In temporary construction easement, condemnor liable for damages flowing from use of easement, not injury to business.

Author:Blair, Benjamin A.
Position:Recent Court Decisions on Real Estate and Valuation - Department of Transportation v. Jay Butmataji, LLC

Jay Butmataji LLC (Landowner) owned a 3.573acre property on which it operated a motel located along a highway. The state Department of Transportation (DOT) sought to widen the highway, and needed to appropriate 0.184-acres of Landowner's property as a temporary construction easement. DOT instituted a condemnation action for the temporary easement, and Landowner requested a jury trial to determine just compensation for the taking.

Landowner contended that ingress and egress to the motel was limited by the temporary construction easement during construction of the road. Landowner's appraiser based his valuation on the assumption that the actual physical access to the motel was cut off or could be cut off at any time during the five-year construction project. He also used the loss of income from the rental of rooms during the period of the temporary construction easement as a portion of his opinion of damages.

Before the trial, DOT made a motion in limine, requesting that the trial court instruct all parties, counsel, and witnesses not to mention certain information in the presence of the jury. Specifically, DOT argued that Landowner's appraiser should not be permitted to testify regarding the portion of his appraisal dedicated to the business income lost during the period of the temporary easement, and that those pages from his appraisal should be excluded. The trial court granted the motion in limine, and the jury ultimately determined damages of $ 150,000. Landowner appealed the judgment on the premise that its appraiser should have been permitted to testify regarding the income that would be lost to the motel business because of the temporary construction easement.

On appeal, the state court of appeals first clarified that Landowner's appraiser was not excluded as a witness. Indeed, there was no question as to his qualifications and no question that he used recognized methodologies in valuing the property generally. But even expert testimony may be limited by the rules of evidence and the law applicable to the subject of the testimony. In condemnation cases, for example, the trial court must consider whether the appraiser's opinion is based upon the correct factual basis or any element of damages not considered proper for that type of case.

The court of appeals found that Landowner conflated the measure of damages for a permanent partial taking with the damages for a temporary construction easement. For a permanent partial taking, just...

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