Category: Lowball Watch

Justice in the Didden Case

You remember the Didden case? Of course you do. That was the wretched Port Chester, New York, controversy in which Didden was about to build a major drugstore when he was approached by a redeveloper who demanded either $800,000 or 50% of the action, or else the subject property would be taken by the local redevelopment agency. Didden refused, and the property was taken over his protests that this was extortionate.

Now, we get a dispatch from the New York Appellate Division, in the form of an opinion, In the Matter of Village of Port Chester, 2012 N.Y. App. Div. LEXIS 3420. The trial court had awarded $3,062,000, and the Village appealed, claiming error by way of the trial court’s finding that the subject property should be valued as one larger parcel. Though there were several partial owners, they were unified in the purpose and efforts to obtain proper entitlements for a new drugstore, and that made the subject property one parcel for valuation purposes. There was unity of use, and the owners of various interests had agreed to share equally in expenses, which satisfied the unity of title requirement.

Finally, justice was done — the bad guys got it in the chops. The Village’s appraiser had destroyed earlier versions of his appraisal reports, whereas USPAP requires that they be retained for use in cross-examination. For this the trial court imposed sanctions in the form of “accord[ing] an adverse inference with regard to the destruction of prior draft appraisals. . .” The opinion does not indicate how much difference that made in the monetary outcome, but it must have smarted because the Village appealed on that point but to no avail.

Follow up: Oops! We almost forgot. At trial, the Village contended that just compensation payable for this taking was $975,000, which makes the award over three times the Village contention, and qualifies this post for our  “Lowball Watch” category.

Lowball Watch – Alabama

Dothaneagle.com reports on how the City of Dothan, Alabama, wound up having to pay $830,000 for land that commissioners valued at $117,000. Lance Griffin, Dothan Could Be on Hook for Costly Right of Way Judgment, Dothan Eagle, May 3, 2012. Click here.

The city took a 0.333-acre strip of land, plus a drainage easement of 0.016 acres, and two construction easements totalling  0.25 acres. A three-person panel of commissioners appointed by the Houston County Probate Court valued the take at $117,440. That was on January 28, 2005.

The owner appealed to the Circuit Court where “the matter languished” until this year. Eventually, at trial, the testimony of the city’s apprasiser was stricken on the owner’s motion, and the Circuit Court awarded $507,530. While all this went on, interest was running, and the court calculated it at $327,675.60 for a grand total of $717,716.60 (after giving the city credit for its $117,440 deposit).

The city has appealed to the Alabama Supreme Court. Stay tuned.

Lowball Watch – Kansas

We are reliably informed that in the case of Hobbs v. Miller, Circuit Court of  Finney County, Kansas, No. 09 CV 150, the DOT just abandoned a condemnation case under the following circumstances. The taking would shut off driveway access to the subject property (which DOT argued was noncompensable because it was only a case of circuity of travel). It offered $5000. The trial court found this to be a taking of access, and the appraisers (which we assume in Kansas means “commissioners”) awarded $231,000. DOT then abandoned the taking, and the court awarded $121,000 in attorneys fees.

Lowball Watch – New Jersey

Northjersey.com reports (Evonne Coutros, Saddle River Asks State Supreme Court to Review Eminent Domain Ruling, April 24, 2012 — click here) that the Borough of Saddle River just took it on the chin. It took a 2-acre vacant former service station site, and valued it at $1.35 million. But the owners, contending that there was a probability of zone change, opined to a market value of $5.25 million — which is what the trial court awarded, and the Appellate Division affirmed.

The borough has petitioned the New Jersey Supreme Court for review. Stay tuned.

Lowball Watch – New Jersey

Business Week reports that the New Jersey Appellate Division has affirmed the trial court’s judgment in an interesting case. The town of Harvey Cedars decided to restore the beach and in so doing built a 22-foot dune between the sea and the beachfront home of the Karans, concededly worth $1.9 million. It offered them $300 for the diminution in value caused by the loss of view.

After trial the court awarded $375,000. Now, that award has been affirmed on appeal.

For a Business Week story reporting these events, click here.

Lowball Watch – Florida

The News Press reports the results of an eminent domain taking of 3.39 acres out of a 26-acre tract by Lee County (Mark S. Krzos, Estero Land Seizure Will Cost Lee $1.92 Million, Jury Rules, news-press.com, March 26, 2012 – click here) as follows: offer – $883,000; verdict – $1,920,000. Or, according to our calaculator the award was over twice the amount of the offer.

The bone of contention was the county’s position that it should pay only for the taken land, and pay nothing for severance damages which came to $860,000 according to the owner. The jury agreed.

Lowball Watch – Louisiana

We are informed that the Louisiana District Court has just entered judgment in a case of taking of 10.12 acres (Orleans Levee District v. New Orleans Michoud Industrial Park, No. 2008-13114, judgment entered March 13, 20012). The numbers are as follows: condemnor’s deposit – $175,000; award for the part taken – $414,979; severance damages – $723,137, for a total compensation of $1,138,114. Plus interest which is yet to be calculated, and attorneys fees which are yet to be awarded. So far, that comes to 6.5 times the condemnor’s deposit. Stay tuned for the balance.

Lowball Watch – Kansas

A recent opinion of the Kansas Supreme Court, Miller v. FW Commercial Properies, No. 105,006 (dealing mostly with who is a party in interest in an eminent domain action, and his entitlement to attorneys fees) also reports that the condemnor’s offer was $7,000, the award of “appraisers” was $18,000, and the eventual settlement was $25,000, or over three times the original offer.

For a discussion of the attorneys’ fees controversy and a link to the opinion, check out the blog of our colleague Robert Thomas at www.inversecondemnation.com March 12, 2012.

Lowball Watch – California

The Los Angeles Times reports a settlement of the controversy between the San Gabriel Valley light-rail project and a property owner whose 4.8-acre tract of land is being acquired for it. Dan Weikel, Gold Line and Landowner Reach Accord, L.A. Times, Feb. 15, 2010, at p. AA4. For the entire L.A. Times article click here.

According to this story, the  light-rail officials originally offered the owner $5.8 million, which he rejected. There was also collateral litigation in which the owner charged members of the authority with conflict of interest and violation of environmental laws.

Bottom line: the litigation settled for $24 million which comes to over four times the original offer, and is exactly what the owner demanded to begin with. The light rail authority folks aver that, notwithstanding these figures, litigationg this controversy to its bitter end would have resulted in a two-year delay and cost an additional $100 million.

We can dig the delay, but doesn’t California law provide for quick-take, whereby the condemnor can take the subject land as soon as the condemnation litigation starts, with compensation determined later? It does.

Lowball Watch – Missouri

The Columbia Daily Tribune reports that the City of Hallville set out to acquire a 148-acre farm property by eminent domain to “resolve sewer system violation.” Accordingly, it offered the owners $550,000, whereas the owners demanded $1.9 million. As is the custom in some states, before going to a valuation jury trial, the matter is decided by a board of commissioners (usually three well informed laymen). In this case, the board of commissioners awarded $1.25 million, or over twice the city’s offer. This is probably not the end of the story because in states using the commissioner system, a party dissatisfied with the commissioners’ award can usually demand and get a jury trial in court, and here it remains to be seen whether the city will avail itself of this option.

The wrinkle in this case is that according to this report, the owners have repeatedly presented an alternative solution for the city to increase the the size of its wastewater cell at a cost of about $400,000. The city refused the offer.

For the Columbia Daily Tribune story (Jodie Jackson, Jr., Panel Values Hallsville Farm at $1.25 Million, Feb. 6, 2012) click here.