CB Windswept

IN THE COURT OF APPEALS OF NORTH CAROLINA

No. COA15-371 and 15-374

Filed: 20 October 2015

New Hanover County, No. 12 CVS 4482 and 13 CVS 1254

POINT SOUTH PROPERTIES, LLC, and SANCO BUILDERS CORPORATION,
Plaintiffs,

v.

CAPE FEAR PUBLIC UTILITY AUTHORITY and NEW HANOVER COUNTY,
Defendants.

and

CB WINDSWEPT, LLC, SELLAR’S COVE, LLC, TELFAIR SUMMIT, LLC, and CB
SNOWS CUT LANDING, LLC, Plaintiffs,

v.

CAPE FEAR PUBLIC UTILITY AUTHORITY and NEW HANOVER COUNTY,
Defendants.

Appeal by defendants from orders entered 23 September 2014 by Judge W.

Douglas Parsons in New Hanover County Superior Court. Heard in the Court of

Appeals 23 September 2015.

Shipman & Wright, LLP, by William G. Wright and Gary K. Shipman for
plaintiffs-appellees.

Ward and Smith, P.A., by Jeremy M. Wilson and Ryal W. Tayloe for defendants-
appellants.

ZACHARY, Judge.
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Opinion of the Court

In Court of Appeals Case COA 15-371, Cape Fear Public Utility Authority

(CFPUA) and New Hanover County (collectively referred to as defendants) appeal

from an order granting summary judgment in favor of Point South Properties, LLC

and Sanco Builders Corporation (Point South plaintiffs), on plaintiffs’ claims arising

from the payment of impact fees assessed by defendants. Similarly, in Court of

Appeals Case COA 15-374, the same defendants appeal from summary judgment

entered in favor of CB Windswept, LLC; Sellar's Cove, LLC; Telfair Summit, LLC;

and CB Snows Cut Landing, LLC (Windswept plaintiffs), on claims arising from

plaintiffs’ payment of impact fees. Pursuant to the provisions of N.C.R. App. P. 40,

the cases were consolidated for oral argument by this Court. Moreover, in that “both

appeals involve common questions of law, as evidenced by defendants’ decision to

submit virtually identical appellate briefs in each case,” the Court has consolidated

“these appeals for the purpose of rendering a single opinion on all issues properly

before the Court.” Putman v. Alexander, 194 N.C. App. 578, 580, 670 S.E.2d 610, 613

(2009).

On appeal defendants argue that plaintiffs’ claims were barred by the statute

of limitations and the doctrine of laches, that defendants were entitled to charge

water and sewer impact fees to plaintiffs, and that plaintiffs’ constitutional claims

lack merit. We conclude that plaintiffs’ claims were not barred by the statute of

limitations or the doctrine of laches, that the trial court properly entered summary

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judgment for plaintiffs on their claim that defendants’ imposition of impact fees was

ultra vires, and that it is not necessary to reach the merits of plaintiffs’ constitutional

claims.

I. Factual and Procedural Background

In 1983 New Hanover County created the New Hanover County Water and

Sewer District (NHCWSD), which provided water and sewer service in the

unincorporated areas of the county. In 1987 NHCWSD established an impact fee

policy, pursuant to the terms of which the payment of a water and sewer impact fee

was a precondition for a developer to receive a building permit. The rationale for this

policy was that “the Water and Sewer District was working to expand out its

infrastructure with the goal of providing water and sewer services to everybody

throughout the county.” In 2007 New Hanover County and the City of Wilmington

entered into an interlocal agreement and created CFPUA, a water and sewer

authority. Pursuant to the agreement creating CFPUA, all assets and liabilities of

NHCWSD were transferred to CFPUA. In 2008 CFPUA replaced the previous

ordinances of NHCWSD and of the City of Wilmington with a single CFPUA

ordinance that did not assess impact fees for developments prior to the time that

service was provided.

Plaintiffs are companies engaged in residential development in southern New

Hanover County. Between 2003 and 2006, plaintiffs developed certain properties in

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New Hanover County (the subject properties). In order to obtain the necessary

building permits, plaintiffs were required to pay NHCWSD impact fees associated

with the provision of water and sewer service. The fees totaled approximately

$238,000 paid by the Point South plaintiffs, and approximately $220,000 paid by the

Windswept plaintiffs.

Aqua North Carolina, Inc., (Aqua) is a private utility company providing water

and sewer service in various locations throughout North Carolina. At all times since

their construction, Aqua has provided water and sewer service for the subject

properties. When plaintiffs were first assessed impact fees, they informed defendants

that water and sewer service was provided by Aqua and argued that they should not

have to pay the fees because plaintiffs’ properties were already served by Aqua and

therefore the subject properties would not have any impact on the water or sewer

facilities operated by NHCWSD. Defendants would not capitulate and ultimately

plaintiffs paid the required fees in order to obtain building permits.

