Title: Pinewood Manor, Inc. v. Agency of Transportation

State: vermont

Issuer: Vermont Supreme Court

Document:

PINEWOOD_MANOR_V_AGENCY_TRANSP.94-108; 164 Vt 312; 668 A.2d 653

[Opinion Filed 08-Sep-1995]

[Motion for Reargument Denied 30-Oct-1995]

       NOTICE:  This opinion is subject to motions for reargument under
  V.R.A.P. 40 as well as formal revision before publication in the Vermont
  Reports.  Readers are requested to notify the Reporter of Decisions,
  Vermont Supreme Court, 109 State Street, Montpelier, Vermont 05609-0801 of
  any errors in order that corrections may be made before this opinion goes
  to press.


                                 No. 94-108


Pinewood Manor, Inc.                              Supreme Court

                                                  On Appeal from
    v.                                            Chittenden Superior Court

Vermont Agency of Transportation                  May Term, 1995


Matthew I. Katz, J.

       Paul D. Jarvis and Richard R. Goldsborough of Jarvis and Kaplan,
  Burlington, for plaintiff-appellant

       Jeffrey L. Amestoy, Attorney General, and Scott A. Whitted, Assistant
  Attorney General, Montpelier, for defendant-appellee


PRESENT:  Allen, C.J., Gibson, Dooley, Morse and Johnson, JJ.


       JOHNSON, J.   Plaintiff Pinewood Manor, Inc. [Pinewood], appeals a
  decision from the Chittenden Superior Court in a condemnation proceeding. 
  Pinewood contends that the trial court erred in its findings regarding: (1)
  the value of the condemned land, (2) appropriate business losses, (3)
  adequate severance damages, and (4) the interest on the judgment.  The
  State cross-appeals the trial court's decision to award business losses. 
  We reverse on the issue of business loss and revise the interest award to
  include that accrued from December 10, 1993 to February 15, 1994.  In all
  other respects, we affirm.

       Pinewood has developed the residential area known as Pinewood Manor,
  situated on the northerly side of Vermont Route 117, into residential
  subdivision lots since the early 1960s.  In addition to subdividing the
  land and providing the infrastructure, it normally constructs the houses on
  the individual lots sold.

       Effective February 16, 1990, the Chittenden County Circumferential
  Highway District condemned land owned by Pinewood within its development. 
  The condemnation covers 8.93

 

  acres, including ten lots in Section F of Pinewood's overall
  development.  At the time of the taking, Pinewood had already obtained the
  required subdivision permits and plotted out the lots. Though Pinewood had
  not yet completely finished the infrastructure, it had begun to install
  some of the required roads and utilities.

       The trial court found that the lots should be valued at $30,000 each
  for a total of $300,000.  It rejected Pinewood's contention that the lots
  were worth $65,000 because they were not ready to be sold on the open
  market on the date of the taking.  The court noted that Pinewood had not
  cleared the lots of trees, paved the roads, or brought sewer, water and
  electricity to each site.

       In addition, the court held the State liable to Pinewood for business
  losses and severance damages in the amount of $150,000 and $26,500
  respectively.  The court reasoned that business losses were due to Pinewood
  because its practice was to develop the land and then sell it with a
  contract for the construction of a house.  Therefore, the court considered
  Pinewood a fixed and established business that extended beyond mere land
  development.  To find business loss, the court used historical profits from
  the Pinewood Manor development to calculate an average expected profit of
  $15,000 per house.  The court multiplied this average profit by the ten
  lots taken to reach an ultimate award of $150,000.  No contracts for
  construction of the houses on the ten condemned lots had actually been
  entered into.

       To limit the number of condemned lots to ten, the trial court
  acknowledged that Pinewood would have to create three new lots from
  portions of the remainder.  The reconfigured lots' proximity to the
  highway, however, reduced their value by ten percent.  Therefore, the court
  ordered the State to compensate Pinewood $17,500 for the reasonable cost of
  repermitting and $9000 for the reduced value of the lots.

       Pinewood's appeal focuses on several of the trial court's rulings on
  damages.

 


                                     I.

       In a property condemnation proceeding, a land owner can recover for
  (1) the value of the most reasonable use of the property or right in the
  property, (2) the value of the business on the property, and (3) the direct
  and proximate decrease in the value of the remaining property or right in
  the property and the business on the property.  19 V.S.A. Sec. 501(2).  The
  value of the most reasonable use of the property is the market value of the
  land's highest and best use as of the date of the condemnation.  Raymond v.
  Chittenden County Highway, 158 Vt. 100, 103-4, 604 A.2d 1281, 1284 (1992). 
  This requirement presents the trial court with a factual issue that is "at
  best a matter of opinion."  Green Mountain Marble Co. v. State Highway Bd.,
  130 Vt. 455, 464,