Here's the latest in a case we posted about last year. There, the North Dakota Supreme Court noted an open issue, but declined to resolve it. Now, in Fargo v. Wieland, No. 20200100 (July 22, 2020), the court addressed it head-on.
Here's how the noted the issue:
whether a landowner who appeals an award in eminent domain proceedings, without accepting or withdrawing deposited funds, is entitled to the payment of post-judgment interest subsequent to the deposit of the full amount of the judgment
Slip op. at 2.
After a just comp judgment, the city deposited the funds to cover the verdict, plus money for the court's award of attorneys' fees. The property owner appealed. Even though she could have, she didn't withdraw the money because doing so would have waived her right to appeal on all issues except a claim for more compensation. Her appeal asserted the taking was invalid, so pulling the money would have waived the argument.
After losing the appeal, the owner argued she was entitled to interest on the deposit. The city asserted that no interest could run because the owner could have pulled the funds, but didn't. The owner countered that this would force her into choosing between her right to appeal, and her right to the funds.
The court agreed with the city, noting that the operative statute (N.D. Civ. Code § 32-15-29) does not permit interest to accrue on deposits that cover the entire amount of a judgment. "While we agree with Wieland that the statute appears to require unsatisfied landowners to make a difficult choice between withdrawing the deposit and limiting their appeal to a claim for greater compensation, or foregoing the use of the funds and preserving all of their potential issues on appeal, there is nothing in the statute suggesting the legislature intended something different." Slip op. at 5. The majority noted that the owner did not challenge the constitutionality of the statute.
One Justice dissented, noting that this is a matter of just compensation under the constitution, not statutory grace. It's not really "interest," but "such additional amount beyond the value of the property or the amount of the damage to the property as of the time of the taking or damaging as may be necessary to award the full equivalent of the value or the damage, as the case may be[.]" Slip op. at 9 (Crothers, J., dissenting).
Since the statute requires the depositor to "keep said fund full and without diminution," this includes interest (or the time value of money, whatever you might want to call it), at least in the dissenting Justice's view.
Under the majority’s interpretation of N.D.C.C. § 32-15-29 and N.D.C.C. § 32-15-30, Fargo can simply dump more than $900,000 on the clerk of court’s counter and walk away. Under the majority’s interpretation of the statutes, Fargo has no responsibility for how the funds are handled subsequently. I cannot agree with those results. If the words “keep said fund full” and “without diminution” in N.D.C.C. § 32-15-30 have any meaning, those words require that Fargo ensure interest accrues on the money that it remains responsible for paying Wieland. In order for Wieland to receive just compensation as required by both the North Dakota and the United States Constitutions, I also read N.D.C.C. § 32-15-30 as imposing on Fargo the risk that (and, hence, liability for) the deposited funds will fully pay Wieland just compensation when Wieland is legally entitled to withdraw the funds.
Slip op. at 12-12 (Crothers, J., dissenting).
Fargo v. Wieland, No. 20200100 (N.D. July 22, 2020)
