author: KONENKAMP, Justice.

text:
    2006 SD 25
    In the Matter of CHOICE HOTELS INTERNATIONAL, INC., License No. 73-001-521209798E-ST-001, Appellant, v. SOUTH DAKOTA DEPARTMENT OF REVENUE AND REGULATION, Appellee.
    No. 23730.
    Supreme Court of South Dakota.
    Considered on Briefs Feb. 13, 2006.
    Decided March 15, 2006.

      John L. Brown of Riter, Rogers, Wattier & Brown, Pierre, SD, for appellant.
    Harvey M. Crow, Jr. SD Department of Revenue and Regulation, Rapid City, SD, for appellee.
   KONENKAMP, Justice.

[¶ 1.] South Dakota law exempts travel agent services from sales tax. Nonetheless, the Department of Revenue, reasoning that an entity acting as a pass through for tax-exempt funds was not itself specifically exempt from paying the tax, issued a certificate of assessment against a hotel franchisor for sales tax on travel agent commissions it collects from its franchisees and pays to travel agents. The Department also assessed the franchisor for unpaid sales tax on fees collected for its customer incentive program. As to the travel agent fees, we hold that no sales tax applies because the franchisor acts strictly as a pass through in collecting and distributing tax exempt funds. With respect to the incentive program fees, however, we conclude that they are collected as part of a service and therefore are subject to sales tax. We affirm in part and reverse in part.

Background

[¶ 2.] Choice Hotels International, Inc. is the franchisor of eight hotel brands: Clarion, Quality, Comfort, Comfort Suites, Sleep Inn, EconoLodge, and Rodeway. After conducting an audit, the South Dakota Department of Revenue and Regulation issued a certificate of assessment against Choice for sales tax and interest totaling $66,497.80. Two of Choice’s programs were scrutinized in the audit resulting in the sales tax assessment: the Travel Agent Centralized Commission Program and the Choice Privileges Program. Choice disputed the taxability of both programs and contested the assessment, but it was unsuccessful in its administrative and circuit court appeals.

[¶ 8.] Designed to act as a pass through for travel agent commissions, the Travel Agent Centralized Commission Program works within Choice’s reservation system. Choice makes this a mandatory program in which all hotels must participate. It was developed by Choice because “[tjravel agents account for up to 40% of all reservations,” and there was a “potential for even higher reservation volume from travel agents[.]” After a reservation is booked with a Choice franchisee hotel through a travel agent, all the information is sent to a third party database, and then Choice sends an invoice to each franchisee.

[¶ 4.] Itemized in each invoice is a forty-eight cent processing fee Choice charges for each transaction and the commission owed by the franchisee to the travel agent for each reservation. A reminder at the bottom of Choice’s invoice explains that “Commissions are NOT PAID to the Travel Agency until [the franchisee’s] payment has been received.” Failure to pay the amount due on the invoice (the processing fee and commission) constitutes a breach of the franchise agreement.

[¶ 5.] After the invoice is received, the franchisee is required to verify the information and make any necessary changes. If a guest does not actually use the reservation, for example, the franchisee would deduct the commission charged. Once the invoice information is verified by the franchisee, it sends payment to a separate account owned by Choice. From that account, all the commissions collected are sent to the travel agents. The forty-eight cent processing fees are transferred to Choice’s operating account. Accordingly, Choice argues that the travel agent commissions it processes are exempt under South Dakota statutes, and transferring these commissions from the franchisees to the travel agents should not make them taxable.

[¶ 6.] Choice also challenges the taxa-bility of the monies collected through its Choice Privileges Program. This program was developed by Choice as an incentive plan for member guests to stay at franchisee hotels. The hotels are not required to participate in or offer the program to guests. However, if a franchisee elects to participate, it is required to pay Choice “$2.50 for each night a member of the Choice Privileges Program stays at that hotel.”

[¶ 7.] According to Choice, this $2.50 is used to reimburse participating franchisees when a member of the program stays at the franchisee for free. A member would stay for free after spending ten nights at qualifying franchisees. And because the guest is not required to spend the free eleventh night at the same franchisee where the qualifying nights were accumulated, Choice argues that the $2.50 is collected only to offset franchisee loss. Therefore, Choice asserts that the service should not be considered taxable, as Choice does not engage in an activity for a fee, retainer, commission, or other monetary charge.

[¶ 8.] These arguments were unsuccessful in Choice’s administrative and circuit court appeals. It now asks us to review the following questions: (1) “Whether travel agent commissions, otherwise exempt from sales tax under South Dakota statutes, are taxable receipts to a franchisor, which collects such commissions and disburses the commissions to the travel agent?” (2) “Whether the collection of monies from individual franchisees in order to reimburse a franchisee for a qualifying stay under a rewards program constitutes gross taxable receipts?”

Standard of Review

[¶ 9.] In administrative appeals, our standard of review is governed by SDCL 1-26-36. “We give deference to the agency on factual matters, applying the clearly erroneous standard of review.” Watertown Coop. Elevator Ass’n v. S.D. Dept. of Rev., 2001 SD 56, ¶10, 627 N.W.2d 167, 171 (citation omitted). Questions of law, such as the question whether a statute imposes a tax under a given factual situation, are reviewed de novo. Id. (quoting S.D. Dept. of Rev. v. Sanborn Tel. Co op., 455 N.W.2d 223, 225 (S.D.1990) (additional citation omitted)). “Statutes allowing tax exemptions are exactingly and narrowly construed in favor of the taxing entity.” Id. (citing Matter of Quality Service Railcar Repair Corp., 437 N.W.2d 209, 211 (S.D.1989)).

Analysis and Decision

1. Travel Agent Centralized Commission Program

[¶ 10.] Choice does not dispute that its forty-eight cent processing fee is a taxable gross receipt. However, it argues that transferring payment of the exempt travel agent commissions on behalf of the franchisees should not make the commissions taxable to Choice. Franchisees can pay the travel agent commissions directly to the travel agents. Choice merely acts as a pass through.

[¶ 11.] The Department, on the other hand, asserts that Choice’s circumstances do not fit the usual exemption for a travel agent commission. The exemption would apply, according to the Department, if the franchisee hotels paid the travel agent commissions to the travel agents directly. Here, however, the franchisees are making payment for travel agent commissions to Choice, which is not a travel agency. Accordingly, the Department contends that Choice has failed to prove that it is entitled to the exemption under SDCL 10-45-12.1.

[¶ 12.] A tax is imposed, under SDCL 10-45-4, “upon the gross receipts of any person from the engaging or continuing in the practice of any business in which a service is rendered.” Further, any service is subject to sales tax unless specifically exempted. Id. A service is defined in SDCL 10-45-4.1 as “all activities engaged in for other persons for a fee, retainer, commission, or other monetary charge, which activities involve predominantly the performance of a service as distinguished from selling property.” In SDCL 10-45-12.1, certain services are delineated as exempt from sales tax under SDCL ch. 10-45.

[¶ 13.] It is undisputed that travel agent services are exempt from sales tax under SDCL 10-45-12.1. Yet, for Choice to be entitled to an exemption on the travel agent commissions it processes, it has the burden to prove such exemption. See Matter of Pam Oil, Inc., 459 N.W.2d 251, 255 (S.D.1990). According to the Department, Choice was required to identify a specific statute that exempts a “pass-through” service.

[¶ 14.] “This [C]ourt has repeatedly held that the rule that laws exempting property from taxation should be strictly construed in favor of the taxing power does not call for strained construction, but must always be reasonable and will not be applied to defeat the expressed intent of the Legislature.” In the Matter of Veith, 261 N.W.2d 424, 426 (S.D.1978) (citing State v. Erickson, 44 S.D. 63, 182 N.W. 315 (1921); State v. Knudtson, 65 S.D. 547, 276 N.W. 150 (1937)). To interpret the exemption as narrowly as the Department has done in this case contravenes the legislative intent that travel agent commissions be exempt from sales tax.

[¶ 15.] The commissions would be exempt if paid by the franchisees to the travel agents. Here, Choice sends invoices to the franchisees indicating what amounts the franchisees owe the travel agents for commissions earned on reservations made at those franchisee hotels. The franchisees then have the option of paying the travel agents directly or submitting payment for the commissions in one payment through the Travel Agent Centralized Commission Program account owned by Choice. If franchisees elect to make payment through the agent commission account, Choice does not retain any portion of the commissions; all commissions are paid to the travel agents. Therefore, we conclude that it is unreasonable to hold that solely because the commissions are collected by the franchisor from the franchisees and then paid to the travel agents they are no longer exempt from tax. See Veith, 261 N.W.2d at 426. Choice met its burden to show that the travel agent commissions were exempt from tax under SDCL 10-45-12.1.

2. Choice Privileges Program

[¶ 16.] According to Choice, all monies collected through the Choice Privileges Program are awarded out of the program. As a result, Choice maintains that there is no taxable service because it does not retain a fee for this transaction. “As required by this statute, we use the predominant activity test in deciding if the services were subject to sales tax.” Watertown Coop. Elev. Ass’n, 2001 SD 56, ¶ 12, 627 N.W.2d at 172. From examining the transaction, it is evident that Choice offers the Choice Privileges Program to the franchisees in return for a fee. As we said in Watertown Coop, we focus on the transaction. See id.

[¶ 17.] This program was created to entice guests to stay at franchisee hotels. One guest benefit is that after staying ten nights, the eleventh night is free. When a guest receives a free night’s stay, the franchisee suffers a loss. In return for the franchisee’s participation in the program, Choice promises to reimburse the franchisee for the cost of the guest’s room. All that is required is payment of $2.50 each time a Choice Privileges member stays at that franchisee’s hotel. This constitutes an activity “engaged in for other persons for a fee....” See SDCL 10-45-4.1. Thus it is a taxable service under SDCL 10-45-4.

[¶ 18.] Affirmed in part and reversed in part.

[¶ 19.] GILBERTSON, Chief Justice, and SABERS, ZINTER, and MEIERHENRY, Justices, concur.

      . Choice paid the disputed amount of tax to stop interest from accruing, subject to a refund in the event its appeal was successful.

      . The account is administered by a third party and is entitled Choice Hotels International Travel Program.

      . The exempt services enumerated in SDCL 10-45-12.1 are from the Standard Industrial Classification Manual. Travel agent services are grouped under "arrangement of passenger transportation (group no. 472).” The Department argues that Choice must be primarily engaged in furnishing travel information and arranging lodging for travelers to be entitled to the exemption.

