Real Property
| Publication year | 2014 |
Real Property
Linda S. Finley
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Any survey of Real Property Law1 will certainly include a report of the "usual suspects" including boundaries, easements, zoning, and the like, but today's real estate practitioner is expected to be knowledgeable about other related topics such as the unauthorized practice of law, taxation, the rights of consumers in foreclosure, and other varied topics. No survey can discuss every relevant case or topic, but the purpose here is to provide the reader with a broad understanding of "hot" topics and, perhaps, lead the reader to more specific research and debate about these topics.
"At midnight on Thursday, March 20th , [2014,] the 152nd Georgia General Assembly completed one of the fastest legislative sessions in over two decades."2 Even though "the second year of the biennial
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legislative term was an expedited affair due to the upcoming primary elections scheduled for May 20, [2014]," the last few days of the session were filled with the usual late nights as legislators pushed to secure passage of their bills before midnight.3 Perhaps legislation regarding real property was overshadowed by proposed legislation regarding medicinal marijuana,4 expansion of Medicaid coverage to comply with the federal Affordable Care Act,5 and the regulation of smartphone-based car service providers such as Uber and Lyft.6 However, a few changes bear discussion.
The General Assembly enacted House Bill 954,7 which changed the definition of "fair market value" as it relates to ad valorem taxation.8 The bill amended section 48-5-2(3)(B) of the Official Code of Georgia Annotated (O.C.G.A.)9 relating to definitions applied to ad valorem tax.10 Specifically, the bill added criteria for the tax assessor to apply in determining the fair market value of real property subject to regulations of the Department of Housing and Urban Development (Section 8 Housing) or Georgia housing programs and included analysis of the following:
Rent limitations, operational requirements, and any other restrictions imposed upon the property in connection with the property being eligible for any income tax credits . . . or receiving any other state or federal subsidies provided with respect to the use of the property as residential rental property, provided . . . that such properties . . . shall not be considered comparable real property for assessment or appeal of assessment of other properties.11
The governor signed the bill on April 29, 2014, and it became effective as law on July 1, 2014.12
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House Bill 750,13 signed by the governor and effective on April 21, 2014,14 created an exemption to the mortgage broker licensing requirement for employees of non-profit entities.15 The purpose of the exemption is to allow employees of non-profit entities to negotiate favorable mortgage terms for homeowners facing financial distress within the confines of their employment with the non-profit organization.16
Senate Bill 12517 was enacted to codify (and limit) the duty against harm owed by owners of land to trespassers.18 In fact, the Georgia Chamber of Commerce labeled the legislation as "an essential tool to protect property owners from unfair and unwarranted litigation brought by criminals."19 Specifically, the statute provides that a lawful possessor of land, meaning the "landowner, occupant of the land, holder of any easement to the land, or lessee of the land . . . owes no duty of care to a trespasser except to refrain from causing a willful or wanton injury."20 The revision preserves the common law doctrine of attractive nuisance in Georgia.21 The bill was signed into law by the governor and became effective July 1, 2014.22
The Flint River Drought Protection Act23 was amended to better protect water resources in Georgia, particularly southwest Georgia, during drought conditions.24 The bill increases conservation standards for farm irrigation and clarifies the Environmental Protection Division (EPD)'s authorization to augment stream flow in the Flint River basin when necessary during times of drought.25 If severe drought is predicted during any particular year or drought conditions are declared, the EPD may limit the amount of land serviced by irrigation systems to
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maintain an acceptable stream flow in the Mint River.26 The amendment also provides a means to create water conservancy pilot projects and programs for the use of surface and ground water and set minimum levels for irrigation-system efficiencies.27
In Bray v. Department of Transportation,29 a portion of Bray's property was taken by the Georgia Department of Transportation (the Department) for the construction of a road, resulting in a suit by Bray for inverse condemnation and damages caused by the Department's alleged negligent construction of improvements. The trial court dismissed Bray's claim for two reasons.30
