Court Opinion

ID: 4185004
Source: CourtListenerOpinion
Date Created: 2017-07-10 22:07:55.384506+00
Date Added: 2024-06-11T14:39:38.313696
License: Public Domain

COLORADO COURT OF APPEALS                                           2017COA83

Court of Appeals No. 15CA1951
Weld County District Court No. 14CV30182
Honorable Julie C. Hoskins, Judge

Board of County Commissioners of the County of Weld, a political subdivision
of the State of Colorado,

Petitioner-Appellee,

v.

DPG Farms, LLC,

Respondent-Appellant.

                       JUDGMENT AND ORDER AFFIRMED

                                   Division II
                          Opinion by JUDGE HARRIS
                        Dailey and Márquez*, JJ., concur

                           Announced June 15, 2017

Bruce Barker, County Attorney, Bob Choate, Assistant County Attorney,
Greeley, Colorado; Hamre, Rodriguez, Ostrander & Dingess, P.C., Donald M.
Ostrander, Joel M. Spector, Denver, Colorado, for Petitioner-Appellee

Robinson Waters & O’Dorisio, P.C., Richard D. Judd, Brian A. Magoon, Jena R.
Akin, Denver, Colorado, for Respondent-Appellant

*Sitting by assignment of the Chief Justice under provisions of Colo. Const. art.
VI, § 5(3), and § 24-51-1105, C.R.S. 2016.
¶1    In this condemnation action, respondent, DPG Farms, LLC

 (DPG), appeals from a judgment entered on a jury verdict after a

 valuation trial. The issue on appeal concerns the proper method for

 determining compensation when the condemned property, and

 portions of the remainder, are capable of producing income.

¶2    DPG argues that the district court erred in (1) determining as

 a matter of law that water storage was not the highest and best use

 of the property; (2) excluding its lost income evidence which, it says,

 was admissible under its income capitalization approach to valuing

 the affected property; and (3) denying a substantial portion of its

 request for costs. We affirm.

                            I.   Background

¶3    Petitioner, the Board of County Commissioners of Weld

 County (the County), filed a petition in condemnation to extend a

 public road over 19 acres1 of DPG’s 760-acre property (the

 Property). When condemnation proceedings were initiated, the

 1 The condemned property included 16.96 acres in fee, 2.04 acres in
 permanent easements, and 2 temporary construction easements.
 The nature of land interests conveyed to the County is not at issue
 in this case, and there is no dispute regarding the value of the
 easements.

                                    1
 Property was used primarily for agricultural and recreational

 purposes.

¶4    The parties stipulated to the County’s immediate possession of

 the nineteen acres and proceeded to a valuation trial.2 DPG’s

 valuation encompassed two steps: (1) determining the highest and

 best use of the Property; and (2) in light of that determination,

 calculating the fair market value of the condemned property as well

 as any diminution in fair market value to the residue.

¶5    According to DPG’s experts, the highest and best use of the

 Property was mixed: portions of the Property were most

 advantageous for continued agricultural and recreational use, while

 other portions had the potential for gravel mining and subsequent

 water storage.

¶6    Specifically, approximately 280 acres of the Property contained

 gravel deposits. DPG’s experts testified that those acres could be

 mined over a period of time and then repurposed for water storage.

 The evidence of the feasibility of mining and water storage was set

 forth in a detailed development plan (the mining plan). The mining

 2Before filing the petition, the County paid DPG $148,719, the
 amount the County estimated as just compensation for the
 nineteen acres.

                                    2
 plan split the 280 minable acres into four areas — referred to as

 “cells” — located in a horizontal line across the Property. The

 nineteen-acre strip condemned by the County ran through Cell C.

¶7    DPG’s method of valuation proceeded as follows: first, it used

 primarily a comparable sales approach to calculate the

 pre-condemnation fair market value of the Property. DPG’s

 appraiser relied on six similar properties (though only two had

 potential for mining and water storage) to arrive at a per-acre value

 of $11,500, or $8.74 million for the entire 760-acre Property. The

 gravel mining expert, who was not an appraiser but had substantial

 experience buying and selling properties with mining potential,

 used a similar approach. He testified that, at the time of the

 condemnation, taking into account the expenses and losses

 inherent in gravel mining, a willing buyer would have paid

 approximately $5,000 per non-income-producing (agricultural) acre,

 and $10,000 per income-producing (mining) acre, or a total of $5.2

 million for the Property. The County’s own appraiser ultimately

 endorsed the mining expert’s pre-condemnation, fair market value

 of the Property.

