Court Opinion

ID: 5138594
Source: CourtListenerOpinion
Date Created: 2021-12-21 15:11:09.749941+00
Date Added: 2024-06-11T08:24:09.831388
License: Public Domain

2018 UT App 213

               THE UTAH COURT OF APPEALS

           UTAH DEPARTMENT OF TRANSPORTATION,
                          Appellant,
                             v.
   LEJ INVESTMENTS LLC, ROBERT BOWMAN CONSULTING LLC,
        CRAIG JENSEN, RICHARD JENSEN, CAROL BOWMAN,
                    AND ROBERT BOWMAN,
                          Appellees.

                             Opinion
                         No. 20160648-CA
                     Filed November 8, 2018

           Third District Court, Salt Lake Department
             The Honorable Todd M. Shaughnessy
                          No. 110902201

          Sean D. Reyes, Barbara E. Ochoa, William H.
       Christensen, David M. Quealy, and Brent A. Burnett,
                     Attorneys for Appellant
        Jonathan O. Hafen, Justin P. Matkin, and Jeffery A.
                  Balls, Attorneys for Appellees

JUDGE DAVID N. MORTENSEN authored this Opinion, in which JUDGES
    GREGORY K. ORME and MICHELE M. CHRISTIANSEN FORSTER
                         concurred.

MORTENSEN, Judge:

¶1     In this condemnation action, the Utah Department of
Transportation (UDOT) attempted to convince the trial court
that a piece of property was nearly worthless dirt. The trial court
thought more of the property, and UDOT appeals. We affirm.
                    UDOT v. LEJ Investments

                        BACKGROUND

¶2    UDOT filed a condemnation action to acquire a strip of
land that crossed property owned by LEJ Investments LLC,
Robert Bowman Consulting LLC, Craig Jensen, Richard Jensen,
Carol Bowman, and Robert Bowman (collectively, LEJ). UDOT
sought to obtain the land to construct a new freeway, the
Mountain View Corridor (the MVC), on the west side of Salt
Lake County. When the parties could not agree on the fair
market value of the property, UDOT served LEJ with a
complaint, establishing the date on which the trial court was to
base its determinations of fair market value and severance
damages.

¶3      At trial, UDOT and LEJ presented differing appraisal
values for the property. UDOT depicted the property as “a
353-acre vacant dry farm” with “no streets accessing the interior
of the property” and with “antelope still roam[ing] the area.”
LEJ depicted the property as a budding real-estate investment
with immediate potential for mixed-use development. During
trial, the mayor of West Jordan City (the City) testified that the
mixed-use development plans were consistent with the City’s
plans for the area, even without the MVC. A real estate
developer also testified that there was sufficient demand as of
the valuation date to develop the LEJ property for mixed use,
even in the absence of the MVC.

¶4     The trial court reviewed appraisals from each party and
ultimately rejected both valuations. The court concluded,
“Neither side offered a backup or alternative valuation for the
court to look to for guidance, opting instead to go for broke with
the value conclusions each had in hand. Under these
circumstances, the court has no choice but to construct its own
before-condition valuation, as best it can under the
circumstances, and with all the limitations presented.” The court

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                    UDOT v. LEJ Investments

ultimately awarded LEJ approximately $13 million in just
compensation for the property.

¶5      After the trial court entered a final judgment, UDOT
learned that LEJ had not supplemented its discovery responses
prior to trial with information regarding actual development
proposals for portions of the LEJ property. UDOT moved for a
new trial, asking the court to compel production of documents
and reopen discovery. The trial court granted the motion in part,
requiring LEJ to supplement its discovery responses with
unproduced documents and scheduling an additional day of
trial. The trial court denied UDOT’s request to conduct
additional discovery and quashed the subpoenas UDOT’s
counsel had issued to consultants whom LEJ engaged in an
effort to gain municipal development approvals during the time
leading up to trial. After receiving additional evidence during
the added day of trial, the trial court declined to amend its prior
ruling.

¶6    UDOT appeals.

