South Carolina              
Administrative Law Court
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SC Administrative Law Court Decisions

CAPTION:
Daryl and Kay Vaughn, d/b/a Tri-Star Auto Sales vs. DOT

AGENCY:
South Carolina Department of Transportation

PARTIES:
Petitioners:
Daryl and Kay Vaughn, d/b/a Tri-Star Auto Sales

Respondent:
South Carolina Department of Transportation
 
DOCKET NUMBER:
02-ALJ-19-0178-CC

APPEARANCES:
Samantha P. Nelson, Esquire, for the Petitioners

Deborah Brooks Durden, Esquire, for the Respondent
 

ORDERS:

FINAL ORDER AND DECISION

STATEMENT OF THE CASE

This matter comes before the Administrative Law Judge Division (Division) pursuant to S.C. Code Ann. § 28‑11‑10 (1991 & Supp. 2000), upon the Petitioner’s request for a hearing to review a decision of the Respondent South Carolina Department of Transportation (Department) denying relocation payments to the Petitioner. A contested case hearing on the merits was held at the offices of the Division on June 4, 2003.

FINDINGS OF FACTS

Having observed the witnesses and exhibits presented at the hearing and closely passed upon their credibility, taking into consideration the burden of persuasion by the parties, I make the following findings of fact by a preponderance of the evidence:

1. Notice of the date, time, place, and nature of the hearing was timely given to all parties.


2. The Petitioners signed a two-year lease in May of 1997 with Pilgrim-Moore Properties for the use of property at 7405 Highway 81 South, Starr, South Carolina (The Property). The Property had most of its frontage on Highway 81. The Petitioners began operating a business on the Property known as “Tri-Star Auto Sales” (Tri-Star) on or about July 1, 1997. The business consisted of the sale of used cars. The Petitioners chose this location, in part, because of the amount of vehicular traffic that flowed past the location and the view of their inventory the Property provided from Highway 81. Prior to the opening of the business, the Petitioners improved the Property by clearing some of it of trees with a bulldozer, clearing underbrush, stripping the topsoil, grading the Property, hauling in gravel, and installing a small building with a deck and utilities. As of early 1998, the Petitioners had an inventory of approximately fifty (50) to sixty (60) cars.

The Respondent determined that Highway 81 in Anderson County needed to be rerouted to make the highway safer. The rerouted highway was to cross the Tri-Star Property over the area where the building and utilities were placed and over much of Tri-Star’s lot. Consequently, the Petitioners moved the building and utilities and the contractor continued the highway project over the Property. The construction contractor subsequently gave the Petitioners One Thousand ($1,000.00) Dollars for the cost of moving the building and the Petitioners signed an Agreement releasing the contractor from any further responsibility regarding moving the Petitioners’ property.

After the highway project was finished in approximately October of 2000, the Petitioners’ Property was located on a dead-end side street off of Highway 81 rather than the main artery. Consequently, the Petitioners moved their lot so that the cars could be viewed from the new Highway 81. Nevertheless, the new roadway on Highway 81 was graded much higher than the original location of the Property. As a result, only the tops of the vehicles could be seen from Highway 81 and thus the Petitioners’ inventory was practically no longer visible to the vehicular traffic on the new Highway 81. The Petitioners attempted to continue to operate their business upon the Property from January of 2001 through March of 2001. However, the ensuing business was very slow. When it had become apparent that the location was not profitable because the height of the highway inhibited potential customers from seeing their inventory and thereby impairing car sales, the Petitioners made the decision to move.

In April of 2001, the Petitioners leased another property located several miles away and moved their business. Though all operations at the Property were ended on or about April 30, 2001, the Petitioners discussed possibly returning to the Property if certain improvements were made to the Property. In particular, the Petitioners discussed returning if the entire Property was raised to be level with the new highway. This was eventually done by Pilgrim-Moore Properties.


3. The Petitioners incurred $2,130.00 in expenses to move their business off of the Property in April of 2001. These expenses included $1,200.00 to move approximately sixty (60) vehicles at an average of $20.00 per vehicle; $375.00 to move the “Tri-Star Auto Sales” sign and install it at the new location; $270.00 to pay for three (3) people $15.00 per hour for six (6) hours to move all items of personal property from the Property to the new location; $100.00 in advertising expenses for printed cards, postage and a radio announcement; and $185.00 for a new business license, a new dealer’s license, a change of address for the bond, and the three (3) new plates.[1]

4. On August 13, 1999, the Department filed a Condemnation Notice and Tender of Payment against the landowner, Pilgrim-Moore Properties, in the Anderson County Court of Common Pleas in Civil Action Number 1999-CP-04-1737 and against the Petitioners in Civil Action Number 1999-CP-04-1738. These two actions were resolved by Consent Order of Dismissal signed on January 29, 2001. The Petitioners were later dismissed from those actions without prejudice. The Court Order stated that the Petitioners were not entitled to any of the proceeds from those actions and that the Petitioners were entitled to pursue their rights under Section 28-11-10.

CONCLUSIONS OF LAW

Based upon the above Findings of Fact, I conclude the following as a matter of law:

1. This Division has subject matter jurisdiction in this case pursuant to S.C. Code Ann. § 1-23-600(B) (1986 & Supp. 2000) and 25A S.C. Code Ann. Regs. 63-322 (D) (Supp. 2000).

