                IN THE COURT OF APPEALS OF TENNESSEE
                             AT JACKSON
                                   July 17, 2012 Session

  CITY OF MEMPHIS, A MUNICIPAL CORPORATION FOR THE USE
  AND BENEFIT OF MEMPHIS LIGHT GAS AND WATER v. TANDY J.
               GILLILAND FAMILY, L.L.C., ET AL.

               Direct Appeal from the Circuit Court for Shelby County
                    No. CT-000435-10     James F. Russell, Judge


                No. W2011-01611-COA-R3-CV - Filed August 29, 2012


This is a condemnation case. The trial court granted summary judgment in favor of
Appellees, the landowners, finding that Appellant MLGW’s attempted condemnation was
not necessary. The evidence clearly establishes that MLGW had the right to take, and that
the taking was for a public purpose. Therefore, the burden fell to Appellees to show that
MLGW’s taking was arbitrary or capricious. The evidence contained in the record does not
establish that the taking was arbitrary or capricious with the result being that the
condemnation is “conclusive upon the court.” Because the court considered necessity and
location in contravention of MLGW’s condemnation power, we reverse the grant of summary
judgment and remand to the trial court.

Tenn. R. App. P. 3. Appeal as of Right; Judgment of the Circuit Court Reversed and
                                     Remanded

J. S TEVEN S TAFFORD, J., delivered the opinion of the Court, in which A LAN E. H IGHERS, P.J.,
W.S., and H OLLY M. K IRBY, J., joined.

Randall D. Noel, John C. Henegan, Elizabeth E. Chance, and Charlotte Knight Griffin,
Memphis, Tennessee, and Norman P. Hagemeyer, Ellendale, Tennessee, for the appellants,
City of Memphis, A Municipal Corporation for the Use and Benefit of Memphis Light, Gas
& Water Division.

Robert A. McLean and Allison Kay Moody, Memphis, Tennessee, for the appellees, Tandy
J. Gilliland Family, L.L.C., Tandy Jones Gilliland, Trustee, Tandy J. Gilliland and Rudolph
Jones, Jr., L.L.C., and Regina Morrison Newman, Shelby County Trustee.

                                         OPINION
                             I. Facts and Procedural History

        This case involves the attempted condemnation of three parcels of land by Appellant
The City of Memphis, for the use and benefit of Memphis Light, Gas and Water Division
(“MLGW”). These parcels are currently owned by Tandy J. Gilliland Family, L.L.C., Tandy
J. Gilliland and Rudolph Jones, Jr., L.L.C., and Tandy Jones Gilliland, Trustee of Callis
Brunswick Trust (together “Appellees”). The disputed parcels comprise the northwest and
northeast corners of the Canada Road and Highway 70 intersection (the “Intersection”), and
have been owned by Appellees, or affiliated entities, for over one hundred years.

       Since the 1950s, MLGW has had easements for its utility poles and lines on the
Appellees’ property at this Intersection. MLGW’s easements have always been separate
from any right-of-way held by the Tennessee Department of Transportation (“TDOT”).
However, in the fall of 2008, Appellees entered into a period of negotiation with TDOT
concerning the State of Tennessee’s plan to install a traffic signal at the Intersection.
Specifically, the parties discussed expanding TDOT’s existing right-of-way at the
Intersection to eighty feet north of the center line of Highway 70. The expansion was to
accommodate the widening of Highway 70 beyond its then-existing four lanes. On or about
March 30, 2009, Appellees deeded TDOT eighty feet of property as a right-of-way for the
expansion of the Intersection and for the installation of a traffic signal. The expanded right-
of-way encompassed MLGW’s existing easements. Appellees contend that, in their
negotiations, TDOT represented that utility providers, such as MLGW, who possessed
existing easements, would be compensated for their respective easements and would be
granted the right to relocate within the expanded right-of-way. However, the warranty deed,
under which Appellees granted the right-of-way to TDOT does not reflect any agreement
between Appellees and TDOT that MLGW’s poles and facilities would be relocated within
TDOT’s right-of-way.

       TDOT began construction at the Intersection. However, around October 2009,
construction came to a halt when MLGW refused to move its poles into TDOT’s expanded
right-of-way. On October 29, 2009, TDOT requested that MLGW move its poles into the
expanded right-of-way so that construction could resume; however, MLGW refused to
comply, and filed suit.

        On January 28, 2010, MLGW filed three lawsuits, one against each of the three
Appellees, seeking to condemn a portion of Appellees’ properties to create easements for its
utility poles. Approximately one year later, on January 12, 2011, the three lawsuits were
consolidated and MLGW filed an amended petition for condemnation against the Appellees.
By its petition, MLGW sought to condemn an eight-foot-wide easement across each of

                                              -2-
Appellees’ respective parcels to allow its utility facilities to be moved outside the expanded
TDOT right-of-way, as the situation had been since the 1950s. MLGW specifically sought
condemnation to “construct, maintain, improve or alter its transmission line” on portions of
the three properties owned by Appellees. MLGW also filed for a temporary, construction
easement over a fifteen-foot portion of each of the properties. For each of the three
properties, MLGW deposited funds with the court constituting the fair payment for both the
permanent and construction easements. The amended petition for condemnation also sought
to allow telecommunications and CATV carriers to continue their right to be attached to and
to operate and maintain their respective lines on MLGW’s utility poles.

