Order Denying Motion For Preliminary Injunction Seascape Properties

ELECTRONICALLY FILED - 2021 Jan 25 2:27 PM - HORRY - COMMON PLEAS - CASE#2020CP2607070
STATE OF SOUTH CAROLINA ) IN THE COURT OF COMMON PLEAS

COUNTY OF HORRY ) FIFTEENTH JUDICIAL CIRCUIT
)
Horry County, ) CIVIL ACTION NO. 2020-CP-26-07070
)
Plaintiff, )
vs. ) ORDER DENYING MOTION FOR
) PRELIMINARY INJUNCTION AND
City of Myrtle Beach, ) DISSOLVING TEMPORARY
) RESTRAINING ORDER
Defendant. )
)
This matter is before the Court on the Motion for Preliminary Injunction (“Motion”) of
Plaintiff Horry County (“County”) seeking to enjoin Defendant City of Myrtle Beach (“City”)
from conveying certain real property pursuant to ordinances validly adopted by its governing body,
Myrtle Beach City Council (“City Council”). The Court held a videoconference hearing on this
motion on January 5, 2021. Having fully considered the Motion, verified complaint, memoranda
of law and incorporated exhibits supporting and opposing the Motion submitted by the parties,
relevant case law and statutes, and argument of counsel, for the reasons set forth below the Court
DENIES the Motion and DISSOLVES the temporary restraining order heretofore issued by the
Court.
INTRODUCTION
This matter involves the County’s action filed December 10, 2020, pertaining to certain
real property owned by the City which the parties have referred to as the “Seascape Properties.”
Asserting in its verified complaint that it holds a “beneficial interest in and equitable title to the
Seascape Properties,” the County obtained an ex parte temporary restraining order from this Court
on December 22, 2020, by which the City was temporarily restrained from selling the Seascape
Properties pursuant to separate contracts approved in ordinances adopted by City Council on
December 8, 2020. Because the temporary restraining order was issued ex parte, the Court was
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necessarily not cognizant of, and thus did not consider, many of the facts and arguments presented
by the City in its January 4, 2021 written opposition to the Motion and at the January 5, 2021
hearing. Having now considered these facts and arguments, the Court concludes that the Motion
must be denied. The County lacks any legal title interest in the Seascape Properties and has, in
fact, entered into an agreement to resolve all prior disputes between it and the City involving these
properties. That agreement, while entitling the County to receive a portion of rental proceeds from
leases the City has given on the Seascape Properties and to use these proceeds as the County sees
fit, does not create any beneficial or equitable interest in the properties that would entitle the
County to prevent the sale of, or receive any proceeds from the sale of, these properties. Nor does
it entitle the County to require that the City continue to lease these properties. Accordingly, and
as explained in detail below, the Court finds that the County has failed to meet its burden of
establishing the five elements which are required for this Court to preliminarily enjoin the City.
FACTUAL/PROCEDURAL BACKGROUND
A detailed recitation of how the City came to own the Seascape Properties, and subsequent
events culminating in the 2004 Intergovernmental Agreement (“2004 Agreement”) between the
City and County that controls this matter, is necessary to understand the Court’s disposition of the
Motion.
In 1948, the City received a quitclaim deed from the Federal government under the Surplus
Property Act of 1944 for the Seascape Properties, which are situated between South Kings
Highway and the Atlantic Ocean in the unincorporated area of Horry County. A portion of the
property had previously been used as an Army air base. Included in this quitclaim deed was the
condition that the City use these properties “for public airport purposes” and that they not “be used,
leased, sold, salvaged or disposed of [by the City] for other than airport purposes without the
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written consent of the [Federal] Civil Aeronautics Administrator.” Compl. ¶¶ 6-7, Compl. Ex. A,
Deed, at 8, 10 (emphasis added). Thereafter, the City opted to construct the Myrtle Beach
Municipal Airport elsewhere but still use the Seascape Properties to support these airport
operations. Compl. Ex. B, 1953 Resolution, at 1. In 1953, City Council, for the purpose of
obtaining “marketable fee title” to the Seascape Properties in light of the airport’s new location,
consequently passed a resolution to “utilize any revenue derived from the use, lease, or
disposition of the said two tracts of land for public airport purposes” in exchange for being
released from the condition in the 1948 deed regarding use of the Seascape Properties as an airport.
Id. at 1 (emphasis supplied). Approximately three weeks later, the Federal government provided
that release. Compl. Ex. C, 1953 Release, at 2. Thus, the City was no longer obligated to use the
Seascape Properties as a public airport, but only to use revenues derived from its use, lease, or
disposition to support a public airport.
Five years later, in April of 1958, the City, the Federal government, and the South Carolina
Aeronautics Commission (“Commission”) entered into a contract which provided for the City’s
conveyance of the property then comprising the Myrtle Beach Municipal Airport to the Federal
government for the purpose of “development of a military project known as Myrtle Beach Air
Force Base.” Compl. Ex. D at 1. In exchange for this conveyance, the Federal government agreed
“to construct and develop substitute facilities” to accommodate a relocation of the “civil air
operations” from the Myrtle Beach Municipal Airport to the “Crescent Beach Airport.” Id. at 1,
Recitals and Art. I. § a. The Federal government and the Commission agreed that the City’s
contribution of “all funds presently available and which may become available in the Airport Fund
representing proceeds received by the City from [the Seascape Properties]” would be only for the
limited purposes of supporting “the operation, maintenance and development of the Myrtle Beach
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Airport at Crescent Beach.” Compl. Ex. D, April 1958 Agreement, at 2, Art. I, § f (emphasis
added).
Approximately five months later, in October of 1958, the City, the Commission, and the
Federal government entered into another agreement which confirmed that the April 1958
agreement “constitute[d] a complete release of the City from its obligations with respect to the
Myrtle Beach Airport” under any prior deed or grant. Compl. Ex. E, October 1958 Agreement, at
2. By this agreement, the Commission also committed to undertake the operation of the Crescent
Beach Airport for 20 years, and the City reaffirmed its agreement to provide income from the
Seascape Properties to the Commission for that purpose. Id. at §§ II(B), III. Thus, the only airport
operations ever funded by the City or operated by the Commission under this agreement was the
commercial airport operations then ongoing at the Crescent Beach Airport.
The City appears to have begun leasing the Seascape Properties at least by 1963, see Horry
County v. City of Myrtle Beach, 288 S.C. 412, 414, 343 S.E.2d 36, (Ct. App. 1986), and to have
continued leasing them since then.1 Id.; Compl. at 4, ¶ 15. Currently, the Seascape Properties are
leased to the proposed purchasers, who have operated them as campgrounds since 1990. Opp. Ex.
M at 4.
In 1974, ownership of the Crescent Beach Airport appears to have been transferred by the
Commission to the County. Compl. at 3, ¶ 14. In 1976, commercial airport operations ceased
Although not cited in the Motion, the County asserted during the hearing that this and
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another Court of Appeals decision, Johnston v. City of Myrtle Beach, 285 S.C. 453, 330 S.E.2d
321 (Ct. App. 1985), had some bearing on the Motion vis-à-vis the County’s assertion that a trust
has been established by the City for the benefit of the County. However, as reflected in these
appellate decisions and City Opposition Ex. K, these decisions deal with standing and notice
requirements for passing municipal ordinances, and not substantive issues involving the existence
of a trust or any obligations of the City to the County with respect to the Seascape Properties. They
are therefore inapposite with respect to this Court’s consideration and determination of the Motion.
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being conducted by the County at the Crescent Beach Airport and those operations commenced at
the current Myrtle Beach International Airport location. City Opp. Ex. K, County Investigation
Request to Federal Aviation Administration (“FAA”) ¶¶ 7-8. The Commission’s 20-year term to
operate the Crescent Beach Airport under the October 1958 agreement expired in 1978, and the
County has since undertaken its operation as a general aviation facility, having changed its name
to “Grand Strand Airport.” Id. “During the 1980s the County and City engaged in litigation
dealing mostly with the City’s [alleged] improper use of State law procedures to procure and
execute lease agreements for the Seascape Property.” Id. at ¶ 9; see discussion, supra, n. 1. Other
disputes between the County and City regarding revenues from the leases on the Seascape
Properties continued to be litigated, including a 1982 civil action brought by the County in the
United States District Court which was dismissed due to a lack of jurisdiction after the Federal
government disclaimed any interest in them adverse to the County. Id.
While the Seascape Properties continued to be under lease and generating rental income,
in 1995 the City Council adopted a resolution establishing the “Airport Trust Fund,” into which
