City of Northglenn v. Grynberg

Justice ERICKSON

Specially concurring in the result:

I agree that in this case, private property was not unconstitutionally taken or damaged under article II, section 15 of the Colorado Constitution (the “Taking Clause”). I write separately, however, to address the question of when property is unconstitutionally “taken” or “damaged” in an inverse condemnation proceeding, an issue that the majority only summarily discusses.

I

In 1977, the City of Northglenn began a search for potential sites for a wastewater reservoir which would become part of a comprehensive wastewater treatment project.1 One of the ten potential sites selected was the West half of Section 36, Township 1 North, Range 68 West of the 6th P.M. in Weld County, Colorado (the site). The mineral estate of the site had been severed from the surface estate and was owned by the State of Colorado, which issued a coal lease to Jack Grynberg.

By February 1978, Northglenn had selected the site as the best location for the reservoir. Northglenn began negotiations with the surface owner to acquire the reservoir site and subsequently announced publicly that the site had been selected for the reservoir.

Northglenn obtained permission from the surface owner to drill test holes on the site to assess the suitability of the site for construction of the reservoir, but did not obtain the permission of either the State of Colorado or Grynberg. An engineering consultant prepared a geology and soils investigation report based on the information obtained from the drilling and filed the *186report with the state engineer’s office on April 25, 1978.

On June 1, 1978, Northglenn purchased the surface estate for $609,000. Grynberg assigned his coal lease to his wife on March 3, 1980. In November 1980, Grynberg brought suit against Northglenn asserting numerous claims for relief, including an inverse condemnation claim. Not until March 1981, did Northglenn begin actual construction of the reservoir on the site.

II

The question in this case is whether property was unconstitutionally taken or damaged prior to the assignment of the coal lease by Grynberg to his wife. The two procedural devices for guaranteeing that private property will not be unconstitutionally taken or damaged for public use without just compensation are eminent domain and inverse condemnation.

While a public entity seeks to condemn property and pay just compensation in an eminent domain action, a property, owner must commence an inverse condemnation action. United States v. Clarke, 445 U.S. 253, 257, 100 S.Ct. 1127, 1130, 63 L.Ed.2d 373 (1980) (stating that inverse condemnation is a “shorthand description of the manner in which a landowner recovers just compensation for a taking of his property when condemnation proceedings have not been instituted”); State Dept. of Health v. The Mill, 809 P.2d 434, 437 (Colo.1991) (same). An inverse condemnation action often arises because the public entity has refused to exercise its eminent domain power. Morrison v. City of Aurora, 745 P.2d 1042, 1045 (Colo.App.1987) (noting that an inverse condemnation action is the taking of private property by a public entity which has refused to exercise its eminent domain power). In an inverse condemnation action, the property owner must establish that a taking or damage occurred, whereas in an eminent domain action, the condemning authority sets forth with specificity the property that is to be taken.

The difficult question in an inverse condemnation action is when the property is taken or damaged. In a physical taking case, the taking or damage “occurs” at a certain point and the unconstitutional taking or damage continues until the taking or damage ceases, or just compensation is paid. State Dept. of Health, 809 P.2d at 438. Under eminent domain, the taking or damage occurs contemporaneously with the institution of the condemnation proceedings. Because there is no “condemnation proceeding” in an inverse condemnation action, however, there is no one single uniform date at which the taking or damage “occurs.” Instead, in an inverse condemnation'action, courts examine the question of whether the Taking Clause has been violated and then determine the date when the property was taken or damaged.2

Ill

A

In William E. Russell Coal Co. v. Board of County Comm’rs, 129 Colo. 330, 270 P.2d 772 (1954), we addressed a similar claim in an action brought by the holder of a mineral estate for a violation of the Taking Clause. The public entity acquired the surface estate by condemnation in order to construct a road but did not condemn the mineral estate. The public entity essentially argued that it was not required to compensate the holder of the mineral estate because the road was not yet constructed and because it had acquired only the surface estate.

We disagreed and held that “when land is acquired by condemnation for a highway, the condemnor acquires not only what is understandably known as just the surface [but] whatever is necessary for the support of the surface.” Russell Coal, 129 Colo. at *187334-35, 270 P.2d at 774. We recognized that the duty of a mineral estate holder to support the proposed construction imposed an additional servitude on the mineral estate and unconstitutionally damaged his property rights. Id.

