AUSTIN PRINCE, WILLIE REINHARDT, MARY E. LOWMAN, DEBORAH BROWN, KEVIN STEELAND, PHYLLIS STINSON, THOMAS LOWMAN, AND RICHARD SMITH APPELLANTS
ARKANSAS STATE HIGHWAY COMMISSION; ARKANSAS DEPARTMENT OF TRANSPORTATION; AND SCOTT E. BENNETT, IN HIS OFFICIAL CAPACITY AS DIRECTOR OF THE ARKANSAS DEPARTMENT OF TRANSPORTATION APPELLEES
FROM THE PULASKI COUNTY CIRCUIT COURT, SECOND DIVISION [NO.
60CV-18-345 ]HONORABLE CHRISTOPHER CHARLES PIAZZA JUDGE.
Ragon Owen, P.A., by: John P. Gill and Mitchell S. Dennis;
and Robert Keller Jackson, PLLC, by: Robert K. Jackson, for
Rutledge, Att'y Gen., by: William C. Bird III and
Brittany N. Edwards, Ass't Att'ys Gen., for appellee.
F. WYNNE, ASSOCIATE JUSTICE
Austin Prince, Willie Reinhardt, Mary E. Lowman, Deborah
Brown, Kevin Steeland, Phyllis Stinson, Thomas Lowman, and
Richard Smith appeal from an order of the Pulaski County
Circuit Court granting a motion to dismiss filed by the
Arkansas State Highway Commission; the Arkansas Department of
Transportation; and Scott E. Bennett, in his official
capacity as director of the Arkansas Department of
Transportation. We affirm.
Arkansas State Highway Department determined that a new
bridge was needed on Highway 79 to span the White River at
Clarendon as part of a realignment and expansion of the
highway. Because Highway 79 runs through federal land at that
location, the Department was required to obtain an easement
from the federal government. To that end, the Department
entered into an agreement with the United States Fish and
Wildlife Service (USFWS). Under the agreement, the Department
would cede fifty acres of property to USFWS in exchange for a
49.69-acre easement over land in the Cache River and White
River Wildlife Refuges. The Department also agreed to convey
ninety-seven acres of land in Monroe County to USFWS to
mitigate for the loss of habitat quantity and quality caused
by the realignment and expansion of Highway 79. The agreement
further required the Department to demolish three bridges,
one of which is the old Clarendon bridge, remove all bridge
structures, restore the natural topography, and reestablish
native hardwood vegetation. To comply with this provision of
the agreement, the Department planned to invite bids and
enter into a contract with the winning bidder on the
bridge-demolition project, with an estimated cost of $10.8
filed a motion for preliminary injunction and complaint for
declaratory and injunctive relief alleging that the contract
between the Department and USFWS is void because it is
unconscionable, entered into under duress, and constitutes a
windfall to USFWS. They also alleged that there exists a
mutual mistake of fact regarding the necessity of removing
the old Clarendon bridge. Appellants contended in the
complaint that, because the contract is void, the monetary
expenditures constitute an illegal exaction, for which suit
is permitted under article 16, § 13 of the Arkansas
Constitution. In the complaint, appellants requested a
permanent injunction restricting the Department from
demolition activities for the old Clarendon bridge as well as
reasonable attorney's fees, costs, and expenses.
moved to dismiss the complaint on the following grounds: (1)
the complaint is barred by sovereign immunity; (2) appellants
lack standing to challenge the agreements; (3) the complaint
fails to state a claim for which relief may be granted; and
(4) appellants failed to join an indispensable party (USFWS).
Appellees also contested the motion for a preliminary
injunction, contending that it was barred by sovereign
immunity and failed to satisfy the requirements of Arkansas
Rule of Civil Procedure 65 (2017). The circuit court granted
the preliminary injunction with the stated goal of giving the
parties time to explore settlement. The parties were unable
to settle, and the circuit court entered an order granting
the motion to dismiss on all four grounds asserted by
appellees. This appeal followed.
appeal from the grant of a motion to dismiss. In reviewing a
trial court's decision on a motion to dismiss under Ark.
R. Civ. P. 12(b)(6), we treat the facts alleged in the
complaint as true and view them in the light most favorable
to the party who filed the complaint. Goforth v.
