#27381-a-JMK
2017 S.D. 78
IN THE SUPREME COURT
OF THE
STATE OF SOUTH DAKOTA
****
MARK AND MARILYN LONG,
ARNIE AND SHIRLEY VAN VOORST,
TIM AND SARA DOYLE,
TIMOTHY AND JANE GRIFFITH
AND MICHAEL AND KAREN TAYLOR, Plaintiffs and Appellants,
v.
STATE OF SOUTH DAKOTA, Defendant and Appellee.
****
APPEAL FROM THE CIRCUIT COURT OF
THE SECOND JUDICIAL CIRCUIT
LINCOLN COUNTY, SOUTH DAKOTA
****
THE HONORABLE PATRICIA C. RIEPEL
Retired Judge
****
MARK V. MEIERHENRY
CHRISTOPHER HEALY
CLINT SARGENT of
Meierhenry Sargent, LLP
Sioux Falls, South Dakota Attorneys for plaintiffs
and appellants.
GARY P. THIMSEN
JOEL E. ENGEL III of
Woods, Fuller, Shultz & Smith, PC
Sioux Falls, South Dakota Attorneys for defendant
and appellee.
****
ARGUED ON
JANUARY 12, 2016
OPINION FILED 11/21/2017
#27381
KERN, Justice
[¶1.] After Landowners prevailed against the State on a claim of inverse
condemnation, Landowners requested that the State pay “reasonable attorney,
appraisal and engineering fees, and other related costs” pursuant to SDCL 5-2-18
and the Uniform Relocation Assistance and Real Property Acquisition Policies Act
of 1970, which is codified at 42 U.S.C. §§ 4601–4655 (2012). The circuit court
denied their request. Landowners appeal. We affirm.
BACKGROUND
[¶2.] In July 2010, Landowners1 suffered significant flooding that damaged
their real and personal properties. Landowners’ properties are located on the west
side of Highway 11, north of the intersection of Highway 11 and 85th Street. The
South Dakota Department of Transportation (DOT) built Highway 11 in 1949 and
the State maintains sole control of Highway 11. Highway 11 runs north and south
through Lincoln and Minnehaha Counties and lies across the natural waterway
known as Spring Creek.
[¶3.] Landowners filed an inverse condemnation claim against the State and
the City of Sioux Falls seeking damages due to the flooding of Landowners’
properties after a heavy rainfall. A court trial was held in February 2014 on the
issue of liability. The circuit court found the construction of Highway 11 and the
inadequate culverts beneath it caused the flooding damage to Landowners’ real and
personal properties. In December 2014, a jury trial was held on the issue of
1. Landowners include Mark and Marilyn Long, Arnie and Shirley Van Voorst,
Tim and Sara Doyle, Timothy and Jane Griffith, and Michael and Karen
Taylor.
-1-
#27381
damages. The jury awarded each set of Landowners individualized damages.2 In
August 2014, Landowners made a motion pursuant to SDCL 5-2-18 and the
Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970
as amended by the Surface Transportation and Uniform Relocation Assistance Act
of 1987 (collectively, “the URA”) for payment of “reasonable attorney, appraisal and
engineering fees, and other related costs.” The URA is codified at 42 U.S.C. §§
4601–4655 (2012). The circuit court denied Landowners’ motion based on Rupert v.
City of Rapid City, 2013 S.D. 13, 827 N.W.2d 55. In January 2015, the circuit court
issued its order denying fees and expenses. Landowners appeal.
[¶4.] We restate Appellants’ issue as follows:
Whether a party who prevails on a claim of inverse
condemnation arising under South Dakota Constitution article
VI, § 13 is entitled to recovery of attorney’s fees and litigation
expenses under SDCL 5-2-18.