“income generated” from the Seascape Properties was to be placed which, along with the corpus
of that fund, was to be used “only for capital improvements which directly relate to the
development, operation, maintenance, or improvement of a public airport which serves the Myrtle
Beach area.” There were two exceptions to this limited use of funds on capital projects: the first
such exception was for “one-time operational requirements or promotional projects” and the
second for certain loans to the City from the corpus in “exceptional circumstances” where rental
income alone was insufficient to support “non-capital promotional projects in support of airport
operations” – such loans to be paid under “reasonable provisions … [to] reimburse the trust fund.”
City Opp. Ex. I, 1995 Resolution, at 1-2, ¶ 1-4. In so resolving, the City Council noted that it had
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been holding these revenues “in trust … for the benefit of the citizens of Myrtle Beach” and that
it had “traditionally restricted use of money from this trust fund to capital projects related to airport
functions, with the recent exceptions related to promotion and development of the Myrtle Beach
Jetport following closure of the Myrtle Beach Air Force Base.” Id. at 1. Notably, this resolution
did not specify that expenditures from the Airport Trust Fund would be made on any facility owned
by the County, but only “a public airport that serves the Myrtle Beach area.” Id. at 1, ¶ 2.
In 2001, the County requested that the Attorney General of South Carolina investigate the
City’s finances relating to the “Airport Trust Fund” created by the 1995 resolution, which request
was referred to the State Law Enforcement Division (SLED) for a “criminal inquiry.” Compl. Ex.
F. This resulted in a finding of no criminal wrongdoing on the part of the City and no further
review of the City’s conduct.2 Id. at 3.
In November of 2002, the County requested an investigation by the FAA, which it asserted
was needed to establish that the City was obligated under various Federal statutes “to turn over
monies in [what it denominated] the Aviation Trust Fund to Horry County for the maintenance,
operation, and development of the Myrtle Beach International Airport, or any of the other airports
owned and operated by the County and serving the Myrtle Beach Area.” City Opp. Ex. K at 2, ¶
3. A stated purpose of the County in requesting this investigation was to “provide an impetus for
2
The Attorney General stated that, based on the 1995 “Ordinance (sic)” and the City’s
observance of same, “a charitable trust was most likely created with respect to the [Airport Trust]
Fund.” Compl. Ex. F at 2. He further concluded that the City should not have made two at-arm’s-
length loans to itself from the Airport Trust Fund. Id. The Court notes, however, that the 1995
Resolution found by the Attorney General to have likely created a charitable trust expressly
provided that the City could make such loans and that the Attorney General further concluded that
the City did not benefit as “the loans were made at above market value.” The Court further notes
that the Attorney General’s October 18, 2001 letter, which was addressed to the City’s mayor and
a member of County Council, does not state that the County is a beneficiary of any such trust.
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the parties to reach resolution on this issue.” Id. at 8. The City, through its City Attorney,
responded to this request in December of 2002 and therein disputed the County’s assertions. Opp.
Ex. L. Apparently, no action was taken by the FAA on the County’s request.
Less than two years after the City responded to the County’s demand for an FAA
investigation, the City and County reached an accord after “discuss[ing] a number of topics related
to the entire airport’s operation.” Compl. Ex. G, Ordinance 51-04 at 1. For the express purpose of
“resolv[ing] a number of lingering disputed positions that have remained outstanding over an
extended period of time,” on May 5, 2004, the County’s governing body, Horry County Council
(“County Council”), adopted an ordinance approving the 2004 Agreement which it found to be
“fair and equitable and in the best interests of the citizens and residents of Horry County.” Id.
(emphasis added). The 2004 Agreement recites that “for a number of years, the County … and
the City … have voiced and maintained conflicting opinions regarding the revenues the City
receives as proceeds from the rent of [the Seascape Properties]” and states that it provides “a
resolution of the ongoing dispute … as to, not only the ownership rights to the aforesaid
revenues, but also the specific uses of those funds by the County and the City.” Id., 2004
Agreement at 6 (emphasis supplied).
In the 2004 Agreement, the City and the County voluntarily agreed to equally divide a
portion of existing funds “in the Seascape Property account, formerly known as the Airport
Trust Fund” and that all “Seascape Property lease proceeds received by the City” shall be divided
with 75% going to the County and 25% going to the City. Id., 2004 Agreement, at 6-7, ¶ 2,4
(emphasis supplied). However, no restriction on the use of these proceeds, by either the County
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or the City, is contained in this agreement.3 Cf. id., 2004 Agreement at 3 (providing that future
lease proceeds will be “automatically and unconditionally divided” between the City and the
County). The 2004 Agreement neither creates for, reserves to, nor entitles the County to any
interest in sale proceeds of the Seascape Properties or in the real properties themselves. Nor does
the 2004 Agreement state any duration of time during which the City is required to lease the
Seascape Properties and provide 75% of the lease proceeds to the County or restrict the City from
selling the Seascape Properties. Importantly, however, the 2004 Agreement does contain a section
headed “Entire Agreement,” which provides that it “sets forth the full and complete
understanding of the parties as of [May 5, 2004], and [that] it supersedes and all prior
agreements and representations made earlier.” Id. at 8 (emphasis supplied).
The County alleges that, ‘[o]n or about November 6, 2020, the City informed the County
that it intend[ed] to sell the Seascape Properties for $60 million” dollars. Motion at 1. On
December 8, 2020, the City Council adopted its Ordinance Nos. 2020-048 and 2020-049 approving
3
After the hearing, the County submitted an affidavit from the Assistant Director of
Airports asserting, in part, that assurances given to the FAA in exchange for Federal funding
“require[] that revenues generated by the Department of Airports, such as the Seascape payments
described herein, must be expended exclusively for airport-specific purposes.” Aff. Judith
Olmstead ¶ 8. This overstates the assurances. As is relevant here, Assurance No. 25 requires that
“[a]ll revenues generated by the airport and any local taxes on aviation fuel established after
December 30, 1987, will be expended by it for the capital or operating costs of the airport” and for
related facilities and purposes. Id. Ex. C at p. 11 (Emphasis supplied). The lease revenues at issue
here are not generated by the airport; they are generated under a contract between the City, which
owns the property in fee, and campground operators on land not used for an airport, and a portion
of the proceeds are distributed to the County under the 2004 Agreement. The assurance also only
restricts the use of airport revenues and does not require that they continue to come from a specific
source. The Assistant Director’s affidavit further claims that the County’s portion of the lease
revenues is “pledged under the ordinances to be used exclusively for the payment of airport
Operation and Maintenance Expenses.” Id. ¶ 6. The affidavit does not cite or attach the applicable
ordinances. Regardless, this “pledge” appears to be a purely voluntary restriction by the County,
which is not binding on the City and which does not mandate that the City keep leasing the
properties.
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the sale of the Seascape Properties to the current lessees for a combined consideration of $60
Million. Compl. ¶ 24; Compl. Ex’s. H and I; Opp. Ex. M. Thereupon, the County initiated the
instant action and moved for the issuance of an ex parte temporary restraining order under Rule
65(b), SCRCP, to restrain the City from concluding the sale of the Seascape Properties, which the
Court granted by order issued on December 22, 2020, and filed December 29, 2020.4 On January
4, 2021, the City filed an opposition memorandum to the Motion and filed a motion to dismiss the
action on the ground that the County had not personally served the City with the summons and
complaint as required by Rule 4(d)(6), SCRCP. This motion was mooted by personal service of
the summons and complaint by the County upon the City on January 5, 2021. In separate Form 4
Judgment in a Civil Case orders issued immediately following the hearing on January 5, 2021, the
Court denied the City’s motion to dismiss as moot and extended the temporary restraining order
pending a ruling on the County’s motion for temporary injunction.
Based upon the foregoing facts, and an analysis of the pertinent law, the Court concludes
that the County is not entitled to a preliminary injunction and that the temporary restraining order
must therefore be dissolved.
STANDARD FOR GRANTING INJUNCTIVE RELIEF
“An injunction is a drastic remedy issued by the court in its discretion to prevent irreparable
harm suffered by the plaintiff.” Richland Cty. v. S.C. Dep’t of Revenue, 422 S.C. 292, 310, 811
S.E.2d 758, 767 (2018) (citing Scratch Golf Co. v. Dunes W. Residential Golf Props. Inc., 361