      . The Department does not assert that Choice retains any portion of this ten percent commission.


source: Caselaw Access Project

author: SABERS, Justice.

license: Public Domain

text:
    2006 SD 22
    In the Matter of the ESTATE OF Clifford T. MELAND, Deceased.
    No. 23776.
    Supreme Court of South Dakota.
    Argued Feb. 15, 2006.
    Decided March 8, 2006.
    Lawrence E. Long, Attorney General, Daniel J. Todd, Assistant Attorney General, Pierre, South Dakota, Attorneys for appellant Department of Social Services.
    Gordon P. Nielsen of Delaney, Vander Linden, Delaney, Nielsen <& Sannes, Sisse-ton, South Dakota, Attorneys for appellee Estate.
   SABERS, Justice.

[¶ 1.] The Department of Social Services (Department) petitioned the circuit court to allow its claim of $113,973.28 in the Estate of Clifford Meland. The Estate responded by filing a petition seeking to disclaim $166,849.77 that had passed to the Estate on account of various certificates of deposit and bonds that Clifford inherited from his sister, Alice Meland (Alice). The circuit court found that the disclaimer was untimely but operated as an assignment. The court then held that the assignment was not subject to the Department’s claim. We reverse.

FACTS

[¶ 2.] Alice died testate on October 1, 1997. Alice’s will directed that her assets be distributed equally amongst her four brothers. However, the will noted the following in regards to her brother, Clifford Meland (Clifford):

My brother Clifford and his wife, Margaret are both in the nursing home so Clifford’s share shall be distributed, per-stirpes among the children of Clifford Meland.

In addition to the probate assets, Alice left a significant amount of non-probate assets in the form of bonds and certificates of deposit. Clifford was named a joint owner of some these non-probate assets.

[¶ 3.] After paying nursing home related expenses for nearly four years, it was determined that Clifford did not have the resources to pay for future care. He applied for, and was determined eligible to receive Medicaid assistance through the Department. According to Department records, Medicaid paid approximately $113,973.28 on Clifford’s behalf.

[¶ 4.] Clifford died testate on October 30, 2003. The Department was served with notice of the probate proceedings on August 19, 2004. Shortly thereafter, the Department filed a statement of claim for the $113,973.28 in Medicaid benefits expended on Clifford’s behalf. The Estate rejected the Department’s claim. The Estate then filed a petition seeking to disclaim approximately $166,849.77 that passed to Clifford by virtue of the non-probate assets he inherited from Alice.

[¶ 5.] The circuit court held a hearing on the Estate’s petition for disclaimer. The court found that neither Clifford nor the Estate attempted to disclaim the assets received from Alice within the nine-month period mandated by SDCL 29Á-2-801. As a result, the court held that the attempted disclaimer was to be viewed as an assignment to the heirs of Alice’s estate. Additionally, the court held that the assets were to be assigned “free and clear of any claim” made by the Department and “said assets will pass as if Clifford [] Meland had predeceased Alice Meland.” The Department raises the following issues:

1. Whether the circuit court erred in determining the assignment is not subject to the Department’s claim.
2. Whether the circuit court erred in determining the assignment was in the best interest of the Estate.
3. Whether the circuit court erred in denying the Department’s petition for allowance of claim.

Standard of Review

[¶ 6.] This case requires us to interpret SDCL 29A-2-801, which is part of South Dakota’s Uniform Probate Code. “[Cjonstruing a statute entails answering a question of law; thus, we review the trial court’s statutory interpretation de novo.” In re Estate of Howe, 2004 SD 118, ¶ 16, 689 N.W.2d 22, 27. As this Court has previously noted:

Statutes are to be construed to give .effect to each statute and so as to have them exist in harmony. It is a fundamental rule of statutory construction that the intention of the law is to be primarily ascertained from the language expressed in the statute. In addition, we are statutorily mandated to interpret uniform laws such as the [UPC] “to effectuate its general purpose to make uniform the law of those states which enact it.” SDCL 2-14-13.

In re Estate of Jetter, 1997 SD 125, ¶ 11, 570 N.W.2d 26, 29 (quoting Rushmore State Bank v. Kurylas, 424 N.W.2d 649, 653 (S.D.1988)) (internal citations omitted).

Decision

[¶ 7.] Any person entitled to receive property, whether by will, intestate succession, “or as a surviving joint tenant of a decedent ... shall have the right to disclaim irrevocably the whole or any part of such property or beneficial interest.” SDCL 29A-2-801(a). A surviving joint tenant should follow the procedures set forth in SDCL 29A-2-801(c) in order to disclaim his or her interest. That section provides:

If a disclaimer of an interest receivable by the surviving joint tenant of a decedent is made in writing and filed with the clerk of the court in which the joint tenancy or estate proceeding is pending not later than nine months after the decedent’s death, then that disclaimer is retroactive to the decedent’s death and the joint interest so disclaimed passes as if the surviving joint tenant had predeceased the decedent.

SDCL 29A-2-801(e). Thus, Clifford had nine months to disclaim the assets he received as a result of Alice’s death. It is undisputed that Clifford failed to disclaim within the prescribed time period. Instead, Clifford’s personal representative is attempting to disclaim those assets almost seven years after Alice’s death.

[¶ 8.] Disclaimers that are not made within the nine-month time period set forth in SDCL 29A-2-801(c) are governed by SDCL 29A-2-801(i) which provides:

A disclaimer not made within the time limits prescribed by this section shall be construed as an assignment of the interest disclaimed to the persons who would be entitled to take had the disclaimer been timely made.

SDCL 29A-2-801(i). Pursuant to the above-quoted statute, the circuit court was correct in construing the Estate’s untimely disclaimer as an assignment. We now determine whether the circuit court was correct in concluding that the assignment was not subject to the Department’s claim.

[¶ 9.] SDCL 29A-3-817 pertains to claims by the Department for indebtedness incurred by paying for medical assistance or care. That statute is found in South Dakota’s Uniform Probate Code and provides:

The Department of Social Services is entitled to receive personal property of a decedent by presenting an affidavit pursuant to [SDCL] 29A-3-1201 and a statement that the department has incurred an indebtedness by paying for the medical assistance for nursing home or other medical institutional care on behalf of the decedent. If the person paying, delivering, transferring, or issuing personal property or the evidence thereof is aware of any such indebtedness, no payment or delivery may be made, except for payment of funeral expenses, unless payment is first made to the Department of Social Services or the department has issued a satisfaction of indebtedness.

SDCL 29A-3-817 (emphasis added). In the present case, the Department presented an affidavit and statement that it had incurred an indebtedness of $113,973.28. The Estate’s personal representative was aware of the Department’s claim. Additionally, the Department has not issued a satisfaction of indebtedness. Consequently, the issue becomes whether an “assignment” pursuant to SDCL 29A-2-801(i) constitutes a “transfer” under SDCL 29A-3-817.

[¶ 10.] The terms “transfer” and “assignment” are not defined by South Dakota’s Uniform Probate Code, but are terms of art. Black’s Law Dictionary defines an assignment as “the transfer of rights or property.” Black’s Law Dictionary 115 (7th ed.1999). It defines transfer as “any mode of disposing of or parting with an asset or an interest in an asset[.]” Id. at 1503. These definitions are consistent with the definition found in another provision of South Dakota law. Thus, an assignment is a transfer in the legal sense of the word. As a result, the circuit court erred when it determined that the assignment was not subject to the Department’s claim.

[¶ 11.] The Department incurred expenses of $113,973.28 on Clifford’s behalf. The record is clear that Clifford had an interest in these assets as far back as October of 1997. The Legislature did not intend that an individual could avoid reimbursing the Department for Medicaid expenses by waiting six years, filing an untimely disclaimer, and then assigning the funds. As this Court has noted, “[t]he Medicaid program is not to be used as an estate planning tool.” Meyer v. South Dakota Dept. of Soc. Serv’s, 1998 SD 62, ¶23, 581 N.W.2d 151, 157 (quoting Striegel v. State Dep’t of Social Serv’s, 515 N.W.2d 245, 247 (S.D.1994)). We have also explained the public policy behind Medicaid as follows:

Congress enacted the MQT [Medicaid Qualifying Trust] provision, 1396a(k)(2), as an addition to the provisions designed to assure that individuals receiving nursing home and other long-term care services under Medicaid are in fact poor and have not transferred assets that should be used to purchase the needed senices before Medicaid benefits are made available.

Id. (citations and internal quotations omitted) (emphasis in original). Nor should individuals be able to transfer assets in order to avoid reimbursing the Department for benefits that have been paid.

[¶ 12.] The Estate cites In re Estate of Kirk, arguing that disclaiming assets in an attempt to avoid paying Medicaid debts is not offensive to public policy. 591 N.W.2d 630 (Iowa 1999). In Kirk, however, the Iowa Supreme Court was examining a disclaimer by a personal representative who had followed the proper statutory procedures. Id. at 632-33. In the present case, the personal representative’s actions are not to be construed as a disclaimer, but rather an assignment. SDCL 29A-2-801(i). It is therefore unnecessary for us to address whether a valid disclaimer pursuant to SDCL 29A-2-801 violates public policy when used to avoid paying Medicaid debts.

[¶ 13.] Finally, the Estate relies on the dissent in In re Estate of Berg which stated:

The nine-month limitation fixed by SDCL 43-4-30 (originally six months, see 1968 SDSessLaws ch 254, § 2(1)) was obviously established to correlate with the provisions of the federal estate tax laws and should not be determinative of the validity of an otherwise valid disclaimer. Indeed, SDCL 43-4-34 specifically provides that an untimely filed disclaimer operates as an assignment of the interest disclaimed.

355 N.W.2d 13, 15 (S.D.1984) (Wollman, J., dissenting). The Estate is urging us to view Justice Wollman’s dissent in isolation. The issue in Berg was whether an individual could rescind a disclaimer. Id. at 14. The majority held that a disclaimer could be rescinded or revoked so long as it was done within the nine-month period prescribed by the statute. Id. Justice Woll-man would not have permitted the revocation of a disclaimer absent a finding of “fraud, misrepresentation, or duress.” Id. at 15. Thus, the crux of Justice Wollman’s dissent was that absent a showing of fraud, misrepresentation, or duress, a disclaimer cannot be revoked, regardless of when the individual is attempting to revoke the disclaimer.