                                   3
¶8    Next, to calculate the loss in value to the Property caused by

 the condemnation, DPG switched to what it calls an income

 approach. But rather than calculating a post-condemnation fair

 market value of the Property (that could be compared with the

 pre-condemnation value, as calculated by the appraiser and mining

 expert), DPG used its mining plan to compute the total income that

 could have been generated from the nineteen-acre strip ($1 million),

 as well as from a twenty-seven-acre portion of Cell C affected by the

 condemnation ($2.1 million). It then attempted to present the $3.1

 million loss figure as its compensable damages.

¶9    The district court excluded only the ultimate loss figure,

 concluding that without any evidence of that figure’s connection to

 the Property’s fair market value, the figure amounted to

 inadmissible frustration-of-plan damages. In light of the court’s

 ruling, DPG presented an alternative damages figure: the appraiser,

 using his $11,500 per-acre fair market value figure, testified that

 the Property’s value decreased by $550,000 — the value of the

 approximately forty-six acres (plus the easements) that were either

 condemned or damaged by the condemnation.

                                   4
¶ 10   The jury awarded DPG $183,795 in damages for the

  condemned property3 and nothing for any damage to the residue.

¶ 11   DPG filed a post-trial motion to recover its costs, as permitted

  by statute. It sought $248,680.92, much of which was attributable

  to expert witness fees. The district court rejected a substantial

  portion of the requested costs on the grounds that the costs were

  disproportionate to DPG’s success and that certain expert evidence

  had been excluded. The court awarded costs in the amount of

  $68,808.96.

                     II.   DPG’s Contentions on Appeal

¶ 12   On appeal, DPG contends that the district court erred in

  rejecting water storage as the highest and best use of certain

  portions of the Property and in excluding its lost income evidence.

  DPG also argues that the court erred in disallowing a significant

  portion of its costs.

  3 The nineteen-acre condemned strip consisted of seven-and-a-half
  minable acres and eleven-and-a-half non-minable acres. The value
  of the easements was $14,500. DPG’s appraiser valued the
  condemned strip at $233,000 ($11,500 per acre X 19 acres +
  $14,500). DPG’s mining expert valued the strip at $147,000
  ($10,000 X 7.5 + $5000 X 11.5 + $14,500). The jury’s award of
  approximately $184,000 is close to the mid-point between the two
  numbers.

                                     5
                A.   Highest and Best Use of the Property

¶ 13   The measure of compensation in an eminent domain case

  turns on the value of the entire property as it exists at the time of

  the condemnation, “taking into consideration its highest and best

  future use.” Bd. of Cty. Comm’rs v. Vail Assocs., 171 Colo. 381,

  389, 468 P.2d 842, 846 (1970). Under this principle, the property’s

  value is based on the most advantageous use to which the property

  reasonably may be applied and is not limited to its current

  condition. Dep’t of Highways v. Schulhoff, 167 Colo. 72, 77-78, 445
P.2d 402, 405 (1968); see, e.g., State Dep’t of Highways v.

  Mahaffey, 697 P.2d 773, 775-76 (Colo. App. 1984) (highest and best

  use of property was gravel mining despite land currently being

  vacant and undeveloped). The four factors to be used in

  determining a property’s highest and best use are legal

  permissibility, physical possibility, financial feasibility, and

  maximal productivity. See Appraisal Institute, The Appraisal of

  Real Estate 280 (14th ed. 2013).

¶ 14   Although the admissibility of evidence regarding property

  value is “governed by an expansive, rather than restrictive, rule,”

  City of Englewood v. Denver Waste Transfer, 55 P.3d 191, 195 (Colo.

