City of Corbin v. City of London

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CITY OF CORBIN, KENTUCKY; CITY UTILITIES COMMISSION OF CORBIN, KENTUCKY; AND MPI KY, LLC APPELLANTS v. CITY OF LONDON, KENTUCKY APPELLEE AND CITY OF LONDON, KENTUCKY CROSS-APPELLANT v. CITY OF CORBIN, KENTUCKY; CITY UTILITIES COMMISSION OF CORBIN, KENTUCKY; AND MPI KY, LLC CROSS-APPELLEES

Nos. 2022-CA-0221-MR, 2022-CA-0334-MR

Court of Appeals of Kentucky

May 5, 2023

NOT TO BE PUBLISHED

APPEAL FROM LAUREL CIRCUIT COURT HONORABLE GREGORY A. LAY, JUDGE ACTION NO. 20-CI-00662

CROSS-APPEAL FROM LAUREL CIRCUIT COURT HONORABLE GREGORY A LAY, JUDGE ACTION NO. 20-CI-00662. AFFIRMING IN PART VACATING IN PART, AND REMANDING

BRIEFS FOR APPELLANTS/CROSS- APPELLEES: Patrick R. Hughes Christopher B. Markus Joseph M. Kramer Covington, Kentucky

BRIEFS FOR APPELLEE/CROSS-APPELLANT CITY OF LONDON KENTUCKY: Larry G. Bryson London, Kentucky David A. Pike F. Keith Brown Shepherdsville, Kentucky

BEFORE: THOMPSON, CHIEF JUDGE; COMBS AND JONES, JUDGES.

OPINION

COMBS, JUDGE

The City of Corbin, Kentucky, (Corbin); the City Utilities Commission of Corbin, Kentucky, (the Utilities Commission); and MPI KY, LLC (MPI), a private company, appeal from the summary judgment of the Laurel Circuit Court entered in favor of the City of London, Kentucky, (London). London cross-appeals. After carefully reviewing the record in light of the arguments of counsel, we conclude that the existence of a genuine issue of material fact precludes entry of summary judgment in London's favor and that London's crossappeal is without merit. Consequently, we affirm in part and vacate in part, and we remand for additional proceedings.

Pursuant to the provisions of KRS^[1] 81A.420, London proposed to annex two unincorporated areas in Laurel County. Tract 1 encompasses a portion of Interstate Highway 75 and its right-of-way for approximately nine miles. It borders London's southern city limits. Tract 2, located at the intersection of Interstate Highway 75 and West Cumberland Gap Parkway, is adjacent to Tract 1 and is owned by G &M Oil Company. G &M Oil Company requested the annexation. Together, the tracts total 639 acres.

On August 12, 2020, Ordinance 2020-10 received its first reading. The ordinance defined the boundaries of the unincorporated territory proposed to be annexed and stated the intention of London to annex it. The ordinance directed that written notice of London's intention to annex the properties be mailed to the property owners of Tract 1 and Tract 2 as required by the provisions of KRS 81A.425.

On September 10, 2020, Corbin's counsel sent correspondence by email to London's City Attorney advising that Corbin owned utility infrastructure within Tract 1. Counsel noted that London had failed to provide notice of the proposed annexation to Corbin's mayor no later than fourteen (14) days prior to the meeting at which the ordinance would receive its second reading as required by the provisions of KRS 81A.427(3). Corbin lodged an informal objection to the annexation of Tract 1 and requested that London's city council postpone its meeting. However, London did not postpone the meeting, and on the evening of September 10, 2020, the ordinance received its second reading. Corbin's mayor appeared at the meeting to oppose the proposed annexation. The ordinance passed unanimously. Thereafter, London provided public notice of the ordinance in September, October, and December 2020.

On September 11, 2020, the day after London's city council meeting, Corbin filed a petition for declaration of rights in Laurel Circuit Court. Corbin alleged that two controversies existed. First, Corbin challenged the legality of the ordinance proposing the annexation of Tract 1 and Tract 2 "on the basis that neither territory is suitable for annexation pursuant to the terms of KRS 81A.410." In part, it alleged that the annexation of Tract 1 constitutes prohibited "corridor annexation" and fails to serve a municipal purpose. It alleged that without annexation of Tract 1, Tract 2 is not contiguous or adjacent to London as required for its annexation. Second, it challenged London's failure to notify its mayor of the proposed annexation of Tract 1, "which houses utility infrastructure for water and sewer services, which is owned by Corbin, pursuant to KRS 81A.427." Citing the remedy provisions of KRS 81A.427(7), Corbin requested the court to declare the ordinance void.