            ISSUES AND STANDARDS OF REVIEW

¶7     UDOT raises various challenges to the trial court’s final
order. Where UDOT challenges the court’s application of the
law, we review such conclusions for correctness. See
AmericanWest Bank v. Kellin, 2015 UT App 300, ¶ 11, 364 P.3d
1055. Where UDOT’s arguments challenge the court’s factual
findings, we review for clear error. Id. Finally, we review the
court’s decision to partially reopen trial and discovery for an
abuse of discretion. See Sunridge Dev. Corp. v. RB & G Eng'g, Inc.,
2013 UT App 146, ¶ 3, 305 P.3d 171; Clissold v. Clissold, 519 P.2d
241, 242 (Utah 1974), overruled on other grounds by St. Pierre v.
Edmonds, 645 P.2d 615 (Utah 1982).

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                    UDOT v. LEJ Investments

                           ANALYSIS

¶8     UDOT contends that the trial court erred in four ways.
First, UDOT argues that the trial court misapplied the
project-influence rule by relying on developments and
comparable properties that existed after the MVC project began.
Second, UDOT argues that the trial court’s conclusions
regarding the after-condemnation value of the property and
severance damages were clearly erroneous, legally incorrect, and
internally inconsistent. Third, UDOT argues that the trial court
did not hold LEJ to the appropriate burden of proof when it
rejected LEJ’s expert’s appraisal but proceeded to complete a fair
market evaluation. Fourth, UDOT argues that the trial court
erred in refusing to allow UDOT to conduct additional discovery
when it partially granted UDOT’s motion for a new trial. We
analyze these arguments in turn.

                  I. The Project-Influence Rule

¶9     We first examine UDOT’s argument that the trial court
misapplied the project-influence rule because it did not exclude
increases to the value of LEJ’s property attributable to the
construction of the MVC. UDOT specifically argues that (1) the
court should have excluded value increases resulting from
development patterns that occurred after the MVC was
announced, (2) the court’s highest and best use conclusion
wrongly incorporated the influence of the MVC, and (3) the
court erroneously relied on comparable properties, influenced
by the MVC, that did not exist on the valuation date. Because
evidence was presented at trial showing that the development
the court considered would have happened regardless of the
construction of the MVC, we conclude that the court did not
misapply the project-influence rule.

¶10 In a condemnation proceeding, the factfinder must
determine the fair market value of the condemned property. See

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                    UDOT v. LEJ Investments

Utah Code Ann. § 78B-6-511(1) (LexisNexis Supp. 2018); Thorsen
v. Johnson, 745 P.2d 1243, 1246 (Utah 1987). 1 Our courts have
developed a rule, referred to as the project-influence rule in
these proceedings, to ensure that “any enhancement or decrease
in value attributable to the purpose for which the property is
being condemned shall be excluded in determining the fair
market value of the property.” Redevelopment Agency of Salt Lake
City v. Grutter, 734 P.2d 434, 437 (Utah 1986).

¶11 UDOT concedes that the trial court recognized the
project-influence rule while making its ruling. Indeed, the trial
court articulated its task well when it stated,

      [T]he court must construct a hypothetical world as
      of February 1, 2011, in which it assumes the MVC
      Project never existed. To do that, the court must
      reach back even further, to 2003, assume the project
      never existed, and then project forward what [the]
      real estate development world would have looked
      like in the relevant market during the period from
      2003 to 2011 had the MVC Project never existed.

However, UDOT argues that the trial court failed to apply the
rule properly. We disagree.

¶12 Ample evidence existed on the record for the trial court to
conclude that the area would have been developed even without
the MVC project. For example, the trial court found, and UDOT
does not challenge the finding, that UDOT’s expert arrived at his
valuation conclusion by looking only to the City’s general plan
for the year 2003—before the MVC was announced. What that

1. Because the statutory provisions in effect at the relevant time
do not differ in any material way from those now in effect, we
cite the current version of the Utah Code for convenience.

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                    UDOT v. LEJ Investments

assessment ignores is the development that would have
occurred in the absence of the MVC project’s influence between
2003 and the valuation date for the LEJ property in 2011. But it
was the trial court’s duty to predict what development would
likely have occurred and, by comparison, what the value of the
LEJ property would likely have been had the MVC never been
announced.