                                      6
Ohio App. 2002), a district court will not consider evidence of a property’s

  highest and best use that is overly speculative, Schulhoff, 167 Colo.

  at 75, 445 P.2d at 404.

¶ 15   Most of the Property’s 760 acres could only be used for

  agricultural or recreational purposes. The dispute between the

  parties centered on the highest and best use of 280 acres of the

  Property, comprising cells A, B, C, and D, which contained gravel

  deposits. The district court determined that the highest and best

  use of those acres was gravel mining, but not water storage as well.

¶ 16   The determination of a property’s highest and best use is

  generally a factual question for the jury unless the evidence of

  highest and best use is so improbable or speculative that it should

  be excluded from the jury as a matter of law. City of Quincy v.

  Diamond Constr. Co., 762 N.E.2d 710, 715 (Ill. App. Ct. 2002); cf.

  Bd. of Cty. Comm’rs v. Rodgers, 2015 CO 56, ¶¶ 13, 15-17

  (explaining that, after presentation of evidence, if the court finds

  that a reasonable jury would not have a legally sufficient evidentiary

  basis to find for the party on that issue, the court may resolve the

  issue against the party as a matter of law).

                                     7
¶ 17   After DPG’s experts testified about the Property’s highest and

  best use, the district court determined, as a matter of law, that the

  evidence was too speculative to support a finding that water storage

  was the highest and best use of Cell C.4 We review that legal

  conclusion de novo. See E-470 Pub. Highway Auth. v. 455 Co., 3
P.3d 18, 22 (Colo. 2000).

¶ 18   The district court’s determination was based on the following

  evidence:

           The construction of a slurry wall was integral to DPG’s

              water storage plan. (A slurry wall is a reinforced,

              concrete wall structure that lines a mining pit and

              provides a barrier for water storage.) According to DPG’s

              engineering expert, construction becomes more difficult

              and risky as the depth of the slurry wall increases. An

              irregular bottom and porous materials also make

              construction more difficult, and these elements were

              present in Cell C.

  4The highest and best use evidence submitted by DPG focused on
  Cell C.

                                     8
 The slurry wall would have to be built approximately 108

  feet deep, possibly 116 feet deep. DPG’s engineering

  expert testified that he thought a 108-foot wall was

  possible, but that the deepest slurry wall he had

  experience with was 55 feet deep.

 The usual installation cost for a slurry wall is $3 million

  to $5 million, but because of the bedrock depth, the

  nature of the soil and other underground materials, and

  the additional equipment necessary for construction, the

  cost of a slurry wall in Cell C was estimated at almost

  $14 million.

 Although DPG had an estimate for the cost of the slurry

  wall, the experts’ analysis was so preliminary that they

  did not know at the time of trial whether it was feasible to

  construct a slurry wall at all. For example, DPG’s

  experts had drilled four boreholes to determine the soil

  conditions in Cell C, but DPG would not know whether

  Cell C was suitable for a slurry wall until after its experts

  drilled an additional eighteen boreholes and analyzed the

  results. DPG’s engineering expert acknowledged that the

                          9
            outcome of any further investigation could change his

            opinions.

           DPG’s geologist acknowledged that the experts did not

            have sufficient information to determine whether water

            storage on Cell C would be a “good idea” even though it

            might be “possible.”

¶ 19   We conclude that the district court did not err in determining,

  as a matter of law, that the evidence was too speculative to support

  a jury finding that water storage was the highest and best use of

  Cell C. See Denver Waste Transfer, 55 P.3d at 197 (Valuation

  depends on the “reasonable” future use of the property, but “merely

  possible or imaginary uses or speculative schemes of its proprietor

  are to be excluded.”) (alteration omitted) (quoting Twin Lakes

  Hydraulic Gold Mining Syndicate, Ltd. v. Colo. Midland Ry., 16 Colo.
1, 5, 27 P. 258, 260 (1891)).

