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Forest Lakes Community Association, Inc. v. United Land Corporation of America

Supreme Court of Virginia

February 16, 2017

FOREST LAKES COMMUNITY ASSOCIATION, INC., ET AL.
v.
UNITED LAND CORPORATION OF AMERICA, ET AL.

         FROM THE CIRCUIT COURT OF ALBEMARLE COUNTY Paul M. Peatross, Judge Designate

          PRESENT: Lemons, C.J., Goodwyn, Mims, McClanahan, Kelsey, and McCullough, JJ., and Koontz, S.J.

          OPINION

          D. ARTHUR KELSEY JUSTICE

         In the circuit court, two property owners' associations ("POAs") sued various owners and developers of parcels in the Hollymead Town Center ("HTC"), a shopping center, claiming that HTC's sediment basins discharged sediment into a creek that flowed into a lake owned by the POAs. The POAs sought damages and injunctive relief. Holding that the incursion of sediment had been occurring for more than five years prior to the suit being filed, the circuit court sustained pleas in bar brought by the HTC defendants asserting the five-year statute of limitations. We affirm.

         I.

         "If the parties present evidence on [a] plea ore tenus, the circuit court's factual findings are accorded the weight of a jury finding and will not be disturbed on appeal unless they are plainly wrong or without evidentiary support." Hawthorne v. VanMarter, 279 Va. 566, 577, 692 S.E.2d 226, 233 (2010); see also Pike v. Hagaman, 292 Va. 209, 214, 787 S.E.2d 89, 92 (2016). Thus, under the "governing standard of review" applicable to judges sitting as factfinders no less than jurors, "we review factfinding with the highest degree of appellate deference." Vasquez v. Commonwealth, 291 Va. 232, 248, 781 S.E.2d 920, 929 (2016) (citation omitted). We thus review the evidence in the light most favorable to the prevailing parties and accept as true any reasonable inferences that could be drawn from the evidence before the factfinder. See Commonwealth ex rel. Fair Hous. Bd. v. Windsor Plaza Condo. Ass'n, 289 Va. 34, 59, 768 S.E.2d 79, 91 (2014).

         A.

         Created in the 1960s, the Hollymead residential subdivision lies just east of Route 29 in Albemarle County. The subdivision developer originally dug a sediment basin to support the construction effort. The basin accumulated sediment from the residential construction site as well as from Powell Creek, which flowed through the watershed west of Route 29 and underneath it through a culvert to the sediment basin. The developer ultimately turned the sediment basin into a lake, known as Lake Hollymead, and encircled it with residential lots.

         In 2003, commercial developers started construction of HTC on property situated west of Route 29 in the watershed area that included Powell Creek, the waterway that flowed into Lake Hollymead. The County's planning staff recommended, and the County Board approved, the HTC development plan that authorized the construction of three sediment basins. All three were permanently in place by fall 2004. The sediment basins complied with local and state regulations, which require the sediment basins to retain a maximum of 60% of sediment flowing into them and allow approximately 40% of sediment to discharge into surrounding waterways.[1]

          Forest Lakes Community Association, Inc., and Hollymead Citizens Association, Inc., (collectively, the "POAs") are property owners' associations that jointly own Lake Hollymead. Shortly after the HTC development began in 2003, the POAs and their members complained that excessive sedimentation was flowing from the denuded areas of the new HTC site, into Powell Creek, through a culvert, and ultimately into Lake Hollymead. The County considered, but ultimately rejected, suggestions for more robust sediment and erosion controls on the HTC site including, for example, water-filtration and purification systems to reduce sediment entering Powell Creek.

         In late 2004 and early 2005, members of the POAs discussed the need to take legal action. The POAs, however, waited until 2011 to file their suit seeking damages and injunctive relief against the developers, contractors, and owners of the HTC site (the "HTC defendants").[2]At the time of filing, eight years had passed from the start of the HTC project, and seven years had passed since the construction of the three HTC sediment basins. The POAs' amended complaint alleged that sediment from the HTC site began to enter Lake Hollymead as soon as the topography of the HTC site was denuded and destabilized in 2003 and 2004. "After such land clearance, the resultant runoff of sediments and silt entered Powell Creek, and thence flowed into Lake Hollymead." J.A. at 59. "[A]s early as 2005, " the POAs alleged, "sediment pollution, including visible soil banks, were already starting to form in Powell Creek and at the headwaters of Lake Hollymead." Id. at 63. "The runoff and subsequent deposits of silt, sediments and pollution continue to this day, in varying amounts depending upon site conditions, weather and the effectiveness of erosion controls at the site, with each new release of silt and sediments constituting a new and independent trespass to the [POAs'] properties, " the POAs alleged. Id. at 59. "Such sediment releases and discharges are continuing." Id. at 60.

         The POAs asserted two common-law rights of action, trespass and nuisance. They sought an award of compensatory and punitive damages along with an injunction abating the ongoing sediment incursion into Lake Hollymead. The HTC defendants responded with demurrers and pleas in bar. Each of the pleas in bar asserted that the POAs' trespass and nuisance claims accrued as early as 2003 and no later than 2005 and thus were barred by Code § 8.01-243(B), which provides that "[e]very action for injury to property . . . shall be brought within five years after the cause of action accrues."

