Housing & Redevelopment Authority ex rel. City of Richfield v. Adelmann

PAUL H. ANDERSON, J.

(concurring specially).

I concur in the result reached by the majority, but write separately to address the underlying issue of subject-matter jurisdiction. My hope is that by addressing this issue, we can resolve ambiguities and misunderstandings created by prior opinions of our court and the Minnesota Court of Appeals.

For well over a century, it has been our position that a district court acquires subject-matter jurisdiction over eminent domain proceedings upon the presentation to the court of a proper condemnation petition showing a right on the part of the petitioner to acquire the land described in the petition. See Rheiner v. Union Depot St. Ry. & Transfer Co., 31 Minn. 289, 294, 17 N.W. 623, 624 (1883). In Rheiner, a landowner challenged the district court’s subject-matter jurisdiction on grounds that the landowner received no notice of and had no knowledge of an amended condemnation petition or a subsequent commissioners’ hearing until after the commissioners’ award was filed. Id. at 292-93, 17 N.W. at 624. We recognized a jurisdictional defect, but concluded that the defect went to personal jurisdiction, not subject-matter jurisdiction. Id. at 293-94, 17 N.W. at 624-25. We held that a district court is vested with subject-matter jurisdiction upon *334the presentation of a proper condemnation petition and that service of notice is designed only for the purpose of investing the court with jurisdiction over the persons interested in the proceeding. Id. at 294, 17 N.W. at 624-25. Thus, in Rheiner, we clearly articulated a bright line distinction between subject matter and personal jurisdiction in eminent domain proceedings. Id., 17 N.W. at 624-25.

Five years later, in Whitely v. Mississippi Water-Poiuer & Boom Co., 38 Minn. 523, 38 N.W. 753 (1888), we reaffirmed Rheiner when we again held that presenting and filing of the condemnation petition gave a district court subject-matter jurisdiction. Id. at 525-26, 38 N.W. at 755. We went on to conclude that because subject-matter jurisdiction is vested in the court upon the presenting and filing of the petition, an irregularity in the place named for the presentation of the petition could be waived. Id., 38 N.W. at 755. We held that, even if the defect went to the court’s jurisdiction over the plaintiff, this defect as to personal jurisdiction was waived when the party appeared and took part in the proceedings before the commissioners and then appealed the award. Id. at 526, 38 N.W. at 755.

A third case in which we articulated our position with respect to subject-matter jurisdiction in eminent domain matters is State v. Frisby, 260 Minn. 70, 108 N.W.2d 769 (1961). In Frisby, we held that there was no prejudice to a landowner when the commissioners failed to comply with the provisions of Minn. Stat. § 117.08 (1960) requiring separate awards for the value of land taken and for damages to other property. Id. at 78, 108 N.W.2d at 774. We concluded that the apportionment of damages provisions of the statute were not jurisdictional requirements. Id. at 77, 108 N.W.2d at 773. In reaching our conclusion in Fnsby, we cited Rheiner and said:

[t]he court acquired jurisdiction by the presentation of the petition to the district court in accordance with the provisions of [the] statute showing the right on the part of the state to acquire the land and by statutory notice to persons interested in the property of the time and place of the presentation of the petition.

Id. at 76, 108 N.W.2d at 773 (citing Rheiner, 31 Minn, at 289, 17 N.W. at 623). We went on to conclude that noncompliance with the requirements of section 117.08 would not defeat the court’s subject-matter jurisdiction, saying:

[i]t was not the intention of the legislature, after prescribing in detail for review of the award on appeal, to leave the landowner in a position where he could oust the court of jurisdiction because of an omission in the original report which might be supplied in the trial on appeal.

Id. at 77, 108 N.W.2d at 773. See also Oronoco Sch. Dist. v. Oronoco, 170 Minn. 49, 52, 212 N.W. 8, 9 (1927) (holding (1) that an eminent domain proceeding is in rem and not in personam and (2) when subject-matter jurisdiction is conferred upon a court in eminent domain proceedings and no procedures are provided by the statute, the court can proceed under its general powers and adopt such procedures as are necessary to exercise and make effective the jurisdiction thus granted).

