                 IN THE COURT OF APPEALS OF TENNESSEE
                             AT NASHVILLE
                                    April 13, 2005 Session

   STATE OF TENNESSEE, ET AL. v. WANDA DEAN WALLACE, ET AL.

                   Appeal from the Circuit Court for Montgomery County
                            No. 50200336     Ross Hicks, Judge


                  No. M2004-00846-COA-R3-CV - Filed December 20, 2005


The State of Tennessee appeals the assessment of discretionary costs in an eminent domain action.
The property owner was awarded her discretionary costs after the jury awarded her damages in
excess of that tendered by the State. The State contends it is exempt from discretionary costs in
eminent domain actions. We agree.

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

FRANK G. CLEMENT , JR., J., delivered the opinion of the court, in which PATRICIA J. COTTRELL, J.,
and DONALD P. HARRIS, SR. J., joined.

Paul G. Summers, Attorney General & Reporter; Michael E. Moore, Solicitor General; and Sharon
G. Hutchins, Assistant District Attorney General, for the appellee, State of Tennessee, on relation
of the Commissioner of the Department of Transportation.

James W. Fisher, Jr., Goodlettsville, Tennessee, for the appellee, Wanda Dean Wallace and
Montgomery County, Tennessee (for tax purposes only).

                                            OPINION

         Wanda Wallace owned a strip of land that was situated along one of the State’s highway
projects in Montgomery County, Tennessee. The project necessitated the acquisition by the State
of a strip of Ms. Wallace’s property and, in addition thereto, a temporary construction easement over
another portion of her property. The State filed this action, in an exercise of its power of eminent
domain, to acquire the requisite rights to Ms. Wallace’s property. Although the taking by the State
did not involve a substantial amount of property relative to the amount owned by Ms. Wallace, it
significantly affected the remainder of her property.

       An appraiser engaged by the State valued Ms. Wallace’s property at $13,000. The State
deposited that amount with the court following the commencement of this action. Ms. Wallace
engaged the services of an appraiser who valued the property taken by the State in excess of $13,000.
Not being satisfied with the amount tendered by the State, Ms. Wallace demanded a jury trial to
establish the compensation to which she was entitled.

        The trial took place in November of 2003. The jury returned a verdict of $1,598 for the value
of the property taken and an additional $13,402 for incidental damages to the remaining property.1
Following the trial, Ms. Wallace sought to recover discretionary costs. The trial court awarded Ms.
Wallace, as discretionary costs, the following expenses: the court reporter’s appearance fee of $250,
her appraiser’s fee of $2,400 for two days of testimony, and her appraiser’s fee of $3,000 for
preparation of the appraisal report, for a total of $5,650.2 The State appeals contending it is exempt
from discretionary costs in eminent domain actions.3

                                              STANDARD OF REVIEW

       The issue before us involves the interpretation of a statute and a rule of civil procedure, the
construction of which are questions of law. The standard of review for questions of law is the de
novo standard. Gleaves v. Checker Cab Transit Corp., Inc., 15 S.W.3d 799, 802 (Tenn. 2000).

        The primary rule of statutory construction is "to ascertain and give effect to the intention and
purpose of the legislature." Carson Creek Vacation Resorts, Inc. v. Dep’t of Revenue, 865 S.W.2d
1, 2 (Tenn. 1993); McGee v. Best, 106 S.W.3d 48, 64 (Tenn. Ct. App. 2002). Our duty is to seek a
reasonable construction “in light of the purposes, objectives, and spirit of the statute based on good
sound reasoning." Scott v. Ashland Healthcare Ctr., Inc., 49 S.W.3d 281, 286 (Tenn. 2001), citing
State v. Turner, 913 S.W.2d 158, 160 (Tenn. 1995). To determine legislative intent, we must look
to the natural and ordinary meaning of the language in the statute. We must also examine any
provision within the context of the entire statute and in light of its over-arching purpose and the goals
it serves. State v. Flemming, 19 S.W.3d 195, 197 (Tenn. 2000); T.R. Mills Contractors, Inc. v. WRH
Enters., LLC, 93 S.W.3d 861, 867 (Tenn. Ct. App. 2002). The statute should be read "without any
forced or subtle construction which would extend or limit its meaning." Nat’l Gas Distribs., Inc. v.
State, 804 S.W.2d 66, 67 (Tenn. 1991).

        We are to "give effect to every word, phrase, clause and sentence of the act in order to carry
out the legislative intent." Tidwell v. Collins, 522 S.W.2d 674, 676-77 (Tenn. 1975); In re Estate
of Dobbins, 987 S.W.2d 30, 34 (Tenn. Ct. App. 1998). We must also presume the General Assembly
selected their words deliberately, Tenn. Manufactured Hous. Ass'n. v. Metro. Gov't., 798 S.W.2d
254, 257 (Tenn. Ct. App. 1990), and the use of their words conveys some intent and carries meaning


        1
         The jury neglected to award compensation for the temporary construction easement. As a consequence,
W allace moved for a new trial. At the hearing on the motion the trial court suggested an additur of $1,550 for
compensation for the easement, which the State accepted.