As early as 1976, defendants identified the unincorporated areas in the

southern part of New Hanover County as a potential location for expansion of water

and sewer service. Accordingly, defendants have included this area, which includes

the subject properties, in their long range estimates of possible future demand for

water and sewer service. It is undisputed, however, that defendants have never made

an official decision to extend water and sewer service to any of the subject properties

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or taken any steps towards extending water and sewer service in these specific

developments.

On 21 November 2012 the Point South plaintiffs filed suit against defendants,

seeking the refund of the impact fees plaintiffs had paid, together with interest and

attorney’s fees. The Point South plaintiffs alleged that defendants’ actions in

assessing impact fees were ultra vires and violated plaintiffs’ rights to due process

and equal protection under the United States and North Carolina Constitutions. On

27 December 2012, defendants filed an answer and a motion to remove the Point

South plaintiffs’ action to the United States District Court for the Eastern District of

North Carolina, on the basis of the Point South plaintiffs’ inclusion in their complaint

of claims arising under the U.S. Constitution. The parties each filed an amended

complaint and answer in federal court. Thereafter, the Point South plaintiffs

dismissed their federal constitutional claims and moved for remand to state court.

On 26 March 2013 the case was remanded to the Superior Court of New Hanover

County. On 5 November 2013 the Point South plaintiffs filed their second amended

complaint. On 3 January 2014 defendants filed their answer, raising various

defenses, including allegations that the Point South plaintiffs’ claims were barred by

the applicable statute of limitations and the doctrine of laches, and that the impact

fees were authorized by statute. The Point South plaintiffs and defendants moved

for summary judgment on 21 August 2014 and 27 August 2014, respectively.

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On 27 March 2013 the Windswept plaintiffs filed a complaint seeking damages

arising from their payment of impact fees, including refund of the payments with

interest and attorneys’ fees. The Windswept plaintiffs’ complaint similarly alleged

that defendants’ imposition of impact fees was ultra vires and violated plaintiffs’

rights to due process and equal protection under the North Carolina Constitution. As

the Windswept plaintiffs did not assert any claims arising under the federal

constitution, the issue of removal to federal court did not arise in connection with

their lawsuit. On 5 February 2014 Judge William G. Wright granted the Windswept

plaintiffs’ motion to amend their complaint. On the same date, the Windswept

plaintiffs filed an amended class action complaint on behalf of themselves and others

similarly situated. On 6 March 2014 defendants filed an answer denying the material

allegations of the Windswept plaintiffs’ complaint and asserting various defenses,

including the statute of limitations and the doctrine of laches. The Windswept

plaintiffs filed a motion for class action certification on 28 March 2014, which was

denied by Judge W. Allen Cobb, Jr., on 18 July 2014. The Windswept plaintiffs filed

a motion for summary judgment on 21 August 2014 and defendants filed a motion for

summary judgment on 27 August 2014.

As discussed above, the procedural histories of the claims filed by the Point

South plaintiffs and the Windswept plaintiffs are slightly different, given that the

Point South plaintiffs initially brought claims under the federal constitution and the

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Windswept plaintiffs initially sought class certification. Nevertheless, because the

Point South plaintiffs voluntarily dismissed their federal claims, and the Windswept

plaintiffs did not appeal the denial of their motion for class certification, the parties’

summary judgment motions raised the same issues in both cases. Accordingly, on 4

September 2014 the trial court conducted a single hearing on the summary judgment

motions of the parties in both cases, at which all plaintiffs were represented by the

same law firm. On 23 September 2014 the trial court entered identical orders in both

cases granting summary judgment for the plaintiffs in each case. Defendants timely

entered notices of appeal from both summary judgment orders. As defendants have

raised the same appellate issues in both cases and the plaintiffs have presented the

same defenses, in the remainder of this opinion the term “plaintiffs” shall refer to

both the Point South plaintiffs and the Windswept plaintiffs.

II. Standard of Review

The standard of review of a trial court’s summary judgment order is well-

established. Under N.C. Gen. Stat. § 1A-1, Rule 56(c), summary judgment is properly

entered “if the pleadings, depositions, answers to interrogatories, and admissions on

file, together with the affidavits, if any, show that there is no genuine issue as to any

material fact and that any party is entitled to a judgment as a matter of law.” “ ‘ In

a motion for summary judgment, the evidence presented to the trial court must be

admissible at trial, N.C.G.S. § 1A-1, Rule 56(e) [(2013)], and must be viewed in a light

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most favorable to the non-moving party.’ ” Patmore v. Town of Chapel Hill, N.C., __

N.C. App. __ , __ , 757 S.E.2d 302, 304 (quoting Howerton v. Arai Helmet, Ltd., 358

N.C. 440, 467, 597 S.E.2d 674, 692 (2004) (internal citation omitted)), disc. review

denied, 367 N.C. 519, 758 S.E.2d 874 (2014). “If the trial court grants summary

judgment, the decision should be affirmed on appeal if there is any ground to support

the decision.” Nifong v. C.C. Mangum, Inc., 121 N.C. App. 767, 768, 468 S.E.2d 463,

465 (1996) (citing Shore v. Brown, 324 N.C. 427, 428, 378 S.E.2d 778, 779 (1989)).