¶13 The trial court justifiably relied on two pieces of
compelling evidence showing that the development of the area
surrounding the LEJ property would have happened regardless
of the MVC. First, the City’s mayor testified that LEJ’s plans for
commercial and residential development were consistent with
the City’s plans for the area with or without the MVC. A year or
two before the lawsuit, LEJ began working with the City to
create a plan for mixed-use development. The mayor testified
that those plans were consistent with the City’s plans. The
mayor highlighted her desire to encourage mixed-use
development in the area and specifically testified that none of
these plans were contingent on the construction of the MVC.

¶14 Second, the trial court heard testimony from “a well-
known and well respected local real estate developer familiar
with development properties along the western portion of the
Salt Lake Valley.” The developer testified that there was
sufficient market demand as of the valuation date, even in the
absence of the MVC, to make the uses proposed in LEJ’s plan 2
financially feasible.

¶15 It was within the trial court’s discretion to find the
mayor’s testimony and the real estate developer’s testimony
credible. Under that framework, the court could rely on

2. LEJ’s proposed uses include residential housing at various
densities, commercial development, and an office park.

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                    UDOT v. LEJ Investments

development patterns that occurred or comparable properties
that were built after the MVC was announced because those
developments would likely have happened anyway. Thus, the
trial court did not error (1) when it relied on increases resulting
from development patterns that occurred after the MVC was
announced, (2) in its highest and best use conclusion, and (3) in
its reliance on comparable properties built in the shadow of
MVC. We perceive no error in the trial court’s application of the
project-influence rule.

                     II. Severance Damages

¶16 Next, UDOT argues that the trial court’s calculation of
severance damages was “clearly erroneous, legally incorrect, and
internally inconsistent.” We conclude that UDOT invited any
alleged error of which it now complains.

¶17 In a takings action where the property condemned
constitutes only a part of the property, a court also determines
damages to the part of the property not actually taken. See Utah
Code Ann. § 78B-6-511(1)(b) (LexisNexis Supp. 2018). “The
cardinal and well-recognized rule as to the measure of damages
to property not actually taken but affected by condemnation is
the difference in market value of the property before and after
the taking.” Salt Lake County Cottonwood Sanitary Dist. v. Toone,
357 P.2d 486, 488 (Utah 1960).

¶18 In its effort to determine the value of the property and to
establish severance damages, the trial court stated that neither
side’s appraisals and conclusions were reliable, but the trial
court nevertheless employed the “material and testimony from
two appraisals” to arrive at its conclusion. During trial, UDOT
endorsed this approach:

      Your Honor, as the fact finder you are allowed to
      decide the case based on what you think the most

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                    UDOT v. LEJ Investments

      reasonable value of the property is, weigh all of the
      evidence from both appraisers and decide a value,
      but it’s not an either/or question. It’s somewhere in
      the middle. . . . [Y]ou could pick some portions
      from one appraiser’s conclusions, you could pick
      some conclusions from another appraiser’s
      opinions. . . . You are allowed to arrive at a range
      in between what the experts say based on the
      evidence . . . .

UDOT now argues on appeal that the trial court’s ruling on
severance damages was erroneous because the court “did not
explain how [the experts’] value conclusion[s], rejected as
unreliable, could nonetheless support a range of values for its
severance damage conclusion.” UDOT essentially argues that
because the trial court did not adopt either expert’s appraisal, it
could not rely on either expert’s appraisal.

¶19 Although the trial court failed to provide a detailed
calculus explaining how it arrived at its adjustment value, it
explained why it could not provide such a mathematically
precise calculus. The court noted that “the appraisal experts . . .
make much more sweeping percentage adjustments to
comparable sales with little to no explanation.” UDOT does not
argue any facts upon which the court should have relied or
explain what the trial court should have done with the evidence
that was presented to it to avoid error. Under these
circumstances, we are inclined to conclude that the trial court
did not err. Cf. Utah Dep’t of Transp. v. Target Corp., 2018 UT App
24, ¶ 40, 414 P.3d 1080 (concluding that claimants in a
condemnation action were not required to “present their
severance damages on a line-item basis” but could “present their
severance damages evidence in a more general way”) cert.
granted, 425 P.3d 800 (Utah 2018); see also Macris v. Sevea Int’l,
Inc., 2013 UT App 176, ¶ 35, 307 P.3d 625 (“Although damages
may not be determined by speculation or guesswork, evidence

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                     UDOT v. LEJ Investments

allowing a just and reasonable estimate of the damages based on
relevant data is sufficient.” (cleaned up)).