First, the trial court found that Bray had failed to comply with the ante litem notice provisions set forth in O.C.G.A. § 50-21-2631 that require notice be given as a prerequisite to a tort claim against the state. Second, the trial court dismissed the claim because it found the action asserted professional negligence, and Bray failed to comply with O.C.G.A. § 9-11-9.1,32 which requires the filing of an expert affidavit with the complaint.33
The Georgia Court of Appeals first noted that an earlier condemnation award was only "conclusive as to all damages to the remaining property, foreseen or not, resulting from proper construction of the road improvements."34 Furthermore, damage to remaining property caused by negligent or improper construction may be recovered in a separate inverse-condemnation claim because the condemnor has a constitutional duty to pay damages for the taking or damaging of land.35 This constitutional duty cannot be excused even if the condemnor claims the negligence of an independent contractor caused the damage.36
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The court held that the trial court erred by dismissing the inverse-condemnation claim on the grounds that Bray failed to give notice to the Department as the Georgia Tort Claims Act (GTCA)37 requires.38 In so holding, the court reasoned that "[n]o sovereign immunity exists where a cause of action for inverse condemnation lies, because the Constitution itself affords the right" to bring the claim, and the GTCA does not apply.39
The court then considered the dismissal for failure to include an expert affidavit.40 Holding that O.C.G.A. § 9-11-9.1 applies—but construing the complaint liberally—the court concluded that the claim was based on both professional negligence and other negligence.41 Accordingly, the court remanded the case for a determination on the merits of the related claims that were not controlled by O.C.G.A. § 9-11-9.1.42
In Emery v. Chattooga County,43 the property owner, Emery, brought an appeal after the trial court denied his petition to set aside a declaration of taking for condemnation of real property filed by Chattooga County, Georgia (the County). Emery filed the petition to set aside the declaration of taking because he was the only holdout after all his neighbors voluntarily conveyed their interests in land so their neighborhood road could become part of the county road system. As part of the County road system, the road would be paved and maintained by the County.44
Emery claimed the County abused or misused its power because his private property was taken and condemned for the benefit of a few private citizens, and the exercise was not "reasonably related to the development, growth, or enhancement of the public roads of Georgia."45 The court of appeals acknowledged that "[t]he condemnor is not authorized to exercise the power of eminent domain to acquire property to be used by private individuals for private use and private gain."46
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However, the court found this road would be a public road even though the general public would not frequently travel it and the primary users of the road would be limited to the twenty residents who lived along the road.47 In its holding, the court cited the precedent that "[i]f the public [has] a right and but one person uses the [road], the purpose is deemed to be public."48 That situation is distinct from one in which the public is generally excluded and "the use of the [road] is limited to that of an individual enterprise."49
The court also reviewed factors that demonstrated the intent of the County.50 Those factors indicated there was no bad faith on the part of the County when it exercised the power of eminent domain.51 Three contributing factors were considered.52 First, the court noted that the local fire chief approached the County about acquiring the road after the fire department responded to a fire in the area.53 Second, the court considered the existence of a County policy "to acquire, improve and maintain roads as parts of the county were developed."54 Third, the court weighed the request by the other residents that the County apply the policy to their road.55
In ADC Investments, LLC v. Department of Transportation,56 ADC Investments, LLC (ADC) sought to introduce evidence at trial concerning an anticipated income stream from a changeable digital billboard that likely would have been erected on the property rather than the static billboard that actually existed on the property. This appeal resulted when the trial court granted partial summary judgment to the Department.57 The trial court's ruling served to limit ADC's damages to "the value of the property as it existed on the date of the taking, i.e., with a static billboard."58
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The Department condemned a twenty-five square-foot parcel of property located near the intersection of Highway 316 and State Route 20 in Lawrenceville, Georgia (the City).59 The court of appeals noted that "[t]he only improvement on the property on...
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