Title: KNIGHT v BILLINGS

State: montana

Issuer: Montana Supreme Court

Document:

No. 81-36 IN THE SUPREME COURT OF THE STATE OF MONTANA 1981 EARLE AND HAZEL KNIGHT, et al., Plaintiffs and Appellants, THE CITY OF BILLINGS, a municipal corporation, Defendant and Respondent. Appeal from: District Court of the Thirteenth Judicial District, In and for the County of Yellowstone Honorable Robert Wilson, Judge presiding. Counsel of Record: For Appellants: Pedersen, Herndon, Harper, Munro & Hartman, Billings, Montana Rodney Hartman argued, Billings, Montana For Respondent: Peterson Law Offices, Billings, Montana K. D. Peterson argued, Billings, Montana Submitted: November 30, 1981 Decided: February 25, 1982 Mr. Justice John C. Sheehy delivered the Opinion of the Court. This is an appeal from a judgment by the District Court, Thirteenth Judicial District, Yellowstone County, finding no inverse condemnation by the City of Billings of residential properties owned by the plaintiffs. Plaintiffs are individual homeowners who own residences on the west side of 24th Street West between Lewis and Broadwater Avenues in Billings. They purchased their properties in the years between 1954 and 1976. Twenty-fourth Street West is a major arterial street in Billings. It provides substantial "desire-line" access from a large portion of the Billings environs to a substantial mall, high school, church, and commercial area, located south of these residences. A part of the commercial area extends along 24th Street West itself. The residences are all located within the Lillis Sub- division which was created in 1954. Lillis Subdivision was not in the City of Billings at the time of its creation. The land in Lillis Subdivision is subject to private deed restrictions which allow only single family dwellings until the year 2000. The portion of 24th Street West involved in this case was annexed to the City in 1959. Before that, in 1953, Yellowstone County had restricted the speed limit on 24th Street West to 35 miles per hour, and had installed stop signs for traffic entering the street from the east and west at intersections. Until 1972, 24th Street West was a two lane roadway with on-street parking. The first traffic lights on the street were installed at the intersection of Grand Avenue in 1970. The second followed in 1971 and there are at least four traffic lights now in existence at intersections along 24th Street West. I n 1972, 24th Street W e s t was widened t o provide four l a n e s of t r a f f i c and t h e residences here involved l o s t t h e i r o n - s t r e e t parking r i g h t s o r p r i v i l e g e s . Rimrock M a l l , now Montana's l a r g e s t shopping c e n t e r , w a s opened i n 1975 on 24th S t r e e t W e s t , south of p l a i n t i f f s ' p r o p e r t i e s . There are a l s o along t h e street two l a r g e discount s t o r e s , a supermarket, a hardware s t o r e , a mini- m a l l , two c o n v e n i e m s t o r e s , and s e v e r a l o f f i c e buildings. Another supermarket i s p r e s e n t l y under construction on 24th S t r e e t West near p l a i n t i f f s ' p r o p e r t i e s . The a r t e r i a l a l s o provides access t o an i n t e r s t a t e highway from t h e c i t y proper. T r a f f i c development, as shown by t r a f f i c counts on 24th S t r e e t W e s t i n d i c a t e s : i n A p r i l 1966, an average d a i l y vehicular t r a f f i c flow of 6,330 vehicles; i n August 1970, 9,684 v e h i c l e s ; on J u l y 15, 1975, a t r a f f i c count of 17,040; and i n 1979, an average d a i l y t r a f f i c count of 18,018. Pro- j e c t i o n s f o r t h e year 2000 range from 23,350 t o 36,850 average d a i l y vehicles. I n 1976, t h e C i t y of B i l l i n g s held p u b l i c meetings con- cerning a p o s s i b l e condemnation procedure on 24th S t r e e t West, and t h e r e a f t e r , widened t h e a r t e r i a l by condemning r e a l property e x c l u s i v e l y on t h e e a s t side. No real property was taken from t h e w e s t s i d e of 24th S t r e e t W e s t , where t h e p