In the case before us today, it appears that both the HR.A and respondents take for granted that the district court’s subject-matter jurisdiction was divested upon appointment of the commissioners and that subject-matter jurisdiction could not be reestablished absent strict adherence to the appeal procedures of Minn.Stat. § 117.145 (1998). The basis of this erroneous assumption appears to be the court of appeals decision in Independent Sch. Dist. No. 19Jp Lakeville v. Tollefson Dev., Inc., 506 N.W.2d 346 (Minn.App.1993), pet. for rev. denied (Minn. Nov. 16,1993). In order to correct this erroneous assumption, it is important that we understand how Tollef-son came to be.

In Tollefson, the court of appeals recognized that the statute that preceded the current section 117.145 required that notice of a condemnation appeal be served on “ ‘all parties of record having an interest in the [sic] lands described in the appeal.’ ” Id. at 348 (quoting Minn.Stat. § 117.145 (1992)). The court held that this was an absolute jurisdictional requirement and that failure to serve *335all parties having any recorded interest in the condemned property deprived the district court of jurisdiction on appeal from the commissioners’ award. Id. Based on this holding, the court in Tollefson vacated a jury verdict entered after the district court heard a condemnation appeal on the grounds that three commercial lessees of the eondemnee had not been mailed notice of the appeal. Id. at 347-48. The Tollefson holding was a radical departure from the normal procedures followed in condemnation proceedings and has caused considerable disruption and uncertainty in the practice of eminent domain law.

In reaching its holding in Tollefson, the court of appeals relied on Judd v. State, 488 N.W.2d 843 (Minn.App.1992). See Tollefson, 506 N.W.2d at 347. In Judd, the court of appeals noted that “[i]t is unquestioned that if an appeal is not filed within the 40-day statutory period, the district court does not acquire jurisdiction and cannot expand the statutory filing period.” 488 N.W.2d at 844 (citing State v. Goins, 286 Minn. 54, 57, 174 N.W.2d 231, 233 (1970)). In Goins, we stated in dictum that “[t]he filing of [a] notice of appeal is jurisdictional” and that “unless the conditions prescribed by statute are observed, [a district] court acquires no jurisdiction.” Goins, 286 Minn. at 57, 174 N.W.2d at 233 (citing State v. Radosevich, 249 Minn. 268, 82 N.W.2d 70 (1957)).

In Radosevich, we said that “[i]t is elementary that the right of appeal under our condemnation proceedings is governed by statute and that, unless the conditions prescribed by statute are observed, the court acquires no jurisdiction.” Radosevich, 249 Minn, at 271, 82 N.W.2d at 72 (citation omitted). In support of its holding, the Radosevich court, without analysis, cited to State ex rel. Minneapolis v. Boucher, 171 Minn. 297, 214 N.W. 30 (1927), and Klein v. St. Paul, M. & M.. Ry. Co., 30 Minn. 451, 16 N.W. 265 (1883). See Radosevich, 249 Minn, at 271 n. 1, 82 N.W.2d at 72 n. 1. But when we examine Boucher and Klein, we come to understand that the holdings in both cases are inapplicable to the fact situations of the line of cases used to support the holding in Tollefson. This line of cases either overlooked or misread the statutory predicate for the Boucher and Klein decisions and, further, completely ignored the on-point holdings in Rheiner and its progeny.