             B.   Exclusion of DPG’s Lost Income Evidence

¶ 20   The district court allowed DPG’s appraiser and mining expert

  to testify, consistent with DPG’s mining plan, that gravel mining of

                                   10
  Cell C would generate income.5 That evidence was admissible, the

  court ruled, because it was relevant to determining the Property’s

  fair market value. But when DPG attempted to introduce the lost

  income figures as the actual amount of compensation due, the

  court excluded that evidence. It reasoned that, on their own and

  unconnected to a fair market valuation of the Property, the lost

  income figures amounted to a request for damages based on the

  frustration of a hypothetical development plan, a type of

  compensation barred in eminent domain cases.

¶ 21   On appeal, DPG insists that evidence of lost income was

  admissible pursuant to an income capitalization approach to

  valuing the Property. We disagree.

          1.    Valuation Methods in Eminent Domain Cases

¶ 22   In an eminent domain case, the landowner is entitled to be

  reimbursed for both the value of the condemned property and the

  reduced value of the remaining property.

¶ 23   The amount of compensation owed for the condemned

  property is “measured by the actual fair market value of the

  5The mining plan contemplated gravel mining of cells A, B, and D,
  but did not include specific income figures for those cells.

                                   11
  property” at the time of the taking. Palizzi v. City of Brighton, 228
P.3d 957, 962 (Colo. 2010); see also Denver Waste Transfer, 55 P.3d

  at 195 (Just compensation is the “present reasonable market value”

  of the property in light of its “highest and best use.”). Fair market

  value is what a willing buyer would pay for the property if the owner

  had voluntarily offered it for sale. Palizzi, 228 P.3d at 962; see also

  CJI-Civ. 36:3 (2017) (“‘Reasonable market value’ means the fair,

  actual, cash market value of the property. It is the price the

  property could have been sold for on the open market under the

  usual and ordinary circumstances . . . .”).

¶ 24   Compensation for damage to the remainder of the property is

  measured by the difference in the fair market value of the residue

  immediately before and immediately after the taking. 4A Julius L.

  Sackman et al., Nichols on Eminent Domain § 14.02(3) (3d ed.

  2015; see also Wassenich v. City & Cty. of Denver, 67 Colo. 456,

  466-67, 186 P. 533, 537 (1919).

¶ 25   There are three general approaches to establishing the fair

  market value of real estate: the comparable sales approach, the

  income approach, and the cost approach. Mahaffey, 697 P.2d at

  775. Only the first two methods are relevant here.

                                    12
¶ 26   The comparable sales approach aims to identify sufficiently

  similar properties — in size, use or development, or location —to

  arrive at a reasonable estimate of the fair market value of the

  condemned property. See Goldstein v. Denver Urban Renewal Auth.,

  192 Colo. 422, 426, 560 P.2d 80, 84 (1977).

¶ 27   The income approach values the property based on projections

  of the “net income generated by the property during the remainder

  of its productive life.” Denver Urban Renewal Auth. v. Berglund-

  Cherne Co., 193 Colo. 562, 565-66, 568 P.2d 478, 480 (1977).

  Under this approach, an appraiser analyzes a property’s capacity to

  generate benefits, usually an income stream, and then, using

  various techniques and mathematical procedures, “convert[s] these

  benefits into an indication of present value.” Appraisal Institute at

  445. “Overall, the income approach converts the income that the

  real estate is expected to generate into a factor that a reasonable

  buyer or seller would consider in determining fair market value.”

  W. Va. Dep’t of Transp. v. W. Pocahontas Props., L.P., 777 S.E.2d
619, 639 (W. Va. 2015).

¶ 28   The goal of both methods is to determine just compensation

  based on the impact of the condemnation on the present,

                                    13
  reasonable market value of the property. Jagow v. E-470 Pub.

  Highway Auth., 49 P.3d 1151, 1157 (Colo. 2002); see also Appraisal

  Institute at 439. And, if performed correctly, the comparable sales

  and income approach calculations should result in similar fair

  market valuations for the same property, providing further

  assurances to the appraiser that the final value opinion is reliable.

  Appraisal Institute at 439. Utilizing more than one valuation

  approach may therefore be preferable because the approaches can

  then be used “simultaneously as cross-checks upon one another,”

  which can be particularly important for complex, mineral-bearing

  land appraisals. W. Pocahontas Props., 777 S.E.2d at 635-36

  (quoting W. Va. Dep’t of Highways v. Sickles, 242 S.E.2d 567, 569

  (W. Va. 1978)).