l a i n t i f f s have t h e i r properties. The D i s t r i c t Court found t h a t no changes on 24th S t r e e t W e s t w e r e undertaken by t h e C i t y u n t i l conditions e x i s t e d which i n d i c a t e d t h a t a n adjustment w a s necessary t o handle t h e t r a f f i c already there. P l a i n t i f f s ' proper&s a subject t o a zoning ordinance which was adopted i n 1972. The zoning ordinance followed extensive p u b l i c hearings and an e l e c t i o n . The p r o p e r t i e s on which p l a i n t i f f s have t h e i r residences w e r e zoned R-7200, which zoning c l a s s i f i c a t i o n still a p p l i e s t o p l a i n t i f f s ' properties. An R-7200 c l a s s i f i c a t i o n permits s i n g l e family dwellings, and a l s o duplexes i f t h e l o t s involved encompass more than 9,600 square f e e t . None of t h e l o t s owned by p l a i n t i f f s m e e t t h e area s p e c i f i c a t i o n necessary f o r duplex p r o p e r t i e s . A l l of t h e p l a i n t i f f s ' p r o p e r t i e s here involved a r e s i n g l e family dwellings and have been during a l l of t h e t i m e t h a t t h e p l a i n t i f f s have occupied t h e same, through t h e events t h a t a r e being recounted here. I n 1978, a f t e r t h e condemnation of t h e property from t h e e a s t s i d e of 24th S t r e e t W e s t , t h e street w a s widened by t h e a d d i t i o n of a f i f t h l a n e s i t u a t e d i n t h e middle of t h e o t h e r four lanes, t o provide f o r left-hand t u r n s from 24th S t r e e t W e s t . Also i n 1978, t h e C i t y c r e a t e d a l i g h t i n g maintenance d i s t r i c t t o provide l i g h t i n g f o r t h e a r t e r i a l . The l i g h t s used w e r e of a higher i n t e n s i t y than normally found on a r e s i d e n t i a l s t r e e t . Several of t h e p l a i n t i f f s p r o t e s t e d t h e proposal f o r t h e l i g h t i n g d i s t r i c t , b u t t h e i r p r o t e s t w a s denied as i n s u f f i c i e n t when numbered a g a i n s t a l l of t h e p r o p e r t i e s t h a t w e r e included i n t h e l i g h t i n g maintenance d i s t r i c t . Also i n 1978, t h e p l a i n t i f f s p e t i t i o n e d t h e City Council of B i l l i n g s f o r a zoning change which would permit p l a i n t i f f s ' p r o p e r t i e s t o be r e c l a s s i f i e d r e s i d e n t i a l professional. However, a p r o t e s t from t h e remaining property owners i n L i l l i s Subdivision, located on streets o t h e r than 24th S t r e e t West, t r i g g e r e d t h e a p p l i c a t i o n of s e c t i o n 76-2-305, MCA. Section 76-2-305 provides t h a t a proposed zoning change t h a t i s p r o t e s t e d s h a l l not become e f f e c t i v e except by a favorable vote of three-fourths of all the members of the city council. In this case, the proposed zoning change was defeated because only six of the ten council members, not the required three-fourths, voted in favor of the change. In consequence, plaintiffs' properties remain zoned R-7200 for residential purposes only. After the failure of their petition for a zoning change, the plaintiffs filed this action against the City of Billings charging inverse condemnation of their properties. At trial, plaintiffs' witnesses characterized the changes that had occurred on 24th Street West. Formerly it was relatively quiet, and had but two traffic lanes. The front yards of the residences were suitable for family or social gatherings. Residents or their guests could park their cars on the street. There was no difficulty getting in and out of driveways. Sidewalks were safe from passing traffic. Noise and pollutant levels were low and not distracting or harmful. There was no undue refuse. Family pets were safe. There was no noticeable vibration from passing traffic and the area was quiet at night. After the 1976-78 condemnation project on 24th Street West was completed, conditions changed. There is now no free access into driveways, but instead long waits in the fifth lane for passing traffic. Free