STANDARD OF REVIEW
[¶5.] “Questions of statutory interpretation and application are reviewed
under the de novo standard of review with no deference to the circuit court’s
decision.” Deadwood Stage Run, LLC v. S.D. Dep’t of Revenue, 2014 S.D. 90, ¶ 7,
857 N.W.2d 606, 609 (quoting Argus Leader v. Hagen, 2007 S.D. 96, ¶ 7, 739 N.W.2d
475, 478).
ANALYSIS
[¶6.] Landowners contend they are entitled to recovery of attorney’s fees and
litigation expenses under SDCL 5-2-18 as they prevailed on their claim of inverse
2. The State appealed the circuit court’s determination of liability and the jury’s
verdict. See Long v. State, 2017 S.D. 79, ___ N.W.2d ___.
-2-
#27381
condemnation. They assert that the South Dakota Legislature intended to adopt by
reference the URA when it enacted SDCL 5-2-18. The purpose of the URA is to
establish a uniform policy for the fair treatment of persons “displaced as a direct
result of programs or projects undertaken by a Federal agency or with Federal
financial assistance” and to ensure they do not suffer disproportionate injuries due
to a program designed to benefit the public as a whole. 42 U.S.C. § 4621(b).
Displaced persons are defined as “any person who moves from real property, or
moves his personal property from real property” in response to “a written notice of
intent to acquire or the acquisition of such real property in whole or in part for a
program or project undertaken by a Federal agency or with Federal financial
assistance[.]” 42 U.S.C. § 4601(6)(A)(i)(I). The URA contains a section permitting
property owners to “be paid or reimbursed for necessary expenses as specified in
section 4653 and 4654 of this title.” 42 U.S.C. § 4655. Necessary expenses are
defined, in part, in 42 U.S.C. § 4654(c) as “reasonable costs, disbursements, and
expenses, including reasonable attorney, appraisal, and engineering fees[.]”
Landowners further contend that 49 C.F.R. § 24.107 (2015) reinforces the State’s
obligation to pay the Landowners’ inverse condemnation expenses.
[¶7.] The URA places several requirements on the receipt of federal funding
related to the acquisition of land. It is within the power of Congress to “attach
conditions on the receipt of federal funds . . . ‘by conditioning receipt of federal
moneys upon compliance by the recipient with federal statutory and administrative
directives.’” South Dakota v. Dole, 483 U.S. 203, 206, 107 S. Ct. 2793, 2795-96, 97
L. Ed. 2d 171 (1987) (quoting Fullilove v. Klutznick, 448 U.S. 448, 474, 100 S. Ct.
-3-
#27381
2758, 2772, 65 L. Ed. 2d 902 (1980) (plurality opinion)). In certain instances, South
Dakota has complied with federal directives in order to receive federal funding. See
SDCL 35-9-4.1 (noting adoption of laws “under the duress of a funding sanction
imposed by the United States Department of Transportation”).
[¶8.] 42 U.S.C. § 4655 provides, in part:
(a) Notwithstanding any other law, the head of a Federal agency
shall not approve any program or project or any grant to, or
contract or agreement with, an acquiring agency under which
Federal financial assistance will be available to pay all or part of
the cost of any program or project which will result in the
acquisition of real property on and after January 2, 1971, unless
he receives satisfactory assurances from such acquiring agency
that—
...
(2) property owners will be paid or reimbursed for necessary
expenses as specified in sections 4653 and 4654 of this title.
The relevant “necessary expenses” are defined in 42 U.S.C. § 4654(c) which
provides:
The court rendering a judgment for the plaintiff in a proceeding
brought under section 1346(a)(2) or 1491 of title 28, awarding
compensation for the taking of property by a Federal agency, or
the Attorney General effecting a settlement of any such
proceeding, shall determine and award or allow to such plaintiff,
as a part of such judgment or settlement, such sum as will in the
opinion of the court or the Attorney General reimburse such
plaintiff for his reasonable costs, disbursements, and expenses,
including reasonable attorney, appraisal, and engineering fees,
actually incurred because of such proceeding.