      On February 14, 2011, Appellees filed a motion to dismiss the amended petition for
condemnation. In support of the motion, Appellees filed a statement of undisputed facts,
along with the affidavit of the custodian of records for the City of Lakeland. MLGW
responded to Appellees’ proposed facts and, additionally, filed its own statement of facts in
opposition to the motion to dismiss. Appellees responded to MLGW’s statement of facts by
submitting additional material facts and the deposition of William Goss, Shelby County’s
Real Estate Manager and a retired MLGW employee. MLGW filed its response to
Appellees’ additional facts and the case proceeded to hearing on the pending motions.

       On June 10, 2011, the trial court heard arguments on Appellees’ motion to dismiss the
amended petition and MLGW’s motion for condemnation, appropriation, and possession.
We note that the trial court considered matters outside the pleadings at this hearing. Rule
12.02 of the Tennessee Rules of Civil Procedure provides that if “matters outside the
pleadings are presented to and not excluded by the court,” then a motion to dismiss shall be
treated as a motion for summary judgment. Tenn. R. Civ. P. 12.02 (2011); see also Jones v.
Vasu, 326 S.W.3d 577, 580 (Tenn. Ct. App. 2010). Accordingly, Appellees’ motion to
dismiss was treated as one for summary judgment in the trial court.

        During the hearing, MLGW attempted to establish that there was a distinct and
concrete need for its new easement because its poles and lines had to be moved from their
existing location for the expansion of the Intersection. MLGW argued, that, by obtaining its
own easement, MLGW and its rate-payers would be protected from the increased expense
of moving its facilities a second time if and when TDOT expanded Highway 70 again in the
future. Appellees argued that MLGW’s condemnation was inappropriate because Appellees
had given property to TDOT for a right-of-way. Appellees alleged that it would be a better
plan to place MLGW’s poles within TDOT’s expanded right-of-way, and that, consequently,
it was not necessary for MLGW to have its own, separate easement. Appellees also argued
that MLGW was exceeding its eminent domain power under the Tennessee Code by seeking
permission for third parties (i.e., telecommunications and CATV providers) to continue to
attach to MLGW’s poles within the requested easement. MLGW argued that allowing

                                             -3-
telecommunications and CATV carriers to attach to its poles, once the poles were set up in
the new easement, did not exceed MLGW’s condemnation authority and did not change the
“public use” of its utility poles to a private use.1 MLGW also submitted plans, showing that
both MLGW and TDOT had always contemplated that MLGW would obtain its own
easement outside of TDOT’s right-of-way. One sketch, marked “approved” by TDOT in
June 2009 (which was approximately two months after Appellees granted the extended right-
of-way to TDOT) shows MLGW’s proposed utility easement outside TDOT’s right-of-way.
MLGW further cited to the Utility Relocation Contract between TDOT and MLGW, which
expressly states MLGW’s intention, allegedly known to TDOT, to obtain its own utility
easement outside of TDOT’s right-of-way. Moreover, MLGW argued that, because it was
to obtain its own easement independent of TDOT’s, it had agreed to transfer its existing
easement, now within TDOT’s expanded right-of-way, to TDOT.

        On July 1, 2011, the trial court entered an order, granting Appellees’ motion to
dismiss (now converted to a motion for summary judgment). The court attached a transcript
of its ruling from the bench to its July 1 order. In relevant part, the trial court noted two
grounds raised by Appellees to avoid condemnation: (1) that the relief sought exceeded
MLGW’s authority because it sought to allow “private” common carriers to access its poles;
and (2) MLGW failed to show a “necessary” purpose for the condemnation. The court ruled
that a public purpose for the condemnation was shown, even if telecommunications and
CATV carriers were permitted to attach to MLGW’s poles. The court then opined that the
second step in its analysis was to determine if MLGW’s taking was “necessary and
essential.” The trial court ultimately concluded that the taking was not necessary and
essential. MLGW argues that, in reaching its conclusion, the trial court improperly
substituted its judgment for that of MLGW by making a “general finding that showed a
fundamental misapprehension of MLGW’s existing easement and what [Appellees] could
properly convey to TDOT.” In support of its argument, MLGW cites to several of the trial
courts statements. First, the trial court’s statement that:

               [Appellee] owners in this case previously deeded to [TDOT]. .
               .all of the right, title and interest to all of the property deemed
               necessary for the widening of Highway 70 at its intersection
               with Canada Road. This was to include the relocation of
               MLGW’s utility poles and necessary and appropriate. . .right-of-
               way for that purpose. That to include all the existing facilities
               over and upon those poles, including any ancillary users.
               [MLGW] abjectly refused to relocate within that right-of-way


       1
         We note that the Federal Pole Attachment Act requires utilities to grant access to
telecommunications and CATV carriers at regulated rates. 47 U.S.C. §224(f)(1); see discussion infra.

                                                -4-
              for some reason that is yet unknown to the Court and for some
              reason that simply cannot be gleaned from this record. . . .