access to and from the driveways is nearly impossible. There have been traffic accidents in front of the residential properties, and sometimes upon their properties. Children and pets are not safe in the front yards and pedestrian traffic along the sidewalks a few feet from passing vehicular traffic is dangerous. Average traffic flows at 22 miles per hour past their houses. Rocks and rubbish from passing traffic are thrown upon their lawns and i n t o t h e i r houses. The sidewalks a r e constantly f i l t h y , e s p e c i a l l y i n winter. The noise from t h e passing t r a f f i c i s s o loud t h a t f r o n t doors must be closed f o r conversation t o be heard inside. T r a f f i c noise is loud and aggravating a t night. The houses cannot be v e n t i l a t e d from t h e e a s t s i d e because of d u s t and exhaust fumes. The houses and contents a r e constantly subject t o vibrations. One of t h e r e s i d e n t s t e s t i f i e d t h a t she had t o tape her windows t o avoid t h e b r i g h t l i g h t from t h e high i n t e n s i t y sodium vapor l i g h t i n g t h a t was i n s t a l l e d . There appears t o be general agreement t h a t t h e houses a r e unsuitable f o r r e s i d e n t i a l l i v i n g . A l o c a l r e a l t o r t e s t i f i e d t h a t it w a s "inappropriate" t h a t t h e p r o p e r t i e s be zoned s i n g l e family r e s i d e n t i a l . The former c i t y engineer, though t e s t i f y i n g f o r t h e City, s t a t e d t h a t he would "not want t o l i v e i n one of those houses." The City Planning Depart- ment representative t e s t i f i e d t h a t he does not consider it appropriate t o have r e s i d e n t i a l housing along t h a t s e c t i o n of 24th S t r e e t W e s t . The City Zoning Commission i n f a c t recommended t h e zoning change which w a s denied by t h e City Council. The D i s t r i c t Court said: "By reason of changed conditions on 24th S t r e e t West, s a i d p r o p e r t i e s a r e no longer d e s i r a b l e f o r r e s i d e n t i a l use and cannot be p u t t o t h e highest and b e s t use without a change i n zoning r e s t r i c t i o n s and regulations." The D i s t r i c t Court, however, found t h a t t h e conditions on 24th S t r e e t West w e r e not caused by t h e City but by persons using business establishments s i t u a t e d on 24th S t r e e t W e s t ; t h a t t h e widening p r o j e c t of 1 9 7 8 merely accomodated t h e e x i s t i n g t r a f f i c i n a "more e f f i c i e n t , more s a f e , less noisy manner and with less p o l l u t i o n p o t e n t i a l ; " t h a t t h e deed r e s t r i c t i o n s w e r e more r e s t r i c t i v e than t h e R-7200 zoning; t h a t t h e p l a i n t i f f s ' r e a l p r o p e r t i e s w e r e less valuable i n t h e i r p r e s e n t s i t u s than they would be i n a d i f f e r e n t neighborhood, b u t t h a t nevertheless t h e value of t h e i r r e a l p r o p e r t i e s had n o t been s u f f i c i e n t l y lessened t o c o n s t i t u t e a taking by t h e C i t y of B i l l i n g s ; t h a t t h e a c t i o n s of t h e C i t y of B i l l i n g s w e r e w i t h i n t h e proper e x e r c i s e of t h e C i t y ' s p o l i c e power. I s s u e s r a i s e d by t h e p l a i n t i f f s a r e t h a t (1) t h e D i s t r i c t Court e r r e d i n holding t h e r e was no inverse condemnation; ( 2 ) t h e D i s t r i c t Court e r r e d i n holding t h a t t h e C i t y of B i l l i n g s a c t e d within its p o l i c e power and t h a t it w a s not l i a b l e f o r damages; ( 3 ) t h e D i s t r i c t Court e r r e d i n f a i l i n g t o t a k e j u d i c i a l n o t i c e of its own f i l e s and decisions i n two c i v i l causes involving r e s t r i c t i o n s on nearby p r o p e r t i e s ; and ( 4 ) t h e D i s t r i c t Court e r r e d i n holding t h a t t h e p r i v a t e deed r e s t r i c t i o n s precluded any claim f o r damages f o r i n v e r s e condemnation. The C i t y contends t h a t t h e only i s s u e s on t h i s appeal