¶ 29   In contrast to damages based on the fair market value of the

  property, losses suffered from the frustration of the landowner’s

  special plan for the property are not compensable. See 4A Nichols

  on Eminent Domain at § 14.02(5). The prohibition on frustration-

  of-plan damages is based on the idea that an anticipated

  development plan cannot be viewed as an “accomplished fact,”

  because such an approach ignores the substantial but unknown

                                    14
  costs involved in implementing the plan. See Schulhoff, 167 Colo.

  at 77, 445 P.2d at 405.

¶ 30   The line between evidence of a hypothetical development plan,

  the frustration of which is not compensable in damages, and

  evidence of potential income generation, the admission of which is

  relevant to an income approach, is not always easy to draw. In

  general, an owner cannot recover damages suffered by reason of

  being prevented from carrying out a particular scheme of

  improvement that exists only in contemplation at the time of trial.

  “However, under certain circumstances, evidence that a proposed

  use would result in a profit is admissible not for the purpose of

  enhancing the damages by showing the loss to the owner of a

  particular plan of operation, but to show that such proposed plan is

  a feasible plan and should be considered in fixing market value.”

  4A Nichols on Eminent Domain at § 14.02(5). Thus, the

  hypothetical plan is only relevant to establish “the price on which a

  willing buyer and a willing seller would agree for the property in its

  present condition.” Bd. of Assessment Appeals v. Colo. Arlberg Club,

  762 P.2d 146, 154 (Colo. 1988).

                                    15
       2.     DPG’s Evidence of Lost Income Was Not Admissible as the
                              Measure of its Damages

¶ 31        DPG says that the court erred in excluding its evidence of lost

  income as damages from frustration of a hypothetical plan. It

  contends that its evidence of lost income was admissible under its

  income capitalization approach.

¶ 32        The County argues that DPG failed to characterize its

  methodology at trial as an income approach and should not be

  permitted to switch gears on appeal. In any case, the County says,

  even if DPG purported to use an income approach at trial, the lost

  income evidence was nonetheless inadmissible because lost income

  itself is not the proper measure of damages in an eminent domain

  case.

¶ 33        We agree with the County’s second contention and, therefore,

  need not resolve its first, except to note that DPG’s appraiser

  testified that he used an income approach in part, and that the

  County’s attorney objected at various points during the trial to

  DPG’s reliance on a flawed income approach.

¶ 34        We review the district court’s ruling to exclude DPG’s lost

  income evidence for an abuse of discretion. See Bly v. Story, 241

                                        16
P.3d 529, 535 (Colo. 2010). An abuse of discretion occurs where

  the trial court’s ruling was manifestly arbitrary, unreasonable, or

  unfair, or was based on a misunderstanding or misapplication of

  the law. See Jackson v. Unocal Corp., 262 P.3d 874, 880 (Colo.

  2011); People v. Lopez, 2016 COA 179, ¶ 43. Whether the court

  misapplied the law in making evidentiary rulings is reviewed de

  novo. 455 Co., 3 P.3d at 22-23.

¶ 35   As we have explained, just compensation in an eminent

  domain case is measured by the fair market value of the

  condemned property at the time of the taking and, with respect to

  damage to the residue, by the difference in fair market value of the

  residue before and after the condemnation. Palizzi, 228 P.3d at

  962; 4A Nichols on Eminent Domain at § 14.02(3).

                a.    Valuation of the Condemned Strip

¶ 36   DPG presented evidence of the fair market value of the

  condemned strip: its appraiser testified that each of the nineteen

  acres was worth $11,500; its mining expert testified that each of the

  gravel-producing acres was worth $10,000, and each non-income-

  producing acre was worth $5,000.

                                    17
¶ 37   But DPG did not seek compensation based on its evidence of

  fair market value. Instead, it calculated the total amount of income

  that might have been generated from the condemned property over

  ten years, applied a capitalization rate to arrive at a present value

  for the lost income, and then sought reimbursement for the

  prospective income.