We stated that “if a duty rests upon the owner of the mineral rights to preserve and support the highway by not having the benefit of his mineral property right, it then follows that he suffers a damage for which compensation should flow.” Id. at 334, 270 P.2d at 774 (emphasis added). The critical question in this case therefore is whether Grynberg lost the benefit of his property right prior to his assignment of the mineral estate to his wife.3

B

Two separate estates are created when the mineral rights are severed from the surface estate. See Simson v. Langholf, 133 Colo. 208, 215-17, 293 P.2d 302, 307 (1956). The majority recognizes that the owner of the severed mineral estate owes a duty of subjacent support to the surface estate in its natural state. Maj. op. at 180-181.4

However, the majority ignores the corresponding property rights that comprise a *188severed mineral estate. The owner of a mineral estate also possesses rights of ingress, egress, exploration, and surface usage as are reasonably necessary to the successful exploitation of his mineral interest. Rocky Mountain Fuel Co. v. Heflin, 148 Colo. 415, 422, 366 P.2d 577, 580 (1962); Chambers-Liberty Counties Navigation Dist. v. Banta, 453 S.W.2d 134, 136 (Tex.1970).5 Grynberg also claims that in Grynberg v. City of Northglenn, 739 P.2d 230 (Colo.1987) [hereinafter Grynberg /], we recognized an additional and exclusive property right of the owner of the mineral estate to consent to geophysical exploration that is constitutionally actionable. In my view, Grynberg mischaracterizes our holding in Grynberg I.6

Actionable constitutional damage occurs if a public entity deprives the owner of the mineral estate the benefit of his mineral property right. Russell Coal, 129 Colo, at 334, 270 P.2d at 774.7 In many cases, the date of construction on the surface estate will serve as the date of the taking or damage to the severed mineral estate. In my view, however, the holder of a mineral estate need not wait for construction to actually begin on the surface estate to bring an inverse condemnation action if he can establish that the public entity has deprived him of the benefit of his mineral property right.8

In this case, however, Grynberg was not prevented from asserting his rights in the mineral estate prior to the conveyance to his wife. See Chambers-Liberty, 453 S.W.2d at 137 (holding that until an interference with a property right occurs, the public entity is not required to pay compensation). Accordingly, I concur with the majority’s conclusion that property was not unconstitutionally taken or damaged.9

*189I am authorized to say that Justice KIRSHBAUM joins in this special concurrence.

. A bond issue to finance the reservoir passed in July 1977, and bonds were issued and sold at various times throughout the project to finance the construction.

. In many cases, however, courts have also recognized that the date of the taking may occur sometime before the de jure taking. Under a “de facto taking” analysis, the date of the taking is moved forward to reflect the actual taking (or substantial interference with the use and enjoyment of the property) which preceded the formal or legal taking. See generally Julius L. Sackman & Patrick J. Rohan, 4 Nichols’ the Law of Eminent Domain § 12B.17[6] (3d ed. 1978 & 1993 Supp.) [hereinafter Nichols ]. See also infra note 3 (discussing de facto taking analysis).

. I am troubled by the majority's citation to and continued reliance upon Lipson v. Colorado State Dep't of Highways, 41 Colo.App. 568, 569, 588 P.2d 390, 391 (1978). See maj. op. at 178 (stating that for a de facto taking, there must be “a physical entry by the condemnor, a physical ouster of the owner, a legal interference with the physical use, possession or enjoyment of the property or a legal interference with the owner’s power of disposition of the property”) (quoting City of Buffalo v. J.W. Clement Co., 28 N.Y.2d 241, 321 N.Y.S.2d 345, 269 N.E.2d 895 (1971)); see abo maj. op. at 181-182 (citing Lipson); maj. op. at 184 (quoting language from City of Buffalo in Lipson). Moreover, the majority erroneously bases its analysis of the questions of whether the unauthorized drilling or the filing of the Chen report constituted a taking upon Lipson. See maj. op. at 181-182, 184.

In fact, the language cited by the majority does not provide a standard for a taking, but instead states one test that courts use to determine whether a "de facto taking” has occurred. Both Lipson and City of Buffalo specifically addressed de facto taking arguments. However, Grynberg has not asserted that Northglenn’s actions, culminating with the acquisition of the surface estate, constituted a de facto taking, nor does the majority address Grynberg’s claims as a de facto taking.

The de facto taking issue poses difficult legal questions and courts have not uniformly addressed the requirements for a de facto taking. See, e.g., Foster v. City of Detroit, 254 F.Supp. 655 (E.D.Mich.1966) (finding that de facto taking did not require a physical invasion of property), aff’d on other grounds, 405 F.2d 138 (8th Cir.1968); In re Elmwood Park Project Section 1, Group B, 376 Mich. 311, 136 N.W.2d 896 (1965) (same); Conroy-Prugh Glass Co. v. Commonwealth, 456 Pa. 384, 321 A.2d 598 (Pa.1974) (de facto taking occurs when an entity clothed with the power of eminent domain substantially deprives an owner of the use and enjoyment of the property, but does not necessarily require a physical invasion). A de facto taking has also been described as follows:

If the prospective actual execution of a proposed municipal project will deprive the property owner of a beneficial use of his property by substantial impairment of some significant appurtenant right, and, as [a] result of advanced municipal publicity about the project plan and its consequences, the property loses its existent utility and financial viability to the point of subjecting the owner to losing the property, then a de facto taking must be deemed to have occurred.