a r e whether t h e C i t y caused t h e p l a i n t i f f s ' real p r o p e r t i e s t o be i n v e r s e l y condemned because of changes i n t h e conditions of 24th S t r e e t W e s t o r by f a i l u r e t o g r a n t a zone change o r both. W e t u r n f i r s t t o a consideration of whether under t h e f a c t s of t h i s case, an inverse condemnation of p l a i n t i f f s ' propertksoccurred. The C i t y vigorously contends, and t h e D i s t r i c t Court agreed, t h a t t h e a c t i o n s of t h e City w e r e in response t o t h e burgeoning development of commercial and o t h e r e n t e r p r i s e s along 24th S t r e e t W e s t . The City f u r t h e r contends, and t h e D i s t r i c t Court agreed, t h a t t h e City, i n responding t o those burgeoning pressures, v a l i d l y exercised its p o l i c e power i n widening t h e street, i n s t a l l i n g high i n t e n s i t y l i g h t s , and providing t r a f f i c s i g n a l s t o f a c i l i t a t e a g r e a t e r flow of traffic past plaintiffs' properties. In essence, the City is claiming, and the District Court agreed, that it did not create the business growth, it merely adapted to it. It is probable that there are few, if any, cases of inverse condemnation in which the same argument could not be made. In that area of law where inverse condemnation has most notably expanded--where airports have been constructed in populated areas and the resultant low-flying landing and take-off of jets has disturbed residential properties-- it is certainly true that the airport authorities have merely adapted to changing transportation patterns from land traffic to air traffic in providing airports. Yet the cases recognize that inverse condemnation has occurred, and recovery is allowed on the principle that an "air easement" has been taken, Griggs v. County of Allegheny, Pennsylvania (1962), 369 U.S. 84, 82 S.Ct. 531, 7 L.Ed.2d 585; United States v. Causby (1946), 328 U.S. 256, 66 S.Ct. 1062, 90 L.Ed. 1206; or upon the theory of nuisance, Thornburg v. Port of Portland (1962), 233 Or. 178, 376 P.2d 100. It is not, however, a complete defense to an inverse condemnation suit that the authority was exercising police power. There is no question that here the City of Billings was validly exercising its police power. That fact, however, standing alone, does not prevent an inverse condemnation suit. In Mattoon v. City of Norman (Okla. 1980), 617 P.2d 1347, the plaintiff commenced a class action for inverse con- demnation against the City because of the adoption of a flood plain ordinance which operated to take plaintiff's property without due process of law. The city claimed it was validly exercising its police power. The Oklahoma court said: "The defendant claims t h a t t h e Ordinance i s a v a l i d exercise of its p o l i c e power through zoning and cannot c o n s t i t u t e a governmental ' t a k i n g e of property. This i s not t h e test i n Oklahoma. W e have never held t h a t a finding t h a t t h e e x e r c i s e of police power i s v a l i d absolutely precludes compensation f o r property taken o r damaged by such exercise. I n EClting c a s e s ] , w e said: " ' I t is a universal p r i n c i p l e t h a t wherever an individual' s r i g h t of ownership of property i s recognized i n a f r e e government, o t h e r r i g h t s become worthless i f t h e government possesses uncon- t r o l l a b l e power over t h e property of t h e individual. The c o n s t i t u t i o n a l guaranty of t h e r i g h t t o own and use property i s unquestioned. Thus t h e claim t h a t p a r t i c u l a r a c t i o n is taken under t h e p o l i c e power cannot j u s t i f y disregard of c o n s t i t u t i o n a l i n h i b i t i o n s . ' " 617 P.2d a t 1349. Nor i s it important t h a t an a c t u a l physical taking of t h e p l a i n t i f f s ' properties h a s not occurred. Montana h a s a c o n s t i t u t i o n a l provision, A r t . 