        2
          Ms. W allace also incurred the appraiser’s fee to prepare for the deposition and trial. She did not seek
discretionary costs for these expenses.

        3
            The issues on appeal are limited to the award of discretionary costs.

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and purpose. Tennessee Growers, Inc. v. King, 682 S.W.2d 203, 205 (Tenn. 1984); Clark v. Crow,
37 S.W.3d 919, 922 (Tenn. Ct. App. 2000).

                               PREPARATION OF THE APPRAISER ’S REPORT

        Tennessee Rule of Civil Procedure 54.04 provides that the “costs included in the bill of costs
prepared by the clerk shall be allowed to the prevailing party unless the court otherwise directs, but
costs against the state, its officers, or its agencies shall be imposed only to the extent permitted by
law.” Tenn. R. Civ. P. 54.04(1). It further provides:

         Costs not included in the bill of costs prepared by the clerk are allowable only in the
         court’s discretion. Discretionary costs allowable are: reasonable and necessary court
         reporter expenses for depositions or trials, reasonable and necessary expert witness
         fees for depositions and trials, reasonable and necessary interpreter fees for
         depositions and trials, and guardian ad litem fees; travel expenses are not allowable
         discretionary costs. . . .

Tenn. R. Civ. P. 54.04(2). (emphasis added)

        Although the prevailing party may recover, as discretionary costs, necessary expert witness
fees for depositions and trials, Tenn. R. Civ. P. 54.04(2), not all fees charged by an expert witness
may be recovered as discretionary costs. For example, prevailing parties cannot recover expert
witness fees for preparation. Massachusetts Mut. Life Ins. Co. v. Jefferson, 104 S.W.3d 13, 38 (Tenn.
Ct. App. 2002). Moreover, fees charged by an expert witness for “preparing” for depositions or trial,
“no matter how reasonable and necessary,” are not recoverable as discretionary costs. Id. (citing
Miles v. Marshall C. Voss Health Care Center, 896 S.W.2d 773, 776 (Tenn. 1995)(other citations
omitted)). As the Supreme Court has explained, an expert’s fee for his trial testimony was an
appropriate discretionary cost under Rule 54.04, but the expert’s fee for evaluating an employee’s
disability was not. Miles v. Marshall C. Voss Health Care Ctr., 896 S.W.2d 773, 776 (Tenn. 1995).

        The discretion afforded the court under subsection (2) of Rule 54.04 is limited. Rule
54.04(2) does not afford the court the discretion to award costs other than or in addition to those
specified in subsection (2). Discretionary costs allowable under Rule 54.04(2) are court reporter
expenses for depositions or trials, expert witness fees for depositions and trials, interpreter fees for
depositions and trials, and guardian ad litem fees. Moreover, the court’s discretion relative to the
fees of an expert witness is limited to “fees incurred for actual deposition or trial testimony.”
McMurry v. Metro. Gov’t of Nashville, 2003 WL 535918 (Tenn. Ct. App. Feb. 26, 2003)(holding
the trial court was correct to award fees for expert testimony and to disallow fees for trial
preparation)(citing Shahrdar v. Global Hous., Inc., 983 S.W.2d 230, 239 (Tenn. Ct. App. 1998)).4


         4
           Note however that some experts are furnishing reports, which are stipulated by adversaries to be accurate and
truthful; thereby avoiding the necessity of a deposition of the expert. The 2004 amendment to Rule 54.04(2) permits
                                                                                                           (continued...)

                                                          -3-
         The trial court assessed the appraiser’s fee for the preparation of his appraisal as
discretionary costs against the State. A written appraisal by an appraiser is the equivalent of a report
by an expert. Rule 54.04(2) does not authorize the assessment of a fee for the preparation of an
expert’s report. Therefore, it was error for the trial court to assess as discretionary costs the
appraiser’s fee for preparing his appraisal.

                        DISCRETIONARY COSTS ASSESSED AGAINST THE STATE

       The statutory power to assess costs against the State is in derogation of the State’s
sovereignty and must be strictly construed. Matter of Harris, 849 S.W.2d 334, 336 (Tenn.
1993)(citing State ex rel. Chanaberry v. Stooksbury, 145 S.W.2d 775, 776 (Tenn. 1940)). As a
consequence, imposition of costs against the State may not be implied; it must be expressed.
Tennessee Small School Systems v. McWherter, 1993 WL 295006, *3 (Tenn. Ct. App. Aug. 4, 1993).
Moreover, authority to assess costs against the State cannot be implied from general statutes
authorizing the imposition of costs. Id.