S.C. 117, 121, 603 S.E.2d 905, 907 (2004)). Therefore, it “ought to be applied with caution.”
Strategic Resources Co. v. BCS Life Ins. Co., 367 S.C. 540, 544, 627 S.E.2d 687, 689 (2006).
4
The Court, by order issued January 4, 2021, extended the temporary restraining order until
January 5, 2021, so that it could consider the Motion on that date.
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Because the City is a governmental body, the County must satisfy each of five separate elements
to enjoin the City’s sale of the Seascape Properties: (1) the County will likely succeed on the merits
of its claims; (2) the County will suffer irreparable harm if an injunction is not granted; (3) there
is an inadequate remedy at law; (4) an injunction is reasonably necessary to protect its legal rights
in the pending litigation; and (5) the City’s exercise of its statutory power to sell the properties is
arbitrary, capricious, and oppressive. See id.; Scratch Golf Co., 361 S.C. at 121, 603 S.E.2d at 908
(2004); AJG Holdings, LLC v. Dunn, 382 S.C. 43, 50-51, 674 S.E.2d 505, 508 (Ct. App. 2009),
modified on other grounds by Poynter Invs., Inc. v. Century Builders of Piedmont, Inc., 387 S.C.
583, 587, 694 S.E.2d 15, 17 (2010). For the reasons discussed below, the County has failed to
meet its burden on any of these five elements.
LAW/ANALYSIS
A. The County Has an Adequate Remedy at Law.
Irreparable harm and inadequate remedy at law “are closely related, if not identical,
concepts.” 35 Am. Jur. 2d Federal Tax Enforcement § 1054. The County recognizes as much in
the Motion, arguing only that it lacks an adequate remedy at law because the harm it allegedly will
suffer will be irreparable. Motion at 5-6. However, the only potential “harm” the County faces is
monetary—the loss of a portion of the lease revenues.5 It does not, and cannot, claim any legal
5
Although initially disclaiming that the County sought to require the City to continue
leasing the Seascape Properties in perpetuity and remit 75% of the proceeds to the County, in
addressing the Court’s questions pertaining to the existence of an adequate remedy at law through
a claim for a money judgment against the City, counsel for the County ultimately acknowledged
that this was equitable relief to which the County believes itself entitled. The Court finds that the
County is not likely to succeed on the merits of such a claim in view of the plain language of the
2004 Agreement. Perpetual contracts are disfavored under South Carolina law and will only be
enforced if the perpetual nature of the agreement is an express term. See Carolina Cable Network
v. Alert Cable TV, Inc., 316 S.C. 98, 447 S.E.2d 199 (1994). Where parties to a contract fail to
express a period for its duration, and no definite time can be implied from the nature of the
agreement or surrounding circumstances, it is terminable upon reasonable notice by either party.
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interest in the Seascape Properties themselves. See, e.g., discussion, infra, at pp. 21-22. Hence the
County brought five separate causes of action seeking the recovery of monetary damages. Compl.
¶¶ 37-66.
The County cites Grosshuesch v. Cramer, 367 S.C. 1, 623 S.E.2d 833 (2005), in support
of its assertion that it lacks an adequate remedy at law. Motion at 6. The Court finds that decision
to be inapposite. There, the Supreme Court reversed a trial court’s denial of a preliminary
injunction against caregivers and others who had transferred to themselves some $5.6 Million of
assets belonging to an elderly couple who suffered from dementia. The defendants, who were
indicted for financial exploitation of a vulnerable adult and conspiracy, had already taken
approximately $1.4 Million worth of these assets, “transferred [them] to an unknown location,”
and refused to disclose the location of “disputed assets.” Grosshuesch, 367 S.C. at 5-6 & n. 4, 623
S.E.2d at 835 & n. 4. The preliminary injunction sought there was for the purpose of “preserv[ing]
. . . $2 million worth of accounts, monies and personal property.” Id. 367 S.C. at 5, 623 S.E.2d at
835. Unsurprisingly, the Supreme Court held in Grosshuesch that a statutory attachment action
Id. In a subsequent case interpreting Carolina Cable, the Supreme Court declined to impute a
reasonableness requirement on a landlord’s refusal to allow its lessee to transfer a lease, holding
that it is a court’s function “to enforce contracts as made by the parties, not re-write or distort,
under the guise of judicial construction, the terms of an unambiguous contract.” Dobyns v. S.C.
Dep’t of Parks, Recreation & Tourism, 325 S.C. 97, 103, 480 S.E.2d 81, 84 (1997). Here, the
County cannot even claim to have a right to enforce any putative perpetual lease term as it is not a
party to the leases on the Seascape Properties. Moreover, the County failed to include in the 2004
Agreement with the City – resolving all prior disputes between them regarding the “Aviation Trust
Fund” – any requirement that the City maintain its leases of the Seascape Properties in perpetuity,
that use of rental revenues be restricted to the support of airports, or that the City never sell these
properties. Even assuming that it was the County’s desire to include all or any of these
requirements in the 2004 Agreement, it did not do so and this Court has no ability expand the
unambiguous terms of the parties’ contract. See C.A.N. Enters., Inc. v. S.C. Health & Human
Servs. Fin. Comm’n, 296.S.C. 373, 373 S.E.2d 584 (1988) (“We are without authority to alter a
contract by construction or make new contracts for the parties. Our duty is limited to the
interpretation of the contract made by the parties themselves ‘…regardless of its wisdom, folly,
apparent unreasonableness, or failure to guard their rights carefully.’”)
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was an inadequate remedy at law under those facts and that a preliminary injunction was needed
to prevent the plaintiffs’ loss of additional, identifiable assets. In contrast, here there is no question
about identifying the proceeds of a sale of the Seascape Properties or of the City absconding with
such proceeds. Grosshuesch is, thus, easily distinguishable, and therefore unpersuasive.
The County also contends that it has no adequate remedy at law because “the City’s sale
of the Seascape Properties would create a unique harm to the County, in that responsibility for
maintaining the airport would be shifted to the County’s taxpayers without the corresponding
revenue stream that is essential for airport operations.” Motion at 5-6. This argument is also
without merit, if not specious. As the Court has already noted, the 2004 Agreement is not a source
of revenue to the County that is required to be used to support its airport operations. Further, the
County’s Department of Airports receives no taxpayer funding (City Opp. Ex. A, Airports
Website), will still be profitable even without the lease proceeds from the Seascape Properties
(City Opp. Ex. B, County Budget, at 347), and has some $35 Million on hand in unrestricted assets
(City Opp. Ex. C, County Comprehensive Annual Financial Report, at 16). Moreover, if it so
desired, the County can increase the fees to users of the airport property (e.g., gate/terminal/hangar
rentals), or impose uniform service charges related to the airport’s services by travelers which it
currently imposes in lieu of relying on “County general fund taxes.” City Opp. Ex. A at 1. The
suggestion made by counsel for the County at the hearing that, without preliminary injunctive
relief, there would be a “cascading effect” forcing a financial burden onto County taxpayers is
frivolous in view of the lack of any restriction on the use of the rental revenue from the Seascape
Properties to airport operations, the excessive amounts of revenue maintained on hand by the
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County, the other revenue sources that are available to the County, and the fact that the County
does not use general fund taxes to support its airports.6
Further without merit is the County’s contention that it lacks an adequate remedy at law
because the Seascape Properties are “unique” such that allowing the City to proceed with its sales
contracts will deprive the County of the “qualities and future appreciation” in the value of these
properties. Motion at 5. At hearing, the County also contended that the unique nature of real
property is a reason why many injunctions are issued by courts of equity in matters involving
disputes over real property. In support of these contentions, the County has cited Ingels Markets,
Inc. v. Maria, LLC, LLC, No. 7:14-4828-MGL, 2016 WL 6080426 (D.S.C. Oct. 18, 2016) and
HHHunt Corp. v. Town of Lexington, 389 S.C. 623, 699 S.E.2d 699 (Ct. App. 2010). The Court
finds these cases to also be inapposite.
In Hunt, supra, the Court of Appeals held that the owners of a tract of land and residential
developer with whom they had contracted to sell that real property had demonstrated that they had
no adequate remedy at law against a municipality which was refusing to provide its water and
sewer services to the property. The Court of Appeals held in that circumstance that “because
6
The County did not reference this “cascading effect” in the Complaint or the Motion, and
it provided no specifics at the hearing. The recently-filed affidavit of the Assistant Director of
Airports does not fill this evidentiary gap. She does not claim the County will breach any
agreement with the Federal government if this revenue stream ends, and the other alleged impacts
are purely monetary, unspecified, and highly speculative. Moreover, her affidavit fails to
demonstrate that the County has no other means to raise additional revenue. Assuming she is