“We review trial court orders granting or denying a summary judgment motion

utilizing a de novo standard of review.” Davis v. Woodlake Partners, LLC, __ N.C.

App. __, __, 748 S.E.2d 762, 766 (2013) (citing In re Will of Jones, 362 N.C. 569, 573,

669 S.E.2d 572, 576 (2008)).

III. Statute of Limitations

Defendants argue initially that plaintiffs’ claims are barred by the applicable

statute of limitations. We disagree.

We first clarify the nature of the parties’ dispute as it relates to the statute of

limitations. Defendants assert that plaintiffs’ claims are based on N.C. Gen. Stat. §

162A-88, which grants defendants the authority to levy fees for water and sewer

“services furnished or to be furnished.” Based on their contention that plaintiffs’

claims arise from this statute, defendants assert that plaintiffs’ claims were subject

to the three year statute of limitations set out in N.C. Gen. Stat. § 1-52(2) for claims

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Opinion of the Court

based upon a “liability created by statute.” We conclude, however, that defendants’

position is based upon a misapprehension both of plaintiffs’ complaint and of the

provisions of N.C. Gen. Stat. § 162A-88.

Defendants contend that the parties have no disagreement over defendants’

authority to impose the impact fees at issue and that plaintiffs “simply allege that

the manner in which Defendants have exercised this statutory authority has resulted

in liability.” In addition, defendants maintain that plaintiffs have claimed that

defendants “acted improperly under these statutes by not actually providing sewer

service to the Properties.” Defendants do not cite a basis in the record evidence for

this contention. Our own review of plaintiffs’ complaint reveals that plaintiffs assert

that defendants lacked the authority to impose impact fees under N.C. Gen. Stat. §

162A-88, and that in their complaint plaintiffs do not ask defendants to provide water

or sewer service, or complain of defendants’ failure to provide service. Moreover, at

the hearing on the parties’ summary judgment motions, plaintiffs’ counsel stated

that:

[Defense counsel] says that we are alleging that there is
some implied obligation to provide services within a
designated period of time. Hear me again loud and clear,
we’re not alleging that at all. We’re alleging that they
levied these fees without authority, period. We don’t want
them to provide service. We don’t need them to provide
service. So, we’re not alleging that there’s some obligation
to provide service, we’re saying they had no authority to
extract the fees.

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We conclude that plaintiffs neither conceded defendants’ authority to levy the impact

fees at issue nor based their claims on defendants’ failure to provide water and sewer

service for the subject properties, and that plaintiffs do not contend that defendants

breached a duty owed under N.C. Gen. Stat. § 162A-88. Instead, it is defendants who

raise the statute as a defense to plaintiffs’ claims, by arguing that the impact fees

were authorized under N.C. Gen. Stat. § 162A-88.

In support of their position that the three year statute of limitations in N.C.

Gen. Stat. § 1-52(2) applies to the instant case, defendants cite several cases in which

the plaintiff sought to recover damages based on a statute that established the

defendant’s alleged liability. For example, defendants cite Wilson v. McLeod Oil Co.,

327 N.C. 491, 506, 398 S.E.2d 586, 593 (1990), rehearing denied, 328 N.C. 336, 402

S.E.2d 844 (1991), in which the plaintiffs sought damages under N.C. Gen. Stat. §

143-215.93, which provides in part that “[a]ny person having control over oil or other

hazardous substances which enters the waters of the State . . . shall be strictly liable,

without regard to fault, for damages to persons or property, public or private, caused

by such entry[.]” In Wilson, our Supreme Court held that the plaintiffs’ “statutory

claim based on N.C.G.S. § 143-215.93 is barred by the statute of limitations found in

N.C.G.S. § 1-52(2)[.]” Defendants contend that because plaintiffs’ claims are based

on N.C. Gen. Stat. § 162A-88, plaintiffs are therefore seeking recompense based on a

“liability created by statute.” Although N.C. Gen. Stat. § 162A-88 grants defendants

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the authority to levy fees for water and sewer “services furnished or to be furnished,”

the statute does not impose any duty on defendants, or expose them to liability.

