Word reaches us informally that the case in Boulder County, Colorado, involving the taking of the old Dillard’s department store in Longmont for redevelopment has been resolved. We lack any details — which we will supply when we get them. But the essentials are that the redevelopment agency offered some $3 million, but after a trial on the right to take (which went in favor of the redevelopment agency) the case settled for over $6 million.
Earlier, a local court ruled in favor of the redevelopment agency on the right to take, with the valuation trial to take place later. But it looks like there won’t be any valuation trial because the parties have agreed on compensation at a figure about twice what the redevelopment agency had originally offered.
The case is Boulder County District Court, Longmont Urban Renewal Agency v. DSS Uniter, LLC, Case No. 13 CV30828.
Stay tuned for the rest of the story.
This is quite a story, and it comes to us from Gulfport, Mississippi. Mary Perez, Jury Awards Dedeaux Utility $8.1 Million Plus Interest, The Sun Herald, Dec., 23, 2013. This was the third trial, which gives you a hint of what is going on here. In 2004, the city took Dedeaux Utility Co., a local utility, and the jury awarded $3.6 million. The city appealed, and the Mississippi Supreme Court reversed and remanded for another trial, in which the [second] jury awarded $5.1 million. The city didn’t take the hint and appealed again, getting another reversal from the appellate court, and yet another (third) trial, in which the jury awarded $8,063,981, plus interest.
The Sun Herald story fails to disclose what the city’s offer or evidence was, but it does tell us that the city now owes the Dedeaux Utility Company another $3.6, plus about $3 million in interest. Do you think the city will appeal again?
What is interesting to us is how much money the city and the Mississippi courts have spent to far on this caper, which might give us a clue as to how big this lowball was and whether this game is worth the candle. Maybe we will find out. Stay tuned just in case.
This one’s a doozy. The Associated press (Dec. 3, 2013) reports that the school board of Jenks, Oklahoma, offered $395,000 for 12.7 acres of the Taylor’s land, but the commissioners awarded $1.4 million. When the matter was then tried to a jury, it awarded $3.1 million. However, at this point, the trial judge decided that she shouldn’t have permitted jury consideration of the value of billboards on the subject property, so she granted a new trial. The owner appealed, and the Oklahoma Court of Civil Appeals reversed the new trial order and reinstated the jury verdict.
So the bottom line of this one is that on the board’s original offer of $395,000, the owners were eventually awarded $3.1 million. They were also awarded interest on the difference between the commissioners’ award (which the board paid) and the ultimate award.
We are reliably informed of the following settlement of an eminent domain case in Mecklenburg County in North Carolina. N.C. DOT v. Independence Tower Building.
DOT initially offered $256,000 (based on a $231,700 appraisal) for the taking of 0.4 acres out of a 5-acre parcel improved with a 12-story commercial office building, which reduced parking by 62 spaces, affected the subject property’s highest and best use, and changed access to it.
When the owners rejected its offer, DOT conducted another appraisal and upped the offer for the taking to $534,200. At this point the owners retained counsel (who pointed out that the rents used by DOT were project influenced). That revelation caused DOT to conduct a third appraisal which came to $4,889,425. After further negotiations, final settlement came to $5,228,014.19. In other words, the settlement came to 93 times DOT’s original offer.
The moral of this story is that even if you have reason to think that you are a sophisticated owner of a valuable property, it’s a good idea to retain and consult both lawyers and appraisers who really know what they are doing.
Seacoastonline. com brings the dispatch that the New Hampshire Supreme Court has affirmed without oral arguments a Rockingham County jury award of $130,000 to the owners of a bicycle shop named “Papa Wheelies,” as against the condemnor/city’s contention that it should have been $18,500. Why the big spread? As far as we can figure out from the newspaper report, the lower figure was in line with evidence of value the State Board of Tax Appeals used to value the subject property for tax purposes. See Elizabeth Dinah, Supreme Court Upholds $130 K Award for Papa Wheelies, Seacoastonline.com, October 9, 2013 — click here.
