Court Opinion

ID: 7817812
Source: CourtListenerOpinion
Date Created: 2022-09-07 17:42:22.504192+00
Date Added: 2024-06-11T16:30:38.995825
License: Public Domain

George Rose Smith, J., dissenting. The jury’s verdict in this case awarded the landowners $55,000 for 11.01 acres of land, or about $5,000 an acre. If we leave the realm of opinion and look only to actual facts established by uncontradicted evidence in the record, it is an inescapable conclusion that the highway department is beina compelled to pay an unconscionable price for the land. Hawkins "bought 117 acres in 1960 for $13,-000, thereby paying $111.11 an acre for property that is now valued at $5,000 an acre. At the time of the trial the 211 lots were assessed, on the tax books at a total of $5,275, or exactly $25 a lot. If the assessment represented 20% of the fair market value, as the law contemplates, the property was valued by the assessor at $125 a lot, or $600 an acre, there being about 4 lots to the acre. Hence the verdict can be sustained only on the basis of opinion. More specifically, it can be sustained only on the basis of Hawkins’s own opinion, for not even his own expert witnesses fixed his just compensation at a figure as high as the amount of the verdict. Thus the pivotal issue on appeal is the admissibility of the landowner’s opinion about the value of the property being taken and about the damage to the rest of his lands. Hawkins’s figures were arrived at solely by assigning a value to each lot in his addition and multiplying that value by the number of lots. He valued 165 residential lots at $1,000 each and 18 commercial acres at $4,000 an acre, making a total value of $237,000 immediately before the taking. He calculated his damages at $21,000 for 21 lots taken, $2,500 for 5 lots partly taken, $24,000 for six commercial acres taken, and $30,000 for the increased cost of laying water and sewer lines (a figure not supported bv any fact in the record), making a total of $77,500. Under our prior cases Hawkins’s opinion evidence was plainly inadmissible. His residential addition existed on paper only. It was first platted in 1960, when it seems to have been known that the interstate highway was to be located somewhere in the vicinity. It was replattecl in 1964, when more exact information about the location of the highway was available. But by the date of trial nothing had been done toward the development of the addition except a negligible amount of clearing with a bulldozer. Neither streets nor utilities had yet been provided. The tract was still raw land. Our cases uniformly hold that in such a situation it is not permissible to arrive at a valuation on the basis of individual lot values. As it happens, most of our cases have dealt with unrecorded plats, but it goes without saying that the basic rule is not changed by the mere filing of a plat with the circuit clerk. Union Elec. Power Co. v. Sauget, 1 Ill. 2d 125, 115 N.E. 2d 246 (1953); Pickett v. Kolb, 237 N.E. 2d 105 (Ind., 1968). The issue is one of substance, not of mere form. We reviewed our earlier decisions in this language in Housing Authority of the City of Camden v. Reeves, 244 Ark. 783, 427 S.W. 2d 196 (1968): We have consistently held that such a lot-and-block plat is not admissible when the subdivision has really not yet come into existence. The reason for the exclusionary rule is that such an exhibit is apt to mislead the jury into valuing the property as consisting of so many lots, without adequately considering necessary development expenses such as the construction of streets and utility lines, which could not be properly explained to the jury without bringing a, host of collateral issues into the case. Arkansas State Highway Comm. v. Parks, 240 Ark. 719, 401 S.W. 2d 732 (1966). In several of the cases relied upon by the Housing Authority, the subdivision portrayed by the plat was not beyond the planning stage, so that the admission of the plat was fairly sure to mislead the jury. That point was discussed in detail in Arkansas State Highway Comm. v. Watkins, 229 Ark. 27, 313 S.W. 2d 86 (1958), where it was admitted that the land had not been developed at all as a subdivision. Similar non-existent subdivisions were involved in Arkansas Louisiana Cas Co. v. Howard, 240 Ark. 511, 400 S.W. 2d 488 (1966), and Arkansas Louisiana Gas Co. v. Lawrence, 239 Ark. 365, 389 S.W. 2d 431 (1965). Such an exhibit is especially misleading when, as in the Watkins case, it is accompanied l)3r testimony about the value of the fictitious lots. Even more precisely in point in the case at bar is Arkansas State, Highway Commn. v. Watkins, 229 Ark. 27, 333 S.W. 2d 86 (1958), because there the plat was not introduced; so, as here, we were considering the admissibility of opinion evidence about the value of lots in an addition existing only on paper. Excerpts from the opinion: The measure of compensation is not (emphasis supplied) however, the aggregate of the prices of the lots into which the tract could best be divided, since the expense of cleaning off and improving the land, laying out streets, dividing it into lots, advertising and selling the same, and holding it and paying taxes and interest until all the lots are disposed of cannot be ignored and it is too uncertain and conjectural to be computed. The measure of compensation is the market value of the land as a whole, taking into consideration its value for building purposes if that is its most available use. ft ft ft ft “It is proper to show that the property is suitable for division into village lots, and that it is valuable for that purpose, but it is not proper to show the number and value of such lots.” Lewis, Eminent Domain, Vol. 2 (2nd Ed.) P. 1058. The majority opinion in this case cannot be reconciled with our prior holdings. Two efforts are made to distinguish the law as we have previously stated it, but neither effort can stand scrutiny. First, it is said that the highway department itself recognized “the paper lot linos'' (an apt description!) by describing the property by lot numbers in its pleadings. That procedure was unquestionably right, for when an addition has been platted a description by reference to the plat is valid. Indeed, that is ordinarily the only legal way to describe the lots. Secondly, it is said that a prudent buyer would have to do some calculation of the number of lots that could be carved out of the property in its present (undeveloped) state. Of course that is true, but exactly the same thing could have been said in the Watkins case and in our other decisions rejecting such testimony. The point is not what a prudent buyer might consider in pricing the property; it is what kind of opinion evidence is sufficiently reliable to be submitted to a jury of laymen. Our prior eases have unequivocally ruled out testimony such as Hawkins’s opinion in this case. In truth, Hawkins’s testimony is also vulnerable to the rule that an. opinion not supported by any fair or reasonable basis is not substantial evidence. Arkansas State Highway Commn. v. Stanley, 234 Ark. 428, 353 S.W. 2d 173, 4 A.L.R. 2d 749 (1962). Hawkins’s evaluation of his property at $4,000 an acre had, as we said in the Stanley case, no relation to any fact in the record. On cross-examination he conceded the purchase prices involved in many sales of comparable or even more desirable property in the same vicinity as his lands. Nor instance, the St. Anthony’s Hospital property sold for $1,200 an acre; the R. W. Morgan, Jr., property for $1,000 an acre; the Carl Long property for $1,143 an acre; the Rex Jones property for $1,365 an acre; the Hr. Mnglelioven property for $600 an acre, and the Hodge property for $600 an acre. In the teeth of all those actual sales at arm’s length Hawkins still insisted that in liis opinion his property was worth $4,000 an acre. Just as in the Stanley case, that figure “seems to have been plucked from the air and might equally well have been ten thousand dollars or a hundred million dollars." Such fanciful figures are not substantial evidence. I would reverse the judgment and remand the cause for a new trial. Brown, J., joins in this dissent.