¶20 Even assuming that the trial court erred, UDOT invited
the trial court to analyze the issue in the manner that it now
complains was erroneous. “Under the doctrine of invited error,
an error is invited when counsel encourages the trial court to
make an erroneous ruling.” State v. McNeil, 2016 UT 3, ¶ 17, 365
P.3d 699. Thus, a party cannot “intentionally mislead[] the trial
court so as to preserve a hidden ground for reversal on appeal.”
Id. (cleaned up). Here, UDOT invited the trial court to “arrive at
a range in between what the experts say based on the evidence.”
We therefore reject UDOT’s argument that the court erred in
doing exactly what UDOT urged it to do.

                 III. The Burden of Proof at Trial

¶21 UDOT next contends that the trial court failed to hold LEJ
to the correct burden to prove its damages when it did not adopt
LEJ’s expert’s opinion. UDOT argues that when the trial court
rejected LEJ’s expert’s conclusion, it should have ordered just
compensation in the amount that UDOT proffered or, in the
alternative, the trial court should have ordered a new trial. We
disagree and further conclude that UDOT invited any alleged
error.

¶22 UDOT correctly posits that “[t]he burden of showing the
damages which the owner will suffer rests on him.” Tanner v.
Provo Bench Canal & Irrigation Co., 121 P. 584, 589 (Utah 1911)
(cleaned up). But UDOT fails to apply this principle in its
argument correctly. “It is well settled that, although the plaintiff
has the burden of proving the fact, causation, and amount of
damages, he need only do so with reasonable certainty rather
than with absolute precision.” Macris v. Sevea Int’l, Inc., 2013 UT
App 176, ¶ 35, 307 P.3d 625 (cleaned up). Thus, LEJ’s burden was
not to prove damages with exact certainty, but to “produce a

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                      UDOT v. LEJ Investments

sufficient evidentiary basis to establish the fact of damages and
to permit the trier of fact to determine with reasonable certainty
the amount” of damages. Sawyers v. FMA Leasing Co., 722 P.2d
773, 774 (Utah 1986) (per curiam).

¶23 Here, while the trial court did not adopt either expert’s
appraisals, it also did not outright reject them. 3 The trial court
stated that it “agrees and disagrees with both parties’ experts.”
The fact that the trial court did not follow either expert to their
respective conclusions does not render the court unable to rely
on any portion of the experts’ testimony. See Tucker v. Tucker, 910
P.2d 1209, 1216 (Utah 1996) (“[T]he trial court, as trier of fact, [is]
entitled to weigh the evidence and reject all or part of any
witness’s testimony, even that of an expert.” (cleaned up)).

¶24 The trial court explained that LEJ’s expert “did a better
job of identifying the highest and best use of the property in the
before condition, but the mechanism he used to calculate LEJ’s
damages is not reliable and the result appears to overstate the
value of the property.” The court “likewise accept[ed] and
reject[ed] portions of the expert’s opinions of value in the after
condition,” where “UDOT’s experts seriously understate[d] the
access problems created by the alignment of the MVC.” We
conclude that LEJ presented evidence of its damages, at least
some of which the court found to be credible, and that LEJ
satisfied its burden to the extent that the trial court could rule on
LEJ’s damages stemming from the condemnation. See Utah Dep’t

3. The trial court acknowledged that while neither appraisal was
entirely reliable, the appraisals still informed the court’s
determination: “[A]s far as the value of the property in the
before condition, the court is left with the unenviable task of
trying to determine the fair market value of the property with
material and testimony from two appraisals, neither of which
correctly addressed the issue at hand.”

20160648-CA                      10                2018 UT App 213
                    UDOT v. LEJ Investments

of Transp. v. Jones, 694 P.2d 1031, 1033 (Utah 1984) (“In eminent
domain cases, absent a showing of passion and prejudice, if the
award of compensation was within the estimate of value given
by one of the expert witnesses, it is supported by competent
evidence and will be affirmed.”); State ex rel. Road Comm’n v.
Taggart, 430 P.2d 167, 169 (Utah 1967) (“The finding of the jury in
respect to severance or consequential damage was within the
range of the testimony upon that subject matter. We are of the
opinion that there is a reasonable basis in the evidence for the
finding of the jury in respect to damages and that the trial court
did not abuse its discretion in denying the defendant’s motion
for a new trial on that basis.”). 4

¶25 Second, we again note that UDOT encouraged the trial
court to rule based on the range of values presented by the
experts. Even if it were error for the court to make a ruling on
the range of values given, we would reject UDOT’s argument
under the invited error doctrine. See State v. McNeil, 2016 UT 3,
¶ 17, 365 P.3d 699.