11, 5 29, which states: "Eminent Domain,. P r i v a t e property s h a l l not be taken o r damaged f o r public use without j u s t compensation t o t h e f u l l e x t e n t of t h e l o s s having been f i r s t made t o o r paid i n t o c o u r t f o r t h e owner. I n t h e event of l i t i g a t i o n , j u s t compensation s h a l l include necessary expenses of l i t i g a t i o n t o be awarded by the court when t h e p r i v a t e property owner p r e v a i l s . " (Emphasis added. ) This c o u r t recognized inverse condemnation without physical invasion of t h e property i n Less v. City of Butte (1903), 28 Mont. 27, 72 P. 140. There t h e court recognized the words "or damaged" i n t h e then e x i s t i n g c o n s t i t u t i o n and said: " I t s e e m s very c l e a r t o us t h a t t h i s s e c t i o n was d r a f t e d i n t h e broad language s t a t e d f o r t h e express purpose of preventing an unjust o r a r b i t r a r y exercise of t h e power of eminent domain. It overturns t h e doctrine t h a t one owning c i t y o r town property must continually l i v e i n dread of t h e changing whims of successive boards of aldermen. Constitutions which provide t h a t ' p r i v a t e property s h a l l not be taken f o r public use without j u s t compensation' a r e but declaratory of t h e common law, and contemplate t h e physical taking of property only. Under c o n s t i t u t i o n s which provide t h a t property s h a l l not be 'taken o r damaged' it i s u n i v e r s a l l y held t h a t 'it i s not necessary t h a t t h e r e be any physical invasion of t h e i n d i v i d u a l ' s property f o r p u b l i c use t o e n t i t l e him t o compensa- t i o n . " 72 P. a t 1 4 1 . The respected former chief judge of t h e Court of Appeals f o r t h e Tenth C i r c u i t , t h e Hon. Alfred Murrah, proposed t h i s test, though w r i t i n g i n a d i s s e n t , f o r i n v e r s e condemnation: "As I reason, t h e c o n s t i t u t i o n a l test in each c a s e is f i r s t , whether t h e a s s e r t e d i n t e r e s t is one which t h e law w i l l p r o t e c t ; i f so, whether t h e i n t e r f e r e n c e is s u f f i c i e n t l y d i r e c t , s u f f i c i e n t l y p e c u l i a r , and of s u f f i c i e n t magnitude t o cause us t o conclude t h a t f a i r n e s s and j u s t i c e , a s between t h e S t a t e and t h e c i t i z e n , r e q u i r e s t h e burden imposed t o be borne by t h e p u b l i c and not by t h e individual alone." Batten v. United S t a t e s (10th C i r . 1962), 306 F. 2d 580, 587, cert.den., 371 U.S. 955, 83 S.Ct. 506, 9 L.Ed.2d 502. Here t h e a s s e r t e d i n t e r e s t of t h e property owners is one which t h e law w i l l p r o t e c t . C e r t a i n l y t h e r i g h t t o t h e peaceful possession of r e s i d e n t i a l property is t h e b a s i s of such cases as Causby and Griggs, supra. The i n t e r f e r e n c e w i t h p l a i n t i f f s ' p r o p e r t i e s has been d i r e c t ; it i s p e c u l i a r i n t h e s e n s e t h a t t h e f a c t s here are unique; and t h e i n t e r - ference is of s u f f i c i e n t c o n s t i t u t i o n a l magnitude s i n c e t h e proof i n t h i s case showed t h a t t h e r e had been a 20 t o 30 percent reduction i n t h e value of t h e individual r e s i d e n t i a l p r o p e r t i e s , and t h a t t h e value of each " a s i s " is $10,000 t o $15,000 less than t h e i r values i f t h e a r e a w e r e zoned r e s i d e n t i a l professional. Though no physical taking has occurred, t h e r e s u l t of t h e C i t y ' s a c t i o n s h a s been t o impose a s e r v i t u d e , a l i m i t a t i o n upon t h e use and m a r k e t a b i l i t y of p l a i n t i f f s ' p r o p e r t i e s a s r e s i d e n t i a l . Not t o be f o r g o t t e n is t h e condemnation by t h e C i t y of property from one s i d e of t h e street, and not from t h e o t h e r s i d e where t h e p l a i n t i f f s r e s i d e , i n t h e 1976-78 widening of 24th S t r e e t W e s t . The owners on t h e e a s t s i d e of t h e street w e r e compensated e i t h e r i n eminent domain proceedings, o r by agreement with t h e City. The s i n g l i n g o u t of one group a s a g a i n s t another t o bear a burden weighed heavily i n Branning v. United S t a t e s . ( C t . C 1 . 