         B.

         The circuit court conducted an ore tenus hearing on the pleas in bar.[3] After hearing evidence for a full day, the court stated that it would take the matter under advisement and issue a ruling after receiving briefs from the parties. Approximately seven months after the hearing, however, counsel learned that the case had been referred to another judge. Shortly thereafter, a recusal order informed counsel that the second judge assigned to the case had recused herself from the case, and a subsequent order reflected that it would be reassigned to yet another judge. A retired judge sitting by designation then presided over "a new evidentiary hearing" and required that the exhibits presented at the earlier hearing be "moved into evidence" in the new hearing, J.A. at 414, [4] which suggested that the court was limiting itself to the record developed at the new hearing.

         At the new evidentiary hearing, the parties offered witnesses and exhibits seeking to identify the timing, manner, quantum, and consistency of sediment discharge into Hollymead Lake allegedly caused by the HTC sediment basins. The HTC defendants asserted that the major sediment flow occurred during the construction process from 2003 to 2004. The discharge flow continued, they argued, on a regular basis thereafter. By fall 2004, each of the three sediment basins were permanently in place. Id. at 533-35, 550-51, 554-55. The County engineer responsible for administering the water-protection ordinance testified that "there's always some silt and sediment that flows through the basin." Id. at 514; see also id. at 524.

         The County engineer, testifying as an expert on erosion and sediment control and watershed protection on behalf of the HTC defendants, also stated that multiple other sites west of Route 29 (including a mobile home park, an airport construction site, a post office, and a church) were connected to the same watershed and "continue to contribute to the sediment load" that ultimately made its way into Lake Hollymead. Id. at 503-04. Even so, the expert opined, all of the discharge "was in keeping with the County's regulations as well as the Virginia erosion and sediment control regulations, " id. at 499, and in "full compliance" with the regulators' expectations of the efficacy of the sediment basins, id. at 507. These "sediment basins" were "working as they are designed to perform." Id. at 525-26. Under these facts, the HTC defendants contended that the cause of action for property damage first accrued no later than 2004, resulting in an expired statute of limitations in 2009.

         The POAs sought to present a slightly different factual scenario with significantly different legal consequences. They acknowledged the early incursion of sediment into Lake Hollymead during the construction time-frame, but they claimed that separate and distinct sediment incursions occurred later, each triggering the accrual of new causes of action that began anew the five-year statute of limitations. This thesis, however, was not supported by any detailed evidentiary showing. The POAs' counsel took the position that it was unnecessary "to separate out how much silt came from who and when and where" because that "has nothing to do with a Plea in Bar on the statute of limitations against these defendants." Id. at 486.

         The POAs' expert witness, moreover, appeared to concede the difficulty of measuring distinct, free-standing episodes of sediment flows when asked, "isn't it true that there is always silt and sediment flowing through the Hollymead Town Center sediment basin, through Powell Creek into Lake Hollymead?" Id. at 703. The expert answered: "Sure. There's always sediment in every body of water." Id. He later characterized the continuous sediment flow as "insignificant, " id., but he never testified that there was ever any period of time in which the sediment flow was not continuous.

         In his motion to strike and closing arguments, the POAs' counsel admitted that "from the beginning, there's no dispute by anybody that in 2005 and earlier Lake Hollymead received a lot of sediment. It was muddy, discolored. Sediment was coming from HTC. That's all been agreed." Id. at 723-24. Various storm events, he nonetheless argued, created an "intermittent continuous sequence." Id. at 599. Counsel asked rhetorically, "How much erosion will run off from the bare soil at HTC and actually make it to the basin?" Id. at 727. "Those are all things we don't know. But what they do attribute to is a highly variable mix of discharges from these basins." Id. The POAs' counsel added that any "continuous discharge" of sediment into Lake Hollymead was not a "significant contribution" to the total amount of sediment deposited in the Lake. Id. at 598.

         In the alternative, the POAs' counsel argued that the sediment discharges, even if continuous, constituted a "continuing trespass, " and thus, "the statute of limitations does not run because it's a continuing trespass." Id. at 603-04; see also id. at 725, 734. "So those sediments, whatever amount they are, they are in Lake Hollymead, and they are still there. They came from HTC, at least in part, and until they are removed, it is a continuing trespass." Id. at 605; see also id. at 734. No statute of limitations ever runs, counsel contended, until after the HTC defendants dredge their sediment out of Lake Hollymead. Id. at 604, 607.[5]

         Sitting as factfinder, the court ruled against the POAs on the first issue, whether discharge was continuous or intermittent. "I really studied closely and listened carefully to the Plea in Bar on the continuing flow versus intermittent flow, " the judge stated, "and I find that the defendants have sustained their burden, and I'm going to sustain the Plea in Bar." Id. at 739. As for the POAs' alternative continuing-trespass argument, the court held as a matter of law: "I'm going to sustain the Plea in Bar in terms of there's no continuing trespass with no statute ...


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