SD Supreme Court reverses circuit court’s decision in civil case filed against city of Belle Fourche

The South Dakota Supreme Court reversed a circuit court decision involving a lien on the property pictured on Edmonds Street in Belle Fourche. The court remanded the case back to the circuit court to hear again. Pioneer photo by Lacey Peterson

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BELLE FOURCHE –– The South Dakota Supreme Court reversed the 4th Circuit Court’s June 19, 2018, decision to dismiss a civil case filed against the city of Belle Fourche and denied the city’s motion seeking the awarding of costs and attorney’s fees from Bingham Farms Trust. 

According to the Supreme Court opinion, filed Wednesday, Bingham Farms Trust, which is listed under a Sturgis address, filed an appeal with the Supreme Court, alleging that after the trust purchased a Belle Fourche property, the city illegally applied a special assessment to it.

Bingham Farms Trust requested that the Supreme Court decide whether the circuit court erred in granting the dismissal of the case. 

According to court documents, Bingham Farms Trust filed a civil suit Jan. 26, 2018, against the city seeking damages regarding a lien placed on a property it purchased from Juanita Bowman on Jan. 17, 2017. The $1,374.45 lien was the result of an unpaid assessment placed on the property due to fees accrued for yard work performed by the city prior to the sale of the property, located on Edmunds Street in Belle Fourche. 

Bingham Farms Trust alleged in its complaint that a title search performed on the property prior to its purchase showed no liens against the property. 

A letter dated July 19, 2017, written by Dave Claggett, an attorney representing Bingham Farms Trust, claimed that the city filed a special assessment lien against the property after its purchase. Additionally, the complaint stated that for reasons unknown, a title insurance policy was issued after the purchase that contained no date except an “effective date” of Jan. 17, 2017. However, the envelope from Black Hills Title Company, which was attached to the complaint as a material evidence exhibit, was postmarked March 2, 2017, “substantially after the purchase and was the first time the claimed special assessment lien was disclosed,” the letter stated.

The complaint alleged that repeated requests from Bingham Farms Trust asking the city to provide proof of such lien were fruitless. 

“To this date, plaintiff (Bingham Farms Trust) is still waiting for confirmation from defendant (the city of Belle Fourche) as to what this lien is actually for, dates of claimed service, the person or persons performing the service, the legal authority for the claim, and the legal authority to attach the claim to plaintiff’s property,” the complaint read.

It is the position of the trust that the lien is unsupported, unverified, and illegal, which disparages and slanders the title to the property and has frustrated Bingham Farms Trust’s title and use of its property, the complaint described.

Additionally, the complaint alleges that the city, knowing that Bingham Farms Trust had “worked diligently” on the property and planned to use the property as a rental and income property, willfully, wantonly, or maliciously slandered the trust by “publishing false statements derogatory to the trust’s disadvantage, which materially or substantially induced others not to deal with the trust,” causing damage and entitling the trust to punitive damages, according to the complaint.

Bingham Farms Trust asked the court to declare the city’s lien illegal and invalid and require the city to remove the lien from the property’s title. 

The city disputed Bingham Farms Trusts’ claims, saying in a statement filed with the court that the property lien was properly processed. The statement, dated April 9, 2018, and signed by Kellen Willert, one of the attorneys who represents the city, said the assessment was assigned to the property for vegetation removal. The assessment was heard by the Belle Fourche City Council during an Aug. 1, 2016, public hearing to consider the assessment roll for the 2015-2016 nuisance abatements, which no one spoke against. At the time of the hearing, the property was in Bowman’s name. Following the public hearing, the council adopted a resolution approving the assessment roll, and notice of the city’s adoption of the assessment roll was published in the Aug. 10, 2016, edition of the Butte County Post, the city’s legal newspaper at the time, pursuant to South Dakota Codified Law (SDCL) 9-43, which governs the special assessment process. 

In the city’s statement of undisputed material facts, it claimed that no appeal was filed before Aug. 31, 2016, related to the special assessment as allowed by law.

According to SDCL 9-43-96, “… The decision of a municipal governing body upon a special assessment roll may be appealed to circuit court. The appeal shall be made within 20 days after publication of a notice that the resolution confirming the special assessment roll has been adopted by filing written notice of the appeal with the municipal finance officer and the clerk of the circuit court in the county in which the real property is situated.”

According to SDCL 9-43-100, “… Any special assessment lawfully levied upon real property assessed pursuant to this chapter is a continuing lien on the property as against all persons except the United States and this state. The lien continues for 15 years from the due date of the last installment.”

Willert asserted that as a part of its purchase agreement with Bowman, Bingham Farms Trust agreed to assume all debt and legal responsibilities regarding the property. 

In addition to the trust failing to appeal the special assessment in time, Willert alleges that the trust filed a notice of claim regarding the assessment seeking damages from the city after the deadline allowed by state statute. SDCL 3-21-2 states that persons wishing to file a claim seeking damages have 180 days to provide written notice of the time, place, and cause of the injury to the public entity, in the case, the city, within 180 days after the alleged injury. Willert stated that the claim was served upon the city on July 19, 2017, approximately 353 days after the assessment was applied to the property. 

On June 19, 2018, 4th Judicial Circuit Court Judge Michael Day granted the city’s motion to dismiss. Additionally, Day denied the city’s motion seeking the awarding of costs and attorney’s fees from Bingham Farms Trust. 

The Supreme Court reversed the circuit court’s dismissal, affirmed its denial of attorney fees to the city, and remanded the case back to the circuit court.

 “Even if the circuit court correctly determined that it lacked subject matter jurisdiction to consider a collateral challenge to the creation of the lien upon the Edmonds Street property, it does have jurisdiction to determine the enforceability of the lien against Bingham,” the opinion states. “Under the circumstances, the circuit court’s denial of the City’s request for attorney fees was not an abuse of its discretion.”

The case has not yet been scheduled to be heard by Day in Butte County.

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