¶ 38   The nineteen-acre strip, which contained seven-and-a-half

  minable acres and eleven-and-a-half agricultural acres had a fair

  market value, according to DPG’s own experts, of somewhere

  between $132,500 (per the mining expert) and $218,500 (per the

  appraiser) (not including the $14,500 for the easements). But DPG

  sought damages of approximately $1 million based on lost income.6

¶ 39   An “income approach” to valuation is not an exercise whereby

  an expert simply computes prospective income from the property

  and then requests reimbursement in that amount. An income

  approach uses potential income from the property, along with all

  other factors that would be considered by a buyer, as evidence of

  6 The results of the income approach should have aligned with the
  results of the experts’ comparable sales approach. But here, the
  nineteen-acre strip was 2.5% of the Property but represented about
  15% of the Property’s total value.

                                    18
  the fair market value of the property in its current condition. The

  principles underlying an income approach to valuation reflect the

  distinction “between income as a criterion of value and income as

  evidence of value.” 5 Nichols on Eminent Domain at § 19.01. Net

  income alone is not “controlling on the issue of value”; it is merely

  one factor to be considered by the jury in conjunction with all other

  material evidence of fair market value. Id.; see also De Freitas v.

  Town of Suisun, 149 P. 553, 555 (Cal. 1915) (“The actual market

  value is the thing to be determined, and while net revenue should

  be considered, it does not, in general, furnish a conclusive measure

  of such market value.”); W. Pocahontas Props., 777 S.E.2d at 634

  (The future earning power of real estate is “a powerful tool for

  calculating a fair market valuation of the real estate.”).

¶ 40   Thus, DPG’s evidence of a potential income stream was

  admissible not as the measure of its damages but rather, as the

  district court made clear in its order on the motions in limine, as a

  factor that could inform the fair market value of the Property. See

  Mahaffey, 697 P.2d at 775 (using income approach, appraiser

  considered other expert opinions regarding potential income stream

  from gravel mining and arrived at a fair market value of the entire

                                     19
  property). And indeed, both the appraiser and the mining expert

  testified that the potential income stream from mining did inform

  their fair market valuations. Though the experts primarily used a

  comparable sales approach, the comparable sales were of properties

  that had the potential to generate income.

¶ 41   DPG may believe, in hindsight, that the fair market valuations

  by its experts did not take adequate account of the Property’s

  potential income. But DPG was not entitled to present its lost

  income figures to the jury as an alternative to fair market value.

  The income approach is an alternative to the comparable sales

  approach, but neither method is an alternative to fair market

  valuation — as we have noted, both approaches simply use different

  techniques for arriving at the fair market value of the property. See

  Jagow, 49 P.3d at 1157.

                b.   Valuation of Damage to the Residue

¶ 42   The same methodological flaws plagued DPG’s valuation of the

  damage to the residue. DPG’s theory was that the new road, which

  bisected Cell C, rendered approximately twenty-one acres of Cell C

  unsuitable for mining. In its most simplified form, the mining

  expert’s testimony established that the condemnation resulted in a

                                    20
  decrease in mining profits from Cell C in the amount of $2.1 million

  (in present value).

¶ 43   There are two problems with DPG’s residue valuation method.

  First, compensation for damage to the residue is measured by the

  difference in fair market value of the entire residue immediately

  before and after the condemnation. See Mack v. Bd. of Cty.

  Comm’rs, 152 Colo. 300, 381 P.2d 987 (1963) (determination of

  residue damages based upon diminution in value of the entire

  residue). So it was improper for DPG to attempt to show a

  diminution in value of the 113 acres in Cell C only, when it retained

  an additional 627 acres of residue. See 4A Nichols on Eminent

  Domain at § 14.02(3)(a) (“[T]he landowner is entitled to receive, in

  addition to the value of the part taken, separate severance damages

  in order to be fully compensated for the diminution in value of the

  property with which the landowner is left.”) (emphasis added); see

  also City of Jacksonville v. Nixon, 442 S.W.3d 906, 910 (Ark. Ct.

  App. 2014) (“In partial-takings cases, the landowner is entitled to

  the value of the lands taken, plus damages to the lands not taken.”)

