City of Benton v. Alcoa Road Storage, Inc.

Josephine Linker Hart, Justice,

dissenting.

The majority has failed to properly apply statutory construction in accordance with the time-honored methods that this court has hitherto employed. The proper application of our procedures for interpreting an act of the General Assembly, when done in a manner that comports with our state constitution, mandates that both attorney’s fees and expert-witness fees are “costs occasioned by the assessment” of just compensation for property condemned under eminent domain. Ark. Code Ann. § 18-15-307(c).1 Thus, Alcoa Road Storage, Inc. (Alcoa) is entitled to not only attorney’s fees but its expert-witness fees as well.

The crux of this appeal is the meaning of the word “costs” in the phrase “costs occasioned by the assessment” found in Arkansas Code Annotated section 18-15-307(c). More specifically, the question is whether “costs” may be interpreted to mean the money 10that Alcoa had to expend in litigation to obtain the “just compensation” that a property owner is guaranteed by the Arkansas Constitution.

The Arkansas Constitution, in article 2, section 22 states, “The right of property is before and higher than any constitutional sanction; and private property shall not be taken, appropriated or damaged for public use, without just compensation therefor.” Furthermore, “just compensation” means full compensation. Ark. State Highway Comm’n v. Vick, 284 Ark. 372, 682 S.W.2d 731 (1985). Moreover, this court is obligated to construe an act to be constitutional, if possible. Summerville v. Thrower, 369 Ark. 231, 253 S.W.3d 415 (2007). Had the majority allowed these fundamental principles to illuminate its search for the meaning of “costs” in section 18-15-307(c), it would not have stumbled so badly as to interpret a statute in an unconstitutional manner.

The majority’s citation of Ellis v. Arkansas State Highway Commission, 2010 Ark. 196, 363 S.W.3d 321 and Arkansas State Highway Commission v. Johnson, 300 Ark. 454, 780 S.W.2d 326 (1989) shows the depth of its misunderstanding of my analysis on this point. The proper construction of section 18-15-307(c) must proceed from the presumption that the General Assembly understands the constitutional requirement that a citizen receives just compensation whenever the state takes his or her property. I contend that this constitutional requirement is embodied in section 18-15-307(c) and should be given effect by this court.

Instead, the majority apparently presumes that the General Assembly has disregarded the Arkansas Constitution both directly by denying a landowner just compensation and indirectly by intruding on the landowner’s constitutional right to a trial by jury.

|7To be sure, Alcoa has not placed before this court a challenge to the constitutionality of section 18-15-307(c). Implicit in Alcoa’s argument is that the statute is constitutional. It is only the majority’s interpretation that has made section 18-15-307(c) unconstitutional.

“Costs” is commonly defined as “the expenses of litigation, prosecution, or other legal transaction esp. those allowed in favor of one party against another.” Black’s Law Dictionary 423 (10th ed. 2014). The majority is being disingenuous when it cites Arkansas Department of Human Services v. Kistler, 320 Ark. 501, 898 S.W.2d 32 (1995), for the proposition that when a statute uses the words costs and expenses, the meaning “do[es] not ordinarily include attorney fees.” Kistler holds that attorney’s fees are not awarded without statutory authority. The majority completely misses my point—section 18—15— 307(c) does provide that statutory authority in this case.

That the General Assembly is sensitive to protection of the constitutional right of landowners to full compensation for the taking of their property cannot be doubted. When the General Assembly recently amended another eminent-domain statute, Arkansas Code Annotated section 27-67-317, it effectively overruled the two cases relied on by the majority, Ellis v. Arkansas State Highway Commission, supra and Arkansas State Highway Commission v. Johnson; supra, it stated the following:

AN ACT TO MODIFY CERTAIN EMINENT DOMAIN LAWS THAT ARISE OUT OF PROPERTY RIGHTS SECURED UNDER ARTICLE 2, § 22 OF THE ARKANSAS CONSTITUTION; AND FOR OTHER PURPOSES.
Subtitle
TO MODIFY CERTAIN EMINENT DOMAIN LAWS THAT ARISE OUT OF PROPERTY RIGHTS SECURED UNDER ARTICLE 2, § 22 OF THE ARKANSAS CONSTITUTION.
I «BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF ARKANSAS:
SECTION 1. DO NOT CODIFY. Legislative intent.
(a) It is the intent of the General Assembly to protect the property rights of the people of the State of Arkansas in eminent domain proceedings initiated by the State Highway Commission because, as stated in Article 2, § 22 of the Arkansas Constitution, the right of property in Arkansas is before and higher than any constitutional sanction and should not be taken without just compensation.
(b) The General Assembly believes when the Arkansas State Highway and Transportation Department fails to offer the fair market value for condemned property that costs, expenses, and reasonable attorney’s fees should be awarded to the land owner to justly compensate the people of the State of Arkansas.

Act of Mar. 26, 2013, No. 502, 2013 Ark. Act 502. Section 18-15-307(c) did not need similar attention from our legislature, until now.

Section 18-15-307(c)’s use of the word “costs” is consistent with at least one other statute that concerns the award of attorney’s fees. Arkansas Code Annotated section 16-22-308 provides for the award of attorney’s fees to the prevailing party in a contract action,2 directing that a reasonable attorney’s fee be assessed by the trial court and “collected as costs.” Accordingly, this interpretation would affirm the award of attorney’s fees as part of the “cost” of securing a proper assessment for the condemned property. However, by Uconstruing “costs” in the way that it does, the majority has caused Alcoa to receive for its “just compensation” $31,600.15 less than the jury determined was “just.”

A more rigorous application of the canons of statutory construction further substantiates this analysis. The correct application and interpretation of an Arkansas statute is a question of law, which this court decides de novo. Hammerhead Contracting & Dev., LLC v. Ladd, 2016 Ark. 162, 489 S.W.3d 654. The purpose of the rules of statutory construction is to give effect to the intent of the legislature. Id. The first rule of statutory construction is to construe a statute just as it reads, giving the words their ordinary and usually accepted meaning. Id. Additionally, in construing any statute, we place it beside other statutes relevant to the subject matter in question and ascribe meaning and effect to be derived from the whole. Id. Statutes relating to the same subject must be construed together and in harmony, if possible. Id.

The construction of “costs” to include attorney’s fees and expert-witness fees harmonizes section 18-15-307(c) with the provisions in section 27-67-317(b). This interpretation would provide the same compensation to a landowner who is forced to vindicate his or her right to just compensation through litigation. Otherwise, we are left with the anomaly of the rare instance in which the legislature gives the State of Arkansas, which would otherwise be protected by sovereign immunity, less protection than a municipal corporation.

In short, two interpretations of section 18-15-307(c) are possible. One interpretation justifies the circuit court’s award of attorney’s fees and the expert-witness fees that Alcoa seeks in its cross-appeal, thus giving Alcoa the full compensation that a jury determined was |in“just.” The other interpretation, the one espoused by the majority, leaves Alcoa’s compensation $31,600.15 less than what the jury said Alcoa was entitled to. I refuse to lay at the feet of the General Assembly an interpretation of a statute, made solely by this court, that serves to unconstitutionally deny Alcoa its just compensation for the land taken by the City of Benton. I would affirm the circuit court on the award of attorney’s fees and reverse and remand this case for a consideration of which expert-witness fees and other expenses associated with the litigation were necessary to obtain the jury’s assessment of the “just compensation” in this case. I therefore respectfully dissent.

. The full text of the pertinent part of the statute reads as follows: “The costs occasioned by the assessment shall be paid by the corporation, and, as to the other costs which may arise, they shall be charged or taxed as the court may direct." Ark. Code Ann. § 18— 15-307(c).

. The code section states:

In any civil action to recover on an open account, statement of account, account stated, promissory note, bill, negotiable instrument, or contract relating to the purchase or sale of goods, wares, or merchandise, or for labor or services, or breach of contract, unless otherwise provided by law or the contract which is the subject matter of the action, the prevailing party may be allowed a reasonable attorney’s fee to be assessed by the court and collected as costs.
Ark. Code Ann. § 16-22-308 (Repl. 1999).