If a private group offers to donate land to North Carolina for state park use, and the state begins the acquisition process but then learns the Department of Transportation wants the same parcel for a highway, has the state already acquired the land?

Plain-English summary

The Triangle Land Conservancy wanted to donate a parcel near Umstead State Park to the state. The Department of Administration's State Property Office, acting on an agency request, got Council of State approval to "further investigate" the acquisition. During that investigation, the Department learned that the parcel lay within a proposed right-of-way for a Department of Transportation highway project. The State Property Office told its outside legal counsel to halt the acquisition. No deed was ever delivered to the state.

Representative Joe Hackney asked the AG: has the state already acquired this property under N.C.G.S. § 146-26?

Chief Counsel John R. McArthur and Special Deputy AG T. Buie Costen answered no, for two independent reasons.

Delivery and acceptance are required for title to pass. Following Webster's Real Estate Law in North Carolina § 10-58 (4th ed. 1994), "there is no complete 'delivery' until the deed is 'accepted'." The state never accepted delivery; the Property Control Division instructed counsel not to proceed. Title cannot pass without that acceptance step.

§ 146-26 does not apply to acquisitions initiated by agency request. The structure of Chapter 146 is sequential: (1) agency request under § 146-23, (2) Department of Administration investigation under § 146-24, (3) Council of State approval, (4) execution and acceptance of the deed. § 146-26 is a separate protective rule that addresses devises and donations made unilaterally to the state (e.g., in a will). It provides that no such devise vests title until the Governor and Council of State accept. The AG read § 146-26 as a backstop, not as the operative rule for agency-initiated acquisitions. The operative rule for those is the full investigation-and-execution process in §§ 146-22 to 146-24.

The Council of State's earlier vote to approve "further investigation" does not constitute acceptance of the donation. The Department of Administration retains independent authority and obligation to investigate whether the acquisition serves the state's best interest. Per Martin v. Thornburg, 320 N.C. 533 (1987), the Council of State cannot direct the Department of Administration to acquire property. And § 146-24(b) prohibits conveyances "to a particular state agency or to the State for the use and benefit of a particular state agency." The donor's wish to have the land used as part of Umstead State Park does not bind the state to that use; the state must remain free to allocate land it acquires for whatever purpose is in the state's best interest.

The AG declined to answer Representative Hackney's follow-on questions about future use of the parcel for Umstead because those questions presupposed that the state had already acquired it. With no acquisition, the allocation questions did not arise.

Currency note

This opinion was issued in 1996. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here. The state real property acquisition statutes (Chapter 146) have been amended on multiple occasions since 1996. The State Property Office's procedural rules have also evolved. Anyone facing a current state land donation question should consult the current versions of N.C.G.S. § 146-22 et seq. and the State Property Office's published policies.

Background and statutory framework

North Carolina's state-property statutes reflect a structural goal: preventing state agencies, donors, or the Council of State from creating land obligations that the state's overall property management would not approve. The Department of Administration is the gatekeeper. The Council of State (Governor plus the elected Council members) approves acquisitions, but cannot direct them. Donors can offer land, but cannot bind the state to use it for a specific purpose unconditionally.

The Umstead-tract situation captures the tension that the statutes are designed to handle. A private conservation group identified a parcel adjacent to Umstead State Park that would be a natural addition to the park. They wanted to donate it on condition (or with strong expectation) that it be used as parkland. But when the state began due diligence, it learned that the parcel was also wanted for a major DOT project. The two uses (park, highway) are incompatible. The state had to choose, and the statutes leave that choice to the state, not to the donor.

The AG's reading of § 146-26 preserves the state's flexibility. If § 146-26 alone could complete acquisition once a Council of State vote happened, donors could trap the state by getting a Council vote early in the process and then sending an executed deed via U.S. mail. The state would be locked in. The AG's reading prevents that: title passes only on delivery and acceptance after the full investigation and best-interest determination.

The Martin v. Thornburg precedent is important. The case is the leading NC authority on the limits of Council of State power over property acquisition. The Council can approve or veto; it cannot direct the Department of Administration to acquire. That structural rule is what allowed the State Property Office to stop the Umstead acquisition even though the Council had earlier approved investigation.

The opinion is most relevant to donors and conservation groups working with the state. It teaches that the early Council of State vote is permission to proceed, not a binding commitment to acquire. Donors should expect the state to walk away if subsequent investigation surfaces problems.

Common questions

What is a "delivery and acceptance" of a deed?

In NC real property law, conveyance requires two acts: the grantor's delivery of the executed deed with intent to pass title, and the grantee's acceptance. Acceptance can be express or implied from conduct, but mailing a deed to a party who has not agreed to receive it does not count. The state's instruction to its lawyers to stop processing the deed was an affirmative non-acceptance.

Could the donor have forced the state to accept the deed?

No. A donor has no power to compel acceptance. The donor can offer; the state can decline. If the donor wants enforceable terms, the donor needs a contract with the state, not a unilateral conveyance. The conditional-donation device sometimes attempted (deed says "if state stops using it as a park, title reverts to donor") is enforceable as between the parties if the state has actually accepted, but only with affirmative acceptance.

What happens to the land now if the state doesn't accept the donation?

It remains the donor's property. The donor can offer it to another buyer or donor, hold it, or restructure the offer. The Triangle Land Conservancy in this matter retained its options. The DOT highway project would have to negotiate a separate acquisition with the conservancy if it proceeded.

Why does § 146-24(b) prohibit conveyances to a particular agency?

