Opinion ID: 1594187
Heading Depth: 2
Heading Rank: 2

Heading: Deductions from just compensation for the enhanced value of the remaining property.

Text: ¶ 15. In Hancock and Bridgforth, the Commission's expert appraisers asserted that the value of the remaining property was enhanced by the taking. Hancock, 309 So.2d at 870. Bridgforth, 709 So.2d at 440. The expert appraisers also contended that the landowners' damages should be reduced by the enhanced value of the remaining property. Hancock, 309 So.2d at 870; Bridgforth, 709 So.2d at 440. However, in both Hancock and Bridgforth, this Court held that expert appraisers may not consider the enhanced value of the remaining property when determining its fair market value. Hancock, 309 So.2d at 870; Bridgforth, 709 So.2d at 440. In this case, the Commission's expert appraiser gave no testimony requesting that Trowbridge's damages be reduced by the enhanced value of the remaining property. Moreover, the judge instructed the jurors not to consider any enhancements conferred on the property by the taking. ¶ 16. Despite the lack of evidence to support Trowbridge's claim, it alleges that Wells testified that there were various damages to the remainder property. Because Wells concluded that the per-acre value of the remainder property was the same before the taking and after the taking, Trowbridge finds error with his assessment of compensation. Trowbridge asserts that Wells's assessment of compensation did not account for all of the alleged damages to the remainder property. Trowbridge directs this Court's attention to Wells's testimony and explanation of his opinion as to the value of the remainder property. Q. What is that opinion? A. It was the same as the value in the before, $4.30. Q. And I'd like to point out that although we're talking about the property in the before and the property in the after being two different sizes, the property in the after being a lot smaller than the before, I'm still indicating the same value per square foot; but you have a different scenario in the after as you did in the before. Q. Mr. Wells, did you take into consideration the change in the access from 51 as opposed to the before and the after? A. Yes, I did. Q. All right. Now what if any other damage did you determine the landowner were [sic] due? A. In the before scenario, we said that this property had frontage of approximately 1100 feet that ran along Hoy Road where any development could access the availability of utilities  water, electrical, and gas  that were, you know within easement along this right of way. (Emphasis added). ¶ 17. Trowbridge contends that Wells's different scenario testimony supports its position that he did not account for all the damages to the remainder property and that he reduced his assessment of damages by the enhanced value of the remaining parcels. However, Trowbridge takes Wells's different scenario testimony out of the context in which it occurred. Before giving his assessment of compensation, Wells explained that he relied on comparable sales to determine the fair market value of the property. Wells further explained each comparable sale and the adjustments made to ensure that they were similar to this sale. In each of the comparable sales, Wells made a positive adjustment for the irregular shape of the remaining parcels and the additional cost of development. ¶ 18. Wells's testimony regarding the different scenario in the before and the after condition of the remaining property relates to the irregular shape of the parcels and the increased development cost. Although Wells did not agree with Trowbridge regarding the extent of the damages to the remainder property, he made no error in testifying that the fair market value of the remainder property was the same before and after the taking. Green Acres Mem. Park v. Miss. Highway Comm'n, 246 Miss. 855, 863, 153 So.2d 286, 289-90 (1963) (holding that there is no requirement in eminent domain proceedings that an expert appraiser regard the taking as damaging to the remainder). II. Whether the Trial Court Erred in Allowing the Commission's Expert Appraiser, Terry Wells, to Testify that the Remainder Property is Zoned for General Commercial Development but that the Lesser Included Use Restricted Commercial Development is the Highest and Best Use of the Property. ¶ 19. Trowbridge argues that Wells improperly disregarded the zoning classifications when determining the highest and the best use of the remainder property. Trowbridge relies on Dennis v. City Council of Greenville, 646 So.2d 1290 (Miss.1994) and Mississippi Highway Commission v. Wagley, 231 So.2d 507, 509 (Miss.1970) to support its argument that property must be evaluated under the existing zoning restrictions; therefore, Trowbridge asserts, the trial judge erred in allowing Wells to testify that the highest and best use was a lesser included use of restricted commercial development, when the subject property was zoned for general commercial development. Trowbridge also argues