Court Opinion

ID: 7350169
Source: CourtListenerOpinion
Date Created: 2022-07-26 01:55:11.749549+00
Date Added: 2024-06-11T16:20:26.818139
License: Public Domain

BISCHOFF, J.
[1-3] Analysis of the awards made to the owner, lessee, and sublessee for the taking of premises Nos. 119-121 Walkei street discloses error of principle which calls for a new estimate. The premises consisted of a lot of land 50 by 100 feet, upon which was erected a four-story loft building. A ground lease to the tenant Harder had an unexpired term of seven years when title vested in the city. Under this lease the tenant was to pay in the form of rent and taxes approximately $3,000 per annum, and was entitled to the reasonable value of the building at the expiration of the term. Harder had made a sublease to one Levy for the full term of the main lease at a rental of $6,000 per annum. An award for the premises in gross has been made in the sum of $100,381, of which $40,100 is awarded to the owner, $39,281 to the lessee, and $21,000 to the sublessee. The leasehold interests in gross as thus estimated amount to 60 per cent, of the full fee value where the lease had about seven years to run, an apportionment which indicates upon its face an injustice to the owner, unless the real value of the premises is to be found in the building, not in the land, or the rental reserved was unreasonably low.
From the proof it appears, however, that the building was not an adequate improvement, that its value was less than one-third of the total value of the parcel, and that the rental of $6,000 per annum paid by Levy was justified mainly by his need of obtaining space to be used in connection with adjoining premises in which his business had become established. Assuming, however, that the $6,000 rental is based on none but ordinary market conditions, the award to the sublessee is clearly excessive, since it indicates that he has obligated himself to pay $3,000 per annum less than the real net rental value; but it is impossible to find from the evidence that these premises could have a net rental value of $9,000 a year. The estimates of leasehold values testified to by the witness Green were quite clearly opposed to reason, according to the basis given by the witness himself for the figures which he adopted.
Again, if $9,000 were the net rental value, it would represent 9 per cent, of the fee value found, an investment rate so out of proportion with the customary return from real estate as to be impossible of adoption without special circumstances to explain it, and there are none. It would appear that the principal lessee has lost a fairly profitable sublease; but if the sublessee was damaged at all, and the fact is hard' to find, his damages are to be carved out of the damages to the leasehold. An assessment of damages against the owner of the fee and in favor of the sublessee, independently of the apportionment of loss as between the owner and the' main lessee, is wholly unwarranted. While there is some opinion evidence to support the award iii gross of $100,381, the amount is objected to by the city as exces*155sive, and since an extravagant rental value has evidently been adopted by the commissioners the fee award (related as it necessarily is to rental values) should be re-examined.
So far as the words of the statute (Rapid Transit Act, § 52; Laws 1909, c. 498, § 19) appear to require the court to confirm the report upon presentation, the court’s power of review none the less exists, according to judicial interpretation of statutes .identically framed. Matter of Daly, 189 N. Y. 34, 81 N. E. 560; Matter of Gilroy, 43 App. Div. 359, 60 N. Y. Supp. 200; Id., 164 N. Y. 576, 58 N. E. 1087.
The award of $58,000 for the premises No. 142 Center street is not well open to attack upon the evidence. According to the testimony of one of the witnesses for the city the building had a value of over $5,000, treated as an improvement adequate only to carry the investment in the land, and the witnesses for the owner testified to land values in excess of $53,000. I do not find from the record that the opinions of these witnesses were necessarily confirmed by the facts, and the quantum of the award was within the commissioners’ judicial province.
Report confirmed as to premises No. 142 Center street. As to premises Nos. 119-121 Walker street, the awards are not confirmed, and a rehearing of the facts is directed before new commissioners. An order may be presented accordingly.
NEWBERGER, J., concurs.