MLGW argues that this statement indicates that the trial court failed to consider the fact that
Appellees could not remove MLGW’s easement rights to certain portions of the property
conveyed because MLGW owned the easement and the utility poles and the attached
electrical lines and facilities located within the easement. In other words, Appellees did not
own the portion of the property that they tried to convey.

       The court went on to find that:

              Relocation was to be entirely at no cost to MLGW as TDOT is
              obligated to cover that cost by way of reimbursement to MLGW.
              MLGW refuses even to this day to cooperate. Rather, the
              Division seeks by these proceedings to encroach further upon
              the [Appellee] owners’ lands essentially for no better reason
              [other than] because it wants to do so and has the power to do
              so. . . .

MLGW argues that this finding represents a “further encroachment” that “overlooks the fact
that MLGW had a right to be on the property based upon the easement it has had for over 50
years.”

       The court further stated that:

              The Court bases that conclusion [i.e., that MLGW’s easement
              was not necessary] upon the Scotty Plunk memo, which has
              been quoted earlier, and the Goss testimony, where both Scotty
              Plunk and William Goss tell[] us that this particular taking is not
              necessary and essential. To the contrary, they tell us that the
              necessary and essential right-of-way was included in these
              earlier owners— in these owners’ earlier gift by deed of
              sufficient right-of-way for widening of Highway 70, including
              the relocation of the MLGW facilities, along with any associated
              users. The Court observes that this record is devoid of any
              indication of any other purpose or any conclusion otherwise. . .

                     With that understanding on this record the Court is of the
              opinion that the city has failed to demonstrate that the proposed
              additional taking is necessary and essential for relocation of its

                                              -5-
              facilities.

       Mr. Goss’ testimony will be discussed below. However, as to the “Scotty Plunk
memo,” the record shows that Mr. Plunk, an employee of TDOT, sent an email to MLGW
on October 29, 2010. In the email, Mr. Plunk opined that there is room in TDOT’s right-of-
way for MLGW’s utility poles, and that he could see no justifiable reason why MLGW
would not move its facilities into the TDOT right-of-way. Even though the trial court
obviously relied upon Mr. Plunk’s opinion, the record fails to establish that Mr. Plunk
possessed the authority to make the decision as to where MLGW must place its utility poles.
Moreover, Mr. Plunk’s email constitutes blatant hearsay, which the trial court admitted over
MLGW’s objection. In denying the objection, the trial court stated that it was going to “hear
everything everybody has to say,” and that “objection is not appropriate in motion hearings.”
We respectfully disagree. It is well settled that hearsay evidence cannot be considered on a
motion for summary judgment. Tennessee Rule of Civil Procedure 56.06 provides:

              Supporting and opposing affidavits shall be made on personal
              knowledge, shall set forth such facts as would be admissible
              in evidence, and shall show affirmatively that the affiant is
              competent to testify to the matters stated therein. Sworn or
              certified copies of all papers or parts thereof referred to in an
              affidavit shall be attached thereto or served therewith. The court
              may permit affidavits to be supplemented or opposed by
              depositions, answers to interrogatories, or further affidavits.
              When a motion for summary judgment is made and supported as
              provided in this rule, an adverse party may not rest upon the
              mere allegations or denials of the adverse party's pleading, but
              his or her response, by affidavits or as otherwise provided in
              this rule, must set forth specific facts showing that there is
              a genuine issue for trial. If the adverse party does not so
              respond, summary judgment, if appropriate, shall be entered
              against the adverse party. Expert opinion affidavits shall be
              governed by Tennessee Rule of Evidence 703.

Tenn. R. Civ. P. 56.06 (emphasis added). The email sent by Mr. Plunk and relied upon by
the trial court is simply unauthenticated hearsay and is inadmissible as contemplated by Rule
56.06; see also Cox v. Tennessee Farmers Mut. Ins. Co., 297 S.W.3d 237, 246 (Tenn. Ct.
App. 2009), perm. app. denied (Tenn. Aug. 31, 2009) (citation omitted); Price v. Becker, 812
S.W.2d 597, 598 (Tenn. Ct. App. 1991) ( holding that plaintiffs' documents attached to their
memorandum were inadmissible evidence as the documents were not authenticated by
affidavit as required by Rule 56.06). Accordingly, the trial court’s reliance upon Mr. Plunk’s

                                             -6-
email was error.

       Regardless of Mr. Plunk’s email, based upon the trial court’s statements, supra,
MLGW argues that the the court failed to consider MLGW’s stated purpose for the taking,
which was to relocate its facilities for current public needs and to protect rate-payers from
the expense of relocation of the facilities when later anticipated expansion of the roadway
begins. Thus, MLGW argues that the trial court misconstrued TDOT’s obligation to pay to
move the facilities by “appearing to believe that TDOT was obligated to move the facilities
only if MLGW moved its facilities within TDOT’s right-of-way.” In so doing, MLGW
argues that the trial court failed to “recognize the significance of MLGW being able to
maintain its own electric utility easement in this area, which decision was entitled to
deference by the trial court.”

