Opinion ID: 891609
Heading Depth: 3
Heading Rank: 3

Heading: excess construction costs

Text: {37} Primetime sought compensation for the following amounts as excess construction costs. Admin. Time 5,000.00 Buttress Wall 76,856.94 Hussein Salary 37,864.14 Mayan Construction 23,196.77 LSC Landscaping 1,465.50 Cartesian 507.04 Custom Grading 5,400.00 Vineyard 502.61 Builders Risk 1,089.14 Pat Richardson 1,236.64 Fence 400.00 Total: 153,518.45 [3] {38} The district court found that [a]s a direct result of the City's encroaching waterlines, [Primetime] incurred additional construction costs it would not have otherwise been required to spend in the amount of $153,518.45. (Emphasis added.) This finding is not challenged by the City. Instead, the City argued on appeal that these expenses represent consequential damages not recoverable in New Mexico in an inverse condemnation proceeding. Primetime, 2007-NMCA-129, ¶ 1, 142 N.M. 663, 168 P.3d 1087. {39} Without directly answering whether these excess construction costs were consequential damages, the Court of Appeals upheld all of the expenses awarded by the district court with the exception of the buttress wall as excess construction costs incurred as the direct result of the taking. Id. ¶¶ 23-24. The Court of Appeals reasoned that these costs were imposed on Primetime by the City and were similar to the repair and restoration expenses allowed in General Motors and Kimball, and the special damages allowed in partial takings cases in New Mexico under UJI 13-705 NMRA. Primetime, 2007-NMCA-129, ¶ 23, 142 N.M. 663, 168 P.3d 1087. {40} The Court of Appeals singled out the expenses for the buttress wall, finding that the expenses were not strictly required by the City's taking. Id. ¶ 24. The Court of Appeals agreed that these expenses represented an effort by Primetime to mitigate its damages. Id. However, the Court of Appeals correctly declined to invalidate the damages simply because they might represent an effort to mitigate harm. See id. ¶ 25. The Court of Appeals reasoned that to disallow all awards for mitigation efforts would discourage remedial efforts designed to reduce losses. Id. As a result, the Court of Appeals concluded that where costs are incurred to mitigate damages caused by a temporary physical taking, courts must apply a test of reasonableness under the circumstances to determine whether the costs of mitigation were justified. Id. ¶ 26. The Court of Appeals believed that the district court had not fully demonstrated whether the cost of the buttress wall was reasonable, and remanded for this determination. Id. ¶¶ 25-26. {41} We agree with the Court of Appeals' basic holding that remedial construction costs are awardable in condemnation cases when they are the direct result of the taking. In temporary takings cases, the government must compensate for the losses resulting from damage to the condemnee's property. See, e.g., General Motors, 323 U.S. at 384, 65 S.Ct. 357 (holding that the lost value of damaged or destroyed fixtures or permanent equipment is compensable); Eyherabide v. United States, 170 Ct.Cl. 598, 345 F.2d 565, 570 (1965) (The measure of plaintiffs' recovery is for the temporary taking.. . . This standard, differing somewhat from that applicable where a full interest is acquired, allows not only compensation for the use and occupancy of the property but also for the loss of improvements and the cost of placing the property in its pre-taking condition (if it has diminished in value).). Thus, any construction costs necessary to put Primetime in the position it would have been in had no taking occurred are compensable in this temporary taking. {42} In this case, the characterization of the damages for the buttress wall as mitigation damages is not necessary to determine whether they were compensable. The question is whether such expenses were the direct result of the City's admitted inverse condemnation of this property. If so, such damages should be recoverable as just compensation. The district court's unchallenged finding was that the excess construction costs, including the buttress wall, were a direct result of the City's admitted inverse condemnation. Primetime built the buttress wall for the sole purpose of making up for time lost due to the City's actions. Thus, its expenses are compensable. {43} Of course, the expenses must also be reasonable, as the Court of Appeals correctly observed. We note that at trial, uncontradicted testimony was elicited that the buttress wall had reduced construction time by about a month. Primetime points out that since the loss for 142 days was $456,242, the loss for 30 days, calculated by taking the average loss for each day, came to $96,386.15, a significantly higher sum than the $76,856.94 spent on the buttress wall. Therefore, there is substantial evidence in the record demonstrating the reasonableness of this expenditure to reduce delay and its concomitant cost to the City. We need not remand to the trial court to restate what appears well-supported in the record. Accordingly, we affirm the district court's award of $153,518.45 for excess construction costs.