Neither Boucher nor Klein dealt with chapter 117 of Minnesota statutes or its antecedents. Boucher dealt with the application of Mason’s Minn.Stat; § 1554 (1927), the for-ebearer of Minn.Stat. § 430.03 (1998). See Boucher, 171 Minn, at 298, 214 N.W. at 31; see also Minn.Stat. Ann. § 430.03 (West 1987). This statute provided that a condemnation proceeding began with a resolution by the city council rather than a filing with the district court. See Boucher, 171 Minn, at 298, 214 N.W. at 31. The council then appointed five commissioners to determine and award the amount of damages and compensation to be paid to the owners of property taken or injured by the improvement. Id., 214 N.W. at 31. All interested parties were to be given a notice by publication of the amounts awarded as compensation and the time and place of the meeting of the committee designated by the council to hear objections to the awards. Id., 214 N.W. at 31. The owners of the property were to be served with copies of the notice by the city clerk. Id., 214 N.W. at 31. The land owner was then required to file written objections that were presented to the committee, along with the report of the commissioners. Id. at 298-99, 214 N.W. at 31. The committee reported back to the city council and the council then made its decision. Id., 214 N.W. at 31. The statute provided for an appeal to the district court from the decision of the city council, which appeal was the first invocation of the district court’s jurisdiction. Id. at 299, 214 N.W. at 31. The statute required that the notice of appeal refer to the objections previously filed. Id., 214 N.W. at 31.

The Boucher court disallowed the appellant landowner’s appeal, pointing out that because the landowner had failed to file written objections — even though the landowner had appeared and made oral objections— there would be nothing before the court to decide because the appeal notice required a statement of objections alone and not a pleading. Id., 214 N.W. at 31. The requirement for the landowner to refer to objections *336in the notice of appeal was held to be jurisdictional because the statute required that the appeal be based solely upon objections considered by the committee. Id., 214 N.W. at 31. However, reliance on Boucher ignores a very important distinction between the Boucher statutory scheme and eminent domain proceedings brought under Minn.Stat. § 117, i.e., that district comets acting pursuant to Minn.Stat. § 117 acquire jurisdiction at the very beginning of the taking process.

Reliance on Klein is equally ill founded. In Klein, the appeal was dismissed for lack of jurisdiction because, having served her appeal, the would-be appellant failed to file the appeal with the clerk of district court. Klein, 30 Minn, at 451-52, 16 N.W. at 265. This appeal was brought under the terms of the defendant railroad’s charter and the statute governing such appeals. Id. at 452, 16 N.W. at 265. The attempted filing of this appeal appears to have been the first attempt to invoke the district court’s subject-matter jurisdiction. See id. at 452, 16 N.W. at 265. Thus, in Klein as in Boucher, a fundamentally different statutory scheme was involved and hence a fundamentally different rule of law was applicable. Accordingly, it becomes clear that the court of appeals in Tollefson erred when it relied upon the Boucher and Klein line of eases.

Unfortunately, our court is not completely blameless for some of the confusion that exists in this area of the law. We have repeatedly recited the principle that it is elementary that the right to appeal in an eminent domain proceeding is governed by statute and that, unless the conditions prescribed by statute are observed, the district court acquires no jurisdiction. See, e.g., Goins, 286 Minn, at 57, 174 N.W.2d at 233. See also County of Hennepin v. Holt, 296 Minn. 164, 168, 207 N.W.2d 723, 726 (1973) (holding that “[i]t is elementary that the right of appeal from condemnation proceedings is strictly statutory, and unless the statutory provisions are followed, the court obtains no jurisdiction”); State v. May, 204 Minn. 564, 565, 285 N.W. 834 (1939) (holding that “[t]he right of appeal is strictly statutory and unless the statute authorizes a joint appeal from separate awards, the appeal must be dismissed for duplicity”). But when we have repeated this principle, we have failed to make clear what we mean by jurisdiction. Specifically, we have failed to clarify the distinction between subject-matter jurisdiction and personal jurisdiction that we made over a century ago in Rheiner.

Now is the time for us to reaffirm the holding of Rheiner and its progeny and to make clear that once a district court acquires subject-matter jurisdiction, that jurisdiction is retained and continues even after commissioners are appointed, a commissioners’ hearing is held, and an award is made. Such a rule acknowledges the practical realities of eminent domain proceedings and results in a more sound legal analysis with respect to the implementation of chapter 117 appeal procedures.