        On July 15, 2011, Appellees filed a motion for fees and costs, seeking an award of
attorney’s fees and costs incurred as a result of MLGW’s efforts to condemn. MLGW
opposed the motion, arguing, in part, that the fees sought were excessive and unreasonable
in relation to the value of the property at issue. On August 29, 2011, the trial court entered
an order granting $92,782.43 in discretionary costs under Tennessee Rule of Civil Procedure
54.02 and statutory fees and costs under Tennessee Code Annotated Section 29-17-912.
Although the order granting judgment to the Appellees on the issue of condemnation was
entered on July 1, 2011, due to the pending issue of costs and fees, final judgment was not
entered until October 28, 2011.

                                         II. Issues

       MLGW appeals, raising three issues for review, as stated in its brief:

              1. Whether condemnation was mandated by MLGW’s patent
              statutory condemnation authority and the public use of the
              easements sought?

              2. Whether Appellees’ failure to prove a palpable abuse of
              power by MLGW in seeking its easements precluded the trial
              court’s usurpation of the condemning authority’s determination
              of necessity?


              3. Whether the trial court’s award of attorney’s fees was
              unreasonable given the property right sought by the condemning
              authority and the value of the property sought to be condemned?

                                             -7-
                                  III. Standard of Review

         When a motion for summary judgment is made, the moving party has the burden of
showing that "there is no genuine issue as to any material fact and the moving party is
entitled to judgment as a matter of law." Tenn. R. Civ. P. 56.04. The moving party may
accomplish this by either: (1) affirmatively negating an essential element of the non-moving
party's claim; or (2) showing that the non-moving party will not be able to prove an essential
element at trial. Hannan v. Alltel Publ'g Co., 270 S.W.3d 1, 8–9 (Tenn. 2008). However,
"[i]t is not enough for the moving party to challenge the nonmoving party to ‘put up or shut
up' or even to cast doubt on a party's ability to prove an element at trial." Id. at 8. If the
moving party's motion is properly supported, "[t]he burden of production then shifts to the
nonmoving party to show that a genuine issue of material fact exists." Id. at 5 (citing Byrd
v. Hall, 847 S.W.2d 208, 215 (Tenn. 1993)). The non-moving party may accomplish this by:
"(1) pointing to evidence establishing material factual disputes that were overlooked or
ignored by the moving party; (2) rehabilitating the evidence attacked by the moving party;
(3) producing additional evidence establishing the existence of a genuine issue for the trial;
or (4) submitting an affidavit explaining the necessity for further discovery pursuant to Tenn.
R. Civ. P. 56.06." Martin v. Norfolk S. Ry. Co., 271 S.W.3d 76, 84 (Tenn. 2008) (citations
omitted).

       When reviewing the evidence, we must determine whether factual disputes exist. In
evaluating the trial court's decision, we review the evidence in the light most favorable to the
nonmoving party and draw all reasonable inferences in the nonmoving party's favor. Stovall
v. Clarke, 113 S.W.3d 715, 721 (Tenn. 2003). If we find a disputed fact, we must "determine
whether the fact is material to the claim or defense upon which summary judgment is
predicated and whether the disputed fact creates a genuine issue for trial." Mathews
Partners, 2009 WL 3172134, at *3 (citing Byrd, 847 S .W.2d at 214). "A disputed fact is
material if it must be decided in order to resolve the substantive claim or defense at which
the motion is directed." Byrd, 847 S.W.2d at 215. A genuine issue exists if "a reasonable jury
could legitimately resolve the fact in favor of one side or the other." Id. "Summary
[j]udgment is only appropriate when the facts and the legal conclusions drawn from the facts
reasonably permit only one conclusion." Landry v. South Cumberland Amoco, et al., No.
E2009–01354–COA–R3–CV, 2010 WL 845390, at *3 (Tenn. Ct. App. March 10, 2010)
(citing Carvell v. Bottoms, 900 S.W.2d 23 (Tenn. 1995)). However, if there is any
uncertainty concerning a material fact, then summary judgment is not the appropriate
disposition. As stated by our Supreme Court in Evco Corp. v. Ross, 528 S.W.2d 20 (Tenn.
1975):

              The summary judgment procedure was designed to provide a
              quick, inexpensive means of concluding cases, in whole or in

                                              -8-
                part, upon issues as to which there is no dispute regarding the
                material facts. Where there does exist a dispute as to facts which
                are deemed material by the trial court, however, or where there
                is uncertainty as to whether there may be such a dispute, the
                duty of the trial court is clear. He [or she] is to overrule any
                motion for summary judgment in such cases, because summary
                judgment proceedings are not in any sense to be viewed as a
                substitute for a trial of disputed factual issues.