1981) , 654 F. 2d 88. I n t h a t case, t r a i n e e s a t a United S t a t e s Marine Corps A i r S t a t i o n , i n p r a c t i c i n g f o r landings on c a r r i e r decks, w e r e required t o hold t h e i r j e t a i r p l a n e s with noses up and t a i l s down, and w i t h near maximum power and n o i s e associated with low speed. This e x e r c i s e was conducted over t h e p l a i n t i f f ' s land. The A i r Corps could have performed t h i s e x e r c i s e elsewhere b u t s e l e c t e d a i r space over t h e p l a i n t i f f ' s land f o r it because a l t e r n a t i v e l o c a t i o n s were deemed more objection- able. The Court of Claims said: "Thus, p l a i n t i f f w a s consciously s i n g l e d o u t o r s e l e c t e d t o bear a burden which defendant a l s o consciously e l e c t e d not t o impose on o t h e r s , even o t h e r s otherwise s imilarly s i t u a t e d . This is a c l a s s i c statement of a taking s i t u a t i o n . " 654' F.2d a t 90. W e t h e r e f o r e hold and conclude t h a t under t h e unique f a c t s of t h i s case, t h e City of B i l l i n g s , although e x e r c i s i n g i t s p o l i c e power v a l i d l y , and v a l i d l y r e f u s i n g t o amend i t s zoning ordinance on p l a i n t i f f s ' p e t i t i o n , nonetheless thereby i n t e r f e r e d with t h e p r i v a t e property i n t e r e s t s of t h e p l a i n t i f f s o a s t o c o n s t i t u t e a "taking" by inverse condemnation. W e caution t h a t t h i s holding i s l i m i t e d t o t h e s i t u a t i o n here, where a physical taking across t h e street occurred. W e t u r n now t o consider whether t h e d e c l a r a t i o n of r e s t r i c t i o n s of L i l l i s Subdivision l i m i t i n g t h e use of p l a i n t i f f s ' l o t s t o r e s i d e n t i a l purposes u n t i l t h e year 2000 prevents recovery through inverse condemnation. O n a n a l y s i s one must concede, it seems t o us, t h a t t h e presence of t h e p r i v a t e deed r e s t r i c t i o n s i n L i l l i s Subdivison i s a non s e q u i t u r a s a defense t o inverse condemnation here. The r e s t r i c t i o n s contemplate t h e use of p l a i n t i f f s ' residences f o r r e s i d e n t i a l purposes. It is not t h e r e s t r i c t i o n s t h a t a r e damaging p l a i n t i f f s ' p r o p e r t i e s ; it i s t h e a c t i o n of t h e C i t y i n making t h e improvements t h a t is making t h e i r p r o p e r t i e s nearly unusable and unmarketable f o r r e s i d e n t i a l purposes. Under s e c t i o n 76-2-305, MCA, t h e C i t y Council v a l i d l y refused t o amend t h e zoning ordinance f o r p l a i n t i f f s ' p r o p e r t i e s t o r e c l a s s i f y t o r e s i d e n t i a l professional, which would have s u b s t a n t i a l l y mitigated t h e p l a i n t i f f s ' l o s s e s . The v a l i d r e f u s a l of a zoning amendment, which n a i l e d down t h e s e r v i t u d e imposed on p l a i n t i f f s ' p r o p e r t i e s , stands on no higher ground, i n s o f a r as inverse condemnation i s concerned, than a v a l i d e x e r c i s e of p o l i c e power. What remains, above a l l , a f t e r t h e C i t y has acted, v a l i d l y o r i n v a l i d l y , is t h a t p l a i n t i f f s ' p r o p e r t i e s , through t h e a c t i o n s of t h e C i t y , have become unsuitable f o r r e s i d e n t i a l use, and t h e p l a i n t i f f s ' r i g h t t o use t h e i r p r o p e r t i e s a s contemplated by t h e deed r e s t r i c t i o n s is l i m i t e d t o a degree of c o n s t i t u t i o n a l magnitude. I n t h i s connection, p l a i n t i f f s asked during t h e t r i a l t h a t t h e D i s t r i c t Court t a k e j u d i c i a l n o t i c e of two of its own f i l e s , wherein t h e same D i s t r i c t Court had held t h a t s i m i l a r r e s t r i c t i o n s