Accordingly, the cases cited by defendants are clearly distinguishable from the

instant case.

We conclude that plaintiffs’ claims are not based upon defendants’ alleged

breach of a duty or liability established by N.C. Gen. Stat. § 162A-88, and that the

statute itself does not expose defendants to liability. Therefore, we hold that

plaintiffs’ claims are not subject to the three year statute of limitations for a claim

based on a liability created by statute.

Defendants also assert, in the alternative, that plaintiffs’ claims are barred by

the two year statute of limitations set out in N.C. Gen. Stat. § 1-53(1) for an “action

against a local unit of government upon a contract, obligation or liability arising out

of a contract, express or implied.” Defendants allege that plaintiffs are seeking

damages based on an “implied” contract, and assert that “[p]laintiffs apparently

attempt to argue that NHCWSD was obligated to immediately provide them with

sewer services.” Defendants do not cite to any allegations of plaintiffs’ complaint for

their position, and we conclude that plaintiffs do not maintain that defendants were

obligated to provide them with water and sewer service either “immediately” or

within some other time limit, but that defendants lacked authority to impose the

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impact fees at issue. Defendants’ argument that plaintiffs’ claims are subject to the

two year statute of limitations for an action arising under a contract is without merit.

Plaintiffs contend that the ten year statute of limitations set out in N.C. Gen.

Stat. § 1-56 applies to their claims. N.C. Gen. Stat. § 1-56 provides that “[a]n action

for relief not otherwise limited by this subchapter may not be commenced more than

10 years after the cause of action has accrued.” Plaintiffs argue that, because no other

statute establishes the statute of limitations for their claim, the residual or “catch

all” period of ten years set out in N.C. Gen. Stat. § 1-56 applies. We agree.

Plaintiffs cite Amward Homes, Inc. v. Town of Cary, 206 N.C. App. 38, 698

S.E.2d 404 (2010), which applied the ten year statute of limitations in N.C. Gen. Stat.

§ 1-56 to the plaintiffs’ claim for damages arising from payments of allegedly ultra

vires impact fees, with Judge Jackson dissenting on the basis that plaintiffs’ appeal

was interlocutory. Upon appeal of Amward Homes to our Supreme Court, during

which time Justice Jackson was seated on the Supreme Court and did not take part

in the consideration of this case, in Amward Homes, Inc. v. Town of Cary, 365 N.C.

305, 716 S.E.2d 849 (2011), the Supreme Court stated that the remaining members

of the Court were equally divided and that “[a]ccordingly, the decision of the Court of

Appeals is left undisturbed and stands without precedential value.” Amward, 365

N.C. at 306, 716 S.E.2d at 850. As a result, this Court’s holding in Amward does not

constitute binding precedent.

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Plaintiffs also direct our attention to Tommy Davis Constr., Inc. v. Cape Fear

Pub. Utility Authority, 2014 U.S. Dist. LEXIS 92449 (E.D.N.C. July 7, 2014), in which

the federal district court for the Eastern District of North Carolina granted summary

judgment in favor of the plaintiff. In Tommy Davis, which is very similar to the case

at hand, the plaintiff real estate developer sued the current defendants for damages

based on plaintiff’s payment of impact fees. In the opinion, which discusses the same

issues raised in the present appeal, the court held that the statute of limitations for

the plaintiff’s claims was ten years. Although neither Amward nor Tommy Davis

constitutes binding precedent, we agree with the holdings of these cases that the

proper statute of limitations is ten years. It is undisputed in the case at bar that

plaintiffs filed suit within ten years of their payment of the challenged impact fees,

and we conclude that plaintiffs’ claims are not barred by the statute of limitations.

IV. Laches

Defendants also argue that plaintiffs’ claims are barred by the doctrine of

laches. “We [have] previously held, ‘laches is an equitable defense and is not available

in an action at law.’ When a ‘[p]laintiff’s claims are legal in nature, not equitable[,]’

laches cannot support judgment for the defendant.” Cater v. Barker, 172 N.C. App.

441, 448, 617 S.E.2d 113, 118 (2005) (quoting City-Wide Asphalt Paving, Inc. v.

Alamance County, 132 N.C. App. 533, 537, 513 S.E.2d 335, 338, disc. rev. denied and

appeal dismissed, 350 N.C. 826, 537 S.E.2d 815 (1999) (internal citations omitted)),

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aff'd, 360 N.C. 357, 625 S.E.2d 778 (2006). In the cases cited by defendants, the

plaintiffs sought injunctive or other equitable relief, while in this case plaintiffs’

claims are legal rather than equitable. Therefore, the doctrine of laches is not

applicable to this case.