[¶ 14.] In summary, the attempt to disclaim was not filed within nine months of Alice’s death, was untimely, and not retroactive to her death. Accordingly, it oper: ated as an assignment and was subject to the Department’s claim. In view of our holding on Issue 1, it is not necessary to reach either Issue 2 or 3.

[¶ 15.] Reversed.

[¶ 16.] GILBERTSON, Chief Justice, and KONENKAMP, ZINTER, and MEIERHENRY, Justices, concur.

      . The Department's claim is the only claim that was filed in the Estate.

      . But see infra n. 5.

      . SDCL 29A-2-801(j) gives the personal representative of an estate the same right to make disclaimers as that of the decedent. In the present case, it is the personal representative who is attempting to disclaim. However, it was Clifford who should have disclaimed within nine months after Alice’s death.

      . SDCL 43-42-4 recognizes that an assignment is a transfer. It provides in part: "Every written assignment made in good faith, whether in the nature of a sale, pledge, or other transfer .... ” (emphasis added).

      . The Estate also argues that SDCL 29A-2-801(h) provides:
      The right and means provided in this section for the making of a disclaimer are not exclusive but are in addition to every other right and means of a person to make a disclaimer. Nothing in this section shall prevent the making of a disclaimer in any lawful manner. SDCL 29A-2-801(h). However, the Estate has not asserted an alternative "lawful manner” by which it is attempting to disclaim.

      .There is no evidence in the record that these assets were disclosed to the Department when Clifford applied for Medicaid benefits, or were brought to the Department's attention during the time he was receiving benefits.


author: SABERS, Justice. MEIERHENRY, Justice

text:
    2006 SD 23
    STATE of South Dakota, Plaintiff and Appellant, v. Thomas Scott BURDICK, Defendant and Appellee.
    No. 23598.
    Supreme Court of South Dakota.
    Argued Jan. 11, 2006.
    Decided March 8, 2006.

      Lawrence E. Long, Attorney General, Katie L. Hansen, Assistant Attorney General, Pierre, South Dakota, Attorneys for plaintiff and appellant.
    Douglas M. Dailey, Timothy G. Bottum of Morgan, Theeler, Wheeler, Cogley & Petersen, Mitchell, South Dakota, Attorneys for defendant and appellee.
   SABERS, Justice.

[¶ 1.] Thomas Burdick was charged with twenty counts of third degree burglary and twenty counts of petty theft. After a preliminary hearing, the circuit court dismissed all of the burglary counts. The state appeals from the circuit court’s order. We reverse and remand.

FACTS

[¶ 2.] The defendant, Thomas Burdick (Burdick), was employed by Land O’ Lakes as a milk truck driver and delivery man. Burdick’s delivery route included the City of Plankinton,- South Dakota. During a three-year period, Burdick delivered milk to “Ron’s Market (the market),” a grocery store located in Plankinton. Burdick usually made deliveries to the market during late evening, or early morning hours.

[¶ 3.] The market conducts its retail business in the front of the building. Customers routinely have access to this portion of the building. The back of the building is used as a storage area. The market stores its grocery items on pallets, shelves, and in bulk coolers in this portion of the building. During non-business hours, the storage portion of the building is separated from the retail portion by a metal door. The market’s owners secure the door from the retail portion of the market, using a metal bar. Outside access to the storage portion of the building is gained through a garage door.

[¶ 4.] The market’s owners gave Bur-dick a garage door opener to allow him to have access to the storage portion of the building during non-business hours. Bur-dick made deliveries to the market during the years 2002, 2003, and 2004. On at least twenty occasions, Burdick would make the milk delivery, and then take one or more cases of soda pop -without the owner’s permission. The value of the soda pop never exceeded one hundred dollars.

[¶ 5.] The state charged Burdick with twenty counts of petty theft and twenty counts of third degree burglary. Burdick made a motion to dismiss the twenty burglary charges. After the preliminary hearing, the circuit court issued a written decision. It ruled that this Court’s prior case law requires unauthorized or unlawful presence to sustain a burglary charge. Because the state stipulated to the fact that Burdick had permission to enter the building, the circuit court dismissed all of the burglary counts.

Standard of Review

[¶ 6¡] This case requires us to engage in statutory interpretation. Statutory interpretation is a question of law, reviewed de novo. MGA Insurance Co., Inc. v. Goodsell, 2005 SD 118, ¶ 9, 707 N.W.2d 483, 485 (citing Block v. Drake, 2004 SD 72, ¶ 8, 681 N.W.2d 460, 462). The intent of the law is ascertained primarily from the language of the statute. Id. ¶ 16 (citing State v. Myrl & Roy’s Paving, Inc., 2004 SD 98, ¶ 6, 686 N.W.2d 651, 653-654). However, other enactments relating to the same subject are relevant in determining legislative intent. Goodsell, 2005 SD 118, ¶ 16, 707 N.W.2d at 486. When the language of a statute is clear and unambiguous, our only function is to declare the meaning of the statute as clearly expressed. Id. ¶ 9 (citing State v. Myrl & Roy’s Paving, Inc., 2004 SD 98, ¶ 6, 686 N.W.2d at 653-54).

Decision

[¶ 7.] In 1976, the South Dakota Legislature repealed the statute that defined third degree burglary and replaced it with SDCL 22-32-8, which provided:

Any person who enters or remains in an unoccupied structure, with intent to commit any crime therein, is guilty of third degree burglary. Third degree burglary is a Class 4 felony.

State v. Blair, 273 N.W.2d 187 (S.D.1979). The statute had a broad sweep, criminalizing the entering or remaining in an unoccupied structure, with the intent to commit any crime.

[¶ 8.] In Blair, this Court examined whether SDCL 22-32-8 “require[d] some form of unauthorized entry by a person entering an unoccupied structure with the intent to commit a crime.” 273 N.W.2d at 187. Blair had entered a laundromat, pried open coin boxes with a crow bar, and stole a case of soda pop. Id. He argued that the burglary charge should be dismissed because he had entered the laundromat during regular business hours and, was therefore authorized to enter. This Court held that consent to enter the unoccupied structure was irrelevant. Id. at 188. Justice Zastrow dissented, concerned primarily with the fact that “the commission of any crime indoors would appear to be subject to a burglary charge since the burglary statutes refer to entering or remaining. ...” Id. at 188 (Zastrow, J., dissenting) (internal quotations omitted).

[¶ 9.] In State v. Shult, this Court upheld a second degree burglary conviction where the defendant entered a convenience store during regular business hours and attempted to steal a frozen pizza. 380 N.W.2d 352 (S.D.1986). Justice Henderson dissented, generally indicting the burglary statutes for being “extremely broad and expansive and eneompass[ing] numerous circumstances not within the traditional common law crime of burglary.” Id. at 357 (Henderson, J., dissenting).

[¶ 10.] Two years after Shult, this Court decided In the Matter of T.J.E., 426 N.W.2d 23 (S.D.1988). In that case, an eleven-year-old girl had been adjudicated delinquent after the circuit court found she committed second degree burglary by eating a chocolate Easter egg in a department store without paying. Id. at 23. The circuit court found that T.J.E. remained in the store with the intent to commit a crime. Id. at 24. This Court reversed. It refused to give the word “remains” its literal meaning, noting that to do so would produce an absurd result. Id. Ultimately, the Court held that the word “remains” means unlawful presence or presence without authority in the structure. Id. at 25. The Court distinguished Blair on the grounds that anyone who enters a structure, even one of public accommodation, with the intent to commit a crime, has done so unlawfully and without authority. Id.

[¶ 11.] The Legislature amended SDCL 22-32-8 in response to the T.J.E. decision. SDCL 22-32-8 now provides:

Any person who enters an unoccupied structure, with the intent to commit any crime other than the act of shoplifting or retail theft as described in chapter 22-SOA constituting a misdemeanor, or remains in an unoccupied structure after forming the intent to commit any crime other than shoplifting as described in chapter 22-SOA constituting a misdemeanor, is guilty of third degree burglary. Third degree burglary is a Class 4 felony.

(emphasis added). The Legislature made an exception to the burglary statute for shoplifting or retail theft that amounted to a misdemeanor. It did not require an unlawful presence or presence without authority as we held in T.J.E. Nor did it eliminate the possibility that an individual could be guilty of burglary when forming intent to commit any crime and “remaining” in the structure. In short, the amendment to SDCL 22-32-8 created an exception for shoplifters, but rejected this Court’s reasoning in T.J.E.

[¶ 12.] Despite the plain text of the statute, this Court continued to adhere to the rule set forth in T.J.E. In State v. Derby, this Court noted that “unlawful or unauthorized entry into a structure [is] an element of third-degree burglary.” 462 N.W.2d 512, 513 (S.D.1990). Although the Court acknowledged the exception, it did not have occasion to apply it because Derby had gained access to the structure “only after removing a window of the establishment after business hours.” Id.

[¶ 13.] In State v. Oster, the defendant was appealing his conviction of second degree burglary. 495 N.W.2d 305 (S.D. 1993). Oster had driven his car off of the road during a snowstorm and could not get his car out of the ditch. Id. at 307. He walked to a nearby house and asked for assistance. Id. The owner of the house agreed to help Oster and invited him inside while he put on his boots. While inside, Oster stole some cash and a check out of the man’s wallet, which had been placed on the kitchen table. Id.

[¶ 14.] On appeal, Oster argued that his conviction should be overturned because he had been invited into the home and was therefore on the premises lawfully. Id. at 311. This Court agreed and reversed the conviction. The Court acknowledged that the plain text of SDCL 22-32-8 only provided an exception for shoplifting or retail theft. However, the Court continued to adhere to the rule in T.J.E. because “the statute still fail[ed] to remedy the problem that the commission of any crime indoors, no matter how severe, is subject to a felony burglary charge.” Id. at 311. The dissent noted that continued application of the rule in T.J.E. was “in direct conflict with the obvious intent of the legislature and erroneous.” Id. at 313 (Sabers, J., dissenting).