A holding that recognizes that the district court retains subject-matter jurisdiction acknowledges the practical, real-world procedures involved in eminent domain proceedings. For example, a new petition proceeding would not be necessary when replacement commissioners were needed. Rather, if during the commissioners’ proceedings, a commissioner should die or become disabled, the parties could simply return to the district court under the aegis of the initial proceeding and move for the replacement of a commissioner or to proceed with fewer than three commissioners. Similarly, if procedural difficulties were encountered during the proceedings before the commissioners, again, without question, the parties could return to the district court for a resolution of any matters in dispute. Likewise, if issues arose with respect to the scope of the taking or claims involving loss of a going concern, the parties could return to the district court without facing questions of subject-matter jurisdiction. I know from my own legal practice — which predates Tollefson — that the district courts have routinely exerted subject-matter jurisdiction over such issues, even after the commissioners had been appointed and commissioners’ hearings were being held. Further, my experience tracks with the experience of other attorneys who practice in the area of eminent domain and with a *337common sense interpretation of chapter 117.

A rule that the district court retains subject-matter jurisdiction is consistent with another important provision of chapter 117; specifically, section 117.175, subd. 1 which provides for the joinder of additional parties on appeal:

Such appeal may be noticed for trial and tried except as herein otherwise provided as in the case of a civil action and the court may direct that issues be framed, and require other parties to be joined and to plead therein when necessary for the proper determination of the questions involved. Minn.Stat. § 117.175, subd. 1 (1998).

Moreover, the history of section 117.145 suggests that notice provisions were added to the statute for purposes less radical and more pragmatic than to deprive a district court of subject-matter jurisdiction if a party failed to strictly comply with the notice -requirements. Prior to 1971, the statute providing for appeals from commissioners’ awards provided:

At any time within 30 days after service of the notice that the report has been filed, the owner of lands taken may appeal to the district court from any award of damages embraced in the report, or from any omission to award damages to the appellant * * * by filing with the clerk a notice of such appeal.

Minn.Stat. § 117.13 (1969). In 1971, however, the legislature revised this provision to add a mailing requirement:

At any time within 40 days from the date that the report has been filed, any party to the proceedings may appeal to the district court from any award of damages embraced in the report, or from any omission to award damages, by filing with the clerk a notice of such appeal and mailing a copy of such notice to all parties of record having an interest in lands described in the appeal. Within ten days of the date of mailing, any other party may appeal.

Act of May 27, 1971, ch. 595, § 18, 1971 Minn. Laws 1102, 1108 (codified at Minn. Stat. § 117.145 (1971)) (emphasis added). Thus, prior to the 1971 revision, parties were not mailed notice if another party appealed the condemnation commissioners’ award. Instead, a party needed to keep- a vigilant eye on the clerk of court’s office to determine if an appeal was filed before the expiration of the appeal period. When the legislature revised section 117.145 to include a requirement that an appealing party mail notice of the appeal to all parties of record, the legislature put an end to this need for the parties to literally wait at the courthouse steps for a possible appeal. In essence, the amendment merely simplified the procedure by which parties learned of an appeal of the commissioners’ award and of the triggering of the timeframe for filing a cross-appeal. Given the obvious pragmatic reason for creating the notice mailing requirements, I believe that a conclusion that mailing the notice of appeal is a subject-matter jurisdictional requirement raises the significance of this requirement to a level that the legislature never intended.

Furthermore, by holding that the district court retains subject-matter jurisdiction, we can avoid the often-harsh consequences of the rule that reached fruition in Tollefson. On at least one prior occasion, when faced with the harsh consequences mandated by strict subject-matter jurisdiction requirements, we made an attempt to avoid those consequences. The case to which I refer is State v. Jude, 258 Minn. 43, 102 N.W.2d 501 (1960).

In Jude, the appellant was a landowner whose property was condemned by the state. Id. at 43, 102 N.W.2d at 502. The appellant filed a timely notice of appeal of the award to the district court. Id. The notice complied with all the statutory requirements except that it did not state the amount of the appellant’s claim. Id., 102 N.W.2d at 502. At the time, Minn.Stat. § 117.20, subd. 4 required among other things that the notice of appeal specify the “amount of the claim.” Id. at 43-44, 102 N.W.2d at 502-03. The state filed a motion to dismiss the appeal on the grounds that the court lacked jurisdiction because the amount of the claim was not shown. Id. at 44, 102 N.W.2d at 503. The district court granted the motion, noting that the results may be harsh, but the statute is jurisdiction*338al. Id., 102 N.W.2d at 503. We reversed the lower court holding that the proper course of action in this situation was to allow the appellant to amend his notice of appeal to comply with the statute. Id. at 45, 102 N.W.2d at 503-04. In our opinion, we made some observations as to general principles which should apply in these circumstances.