correct that the County cannot unilaterally increase fees or rates on airlines, parking lot operators,
or car rental agencies (see Aff. Judith Olmstead ¶ 11), the County still has the statutory right to
impose a uniform service charge on passengers using the airport. See, e.g., S.C. Code Ann. § 4-9-
30(5)(a); S.C. Code Ann. § 55-9-190(2). The Court takes judicial notice that over 2 million
passengers pass through the Myrtle Beach International Airport in an average year. Facts and
Figures – Myrtle Beach International Airport, available at https://www.flymyrtlebeach.com/
about/facts-figures/. A $1.00 per passenger fee at these volumes would cover the revenue currently
generated by the lease proceeds.
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denial of the requested services would severely restrict Appellants’ use of their property, it is
unlikely that money damages would provide an adequate remedy.” HHHunt Corp., 389 S.C. at
640-41, 699 S.E.2d at 707 (emphasis supplied).
The dispute in Ingels Markets involved a claim for a permanent injunction brought by a
shopping center “anchor” tenant to enforce certain written restrictions on outparcels in the
shopping center against the owner of the outparcels. There, the District Court concluded that the
permanent injunction was needed to enforce, inter alia, the anchor tenant’s right to an unobstructed
view of its rental premises from a nearby roadway. In that context, the District Court ruled that
the anchor tenant’s “line of site” rights under the restrictions were enforceable by injunction, and
in so doing noted that “interests in real property, including leasehold interests, are unique and
their deprivation may therefore commonly result in irreparable harm.” Ingels Markets, 2016 WL
6080426 at 7. (Emphasis supplied.) In support of this ruling, the District Court quoted from a First
Circuit opinion cited by our Court of Appeals in Hunt, supra, which quotation in pertinent part
reads as follows: “[r]eal estate has long been thought unique, and thus, injuries to real estate
interests frequently come within the ken of the chancellor.” Id. (quoting Kmart Corp. v. Oriental
Plaza, Inc., 875 F.2d 907, 915 (1st Cir. 1989) (Emphasis supplied).
Thus, in both cited cases, the rights sought to be enforced were rights arising out of an
interest in real estate held by the plaintiff. Here, the County has not shown that it holds an interest
in the Seascape Properties. To the contrary, the Complaint and its exhibits and the exhibits to the
City’s Opposition all demonstrate that (a) the County has never held any legal interest in the
Seascape Properties (either fee or leasehold), (b) that these properties are not currently utilized as
an airport, (c) that any interest which the Commission (to which the County claims to be the
successor) might arguably have held in the Seascape Properties was extinguished by the 1958
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Release the Commission gave the City in exchange for its financial support of the Crescent Beach
Airport (which property the County now owns and operates as the Grand Strand Airport), and (d)
that any claim to any interest that the County could possibly have held was expressly bargained
away by the County in 2004 when it entered into an agreement with the City to resolve all prior
disputes, including not only “the ownership rights” to the rental revenues derived from the leases
on the Seascape Properties, but also the specific uses of those revenues by the County and the City
which are not restricted in any way. See n. 5, supra.
Finally, the County’s contention that it lacks an adequate remedy at law because the $60
Million purchase price for the Seascape Properties is “less than fair market value” is without merit.
Motion at 5. The County argues that, absent injunctive relief, consummation of the sales contract
will deprive it of any “mechanism for capturing unrealized gains that would result from a sale at
market value.” This, of course, assumes that the County is entitled to participate in any such
gains—which it is not, given that the County lacks legal or equitable title to the Seascape
Properties. The City has contracted to sell the Seascape Properties for a negotiated price that is the
approximate mid-point between the value estimated by an appraisal of the Seascape Properties
obtained by the City and the value estimated appraisals of the property obtained by the purchasers.
City Opp. Ex. M, Minutes, Myrtle Beach City Council, November 10, 2020, at 4. The County
offered no appraisal of the Seascape Properties, asserting only at hearing that the fact that the City
has agreed to sell for less than the value established by its appraiser is evidence that the purchase
price is inadequate. The sale of the Seascape Properties was approved by a unanimous vote of the
Myrtle Beach City Council with a first reading on November 10, 2020, and a second reading on
December 8, 2020. Compl. ¶ 24. The Court finds that the determination of the City Council to
sell the Seascape Properties at this price is well within its authority under § 5-7-40 and beyond the
15
authority of the County to second guess or prevent. Cf. Comm’rs of Public Works v. City of
Fountain Inn, 428 S.C. 209, 833 S.E.2d 834 (2019) (holding, inter alia, that a statutory right to
operate a municipal utility system does not authorize a municipality to unilaterally undertake such
service in unincorporated areas of a county and leave county residents with no accountable elected
body). At bottom, the County’s assertion that it can control or overturn the determination of the
City Council in this regard runs afoul of § 5-7-40.
Based upon the foregoing, the Court concludes that the County clearly possesses an
adequate remedy at law as it may receive a judgment for money damages should it prevail (which,
as discussed below the Court finds unlikely) on the merits of any of its five causes of action seeking
monetary relief.
B. The County Will Not Be Irreparably Harmed If the Seascape Properties Are Sold.
The County claims that it will be irreparably harmed if the Seascape Properties are sold,
asserting that the loss of the 75% in rental revenue proceeds will cause it to have to rely upon
property taxes to support airport operations. The County’s claim in this regard is demonstrably
wrong.
As noted above, the Department of Airports does not rely upon County general tax funds
to support its operations; instead, it generates operating revenues from fees and charges derived
from its own operations and relies upon Federal and State funding for the majority of its capital
expenditures. City Opp. Ex. A at 1. The Department of Airports’ Fiscal Year 2021 Budget, of
which the Court takes notice, was adopted in June 2020 during the depths of the coronavirus
pandemic and related shutdowns, forecasts total revenues of $45.3 Million and expenses of $40.8
Million, for a net income of approximately $4.5 Million even during the pandemic. City Opp. Ex.
B, Horry County Financial Plan 2021, at 347-48. The County’s portion of lease proceeds from the
16
Seascape Properties for this fiscal year is approximately $2.7 Million.7 The Department of
Airports therefore will apparently remain profitable without any lease revenue from the Seascape
Properties. Furthermore, the Department of Airports currently holds $35.1 Million in unrestricted
assets. City Opp. Ex. C, Horry County Comprehensive Annual Financial Report, June 30, 2020,
at 16. There will be no irreparable harm to the County if the City sells the Seascape Properties.
The Assistant Director of Airport’s affidavit does not demonstrate otherwise. First, she
contends that the County’s portion of lease revenues in fiscal year 2020 “accounted for 9.28% of
the Department of Airport’s operating budget” and their loss would cause “substantial” financial
impact. Aff. Judith Olmstead ¶ 9. However, these proceeds, which the County’s budget terms
“Intergovernmental Revenues,” are non-operating revenue. City Opp. Ex. B at 347. The Assistant
Director also never specifies what the financial impact from the loss of these revenues would be.
Importantly, she does not refute the City’s observation, which is reflected in the County’s budget,
that the Department will remain profitable (i.e., continue to generate a net income) even without
the County’s portion of the lease revenues. Id. at 348. Relatedly, the Assistant Director asserts
that the County’s debt service coverage ratio would drop in the absence of these revenues, which
“could result in lower credit ratings and could lead to higher borrowing costs for the Department.”
Aff. Judith Olmstead ¶ 10 (Emphasis supplied). She offers no support for this belief, and her
language confirms that these impacts are speculative.8 And even if these harms are realized and
actionable, they are monetary in nature and not irreparable. The County therefore cannot
7
According to the Complaint, the Seascape Properties currently generate approximately
$3.6 Million annually in lease revenue, of which the County receives 75%, or approximately $2.7
Million. (Compl. ¶¶ 15, 21.)
8
The same is true for the Assistant Director’s statement that loss of the lease revenues
“could have a substantial impact on the Department of Airports and on air travel to and from
Myrtle Beach.” (Aff. Judith Olmstead ¶ 11.) She does not identify these alleged impacts or state
they are likely to occur.
17
demonstrate that it “will suffer immediate, irreparable harm without the injunction.” Compton v.
S.C. Dept of Corrs., 392 S.C. 361, 366, 709 S.E.2d 639, 642 (2011) (emphasis supplied).
C. The County has Made No Showing that the City Has Acted in an Arbitrary,
Capricious, or Oppressive Manner.
“[I]n order to receive the aid of a Court of equity to enjoin a public corporation or
department of government in the performance of actions or duties provided by statute, there must
