Nandan, LLP and Border States Paving, Inc., Plaintiffs and Appellants
City of Fargo, a municipal corporation, Defendant and Appellee
Appeal from the District Court of Cass County, East Central Judicial District, the Honorable Steven L. Marquart, Judge.
Joseph A. Turman (argued) and Katrina A. Turman Lang (on brief), Fargo, N.D., for plaintiffs and appellants.
Jane L. Dynes (argued) and Ronald H. McLean (on brief), Fargo, N.D., for defendant and appellee.
Lisa Fair McEvers, Carol Ronning Kapsner, Dale V. Sandstrom, Daniel J. Crothers, Gerald W. VandeWalle, C.J. Opinion of the Court by McEvers, Justice.
[¶1] Nandan, LLP, and Border States Paving, Inc., (collectively, " Border States" ) appeal from a district court judgment dismissing its amended complaint against the City of Fargo for failure to state a claim on which relief can be granted. The district court concluded Border States' amended complaint provided no right to relief under N.D.C.C. § § 40-22-06 and 40-22-15. We affirm the part of the judgment concluding Border States had no right to relief against Fargo under N.D.C.C. § 40-22-06, relating to when a resolution of necessity is required and the right of public protest arises under an agreement between a municipality and another entity. We reverse and remand the part of the judgment concluding Border States had no right to relief under N.D.C.C. § 40-22-15, relating to the requirements for resolutions declaring an improvement necessary, because viewing the allegations in the amended complaint in the light most favorable to the plaintiff, we are not certain of the impossibility of proving a claim upon which relief can be granted.
[¶2] Nandan, LLP, and Border States Paving, Inc., own real property located at 4101 32nd Street North in Fargo. On May 31, 2012, a landslide occurred along 32nd Street North adjacent to the industrial facility of Border States. According to a report from Braun Intertec Corporation contained in the record, the landslide likely originated from a stockpile of granular material located on Border States' property. The landslide ruptured a water main and storm sewer, and damaged 32nd Street North and Drain No. 10. Drain No. 10 is owned, operated, and maintained by the Southeast Cass Water Resource District (" Water District" ). Fargo owns the street, water main, and storm sewer.
[¶3] Border States received a notice from Fargo dated July 18, 2013, stating: " The City of Fargo has created Improvement District 6237 to fund a portion of the local share of a project that would provide for drain, water main and sanitary sewer repairs on a portion of Cass County Drain No. 10 north of Cass County Road 20." The notice indicated Fargo would contribute approximately $600,000 to the project. The notice stated Fargo would pay its share through special assessments assessed to real property owners within the improvement district. The only real property within the improvement district to be assessed was owned by Border States.
[¶4] The consent agenda for the Fargo City Commission meeting on July 22, 2013, contained documents related to the improvement district. One of the documents was a checklist titled " Cover Sheet City of Fargo Projects." The checklist states it must be completed and turned in with all City of Fargo projects. The checklist also contains items to be checked " when all or part of a project is to be special assessed." One of the items to be checked when a project is to be paid for by special assessments is titled " Adopt Resolution of Necessity." For Improvement District No. 6237, the " Adopt Resolution of Necessity" line item was not checked; rather, it was labeled " N/A."
[¶5] Another document related to the improvement district was an Engineer's Report dated July 18, 2013. It described the improvement district as follows:
Nature & Scope
This Improvement District is for the reconstruction of Drain No. 10 and adjacent water main, sewer main, and 32nd Street North. The purpose of the project is to repair the damage caused to this infrastructure from a deep rotational failure that caused uplifting of the drain bottom, shifting of 32nd Street North, and damage to buried utilities.
. . .
This project is intended to restore the function of Drain 10 where the geotechnical failure has occurred and repair 32nd Street North and the affected utilities within the road corridor.
At its regular meeting on July 22, 2013, the Fargo City Commission approved the creation of " 2013 Cass County Drain No. 10 Channel Repairs Improvement District No. 6237" in Fargo. The Fargo City Commission did not adopt a resolution of necessity for the improvements described in the Engineer's Report.
[¶6] On August 6, 2013, Fargo entered into a Joint Powers Agreement with the Water District. The agreement set forth the obligations of Fargo and the Water District in relation to the work to be done within the improvement district. The agreement stated the project was necessary to " ensure proper drainage in Drain 10," and for " purposes of repairing the water and sewer infrastructure, as well as 32nd Street." Under the agreement, the
Water District was responsible for designing the project in cooperation with Fargo. Fargo was responsible for bidding out the project, entering into a construction contract for construction of the project, and constructing the project according to ...