[¶ 15.] In State v. DeNoyer, this Court unanimously sustained the second degree burglary conviction of a defendant who entered a woman’s home and committed the crime of rape. 541 N.W.2d 725 (S.D. 1995). Two members of this Court voted to overrule Oster and put an end to the application of the rule in T.J.E. Id. at 733. They noted that the plain language of the burglary statute “simply requires that the person remain in the structure after forming the intent to commit a crime.” Id. at 733. Although Justice Konenkamp had “misgivings about State v. Oster,” he did not believe it was necessary to overrule

Oster to reach the result in the case. Id. at 734. Despite the fact that DeNoyer was a plurality opinion, our subsequent opinions recognized it as overruling Oster. See State v. Sorenson, 2000 SD 127, ¶ 6, 617 N.W.2d 146, 148 (noting Oster had been overruled by DeNoyer); State v. Alidani, 2000 SD 52, ¶ 9, 609 N.W.2d 152, 155.

[¶ 16.] It is through these precedents that we analyze the present case. In doing so, we start with the plain language of SDCL 22-32-8. That language clearly indicates the Legislature’s intent to criminalize the entering or remaining in an unoccupied structure with the intent to commit any crime. The only exception that appears in the statute is for shoplifting or retail theft. Despite the rationales in T.J.E., Derby, and Oster, the Legislature did not make an exception for people who had entered a structure lawfully, or with consent from the owner. Had the Legislature intended to codify the exception set forth in those cases, it easily could have done so. Instead, the statute has remained the same during the last sixteen years.

[¶ 17.] Those Justices that have supported a requirement of unlawful or unauthorized entry have been primarily concerned with the broad reach of conduct the statute encompasses. See Blair, 273 N.W.2d at 188 (Zastrow, J., dissenting) (remarking that writing an insufficient funds check may constitute burglary under the statute); Shult, 380 N.W.2d at 357 (Henderson, J., dissenting) (hypothesizing that an individual who enters a friend’s house with the intent to smoke marijuana could be charged with burglary). The Legislature would have been aware of these writings, yet it only provided exceptions for shoplifting and retail theft.

[¶ 18.] Burdick puts forth many of the same policy arguments as the dissenters in Shult and Blair. However, it is the province of the Legislature to define what conduct is criminal and provide appropriate punishment. The separation of powers would be meaningless if the judiciary were able to create exceptions to a criminal law based upon its notion of fairness. See United States v. Jones, 542 F.2d 661 (6thCir,1976) (“It is not for this Court to question the wisdom of Congress and to establish an implied exception to a federal statute by judicial fiat.”). As the dissent in Oster remarked:

The purpose of the legislative branch is to enact the laws. The purpose of the judicial branch is to interpret and enforce the laws. It is important to refresh our memories occasionally, lest we forget.

495 N.W.2d at 313 (Sabers, J., dissenting). The terms of SDCL 22-32-8 are clear and unambiguous. We must accept what “the legislature has said — and has not said— rather than attempt to rewrite the law to conform with what we or others think it should have said.” Goodsell, 2005 SD 118, ¶ 29, 707 N.W.2d at 488 (quoting Petition of Famous Brands, Inc., 347 N.W.2d 882, 885 (S.D.1984)). We hold that SDCL 22-32-8 does not require unlawful presence or presence without authority. Third degree burglary only requires that a defendant enter or remain in an unoccupied structure with the intent to commit any crime other than shoplifting or retail theft.

[¶ 19.] Burdick points out that the Legislature has amended SDCL 22-32-8 effective July 1, 2006, and trill require a showing that the defendant was not privileged to enter or remain in the structure. Bur-dick is correct, but that amendment does not take effect until July 1, 2006. We cannot apply an amendment prior to its effective date. The decision of the circuit court is reversed, and this matter is remanded for trial.

[¶ 20.] Reversed and remanded.

[¶ 21.] GILBERTSON, Chief Justice, and KONENKAMP and ZINTER, Justices, concur.

[¶ 22.] MEIERHENRY, Justice, dissents.

MEIERHENRY, Justice

(dissenting).

[¶ 23.] I dissent. The majority’s interpretation of the statute casts the net of the burglary statute so expansively that it ensnares any offense committed indoors, no matter how petty. Thus, dropping a candy wrapper on the floor, illegally downloading music from the internet, taking a towel from a motel, and walking out of a bar with a glass all become felonies punishable by ten to twenty-five years in the penitentiary. Common sense should tell us this was not the intent of the legislature.

[¶ 24.] At common law, burglary was defined as “the breaking and entering of the dwelling house of another in the nighttime with the intent to commit a felony.” State v. Pellegrino, 1998 SD 39, ¶ 14, 577 N.W.2d 590, 596 (citation omitted). As we have recognized,

“[T]he offense of burglary at common law was considered one aimed at the security of the habitation rather than against property. That is to say, it was the circumstance of midnight terror aimed toward a man or his family who were in rightful repose in the sanctuary of the home, that was punished, and not the fact that the intended felony was successful. Such attempted immunity extended to a man’s dwelling or mansion house has been said to be attributable to the early common-law principle that a man’s home is a castle.”

State v. Celli 263 N.W.2d 145, 147 (S.D. 1978) (quoting Smart v. State, 244 Ind. 69, 72, 190 N.E.2d 650, 652 (1963)). As evidenced by statute, however, our Legislature broadened the definition of burglary, see, e.g., SDCL 22-32-3; SDCL 22-32-8; SDCL 22-32-17, and our decisions have done the same.

[¶ 25.] As of July 1, 2006, however, burglary statutes will not apply to a person who has privilege to enter a structure. The statute which defines third-degree burglary, in its entirety, will provide:

Any person who enters or remains in an unoccupied structure, other than a motor vehicle, with intent to commit any crime, unless the premises are, at the time, open to the public or the person is licensed or privileged to enter or remain, is guilty of third degree burglary. Third degree burglary is a Class 4 felony-

SDCL 22-32-8 (effective July 1, 2006). The change to SDCL 22-32-8 reflects a legislative determination that burglary has been too broadly defined. It effectively repeals our cases that find consent irrelevant. This change not only prevents shoplifters from being charged with felony burglary, but it also prevents the application of burglary statutes to the commission of any crime, no matter how severe, indoors.

[¶ 26.] This change, however, comes too late for Burdick. Even though Bur-dick was privileged to enter the market, a broad interpretation of the current statute punishes his conduct — conduct which would not be punishable under the amended version of SDCL 22-32-8 which takes effect July 1, 2006. Also unfortunate for Burdick is the fact that he took the soda from the storage area of the market, for if he would have taken merchandise displayed or offered for sale, his conduct would have fallen within the shoplifting or retail theft exception to the current version of SDCL 22-32-8. See SDCL 22-30A-19.1 (defining liability of a shoplifter to a merchant as the amount owed by “[a]ny adult ... who takes possession of any goods, wares, or merchandise displayed or offered for sale by the store or other mercantile establishment without the consent of the owner or seller and with the intention of converting the goods to the person’s own use without having paid the purchase price”). We continually profess our canon of construction which requires us to avoid interpreting a statute so as to achieve an absurd result. See, e.g., State v. Brekke, 2005 SD 31, ¶15, 694 N.W.2d 46, 50. The result reached by the majority violates that canon. The possibility of 200 years in prison for taking 20 cases of soda is an absurd result. I would affirm the trial court.

      . The state and the defendant stipulated to these facts for purposes of the preliminary hearing.

      . Justice Miller and Justice Amundson also found it unnecessary to overrule Oster. However, Justice Miller's concurrence did recognize that "the plain language of the statute does not mandate criminal intent be formed only at the time of entry.” Id. at 734 (Miller, J., concurring).

      . The plain language of the statute does create an almost infinite amount of situations that could hypothetically be categorized as burglary. For example, the State conceded at oral argument that one could be charged with burglary for committing a computer crime in one's own home. However, our duty is to interpret the statute as written and apply it to the facts at issue. It is not for this Court to make individualized policy judgments and second guess the Legislature’s judgment as to what conduct should or should not be criminal.


text:
    2006 SD 26
    Raymond E. MELIGAN, Plaintiff and Appellee, v. DEPARTMENT OF REVENUE AND REGULATION, Defendant and Appellant.
    No. 23715.
    Supreme Court of South Dakota.
    Argued Jan. 10, 2006.
    Decided March 15, 2006.

      John L. Brown of Riter, Rogers, Wattier & Brown, Pierre, South Dakota, Attorneys for plaintiff and appellee.
    Lawrence E. Long, Attorney General, Diane Best, Grant Gormley, Assistant Attorneys General, Pierre, South Dakota, Attorneys for defendant and appellant.
   SABERS, Justice.

[¶ 1.] The Department of Revenue and Regulation (Department) found that appraiser Raymond Meligan (Meligan) made eleven different errors and omissions in an appraisal which constituted violations of the Uniform Standards of Professional Appraisal Practice (USPAP). Meligan appealed to the circuit court. On review, the circuit court held that the Department’s findings were either clearly erroneous or irrelevant and did not justify sanctions. Department appeals. We affirm in part and reverse in part and remand to allow the Department to determine appropriate sanctions for only those violations that have support in the record.

Facts

[¶ 2.] Meligan is a state certified general appraiser who has been in the private appraisal business for almost twenty years. In March 2002, Meligan was retained by America’s Moneyline, Inc. to appraise property located at 3005 Karen Court, Pierre, Hughes County, South Dakota.

[¶ 3.] Bob Tinker (Tinker) owned the property and sought to refinance through America’s Moneyline. The building on the Tinker property is a 1930’s barn that had been moved from Sully County, South Dakota. Tinker obtained building and special use permits to remodel the barn and convert it into a year-round bed and breakfast. The barn was remodeled to include five bedrooms and five bathrooms. It has three floors, but the third floor was not finished. Tinker advertised the property as “Horse Feáthers Bed and Breakfast.” He sought the refinancing in order to construct a six-car garage.

[¶ 4.] On March 29, 2002, Meligan appraised the Tinker property. Initially, Mel-igan did an appraisal that included the value of the six-car garage as finished. However, America’s Moneyline informed Meligan that it could not make a loan on an “as will be” basis. Meligan later removed the value of the garage from the appraisal.

[¶ 5.] America’s Moneyline hired Kay Swanhorst (Swanhorst), an appraiser from Aberdeen, to conduct a second appraisal of the Tinker property in an effort to determine the accuracy of Meligan’s appraisal. However, Tinker decided not to proceed with the loan because he was unable to obtain the interest rate he desired. When Swanhorst arrived at the Tinker property, he informed her that an appraisal was unnecessary. Swanhorst conducted a field appraisal despite Tinker’s comments, but never inspected the interior of the building.

