Case Title: City of Sioux Falls v. Naused

Citation: 218 N.W.2d 536

Docket Number: 

State: south-dakota

Court: South Dakota Supreme Court

Date: 1974-06-03T00:00:00Z

Document:
218 N.W.2d 536 (1974) CITY OF SIOUX FALLS, a municipal corporation under the Laws of the State of South Dakota, Plaintiff, v. Walter H. NAUSED and Marianne D. Naused, Defendants and Respondents, Sturdevant's L & L Motor Supply, Inc., Defendant, and Sioux Brake and Equipment Company, Inc., Defendant and Appellant. No. 11245. Supreme Court of South Dakota. Argued March 5, 1974. Decided June 3, 1974. *537 Willy, Pruitt, Matthews & Jorgensen, Roy E. Willy and Gene E. Pruitt, Sioux Falls, for defendants and respondents. Blaine Simons, Sioux Falls, for defendant and appellant. BIEGELMEIER, Chief Justice. On the original submission of this appeal, majority and dissenting opinions were written which indicate the facts and differing viewpoints. The opinions are reported in S.D., 214 N.W.2d 74, where the majority directed the dismissal of the Sioux Brake appeal. A petition for rehearing was granted. With additional facts hereafter added, an outline of the position and interests of the parties to the properties involved in this condemnation proceeding was set forth in Justice Doyle's opinion as follows: For the reasons set forth in the dissenting opinion written on the original submission of this appeal, the motion to dismiss is denied and the appeal is disposed of on the merits. (Cf. State Highway Commission v. Foye, 1973, S.D., 205 N.W.2d 100.) In its brief defendant Sioux Brake states: In State Highway Commission v. Foye, 1973, S.D., 205 N.W.2d 100, the just compensation for the taking was stipulated, and "the only issue was the apportionment between Foyes, owners of the property, and tenant Mobil Oil Company." The owners appealed from the trial judge's apportionment of the compensation. Different from the appeal at bar, the tenant there had the usual gasoline filling station facilities and equipment. Much of the court's opinion had to do with the improvements made by the tenant as they affected the value of its lease; however, the court in footnote 1 wrote as follows: See also Pierson v. H. R. Leonard Furniture Co., 1934, 268 Mich. 507, 256 N.W. 529, 98 A.L.R. 244, and cases cited; State v. Platte Valley Public Power & Irrigation Dist., 1946, 147 Neb. 289, 23 N.W.2d 300, 166 A.L.R. 1196. There was testimony by the general manager of Sioux Brake as to the availability of other properties, their distances from the subject property and the improvements that would be needed or desired. While he testified that the value of the Sioux Brake lease was $500 a month over its $225 rental, on two other occasions he testified that the fair, reasonable rental of the leased property was $225 per month. This was the rental Sioux Brake was paying. Indeed, the Sioux Brake brief admits "Mr. Eichman testified that $225.00 was a reasonable rent for the present property." Another witness, a realtor, testified rather thoroughly as to the property values, knew of the $2,700 annual rental cost of the property involved here, fixed its value on the basis of a "rounded" annual rental of $3,000, compared the lease with other leases in the area, and testified that the $2,700 rental amount was comparable to that being paid in this general area. Appellant Sioux Brake urges that the trial court erred in making comments as to the fair market value of the rental when the phrase used by one witness was "the fair, reasonable rental." As the action was tried to the court and not to a jury, we fail to see how this affects the court's findings. Incidentally, the court opinions cited use the phrases "rental value and rent reserved"; "fair market value of the leasehold"; "economic rental and contract rent"; "fair rental value", etc. In commenting on the measure of damages, Julius L. Sackman in an article titled "Compensation Upon The Partial Taking Of A Leasehold Interest", 1961, Institute on Eminent Domain, 35 at 49, states: Similarly, the court in State v. Platte Valley Public Power & Irrigation Dist., 147 Neb. 289, 23 N.W.2d 300, 166 A.L.R. 1196, wrote: Accord: City of Chicago v. Shayne, 46 Ill.App.2d 33, 196 N.E.2d 521, and Nichols on Eminent Domain, Rev.3d Ed., § 12.42[3], n. 56. *539 Proof of tenancy in the condemned premises is not necessarily proof of compensable loss. The burden is on the tenant to prove that the fair market value of his lease is greater than the rent reserved. New Jersey Highway Authority v. J. & F. Holding Co., 40 N.J.Super. 309, 123 A.2d 25; City of Ashland v. Kittle, Ky., 347 S.W.2d 522. We conclude that the findings of the trial court find support in the evidence, that they are not clearly erroneous and, therefore, cannot be set aside. State Highway Commission v. Foye, S.D., 205 N.W.2d 100. Affirmed. WINANS and WOLLMAN, JJ., concur. DOYLE and DUNN, JJ., concur in part and dissent in part. DOYLE, Justice (concurring in part and dissenting in part). Since the result reached by the majority is in effect the same on rehearing as that of the original opinion, City of Sioux Falls v. Naused, 1974, S.D., 214 N.W.2d 74, I concur. However, I still adhere to my original opinion in that a decision on the merits of this case ignores SDCL 15-26-3. I am authorized to state that Justice DUNN is in accord with my position.