        Tennessee Code Annotated § 29-17-812 authorizes the recovery of certain costs against the
condemnor when the amount of compensation awarded at trial exceeds that deposited with the clerk
of court.5 The statute specifically authorizes the bill of costs, as prepared by the clerk, to be assessed
against the condemnor; however, the statute defers to Rule 54.04 for the assessment of any additional
(discretionary) costs. Tenn. Code Ann. §29-17-812.

        Although Rule 54.04(2) permits the assessment of discretionary costs against the State to the
extent assessment of such costs is “permitted by law,” State of Tennessee v. Parsons, 1992 WL
389166, *3 (Tenn. Ct. App. Dec. 31, 1992), the rule, standing alone, does not expressly authorize
the assessment of discretionary costs against the State. Tennessee Small School Systems v.
McWherter, 1993 WL 295006, at *5. As a consequence, courts look to applicable statutes, if any,
to determine whether the assessment of discretionary costs against the State is expressly authorized.
See Phillips v. Tennessee Technological Univ., 984 S.W.2d 217, 218-19 (Tenn. 1998)(denying the
recovery of discretionary costs in a workers’ compensation action based upon the conclusion the
applicable workers’ compensation statute did not expressly authorize the assessment of discretionary
costs against the State).

        This court upheld the assessment of discretionary costs against the State in a condemnation
action. Parsons, 1992 WL 389166. We affirmed the assessment of discretionary costs against the
State based upon Tennessee Code Annotated § 29-17-812(a) which then provided: “If the amount


         4
          (...continued)
recovery of “related expenses” as discretionary costs. See Advisory Commission Comment to 2004 Amendment.

         5
          The State contends the statute does not apply to it because the statute uses the word “condemnor” instead of
“state.” W e find no merit to this argument based upon the holdings in State of Tennessee v. Parsons, 1992 W L 389166,
*3 (Tenn. Ct. App. Dec. 31, 1992) and Tennessee Small School Systems v. McWherter, 1993 W L 295006, at *5 (Tenn.
Ct. App. Aug. 4, 1993).

                                                         -4-
of compensation awarded on the trial shall exceed the amount assessed by the condemnor, the
condemnor shall pay all the costs of the case. . . .”6 Parsons, 1992 WL 389166, at *3 (emphasis
added)(citing Tenn. Code Ann. § 29-17-812(a)). The holding in Parsons turned on the combined
effect of Tenn. R. Civ. P. 54.04(2) and Tennessee Code Annotated § 29-17-812(a). As the court
explained,

        had it been the intention of the Rules to relieve the State of liability under Tennessee
        Rule of Civil Procedure 54.04 costs, it would have simply provided that costs may
        not be assessed against the State pursuant to Rule 54.04. The Rule does not so
        provide. So we must look to what is, in fact, “permitted by law.”

Parsons, 1992 WL 389166, at *3.

        The key element in the assessment of discretionary costs in Parsons was not Rule 54.04(2);
it was Tennessee Code Annotated § 29-17-812(a). See McWherter, 1993 WL 295006 at *5
(explaining the Parsons court looked to Tennessee Code Annotated § 29-17-812(a) and not to Rule
54.04 to determine whether discretionary costs could be assessed against the State). The statute
expressly mandated that “the condemning authority ‘shall pay all costs of the case’ where the amount
of compensation awarded for the condemned property exceeds the amount originally assessed.”
McWherter, 1993 WL 295006 at *5 (quoting Tenn. Code Ann. § 29-17-812). The key element,
however, is no longer in the statute. It was removed by a 1994 amendment. See 1994 Tenn. Pub.
Acts ch. 931, §1. As a consequence, Tennessee Code Annotated § 29-17-812(a) no longer provides
that the condemning authority shall pay “all of the costs.” It now provides “[i]f the amount of
compensation awarded at the trial shall exceed the amount assessed by the condemner and deposited
with the clerk, then the bill of costs prepared by the clerk shall be taxed against the condemner. . .
.” Tenn. Code Ann. § 29-17-812(a)(1).

        The power to assess costs against the State is in derogation of the State’s sovereignty, and
statutory authorization to impose costs against it may not be implied, it must be express. With the
1994 amendment to Tennessee Code Annotated § 29-17-812, we no longer have express authority
to assess costs, other than the clerk’s bill of costs, against the State. There being no express authority
to assess Ms. Wallace’s discretionary costs against the State, we must vacate the award of
discretionary costs of $5,650 against the State.




        6
            The statute was amended in 1994 and the quoted section was deleted.

                                                         -5-
                                        IN CONCLUSION

       The award of discretionary costs of $5,650 against the State is vacated, and this matter is
remanded for entry of a judgment consistent with this opinion. Costs of appeal are assessed against
appellee, Wanda Wallace.



                                                      ___________________________________
                                                      FRANK G. CLEMENT, JR., JUDGE




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