be allegations or showing that the public department or corporation has exercised its power in an
arbitrary, oppressive or capricious manner.” Headdon v. State Highway Dep’t, 197 S.C. 118, 14
S.E.2d 586, 588 (1941). To satisfy this element for an injunction, the County must prove that the
City acted “outside its statutory duties, or that it intends to act in bad faith, arbitrarily, capriciously,
or in ‘a wantonly injurious manner.’” Richland Cty., 422 S.C. at 310, 811 S.E.2d at 767. A
governmental body’s decision may be found to be arbitrary or capricious only “if it is without a
rational basis, is based alone on one’s will and not upon any course of reasoning or exercise of
judgment, is made at pleasure, without adequate determining principles, or is governed by no fixed
rules or standards.” See Pressley v. Lancaster Cty., 343 S.C. 696, 704, 542 S.E.2d 366, 370 (Ct.
App. 2001) (citing Deese v. S.C. State Bd. of Dentistry, 286 S.C. 183, 184-85, 332 S.E.2d 539, 541
(Ct. App. 1985)).
The County made no attempt to address this mandatory element to obtain preliminary
injunctive relief in the Motion; indeed, the County did not even reference this requirement in the
Complaint, Motion for Temporary Restraining Order, or Motion for Preliminary Injunction which
challenge the City’s actions pursuant to Ordinances 2020-048 and 2020-049. Nor did the County
present evidence at the hearing which would support any argument in this regard. It merely
observed that the Complaint contains a general characterization that “[t]he City’s plan to sell the
Seascape Properties at less than fair market value and to retain the sale proceeds exclusively for
18
the City’s benefit . . . constitutes bad faith.” Compl. ¶ 42. This is unavailing, as the Court concludes
as a matter of law that the City’s conduct was neither arbitrary, capricious, nor oppressive.
The law is clear as to the County’s burden to challenge the City’s ordinances approving
the sale of the Seascape Properties:
Determining whether a local ordinance is valid is a two-step process. The first step
is to determine whether the municipality had the power to adopt the ordinance. If
no power existed, the ordinance is invalid. If the municipality had the power to
enact the ordinance, the second step is to determine whether the ordinance is
consistent with the Constitution and general law of the State.
Bugsy’s, Inc. v. City of Myrtle Beach, 340 S.C. 87, 93, 530 S.E.2d 890, 893 (2000) (citing
Diamonds v. Greenville Cty., 325 S.C. 154, 480 S.E.2d 718 (1997)). In this case, the City’s sale
of property which it owns exclusively easily satisfies the test outlined by the Supreme Court in
Bugsy’s. Section 5-7-40, entitled “Ownership and disposition of property by municipalities,”
provides that:
All municipalities of this State may own and possess property within and without
their corporate limits, real, personal or mixed, without limitation, and may, by
resolution of the council adopted at a public meeting and upon such terms and
conditions as such council may deem advisable, sell, alien, convey, lease or
otherwise dispose of personal property and in the case of a sale, alienation,
conveyance, lease or other disposition of real or mixed property, such council
action must be effected by ordinance.
Thus, the City possesses the power to both own and adopt an ordinance selling property,
so long as such disposition is accomplished by a valid ordinance. The City has done that, giving
first and second reading of the instant ordinance with public notice on November 10, 2020 and
December 8, 2020. The burden of proving the invalidity of a municipal ordinance, or in the process
used to adopt such ordinance, is on the attacking party through a showing that the municipality’s
actions were arbitrary and capricious. The County has neither attempted to satisfy nor satisfied its
burden. Nor can it. Indeed, the fact that the City informed the County that it intended to sell the
19
Seascape Properties on or about November 6, 2020 (Motion at 1) and has proceeded with publicly
noticing ordinances to approve a contract for the sale of the Seascape Properties in the normal
course and scope of its authority under § 5-7-40 is per se evidence that the City’s actions were
neither arbitrary, capricious, nor oppressive but, instead, were done properly pursuant to the City’s
statutory authority. The County’s failure to establish, much less discuss or acknowledge, this
element constitutes an independent basis upon which this Court denies the Motion.9
D. The County Has Not Demonstrated a Likelihood of Success on the Merits.
The County brought seven causes of action against the City regarding the proposed sale of
the Seascape Properties, yet it devoted just one paragraph to summarily discussing the likelihood
of success on the merits element of a claim for preliminary injunctive relief. Motion at 4-5. The
County’s brevity on this element of entitlement to injunctive relief is understandable as the very
documents on which it relies – “the deeds, contracts, resolutions, and releases that are catalogued
in the Verified Complaint,” id. – confirm that the County has not presented “the fair question”
which is needed to support an exercise of this Court’s power to enjoin. See Peek v. Spartanburg
Reg’l Healthcare Sys., 367 S.C. 450, 46, 626 S.E.2d 34, 37 (Ct. App. 2005) (“[w]hen seeking a
preliminary injunction, the plaintiff need not prove an absolute legal right; the plaintiff need only
present ‘a fair question as to the existence of such a right”) (Citation omitted).
9
Even assuming a trust exists, which the City denies and the Court does not find, the
County cites no law for the proposition that trust property must be sold at the highest appraisal
obtained by a trustee. This is perhaps because no such law exists, and such a rule would hamper
efficient and effective trust administration. “A trustee shall administer the trust as a prudent person
would, by considering the purposes, terms, distributional requirements, and other circumstances
of the trust. In satisfying this standard, the trustee shall exercise reasonable care, skill, and
caution.” S.C. Code Ann. § 62-7-804 (2009 & Supp. 2014) (Emphasis supplied). The County does
not, and cannot, allege that the City violated this standard by agreeing to sell the Seascape
Properties following arms’ length negotiations for the mid-point between competing appraisals.
The Court finds that the competing appraisals provide sufficient reason for the City’s
determination to sell the Seascape Properties for the $60 Million purchase price.
20
1. The County Has No Equitable or Beneficial Interest in the Seascape Properties.
It appears that the County’s claim to some sort of equitable or beneficial interest in the
Seascape Properties rests solely upon the Attorney General’s opinion that the City’s 1995
Resolution “likely” created a “charitable trust” in favor of the County.10 An insurmountable
difficulty with this contention is that the 1995 Resolution expressly states the City Council
previously held the income derived from the Seascape Properties “in trust … for the benefit of
the citizens of Myrtle Beach” and that the corpus and income from the funds held in trust were
to “be used for capital improvements which relate directly to … a public airport which serves the
Myrtle Beach area.” Opp. Ex. I at 1, Recitals and ¶ 2 (emphasis added). The City was then, and
is today, expressly authorized to own and operate an airport. See S.C. Code Ann. § 55-9-30. Thus,
by its plain terms, this City Council resolution recognized that any trust was for the benefit of the
citizens of that municipal corporation and provided no express benefit to the County as the City
was entitled to use the funds on any airport – including one of its own – if it so chose. The County
is not even mentioned in the 1995 Resolution and, again, the 2001 Attorney General letter
presuming the “likely” existence of a charitable trust does not state that such a trust would be for
the benefit of the County. Regardless, by the 2004 Agreement, the County released any beneficial
interest which could have been created in its favor by the 1995 Resolution as it expressly agreed
that any earlier agreement or representation was superseded.
The Complaint itself demonstrates that the City holds legal title to the Seascape Properties.
Compl. ¶¶ 6-7; Compl. Ex. A; Compl. Ex. C. “A legal title always prevails over an equitable title
10
At various points during the hearing on the Motion, the County invoked restrictions in
the 1948 quitclaim deed, 1953 Resolution and Release, and 1958 Agreements. For the reasons set
forth throughout this Order, those restrictions are no longer in effect. In any event, even assuming
they are still valid, the County is not a proper party to enforce them. See discussion, infra, at 27-
28.
21
unless the equity is so complete as to entitle the equitable claimant to a conveyance paramount to
the opposing legal title.” Jones v. Cathcart Co., 17 S.C. 592, 593 (1882). In fact, a claim of
equitable title is made for the express purpose of permitting the claimant to obtain legal title and
possession of the disputed property and often involves assertions of a right to title based upon a
representation of the legal title holder. 31 C.J.S. Estates § 9. The County, however, makes no
claim for legal title to or possession of the Seascape Properties in either its declaratory judgment
cause of action or its prayer for relief. See Compl. at 7, ¶¶ 34-36, and at 11-12. To the contrary,
and as acknowledged at the hearing by its counsel, the County actually seeks to enforce what it
believes to be an obligation that the City continue to lease the Seascape Properties and pay 75%
of the rental proceeds to the County in perpetuity. And any claim seeking legal title would be
without merit as the County has never entered into any contract for the acquisition of the Seascape
