E-Alert Case Updates

D.C. Court of Appeals Affirms Condemnation Award

Greene v. District of Columbia
No. 11-CV-1626 (District of Columbia Court of Appeals, December 6, 2012)
by Colleen K. O’Brien, Associate
Semmes, Bowen & Semmes (www.semmes.com)

In this condemnation case, the Court addressed the District of Columbia’s revitalization project for the Skyland Shopping Center. Appellant, Mary Rose Greene (hereafter “Greene”), owned property near the shopping center. After a portion of her property was condemned, a jury trial was held to determine her compensation for the taking, where she was awarded nearly two (2) million dollars. Greene appealed from the award, claiming that the compensation was inadequate, because, inter alia, the trial court did not permit her to present evidence of severance damages (i.e., evidence that the taking reduced the value of her untaken land) and 2) the trial court improperly restricted her expert appraiser’s testimony. The District of Columbia Court of Appeals found no merit to these arguments and affirmed the jury award.

In terms of the underlying facts, Green owned approximately eight (8) and a half acres of land, near the Skyland Shopping Center. Green’s land was largely wooded, undeveloped, and unused. In 2004, the District offered Greene $934,000 to purchase seven (7) of her acres, but Greene declined to sell. Instead, Greene hired an architect who created a plan for a mixed residential development project to demonstrate the market value of her land. The development project created by Greene’s architect was admittedly drafted solely for use in the takings litigation.

During the condemnation litigation, both Greene and the District engaged appraiser experts to opine as to the fair market value of the property. Both experts agreed that the best method of valuation under the circumstances was to look at sales of comparable properties in the area, contemporaneous to the taking. Greene’s expert opined that the value of the taken land was $9,561,000, while the District’s expert opined that the value of the taken land was $1,850,000. The jury adopted the value offered by the District’s expert.

As to the first issue on appeal, Greene contended that the trial court improperly precluded her from presenting evidence of severance damages. The key to severance damages is “unity of use” which refers to whether the part taken is itself a separate economic unit, or whether it is only part of a larger parcel. The appellate court held that the issue of severance damages should ordinarily go to a jury and that a trial court may intervene only when reasonable minds could not differ regarding unity of use. Further, if a reasonably foreseeable integrated use has a present effect on market value, then it should be compensable as a component of just compensation. In this case, however, where Greene’s only proffer as to unity of use was that she intended to develop the assemblage of land herself, or sell it to a developer as a unit, the unity of use evidence was wholly insufficient, and so the trial court properly precluded her from presenting evidence of severance damages to the jury.

As to the second issue on appeal, Greene argued that she was compensated inadequately for her taken land because of “overly restrictive” rulings by the trial court that limited her expert’s testimony regarding his valuation of the taken property. Specifically, Greene asserted that the trial court abused its discretion when it barred her expert from discussing one (1) comparable sale not included in his initial report. The appellate court affirmed the trial court’s ruling because Greene’s expert admitted that he was aware of the comparable sale when he drafted his initial report, but did not include it because he failed to verify it, and moreover, because the comparable did not alter the expert’s ultimate conclusion. Greene also argued that the trial court erred by barring her expert from testifying about alternative methods of calculating the value of the taken land, such as 1) the land residual approach; 2) shell sales; or 3) macro sales. Where Greene’s expert admitted that these valuation analyses were just “additional background” to his comparable sales analysis, and did not alter his opinion of the value of Greene’s property, the trial court’s exclusion of these techniques was not an abuse of discretion.

Overall, the appellate court held that Greene was given a full and fair opportunity to present evidence to the jury regarding the value of her taken property, and the jury’s rejection of her “almost ten million dollar price tag for her land” was not attributable to any procedural deficiency at trial. Consequently, the judgment of the trial court was affirmed.