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Clark County v. HQ Metro, LLC

Supreme Court of Nevada

August 2, 2018

CLARK COUNTY, A POLITICAL SUBDIVISION OF THE STATE OF NEVADA, Appellant,
v.
HQ METRO, LLC, AN ARIZONA LIMITED LIABILITY COMPANY; PROJECT ALTA, LLC, A NEVADA LIMITED LIABILITY COMPANY; PROJECT ALTA II, LLC, A NEVADA LIMITED LIABILITY COMPANY; PROJECT ALTA III, LLC, A NEVADA LIMITED LIABILITY COMPANY; AND PROJECT ALTA LIQUIDATING TRUST U/A/D 12/31/09, BY AND THROUGH MARK L. FINE & ASSOCIATES, A NEVADA CORPORATION, INDIVIDUALLY AND AS TRUSTEE, Respondents.

          Appeal from a final judgment in an action for eminent domain. Eighth Judicial District Court, Clark County; Ronald J. Israel, Judge. Affirmed,

          Steven B. Wolfson, District Attorney, and Leslie A. Nielsen and Laura C. Rehfeldt, Deputy District Attorneys, Clark County, for Appellant.

          Law Offices of Brian C. Padgett and Amy L. Sugden, Brian C. Padgett, and Jeremy B. Duke, Las Vegas, for Respondents.

         BEFORE THE COURT EN BANC.[1]

          OPINION

          Cherry J.

         This appeal challenges a district court order apportioning just compensation proceeds in an action for eminent domain. Nevada Power Company, d/b/a Nevada Energy (NV Energy), filed a complaint in eminent domain to obtain an easement for the installation of electrical transmission lines on property owned by respondent HQ Metro, LLC, and leased to appellant Clark County. In October 2013, the district court entered an order allowing NV Energy to occupy the easement area and construct the transmission lines. Before NV Energy physically entered the property to begin construction, however, HQ Metro sold the property to Clark County. The district court concluded that HQ Metro was entitled to compensation for the permanent easement because it was the owner at the time of the order granting occupancy, and the court apportioned the proceeds accordingly. On appeal, HQ Metro and Clark County dispute which one is entitled to compensation for the permanent easement.

         We conclude that the right to compensation vested when the district court entered the order granting immediate occupancy in October 2013, which permitted NV Energy to permanently occupy the easement area and to construct and maintain the transmission lines. Thus, the district court properly concluded that HQ Metro, as the property's owner at the time of the taking, was entitled to compensation for the permanent easement.

          FACTS AND PROCEDURAL HISTORY

         In May 2013, NV Energy filed a complaint in eminent domain to acquire certain easements to construct, operate, and maintain electrical transmission lines on property located at 400 S. Martin Luther King Boulevard in Las Vegas, Nevada. NV Energy sought both a temporary construction easement of 36, 863 square feet and a permanent easement of 16, 861 square feet for the transmission lines across the property. HQ Metro was named in the complaint as the property's record owner. The complaint also named Clark County as a tenant based on a recorded memorandum of lease and purchase option with four Project Alta entities.[2] The lease provided for the development and 30-year lease of office space and a parking garage on the property to Clark County for sublease to the Las Vegas Metropolitan Police Department (LVMPD). The lease also gave Clark County the option to purchase the property three years after LVMPD commenced operations on the property.

         After filing the complaint, NV Energy moved for immediate occupancy under NRS 37.100. Negotiations ensued and the parties entered into a stipulation and order for immediate occupancy, conditioned on NV Energy depositing $281, 000 with the district court. The stipulation provided that NV Energy was acquiring the easements for public use and authorized NV Energy to immediately occupy both the temporary and permanent easement areas for the purposes of permitting, construction, operation, and maintenance of the transmission lines and associated facilities on the property. The stipulation further restrained and enjoined HQ Metro from interfering with NV Energy's occupancy and performance of the work required for the easements. On October 15, 2013, the district court filed an order granting immediate occupancy pursuant to the stipulation's terms. Shortly thereafter, NV Energy deposited the sum with the court, and the order granting immediate occupancy was recorded against the property.

         About a year after the order granting immediate occupancy was entered, but before NV Energy began construction on the project, HQ Metro sold the property to Clark County for $205 million. The September 2014 purchase and sale agreement transferred from HQ Metro to Clark County the real property together with "any and all of [HQ Metro's] rights, easements, licenses and privileges presently thereon or appertaining thereto." Attached to the agreement was a list of title exceptions that included the order granting occupancy, but the agreement did not mention the compensation from the condemnation case or who was entitled to it. The grant, bargain, and sale deed, recorded in October 2014, conveyed title to Clark County subject to an attached list of exceptions, which also included the order granting occupancy to NV Energy.

         In January 2015, NV Energy entered the property to begin construction of its facilities. Construction of the transmission lines was completed four months later in May 2015.

         HQ Metro and Clark County each moved for summary judgment and claimed entitlement to the just compensation proceeds. HQ Metro argued that it was entitled to the proceeds as the landowner at the time NV Energy obtained the order granting immediate occupancy on October 15, 2013. Conversely, Clark County asserted that the right to compensation did not vest until NV Energy physically entered the property to install the transmission lines in January 2015.

         The district court entered a summary judgment order determining that HQ Metro was entitled to damages for the permanent easement because it owned the property when the permanent construction easement was granted in October 2013. The court also determined that LVMPD was entitled to damages under the temporary construction easement. Thereafter, the parties reached a global settlement for the total amount of $850, 000 as compensation due for both the temporary and permanent easements. Consistent with its ...


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