Id. at 24–25.
                       IV. The Law on Condemnation and Analysis

        Tennessee courts have long held that “the power of eminent domain is against
common right and all grants of such power are to be construed strictly against the condemnor
and liberally in favor of the rights of property.” Vinson v. Nashville, Chattanooga & St.
Louis Ry., 321 S.W.2d 841, 844 (Tenn. Ct. App. 1959.”) “Of course the power of eminent
domain is to be strictly construed and the procedure prescribed by statute must be followed.”
Id. at 844. “[T]he courts have the right and duty to determine the existence of authority to
take, the existence of legitimate public use and related questions.” Duck River Elec.
Membership Corp. v. City of Manchester, 529 S.W.2d 202, 204 (Tenn. 1975). In Pickler
v. Parr, 138 S.W.3d 210, 213 (Tenn. Ct. App. 2003), perm. app. denied (Tenn. March 8,
2004), this Court explained “the well-traveled analysis of the government’s right to take.”
The Pickler Court employed a multi-step test to determine whether a taking is appropriate.
Id. at 213. The first step is to determine whether the condemning authority has the right to
take. Id. The second step in the analysis is to determine whether the taking is for public or
private use. Id. If these questions are resolved in favor of the condemning authority, the
authority’s determination as to the need for the property is “conclusive upon the courts”
unless the opponent to the taking establishes “a clear and palpable abuse of power, or
fraudulent, arbitrary or capricious action.” Id. (quoting Maryville v. Edmondson, 931
S.W.2d 932, 935 (Tenn. Ct. App. 1996), perm. app. denied (Tenn. July 8, 1996)).

        Although the determination of whether private property is being taken for a public use
is a judicial question, “‘all other incidents of the taking are political questions, for the
determination of the sovereign, and not judicial questions, for the determination of the
courts.’” City of Knoxville v. Heth, 210 S. W.2d 326, 331 (quoting Southern Ry. Co. v.
Memphis, 148 S.W. 662, 665 (Tenn. 1912)). Deciding which property shall be taken,
“‘determining its suitableness for the use to which it is proposed . . . as well as deciding the
quantity required, are all political questions, which inhere in and constitute the chief value
of the power to take.’” Id. A municipality's determination of “the necessity for the taking
is not a question for resolution by the judiciary and, absent a clear and palpable abuse of

                                               -9-
power, or fraudulent, arbitrary or capricious action, it is conclusive upon the courts.” Duck
River, 529 S.W.2d at 204. In the context of eminent domain, a taking is arbitrary and
capricious if it “can be characterized as a ‘willful and unreasonable action without
consideration or in disregard of facts or law or without determining principle.’” City of
Chattanooga v. Classic Refinery, No. 03A01-9712-CV-00552, 1998 WL 881862, at *6
(Tenn. Ct. App. Dec. 17, 1998) (quoting Black's Law Dictionary 105 (6th ed.1990)).

                                 A. MLGW’s Right to Take

     There is no dispute in this case that MLGW has the authority to condemn property.
The Memphis City Charter, Section 684 provides:

               Memphis, Light, Gas and Water Division is hereby authorized
               and empowered to condemn any land, easements or rights of
               way, either on, under or above the grounds, for any and all
               purposes in connection with the construction, operation,
               improvement or maintenance of said electric system, gas system,
               or water system. Title to such property so condemned should be
               taken in the name of the City of Memphis. . . .

      In the instant case, Appellees do not challenge MLGW’s statutory authority to
condemn the property at issue. Rather, Appellees argue that MLGW did not satisfy the
prerequisites for condemnation, namely that the taking must be for public, not private use.

                 B. Whether the Taking is for Public or Private Use

        The construction and maintenance of electric utility lines is an established public use,
which is expressly recognized in Tennessee’s eminent domain statutes. Tenn. Code Ann. §
29-17-102(2)(B) (“Public Use” includes “[t]he acquisition of any interest in land necessary
to the function of a public or private utility. . . .”); Heth, 210 S.W.2d at 328 (“It is such a well
recognized principle that the generation and distribution of electric current, supply of water
and gas to the people is a ‘public use’ we do not deem it necessary to cite authority
therefor.”) In the instant case, the proof before the trial court was that MLGW’s facilities
had to be moved for the road improvement at the Intersection, and that the relocation of the
poles was required in order for MLGW to continue to provide utility services to the public
in that area. Accordingly, the trial court was “satisfied that even to the point of associated
use by other carriers a public purpose is stated here.”

       Appellees argued that the condemnation was inappropriate because MLGW sought
the ability to allow telecommunications and CATV carriers to have access to, and use of,

                                               -10-
MLGW’s utility poles within the easement. Consequently, Appellees argued that MLGW’s
condemnation, at least in that respect, was one for private benefit and not for public use. In
response, MLGW cites the Federal Pole Attachment Act, which provides, in relevant part,
that “[a] utility shall provide a cable television system or any telecommunication carrier with
nondiscriminatory access to any pole, duct, conduit, or right-of-way owned or controlled by
it.” 47 U.S.C. §224(f)(1). By its plain terms, the Pole Attachment Act requires MLGW to
grant telecommunication and cable companies access to its utility poles. Allowing such
access is mandatory and is not tantamount to MLGW condemning the property for private
use. Although the trial court correctly concluded that the proposed use was public, it appears
that the trial court misconstrued MLGW’s legal obligations under the Pole Attachment Act.

        The trial court interpreted the Pole Attachment Act as only prohibiting a utility from
discriminating against a carrier for access, but did not go so far as to conclude that the access
was mandatory. Based upon the word “nondiscriminatory,” as used in the Pole Attachment
Act, the trial court concluded that MLGW did not have to provide access to
telecommunication and CATV carriers. Consequently, the court held that the Pole
Attachment Act did not provide legal support for MLGW’s request to allow third parties to
use its facilities in the easement it sought. This holding is not in accord with established law.