Smith, 338 Ark. 65, 991 S.W.2d 579 (1999). In testing
the sufficiency of the complaint on a motion to dismiss, all
reasonable inferences must be resolved in favor of the
complaint, and pleadings are to be liberally construed.
Hames v. Cravens, 332 Ark. 437, 442, 966 S.W.2d 244,
247 (1998). However, our rules require fact pleading. A
complaint must state facts, not mere conclusions, in order to
entitle the pleader to relief. Brown v. Tucker, 330
Ark. 435, 438, 954 S.W.2d 262, 264 (1997); Ark. R. Civ. P.
sole claim in their complaint is that the agreement between
the Department and USFWS constitutes an illegal exaction.
Article 16, § 13 of the Arkansas Constitution provides:
"Any citizen of any county, city or town may institute
suit, in behalf of himself and all others interested, to
protect the inhabitants thereof against the enforcement of
any illegal exactions whatsoever." This court has held
that such a suit is not barred by the constitution's
sovereign-immunity provision, article 5, § 20, because
article 16, § 13, as a more specific provision, controls
over the more general prohibition in article 5, §
McGhee v. Ark. State Bd. of Collection Agencies, 360
Ark. 363, 201 S.W.3d 375 (2005); Carson v. Weiss,
333 Ark. 561, 972 S.W.2d 933 (1998); Streight v.
Ragland, 280 Ark. 206, 209-10 n. 7, 655 S.W.2d 459, 461
n. 7 (1983).
citizens are constitutionally permitted to sue the state for
an illegal exaction. The question before us in this appeal is
whether appellants' complaint states a cause of action
for an illegal exaction. We hold that it does not.
illegal exaction is an exaction that is either not authorized
by law or is contrary to law. Stromwall v. Van
Hoose, 371 Ark. 267, 265 S.W.3d 93 (2007). Two types of
illegal-exaction cases can arise under article 16, section
13: "public funds" cases, where the plaintiff
contends that public funds generated from tax dollars are
being misapplied or illegally spent, and
"illegal-tax" cases, where the plaintiff asserts
that the tax itself is illegal. McGhee, 360 Ark.
363, 201 S.W.3d 375 (2005). This court has stated that
citizens have standing to bring a "public funds"
case because they have a vested interest in ensuring that the
tax money they have contributed to a state or local
government treasury is lawfully spent. Ghegan &
Ghegan, Inc. v. Weiss, 338 Ark. 9, 991 S.W.2d 536
(1999). Accordingly, "a misapplication by a public
official of funds arising from taxation constitutes an
exaction from the taxpayers and empowers any citizen to
maintain a suit to prevent such misapplication of
funds." Farrell v. Oliver, 146 Ark. 599, 602,
226 S.W. 529, 530 (1921). When the expenditure is authorized
by statute, no illegal exaction occurs. Sullins v. Cent.
Ark. Water, 2015 Ark. 29, 454 S.W.3d 727.
review of appellants' complaint reveals that it lacks
sufficient facts to state a claim for an illegal exaction.
Appellants do not allege in the complaint that the Department
lacks the authority to enter into the agreement with USFWS.
In fact, the Department has express statutory authority to
"let all contracts for construction, improvement, and
maintenance of roads comprising the state highway
system." Ark. Code Ann. § 27-65-107(a)(2) (Supp.
2017). It also has the express authority to "enter into
all agreements with the United States government relating to
the survey, construction, improvement, and maintenance of
roads under the provisions of any present or future
congressional enactment." Ark. Code Ann. §
27-65-107(a)(3)(A). Appellants also do not allege that the
Department failed to follow any applicable statute, rule, or
regulation with regard to the agreement.
complaint does not allege any wrongdoing on the part of the
state at all. Instead, it alleges that USFWS took advantage
of the Department's highway-expansion project to force
unreasonable terms on the state and attempts to assert
various contract defenses on the state's behalf. This is
not sufficient to establish a claim for an illegal exaction.
See Bowerman v. Takeda Pharm. U.S.A., 2014 Ark. 388,
442 S.W.3d 839 (holding that a claim that the state's
treasury was diminished by reimbursements for a prescription
medication alleged to have caused serious health problems was
not one for illegal exaction ...