Properties, has never provided any consideration for such a contract, and has bargained away any
claim it could have by virtue of the 2004 Agreement which expressly provides that it supersedes
any prior representations. Accordingly, even if the County could establish any equitable title, it
cannot prevail over the City’s legal title under these undisputed facts.
Moreover, the Court finds that equity cannot aid the County under the undisputed facts,
which show that (1) the County ended up owning the very airport property that the City conveyed
to the Commission and agreed to financially support (i.e., the Crescent Beach, n/k/a Grand Strand,
Airport) for civil air operations (the commercial component of which operations the County, of its
own volition, transferred to the current Myrtle Beach International Airport), (2) the City has
supported the civil air operations at both of these airports for a period spanning some fifty plus
years (since 1963), (3) the County persistently challenged the City’s conduct regarding the
Seascape Properties civilly, administratively, and criminally, during a twenty plus year period
22
(between 1980 through 2004) without obtaining any determination in any forum that the City had
acted inappropriately in any manner, (4) the County agreed to resolve all of these prior disputes
and any representations of the City by way of the 2004 Agreement without ensuring that its belief
that a trust existed for its benefit to support operations at the Myrtle Beach International Airport
with proceeds from the rental revenues on the Seascape Properties in perpetuity was documented
and agreed upon by the City, and (5) the County has allowed the City to withhold and utilize for
its own purposes 25% of the lease revenues from the Seascape Properties for purposes other than
support of airports.
Three equitable maxims are brought into play here from these undisputed facts. First,
equity aids the vigilant, not those who slumber on their rights. Hemingway v. Mention, 228 S.C.
211, 89 S.E.2d 369 (1955). Under these facts, this Court would have no difficulty determining
that the doctrine of laches bars the County’s claims as it has known that the City has used 25% of
the lease proceeds for purposes other than airport operations since at least 2004 without any
objection by the County. See Provident Life & Acc. Ins. Co. v. Driver, 317 S.C. 471, 478, 451
S.E.2d 924, 929 (Ct. App. 1994) (“[u]nder the doctrine of laches, if a party, knowing his rights,
does not seasonably assert them, but by unreasonable delay suffers his adversary to incur expenses
or otherwise detrimentally change his position, then equity will ordinarily refuse to enforce these
rights”).
The second maxim is that equity follows the law. Smith v. Barr, 375 S.C. 157, 164, 650
S.E.2d 486, 489 (2007). In exercising discretion to provide an equitable remedy, this Court may
not violate statutes, rules of law, or precedent to provide equitable relief. Johnson v. Lloyd, 399
S.C. 470, 476, 732 S.E.2d 198, 201 (Ct. App. 2012) (citing Lonchar v. Thomas, 517 U.S. 314
(1996)), rev’d on other grounds, 407 S.C. 610, 757 S.E.2d 705 (2014). It is quite clear that the
23
law does not permit this Court to rescue the County from the terms it negotiated in the 2004
Agreement with the City, which resolves the parties’ disputes and supersedes all prior agreements
and representations but stops short of giving the County legal title to the Seascape Properties,
require that they be leased in perpetuity to support an airport owned by the County, or require that
the City or County use the proceeds to support any airport operations. See Carolina Cable
Network, supra. Nor can this Court ignore the City’s unfettered statutory authority to sell the
Seascape Properties delegated to it by the General Assembly in § 5-7-40.
The third maxim is that one who comes into equity must come with clean hands. Anderson
v. Buonforte, 365 S.C. 482, 617 S.E.2d 750 (Ct. App. 2005). Here, the 2004 Agreement allows
the City to use its portion of the lease revenues for purposes other than the support of an airport,
which is directly at odds with the County’s claim now that all lease proceeds are held in trust for
an airport. Even if the County has otherwise stated a basis upon which equitable title by the County
to the Seascape Properties could be recognized, that title cannot arise in circumstances in which
the County itself has agreed to allow (and allowed) the City to engage in conduct – pursuant to a
contract to which the County is a party – that is inconsistent with the terms of the trust the County
now claims to exist.
2. The County Has No Interest in Sale Proceeds from the Seascape Properties.
The County’s causes of action all assert, in one form or another, an entitlement to a portion
of the sale proceeds from the Seascape Properties.11 In regard to such a sale, the County’s
principal claim is that the City cannot sell the Seascape Properties at this price. The County’s
careful positioning is for good reason. There is not a single deed or other instrument of title
11
Only at hearing did the County assert that the City is consigned to being a perpetual
landlord of the Seascape Properties, which assertion the Court rejects. See discussion, supra, n. 5.
24
attached to the Complaint which gives the County an interest in the land itself nor any agreement
by the City to do so. This case instead is about money and the County’s implicit contention that it
may supplant the City’s statutorily granted prerogative to sell real property owned by the City.
As the Court has already found, the City has no obligation to pay the County any portion
of the sale proceeds under the 2004 Agreement. The construction of a clear and unambiguous
deed is a question of law for the court. Hunt v. Forestry Comm’n, 358 S.C. 564, 568, 595 S.E.2d
846, 848 (Ct. App. 2004). A restriction on the use of property must be created in express terms or
by plain and unmistakable implication, and all such restrictions are to be strictly construed, with
all doubts resolved in favor of the free use of property. Hamilton v. CCM, Inc., 274 S.C. 152, 157,
263 S.E.2d 378, 380 (1980).
The court may not limit a restriction, nor will a restriction be enlarged or extended
by construction or implication beyond the clear meaning of the terms, even to
accomplish what it may be thought the parties would have desired had a situation
which later developed been foreseen by them at the time when the restriction was
written.
Taylor v. Lindsey, 332 S.C. 1, 4, 498 S.E.2d 862, 864 (1998). Similarly, “[t]he court’s duty is to
enforce a contract made by the parties regardless of its wisdom or folly, apparent unreasonableness,
or the parties’ failure to guard their rights carefully.” Ellis v. Taylor, 316 S.C. 245, 248, 449 S.E.2d
487, 488 (1994). A contract cannot be rewritten “to impose liability based on some vague personal
sense of what is fair.” Crenshaw v. Erskine College, 432 S.C. 1, 25, 850 S.E.2d 1, 13 (2020); see
also Carolina Cable Network, supra.
Based on the documentation presented by the parties, the Court concludes that any
obligation to provide income from the Seascape Properties for the Myrtle Beach Municipal Airport
was extinguished by the City, the Federal government, and the Commission (the County’s claimed
predecessor) in 1958, and the remaining obligation to dedicate such income to the Crescent Beach
25
Airport expired in 1978 when the Commission’s obligation to operate it ceased. The City’s
decision to continue funding County airport operations after that point, including that reflected in
the 1995 Resolution, was unilateral and voluntary. The 2004 Agreement is a fully integrated
agreement between the City and the County that “supersedes any and all agreements and
representations made earlier.” Compl. Ex. G, 2004 Agreement at 8. As such, its terms cannot be
varied by evidence of any prior agreements. Wilson v. Landstrom, 281 S.C. 260, 266, 315 S.E.2d
120, 134 (Ct. App. 1984). The 2004 Agreement gives the County no interest in proceeds from the
sale of the Seascape Properties. It simply divides existing and future lease proceeds between the
County and the City and removes any requirement that the future proceeds derived from the leases
on the Seascape Properties be used for airport purposes. As noted above, the County has
recognized a right on the part of the City to keep a portion of the lease proceeds for itself and
devote them to purposes other than airports, thereby confirming that the very restriction the County
seeks to enforce here no longer exists. See discussion, supra, at 10 n.5, 15. The 2004 Agreement
and the County’s conduct since signing it reflect the County’s correct understanding that any then-
existing commitment by the City to use proceeds from the Seascape Properties for airport purposes
was freely revocable and was, in fact, revoked with the County’s blessing. Any lingering
obligation to use future proceeds from the Seascape Properties for airport purposes thus was
extinguished with the County’s consent and agreement in 2004. The County cannot change its
mind 16 years later. See 31 C.J.S. Estoppel and Waiver § 70 (“Estoppel by contract has been
described as a form of quasi-estoppel based on the proposition that a party to a contract will not
be permitted to take a position inconsistent with the contract’s provisions to the prejudice of
another.”).
26
The Court finds that the County therefore has not demonstrated a likelihood of success on
the merits of any of its causes of action12 which, in effect, are intended to deprive the governing
body of the City of its authority to dispose of municipal real property without the interference of
another governmental subdivision. See S.C. Code Ann. § 5-7-40 (conferring unfettered authority