4. Nichob § 12B.17[6], at 12B-229.

I would not reach the question of the scope or requirements of a de facto taking because this question has not been briefed or argued before this court. However, I note my disagreement with the majority’s decision to equate the Lipson standard for a de facto taking to all taking analysis and the application of the standard to the facts of this case. In my view, the majority’s reliance on the Lipson standard as the basis for its taking analysis, in a case where the de facto taking question has not been raised, is improper and inaccurate.

. Noonan v. Pardee, 200 Pa. 474, 50 A. 255 (1901), explained the duty of subjacent support as follows:

Where there has been a horizontal division of the land, the owner of the subjacent estate, coal or other mineral, owes to the superin-cumbent owner a right of support. This is an absolute right arising out of the ownership of the surface. Good or bad mining in no way affects the responsibility. What the surface owner has a right to demand is sufficient support, even, if to that end, it be necessary to leave every pound of coal untouched under his land.

Noonan, 50 A. at 256. The duty of subjacent support is owed only to the land in its natural condition. 6 American Law of Mining § 203.-02[1], at 203-23 (2d ed. 1992); Roger A. Cunningham, et al., The Law of Property, § 7.4, at 420 (1984).

. Without the right to develop the minerals, there is no purpose to severing the estates. Moreover, if the surface estate cannot be used, in most instances, the minerals cannot be extracted and the mineral estate is worthless.

. In Grynberg 1, we merely held that a geophysical trespass was actionable. Grynberg I, 739 P.2d at 239. The proper claim for the invasion of the property interest and the publication of the information does not lie in inverse condemnation, but rather should be brought in trespass or another action in tort.

In this case, the trial court dismissed Gryn-berg's other claims for relief. Because Gryn-berg did not appeal the dismissal, I would not reach the issue of whether these actions were properly dismissed or are barred by the Governmental Immunity Act, section 24-10-101 to - 120, 10A C.R.S. (1989 & 1992 Supp.).

. I disagree with the majority that the questions of whether the construction of the reservoir either affected the access of the mineral estate owner or made the owner unable to mine the coal are not before us. Maj. op. at 181.

In fact, these questions are central to the determination of whether Northglenn deprived Grynberg of the benefit of his mineral property right and whether Grynberg can assert a constitutional claim for compensation. These questions necessarily must be answered to arrive at a conclusion that "Grynberg was not prevented from exploring or mining coal lying under the proposed site of the reservoir.” Id.

. Moreover, I disagree with the majority’s conclusion that a diminution in value can never support a constitutional claim. In my view, this conclusion cannot be reconciled with the majority’s statement that a "taking occurs when a public entity clothed with the power of eminent domain substantially deprives a property owner of the use and enjoyment of that property.” Maj. op. at 178.

The holder of a mineral estate may have an actionable constitutional damage claim based on a depreciation in market value if the public entity has deprived him of the benefit of his mineral property right. The claim would arise as of the time of the deprivation. For example, a property owner would be entitled to compensation for a diminution in the value of the property based on a material and substantial impairment of the right to access. In my view, an assertion by the holder of a mineral estate that he was unable to mine his estate in the most reasonable, lowest-risk, and most cost effective method because of the actions of the public entity would constitute an actionable constitutional claim, because it would substantially deprive him of the use and enjoyment of that property.

.However, I note my concern with the majority’s analysis of the question of whether there was an unconstitutional "damage.” Specifically, I disagree with any implication that some physical improvement or change of character of abutting or neighboring property is a prerequisite to recovery for an unconstitutional "damage.” Maj. op. at 185 (citing Denver Circle R.R. Co. v. Nestor, 10 Colo. 403, 15 P. 714 (1887)).

I agree that the owner must show a unique or special injury that is different in kind from or not common to the general public to recover in a "damage” case. Radinsky v. City & County of *189Denver, 159 Colo. 134, 138, 410 P.2d 644, 646 (1966). However, there is no absolute prerequisite of "some physical improvement or change of character” to establish an unconstitutional "damage.”

In my view, if Northglenn had deprived Gryn-berg of his right of access to the surface estate, Grynberg would have been able to establish a claim for an unconstitutional "damage.” In such a case, Grynberg would clearly suffer a unique or special injury (the deprivation of his right of access), despite the lack of physical improvement or change of character in the surface estate.