  (emphasis added).

                                    21
¶ 44   Second, the measure of damages still turns on fair market

  value. DPG’s experts had to answer three questions: What was the

  fair market value of the entire residue immediately before the

  taking? What was the fair market value of the entire residue

  immediately after? And what was the difference? See W.

  Pocahontas Props., 777 S.E.2d at 645. That 280 acres of the

  residue contained gravel deposits could have factored into the

  answer to those questions. But DPG could not ignore the questions

  altogether and simply request reimbursement for its $2.1 million in

  lost income from Cell C. Lost income is not a valid substitute for

  fair market value, whether the land at issue is the condemned

  property or the residue.

¶ 45   As we have noted, DPG offered evidence of the Property’s fair

  market value. Based on this admissible evidence, the jury

  determined that the nineteen-acre condemned strip had a fair

  market value of $183,795.

¶ 46   As for the diminution in value of the residue, DPG presented

  evidence that twenty-one acres of Cell C, which had been suitable

  for mining, was rendered non-income-producing as a result of the

  condemnation. Based on the mining expert’s testimony, the jury

                                   22
  could have determined that the twenty-one acres decreased in value

  from $10,000 per acre to $5,000 per acre, a diminution in value of

  $105,000. But the appraiser, who was offered as the expert in

  valuation, testified that each acre, regardless of its income

  potential, was worth about $11,500. If the jury credited the

  appraiser’s testimony, it could have reasonably concluded that each

  of the twenty-one acres was worth $11,500 both before and after

  the condemnation, resulting in no diminution in value to the

  residue. The jury apparently credited the appraiser. DPG does not

  challenge the verdict as inconsistent with the valuation evidence

  admitted at trial.

       c.   The Flawed Valuation Evidence Was Properly Excluded

¶ 47    We discern no error in the district court’s exclusion of DPG’s

  lost income figures. In the order on the motions in limine, the court

  explained that DPG’s evidence was admissible to show the effect

  that the mining income “would have on the property’s current fair

  market price.” DPG, though, sought to present the evidence of lost

  income as its actual measure of damages, separate from (and

  irreconcilable with) the fair market valuation evidence presented by

  its experts. Because the lost income evidence, on its own, did not

                                    23
  reflect the proper measure of damages, the district court correctly

  excluded it. See, e.g., City of Aurora ex rel. Util. Enter. v. Colo. State

  Eng’r, 105 P.3d 595 (Colo. 2005), (expert evidence properly excluded

  where expert’s methodology was flawed); see also Williams v. State,

  406 S.W.3d 273, 283 (Tex. App. 2013) (appraiser’s testimony is

  unreliable and therefore inadmissible if the appraiser violated well-

  established rules of valuation).

¶ 48   To the district court, the lost income evidence, untethered to a

  fair market valuation, amounted to inadmissible frustration-of-plan

  damages. We need not decide whether we, too, would characterize

  the inadmissible evidence in the same way as the district court. It

  is enough to say that the district court was right to exclude the lost

  income evidence under these circumstances. See People v. Phillips,

  2012 COA 176, ¶ 63 (appellate court may affirm trial court’s

  evidentiary ruling on any ground supported by the record).

                        C.    Order on DPG’s Costs

¶ 49   The district court declined to reimburse DPG for most of its

  expert witness fees, finding that DPG’s costs were disproportionate

  to the judgment and that it was not entitled to reimbursement for

  expert testimony that was ultimately excluded. We review an award

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  of costs for an abuse of discretion. First Citizens Bank & Tr. Co. v.

  Stewart Title Guar. Co., 2014 COA 1, ¶ 50. Therefore, we will only

  disturb the award if it is manifestly arbitrary, unreasonable, or

  unfair. Id. Because we conclude that the income valuation

  evidence presented by DPG’s experts was properly excluded, we

  cannot conclude that the district court abused its discretion in

  limiting DPG’s award of costs on this basis.

                            III.   Conclusion

¶ 50   The judgment and cost order are affirmed.

       JUDGE DAILEY and JUDGE MÁRQUEZ concur.

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