(Emphases added.) Additionally, 49 C.F.R. § 24 contains the federal regulations
implementing the URA. 49 C.F.R. § 24.107 addresses entitlement to certain
litigation expenses. It provides:
The owner of the real property shall be reimbursed for any
reasonable expenses, including reasonable attorney, appraisal,
-4-
#27381
and engineering fees, which the owner actually incurred because
of a condemnation proceeding, if:
...
(c) The court having jurisdiction renders a judgment in favor of
the owner in an inverse condemnation proceeding or the Agency
effects a settlement of such proceeding.
[¶9.] The State argues our state statutes and case law do not authorize an
award of attorney’s fees and, consequently, Landowners have no relief under state
law. The State further contends that the application of the URA in state law is
permissive rather than mandatory. The State submits that Landowners are
attempting to read into SDCL 5-2-18 the authority to assess attorney’s fees. Lastly,
the State argues that the primary purpose of the URA is to provide relocation
assistance to persons displaced by condemnation actions instituted by federal
agencies as set forth in 42 U.S.C. § 4621(b). In the State’s view, the “most relevant
portion of the URA for purposes of this appeal is 42 U.S.C. § 4654(c),” which it
argues authorizes an award of attorney’s fees in federal court for federal inverse
condemnation claims. Further, the State submits that the federal regulations
implementing the URA, specifically 49 C.F.R. § 24.107, cannot provide more rights
or remedies than the URA itself. Relying on City of Austin v. Travis County
Landfill Co., 25 S.W.3d 191, 207 (Tex. App. 1999), rev’d on other grounds, 73 S.W.3d
234 (Tex. 2002), the State contends that § 24.107 “[a]t most . . . clarifies that section
4654 applies to governmental entities facing claims in federal court or the Court of
Federal Claims.”
[¶10.] South Dakota adheres to the “American Rule” for awarding attorney’s
fees. Rupert, 2013 S.D. 13, ¶ 32, 827 N.W.2d at 67. The “American Rule” provides
“that each party bears the burden” of paying their own attorney’s fees. Eagle Ridge
-5-
#27381
Estates Homeowners Ass’n, Inc. v. Anderson, 2013 S.D. 21, ¶ 28, 827 N.W.2d 859,
867 (quoting In re S.D. Microsoft Antitrust Litig., 2005 S.D. 113, ¶ 29, 707 N.W.2d
85, 98). However, exceptions to this rule exist. Id. One exception is that attorney’s
fees may be awarded to a prevailing party pursuant to a contractual agreement
between the parties. Id. Another exception is that fees may be ordered “when an
award of attorney fees is authorized by statute.” Id. In determining whether a
statute authorizes the award of attorney’s fees, “[t]his Court has rigorously followed
the rule that authority to assess attorney fees may not be implied, but must rest
upon a clear legislative grant of power.” Rupert, 2013 S.D. 13, ¶ 32, 827 N.W.2d at
67 (quoting In re Estate of O’Keefe, 1998 S.D. 92, ¶ 17, 583 N.W.2d 138, 142).
Similarly, a party may recover costs only as specifically authorized by statute.
DeHaven v. Hall, 2008 S.D. 57, ¶ 48, 753 N.W.2d 429, 444.
[¶11.] The circuit court, relying on the settled case law in Rupert, applied the
American Rule and denied Landowners’ request for attorney’s fees. In Rupert, a
property owner prevailed on a claim for inverse condemnation under Article VI, § 13
of the South Dakota Constitution for damage to trees on his property. Rupert, 2013
S.D. 13, ¶ 6, 827 N.W.2d at 60. Plaintiff requested an award of attorney’s fees
against the City pursuant to SDCL 21-35-23.3 Id. The circuit court denied the
3. SDCL 21-35-23 provides:
If the amount of compensation awarded to the defendant by
final judgment in proceedings pursuant to this chapter is twenty
percent greater than the plaintiff’s final offer which shall be
filed with the court having jurisdiction over the action at the
time trial is commenced, and if that total award exceeds seven
hundred dollars, the court shall, in addition to such taxable
costs as are allowed by law, allow reasonable attorney fees and
(continued . . .)