on municipalities to convey real property); cf. S.C. Code Ann. § 4-9-41 (restricting any agreed
joint exercise of municipal and county powers so as to not permit one to diminish or alter the
political integrity of the other).
3. The County Is Not the Proper Party to Bring These Claims.
The County insists that its claims are premised on the Federal government’s restriction of
the use of sale proceeds to airport purposes through the Surplus Property Act. The Court finds that
any such restrictions are no longer in effect for reasons explained above. But assuming arguendo
12
Beyond the foundational failure of the County to establish any interest in the Seascape
Properties or their sale proceeds, its claims fail for a number of other reasons. The Court has
already addressed the County’s contention that the City will breach a fiduciary duty by selling the
Seascape Properties for $60,000,000. See discussion, supra, at 20 n .9. The County’s breach of
contract claim is wholly without merit in view of the plain language of the 2004 Agreement
discussed above. See, e.g., discussion, supra, at 7-8. The County’s promissory estoppel claim
requires that the County “prove (1) lack of knowledge and of the means of knowledge of the truth
as to the facts in question, (2) justifiable reliance upon the government’s conduct, and (3) a
prejudicial change in position.” Grant v. City of Folly Beach, 346 S.C. 74, 80, 551 S.E.2d 229, 232
(2001). The County has not, and cannot, meet this burden, particularly under the terms of the 2004
Agreement wherein the County agreed to the lifting of restrictions on the use of future lease
proceeds, did not reserve any right to sale proceeds and agreed that this document was a complete
resolution of all disputes between the City and County in this regard. The County also identifies
no existing promise that the City would deliver sale proceeds to the County, and the County does
not claim it changed its position under the expectation that it would receive such proceeds from
the Seascape Properties. Moreover, with respect to its unjust enrichment claim, the County never
explains how it is inequitable for the City to retain sale proceeds when the County never budgeted
or counted on them for airport operations. Nor can the County be entitled to relief on its
constructive trust cause of action in view of the 2004 Agreement, which supersedes (and
contradicts the contention that lease revenues have to be utilized to support the County’s airport
operations) the documents the County purports to rely upon. See Compl. ¶¶ 46-47.
27
only that these restrictions do currently apply, the Court finds that the County has no right to
enforce them.
The Surplus Property Act permits the Federal government to transfer title in surplus
property to a state, political subdivision, or tax-supported organization for use in developing an
airport. 49 U.S.C. § 47151(a).13 The government has the right to waive or add terms to a
conveyance under the act. 49 U.S.C. § 47153(a), -(b). “Only the Secretary [of Transportation]
may ensure compliance with an instrument conveying an interest in surplus property” pursuant to
the act. 49 U.S.C. § 47151(b); see also L-3 Commc’ns Integrated Sys., L.P. v. City of Greenville,
Tex., No. 3:11-CV-2294-P, 2012 WL 3941766, at *2 (N.D. Tex. Sept. 5, 2012) (“[T]he Surplus
Property Act grants exclusive regulatory and enforcement authority to the U.S. Secretary of
Transportation, acting through the FAA.”). The Secretary of Transportation has not done so here.
Indeed, as discussed above, the County previously requested that the FAA formally investigate
and resolve the County’s claims. See, e.g., discussion at 6-7, supra. The FAA appears to have
never acted on the County’s request. Thus, the only entity which can enforce the County’s asserted
rights already elected not to do so. Not only does this speak volumes about the merits of the
County’s arguments, but it also means the necessary party is not before this Court and this case
cannot proceed.14
E. An Injunction is Not Reasonably Necessary
13
The statutory language in effect in 1948 is substantively identical to the language
currently used. See Surplus Property Act of 1944, ch. 404, sec. 2, § 13(g), 61 Stat. 678, 678-80
(1947). For ease of reference, the City will cite to the current statute.
14
In addition, by failing to name the proposed purchasers of the Seascape Properties as
parties in this action, the County has not only failed to name a necessary party under Rule 19,
SCRCP, but also under Rule 65(e), SCRCP.
28
Even if the County had established each of the other four elements of entitlement to
temporary injunctive relief, which it has not, the Court concludes that the Motion still fails. This
case is not about property. The County does not access, use, or possess the Seascape Properties.
Indeed, the County must concede that the quitclaim deed and all agreements which followed do
not grant the County or its claimed predecessor any legal interest in the actual properties
themselves. As already noted by the Court, the County’s contention that the Seascape Properties
are unique is simply of no moment given that the County has no legal interest in them.
Instead, this case is really all about who gets how much money—be it lease proceeds or
sale proceeds from the Seascape Properties – as the Motion demonstrates. See, e.g., Motion at 1
(“The County understands and believes that the proposed sale price is below fair market value as
is evidenced by the City’s own appraisal of the Seascape Properties. Further, the County is
informed and believes that the City intends to keep for the City’s exclusive benefit all proceeds
from the proposed sale.”); id. at 2 (“The County seeks an order from this Court (a) enjoining the
City from selling the Seascape Properties as proposed [i.e., for $60 Million]; or (b) alternatively,
if the City is allowed to sell the Seascape Properties, requiring that all proceeds from the sale be
held in escrow by this Court until the claims asserted in this lawsuit have been fully adjudicated.”
(emphasis added)); id. at 3 (“The County risks being deprived of monies, to which it is otherwise
entitled, in the absence of the sale.”); id. at 4-5 (“The City’s attempt to sell this property at less
than its appraised value, to keep the proceeds from the sale, and to simultaneously cut off the
County’s stream of revenue from this property that is needed to maintain the airport all run directly
contrary to those interests . . . .”); id. at 5-6 (“[T]he City’s sale of the Seascape Properties would
create a unique harm to the County, in that responsibility for maintaining the airport would be
shifted to the County’s taxpayers without the corresponding revenue stream that is essential for
29
the airport’s operations.”). Any harm the County may suffer therefore is monetary and not
irreparable, at least as that term is used to warrant the grant of injunctive relief. See Sampson v.
Murray, 415 U.S. 61, 90 (1974) (“Mere injuries, however substantial, in terms of money, time and
energy necessarily expended in the absence of a stay, are not enough.” (citation omitted)).
But this claimed harm of the loss of revenue “essential for airport operations” suffers from
an even deeper flaw: it is demonstrably untrue. As already discussed, see pp. 16-18, supra, it is
clear from the County’s most recent budget and comprehensive annual financial report that there
is no risk to airport operations if the City sells the Seascape Properties, the County’s Department
of Airports is flush with unrestricted assets exceeding $35 Million, and will remain profitable
without the approximately $2.7 Million it is given by the County from the lease revenues on the
Seascape Properties it receives from the City -- even despite the on-going coronavirus pandemic.
These official County records do not bespeak any need on the County’s part for these lease
proceeds, only a desire to exact as much money from the City as it can. There also can be no
irreparable harm if the County does not receive any sale proceeds, as the County has not expected,
relied on, or budgeted for them in anyway. The County and its Department of Airports are more
than financially sound and well-positioned to meet their current and future financial obligations
regardless of any proceeds from the Seascape Properties.
Furthermore, any harm to which the County arguably may be exposed (and the Court finds
that there is none) will not be immediate. See Compton, 392 S.C. at 366, 709 S.E.2d at 642.
Focusing on the immediacy of the harm is consistent with the principle that an injunction is a
drastic remedy that should be imposed only when reasonably necessary. See Strategic Resources
Co., 367 S.C. at 544, 627 S.E.2d at 689. Here, the County and its Department of Airports are not
depending on lease proceeds for at least the next year, if not longer, and are not depending on sale
30
proceeds at any point in the foreseeable future. The affidavit submitted by the Assistant Director
after the hearing never specifies what harm she believes the County will suffer, and it only makes
general averments to speculative, undefined future impacts. The County therefore has not met its
burden to show an immediate harm that justifies the drastic remedy of an injunction.
CONCLUSION
For the foregoing reasons, it is ORDERED, ADJUDGED, and DECREED as follows:
1. Plaintiff’s Motion for Preliminary Injunction is DENIED.
2. The December 22, 2020, Temporary Restraining Order, as extended by the Court’s orders
dated January 4, 2021, and January 5, 2021 is DISSOLVED.
AND IT IS SO ORDERED.
[COURT’S ELECTRONIC SIGNATURE PAGE FOLLOWS]
31
Horry Common Pleas
Case Caption: Horry County Of VS Myrtle Beach City Of
Case Number: 2020CP2607070
Type: Order/Other
Presiding Circuit Court Judge
s/Benjamin H. Culbertson, Judge Code 2148
Electronically signed on 2021-01-25 13:01:28 page 32 of 32

