124. These factors are (1) "the economic impact of the
regulation on the claimant," (2) "the extent to which the regulation has
interfered with distinct investment-backed expectations," and (3) "the
character of the governmental action." Id. Here, the record does not
support the proposition that the amendment had• an economic impact on
Ad America. Additionally, because the road-widening amendment had no
demonstrated nexus to Ad America's property, any impact on Ad
America's investment-backed expectations to develop its property would
be negligible. Finally, given the need to widen specific streets to ensure
adequate access to private property and construction areas during Project
Neon, the character of the government action is more akin to "adjusting
the benefits and burdens of economic life to promote the common good"
than to a physical invasion. Id. We therefore conclude that the
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regulation's impact on Ad America's property does not constitute a
regulatory taking.
Nevertheless, even assuming that these factors favored a
conclusion that Ad America's property was taken by the City's amendment
to its Master Plan, NDOT was not directly or vicariously liable for the
City's actions forming the basis of the hypothetical taking. There is no
compensable taking in such circumstances "unless the government's
actions on the intermediate third party have a direct and substantial
impact on the plaintiff asserting the takings claim." Tex. State Bank v.
United States, 423 F.3d 1370, 1377 (Fed. Cir. 2005) (internal quotation
omitted). And despite Ad America's efforts to portray NDOT as a grand
puppet master dictating the City's actions, the record does not support
such a portrayal. A City's decision to amend its Master Plan in a
coordinated effort to support both its residents' needs and the needs for a
construction project that will benefit its residents does not satisfy the
aforementioned legal standard. 9
Nonregulatory analysis
As Ad America's briefing intimates and Arkansas Game
acknowledges, see 568 U.S. at , 133 S. Ct. at 518, an ad hoc approach
outside of the regulatory takings context is possible. The U.S. Court of
Appeals for the Federal Circuit, for example, has recognized that even
where no government regulation is at issue, a taking occurs if the
government has "taken steps that directly and substantially interfere H
9 Based on the record, the City's unilateral decision to purchase a
parcel of land for the MLK Connector also cannot be attributed to NDOT.
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with [an] owner's property rights to the extent of rendering the property
unusable or valueless to the owner." Stueve Bros. Farms, LLC v. United
States, 737 F.3d 750, 759 (Fed. Cir. 2013). This standard, however, only
applies in extreme cases. Id. As an example of an extreme case, we
consider the facts of Richmond Elks Hall Association v. Richmond
Redevelopment Agency, 561 F.2d 1327 (9th Cir. 1977), wherein the Ninth
Circuit concluded that a nonregulatory taking had occurred.
The Richmond Elks Hall Association (Elks) owned property
that it leased to commercial tenants. Richmond Elks, 561 F.2d at 1329.
In 1959, the City of Richmond declared that a group of properties,
including Elks', was blighted, created the Richmond Development Agency
(Agency), and authorized Agency to exercise eminent domain. Id. By May
1966, the City approved Agency's plan for redevelopment of the blighted
area, which anticipated that Elks' property would be acquired within two
years. Id. By the end of 1966, Agency had begun acquiring blighted
properties. Id.
In early 1967, Elks received a letter from Agency stating that
Elks could only retain its property if it signed an agreement to rehabilitate
the property at its own expense, which Elks declined to do. Id. By May
1967, understanding that its property would soon be acquired, Elks
refused to offer tenancies in excess of month-to-month. Id. Moreover, as a
direct result of Agency's actions, Elks' commercial tenants suffered a
decrease in their gross sales, causing most of the tenants to leave the
property. Id. The exodus of tenants reduced Elks' rental income to less
than one-third of what it was before Agency adopted its plan. Id. at 1329-
30.
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19)
Later, in July 1968, Agency entered into an agreement with a
developer obligating Agency to acquire optioned property, including that
belonging to Elks, and then to convey it to the developer for construction of
a shopping center. Id. at 1330. The option, aside from being publicly
known, was extended from one year to two years. Id. By the end of 1969,
after Agency had acquired 83 percent of the blighted properties, excluding
Elks' property, federal funding was halted for the project. Id. Nearly
three years later, despite Agency's redevelopment efforts flooding Elks'
property on multiple occasions between 1970 and 1972 and its previous
actions, Agency informed Elks that it would not acquire its property. Id.