-6-
#27381
request finding that the statute was specific to condemnation proceedings and not
cases involving inverse condemnation. Id. ¶ 31, 827 N.W.2d at 67. In affirming, the
Court reiterated that “attorney fees may not be awarded pursuant to a statute
unless the statute expressly authorizes the award[.]” Id. ¶ 32, 827 N.W.2d at 67.
Landowners herein argue this holding is inapposite as the claim for attorney’s fees
in Rupert was not made under SDCL 5-2-18. They contend, and we agree, that
their request for attorney’s fees under this statute is a question of first impression
before this Court.
[¶12.] “We begin our interpretation of a statute with [an analysis of] its plain
language and structure.” Puetz Corp. v. S.D. Dep’t of Revenue, 2015 S.D. 82, ¶ 16,
871 N.W.2d 632, 637. SDCL 5-2-18 provides:
The State of South Dakota . . . may provide relocation benefits
and assistance to persons, businesses, and farm operations
displaced as the result of the acquisition of land or rehabilitation
or demolition of structures in connection with federally assisted
projects to the same extent and for the same purposes as
provided for in the Uniform Relocation Assistance and Real
Property Acquisition Policies Act of 1970 (P.L. 91-646) as
amended by Surface Transportation and Uniform Relocation
Assistance Act of 1987 (P.L. 100-17), and may comply with all
the acquisition policies contained in said federal act.
(Emphases added.) The State argues that “[n]othing in [SDCL] 5-2-18 expressly
authorizes attorney fees as required by the American Rule[.]” Pointing to Breck v.
Janklow, 2001 S.D. 28, ¶ 11, 623 N.W.2d 449, 455, the State contends that “the
statute includes the word ‘may’ twice, which this Court has held is construed in the
permissive sense.” In response, Landowners submit that the plain meaning of the
_________________________________
(. . . continued)
compensation for not more than two expert witnesses, all as
determined by the court.
-7-
#27381
statute is to provide assurances, under 42 U.S.C. § 4655, that all programs in South
Dakota will comply with the URA’s acquisition policies. Landowners contend that
“the [L]egislature clearly intended to adopt and agreed to follow the policies of the
URA in order to receive federal funds.”4 The URA, they assert, requires payment of
attorney’s fees and litigation expenses for successful inverse condemnation
claimants.
[¶13.] When conducting statutory interpretation, we determine the intent of
a statute “from what the Legislature said, rather than what [we] think it should
have said, and . . . must confine [ourselves] to the language used.” Puetz Corp.,
2015 S.D. 82, ¶ 16, 871 N.W.2d at 637 (quoting State v. Clark, 2011 S.D. 20, ¶ 5, 798
N.W.2d 160, 162). “Words and phrases in a statute must be given their plain
meaning and effect. When the language in a statute is clear, certain, and
unambiguous, there is no reason for construction, and this Court’s only function is
to declare the meaning of the statute as clearly expressed.” Id.
[¶14.] A reading of the plain language of SDCL 5-2-18 reveals no language
referencing payment of attorney’s fees or expenses. However, Landowners urge us
to consider the legislative history of the statute, arguing that “[t]he clear intent of
4. Landowners claim that the State is heavily dependent upon federal funding
for its highway budget. The State contends that to support this assertion
Landowners have alleged facts without citation to the record as required by
SDCL 15-26A-60(5). Additionally, the State objected to documents in
Landowners’ appendix that were not presented to the circuit court and made
part of the settled record. “Documents in the appendix must be included
within, and should be cross-referenced to, the settled record.” Klutman v.