This is a problem on which the courts are split. Some allow evidence of tax valuation when the tax valuation figure was contended for by the owner, and its admission into evidence can be justified as an admission against interest. Others disagree because the purpose of valuation in these two types of cases is very different. It is proper (and indeed required in some states) that the fair market value awarded in eminent domain must be the highest price the owner could obtain in the market in a voluntary, arm’s length transaction. On the other hand, in valuation for tax purposes, the owner is free to contend for the lowest justifiable value — there is nothing wrong with that. After all, remember that value is a matter of opinion, not fact. Also, in tax valuation, if the valuers get it wrong, the property can be reassessed, whereas in eminent domain the judgment is final and there is no going back to redo it (unless there has been a prejudicial error of law) which is another story.
The taking in the Papa Wheelies case was of two temporary easements for new water and sewer lines, plus a permanent easement for two sewer lines.
Wow! Them Texicans sure know how to do things big! Here is a dispatch from Harris County. State v. Macy’s Retail Holdings, Inc., Case No. 997,839 (County Civil Court).
The case involved two properties: Macy’s (20.02 acres) and a local developer’s named NW-JCP, LP (45 acres).
Texas DOT took 11.82 acres from Macy’s (which took a substantial part of its parking), and offered $8,240,,2240. It took 1.395 acres from the developer’s 45-acre tract, for which it offered $972,208.
We don’t know yet what legal issues divided the parties, but judgment was entered as follows: $31,000,000 for Macy’s, and $32,000,000 for the developer, for a total of $63,000,000.
The Los Angeles Daily Journal reports that a case just settled in Orange County, California. (Katie Lucia, Eminent Domain Settlement May be State’s Largest This Year, Sep. 10, 2013) The city filed an eminent domain action and took a 13-acre parcel for an 86-acre park. The problem was that the appraisers for the city of Lake Forest did not assign any value for severance damages to the mineral deposits (sand and gravel) under the subject land, so the city deposited $7.4 million, and just before trial lowered its offer to 6.6 million.
The problem, according to the city, was the cost of developing the land after removal of the minerals. The city at first contended that the cost of mineral removal and of redeveloping the land after that would exceed their value. But shortly before the case was to go trial, the city was born again, and settled the case for $15.4 million.
The Press Democrat of August 5, 2013, (click on http://www.pressdemocrat.com/article/20130805/articles/130809741?title=Landowners-and-Sonoma-county-settle-airport-expansion-lawsuit#page=1 ) reports that Sonoma County has settled its eminent domain action for local airport expansion for $815,000, as opposed to the county’s initial offer of $135,000. What gave this controversy a touch of government chutzpa was that the county valued this 6.5-acre parcel for tax purposes at $408,000, and $475,000 before the bubble popped.
Bottom line: the settlement was 10 times the county’s initial offer.
News reaches us from the Charlotte area of North Carolina that an eminent domain case pending in Mecklenburg County, and involving a partial taking of some 25% of the improvements of a shopping center, just settled (two weeks before trial) for $22,500,000. Dept. of Transportation v. Independence Shopping Center. The condemnor’s offer was $16,864,000, so the settlement amount represents an increase of $5,636,000, or one-third over the condemnor’s offer.
We are told that this settlement is the largest one in the history of North Carolina.
We just got only the essential news, so we are in no position to provide any details as to what issues divided the parties, but we hope to provide those as we get them.
What is remarkable about this case (and others like it that settle for large sums over the condemnor’s offer) is that the condemnor settled instead of fighting to the bitter end, which is a sort of an admission on its part that it was trying to lowball the property owner.
It isn’t every day that an appellate court calls a condemnor’s argument in a multi-million dollar case “absurd,” but the Louisiana Court of Appeals did so in Louisiana State University and Agricultural & Mechanical College v. 1732 Canal Street, Case No. 2012-CA-1370, opinion filed on June 19, 2013.
The Louisiana Court of Appeals just handed down an opinion affirming a trial court’s judgment on a jury award of $9,566,640. The condemnor’s deposit and opinion evidence was $4,500,000. The appellate court characterized the condemnor’s argument as “absurd,” holding that it presented no legal argument that would support the court’s disregard of the jury’s verdict. Condemnor evidently argued that the verdict should not stand because it was too far apart from the parties’ respective contentions, and therefore condemnor could not calculate how the jury arrived at its conclusion. The condemnor argued for an award of $4,500,000, and the condemnee for roughly $21.5 million.
The court held that as long as the verdict was within the range of the parties’ opinions, condemor’s argument was not a proper basis for vacating the jury verdict. Condemnor relied on case law in which the verdict was outside the range of value opinions, and therefore, on the facts in this case, it provided no legal basis for condemnor’s legal argument.