Moreover, defendants have failed to produce evidence that they were

prejudiced by plaintiffs’ delay in bringing suit. Defendants assert that they invested

the impact fees “into expansion of wastewater service capacity in order to, in part,

eventually provide services to communities in southern New Hanover County.” It is

undisputed, however, that defendants’ proposed expansion of wastewater service

capacity remains at the planning stage, and that expansion is required without

regard to whether or not the subject properties are ever serviced by defendants.

Defendants contend that their calculation of projected needs included reference to the

subject properties, but have failed to articulate any prejudice arising from inclusion

in planning documents of a figure representing the subject properties. Defendants

do not contend that they undertook any expenditures that would not have been

otherwise necessary, or that their legal position has been negatively impacted by the

passage of time. We conclude that plaintiffs’ claims are not barred by the doctrine of

laches.

V. Authority to Impose Impact Fees

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Defendants argue that the trial court erred by granting summary judgment for

plaintiffs, on the grounds that defendants’ imposition of impact fees was authorized

by N.C. Gen. Stat. § 162A-88, which provides in relevant part that:

The inhabitants of a county water and sewer district
created pursuant to this Article are a body corporate and
politic . . . [and] may establish, revise and collect rates, fees
or other charges and penalties for the use of or [for] the
services furnished or to be furnished by any sanitary sewer
system, water system or sanitary sewer and water system
of the district[.] . . .

Defendants contend that the impact fees were for services “to be furnished.” We

disagree, and conclude that plaintiffs produced uncontradicted evidence establishing

that defendants could not present a prima facie case that defendants have ever

decided or planned for water and sewer service “to be furnished” to the subject

properties. Defendants have not responded to plaintiffs’ evidence with any evidence

demonstrating a genuine issue of material fact, making entry of summary judgment

for plaintiffs proper in this case.

As a preliminary matter, we again spell out the nature of the parties’ dispute,

this time as it relates to defendants’ authority to assess the impact fees at issue. At

the hearing on this matter and in their appellate brief, defendants characterize their

dispute with plaintiffs as an issue of whether defendants have been sufficiently

prompt in arranging to extend water and sewer service to the subject properties. For

example, defendants state in their appellate brief that “Plaintiffs contend that

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NHCWSD's actions were ultra vires because NHCWSD charged impact fees for

properties that would not immediately be connected to its wastewater system.”

Plaintiffs’ complaint, however, does not fault defendants for failing to “immediately”

extend water and sewer service to the subject properties, or allege that it is the

timeline of defendants’ actions that renders the impact fees ultra vires. Rather,

plaintiffs assert in their complaint that imposition of the impact fees was “beyond the

statutory authority of the Defendants and any of their predecessors in interest,” and

assert in their appellate brief that the “Impact Fees were ultra vires as the fees

assessed to Plaintiffs were neither for services that were furnished nor to be

furnished.” We conclude that the issue before us is not, as defendants have urged,

whether defendants were required to “immediately” extend water and sewer service

to plaintiffs after assessment of impact fees. Rather, we must decide whether there

is evidence from which it might reasonably be found that defendants have ever

evidenced a commitment to extending water and sewer service to the subject

properties, regardless of the timeline.

The record demonstrates that defendants previously have stated their

intention to extend service to specific locations and have set out a target timeline for

doing so. For example, the 9 June 2010 CFPUA minutes includes the following:

Mr. Fletchner provided an overview of [CFPUA’s]
anticipated CIP [Capital Improvement Program] through

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FY [Fiscal Year] 2018. Water CIP was summarized as
follows:

In Fiscal Year 2011, Porters Neck customers will be added
and plans for the extension of a water line down 23rd Street
to Castle Hayne Road will begin.

In Fiscal Year 2012, extensions are planned for Bald Eagle
Lane, and bulk sales should be underway with Pender
County and Figure 8 Island. The distribution system along
Kerr Avenue will be continued. FY2012 includes plans to
extend water service down Carolina Beach Road to the
South. . . .

In Fiscal Year 2013, . . . [the] Authority plans to expand
into the Middle Sound area[.] . . . Extensions will continue
in the Southern part of the County and along River Road.

In Fiscal Year 2014, the Sweeny plant expansion will be
completed . . . [and the] Authority plans to extend service
into the Bayshore area.

No new growth is anticipated for Fiscal Years 2015 and
2016. In Fiscal Year 2017, additional growth is expected
in the Porters Neck area and along Castle Hayne road. In
Fiscal Year 2018, the Authority expects to continue
building the system in the Northern part of the County.

The wastewater CIP was summarized as follows:

In Fiscal Year 2011 . . .[through] 2013, the Authority will
address pump station upgrades[.] . . .

In Fiscal Year 2014, the Authority expects to work closely
with the New Hanover County Health Department to
address failing septic systems in the Southern part of the
County. No new expansion is anticipated for Fiscal Years
2015 and 2016.

