Present: ALL THE JUSTICES
RICHMEADE, L.P.
v. Record No. 031513 OPINION BY JUSTICE ELIZABETH B. LACY
April 23, 2004
CITY OF RICHMOND
FROM THE CIRCUIT COURT OF THE CITY OF RICHMOND
Randall G. Johnson, Judge
In this appeal we consider whether this action for inverse
condemnation is subject to the three-year statute of
limitations for an implied contract, Code § 8.01-246, or the
five-year limitations period for injury to property, Code
§ 8.01-243.
Richmeade, L.P., owns approximately 25 acres of land in
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the City of Richmond, known as the Windsor Apartment Complex.
On February 17, 1997, Richmeade acquired an option to purchase
real property located next to the Windsor Apartment Complex.
In order to develop the two parcels as a single apartment
development, Richmeade requested that the City vacate certain
streets within the proposed development. By ordinance adopted
February 22, 1999, the City vacated the streets pursuant to
Code §§ 15.2-2006 and 15.2-2007.1. In April 1999, the City
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The trial court decided the case without an evidentiary
hearing on the City of Richmond's special plea to the statute
of limitations. For purposes of this appeal, we recite the
facts as alleged in the motion for declaratory judgment. While
the City filed a demurrer asserting that the property was never
taken or damaged, the facts relevant to this appeal are not in
dispute.
reconsidered its February 22, 1999 action and denied the
request for vacating the streets.
On September 10, 2002, Richmeade filed an inverse
condemnation action pursuant to the declaratory judgment
statute, Code § 8.01-184 et seq., seeking a declaration that
the City's actions constituted a "taking and/or damaging" of
its property and property rights and a trial by jury "on the
issue of taking and damaging of property rights and of just
compensation." The City filed a plea of the statute of
limitations asserting that Richmeade's action was time-barred
because it was not filed within the three-year limitations
period established for implied contracts by Code § 8.01-246.
Richmeade argued that its action was an action for "damage to
property" and therefore was subject to the five-year
limitations period in Code § 8.01-243. Following briefing and
argument of counsel, the trial court, relying on Prendergast v.
Northern Virginia Regional Park Authority, 227 Va. 190, 313
S.E.2d 399 (1984), concluded that an action for inverse
condemnation was subject to the three-year statute of
limitations and entered an order dismissing Richmeade's motion
for judgment.
DISCUSSION
Article I, Section 11 of the Constitution of Virginia
confers on a property owner a right to just compensation from
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the government when the government takes or damages the owner's
property for public use. Va. Const. art. I, § 11; State Hwy. &
Transp. Comm'r v. Linsly, 223 Va. 437, 443, 490, 290 S.E.2d
834, 838 (1982); C. & O. Ry. Co. v. Ricks, 146 Va. 10, 18, 135
S.E. 685, 688 (1926). As early as 1919, this Court held that a
landowner could enforce this right under a tort or contract
theory of recovery; however, because the sovereign was not
liable for injuries based on negligence, a landowner could
waive recovery under the tort theory and sue on the contract
between the landowner and the government that Article I,
Section 11 implies. Nelson County v. Loving, 126 Va. 283, 299-
300, 101 S.E. 406, 411 (1919). Since 1919, this Court has
consistently held that when the government failed to condemn
private land taken for public purposes, the landowner's
recourse was to file an action for inverse condemnation based
on the implied contract between the government and the
landowner. The terms of that implied contract require the
government to pay the landowner "such amount as would have been
awarded therefor, if the property had been condemned under the
eminent domain statutes." Nelson County v. Coleman, 126 Va.
275, 279, 101 S.E. 413, 414 (1919); Burns v. Bd. of
Supervisors, 218 Va. 625, 627, 238 S.E.2d 823, 825 (1977).
In Prendergast, the case relied upon by the trial court,
water from restoration work conducted by the Park Authority
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leaked into the lower level of a building on an adjacent lot.
The owner of the building filed a five-count motion for
judgment against the Authority. In Count 5 of the motion for
judgment, the building owner initially alleged that the
government took or damaged his property "without due process of
law and without payment of just compensation." Prendergast,
227 Va. at 192, 313 S.E.2d at 400. In repleading that Count,
the building owner realleged a taking of property without due
process and just compensation and asked that the trial court
direct the Authority to file condemnation proceedings for the
purpose of ascertaining the amount of just compensation due for
the damaged building. Id. at 192-93; 313 S.E.2d at 400.
The building owner argued that Count 5 was subject to the
five-year limitations period of Code § 8.01-243(B)(injury to
property), while the Authority asserted that the three-year
limitations period for implied contracts under Code § 8.01-
246(4) applied. In concluding that the three-year period
applied, this Court held that Count 5 "sounded in inverse
condemnation," that inverse condemnation is based on an implied
contract, and that "[o]nce the trial court correctly concluded
that the essence of Count 5 was an action based on an implied
contract it follows that application of the period of
limitations contained in Code § 8.01-246(4) was proper."
