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Local jury awards $500,000 to Highlands family

Construction of golf course ruined lake, jurors say

By Lynn Hotaling

Young Lake, Jackson County

A local jury found in favor of a Highlands family March 13 and awarded them $500,000 in what is believed to be the largest damage award ever given in Jackson County. Earl and David Young, owners of an 18-acre lake in southern Jackson County, sued the developers of Highlands Cove, charging them with trespass, irreparable harm to the Youngs' property and violation of the Sedimentation Pollution Control Act of 1973. Built in 1957, the lake (above in May 1998) was sparkling clean for more than 40 years until construction of Highlands Cove golf course began upstream, the Youngs say; now every rainfall turns their lake muddy. The aerial view of Young Lake (below), which shows construction at Highlands Cove in the upper right corner, was taken in November 1998. The close-up (bottom) of muddy water exiting the lake was taken one month earlier. Lawyers for Highlands Cove argued that the development had obtained all the proper state permits and had never been cited for non-compliance by state inspectors. Photos like these helped convince juror Robin Schaeffer of Sylva to decide in the Youngs's favor, she said. Evidence presented during the six-day trial indicated the fine soil of the Highlands Cove site was unsuitable for development, Schaeffer said.

In what is believed to be the largest award ever handed down in Jackson County, a local jury March 13 gave a Highlands family $500,000 in compensation for damage to their lake.

Plaintiff Whiteside Estates, a family corporation represented by Earl and David Young of Highlands, proved to the jury's satisfaction that construction at Highlands Cove, a planned golf course and residential community upstream, caused irreparable harm to 18-acre Young Lake.

Both the Youngs' property and Highlands Cove are located in southern Jackson County near the intersection of U.S. 64 and Norton Road between Cashiers and Highlands.

The jury considered awarding even more money to the Youngs, said juror Robin Schaeffer of Sylva. Damages of around $2 million were favored by most members of the jury, she said, with the half-million dollar verdict a compromise with a juror who held out for a lower award.

Before-and-after photographs of the lake, plus evidence from experts about the turbidity (amount of particulate matter suspended in a given amount of water) and loss of wildlife, convinced her to find in favor of the Youngs.

"(The trial) was really fascinating," Schaeffer said. "I listened hard - I've always been interested in science."
Much of the evidence had to do with particulater matter suspended in the water and its negative impact on fish and wildlife habitats, she said.

The higher damage award was considered because of evidence that indicated the Youngs would have to install a $1.6 million treatment plant to restore their lake to its former quality.

"We wanted to give them $1.6 million for the treatment plant plus some money for their loss," Schaeffer said.

Billy Clarke of Asheville, attorney for the plaintiff, praised the jury for its attentiveness and said he is pleased with the verdict.

Highlands Cove, on the other hand, is not satisfied and intends to file a motion for a new trial, said Highlands attorney Zeke Sossamon, who represents Highlands Cove LLC. The motion will be based on the developer's contention that the jury verdict is excessive in light of the instructions given by the court, Sossamon said.
Young Lake, Jackson County
Young Lake, Jackson County Based on the new motion, Judge Marlene Hyatt could set aside the verdict, reduce the amount of damages (with plaintiff's consent) or rule for a new trial. Should the new trial motion be denied, Highlands Cove will appeal, Sossamon said.

"I'm not surprised they'll appeal, but I think it will stand appeal," Clarke said. "It's a jury verdict that shouldn't be disturbed."
Constructed by Earl Young during the 1950s, Young Lake was crystal-clear until October 1998, three months after the advent of earth moving for Highlands Cove, according to trial testimony. Water flows into the lake from Grassy Camp Branch, which has its headwaters on the Highlands Cove property. Grassy Camp Branch is a tributary of Norton Creek, which flows into Glenville Lake, and is part of the Tuckaseigee watershed that provides drinking water to most of Jackson County.

The lake, long a source of recreation for the Young family, is no longer fit for swimming or boating, witnesses for the plaintiff said. Earl Young offered emotional testimony about the lake's intrinsic value to his family, and the joy they had derived from it over the past 40 years, Schaeffer said.