that Wells did not provide any evidence that a change in zoning was likely to occur, and instead, acted as if the subject property had already been rezoned for restricted commercial development. ¶ 20. In Dennis v. City Council of Greenville , the City's appraiser testified that the highest and best use of the property was for agricultural development, although the zoning classification for the property was for residential development. Dennis v. City Council of Greenville, 646 So.2d 1290, 1291 (Miss.1994). In Dennis, this Court reiterated its holding in Mississippi Highway Commission v. Wagley that property in eminent domain proceedings must be evaluated in accordance with the restrictions of existing zoning classifications, and that consideration must be given to the impact potential zoning changes may have on the fair market value of the subject property. Dennis, 646 So.2d at 1294 (citing Wagley, 231 So.2d 507, 509 (Miss.1970)). This Court further held that the trial judge disregarded the existing zoning restrictions. Id. The City's appraiser evaluated the land under the restrictions of agricultural development, although the property was zoned for residential development. Id. This Court concluded that even if there was a potential change of the zoning classification of the landowners' property from residential to agricultural development, the City's appraiser evaluated the property as if the rezoning had already occurred, when no such changed had occurred. Id. ¶ 21. Clearly, this is not the same factual situation as the present case. Trowbridge's reliance on Dennis is misplaced for two reasons. First, in contrast to Dennis, the Commission's expert appraiser, Wells, did not conclude that the highest and best use of the property was a potential use not allowed by the existing zoning restrictions. Instead, Wells opined that, although the property was zoned for C-2 general commercial development, the highest and best use of property was for C-1 restricted commercial development, a lesser included use of property zoned for general commercial development. ¶ 22. Second, unlike this case, the trial court in Dennis refused to consider the valuation of the landowner's appraisers. Dennis, 646 So.2d at 1293. The Court stated: [T]he trial court, by not allowing the landowners to put the testimony of expert appraisers into evidence regarding sales of lots for single-family residences, thereby prevented the landowners from substantiating their valuation and appraisals with comparables. Consequently, the landowners' evidence, which would have provided an alternative valuation for consideration and which may have refuted the City's valuation testimony which was supported by comparables of distant agricultural sales, was excluded from evidence by the trial judge. Id. In the present case, the testimony of Trowbridge's expert appraiser that the best use of the subject property was retail commercial use was allowed. Therefore, valuations by both parties' expert appraisers were admitted to be considered by the jurors in reaching their decision. ¶ 23. Further, this Court's discussion of expert valuation testimony in Potters II v. State Highway Comm'n is particularly relevant to Mr. Well's testimony in this case. Potters II v. State Highway Commission, 608 So.2d 1227, 1233 (Miss.1992) The Court in Potters II stated: Oftentimes parties to eminent domain proceedings proceed within broad, general use categories and talk of commercial use and residential use and the like. See, e.g., Howell v. State Highway Commission of Mississippi, 573 So.2d 754, 755 (Miss.1990); Dykes v. State Highway Commission of Mississippi, 535 So.2d 1349, 1351 (Miss.1988). On other occasions, not inappropriately, these broad categories are narrowed so that a highest and best use for a given property may be for multi-family residences as distinguished from single-family dwellings, see, e.g., Hudspeth v. State Highway Commission of Mississippi, 534 So.2d 210, 211 (Miss.1988). Within commercial properties, there are many uses of differing values. Franklin County Timber talks of sawmilling as the most profitable use. We think it fair on the present facts that expert valuation testimony may assume the highest and best use of subject property was as a fast food restaurant. We say this notwithstanding that MSHC Appraiser Pritchard limited himself to the broader characterization: commercial. Obviously, the extent to which the categories are narrowed is a matter of professional judgment and, within limits, experts may give their opinion regarding the appropriate level of specificity. (Emphasis added). Id. Accordingly, we find that Well's testimony that a lesser included use of the existing zoning restrictions was the highest and best use of property for purposes of valuation was permissible. Because Wells evaluated the subject property in accordance with the legal parameters of the existing zoning restrictions, there was no requirement that any consideration should have been given to potential zoning changes.