Municipal – City has sovereign immunity against commercial owner’s claims

Where the owner of commercial property sued the City of Hopewell, after it burned his allegedly “blighted” property, the City was entitled to sovereign immunity, because it was engaged in a governmental function.

Background

Shree Arihant Motel, Inc. owns real property in the City of Hopewell, Virginia. Colonial Corner, a shopping center built in the 1970s, was located on the property. On Feb. 26, 2021, the City’s fire department burned the vacant Colonial Corner as part of a scheduled burn.

Shree Arihant’s second amended complaint asserted numerous claims against the City and the contractors who removed asbestos and debris from the Colonial Corner property. The City filed a plea in bar based on sovereign immunity, arguing that it was engaged in a governmental function when it burned Colonial Corner.

The circuit court denied the City’s plea in bar. When ruling from the bench at the conclusion of the pertinent hearing, the circuit court explained that it could not determine whether the City’s actions “were solely or partially within its governmental function.”

Scope

The City’s plea in bar will not fully immunize it from compulsory participation in further proceedings. The City acknowledges that it is not immune from Shree Arihant’s takings claim. Nonetheless, this court exercised its discretionary authority to grant the City’s petition for an interlocutory appeal to address the City’s contention that it is entitled to sovereign immunity from the other claims asserted by Shree Arihant.

Analysis

Sovereign immunity protects municipalities from claims arising from the performance of governmental functions. “A function is governmental if it entails the exercise of an entity’s political, discretionary, or legislative authority.” “Governmental functions are powers and duties performed exclusively for the public welfare.” A governmental function is “directly tied to the health, safety, and welfare of [a municipality’s] citizens.”

In contrast, sovereign immunity does not protect municipalities from claims arising from the performance of proprietary functions. “If [a] function is a ministerial act and involves no discretion, it is proprietary.” “Proprietary functions are performed primarily for the benefit of the municipality.” Sovereign immunity does not apply to claims arising from these functions, “even though ‘the general public may derive a common benefit’ from their performance.”

In the present case, the City did not comply with the statutory and municipal provisions governing spot blight abatement. The City Council was required to adopt a specific ordinance declaring Colonial Corner to be a blighted property. The City Council, however, never adopted such an ordinance. Moreover, the City Council never formally voted to demolish Colonial Corner. After the City Council voted to move forward with planning the controlled burn, its clerk erroneously recorded that the City Council had voted to burn the shopping center.

The City’s immunity from the claims at issue, however, is not contingent upon the City’s compliance with statutory and municipal provisions. This court has consistently held that municipal sovereign immunity is contingent upon the nature of the actions underlying the claims at issue. If a claim arises from the performance of a governmental function, a municipality is generally entitled to sovereign immunity from that claim—even when the municipality exercises its authority in a “‘negligent or improper manner.’”

The allegations of the second amended complaint and the attached exhibits establish that the City was—at least partially—engaged in a governmental function when it burned Colonial Corner. In the notices that the City sent to Shree Arihant, it expressly noted that Colonial Corner was a “blighted” property. The City also explained that Colonial Corner was “dilapidated,” “deteriorated,” “unsafe,” “unfit for human occupancy” and a danger to the “public’s health, safety, [and] welfare.”

Blight abatement is a governmental function. It involves the exercise of a municipality’s discretionary authority and promotes the health, safety and general welfare of a municipality’s citizens. When the City exercised its discretionary authority to demolish a blighted shopping center that posed a threat to public safety, it engaged in a governmental function that triggered the protection of municipal sovereign immunity.

While the City may have considered the redevelopment of the Colonial Corner property when it decided to burn the shopping center, it also burned the shopping center to eliminate blight. Therefore, the claims at issue in this case arise—at least in part—from the performance of a governmental function.

Reversed and remanded.

City of Hopewell, Virginia v. Shree Arihant Motel, Inc., Record No. 251193, July 16, 2026 (Chafin). From the Circuit Court of the City of Hopewell. VLW 026-6-031. 10 pp.

Full-Text Opinion