[¶ 6.] Swanhorst concluded that Meli-gan’s appraisal contained numerous errors. She filed a complaint against Meligan with the Appraiser Certification Program. The complaint alleged that Meligan’s appraisal had been misleading, misrepresentative, and fraudulent.

[¶ 7.] The Department assigned the complaint to Ken Simpson (Simpson), who performed a desk review of the Meligan appraisal. Simpson found the appraisal to be incompetent and misleading. He claimed that Meligan violated’the USPAP by:

(1) Failing to disclose in the appraisal that the Tinker property had been used as a bed and breakfast,
(2) Failing to disclose that the property was a 1930’s barn moved to the site and extensively remodeled,
(3) Failing to disclose in the primary report that the Tinker barn is a three-story structure,
(4) Failing to include an intended user provision in the appraisal,
(5) Failing to discuss that Comparable 3 was not a sale,
(6) Listing an inaccurate address for Comparable 3,
(7) Listing an inaccurate date of sale for Comparable 2,
(8) Failing to properly, certify the appraisal,
(9) Failing to include a provision in the appraisal that identified the scope of the work,
(10) Failing to include highest and best use analysis, and
(11) Failing to include support for a land value opinion.

Although Simpson identified a total of eleven violations, his opinion was based primarily upon the alleged failure to discuss the potential use as a bed and breakfast and the failure to disclose that the Tinker property consisted of an old barn that had been remodeled. Neither Simpson nor the Department claimed that Meligan was inaccurate in terms of his ultimate valuation of the Tinker property. The Department sent Meligan notice of its intent to suspend his state certified general appraiser license for ninety days and impose a fine in the amount of five hundred dollars. Additionally, the Department required Meligan to successfully complete an approved appraisal course.

[¶ 8.] Meligan requested an administrative hearing after settlement negotiations with the Board were unsuccessful. At the hearing, Simpson testified as an expert witness on behalf of the Board. His testimony primarily concerned the eleven alleged violations he found in his initial examination of Meligan’s appraisal.

[¶ 9.] Meligan testified that although he made some of the alleged errors and omissions, they were merely technical violations that had no effect on the ultimate valuation of the property. He further testified that the Tinker property had been used primarily as a residence and that its highest and best use was as a residence. According to Meligan, a bed and breakfast is a residence under state law and a license to operate a bed and breakfast is nontransferable. Therefore, Meligan believed it would have been misleading had he portrayed the Tinker property as having additional value beyond that of a residence.

[¶ 10.] Tinker also testified at the hearing. He testified that he lived in the building and had been living there for three to four years. One of Tinker’s assistants had also been living in the building. Occasionally, Tinker would house hunters, or allow state officers to conduct meetings on the premises. However, the Tinker property is seldom used as a bed and breakfast during the “off season.”

[¶ 11.] The administrative law judge (ALJ) found that Meligan’s appraisal was fundamentally flawed for the reasons put forth by Simpson. Additionally, the ALJ made a finding that Simpson was credible and persuasive and that Meligan was not credible. Finally, the ALJ recommended that Meligan’s appraiser license be suspended for ninety days, that he pay a fine of five hundred dollars, and that he successfully complete an approved appraisal course. The Board adopted the ALJ’s decision in its entirety.

[¶ 12.] Meligan appealed the Board’s decision to the circuit court. The circuit court issued a memorandum decision and its own findings of fact and conclusions of law. It found that several of the ALJ’s findings of fact were clearly erroneous. The court noted that although Meligan admitted to several violations of USPAP, those violations were minor and had no effect on Meligan’s valuation. Moreover, the court found that the penalty the Board imposed was disproportionately severe in light of the fact that nobody had been harmed by the appraisal. Ultimately, the court held that the Department’s suspension was an abuse of discretion.

Standard of Review

[¶ 13.] “When a circuit court has reviewed an administrative agency’s decision, we review the agency’s decision unaided by any presumption that the circuit court’s decision was correct.” Kas-svhe v. Dakota Logging, 2005 SD 102, ¶ 25, 705 N.W.2d 461, 465. SDCL 1-26-36 requires that we give great weight to the agency’s factual findings and inferences. In re Klein, 2003 SD 119, ¶ 6, 670 N.W.2d 367, 368. Consequently, we will not set those findings or inferences aside unless they are clearly erroneous. Id. “The test is whether after reviewing all the evidence we are left with a definite and firm conviction that a mistake has been made.” Kurtz v. SCI, 1998 SD 37, ¶ 9, 576 N.W.2d 878. However, if an agency makes factual determinations on the basis of documentary evidence, those determinations are reviewed de novo. Haynes v. McKie Ford, 2004 SD 99, ¶ 14, 686 N.W.2d 657, 661 (citing Watertown Coop. Elevator Ass’n v. State Dept, of Revenue, 2001 SD 56, ¶ 10, 627 N.W.2d 167,171).

[¶ 14.] “In matters concerning the revocation of a professional license, we determine that the appropriate standard of proof to be utilized by an agency is clear and convincing evidence.” In re Setlijf 2002 SD 58, ¶ 13, 645 N.W.2d 601, 605. That standard “lies somewhere between the rule in ordinary civil cases and requirements of our criminal procedure, that is, it must be more than mere preponderance but not beyond a reasonable doubt.” Id. (additional citations and internal quotations omitted).

Decision

[¶ 15.] We consider each of the claimed errors in reviewing the Department’s determination that Meligan’s appraisal was incompetent.

1. Failure to disclose that the Tinker property had potential use as a bed and breakfast.

[¶ 16.] Section 306 of the Fannie Mae Appraisal Guidelines requires an appraiser to provide an adequate description of the mixed-use characteristics of a subject property in the appraisal report. Section 306 provides in part:

Although we will purchase or securitize mortgages that are secured by properties that have a business use in addition to their residential use — such as property with space set aside for a day care facility, a beauty or barber shop, a doctor’s office, a small neighborhood grocery or specialty store, etc. — we have special eligibility criteria for them.
Therefore, the appraiser must provide an adequate description of the mixed use characteristics of the subject property in the appraisal reportf.]

The Fannie Mae guidelines are supplemental standards which must be met in order to satisfy USPAP. It is undisputed that Meligan did not disclose in his appraisal that the Tinker property had been used as a bed and breakfast. Because Meligan knew the property was being used as a bed and breakfast and did not disclose it, the Department’s finding in this regard is not clearly erroneous.

[¶ 17.] The circuit court found that although Meligan did not disclose this fact in his appraisal, it was insufficient as a basis for discipline. The court relied primarily upon the testimony of Tinker that the property was seldom used as a bed and breakfast and more often used as a residence. According to the circuit court, it would have been misleading to portray the property as having any additional value above that of a residence given the fact that Tinker only did a small amount of business as a bed and breakfast.

[¶ 18.] The circuit court’s finding is contrary to the standards set forth in the Fannie Mae Guidelines. The guidelines mandate full disclosure of mixed uses, without regard to the success of the business. The fact that the property was used primarily as a residence did not relieve Meligan of the duty to disclose that it was a mixed use property. In fact, section 306 of the guidelines provides that a mixed use property is only acceptable if it is “primarily residential in nature.” Meligan should have disclosed that the Tinker property was intended to be used as a bed and breakfast, had been used as a bed and breakfast in the past, and may continue to be used as a bed and breakfast in the future.

2. Failure to disclose the Tinker property was a 1930’s barn that had been remodeled.

[¶ 19.] The Department found that Meligan failed to disclose that the residence was a 1930’s barn that had been extensively remodeled. In its findings of fact, the ALJ adopted the testimony of Simpson to support this finding. However, Simpson’s testimony is entirely based on documentary evidence, ie. Meligan’s appraisal. Thus, we review the appraisal de novo and ascertain if it supports Simpson’s opinion.

[¶ 20.] After reviewing the appraisal, we conclude the Department’s finding is clearly erroneous. Attached to Meligan’s appraisal are two pages titled “Footnotes and Addendum.” Footnote 3 describes the property as completely remodeled and having the frame of an “old barn.” We have consistently noted that “[t]he value of the opinion of an expert witness is no better than the facts upon which it is based. It cannot rise above its foundation and proves nothing if its factual basis is not true.” Haynes, 2004 SD 99, ¶ 29, 686 N.W.2d at 664 (quoting Wiedmann v. Merillat Indus., 2001 SD 23, ¶ 17, 623 N.W.2d 43, 47-48). Although the ALJ had a copy of the appraisal, she failed to address footnote 3.

[¶ 21.] On appeal, the Department argues that although Meligan included the information in the footnote, he may not have considered it in the appraisal. The Department also argues that putting this information in a footnote “may be especially misleading to an out of state lender.” However, the Department had the burden of proving this fact by clear and convincing evidence. The footnote expressly refers to the frame being that of an “old barn.” The footnotes and addendum are as conspicuous as the text of the report. Requiring a sophisticated lender to read the entire appraisal report, including the footnotes and addendum, is not too burdensome. The Department’s argument fails in the absence of clear and convincing evidence that this information was either not considered in the appraisal, or placed in the footnote with intent to mislead.

3.Failure to disclose in the primary report that the Tinker barn is a three-story structure.

[¶ 22.] Meligan’s appraisal report does not mention that the Tinker barn is a three-story structure. However, footnote 3 explains that “attic is actually the third floor [and] is not yet finished.” On appeal, the Department argues that it is possible that this representation was made to mislead an out-of-state lender into believing the barn was a traditional two-story structure.

[¶ 23.] The record does not support that assertion. In addition to disclosing that the barn has a third floor, footnote 3 describes the third floor as having a “9'5 ceiling,” “rough in for a bathroom,” and “2 l[arge] windows also roughed in from the inside.” In summary, the Department’s factual finding is correct; Meligan did not refer to the third floor in the primary report. However, the inference that this amounts to intent to mislead is not supported by the documentary evidence and, is therefore error.

4. Failure to include an intended user provision in the appraisal.

5. Failure to discuss that Comparable 3 was not a sale.

6. Listing of an inaccurate address for Comparable 3.

7. Listing of an inaccurate date of sale for Comparable 2.

[¶ 24.] Meligan concedes the above errors and omissions and that they constitute technical violations of USPAP. The circuit court found that they were minor technical violations that did not warrant discipline because they had no effect on the appraisal.