       Courts have interpreted the Pole Attachment Act as a mandatory access provision.
See Gulf Power Co. v. United Sttates, 187 F.3d 1324 (11th Cir. 1999). As noted in Gulf
Power, when the Pole Attachment Act was first adopted, it did not require that a public utility
provide cable companies with access to its utility poles. Id. at 1326–27. However, in 1996,
the Act was amended to contain a “mandatory access provision.” Id. at 1327. The only
exceptions to the mandatory access provision are if some safety, reliability, or other
engineering problem would prevent safe access. Id. As discussed in Alabama Power Co.
v. Federal Communications Commission, 311 F.3d 1357 (11th Cir. 2002):

              As part of the sweeping changes Congress brought about
              through the Telecommunications Act of 1996, Congress
              amended the 1978 Act by giving cable companies a right of
              forced attachment. That is, power companies could not decline
              offers to attach at regulated rates, save for the statutory
              exceptions of insufficient capacity or some safety, reliability, or
              other engineering problem. This change to a forced-access
              regime was perhaps spurred by new laws, consistent with the
              1996 Act's vision of competition in all sectors of the data
              distribution business, that gave large power companies freedom
              to enter the telecommunications business rather than remain
              quarantined to the electricity business. Perhaps fearing that

                                              -11-
              electricity companies would now have a perverse incentive to
              deny potential rivals the pole attachments they need, Congress
              made access mandatory.

Id. at 1363 (internal citations and footnote omitted).

        From the foregoing, it is clear that the Pole Attachment Act mandates that MLGW
shall allow access to CATV and telecommunication providers. Accordingly, whether a cable
television or telecommunications carrier seeks to attach its facilities to MLGW’s utility poles
does not indicate that the underlying easement is sought for a private use and not a public
use.

                   C. Palpable Abuse of Power or Arbitrary Action

      Having determined that MLGW had the authority to condemn, and that the
condemnation was for public use, the taking is “conclusive on the court” absent proof from
Appellees of a palpable abuse of power or arbitrary or capricious action. In the absence of
such proof, the trial court has no authority to consider the question of necessity of the
easement.

        In the instant case, the trial court made no specific finding that MLGW acted in a
fraudulent, arbitrary, or capricious manner with regard to the condemnation. Rather, it
appears that the trial court substituted its judgment for MLGW’s in first concluding that the
separate easement was not necessary, and then in concluding that MLGW should put its
facilities within the expanded TDOT right-of-way. Consequently, the trial court’s ruling
ostensibly imposes an injunction on MLGW, requiring it to place its poles in the TDOT right-
of-way. In the absence of a finding that MLGW was acting arbitrary, capricious, or
exercising a flagrant abuse of its condemnation power, on which question the Appellees have
the burden of proof, the court’s review of the condemnation decision was limited. Thus,
because MLGW’s decision to condemn an easement was a legislative act, any review by the
courts requires “considerable deference to the decision of the governmental authority.”
McCallen v. City of Memphis, 786 S.W.2d 633, 640 (Tenn. 1990); see also Heth, 210
S.W.2d at 326 (“The determinations of ‘public use’ by the state or its agencies are entitled
to great weight or respect by the courts, since they relate to matters which should and must
have been known by the legislative branch.”). Such legislative actions “are presumed to be
valid and a heavy burden of proof rests upon the shoulders of the party who challenges the
action.” McCallen, 786 S.W.2d at 641. “[T]he court’s primary resolve is to refrain from
substituting its judgment for that of the local governmental body.” Id. The question, then,
is whether the trial court should have reached the question of necessity. In answering this
question, we must view the evidence in the light most favorable to MLGW as the party

                                             -12-
opposing summary judgment.

       Turning to the record, Appellees argued that obtaining an easement now to avoid the
cost of moving its facilities if the road is later widened constituted an impermissible future
use. Although the trial court did not specifically rule on this question, as noted in Pickler,
condemnation for a later, identified need is not a “future use.” Pickler, 138 S.W.3d at
213–14. Consequently, this argument is not sufficient to shift the burden on summary
judgment to MLGW.

        Appellees’ primary argument in support of its contention that MLGW acted arbitrarily
in seeking the condemnation is that Appellees deeded sufficient property to TDOT to allow
MLGW room to place its facilities in the TDOT right-of-way. However, contrary to
Appellees’ assertion, their transfer of property to TDOT to establish a new right-of-way
could not unilaterally destroy MLGW’s existing property rights in this property. Rather, the
gifted property was subject to MLGW’s existing easement. As noted, the deeds making the
gift did not include language that MLGW’s facilities were to be maintained in the gifted
right-of-way. In fact, there is no mention whatsoever of MLGW in these deeds. Thus, we
cannot read the deeds, granting TDOT’s extended easement, to compel MLGW to place its
facilities in TDOT’s right-of-way. MLGW never consented to have its poles placed in the
TDOT right-of-way, and, in fact, TDOT’s plan and design for the renovation of the
Intersection showed that MLGW expected its poles to be placed in a separate easement,
outside of TDOT’s right-of-way. This plan is further evidenced in the express language
found in the Utility Relocation Contract entered between TDOT and MLGW, which requires
MLGW to “acquire all utility rights-of-way outside of the available public right-of-way as
may be needed to relocate its utility facilities. . . . [MLGW] agrees to acquire these rights-of-
way at no cost to TDOT. . . .”