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In Fiscal Year 2017, . . . [the Authority will] continue to
increase pump station capacity.

In Fiscal Year 2018, the Authority expects to extend
wastewater services in the Heritage Park, Wrightsboro and
Prince George Estates areas.

Defendants do not allege that their capital improvement plan includes any specific

commitment to extend water and sewer service to any of the developments that

comprise the subject properties. Given that these plans extend through Fiscal Year

2018, it appears that the CFPUA has no plans in the foreseeable future to extend

service to the subject properties.

Moreover, at all times since their construction, water and sewer service for the

subject properties has been provided by Aqua, and the defendants do not have the

authority to condemn Aqua’s property. N.C. Gen. Stat. § 40A-5, entitled

“Condemnation of property owned by other condemnors,” provides that a public

condemnor, as defined in N.C. Gen. Stat. § 40A-3, “may condemn the property of a

private condemnor if such property is not in actual public use or not necessary to the

operation of the business of the owner.” N.C. Gen. Stat. § 40A-5(b). Under N.C. Gen.

Stat. § 40A-42(c), if a public condemnor such as CFPUA attempts to condemn

property [that] is owned by a private condemnor, the
vesting of title in the condemnor and the right to
immediate possession of the property shall not become
effective until the superior court has rendered final
judgment (after any appeals) that the property is not in
actual public use or is not necessary to the operation of the
business of the owner, as set forth in G.S. 40A-5(b).

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In this case, it is undisputed that Aqua has continuously provided water and sewer

service and, as a result, that the property owned by Aqua is both in actual use and

“necessary to the operation of the business of the owner.” Therefore, defendants do

not have the authority to exercise the right of eminent domain in order to condemn

Aqua’s property for their own use. In addition, the uncontroverted affidavit of

Thomas J. Roberts, the president and Chief Operating Officer of Aqua, avers in

relevant part that, as regards the Point South plaintiffs:

4. In 2005, Aqua North Carolina, Inc. was granted a
Certificate of Public Convenience and Necessity for several
subdivisions in southern New Hanover County, including
Willow Glen at Beau Rivage subdivision and Point South
Apartment complexes.

...

6. Aqua North Carolina, Inc. has entered into sewer and
water agreements with the developers of Willow Glen at
Beau Rivage subdivision and Point South Apartment
complexes and provides sewer and water service to the
subdivision and apartment complexes.

7. To the best of my knowledge and belief no other entity,
including the New Hanover County Water & Sewer
District or the Cape Fear Public Utility Authority
furnished any water or sewer services to Willow Glen at
Beau Rivage subdivision and Point South Apartment
complexes since their creation and construction.

8. To the best of my knowledge and belief no other entity,
including the New Hanover County Water & Sewer
District or the Cape Fear Public Utility Authority currently
furnishes any water or sewer services to Willow Glen at

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Beau Rivage subdivision and Point South Apartment
complexes.

9. Aqua North Carolina, Inc.’s intent and plan is to
continue to provide water and sewer services to Willow
Glen at Beau Rivage subdivision and Point South
Apartment complexes and other subdivisions in southern
New Hanover County, north of Snow's Cut in accordance
with the terms and provisions of its tariff. Aqua North
Carolina, Inc. has no current intent or plans to abandon or
sell those services and infrastructure and would not
anticipate taking any such action for the foreseeable
future.

10. I have informed the Cape Fear Public Utility Authority
of Aqua North Carolina, Inc.’s intent and plan as stated
above.

11. Aqua North Carolina, Inc. has never been presented
with any offer from the Cape Fear Public Utility Authority
to purchase Aqua North Carolina, Inc.’s services or
infrastructure in southern New Hanover County.

Mr. Roberts also executed an affidavit in regards to the Windswept plaintiffs, which

was essentially identical except for the names of the relevant subdivisions. Thus, the

uncontradicted record evidence establishes that Aqua has always provided water and

sewer service to the subject properties, intends to continue providing water and sewer

service, and that defendants have never contacted Aqua about purchasing the right

to extend service to the subject properties.

To summarize, the uncontradicted record evidence shows that at the time that

defendants required plaintiffs to pay impact fees and at all times since then, the

following circumstances have existed:

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1. Since 1976 defendants have represented that they have
a generalized long range plan to expand water and sewer
service to the southern part of New Hanover County, where
the subject properties are located.

2. Although defendants have stated their intention to
extend water and sewer service to other specific locations
within a projected timeframe, defendants have never
expressed any decision or official commitment to expand
service to any of the subject properties.

3. At all times, the water and sewer service for the subject
properties have been provided by Aqua, and defendants
have never announced an official decision to take concrete
steps towards replacing Aqua as the water and sewer
service provider for these properties.