[¶ 25.] The ALJ had the opportunity to listen to the testimony and judge the credibility of the witnesses in this matter. The ALJ rejected Meligan’s defense that his errors and omissions were minor technical violations. Instead, the ALJ accepted Simpson’s expert testimony that these errors, in the aggregate, amounted to an incompetent appraisal. In this respect, the circuit court erred when it substituted its judgment for that of the Department’s. See In re Klein, 2003 SD 119, ¶ 13, 670 N.W.2d 367, 370-71 (rejecting Klein’s identical argument that his violations of US-PAP were minor and warranted no discipline). Indeed, Simpson’s testimony is consistent with USPAP Standard 1 — 1(c) which forbids appraisers from:

rendering] appraisal services in a careless or negligent manner, such as by making a series of errors that, although individually might not significantly affect the results of an appraisal, in the aggregate affect the credibility of those results.

8. Failure to identify the scope of the work.

9. Failure to include a proper certification.

[¶ 26.] When Meligan answered the complaint in this case, he acknowledged that he had provided the Department with a complete version of his appraisal. However, the copy the Department received did not contain a certification or an identification of the scope of the work Meligan performed. Meligan failed to provide the Department with either of these documents throughout these proceedings.

[¶ 27.] At the administrative hearing, Meligan conceded USPAP requires a proper certification and scope of the work document to be included with an appraisal. Meligan, however, claimed that those documents were sent to his client with his original appraisal. The ALJ found that “Meligan’s testimony in this regard is not credible.”

[¶ 28.] On review, the circuit court read the hearing transcript and chose to believe Meligan. As a result, he set aside the ALJ’s credibility determination as clearly erroneous. Because this was an issue of credibility, the circuit court was in error when it substituted its judgment for that of the ALJ’s.

10. Failure to include highest and best use analysis.

[¶ 29.] Simpson testified USPAP required Meligan to include a highest and best use analysis in the appraisal and that Meligan failed to provide one. Meligan’s explanation was that he determined the highest and best use was residential, and then checked the appropriate box accordingly. The ALJ found that Meligan failed to include the proper analysis which was in violation of USPAP. After reviewing the record, we find the ALJ’s finding to be supported by sufficient evidence.

11. Failure to include support for a land value opinion.

[¶ 30.] Meligan concedes that he did not include support for a land value opinion. He testified that he believed one was not necessary unless the land accounted for more than thirty percent of the total value. Simpson disagreed, and testified that Meligan’s omission was a violation of USPAP. The ALJ agreed with Simpson.

[¶ 31.] On review, the circuit court adopted Meligan’s version. Because there was conflicting testimony, the ALJ was in a better position than the circuit court to make this determination. Therefore, the circuit court erred when it rejected this finding.

[¶ 33.] The circuit court erred in reversing all of the Department’s factual findings and vacating the Board’s decision. Meligan may be subject to discipline for the nine errors and omissions that have support in the record. This case should be remanded to the Department to decide the discipline, if any, that should be imposed upon Meligan, consistent with this opinion. On remand, the Department should consider the claim that Meligan’s alleged failure to disclose that the property was a 1930’s remodeled barn was, according to the Department’s own expert, one of the most “paramount troubling issue[s]” with the appraisal. We have found that claim to be erroneous. The Department should also consider the fact that no person or entity relied upon or was harmed by Meligan’s appraisal.

[¶ 34.] GILBERTSON, Chief Justice, KONENKAMP, Justice, and TRIMBLE, Circuit Judge, concur.

[¶ 35.] MEIERHENRY, Justice, concurs in part and dissents in part.

[¶ 36.] TRIMBLE, Circuit Judge, sitting for ZINTER, Justice, disqualified.

MEIERHENRY, Justice

(concurring in part, dissenting in part).

[¶ 37.] I agree that the Department’s decision should be reversed, but I disagree that the case should be remanded. The scope of appellate review is governed by SDCL 1-26-36. On appellate review, courts may affirm, remand the case for further proceedings, or “reverse or modify the decision if substantial rights of the appellant have been prejudiced because the administrative findings, inferences, conclusions, or decisions are: ... (5) Clearly erroneous in light of the entire evidence in the record; or (6) Arbitrary or capricious or characterized by abuse of discretion or clearly unwarranted exercise of discretion.” SDCL 1-26-36. Further, “[a] court shall enter its own findings of fact and conclusions of law or may affirm the findings and conclusions entered by the agency as part of its judgment.” SDCL 1-26-36. Here, the Department’s decision contained clearly erroneous findings of fact and was an abuse of discretion.

[¶ 38.] Judge Gors reviewed this matter and determined that although the appraisal “contained some minor violations of USPAP,” the Department’s penalty was “disproportionately severe since there was no actual harm.” The majority appears to have arrived at much the same conclusion; that is, the violations do not warrant the severity of the penalty. As authorized by SDCL 1-26-36, the trial court entered its own findings of fact and conclusions of law. The majority agrees with some of the trial court’s findings and disagrees with others. Nevertheless, the majority agrees with Judge Gors’ conclusion that the Department abused its discretion. Judge Gors determined that the abuse of discretion warranted reversal. I agree. Consequently, I would affirm the circuit court and reverse the Department’s decision. I would not remand to the Department for further consideration.

      . The amount of the loan Tinker applied for is not in the record and the attorneys could not recall that amount when questioned by the Court during oral arguments.

      . The sign in front of the structure reads "Horse Feathers Lodge.”

      .Acquiring a subsequent appraisal by a different appraiser is common among lenders in the refinancing business.

      . South Dakota’s Administrative Rules governing appraisers require that an appraisal conform to the USPAP. ARSD 20:14:06:01 ("An appraisal must conform to the Uniform Standards of Professional Appraisal Practice, 2002 Edition.”).

      . Meligan appraised the property at $382,000. Swanhorst concluded its value was $260,000. Simpson did not appraise the property.

      . The proposed fine and suspension were based on ARSD 20:14:11:03(10) and (13). ARSD 20:14:11:03 permits the Department to impose discipline for "violating any provision of this article.” Subsection (13) allows for discipline on the grounds of "negligence, refusal, or incompetence in developing ... preparing ... or communicating an appraisal.” The Department also based its sanctions on violations of 20:14:06:01 (failure to conform to USPAP). See supra n3.

      . Department and Meligan raise numerous issues on appeal. We consolidate them to: (1) Whether the Department’s findings were clearly erroneous or irrelevant; (2) Whether there was sufficient evidence to support the Department's sanction; and (3) Whether the circuit court erred in vacating the Department's decision.

      . Both Meligan and Simpson testified that the Fannie Mae Guidelines must be complied with in order to be consistent with USPAP.

      . The circuit court also relied heavily on the fact that Meligan appraised the property for what it was; a residence. Section 306 does provide that the market value of mixed use properties "be primarily a function of its residential characteristics, rather than of the business use or any special business use modifications that were made.” However, that section also mandates that at a minimum, the business use be disclosed in the appraisal. While Meligan may have been correct as to value, that did not excuse him from disclosing how he arrived at the value.

      . USPAP Standard 1—2(f) requires appraisals of real property to "identify the scope of the work necessary to complete the assignment." Standard 2-3 requires an appraisal report to contain a signed certification.

      . The circuit court found this finding to be clearly erroneous. However, it only points to Meligan’s testimony that he "checked highest and best use.” USPAP Standard 1—3(b) requires an appraiser to “develop an opinion of the highest and best use of the real estate.”

      .We cannot find anything in the USPAP Standards or comments to the Standards that support Meligan's assertion.

      . Policy Statement 10(e) of the Policy Statements of the Appraisal Subcommittee notes, "financial loss or the lack thereof is not an element in determining whether there is a USPAP violation; the extent of such loss, however, should be a factor in determining the appropriate level of discipline.”


author: MEIERHENRY, Justice.

text:
    2006 SD 24
    Patrick R. HALL and Marlyn G. Erickson and Fuel Food Mart, Inc., a South Dakota Corporation, Plaintiffs and Appellants, v. STATE of South Dakota, by and through the SOUTH DAKOTA DEPARTMENT OF TRANSPORTATION and the South Dakota Department of Transportation Commission, Defendant and Appellee.
    No. 23465.
    Supreme Court of South Dakota.
    Argued on Nov. 8, 2005.
    Decided March 15, 2006.

      Jeffrey G. Hurd of Bangs, McCullen, Butler, Foye & Simmons, Rapid City, South Dakota, Brian W. Blaesser of Robinson & Cole, LLP, Boston, Massachusetts, Attorneys for plaintiffs and appellants.
    Karla L. Engle, Department of Transportation, Pierre, South Dakota, Attorneys for defendant and appellee.
   MEIERHENRY, Justice.

[¶ 1.] The owners of the Flying J Truck Stop (Flying J) claim that the closing of the Exit 66 interchange on Interstate 90 (1-90) by the South Dakota Department of Transportation (SDDOT) constitutes an inverse condemnation entitling them to compensation. The trial court granted summary judgment against the owners. We reverse and remand.

FACTUAL AND PROCEDURAL BACKGROUND

[¶ 2.] Patrick R. Hall, Marlyn G. Erickson, and Fuel Food Mart, Inc. (Owners) own land which abuts both 1-90, an east-west road, and Ellsworth Road, a north-south road, near Box Elder, South Dakota. On that property, Owners operate the Flying J, a convenience store and filling station. Originally, Exit 66 served as the interchange between 1-90 and Ellsworth Road. That exit connected 1-90 to Ells-worth Road, the main north-south route between 1-90 and the main entrance to Ellsworth Air Force Base (Ellsworth) and the city of Box Elder.

[¶ 8.] Originally, Pennington County, the governmental body with jurisdiction over the area, prohibited development around the Exit 66 interchange. Subsequently, the city of Box Elder added the area to its jurisdiction and allowed development. In the 1970’s, however, the development around the Exit 66 interchange became a concern. That development encroached upon the “Accident Potential Zone” (APZ) off the main runway of Ells-worth. An APZ is an area at the end of a runway at an air force installation which is exposed to possible aircraft accidents. Encroachments into an APZ are generally referred to as “incompatible land uses.”