The jury found in favor of the Youngs on all three of the suit's issues: trespass - allowing silt, contaminants and sediment to "cross into, enter into and pollute" Grassy Camp Creek and Young Lake; nuisance - interfering with the use and enjoyment of the Youngs' property; and violating the Sediment Pollution Control Act of 1973, a state statute that requires controls "sufficient to retain sediment generated by the land-disturbing activity within the boundaries of the tract during construction and development of said tract." That law provides civil remedy for individuals who can show that their property has been injured through the initiation and continuation of land-disturbing activity, according to documents on file in the Jackson County Clerk of Court's office.

Lawyers for the development maintained that they were not in violation of the act because they were never cited for any violations despite numerous visits by inspectors from the N.C. Department of Environment and Natural Resources. Another defense was that sedimentation had not increased significantly over pre-construction levels.

However, the plaintiffs presented statistical evidence with regard to turbidity levels before and after construction began at Highlands Cove, juror Schaeffer said. To support trout populations, stream turbidity levels should be around 10 nephelometric units above background, Clarke said. After golf course construction began, he said, turbidity levels of from 75 to 2,200 NTU were measured downstream. Trial testimony indicated Grassy Camp Creek's population of native brook trout has been harmed by land-disturbing activity at Highlands Cove.

Disagreement with state enforcement of turbidity standards has led the Youngs to file a complaint with the N.C. Department of Environment and Natural Resources in addition to their civil lawsuit.

DENR allows developers to exceed turbidity standards so long as an approved sedimentation/erosion plan is in place, Clarke said. Instead of requiring adherence to an absolute standard like 10 NTU for trout streams, the agency allows developers to satisfy requirements through Best Management Practice. Land-disturbing activity is said to be in compliance as long as a sedimentation and erosion plan is in place and developers are following BMPs, Clarke said.

"The rule about how (the state) measures compliance with regard to turbidity standards is not adequate," Clarke said. "Our goal is to make sure (Highlands Cove) doesn't exceed appropriate water quality standards for turbidity."

Other evidence presented at trial indicated that Highlands Cove did not always follow its own sedimentation/erosion plan.

Consultant Kenneth Wagner testified that all elements of the sedimentation plan were not in place before land-disturbing activity was begun. In addition, he said, some portions of the silt fences were not installed to specifications.

Also, state inspectors approved work on a couple of occasions when their own reports indicate the work was not in compliance, Clarke said.

"It seemed like (Highlands Cove) was trying, but lots of things weren't done right," juror Schaeffer said. "The end result is the lake got ruined."

Mike Goodson, an assistant regional engineer with DENR's land quality section, does not share that view.

"In our opinion, the (Highlands Cove) golf course did an exellent job of erosion control," Goodson said. "The law is designed to minimize the impact of construction, and I think they achieved that."

After a January hearing, administrative law Judge Beecher Gray gave a preliminary ruling supporting the Youngs' contention that state standards are not providing adequate protection for streams like Grassy Camp Creek and indicating he would make a recommended decision to the state Environmental Management Commission, Clarke said. Judge Gray has not yet issued a written ruling, according to his law clerk. A hearing before the EMC is expected.

Highlands Cove attorney Sossamon agreed with Clarke's interpretation of Judge Gray's informal ruling, but said the EMC, a state agency charged with enforcement of water quality standards, is not required to accept the judge's recommendation.

Property owner David Young appears determined to persevere in his efforts to stop erosion upstream of his family's lake.

"(This verdict) is a good beginning, but we still have a very muddy lake. The door is wide open for continuing to sue," David Young said. "It's not about money - if they're entitled to a golf course, we're entitled to a clean lake."

Construction at Highlands Cove, which Sossamon said will include a full-size, 18-hole, public golf course, restaurant and clubhouse, began in July 1998. Sixteen of a possible 72 condominiums have been completed, but none have been sold, and up to 200 adjacent residential lots are planned, Sossamon said.

The golf course is finished and completely sodded, according to attorney Sossamon, with a target opening date set for May 1. Sossamon described the new golf course as "beautiful" and said it offers spectacular views of Devil's Courthouse and Whiteside Mountain.

Highlands Cove's local developers are Joe Bell and Bill Pike of Highlands. Significant financial backing for the development is from Sidney McDonald of Arab, Ala., Sossamon said.

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