Sioux Falls Storm, 2009 S.D. 55, ¶ 37, 769 N.W.2d 440, 454 (citing SDCL 15-
26A-60(8)). Factual assertions not supported by the record and documents
not admitted into evidence are not considered herein.
-8-
#27381
the passage of the 1972 and 1988 Session Laws [codified as SDCL 5-2-18] was to
enable state officials to give the federal government the assurance the State would
comply with the [URA].” Landowners contend that the use of “[t]he words ‘to
comply with all the acquisition policies’ [in the 1972 Chapter 136 Session Law] is a
complete acceptance of the federal policies by force of statute.” Landowners do not
address the effect of the substantive amendment to the statute in 1988, which no
longer obligates the State to “provide relocation benefits and assistance” or “comply
with all the acquisition policies” of the URA. Instead, as amended, the statute
indicates that the State may provide such benefits and assistance and may comply
with the URA’s acquisition policies.
[¶15.] Regardless, the State urges us to decline Landowners’ request to
consider the legislative history of SDCL 5-2-18, asserting such review is not
performed when statutory language is clear. We agree with the State. As the
language of the statute is clear and unambiguous, our only function is to declare the
meaning of the statute as clearly expressed. Clark Cty. v. Sioux Equip. Corp., 2008
S.D. 60, ¶ 28, 753 N.W.2d 406, 417. We do not review legislative history unless the
statute is ambiguous. Bertelsen v. Allstate Ins. Co., 2009 S.D. 21, ¶ 15, 764 N.W.2d
495, 500.
[¶16.] SDCL 5-2-18 indicates that the State may provide relocation benefits
and assistance and may comply with the URA’s acquisition policies. We have “held
that the word ‘may’ should be construed in a permissive sense unless the context
and subject matter indicate a different intention.” Breck, 2001 S.D. 28, ¶ 11, 623
N.W.2d at 455.
-9-
#27381
Although the form of verb used in a statute, i.e., whether it says
something “may,” “shall” or “must” be done, is the single most
important textual consideration determining whether a statute
is mandatory or directory, it is not the sole determinant. Other
considerations, such as legislative intent, can overcome the
meaning which such verbs ordinarily connote. In our search to
ascertain the legislature’s intended meaning of statutory
language, we look to the words, context, subject matter, effects
and consequences as well as the spirit and purpose of the
statute.
In re Estate of Flaws, 2012 S.D. 3, ¶ 18, 811 N.W.2d 749, 753 (quoting Matter of
Groseth Int’l, Inc., 442 N.W.2d 229, 232 n.3 (S.D. 1989) (citing 2A Sutherland Stat.
Const. § 57.03 at 643-44 (4th ed. 1984))). We hold that the plain language of this
statute provides that compliance with the URA is permissive rather than
mandatory.
[¶17.] Landowners rely on cases from Nevada and Kansas in support of their
position that the URA permits imposition of litigation fees for successful plaintiffs,
even without an independent state statute authorizing such payment.5
Landowners’ authorities, however, are readily distinguishable. Citing McCarran
International Airport v. Sisolak, 137 P.3d 1110, 1129 (Nev. 2006), Landowners
contend that “Nevada’s method of adoption of the URA is strikingly similar to South
Dakota’s[.]”
[¶18.] In McCarran, the Nevada Supreme Court affirmed the lower court’s
determination that plaintiff was entitled to an award of attorney’s fees and costs
after prevailing on his claim of inverse condemnation for the taking of his airspace
5. Landowners also rely on federal correspondence from the Comptroller
General to members of Congress. As we have declined to consider the
legislative history of the enactment of the URA or SDCL 5-2-18, we do not
consider this type of communication to members of Congress.
-10-
#27381
near the Municipal Airport. Id. at 1128. While Nevada’s statute does refer to the
URA, there is an important distinction between Nevada’s statute and ours. N.R.S.
