City of Milford v. Helen F. Maykut et al. (2010)

MEMORANDUM OF DECISION

This is an action involving a condemnation and taking by the plaintiff, City of Milford, against the defendants, Helen F. Maykut and Virginia Miller.   The subject property is a 6.15-acre parcel of undeveloped land in a one-acre minimum residential area in the city of Milford.   The portion taken by the City of Milford was a 0.17-acre part of that property abutting on Herbert Street.   The purpose of the taking was for the purported construction by the City of a pumping station.

BY WAY OF BACKGROUND

The City of Milford determined that the value of the portion of the subject premises which it took to be $15,000.00 and deposited that amount with the Clerk of the Court.   The defendants appealed from that award.   The matter was tried to this Court (Robinson, J.) and its decision, awarding the defendants $56,000 for the taking was appealed to the Appellate Court.   The City challenged the trial Court's reassessment of damages for the statutory taking, claiming that the Court improperly determined the highest and best use of the property.   The Appellate Court rendered its decisions on September 22, 2009.   In its opinion, the Appellate Court went into great detail discussing the issues raised before the trial court.   The trial court's decision was affirmed in part and overruled in part and the matter was remanded for further proceedings.   The Appellate Court specifically found that the trial court's finding that the highest and best use of the property was as a residential subdivision was not clearly erroneous.   For the reasons stated in its decision, however, it concluded that the trial court's more specific finding, that the highest and best use of the subject property was to subdivide it into four lots as indicated by a feasibility plan and that court's determination of the value of the proposed fourth lot were not supported by sufficient evidence, and its reassessment of damages was clearly erroneous.   The judgment was reversed only as to the award of damages and the case was remanded for a hearing in damages.

The parties appeared through counsel and offered evidence and testimony regarding the damages.   The Court reserved decision.

Having considered the evidence and testimony offered at trial and the applicable case law and statutes, the Court makes the following findings.

The Appellate Court determined that in the instant case the trial Court improperly reassessed the damages for the statutory taking by valuing the 6.15-acre properly using the lot method.   Our Courts have held that, “when the subject property is raw land-where there has been no improvements or preparation for subdivision-it may not be valued as if the land were in fact a subdivision.   Such land is to be considered in its present condition as a whole with consideration given to any increment or enhancement in value due to the property's present adaptability to subdivision development ․” Bristol v. Tilcon Minerals, Inc., 284 Conn. 55, 71 (2007).  (Emphasis in the original.)

“The better view is that a lot method appraisal can be admitted in appropriate cases if the proponent offers credible evidence of the costs of subdivision-e.g., the expense of clearing and improving the land, surveying and dividing it into lots, advertising and selling, holding it, and paying taxes and interest until all lots are sold ․ The potential value of land if subdivided could well be considered by a willing buyer and a willing seller where subdivision is a reasonable possibility and the costs of subdivision are not speculative or uncertain.”  Id. 74.

Upon review of the evidence and testimony at trial in the instant case, the Appellate Court held, “The lot method is most reliable in estimating value when substantial steps have been taken toward subdivision ․” The evidence and testimony permit the Court to find that substantial steps have not been taken and, consequently, the lot method is not applicable.   That Court went on to note that, “A modified version of the lot method of evaluation may also be used ․ the residual approach, an appraiser estimates a sales price for each individual, developed lot, multiplies that price by the number of lots in the tract, then deducts the estimated costs of development and marketing to arrive at a final estimate of the property's value.”  “Sufficient evidence of the costs associated with subdividing, preparing and marketing the land, however, must be provided to ensure the integrity and accuracy of the valuation process.”  Id. 73

In this case, the defendants have not offered such sufficient credible evidence of the cost of subdivision.   For that reason the Court cannot find a sufficient basis for evaluation of the subject premise under the lot method or under the residual approach.

At the time the instant case was heard on appeal, the Appellate Court found, “there is no record of ․ the expense of clearing and improving the land, surveying and dividing it into approved lots, advertising and selling it, holding it and paying taxes and interest until all lots are sold.   Without such evidence ․ the Court's determination of the value of the proposed fourth lot was not supported by sufficient evidence” and the matter was remanded for rehearing on damages.   Having considered the evidence and testimony offered during the instant trial, the Court finds that the defendants have still failed to provide the Court with the requisite evidence to support their claim of damages.

The Court notes the plaintiff's evidence offered by Virginia Miller as to the market value of the .17 acres taken by the City of Milford as of the date of taking in the amount of $15,000.00.   The Court also takes into consideration the subsequent finding by the Appellate Court that the highest and best use of the entire subject property is a residential subdivision.   The Court also has the benefit of the appraisal and testimony of Peter I. Zeidel that the market value of the entire parcel is $127,000.00.   Using those figures as parameters, the Court finds that the $15,000.00 valuation was done, in essence, in a vacuum, in that it did not project the overall diminution of the entire parcel, but rather treated the taking as a small portion of a larger property with no potential for increased value in consideration of its highest and best use.

As the Appellate Court has held in this case, “The trial court is not, as a matter of law, bound by the valuations or valuation methods used by the appraisers but [may] consider the comparable sales of land that [are] in evidence as well as the raw data utilized in the presentation of the lot method approach in independently determining fair market value.”

The Court finds that the amount of compensation for the taking by the City of Milford is $65,000.00.

BY THE COURT

JOSEPH W. DOHERTY, JUDGE

Doherty, Joseph W., J.