on nearby p r o p e r t i e s w e r e void and unenforceable by reason of t h e changed conditions on and near 24th S t r e e t W e s t . While t h e f i l e s w e r e c e r t a i n l y r e l e v a n t under t h e view taken by t h e D i s t r i c t Court t h a t t h e deed r e s t r i c t i o n s prevented p l a i n t i f f s ' recovery i n inverse condemnation, i k i s our view t h a t t h e deed r e s t r i c t i o n s only contemplate a r e s i d e n t i a l use which cannot now be obtained by t h e p l a i n t i f f s . It i s t h e r e f o r e immaterial t o our d e c i s i o n t h a t t h e D i s t r i c t Court d i d not take j u d i c i a l n o t i c e of t h e o f f e r e d c i v i l f i l e s , because t h e presence of t h e deed r e s t r i c t i o n s i s not a bar t o p l a i n t i f f s ' a c t i o n f o r i n v e r s e condemnation. The finding of t h e D i s t r i c t Court t h a t t h e improvement of 24th S t r e e t W e s t "accomodates t h e e x i s t i n g t r a f f i c i n a more e f f i c i e n t , more s a f e , less noisy manner and with less p o l l u t i o n p o t e n t i a l " i s c l e a r l y erroneous. Rule 5 2 ( a ) , M.R.Civ.P. The p l a i n t i f f s here t e s t i f i e d i n d e t a i l a s t o t h e e f f e c t of t h e improvements and t h e conditions which severely l i m i t e d t h e use of t h e i r p r o p e r t i e s f o r r e s i d e n t i a l purposes. The testimony of t h e c i t y engineer, on which t h e D i s t r i c t Court apparently r e l i e d , was taken from n a t i o n a l s t u d i e s and n a t i o n a l guides f o r improvements, not d i r e c t l y r e l a t e d t o p l a i n t i f f s ' p r o p e r t i e s . N o attempt was made by t h e City t o rebut t h e testimony of t h e property owners a s t o n o i s e , t r a f f i c and p o l l u t i o n . The D i s t r i c t Court, i n its findings, set f o r t h t h e purchase p r i c e s paid by t h e p l a i n t i f f s f o r t h e i r residences a s compared t o t h e i r "as i s " values a f t e r t h e 1976-78 improvements t o 24th S t r e e t W e s t . I n each instance t h e p r i c e paid f o r t h e property i s less than t h e "as i s " value. Thus, t h e D i s t r i c t Court apparently found no damages s u f f e r e d by p l a i n t i f f s . I n e f f e c t , t h e D i s t r i c t Court gave t h e City t h e advantage of i n f l a t i o n , which has a f f e c t e d t h e value not only of property on 24th S t r e e t W e s t , but of a l l real property i n B i l l i n g s . However, t h e measure of damages i n an inverse condemnation case is t h e d i f f e r e n c e between t h e f a i r market value of t h e property before and a f t e r t h e condemnation. The r e l e v a n t values i n t h i s case a r e t h e f a i r market value as r e s i d e n t i a l property before t h e condemnation, and t h e f a i r market value by reason of t h e depreciation a s r e s i d e n t i a l property (see s e c t i o n 70-30-302, MCA), where the property not taken has been i n j u r i o u s l y a f f e c t e d . In c a s e it i s important a f t e r remand, t h e r i g h t t o an i n v e r s e condemnation remedy does not pass t o subsequent purchasers a f t e r t h e inverse condemnation. Williams v. City of Valdez (Alaska 1981), 624 P.2d 820. W e t h e r e f o r e remand t h i s cause t o t h e D i s t r i c t Court with d i r e c t i o n s t o e n t e r an order t h e r e i n t h a t t h e r e s i d e n t i a l p r o p e r t i e s of t h e p l a i n t i f f s have been inversely condemned by t h e C i t y of B i l l i n g s i n making t h e improvements t o 24th Street W e s t i n 1976-78, which order s h a l l s e r v e t h e o f f i c e of a preliminary condemnation order a s provided i n s e c t i o n 70-30-206(2), MCA; and thereupon t o t a k e such f u r t h e r nroceedings under t h e s t a t u t e s r e l a t i n g t o eminent domain as s h a l l determine t h e damages, i f any, sustained by t h e p l a i n t i f f s . / 1 W e Concur: / L J-6L2--4--hLLk;$ &---- ,J J u s t i c e ". \ chief Justice,