Court Opinion

ID: 4183325
Source: CourtListenerOpinion
Date Created: 2017-07-04 07:08:46.562596+00
Date Added: 2024-06-11T07:47:18.648115
License: Public Domain

THIRD DIVISION
                            ELLINGTON, P. J.,
                        ANDREWS and RICKMAN, JJ.

                   NOTICE: Motions for reconsideration must be
                   physically received in our clerk’s office within ten
                   days of the date of decision to be deemed timely filed.
                               http://www.gaappeals.us/rules

                                                                     June 15, 2017

In the Court of Appeals of Georgia
 A17A1292. DEKALB COUNTY v. SPEIR et al.

      ANDREWS, Judge.

      In May 2013, Dekalb County condemned 0.069 acres of land located at the

intersection of LaVista Road and Oak Grove Road for road and sidewalk

improvements. Following a trial to establish just and adequate compensation, the jury

awarded $313,000 to Jack Speir, the property owner, and $671,000 to Oe Gon Kim

and J. K. Cleaners, Inc. (collectively “J. K. Cleaners”), owner/operators of the dry

cleaning business that leased the property. The trial court entered judgment on the

verdict, and the County appeals. For reasons that follow, we affirm.

      The evidence shows that prior to the road work associated with the

condemnation, J. K. Cleaners’ business sat on a “prominent corner” with three

driveways that allowed cars to enter and exit the site easily from Lavista Road or Oak
Grove Road. The road improvements, however, closed two of the three driveways and

reduced the overall property size, significantly impacting access to the business and

restricting the available parking area. According to the County’s appraiser, the

alterations rendered the property’s use as a dry cleaning business “precarious” and not

viable.

      The parties offered conflicting expert testimony regarding the amount of just

compensation owed following the taking. With respect to J. K. Cleaners, the County’s

expert testified that the business had experienced a loss in value of $101,000. J. K.

Cleaners’ business appraiser, however, valued the loss much higher, asserting that the

business was worth $440,000 before the taking and had no value after, given the

extreme alterations to the site. He further testified that J. K. Cleaners was obligated

to continue making payments under its lease on the property through 2017, resulting

in further losses of $400,984. Adding these two loss values together, the expert

calculated just and adequate compensation for J. K. Cleaners as $841,000.

      Prior to trial, the County moved in limine to exclude evidence regarding J. K.

Cleaners’ post-taking lease obligations. The trial court denied the motion and

admitted the evidence. In its sole enumeration of error on appeal, the County

challenges this evidentiary ruling.

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      We find no error. A lessee that operates a business on condemned property may

recover post-taking business losses as an element of just and adequate compensation

“if the property is ‘unique’ and the loss is not remote or speculative.” DOT v. Acree

Oil Co., 266 Ga. 336-337 (1) (467 SE2d 319) (1996). Business loss evidence,

therefore, “is admissible in a condemnation action where such losses are sought as a

separate element of damages as to unique or peculiar property as well as when such

evidence shows a diminution of value of the land not taken.” DOT v. Arnold, 243 Ga.

App. 15, 18 (1) (530 SE2d 767) (2000) (citations and punctuation omitted).

      J. K. Cleaners offered testimony that the condemned property, with its

particular location and multiple access points, was unique, raising a jury question on

uniqueness. See Toler v. DOT, 328 Ga. App. 144, 146 (1) (761 SE2d 550) (2014)

(“The issue of whether a business property is ‘unique’ so as to support an award of

business loss is a question for the jury.”). The presentation of business loss evidence,

therefore, was appropriate. See Arnold, supra. The County argues, however, that such

evidence should have been limited to the market value of the business before the

taking and immediately after, and should not have included any discussion of future,

post-taking lease liability.

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      We disagree. Generally, “[t]he correct measure of damages that a lessee

condemnee can recover for damage to his business is the difference in market value

of the business prior to and after the taking.” Action Sound v. DOT, 265 Ga. App.

616, 619 (2) (594 SE2d 773) (2004). As we have explained, however, “[e]vidence of

any business losses which result in a diminution of the value of a condemnee’s

business is admissible.” Id. (punctuation and footnote omitted; emphasis in original).

J. K. Cleaners’ appraiser testified that the taking not only depleted all value from the

dry-cleaning business, but also saddled the company with a worthless lease obligation

that it was contractually obligated to pay for several more years. Based on this

testimony, counsel argued to the jury that the circumstances created a negative market

value for which the company should be compensated:

      I think of this argument as a less than zero argument. [The County]
      made the value of the business less than zero. [The County] made it
      where not only would someone not pay you for it, it’s a liability. . . .
      After the taking you’ve got less than zero, because you’ve got $400,000
      in rent liability, so it’s less than zero.

      J. K. Cleaners connected the future rent payments to the market value of its

business just after the taking, bringing this evidence within the ambit of business loss.

See Old South Bottle Shop v. DOT, 175 Ga. App. 295, 296 (2) (333 SE2d 127) (1985)

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(trial court erred in excluding business loss testimony regarding cash flow where

testimony related to the value of the business). Although the County argues that the

evidence was speculative, J. K. Cleaners’ appraiser based his testimony on

contractual obligations existing at the time of the taking, and factual questions

remained for the jury as to whether the dry cleaner made reasonable efforts to

mitigate or minimize these obligations. See Davis Co. v. DOT, 262 Ga. App. 138, 143

(3) (584 SE2d 705) (2003) (extent to which condemnee mitigated his business losses

was question for the jury). Moreover, we find no merit in the County’s claim that

introduction of the post-taking lease liability resulted in a double recovery here. It is

true that J. K. Cleaners’ appraiser considered the company’s business expenses –

including its lease payment – when placing a pre-taking value on the business.

Nothing indicates, however, that the appraiser factored the company’s future lease

requirement into the pre-taking valuation. We fail to see, therefore, how consideration

of the post-taking obligations created a double recovery.

      There is a “long-established policy of the Georgia appellate courts to be liberal

in allowing matters to be considered by the jury which might affect their collective

minds in determining the just and adequate compensation to be paid the condemnee.”

Evans v. DOT, 331 Ga. App. 313, 317 (1) (771 SE2d 20) (2015). And ultimately, “[i]t

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is within the sound discretion of the trial court to admit or deny admission of such

evidence [regarding business loss] when causation of such loss is in question.”

Arnold, supra at 18. Given the particular circumstances of this case, the trial court

properly exercised its discretion in admitting evidence of J. K. Cleaners’ post-taking

lease obligation. See Evans, supra at 315 (1) (“The grant or denial of a motion in

limine is reviewed only for an abuse of discretion.”). Accordingly, we affirm.

      Judgment affirmed. Ellington, P. J., and Rickman, J., concur.

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