        IV. The Denied Request for Additional Discovery

¶26 Finally, UDOT argues that the trial court abused its
discretion in refusing to allow additional discovery regarding
plans to develop the remainder of the property. UDOT has not
persuaded us that the court abused its discretion.

4. See also City of North Las Vegas v. 5th & Centennial, LLC, Nos.
58530, 59162, 2014 WL 1226443, at *4 (Nev. March 21, 2014)
(holding that, where “the district court rejected all expert
testimony relevant to damages and created its own arbitrary
methodology,” the court did not abuse its discretion where the
calculation of damages was within the range set by the experts
and based on the evidence it heard).

20160648-CA                    11               2018 UT App 213
                    UDOT v. LEJ Investments

¶27 A trial court does not abuse its discretion “if a reasonable
basis for its decision is apparent from the record.” Johnston v.
Labor Comm’n, 2013 UT App 179, ¶ 15, 307 P.3d 615. But UDOT
attempts to construe our holding in Sleepy Holdings LLC v.
Mountain West Title, 2016 UT App 62, 370 P.3d 963, to essentially
mean that any time a court rules that a party may not conduct a
deposition, that party is prejudiced. We do not follow UDOT to
this conclusion.

¶28 In Sleepy Holdings, we examined a trial court’s imposition
of discovery sanctions. Id. ¶ 9. There, we determined that
Mountain West was prejudiced by Sleepy Holdings’ late
supplementation because “had the deposition suggested
additional avenues of discovery, Mountain West would be at a
disadvantage in exploring them, as the discovery cutoff had by
that time passed.” Id. ¶ 27.

¶29 Here, we do not examine the trial court’s imposition of
discovery sanctions. Instead, we review the trial court’s partial
grant of UDOT’s motion for additional discovery and a new
trial. We are therefore unconvinced that our holding in Sleepy
Holdings, which deals specifically with discovery sanctions, binds
us to conclude that, when ruling on a motion to reopen discovery
and for a new trial, a trial court must completely reopen discovery
when potentially new evidence is discovered.

¶30 To the contrary, when a party moves for a new trial based
on newly discovered evidence, as UDOT did here, the party
must demonstrate that the evidence is “of sufficient substance
that with it there is a reasonable likelihood that there would
have been a different result.” In re L.M., 2003 UT App 75, ¶ 8, 68
P.3d 276 (cleaned up). UDOT has not explained why additional
discovery, beyond what the trial court allowed, was necessary.
UDOT’s only assertion of prejudice is its inability to “fully
develop[] the facts it needed to present its case.” It makes no
attempt to describe what those “needed” facts might be, or why

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                    UDOT v. LEJ Investments

they were needed. Given that the trial court partially granted the
motion, ordered the production of documents, and even heard
an additional day of testimony where new witnesses were
called, we are hard-pressed to conclude that the court abused its
discretion. Because UDOT “has not adequately explained why
additional discovery was needed,” we reject its argument.
Sunridge Dev. Corp. v. RB & G Eng’g, Inc., 2013 UT App 146, ¶ 9,
305 P.3d 171.

                         CONCLUSION

¶31 UDOT’s challenge to the trial court’s final order fails.
UDOT’s argument that the trial court misapplied the
project-influence rule fails because there was ample evidence on
the record that the improvements and development upon which
the court based its determination would have occurred even
without the MVC project. UDOT’s argument that the court erred
in calculating severance damages also fails because UDOT
invited any error of which it now complains. UDOT’s argument
that the trial court failed to apply the proper burden of proof is
without merit. LEJ presented enough evidence to carry its
burden, and any error the trial court may have made was invited
by UDOT. Finally, UDOT’s argument that the trial court abused
its discretion by not reopening discovery and not granting a new
trial fails because UDOT did not explain why additional
evidence was necessary.

¶32   Affirmed.

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