       In its bench ruling, the trial court stated that it “read with considerable interest” the
deposition of William Goss to determine that a separate easement to MLGW was not
necessary because MLGW could place its facilities in TDOT’s right-of-way. The portion of
Mr. Goss’ testimony that the court relies upon is as follows:

              Q. Are you aware of any policy at MLGW today which would
              preclude—a written policy now—a written policy of MLGW
              which would preclude it from locating its utility poles within the
              TDOT right-of-way at Highway 70 and Canada Road?

              A. No, I am not aware of any written policy; however, because
              of my relationship with MLGW through Shelby County
              government and working on other road widening projects,

                                              -13-
              MLGW currently has a policy, though it’s probably unwritten at
              this day, the operational policy, and if their—if MLGW’s
              facilities are within an easement, then MLGW requires that the
              adjusted facilities also be within an easement.
                      And the rationale for that is that, as long as they’re in an
              easement, that any subsequent widening of the roadway, that
              MLGW would be paid by the government, whether it’s
              municipal, county or state, 100 percent for adjusting their
              facilities; whereas, if the facilities are not within an easement
              but just in a road right-of-way, then any subsequent adjustments
              would be at MLGW’s expense.

Mr. Goss further testified that, when he was employed at MLGW and it was necessary to
move poles for improvements, MLGW worked to ensure that its facilities remained within
MLGW’s existing easements “because any subsequent widening, we would still be in an
easement and we would get paid 100 percent for any subsequent adjustment.” Rather than
supporting the trial court’s position, Mr. Goss’ testimony clearly supports the justification
that MLGW has relied upon throughout these proceedings—that maintaining its own
easement is necessary in order to defer future costs of relocation. MLGW has had an
easement for poles in this area for over fifty years. Because of changes to the Intersection,
it is undisputed that MLGW must now move the poles for the public need of continuing to
provide power to residents in the Lakeland area. It is also undisputed that, if MLGW’s poles
are located within their own easement, then TDOT must bear the expense of moving
MLGW’s facilities should that need arise. Costs of relocation are expensive; in this case,
they are estimated in excess of $200,000.00. If MLGW’s poles are placed within TDOT’s
extended right-of-way, as suggested by the trial court, then the costs of relocating the poles
for future road improvements would be born by MLGW and, subsequently, by its ratepayers.
As Mr. Goss conceded “[it is] very logical for MLGW to want to keep itself within an
easement so that it minimizes expense for its rate payers. . . .” This purpose is logical, and
we conclude that Mr. Goss’ testimony does not meet Appellees’ “heavy burden” to show that
MLGW’s attempted condemnation was a palpable abuse of power or an arbitrary or
capricious action.

      D. The Trial Court’s Ruling is Contrary to Existing Condemnation Law

       In reaching its conclusion that a separate easement was not necessary and that MLGW
could use TDOT’s right-of-way for its poles, the trial court substituted its own judgment of
necessity for that reserved to the legislative branch, thus exceeding its authority. In Dep’t
of Highways v. Stepp, 266 S.W. 776 (Tenn. 1924), the court held that where the
condemnation was with authority and for a public purpose the landowner could not “contest

                                             -14-
such questions as the utility of the improvement, the choice of route, and the necessity for
taking, because these are legislative questions which the courts cannot review.” Id. at 777.
Rather, the court’s review is limited where no fraud or palpable abuse of power has occurred.
Id. The term “palpable abuse of power” is said to be an abuse of discretion, delegated by the
Legislature, by an attempted appropriation in utter disregard of the possible necessity for its
use, or a use of the power as the cloak of some sinister private scheme.” Id. at 777–78.
Similar to the case at bar, in Stepp, the landowners put on proof that there was a more
suitable location for the proposed roadway and that it would cost less to construct it in a
different area. As to this argument, the Tennessee Supreme Court explained:

              Such a controversy between the landowner and the agency of the
              state seeking to take land for public use cannot be treated as a
              litigious issue of fact, otherwise every condemnation proceeding
              would involve a long sharp controversy between the landowner
              and the state, not only as to whether the taking was for the
              public good, but as to the choice of a location with the ultimate
              choice lodged in a jury.

Id. at 778. As further noted by the court in Kingsport Utilities, Inc. v. Steadman, 139 F.
Supp. 622 (E.D. Tenn. 1956):

              [The power of eminent domain] would be a vain and empty
              thing if the owner could contest the advisability of taking his
              property rather than his neighbor’s, or if he could interpose as a
              defense to the taking that other property could be found which
              would suit the public purposes better, or that he, the owner, was
              of the opinion and could prove that the public needed more or
              less the quantity proposed to be taken. The power to take would
              be of small value, if the thing to be taken, in its quantity, quality,
              and locality, could be determined by another and adverse
              interest.