Order Denying Motion For Preliminary Injunction Seascape Properties

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ELECTRONICALLY FILED - 2021 Jan 25 2:27 PM - HORRY - COMMON PLEAS - CASE#2020CP2607070

STATE OF SOUTH CAROLINA ) IN THE COURT OF COMMON PLEAS

Properties pursuant to separate contracts approved in ordinances adopted by City Council on

disposition to support a public airport.

commercial airport operations then ongoing at the Crescent Beach Airport.

government disclaimed any interest in them adverse to the County. Id.

review of the City’s conduct.2 Id. at 3.

Agreement at 6 (emphasis supplied).

agreements and representations made earlier.” Id. at 8 (emphasis supplied).

pending a ruling on the County’s motion for temporary injunction.

must therefore be dissolved.

STANDARD FOR GRANTING INJUNCTIVE RELIEF

meet its burden on any of these five elements.

A. The County Has an Adequate Remedy at Law.

does not use general fund taxes to support its airports.6

finds these cases to also be inapposite.

640-41, 699 S.E.2d at 707 (emphasis supplied).

which are not restricted in any way. See n. 5, supra.

City Council in this regard runs afoul of § 5-7-40.

judgment, is made at pleasure, without adequate determining principles, or is governed by no fixed

(Ct. App. 1985)).

the sale of the Seascape Properties:

Bugsy’s. Section 5-7-40, entitled “Ownership and disposition of property by municipalities,”

D. The County Has Not Demonstrated a Likelihood of Success on the Merits.

present ‘a fair question as to the existence of such a right”) (Citation omitted).

Resolution “likely” created a “charitable trust” in favor of the County.10 An insurmountable

that any earlier agreement or representation was superseded.

Seascape Properties delegated to it by the General Assembly in § 5-7-40.

now claims to exist.

263 S.E.2d 378, 380 (1980).

also Carolina Cable Network, supra.

political integrity of the other).

3. The County Is Not the Proper Party to Bring These Claims.

property to a state, political subdivision, or tax-supported organization for use in developing an

E. An Injunction is Not Reasonably Necessary

regardless of any proceeds from the Seascape Properties.

For the foregoing reasons, it is ORDERED, ADJUDGED, and DECREED as follows:

1. Plaintiff’s Motion for Preliminary Injunction is DENIED.

dated January 4, 2021, and January 5, 2021 is DISSOLVED.

[COURT’S ELECTRONIC SIGNATURE PAGE FOLLOWS]

Case Caption: Horry County Of VS Myrtle Beach City Of

Case Number: 2020CP2607070

Presiding Circuit Court Judge

s/Benjamin H. Culbertson, Judge Code 2148

Electronically signed on 2021-01-25 13:01:28 page 32 of 32

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