So that the state can manage its land portfolio cohesively. If donors could direct that land go specifically to one agency (say, Parks and Recreation), the Department of Administration could not redirect it to a higher-and-better use (say, agency consolidation, future highway, or surplus disposition). Maintaining state-level allocation discretion was a deliberate legislative choice.

Source

• Landing page: https://ncdoj.gov/opinions/acquisition-of-real-property-by-the-state-of-north-carolina/

Citations

• N.C.G.S. § 146-22
• N.C.G.S. § 146-23
• N.C.G.S. § 146-24
• N.C.G.S. § 146-26
• N.C.G.S. § 143-341(4)g
• Martin v. Thornburg, 320 N.C. 533 (1987)

Original opinion text

March 15, 1996

Representative Joe Hackney
North Carolina General Assembly
Post Office Box 1329
Chapel Hill, North Carolina 27514

Re: Advisory Opinion; Acquisition of Real Property by the State of North Carolina; G.S. § 146-22 et seq.; G.S. § 146-26

Dear Representative Hackney:

Your letter of November 17, 1995, posed a number of questions regarding the above transaction. Subsequent to our reply letter of December 1, 1995, you indicated in a telephone conversation that you desired a more formal response. Hence this advisory opinion is furnished.

The property involved in your inquiry is the subject of the Department of Administration's State Property Office acquisition File No. 92-JJJ which has been reviewed.

The pertinent facts revealed by our review show that acquisition of the subject property from the Triangle Land Conservancy was initiated by agency request pursuant to G.S. § 146-23 and approval of further investigation and acquisition was given by the Council of State. Thereafter the Department of Administration continued its investigation pursuant to statutory requirements to determine whether the donation and acquisition, as intended, could be consummated. It is not unusual for proposed transfers of land not to be carried through to completion for various reasons.

The donor's obvious intent and desire was for the property to be used as a part of Umstead State Park and for no other purpose. During the continued investigation and prior to execution of the deed, it was learned that the property lay within the proposed right of way for a Department of Transportation highway project. Accordingly, the Department of Administration instructed the Property Control Division of the Attorney General's Office to terminate its activities toward consummation of the acquisition. That office in turn directed the private law firm acting on its behalf to terminate its activities in that regard. At that point, no deed to the property had been delivered to the State or to the private attorneys acting on behalf of the State. The State did not make an unconditional acceptance of its delivery through the U.S. mail because of the potential for the donor's wishes to be unrealized. The matter and the controversy surrounding it has been the subject of pertinent correspondence among the Department of Administration, the donor, and the Department of Environment, Health and Natural Resources, all of which confirm the uncertainty of the donation's status in light of the Department of Transportation highway project.

The first question upon which you request our opinion is:

Question: Has the State acquired the property pursuant to G.S. § 146-26?

Answer: No.

Initially, we should reiterate that delivery has not been accepted by the State. "[T]here is no complete 'delivery' until the deed is 'accepted'." Webster's REAL ESTATE LAW IN NORTH CAROLINA, § 10-58 (4th Ed. 1994). To answer your specific question, however, a review of the State acquisition process is in order.

G.S. §§ 146-22 et seq. provide a procedure whereby the State may acquire property for public parks and other uses. That procedure requires investigation of proposed acquisitions by the Department of Administration and a determination that acquisition is in the best interest of the State. See G.S. § 146-24. While Council of State approval of acquisitions is required as a part of that procedure, the statutes clearly state that every acquisition "shall be made by the Department of Administration." Council of State approval does not require consummation of the acquisition. While the Council of State may "request" acquisitions, such acquisitions may be made only upon compliance with the investigation herein required. G.S. § 146-23.

The Council of State cannot direct the Department of Administration to acquire property [See Martin v. Thornburg, et al, 320 N.C. 533 (1987)] and G.S. § 146-24(b) which provides that "no conveyance of land may be made to a particular state agency or to the State for the use and benefit of a particular state agency."

The obvious purpose of these statutes is to leave the State free to use land it acquires for whatever purpose is found to be in the State's best interest.

G.S. § 146-26 provides:

No devise or donation of land or any interest therein to the State or to any State agency shall be effective to vest title to the said land or any interest therein in the State or in any State agency until the devise or donation is accepted by the Governor and Council of State. Upon acceptance by the Governor and Council of State, title to the said land or interest therein shall immediately vest as of the time title would have vested but for the above requirement of acceptance by the Governor and Council of State.

This statute was obviously designed to protect the State from situations where a deed or will provision purported to vest title in the State prior to the required Department of Administration investigation and determination. It has no application to situations like the present one which are initiated by agency request. Rather, it is a protective statute, and does not supersede the other pertinent provisions in Chapter 146 regarding the acquisition process.

Your remaining questions presuppose an affirmative answer to your first question and concern possible future use of the property as a part of Umstead State Park. No property acquired by the State is subject to use or control by any particular State agency until allocated to that agency by the Department of Administration pursuant to G.S. § 143-341(4)g. As the State does not presently own the property, no allocation has occurred. Therefore, discussion of your remaining questions is unnecessary.

However, it is worth noting that the allocation process and the Department of Transportation's interest in the same tract of land means that the donor's desire that the land be a part of Umstead State Park may not be realized. It is our understanding that the State agencies, upon recognition of this fact, wanted to ascertain the effect this would have on the intended donation before proceeding. The matter currently remains in that position.

John R. McArthur
Chief Counsel

T. Buie Costen
Special Deputy Attorney General