Opinion
No. 74-045
Decided December 31, 1974. rehearing denied January 21, 1975.
Following condemnation award of $49,000 for damages to the remainder of property taken, trial court granted new trial with result that damage to remainder was found to be $8,085. Property owners appealed.
Reversed
1. EMINENT DOMAIN — Residue — Land Taken — Presently Subdivided — Comparable Sales Evidence — Admissible. In determination of condemnation award for residue of land taken, the residue was not land for sale for future subdividing, but rather was land already subdivided and presented for sale for residential purposes; therefore, evidence of the sales price paid for similar property was admissible on the question of value of the property condemned, provided the properties sold are similar in locality and character to the property in question and not so far removed in point of time as to make a comparison unjust or impossible; and hence, since testimony offered at first hearing of condemnation proceedings met the test of comparability as to locality, character and proximity in time, such evidence was competent and admissible.
2. NEW TRIAL — Second Condemnation Proceedings — Landowner's Participation — Not — Waiver — Objection — Motion — Erroneously Granted. Landowner's participation in second hearing of condemnation proceedings does not waive their objection to the order granting the new trial motion after the first hearing; hence, the Court of Appeals may consider the propriety of that order and since comparable sales testimony was properly admitted at the first hearing, a new trial should not have been granted.
Appeal from the District Court of the County of Jefferson, Honorable Daniel J. Shannon, Judge.
John P. Moore, Attorney General, Joseph M. Montano, Special Assistant Attorney General, Loyal W. Trumbull, Special Assistant Attorney General, for petitioners-appellees.
Ireland, Stapleton, Pryor Holmes, P.C., Kenneth L. Starr, James C. Ruh, for respondents-appellants.
Evergreen, Inc., Bernard Woody, Jefferson Land Associates, and Van Schaack and Company (collectively Owners) owned property part of which was taken on condemnation by the State Department of Highways. After a hearing before a commission, the court entered judgment for the Owners in accordance with the commissioners' award of $16,000 for the taking and $49,000 for damage to the remainder after the taking. The department moved for a new trial on the matter of damage to the remainder. The court granted the motion on the basis that appraisal testimony of the Owners' expert witness was improperly admitted. After the second hearing, the commission awarded $8,085 as the damage to the remainder, and the court entered a new judgment in that amount. Owners appeal from the order granting a new trial and from the new judgment. The new trial was improperly granted and therefore we reverse.
Owners own the Hiwan subdivision which abuts the east side of Colorado Highway 74 between Evergreen and Bergen Park. In conjunction with the improvement of Highway 74, the Highway Department condemned and took a strip of land along the western edge of the subdivision. The amount awarded for the strip taken is not contested by either side; the dispute in this action relates to the amount to be paid for damage to the remainder, which consists of 13 unsold platted lots abutting the west side of the strip taken.
At the first hearing, Owners' appraisal witness, Parker, testified, over objection, that, before the taking, the remainder had a value of at least $117,000, $9,000 per lot for 13 lots. He testified further that after the taking, considering the necessity of using a portion of the remainder to relocate therein the utility easement previously contained in the strip taken, the setbacks required by the subdivision covenants and the county zoning ordinance, the nature of housing in the area, and the terrain of the lots, the lots were reduced to 50 percent of their previous value, or $58,000. On this evidence, the commissioners awarded $49,000 to the Owners as damage to the residue.
In considering the motion for new trial, the court found that appraiser Parker's valuation, "based upon the minimum valuation of each lot of $9,000 x 13, the number of lots," was arrived at by "comparing sales of partially developed lots in another part of the subdivision with unsold but similarly partially developed lots in the residue, plus diminishing the value of the residue by the development costs or in the alternative by anticipated loss of value due to an anticipated relocation of water and sewer lines." Basing its conclusion on Department of Highways v. Schulhoff, 167 Colo. 72, 445 P.2d 402; Board of County Commissioners v. Vail Associates, Ltd., 171 Colo. 381, 468 P.2d 842, and State of Utah v. Tedesco, 4 Utah 2d 248, 291 P.2d 1028, the court concluded that this method of valuation was improper.