5. Defendants have not contacted Aqua about purchasing
Aqua’s infrastructure or entered into negotiations or
communications with Aqua about this possibility.

6. Defendants have never stated a timeline, or even an
aspirational target year, for provision of service to any of
the subject properties.

We conclude that there is no evidence in the record that defendants have ever

planned for water and sewer service “to be furnished” to the subject properties. We

hold that under these factual circumstances defendants have failed to show any

evidentiary basis for their contention that the fees were for service “to be furnished.”

If we were to accept defendants’ contention that the documents indicating a

generalized goal of extending water and sewer service to unspecified parts of New

Hanover County at an unspecified time in the indefinite future are sufficient to

authorize imposition of impact fees for services “to be furnished,” then fees could be

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imposed whenever a water and sewer board expressed even the vaguest intention to

possibly extend service at some unspecified time in the future. This would be an

absurd result, and it is well established that:

“The Court will not adopt an interpretation which resulted
in injustice when the statute may reasonably be otherwise
consistently construed with the intent of the act.
Obviously, the Court will, whenever possible, interpret a
statute so as to avoid absurd consequences.”

Sutton v. Aetna Casualty & Surety Co., 325 N.C. 259, 265, 382 S.E.2d 759, 763 (1989)

(quoting Insurance Co. v. Chantos, 293 N.C. 431, 440, 238 S.E.2d 597, 603 (1977)).

This Court’s holding that defendants have failed to show that impact fees were

assessed for water and sewer service “to be furnished” is based solely upon the specific

facts of this case, in which defendants produced no evidence that they had ever made

a decision to furnish water and sewer service to the subject properties, and had taken

no steps towards extending service to these locations. Accordingly, this Court

expressly declines to state any criteria, guidelines, or standards for determination of

whether the evidence in a particular case is adequate to support assessment of impact

fees for services “to be furnished.”

Moreover, it is noted that in McNeill v. Harnett County, 327 N.C. 552, 570, 398

S.E.2d 475, 485 (1990), our Supreme Court held “that the provisions of N.C.G.S. §

162A-88 authorizing user fees for services ‘to be furnished’ [are] not limited to the

financing of maintenance and improvements of existing customers.” In McNeill,

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however, there was no question that sewer service would be provided to the plaintiffs.

On the facts of this case, we agree with the analysis in Tommy Davis, which

distinguished McNeill and stated that:

[D]efendants in the instant matter have been developing
“plans” to provide water and sewer services to the southern
portion of New Hanover County, which includes [the
subject properties], since 1976. As plaintiff points out,
these plans are at best vague, and some plans even indicate
that water and sewer services will not need to be provided
by the government because service is already available
through Aqua NC. Defendants have not taken concrete
steps to actually provide water and sewer services to [the
subject properties]. As of the time of filing the instant
motions, Aqua NC continued to provide services to [the
properties], eight years after plaintiff paid the impact fees,
and Aqua NC intends to continue to provide those services.
Aqua NC is unaware of any plan by any other entity,
including defendants, to ever provide water and sewer
services to [the subject properties] or any other areas in
southern New Hanover County that are serviced by Aqua
NC. Because no clear steps have been taken over the past
decade since [the properties were] first permitted for
defendants to provide water and sewer services, the
assessment of impact fees was not a reasonable exercise of
defendants' powers, but an ultra vires act beyond their
statutory authority.

Tommy Davis, 2014 U.S. Dist. LEXIS 92449 at *9. We conclude that plaintiffs

produced evidence showing that defendants could not make a prima facie case that

the impact fees were properly imposed for water and sewer service “to be furnished,”

and that defendants failed to produce evidence to rebut plaintiffs’ showing. As a

result, the trial court did not err by granting summary judgment in favor of plaintiffs.

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In reaching this conclusion, we have rejected defendants’ arguments urging us

to reach a contrary result. Defendants direct our attention to N.C. Gen. Stat. § 153A-

4, which states that:

It is the policy of the General Assembly that the counties
of this State should have adequate authority to exercise the
powers, rights, duties, functions, privileges, and
immunities conferred upon them by law. To this end, the
provisions of this Chapter and of local acts shall be broadly
construed and grants of power shall be construed to include
any powers that are reasonably expedient to the exercise of
the power.