Id. at 624 (quoting Southern Ry., 148 S.W. at 665). Accordingly, the trial court did not have
the authority to address Appellees’ argument that it was better for MLGW to locate its poles
within TDOT’s right-of-way rather than within its own, separate easement.

       The trial court further erred when it considered the necessity for the easement. In
reaching this question, the trial court relied upon the case of City of Chattanooga v. Classic
Refinery, Inc., No. 03A01-9712-CV-00552, 1998 WL 881862, (Tenn. Ct. App. Dec. 17,
1998), for its authority. In Classic Refinery, the court analyzed the necessity of the taking

                                              -15-
solely because the purpose and scope of the public taking was misstated in the petition, thus
making the proposed condemnation arbitrary and capricious. In Classic Refinery, the
condemnation was sought for the public purpose of constructing a stadium. Id. at *1, *5.
For purposes of the stadium, the City of Chattanooga attempted to condemn a commercial
building for a parking lot near the stadium. Id. at *2. By the time the petition to condemn
the commercial building was filed, the stadium was complete and in use. Id. at *5–*6.
Therefore, the court concluded that the expressed “public purpose” of constructing a stadium
was not sufficient for the taking. Thus, condemning property for the stated purpose of
building a stadium that was already complete was arbitrary and capricious. Id. at *8. Having
determined that the purpose was arbitrary and capricious, under the foregoing principles, the
door was opened to evaluate the necessity of the taking. Id. The Classic Refinery Court
suggested that, upon remand, the city be given the opportunity to amend its petition to state
a valid public purpose for the taking. Id.

        The Classic Refinery case is clearly distinguishable from the instant appeal. Here, the
stated public purpose is a valid public purpose—i.e., MLGW must move its facilities to allow
it to continue to provide utilities to ratepayers in the area. MLGW wishes to relocate its
facilities on property where it maintains a valid easement. This decision is not arbitrary;
rather, it is made for a valid business reason, which is to avoid having to pay costs of any
future relocations. Regardless, once the trial court concluded that there was a valid public
purpose for the easement, there was no need for it to inquire further as to necessity. The
Classic Refinery case did not open the door to judicial scrutiny of the necessity of every
easement sought by condemnation.

        The evidence shows that MLGW had the authority to condemn, and that the taking
was for a public purpose. However, the evidence fails to satisfy Appellees’ heavy burden on
the question of whether MLGW’s condemnation was a clear and palpable abuse of power,
or was otherwise fraudulent, arbitrary or capricious. In the absence of such a finding, the
trial court exceeded its authority in considering the question of necessity and ostensibly
enjoining MLGW to relocate its facilities in TDOT’s expanded right-of-way. Because the
trial court’s grant of summary judgment was prefaced on its finding concerning necessity of
the easement, we must reverse the grant of summary judgment in favor of Appellees. The
undisputed evidence shows that MLGW had the right to condemn the Appellees’ property,
and that the condemnation was for the public purpose of providing utilities in that area. The
evidence does not show that MLGW’s motive in this taking was fraudulent, or that it was
arbitrary or capricious. In the absence of this showing, the court has fulfilled its role and the
taking should be allowed. Based upon the record, we conclude that motion of MLGW for
condemnation, appropriation, and possession should have been granted by the trial court.

                               V. Attorney’s Fees and Costs

                                              -16-
        An award of attorney’s fees is reviewed under an abuse of discretion standard.
Wright v. Wright, 337 S.W.3d 166, 176 (Tenn. 2011). An abuse of discretion occurs where
the trial court “‘applied incorrect legal standards, reached an illogical conclusion, based its
decision on clearly erroneous assessment of the evidence, or employ[ed] reasoning that
causes an injustice to the complaining party.’” Id. (quoting Konvalinka v. Chattanooga-
Hamilton County Hosp. Auth., 249 S.W.3d 346, 358 (Tenn. 2008). In the instant case, the
trial court applied an incorrect legal standard. Specifically, MLGW had the right to
condemn, and was doing so for a public purpose. Because Appellees evidence fails to meet
the “heavy burden” to show that MLGW’s taking was arbitrary or capricious, the taking is
“conclusive upon the court.” In substituting its own judgment for MLGW’s on the issue of
necessity, the trial court exceeded its authority. Because the grant of summary judgment to
Appellees’ was in error, we conclude that the award of attorney’s fees and costs to Appellees
was, likewise, error. Accordingly, we reverse this award.

       For the foregoing reasons, we reverse the order of the trial court, granting summary
judgment in favor of Appellees. We also reverse the award of attorney’s fees and costs to
Appellees. The case is remanded for entry of judgment in favor of MLGW for
condemnation, appropriation and possession, for assessment of the fair value of the
condemned property, and for such further proceedings as may be necessary and are consistent
with this opinion. Costs of this appeal are assessed to the Appellees, Tandy J. Gilliland
Family, L.L.C., Tandy J. Gilliland and Rudolph Jones, Jr., L.L.C., and Tandy Jones Gilliland,
Trustee of Callis Brunswick Trust, for all of which execution may issue if necessary.




                                                    _________________________________
                                                    J. STEVEN STAFFORD, JUDGE




                                             -17-