2. The Petitioners contend that they are “displaced persons” under 42 U.S.C.A. § 4601 since they had to relocate their business as a direct result of the Respondent’s project. The Petitioners further contend that as displaced persons they are entitled to Relocation Assistance Benefits pursuant to 42 U.S.C.A. §4622 for expenses incurred from this relocation. The Respondent, on the other hand, argues that the Petitioners are not “displaced persons” under 42 U.S.C.A. § 4601 and thus they are not entitled to any benefits pursuant to Section 4622.


S.C. Code Ann. §28-11-10 (1991 & Supp. 2000) sets forth that:

To the extent that the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (Public Law 91‑646) makes relocation payments and assistance to displaced persons or other legal entities by states a prerequisite to Federal aid [the Department is] . . . empowered to expend available public funds for such purposes and are required to make such payments to such displaced persons or other legal entities, whether the program or project is federally aided or not, and such expenditures shall be deemed part of the cost of such program or project.

42 U.S.C.A. §§ 4622 & 4601 govern the amount of compensation and qualifications for entitlement to benefits under Section 28-11-10. Section 4601 (6)(A)(i) provides that a “displaced person” means a person who moves from real property “as a direct result” of the Department’s intent to acquire the property in whole or in part for a project undertaken with federal financial assistance or a small business which as a direct result of such activity is permanently displaced. 49 C.F.R. 24.2 (iv) & (vi) further provides that a displaced person does not include: “A person who is not required to relocate permanently as a direct result of the project [or a] person whom the Agency determines is not displaced as a direct result of a partial acquisition”

Here, the Petitioners leased property which was partially acquired for a public highway project utilizing federal funds. After the highway project was completed, the old roadway which fronted the Petitioners’ Property was no longer the main artery. The Petitioners then re-oriented their business to the new roadway. However, their inventory was practically no longer viewable to the vehicular traffic on the new Highway 81. The Petitioners could have remained on the site. Nevertheless, the Petitioners were leasing the Property to manage a business selling used cars. The viability of that business which was dependent upon observation of the lot by vehicular traffic was destroyed as a direct result of the rerouting of Highway 81. Therefore, the Property was no longer functional for conducting business. Once the Property lost its utility as a location to sell used cars, the Petitioners were forced to either relocate their business or cease to operate. Consequently, the viability of the Petitioners’ used car business was destroyed as a direct result of the rerouting of Highway 81. Accordingly, I find that the Petitioners were displaced as a direct result of the construction of the new roadway.


Moreover, though the Petitioners discussed returning to the site, the Property had to be “built up” to make the business profitable. After they left the site, the Petitioners had no assurances that the landowner would again lease the Property to them or that the Property would be suitable for their needs. Since the Petitioners’ return was speculative, I further find that their displacement was permanent. Therefore, I find that the Petitioners are “displaced” under 42 U.S.C.A. § 4601(6)(A)(i).

3. The Respondent further contends that since the Petitioners withdrew from the condemnation action that they are precluded from bringing this action for Relocation Assistance Benefits. A condemnation action was filed in this case against the Property owner and the Petitioners. The condemnation settlement ultimately paid the Property owner to build the Property up. However, the Petitioners were released from the condemnation action without prejudice to pursue a claim for moving expenses. Though the Petitioners did voluntarily withdraw from the condemnation action, their decision was not a unilateral decision. In fact, the Consent Order specifically declared that the Petitioners had “agreed” to pursue their rights for Relocation Assistance Benefits under Section 28-11-10. An agreement under these circumstances implies an understanding between the disputing parties - not simply the Petitioners - that the Petitioners could pursue their claim under Section 28-11-10. This properly executed agreement is binding upon the Department. See Townes Assocs., Ltd. v. City of Greenville, 266 S.C. 81, 221 S.E. 2d 773 (1976). Therefore, I do not find that the Petitioners are precluded by any means from pursuing this action as a result of their withdrawal from the condemnation action. In particular, I find that the Respondent is estopped from seeking to preclude the Petitioners from pursuing this action before the Administrative Law Judge Division.

4. 42 U.S.C.A. § 4622 (a) provides: “Whenever a program or project to be undertaken by a displacing agency will result in the displacement of any person, the head of the displacing agency shall provide for the payment to the displaced person of [the] . . . (4) actual reasonable expenses necessary to reestablish a . . . small business at its new site, but not to exceed $10,000.” The evidence established that the Petitioners incurred $2,130.00 in moving expenses to relocate their business from the Property to the new site. Therefore, the Petitioners are entitled to reimbursement of those moving expenses.


ORDER

Based upon the foregoing finding of facts and conclusions of law,

IT IS HEREBY ORDERED that the Department shall pay to the Petitioners the sum of Two Thousand One Hundred and Thirty ($2,130.00) Dollars.

AND IT IS SO ORDERED.

___________________________________

Ralph King Anderson, III

Administrative Law Judge

September 11, 2003

Columbia, South Carolina



[1] The Petitioners also sought reimbursement for the 400 tons of gravel they had placed upon the Property over the entire time that they had used the Property. At a cost $14.00 per ton, that total reimbursement cost was $5,600.00. However, those costs were incurred to develop the Property after signing a lease. That lease had subsequently expired and the Petitioners were renting the Property “month-to-month.” Therefore, I find that the gravel costs were not related to the Petitioners’ relocation from the Property.


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