On September 30, 2020, Corbin amended its petition to include MPI as a party-plaintiff and to add allegations concerning an additional controversy between the opposing parties. MPI owns property adjacent to Tract 1, and it also objected to London's decision to annex the area.

London answered and denied many of the substantive allegations of the petition. However, it acknowledged that it did not provide written notice of the proposed annexation to Corbin's mayor. It alleged that it was not required to do so under the circumstances and noted that Corbin's mayor unquestionably received actual notice of the ordinance as she appeared at the city council meeting.

London also challenged the jurisdiction of the court. It argued that the court was not empowered by the provisions of KRS 81A.427(7) to declare its ordinance void because Corbin had not formally objected to the proposed annexation by timely forwarding a certified copy of a municipal order as required by the provisions of KRS 81A.427(5). It also contended that no actual controversy existed between the party opponents; that Corbin and MPI had no rights or interests with respect to London's "intent to annex ordinance"; that both Corbin and MPI lacked standing; and that neither could show that either had been aggrieved, harmed, or damaged by the ordinance.

On November 6, 2020, the Utilities Commission filed a motion to intervene in the action and tendered an intervening complaint for declaration of rights. Although Corbin owns the utility infrastructure, the Utilities Commission claimed that it acts as a trustee operating and managing the utility services. It alleged that its interests were not adequately represented by Corbin. London challenged the motion to intervene. It noted that all rights of utilities providing utility services in any area annexed by a city prior to the annexation are expressly preserved by the provisions of KRS 81A.490; therefore, no interests of the Utilities Commission were at stake.

The trial court granted the motion to intervene, and the Utilities Commission's tendered complaint was filed in the record. London filed its answer, and a period of intense discovery began. On January 6, 2021, London's city council adopted an ordinance finally annexing the disputed areas.

On March 8, 2021, Corbin, the Utilities Commission, and MPI filed a motion for summary judgment. London fled a cross-motion for summary judgment. Oral arguments were conducted before the trial court on July 22, 2021. By its order entered on February 9, 2022, the court granted London's motion for summary judgment. Without addressing the substantive contentions, the circuit court concluded that Corbin, the Utilities Commission, and MPI each lacked standing to maintain the action. Corbin, the Utilities Commission, and MPI filed this appeal; London filed a cross-appeal.

On appeal, Corbin contends that the trial court erred by concluding that it lacked standing as a matter of law. We agree.

Constitutional standing is prerequisite to establishing the existence of a justiciable cause. Lincoln Trail Grain Growers Association, Inc. v. Meade Cnty. Fiscal Court, 632 S.W.3d 766 (Ky. App. 2021). The "justiciable cause" requirement in Kentucky Constitution, Section 112(5) is the basis of the trial court's jurisdiction. "To invoke the court's jurisdiction, the plaintiff must allege an injury caused by the defendant of a sort the court is able to redress." Lawson v. Office of the Attorney General, 415 S.W.3d 59, 67 (Ky. 2013).

So-called "statutory standing" is conferred where "a statute creating a private right of action authorizes a particular plaintiff to avail herself of that right of action." Id. (citing Small v. Federal National Mortgage Association, 286 Va. 119, 747 S.E.2d 817 (2013) (quoting CGM, LLC v. BellSouth Telecomm., Inc., 664 F.3d 46, 52 (4th Cir. 2011))).

The first issue we address is whether the trial court erred by concluding that Corbin is not authorized by statute to pursue its litigation against London.

The provisions of KRS 81A.427(3) require a city proposing to annex an unincorporated area under the provisions of KRS 81A.420 to send notice of the proposed annexation "to the mayor of each city government owning utility infrastructure within the area proposed to be annexed." The timing and content of the notice are expressly prescribed by statute. KRS 81A.427(3)(a), (b), (c).

A city owning utility infrastructure as described which receives such a notice "shall have the right to object and prevent the annexation by sending a certified copy of a municipal order enacted pursuant to KRS 83A.060." KRS 81A.427(5) (emphasis added). The contents of the municipal order and the methods by which it can be delivered are carefully prescribed. Id. The certified copy of the municipal order "shall be received by the city acting [to annex property] at any time before or at the meeting where the ordinance is scheduled to receive its second reading." Id.

The provisions of KRS 81A.427(6) direct that a city shall not annex any area that includes utility infrastructure owned by a city objecting under subsection (5) of the statute unless the cities in interest agree through an interlocal agreement. If a city proposing to annex does not receive a municipal order from an affected city prior to or at the meeting, the annexing city may proceed to enact its...