The court accurately summarized the nature of Parker's testimony and the basis for his valuation. However, we do not agree with the court's conclusion.
The cases relied on by the trial court all deal with undeveloped land for which the highest and best use is subdivision into residential building sites. In those cases, it was held error to attempt to arrive at value by hypothetically subdividing the property into lots and then projecting a value at which each of the lots would sell by evidence of sales of sites in developed areas.
That is not the situation here. We are dealing not with raw land, but with platted and developed land, and these cases do not apply. The 13 lots are a part of the Hiwan subdivision, which was platted in 1963, seven years before the date of taking, with provisions for more than 300 sites, roads, recreation areas, and utility easements. Of the lots platted, 180 to 190 had already been sold by the time of the taking. Roadways into the subdivision had been constructed; some of them had been paved. Detailed arrangements had been made for the installation of utilities, and utilities had been installed into some areas of the subdivision. Electricity had been run between pairs of adjoining lots in the residue to provide service to them. Roads had been cut to some of these lots and had been at least staked to all of the lots. The residue was not land for sale for future subdividing; it was land already subdivided and presently for sale for residential purposes.
[1] In this situation, the general rule on comparable sale evidence applies.
"Evidence of the price paid for similar property in a voluntary sale is admissible on the question of value of the property condemned, provided the properties sold are similar in locality and character to the property in question and not so far removed in point of time to make a comparison unjust or impossible." Department of Highways v. Schulhoff, supra. To the same effect, see Board of County Commissioners v. Vail Associates, Ltd., supra. The sales referred to by Parker in his testimony were of sites in a similar state of development, of similar size and terrain, for single family residential use, consummated within the preceding 18 months in the same subdivision. The testimony met the tests of comparability as to locality, character and proximity in time. This evidence was competent and admissible.
We agree with the reasoning stated in Babinec v. State of Alaska, 512 P.2d 563 (Alas. 1973), quoting from In Re Appropriation for Highway Purposes of Land of Lunsford, 15 Ohio App. 2d 131, 239 N.E.2d 110 (1968):
"In this case the land was not merely suitable for subdivision purposes. The process of subdivision, platting, recording and development had progressed to the point where the individual lots were available as separate units for sale. One lot had been sold. Two others had had homes built or partially built upon them for sale. There were available, as testified to by the appraisers, lots, the sales of which were comparable to these in that there were no sewers and no centralized water system. In short, a valuation of each lot was practical and available.
"To insist that the land must be appraised as a whole without reference to individual lot values would, in effect, deprive the owner of a valuation of the highest and best use of the land as individual residence lots and force him to value the land merely as land available for subdivision purposes. Land which is thus divided and presently suitable for sale as individual lots to many buyers would have a higher market value than land which is merely currently suitable for sale as one tract to a single person who would in turn subdivide or develop the land for sale to others. Such a single buyer would have to consider factors of risk which individual lot buyers would not have to recognize.
"Therefore, although the question for the jury is the fair market value of the tract as a whole, evidence as to the individual lot values would be both pertinent and necessary to a consideration of the highest and best use of the land."
Accord, State Department of Highways v. Cobb, 169 So.2d 419 (La.App. 1964). See also Commonwealth Department of Highways v. Caudill, 388 S.W.2d 376 (Ky., 1965).
[2] Owners' participation in the second hearing does not waive their objection to the order granting the new trial motion after the first hearing. C.R.C.P. 59(g). This court may, therefore, consider the propriety of that order. We hold that Parker's comparable sales testimony was properly admitted at the first hearing, and the new trial should not have been granted.
In view of this decision, we need not consider any other alleged errors asserted by Owners.
The judgment entered after the second hearing is reversed and the cause is remanded to the trial court with directions to reinstate the judgment on the original certificate of ascertainment and assessment, with interest from the original date of that judgment, plus costs of both hearings.
JUDGE ENOCH and JUDGE BERMAN concur.