Nonetheless, “[w]hen the language of a statute is clear and unambiguous, there is no

room for judicial construction, and the courts must give it its plain and definite

meaning.” Lemons v. Old Hickory Council, 322 N.C. 271, 276, 367 S.E.2d 655, 658

(1988) (citations omitted). The language of N.C. Gen. Stat. § 162A-88 is clear and

unambiguous:

Section 153A-4 does state that any legislative act affecting
counties should be “broadly construed and grants of power
shall be construed to include any powers that are
reasonably expedient to the exercise of the power.” N.C.
Gen. Stat. § 153A-4 [(2013)]. . . . But, in conjunction with
our general rules of statutory construction, only if there is
an ambiguity in a statute found in chapter 153A should
section 153A-4 be part of the courts' interpretative process.
If, however, the statute is clear on its face, the plain
language of the statute controls and section 153A-4
remains idle.

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Durham Land Owners Ass’n v. County of Durham, 177 N.C. App. 629, 633-34, 630

S.E.2d 200, 203, disc review denied, 360 N.C. 532, 633 S.E.2d 678 (2006). We conclude

that N.C. Gen. Stat. § 153A-4 is not applicable to the present case.

Defendants also contend that their assessment of impact fees was authorized

under local ordinances. Assuming, without deciding, that the local ordinances cited

by defendants might grant a broader right to impose impact fees than is allowed

under N.C. Gen. Stat. § 162A-88, N.C. Gen. Stat. § 162A-19 provides that “[a]ll

general, special or local laws, or parts thereof, inconsistent herewith are hereby

declared to be inapplicable to the provisions of this Article.” We conclude that

defendants cannot rely upon a local ordinance to extend the right to assess impact

fees beyond what is allowed under N.C. Gen. Stat. § 162A-88.

Defendants have also filed a Memorandum of Additional Authority citing this

Court’s unpublished opinion in Quality Built Homes Inc. v. Town of Carthage, 2015

N.C. App. LEXIS 656 (N.C. Ct. App. Aug. 4, 2015). “An unpublished opinion

‘establishe[s] no precedent and is not binding authority[.]’ ” Long v. Harris, 137 N.C.

App. 461, 470, 528 S.E.2d 633, 639 (2000) (quoting United Services Automobile Assn.

v. Simpson, 126 N.C. App. 393, 396, 485 S.E.2d 337, 339, disc. review denied, 347 N.C.

141, 492 S.E.2d 37 (1997)). Furthermore, the primary issue in Quality Built Homes

was whether the Town of Carthage was authorized to impose fees for service “to be

furnished,” and the case did not address the question of whether the assessment of

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impact fees was a reasonable exercise of governmental authority under circumstances

similar to those presented in this appeal to this Court. We conclude that Quality

Built Homes does not indicate that we should reach a different result in the present

case.

Finally, defendants argue in their appellate brief that “genuine issues of

material fact remain regarding the amount of damages to which plaintiffs may be

entitled.” This argument is without merit.

Plaintiffs produced records in discovery detailing the impact fees that were

assessed against them, and defendants do not dispute the accuracy of the amounts

stated in these records. Defendants’ designee, Mr. Frank Styers, CFPUA’s Chief

Operating Officer, acknowledged in his deposition that these documents were

defendants’ business records and accurately set out the impact fees at issue. (Styers

depo 72-78) Thus, defendants do not challenge plaintiffs’ contentions regarding the

amounts that were paid. Instead, defendants argue that a genuine issue of material

fact arises from the fact that in some instances plaintiffs paid the fees directly, while

in other instances the fees were initially paid by a builder or other third party who

was then reimbursed by plaintiffs. “An issue is ‘genuine’ if it can be proven by

substantial evidence and a fact is ‘material’ if it would constitute or irrevocably

establish any material element of a claim or a defense.” Lowe v. Bradford, 305 N.C.

366, 369, 289 S.E.2d 363, 366 (1982) (citation omitted). Defendants do not articulate

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a defense to plaintiffs’ claims that would be established by evidence that plaintiffs

paid some of the impact fees directly and others as reimbursement to a builder.

Defendants also assert, without citation to any evidence, that plaintiffs may have

increased the sale price of the subject properties or “passed on” the impact fees to

purchasers of homes. Defendants’ contention in this regard is mere speculation. In

addition, defendants do not argue that the legal relationship of the parties would be

affected if, as defendants allege, plaintiffs included their expenses, including impact

fees, in their calculation of the price at which properties were sold. We conclude that

defendants have failed to demonstrate that a genuine issue of material fact exists

that made it improper for the trial court to award summary judgment in favor of

plaintiffs.

We have held that the trial court did not err by granting summary judgment

for plaintiffs on their claim that, on the facts of this case, defendants’ imposition of

impact fees was ultra vires and beyond their authority, and for recovery of plaintiffs’

damages resulting therefrom. Having reached this conclusion, we have no need to

address the parties’ arguments regarding plaintiffs’ claims under the North Carolina

Constitution. We hold that the trial court did not err and that its order should be

AFFIRMED.

Judges STEPHENS and McCULLOUGH concur.

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