Based on these facts, the Ninth Circuit affirmed the lower court's
determination that Agency's actions rendered Elks' property "unsaleable
in the open market" and "severely limited" the property's use for its
intended purposes. Id. at 1330-31.
The circumstances in this case do not approach the extremity
of the facts in Richmond Elks. Unlike Richmond Elks, Ad America's
property is not anticipated to be needed for Project Neon until 2028, if at
all. At the date that Ad America alleges that a taking occurred, October
24, 2007, NDOT had not acquired a single parcel of property for Project
Neon, and did not for another three years. And, even then, it acquired
properties slotted for Phase 1 of the project, not Phase 5.
Also different from Richmond Elks, NDOT had not created a
contractual obligation or option with a private party guaranteeing future
rights to Ad America's property. Instead, the only meaningful action
NDOT had taken as of the alleged date of taking was continuing to
produce its environmental assessment as required by NEPA, which it did
not complete until 2009. Furthermore, based on the results of the
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environmental assessment, NEPA required additional compliance in the
form of an environmental impact statement, which NDOT did not
complete until the middle of 2010. Only at this point was it possible to
reasonably conclude that Ad America's property would likely be needed in
the future-18 years later. 1°
Even further, and in contrast to Richmond Elks, the loss of Ad
America's tenants was theoretically influenced by Ad America
highlighting NDOT's anticipated need of the property, as explained in Ad
America's owner's affidavit, magnifying the effect of any generalized
knowledge that the tenants might have had. Additionally, the reason
there was public knowledge of Project Neon's anticipated need for Ad
America's property was because NEPA required disclosure of the plans
and the opportunity for public comment." Making NDOT's compliance
with federal law a basis for compensation to Ad America in these
°Although every development alternative publicly disclosed upon
the completion of the environmental assessment required Ad America's
property, federal funding—the means of making Project Neon a reality—
hinged on the completion and acceptance of NDOT's environmental impact
statement.
"NEPA requires projects to be submitted as a whole and not
improperly segmented into subparts. See 40 CFR § 1502.4(a) ("Proposals
or parts of proposals which are related to each other closely enough to be,
in effect, a single course of action shall be evaluated in a single impact
statement"); Defenders of Wildlife v. N.C. Dep't of Transp., 762 F.3d 374,
394-95 (4th Cir. 2014); see also California ex rel. Imperial Cnty. Air
Pollution Control Dist. v. U.S. Dep't of the Interior, 767 F.3d 781, 795 (9th
Cir. 2014). Accordingly, NDOT could not have engaged in a piecemeal
environmental assessment or impact process to avoid publicly disclosing
the anticipated need for Ad America's property in the future.
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circumstances would undermine long-term public projects by requiring
comprehensive funding for all acquisitions at the planning stage, which
would, in turn, unreasonably expedite the need for acquired property to be
put to use. CI Nev. Const. art. 1, § 22, cl. 6 ("Property taken in eminent
domain shall automatically• revert back to the original property owner
upon repayment of the original purchase price, if the property is not used
within five years for the original purpose stated by the government.").
Finally, the record's minimal empirical evidence undermines
Ad America's position. The decrease in Ad America's rental income in
2011 did not approach the loss suffered by Elks, and certainly did not
"render[ I the property unusable or valueless" to Ad America. Stueve
Bros., 737 F.3d at 759. Additionally, Ad America provides no evidence of
fair market values or rental charges for similarly situated properties with
which to determine any real decrease in the fair market value or economic
use of the property. Thus, based on our nonregulatory analysis, we
conclude that NDOT did not take Ad America's property within the
meaning of the Fifth Amendment of the U.S. Constitution.