We first made reference to language used in the case of State v. Rust, 256 Minn. 246, 98 N.W.2d 271 (1959) to emphasize that attempts on the part of the condemnor to defeat a landowner’s right to his day in court are not looked on with favor, especially when the constitutional right to just compensation for the taking of land is involved. Quoting Rust, we said:

“[t]he decisions in this state have never unduly restricted the owner’s constitutional right to just compensation where there has been a taking of private property for public use under the powers of eminent domain. Attempts on the part of condem-nor by technical means to defeat the landowner’s right to his day in court have never been viewed with favor. Every owner is constitutionally entitled to a just and equal application of the rule that what he owns shall not be taken from him or destroyed or damaged for public use without just compensation.”

Jude, 258 Minn, at 44, 102 N.W.2d at 503 (quoting Rust, 256 Minn, at 253, 98 N.W.2d at 276). We then noted in Jude that this principle had been applied in Radosevich, when “the court held that a party having an interest in tracts of land as to which there were several awards is not bound by the parcel designation made by the condemnor, and may properly appeal by filing a single notice.” Id. (referencing Radosevich, 249 Minn, at 268, 82 N.W.2d at 70). Finally, in Jude, we said: “The rule to be drawn from our cases, and which is now declared by this court, is that under the statute referred to [Minn.Stat. § 117.20, subd. 4] the filing of the notice of appeal is jurisdictional, but the form and contents of the notice are not.” Jude, 258 Minn, at 45, 102 N.W.2d at 503. We concluded that, while the requirements of the statute regarding the content of the notice of appeal are not to be disregarded, “a court has inherent power to permit pleadings to be amended at any proper time when the amendment does not violate some positive rule of law or prejudice the opposing party.” Id., 102 N.W.2d at 503. In support of our conclusion, we referenced our rules of civil procedure relating to the amendment of pleadings. Id., 102 N.W.2d at 503 (referencing Minn. R. Civ. P. 15). While not specifically addressing a district court’s retention of subject-matter jurisdiction in eminent domain proceedings, the court in Jude went to great lengths to reach a result that in essence acknowledged such retention of subject-matter jurisdiction.

Where does all of this lead us in the context of the case before us today? As I indicated earlier, I do not disagree with the majority’s analysis nor do I disagree with the majority’s conclusion that the HRA did comply with the notice requirements of section 117.145. However, while the majority’s analysis is sound as far as it goes, it is made unduly difficult because of our unwillingness to hold that the district court retained subject-matter jurisdiction. It is important that we once and for all establish the correct basis upon which the notice of appeal provisions of section 117.145 are to be construed. We must clearly state that the analysis and conclusion of the court of appeals in Tollefson were wrong. Further, while I believe that our analysis in County of Dakota v. Lyndale Terminal, 529 N.W.2d 672 (Minn.1995), was correct as far as it went, we must acknowledge that in Lyndale Terminal we left unanswered the underlying and fundamental question of retained subject-matter jurisdiction. The court of appeals’ decision in Tollef-son and our failure to properly address this issue in Lyndale Terminal probably resulted in the 1995 amendment to section 117.145, an amendment which has failed to eliminate or even mitigate the confusion and uncertainty brought about by Tollefson. In the future, any analysis with respect to the notice of appeal provisions of section 117.145 should be considered in the context of the district court’s retained subject-matter jurisdiction. In addition to being based on common sense and sound legal precedent, such an interpretation would also ameliorate the harsh results reached in the court of appeals in Judd, *339Tollefson, Lyndale Terminal, and in Condemnation by Housing & Redev. Auth. v. Suh, 553 N.W.2d 115 (Minn.App.1996) and would permit courts to proceed on a more sound basis of practice and procedure.