[¶ 4.] Two separate studies were done to address the encroachment concerns. The first study, the Joint Land Use Study (JLUS), was commissioned by the communities surrounding Ellsworth in June 1995. Its purpose was “to identify, analyze, and to the extent possible, resolve encroachment issues associated with the development of [the area surrounding Ellsworth].” After considering several alternatives, the study recommended closing Exit 66 and constructing a new interchange one mile east of Exit 66 so that the incompatible land uses near the existing exit “would be relocated in the vicinity of the new interchange.”

[¶ 5.] The second study was commissioned by the Rapid City Area Metropolitan Planning Organization and the SDDOT. It was entitled Exit 67/1-90 Interchange Justification Study (IJS) and sought to assess “the need for the new interchange, the best design for the interchange, and its effects on the surrounding roadway system and community.” The IJS also provided several alternative recommendations and ultimately recommended closing Exit 66 and constructing a new interchange one mile to the east. Like the JLUS, all of the IJS alternatives considered the effect on incompatible development.

[¶ 6.] In light of these studies, SDDOT constructed Exit 67 one mile east of Exit 66. On October 1, 2003, Exit 66 was closed and all access to 1-90 was removed at that location. As a result, Flying J suffered drastic drops in sales. On October 21, 2003, Owners closed Flying J indefinitely.

[¶ 7.] Owners then brought this inverse condemnation claim against the SDDOT and the Department of Transportation Commission (collectively State) alleging that the relocation of Exit 66 was a taking of private property requiring compensation. Upon cross-motions for summary judgment, the trial court found for the State. Owners now appeal and frame the issues as follows: (1) Should the State be obligated to pay just compensation for depriving Owners of their right of access to a public highway by closing the highway interchange abutting their property? (2) Was the State’s action in closing the highway interchange abutting the Owners’ property for the acknowledged purpose of shutting down Owners’ business an abuse of the State’s police power?

DECISION

[¶ 8.] We review the trial court’s grant of summary judgment as follows:

Summary judgment is authorized “if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” All reasonable inferences derived from the facts are viewed in the light most favorable to the nonmoving party. However, the nonmoving party must present facts showing that a genuine and material issue for trial exists. Once we determine that the material facts are undisputed, our review is limited to whether the law was correctly applied. We will affirm the trial court if there is any legal basis to support its ruling. Id.

Krier v. Dell Rapids Twp., 2006 SD 10, ¶ 12, 709 N.W.2d 841, 844-45 (citations omitted). If the material facts are undisputed, whether a taking occurred is a question of constitutional law which we review de novo. See State v. Stanga, 2000 SD 129, ¶ 8, 617 N.W.2d 486, 488.

[¶ 9.] Our first inquiry is whether the material facts are undisputed. Unfortunately, the parties did not indicate in the record what they considered as undisputed facts. Nevertheless, the trial court gleaned certain facts from the record on which he based his ruling. In a written decision, the trial court identified the facts as follows: (1) an APZ existed off the end of runway of Ellsworth; (2) for a long time development was limited; (3) after the city of Box Elder annexed the property, development was permitted; (4) Owners of Flying J were among the businesses developed in the area; (5) the commercial development and high traffic use of the area was of concern to the Air Force because it invaded the APZ; (6) the Base Closure Commission identified development in the APZ as a matter of concern affecting Ellsworth’s long-term viability as an Air Force base; (7) two land use studies led to development of a highway construction project designed to close Exit 66 and to build a new interchange at Exit 67; (8) as a result of closing Exit 66, direct access from Ellsworth Road to and from 1-90 was lost; (9) Owners’ access to Ellsworth Road remained unchanged. Additionally, at the summary judgment hearing, the trial court surmised that “probably the purpose of closing the exit [was] to eliminate or radically reduce the commercial value; and therefore, the co-exploitation of those lands,” with “the ultimate expectations [that] the businesses would diminish if not vacate entirely.” The trial court further stated:

[A]t this stage it appears that that goal has been largely accomplished with the closure of the exit. Those businesses have no direct access to the interstate. They abut a road running north and south from Box Elder to the air base. And that road, the road which they abut, has had access to the interstate at the interchange which was closed; that the closure of that interchange has a significant adverse impact on the traffic flow past those businesses.

The trial court asked the State, “If there was no threat of Ellsworth being closed or subject to closure, would anybody have addressed the public safety issue?” The State’s lawyer answered, “I can’t speak on behalf of- all of the entities that made up the joint land use study that came up with the recommendations. I think I can safely say that the Department of Transportation would not have on its own acted to close exit 66 and build exit 67.”

[¶ 10.] Based on the above facts, the trial court concluded as a matter of law “that since [Owners] did not have a property interest in the continued flow of traffic past [their] business, there has been no taking or damaging of [Owners’] property that is compensable.” The trial court relied exclusively on Darnall v. State, 79 S.D. 59, 108 N.W.2d 201 (1961), in support of its ruling. The trial court noted that the maintenance of heavy traffic in the APZ posed a threat to the economic viability of Ellsworth. The court further stated, “In any event, where access is going to be allowed to the interstate system is within the proper exercise of the state’s police power and does not give rise to a compen-sable taking.”

[¶ 11.] On appeal, the State asserted and argued for the first time that Owners had no right of access to the interstate and interchange at Exit 66 because 1-90 is a controlled-access highway. In support of its argument, the State pointed to SDCL 31-8-1 and SDCL 31-8-6. This particular assertion, however, was not raised in the pleadings, in the record, or in the State’s arguments to the trial court. Clearly, the trial court did not address this specific issue at the hearing or in its written decision. The trial court’s ruling was based exclusively on an analysis of whether the businesses had a right to the continued flow of traffic and whether closing the exit was a proper exercise of police power.

[¶ 12.] We have repeatedly stated that we will not address for the first time on appeal issues not raised below. See, e.g., Action Mech., Inc. v. Dead wood Historic Pres. Comm’n, 2002 SD 121, ¶ 50, 652 N.W.2d 742, 755 (“An issue not raised at the trial court level cannot be raised for the first time on appeal.”); Sedlacek v. S.D. Teener Baseball Program, 437 N.W.2d 866, 868 (S.D.1989) (stating that where a party “failed to develop the record” on an issue “we deem that issue abandoned”); Fortier v. City of Spearfish, 433 N.W.2d 228, 231 (S.D.1988) (“Since this issue was not framed in the pleading and was not addressed by the affidavits in support of or resistance to the motion for summary judgment, we do not believe the issue was properly before the trial court. Therefore, we will treat the issue as not being properly before us-”). To raise a legal argument on appeal in an answering brief without first addressing it below puts the adverse party at an extreme disadvantage. Had the issue been raised below, the parties would have had an opportunity to consider whether additional evidence was needed to decide the issue and certainly would have had an opportunity to brief the issue for the trial court’s consideration. Likewise, the trial court would have been made aware of the issue and given an opportunity to rule on it. Moreover, since the argument was first raised by the State in its answering brief to this Court, the opposing parties’ ability to respond was limited to its reply brief. For these reasons, we decline to review this particular argument proffered by the State. Cf. Williams v. Maulis, 2003 SD 138, ¶¶ 25-28, 672 N.W.2d 702, 707-08 (refusing to review an issue properly noticed for review by an appellee where the appellant failed to file a reply brief and therefore failed to address the issue and where “the trial court did not address the issue because it granted summary judgment on other grounds”). Consequently, we will only review the issues that were presented to and determined by the trial court: (1) whether Owners are entitled to compensation from the State for the closing of Exit 66, and (2) whether closing the exit was a proper exercise of police power.

[¶ 13.] The United States Constitution provides that private property shall not “be taken for public use, without just compensation.” US Const amend V. Article VI, Section 13 of the South Dakota Constitution mirrors the federal constitution and states that “[p]rivate property shall not be taken for public use, or damaged, without just compensation.” As we recently clarified, the damage clause of our constitution provides a remedy additional to that provided by the federal constitution. Krier, 2006 SD 10, ¶¶ 23-25, 709 N.W.2d at 845. Krier reaffirmed that

[I]t is a basic rule of this jurisdiction governing compensation for consequential damages that where no part of an owner’s land is taken but because of the taking and use of other property so located as to cause damage to an owner’s land, such damage is compensable if the consequential injury is peculiar to the owner’s land and not of a kind suffered by the public as a whole.

Id. ¶ 23, 709 N.W.2d at 847 (citing State Hwy. Comm’n v. Bloom, 77 S.D. 452, 461, 93 N.W.2d 572, 577 (1958)) (emphasis added).

[¶ 14.] Accordingly, the damage clause of the South Dakota Constitution allows a property owner to seek compensation “ ‘for the destruction or disturbance of easements of light and air, and of accessibility, or of such other intangible rights as he enjoys in connection with and as incidental to the ownership of the land itself.’ ” Hurley v. State, 82 S.D. 156, 161, 143 N.W.2d 722, 725 (1966) (quoting 2 Nichols on Eminent Domain § 6.44). As we have explained, “an owner of land abutting on a conventional street or highway has certain private rights in the street or highway distinct from that of the general public.” Hurley, 82 S.D. at 160, 143 N.W.2d at 724 (citing 29A CJS Eminent Domain § 105(1)). The right of access is one of those private property rights and, therefore, cannot be taken for public use or materially impaired without compensation. Id. (citing 29A CJS Eminent Domain § 105(2)); see also Darnall, 79 S.D. at 66-68, 108 N.W.2d at 204-06; Hyde v. Minn. D. & P. Ry. Co., 29 S.D. 220, 136 N.W. 92, 100-01 (1912); Edmison v. Lowry, 3 S.D. 77, 52 N.W. 583, 584-85 (1892).