342.105 mandates compliance with the Relocation Act, requiring that any entity
subject to the act “shall provide relocation assistance” in contrast to the permissive
language of SDCL 5-2-18. Such mandatory compliance is also noted in the statute’s
title: “Compliance with federal law required; adoption of regulations by Director of
Department of Transportation[.]” Nev. Rev. Stat. Ann. § 342.105 (West).
[¶19.] The Landowners also rely on two Kansas cases, Bonanza, Inc. v.
Carlson, 9 P.3d 541 (Kan. 2000), and Estate of Kirkpatrick v. City of Olathe, 215
P.3d 561 (Kan. 2009), both awarding attorney’s fees to prevailing parties for their
state inverse condemnation claims. Both are inapposite. Kansas has enacted
statutes similar to the URA and adopted by reference both the URA and the federal
regulations implementing it. See Kan. Admin. Regs. § 36-16-1; Bonanza, 9 P.3d at
543. Having adopted 49 C.F.R. § 24 and its amendments by reference, K.A.R. 36-
16-1 provides “(b) The provisions of 49 C.F.R. Part 24 . . . and all amendments
thereto, shall be applicable to all acquisitions of real property by the department of
transportation . . . .” (Emphasis added.) The court in Bonanza held
The authority for the award sought by the landowners are
Kansas statutes and Kansas regulations enacted by the Kansas
Legislature to comply with federal law. Under the Kansas
regulations, state agencies receiving federal financial assistance
are required to reimburse owners for incidental expenses and
litigation expenses as provided in the federal statute as a
precondition for receiving federal monetary assistance.
9 P.3d 541 at 547. These cases do not lend support for Landowners’ claims because
the courts of Nevada and Kansas were interpreting specific state statutes that
mandated the payment of successful plaintiffs’ litigation expenses. In contrast, the
-11-
#27381
South Dakota Legislature has not mandated compliance with the URA and has not
abrogated the State’s sovereign immunity for the payment of litigation expenses.
As we noted in Rupert, “abrogation of sovereign immunity by the Legislature must
be express.” 2013 S.D. 13, ¶ 33, 827 N.W.2d at 67.
[¶20.] This Court has on one prior occasion interpreted the URA and SDCL 5-
2-18—although the precise question of whether SDCL 5-2-18 mandates compliance
with the URA was not addressed. Rapid City v. Baron, 88 S.D. 693, 227 N.W.2d
617 (1975). In Baron, the City of Rapid City and Baron disputed the value of
Baron’s property which was condemned by the City along with 1,300 other
properties after the 1972 flood in order to create a flood plain. Id. at 694-95,
227 N.W.2d at 618. Baron sought admission of evidence regarding the values of
other properties paid for by the City as part of its urban renewal program. Id. at
696, 227 N.W.2d at 618-19. Baron argued that the policy of the URA was to “assure
consistent treatment for owners in the many Federal programs.” Id. at 695, 227
N.W.2d at 618. The circuit court admitted the evidence and instructed the jury that
they could consider the prices paid by the City to other owners when measuring
damages. Id. at 695-96, 227 N.W.2d at 618-19.
[¶21.] We reversed, citing to Article VI, § 13 of the South Dakota
Constitution, which requires that “just compensation” be paid as determined by the
legal procedures established by the Legislature—not under the policy language
from the URA. Id. at 698, 227 N.W.2d at 620. We determined that the court erred
by failing to instruct the jury of the correct measure of damages and permitting
evidence on the value of other properties taken by the City. Id. at 699, 227 N.W.2d
-12-
#27381
at 620. We noted that there was “no compelling reason to hold that the quoted
phrase from [§] 4651, 42 U.S.C.A., even when read in conjunction with SDCL 5-2-
18, in any manner modifies our Constitution, statutes or case law.” Id. at 699, 227
N.W.2d at 620. Although we were not asked in Baron to determine if application of
the URA was mandatory, we did find the circuit court erred by utilizing language
from the URA inconsistent with South Dakota law. As discussed previously, South
Dakota has adopted the American Rule requiring each party to bear its own
attorney’s fees unless exceptions exist. Landowners have put forth no compelling
reason to modify our adoption of the American Rule.