Nevada takings jurisprudence
Ad America insists that NDOT's actions constitute a taking
under the Nevada Constitution and that our case law supports this
conclusion. According to Ad America, in City of Sparks v. Armstrong, 103
Nev. 619, 748 P.2d 7 (1987), this court adopted an expanded takings
approach that provides for just compensation when precondemnation
activities are unreasonable or oppressive and diminish the market value of
property. We now clarify that our decision in Buzz Stew, LLC v. City of N.
Las Vegas, 124 Nev. 224, 181 P.3d 670 (2008), corrected Armstrong
inasmuch as Armstrong used our precondemnation damages standard to
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award just compensation for a taking based on precondemnation
activities.
The standard employed in Armstrong originated in our
decision, Sproul Homes of Nevada v. State, Department of Highways, 96
Nev. 441, 611 P.2d 620 (1980). In Sproul, the plaintiff-appellant's inverse
condemnation action for damages was dismissed for failure to state a
claim for relief. 96 Nev. at 442, 611 P.2d at 620. We explained that to
state an inverse condemnation action for damages, "there must be an
invasion or an appropriation of some valuable property right which the
landowner possesses and the invasion or appropriation must directly and
specially affect the landowner to his injury.'" Id. at 444, 611 P.2d at 621-
22 (quoting Selby Realty Co. v. City of San Buenaventura, 514 P.2d 111,
114-15 (Cal. 1973)). Acknowledging that "not every decrease in market
value as a result of precondemnation activities is compensable," the court
also stated that when such activities are "unreasonable or oppressive and
the affected property has diminished in market value as a result of the
governmental misconduct, the owner of the property may be entitled to
compensation." Id. at 444-45, 611 P.2d at 622 (citing Klopping v. City of
Whittier, 500 P.2d 1345, 1355 (Cal. 1972)). Thus, Sproul discussed•
unreasonable or oppressive activities that diminished market value in the
context of precondemnation damages only. Id.
Sproul clarified that the standards it announced and relied on
were for claims of damages related to unreasonable and oppressive
precondemnation activities (now called precondemnation damages), and
not for just compensation for the fair market value of a property due to a
taking. Id. at 442-45, 611 P.2d at 620-22. That Sproul, and necessarily
Armstrong, employed our standard for precondemnation damages is
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confirmed not only by the California cases upon which they relied, namely
Klopping and Selby, but also by our later decisions relying on this
standard and citing to Sproul. See Buzz Stew, 124 Nev. at 231 n.17, 181
P.3d at 674 n.17.; State, Dep't of Transp. v. Barsy, 113 Nev. 712, 720-21,
941 P.2d 971, 976 (1997), overruled on other grounds by GES, Inc. v.
Corbitt, 117 Nev. 265, 21 P.3d 11 (2001). We therefore will not apply this
standard to Ad America's takings claim and conclude that NDOT did not
commit a taking under the Nevada Constitution. 12
CONCLUSION
Based on our analysis, we conclude that the undisputed
material facts, as a matter of law, do not demonstrate that NDOT
committed a taking of Ad America's property warranting just
compensation. Therefore, we grant NDOT's writ petition. Summary
judgment in favor of NDOT is warranted, but summary judgment in favor
of Ad America is not. The clerk of this court shall issue a writ of
mandamus instructing the district court to vacate its previous order and
12 Given our conclusion that a taking did not occur, we do not address
the parties' arguments concerning the valuation date for the taking.
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enter a new order granting summary judgment in favor of NDOT on the
inverse condemnation cause of action. 13
J.
Douglas
We concur:
LA-4.3t1 , C.J.
Hardesty
CIAA
J.
Parraguirre
J.
Saitta
J.
13 We
limit our holding to apply through December 14, 2012, the last
date at which the district court heard arguments and considered evidence
from the parties.
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GIBBONS, J., concurring:
While I concur with the majority that NDOT was not directly
or vicariously liable for the actions of the City of Las Vegas, this writ• of
mandamus only adjudicates the summary judgment motions of NDOT and
Ad America. Any claims Ad America may have against the City of Las
Vegas or any other third parties, together with any claims against NDOT
which matured after December 14, 2012,remain outstanding.
Gibbons
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