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Prendergast, 227 Va. at 195, 313 S.E.2d at 402 (citing Burns,
218 Va. at 627, 238 S.E.2d at 825).
The facts of this case are indistinguishable from those in
Prendergast. Here there is no dispute that Richmeade's action
is an "action for inverse condemnation" seeking an "award of
damages for the condemnation of Plaintiffs' property and/or
property rights." As we explained in Burns, an inverse
condemnation action is based on an implied contract that the
government will justly compensate landowners for land it has
taken. 218 Va. at 627, 238 S.E.2d at 825. Therefore, the
cause of action is subject to the three-year limitations period
of Code § 8.01-246(4). Prendergast, 227 Va. at 195, 313 S.E.2d
at 404.
Richmeade asserts, however, that the decision in
Prendergast is incompatible with the principle that the object
of the litigation and not its form determines the applicability
of a statute of limitations.2 Friedman v. Peoples Serv. Drug
Stores, 208 Va. 700, 703, 160 S.E.2d 563, 565 (1968);
Birmingham v. Chesapeake & Ohio Ry. Co., 98 Va. 548, 551, 37
2
Richmeade also cites Hampton Roads Sanitation District v.
McDonnell, 234 Va. 235, 360 S.E.2d 841 (1987), in support of
its position because the five-year limitations period was
applied to an inverse condemnation count in that case. Both
Richmeade and the City acknowledge, however, that unlike
Prendergast, the proper limitations period was not at issue in
McDonnell, and for that reason McDonnell does not control or
affect the result in this case.
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S.E. 17, 17 (1900). According to Richmeade, if this principle
is applied to an inverse condemnation case, the correct statute
of limitations is the five-year limitations period of Code
§ 8.01-243(B) because the object of every inverse condemnation
action is to recover for injury to property. We disagree.
The object of an inverse condemnation action, according to
Richmeade, is to recover compensation for damage to private
property. But an inverse condemnation action is a specific
type of proceeding based on a constitutionally created right
connected to the "taking" or "damaging" of property by the
government. To take or damage property in the constitutional
sense does not require that the sovereign actually invade or
disturb the property. Taking or damaging property in the
constitutional sense means that the governmental action
adversely affects the landowner's ability to exercise a right
connected to the property. Prince William County v. Omni
Homes, 253 Va. 59, 72, 481 S.E.2d 460, 467 (1997); City of
Lynchburg v. Peters, 156 Va. 40, 48-49, 157 S.E. 769, 772
(1931); Lambert v. City of Norfolk, 108 Va. 259, 265, 61 S.E.
776, 778 (1908). Thus, an action for inverse condemnation is
an action seeking redress for the government's action in
limiting property rights the landowner holds. In that regard,
the act giving rise to the breach of implied contract is not an
act aimed at the property, but rather an act that limits the
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landowner's ability to exercise his property rights without
paying the landowner for that limitation. The mere fact that
the measurement of that compensation may be based on a decline
in the value of the subject property does not make the action
one for injury to property.
This conclusion is consistent with the result we reached
in Pigott v. Moran, 231 Va. 76, 341 S.E.2d 179 (1986), where
the issue was whether an action for constructive fraud was an
action for "injury to property" subject to the five-year
limitations period of Code § 8.01-243(B) or a "personal action"
subject to the shorter limitations period then provided for by
Code § 8.01-248. In that case, purchasers of a house sued
their real estate agent for fraud, maintaining that the agent
misrepresented to them that the property abutting the property
they eventually purchased was zoned for residential purposes
when in fact the property was zoned for commercial and
industrial purposes. The purchasers identified their damage
claim as a financial loss based on the difference between the
value of the land if it abutted residential property and the
actual value of the land abutting commercial and industrial
property. Id. at 78-79, 341 S.E.2d at 180-81. The purchasers
argued that even though they had filed an action for
constructive fraud, the five-year limitations period of Code
§ 8.01-243(B) applied because the action was an "action for
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injury to property." We rejected the purchaser's position,
finding that the "gist" of the purchasers' claim was that the
wrongful act was aimed at the purchasers "personally and not
their property" even though the damages claimed involved a
decrease − or injury − to the property's value. Id. at 81, 341
S.E.2d at 182.
The gist of Richmeade's claim in this case is that the
wrongful act of the government was aimed at Richmeade and not
at the property. The government's wrongful act in this case
was the failure of the City of Richmond to pay Richmeade for
the limitations the City placed on Richmeade's ability to
exercise its rights over its property. Thus, as in Pigott, the
object of this action is not injury to property. It is the
injury suffered by Richmeade because the City breached its
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implied contract to pay just compensation.
Accordingly, we conclude that the trial court did not err
in applying the three-year limitations period of Code § 8.01-
246(4) to this inverse compensation action and we will affirm
the judgment of the trial court.
Affirmed.
JUSTICE KOONTZ and JUSTICE LEMONS dissent.
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We also note that this result is consistent with the
Revisers' Note to the 1977 revision of Title 8.01 explaining
that the five-year limitations period for injury to property
does not apply to actions resulting from a breach of contract.
See Revisers' Note, Code § 8.01-243.
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