[¶ 15.] In two of our prior cases, we have specifically considered the right of access in the context of interstate highways. See Hurley, 82 S.D. at 158, 143 N.W.2d at 722; Darnall, 79 S.D. at 61, 108 N.W.2d at 202. In Darnall, the facts did not support a compensable claim. 79 S.D. at 70, 108 N.W.2d at 207. In that case, the plaintiffs owned property which abutted the west side of State Highway 79, which ran north and south. 79 S.D. at 61, 108 N.W.2d at 202. The State constructed a controlled-access interstate highway on the east side of Highway 79. Id. A newly constructed curb separated the interstate and Highway 79 in order to prevent traffic on the interstate from directly entering Highway 79 and the plaintiffs’ property. Id. The only access from the interstate to Highway 79 was either an interchange one mile north or an interchange one mile south of plaintiffs property. Id. On appeal, we reversed the jury verdict for the landowner and remanded for dismissal. 79 S.D. at 70-71, 108 N.W.2d at 207. Although recognizing the plaintiffs’ right of access to the abutting highway, we noted that no part of that highway was closed, and the plaintiffs’ access to it was not changed. 79 S.D. at 69, 108 N.W.2d at 206. Traffic could still get to the property by either interchange, and the plaintiffs’ “only complaint [was] that they [did] not have direct and immediate access to the new Interstate Highway; and inversely, that travelers on it [did] not have the unrestricted right of direct access to their business establishment.” 79 S.D. at 67, 108 N.W.2d at 205. We noted, however, that “[c]ircuity of travel is not a compensa-ble damage under these circumstances; it is a burden shared by all the traveling public.” Id. Thus, we concluded that “where there is no physical taking and the owner’s access to the highway on which he abuts is not unreasonably diminished or interfered with, his loss is due to the diversion of traffic, a lawful exercise of the police power and there can be no recovery.” 79 S.D. 59 at 70, 108 N.W.2d at 207.

[¶ 16.] Shortly after the Damall decision, in a case involving a slightly different fact scenario, we concluded that a taking had occurred. Hurley, 82 S.D. at 164, 143 N.W.2d at 726. In Hurley, the plaintiffs’ property was located on the corner of two streets. 82 S.D. at 159,143 N.W.2d at 724. Omaha Street bordered the property on the south, while West Boulevard bordered the property on the east. Id. While the plaintiffs were negotiating with oil companies to build a service station on the property, West Boulevard was converted from a conventional street into part of a controlled-access interstate highway. 82 S.D. at 159, 164, 143 N.W.2d at 724, 726. To accomplish the conversion, the state erected a steel barrier along the entire eastern edge and for a short distance on the southern edge of the property. 82 S.D. at 159, 143 N.W.2d at 724. The barrier precluded access to West Boulevard from the plaintiffs’ property leaving access only to westbound traffic on Omaha Street. Id.

[¶ 17.] In analyzing the plaintiffs’ takings claim, we noted that the proper exercise of police power must be reasonable and cannot be arbitrary. 82 S.D. at 163, 143 N.W.2d at 726. We said:

In each case, therefore, the relative rights of the public and private interests must be considered and the reasonableness of the regulation and the degree of its interference with private property determined. If, after the construction of a public improvement an abutting landowner continues to have reasonable access to his property, he has no compensable complaint. But if the right of access is destroyed or materially impaired, the damages are com-pensable if the injury sustained is peculiar to the owner’s land and not of a kind suffered by the public generally. In other words, police regulations must be reasonable, and the legislature cannot, under the guise of the police power, impose unreasonable or arbitrary regulations which go beyond that poiuer, and in effect deprive a person of his property within the purview of the law of eminent domain, as by depriving the owner of all profitable use of the property not per se injurious or pernicious, restricting the lawful uses to which the property can be put and destroying its value, permanently so restricting the use of the property that it cannot be used for any reasonable purpose, or completely destroying the beneficial interest of the owner.

Id. (citing 29A CJS Eminent Domain § 6). Based on the facts, we held that the State’s actions were compensable because the plaintiffs’ right of access was substantially impaired and “[tjheir damages were different in kind and not merely in degree from that experienced by the general public....” 82 S.D. at 164, 143 N.W.2d at 726.

[¶ 18.] Although Hurley and Dar-nall reach different results, both cases apply the same legal principles. Hurley and Damall recognize that a landowner’s right of access and the state’s police power to regulate highways often conflict. This conflict clearly manifests when the state eliminates an abutting landowner’s highway access. As we said in Damall, “ ‘[t]he line between those two concepts[ — right of access and the state’s police power — ]is far from clearly marked.’ ” 79 S.D. at 68, 108 N.W.2d at 205 (citation omitted). Without a clear delineation, the relationship between the rights of the- property owner and the rights of the state must be considered in light of the facts of each case. Therefore, in each case, “the relative rights of the public and private interests must be considered and the reasonableness of the regulation and the degree of its interference with private property determined.” Hurley, 82 S.D. at 163, 143 N.W.2d at 726.

[¶ 19.] Both Damall and Hurley give guidance on the considerations which impact the relative rights of the public and private interests. One consideration when assessing the landowner’s interest is the extent to which the landowner’s access is diminished. In Damall, we concluded that the access to the highway was “not unreasonably diminished or interfered with.” 79 S.D. at 70, 108 N.W.2d at 207. In Hurley, however, the landowner’s access was “substantially impaired.” 82 S.D. at 164, 143 N.W.2d at 726. Another consideration is whether the landowner’s damages are “different in kind and not merely in degree from that experienced by the general public.” Id. As we stated:

This basic rule has long been recognized in South Dakota, i.e., even though no part of private property is physically taken the landowner is entitled to compensation under the taking and damaging clause of our constitution (§ 13, Art. VI) when the construction of a public improvement causes damage to property “if the consequential injury is peculiar to the owner’s land and not of a kind suffered by the public as a whole.

82 S.D. at 161,143 N.W.2d at 725 (citations omitted). Additionally, consideration must be given to the reasonableness of the exercise of the state’s police powers. As we recognized in Hurley,

“[The state] cannot, under the guise of the police power, impose unreasonable or arbitrary regulations which go beyond that power, and in effect deprive a person of his property within the purview of the law of eminent domain, as by depriving the owner of all profitable use of the property not per se injurious or pernicious, restricting the lawful uses to which the property can be put and destroying its value, permanently so restricting the use of the property that it cannot be used for any reasonable purpose, or completely destroying the beneficial interest of the owner.”

82 S.D. at 163, 143 N.W.2d at 726 (quoting 29A CJS Eminent Domain § 6, p. 182).

[¶ 20.] Here, the trial court limited his analysis to whether the Owners had a property right to passing traffic. The trial court did not consider whether Owners still had reasonable access, whether their access was materially impaired, or whether their injury was peculiar to their land and not of a kind suffered by the public generally. Also, the court did not address whether the State’s action was arbitrary or unreasonable. Undoubtedly, the trial court’s analysis was hindered by the parties’ failure to thoroughly address the issues or offer sufficient evidence. In their brief, Owners stated only in passing that a loss of access caused their damages; they focused their argument on the State’s intent to damage the economic value of their property. In response, the State focused its argument on the premise that Owners had no property right in passing traffic. It is clear from the record that the parties rushed to summary judgment. Even the trial court, at the summary judgment hearing, stated “I am comfortable in running a summary judgment up for the Supreme Court to rule because I think they are going to have to.”

[¶ 21.] This hurried effort was ill advised. The Owners’ complaint specifically challenged the loss of reasonable and convenient access to 1-90, yet that particular issue was not addressed by the trial court’s summary judgment decision. Further, while both parties asserted that the case presented no genuine issues of material fact, they appear to disagree on the purpose of the State’s action. The State’s purpose, however, is material in determining whether the State’s exercise of police power was unreasonable and arbitrary. Because of the inadequate development of the record, the failure to properly recognize the issues presented, and the lack of a thorough consideration of the applicable law, our review is hindered, and we cannot determine whether, as a matter of law, the closing of Exit 66 constituted a compensa-ble taking. Consequently, we reverse the summary judgment and remand the case for further proceedings.

[¶ 22.] GILBERTSON, Chief Justice, and SABERS, KONENKAMP, and ZINTER, Justices, concur.

      . In support of its motion, the State filed the affidavit of Dennis Landguth, SDDOT Secretary, to which diagrams of the Exit 66/1-90 interchange were attached. In support of their motion for summary judgment, Owners submitted the affidavit of Marlyn Erickson, one of the landowners, and the affidavit of John Haeder, an appraiser. As attachments to their summary judgment brief, Owners also submitted portions of the following: the JLUS report, the IJS report, the deposition of Dennis Landguth, SDDOT Secretary, and the deposition of Leon Schochemaier, an SDDOT engineer. As we have stated, "SDCL 15 — 6— 5(d) excludes trial briefs from the original of all papers to be filed.” Fortier v. City of Spearfish, 433 N.W.2d 228, 231 (S.D. 1988); see also SDCL 15-6-5(d) ("The original of all papers, excluding briefs or memorandums of law thereof, served upon a party or presented to any court or judge in support of any application or motion ... shall ... be filed with the court”) (emphasis added). Therefore, the trial briefs were erroneously included’ in the record submitted to this Court. The only evidence properly before the trial court — and therefore before this Court — was the affidavit of Marlyn Erickson, the affidavit of John Hae-der, and the affidavit of Dennis Landguth and its attachments. SDCL 15-6-56(c) (allowing summary judgment to “be rendered forthwith if the pleadings, depositions, answers to interrogatories, and' admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact”) (emphasis added).

      . SDCL 31-8-1 defines a "controlled-access facility" as:
      A highway or street especially designed for through traffic, and over, from, or to which owners or occupants of abutting land or other persons have no right or easement or only a controlled right or easement of access, light, air, or view by reason of the fact that their property abuts upon such controlled-access facility or for any other reason.
      Additionally, SDCL 31-8-6 provides:
      No person shall have any rights of ingress or egress to, from or across controlled-access facilities to or from abutting lands, except at such designated points at which access may be permitted, upon such terms and conditions as may be specified from time to time.
      We have not had occasion to interpret or apply these laws since they were passed by the Legislature in 1953. Consequently, there is no settled law or authority interpreting these statutes to mean that a landowner whose property abuts a controlled-access highway is legally barred from claiming damages for inverse condemnation in circumstances where a previously controlled right of access is taken away.

      .After the State conceded that absent the joint land use study, it would not have acted on its own to close Exit 66, the trial court stated, “I don't know that [the State's purpose is] supported in the record in any way, shape or form, but [it] certainly is an interesting question.” Thus, the trial court also recognized the existence of genuine issues of material fact.

      . The trial court itself recognized that "[i]f the motivation is a factor, then I think we have other facts to address.”

      . Generally, "we will affirm the trial court if there is any legal basis to support its ruling.” Krier, 2006 SD 10, ¶ 12, 709 N.W.2d at 845. In this case, however, the legal basis now asserted by the State was not presented to the trial court. Therefore, the trial court had no opportunity to develop the facts which would allow us to address the position espoused by the State. Consequently, we cannot determine whether this newly argued legal theory would support summary judgment,