[¶22.] In forming our opinion, we also find persuasive two cases cited by the
State: Travis County Landfill Co., 25 S.W.3d 191, and Randolph v. Missouri
Highways & Transportation Communication, 224 S.W.3d 615 (Mo. Ct. App. 2007).
In Travis, the plaintiff who prevailed on a state inverse condemnation claim argued
it was entitled to recovery of attorney’s fees under the URA. 25 S.W.3d at 207. The
Court of Appeals of Texas determined that, “section 4654 provides authority for the
award of attorney’s fees and expenses in actions brought in either federal court or
the Court of Federal Claims. The Uniform Act contains no express authority for a
similar award for state causes of action filed in state court.” Id. The court also
considered 49 C.F.R. § 24.107, stating that “[a]t most, section 24.107 clarifies that
section 4654 applies to governmental entities facing claims in federal court or the
Court of Federal Claims. It does not provide statutory authority for state courts to
award attorney’s fees for successful inverse condemnation claims arising under
state law.” Id.; see also 8A Patrick J. Rohan & Melvin A. Reskin, Nichols on
-13-
#27381
Eminent Domain § G20.05[3] (3d ed. 2015) (§ 4654 applies only to takings by a
federal agency not to an award under a state condemnation action). Lastly, the
court analyzed 42 U.S.C. § 4655, finding the section “governs the relationship
between the City and the federal agency from which it seeks federal funds. It does
not create a landowner’s cause of action for attorney’s fees in the event the City fails
to comply with the land acquisition policies outlined in the statute.” Id. at 208.
[¶23.] In Randolph, the Missouri Court of Appeals considered the question of
whether the URA and 49 C.F.R. § 24.107 authorize attorney’s fees for a state claim
of inverse condemnation. 224 S.W.3d at 619. Missouri, like South Dakota, follows
the “American Rule” requiring “each party to bear the expense of their own attorney
fees.” Id. The court determined the URA “would only be applied where Missouri
law does not expressly prohibit its application,” noting that “Missouri law expressly
prohibits the application of attorney fees absent statutory authority.” Id. at 619-20.
The court affirmed the lower court’s denial of attorney’s fees in accordance with the
long-standing and strict application of the American Rule in Missouri and the
prohibition of awarding costs against state agencies. Id. at 620.
[¶24.] The circuit court’s denial of Landowners’ motion is supported by the
holdings in Travis and Randolph. First, Landowners’ claim was not brought in
federal court or the Court of Federal Claims. The plain language of 42 U.S.C. §
4654(c) defining necessary expenses provides that it applies to “proceeding brought
under section 1346(a)(2) or 1491 of Title 28, awarding compensation for the taking
of property by a Federal agency[.]” Second, as the court held in Randolph, the
application of the URA contradicts strict application of the American Rule.
-14-
#27381
CONCLUSION
[¶25.] The circuit court did not err in denying Landowners’ motion for
attorney’s fees and expenses as they are not authorized by the plain language of
SDCL 5-2-18. While SDCL 5-2-18 incorporates by reference the provisions of the
URA, its application is permissive rather than mandatory. Even if mandatory, the
URA does not create a private cause of action in state courts for payment of
litigation expenses in inverse condemnation cases unless mandated by state statute
or implementing regulations. The circuit court did not err in denying Landowners’
motion for attorney’s fees and expenses. We affirm.
[¶26.] GILBERTSON, Chief Justice, and ZINTER, and SEVERSON, Justices,
and BARNETT, Circuit Court Judge, concur.
[¶27.] BARNETT, Circuit Court Judge, sitting for WILBUR, Retired Justice,
disqualified.
[¶28.] JENSEN, Justice, not having been a member of the Court at the time
this action was submitted to the Court, did not participate.
-15-