HomeMy WebLinkAboutLeeper ElectricHANCOCK CIRCUIT COURT
9 EAST MAIN STREET
3RD FLOOR, COURTHOUSE
GREENFIELD, IN 46140
HONIG, DAVID
SUITE 2000, BOX 82064
INDIANAPOLIS, IN 46282
C~E NO. 30C01-970~-CP-00076
LEEPEH ELECTRIC SERVICES iNC VS CITY OF CARMEL, ETAL
NOTICE.
FILE DATE
04/21/03
PLEASE TAKE NOTICE OF THE FOLLOWING ACTION OF THE COURT:
AMENDED COURT'S FINDINGS OF FACT, CONCLUSIONS OF LAW AND ENTRY AS TO PLAINTIFF'S MOTION TO
CORRECT ERRORS AND PLAINTIFF'S MOTION TO CORRECT JUDGMENT ENTRY ENTERED. AC
RICHARD D. CULVER
HANCOCK CIRCUIT COURT
CC:
TOSICK, MICHAEL J.
POSNES, MERV
CARTER, STEVE
MCNAMAR, DAVID FRED
S;~N'DERS, WILLIAM
MIEDEMA, LAWRENCE R.
MOLITOR, JOHN RAYMOWD
ELLIS, FRED
STEVENSON, HOWARD L.
STATE OF INDIANA )
) SS:
COUNTY OF HANCOCK )
IN THE HANCOCK CIRCUIT COURT
CAUSE NUMBER: 30C01-9703-CP-76
LEEPER ELECTRIC
SERVICES, CO. INC.
Plaintiff, ;
v.
CITY' OF CARMEE; '~t"~l.'"
Defendants.
AMENDED COURT'S FINDINGs OF FACT,' CONCLUSIONS OF LAW and ENTRY
AS TO PLAINTIFF'S MOTION TO CORRECT ERRORS and
PLAINTIFF'S MOTION TO CORRECT JUDGMENT ENTRY
The Plaintiff filed i~s Motion to Correct Errors stating that the verdict of. the' Jury was
inadequate and not within the "bounds of the evidence;" that the COurt erred in granting the
Defendants' Motion for a Judgment on the Evidence at the close of Plaintiff's case-in-chief; that the
Court erred in denying Plaintiff the oppormr~ty to have the Jury decide !f the Defendants violated
the Constitutional rights of the Plaintiff in their denying it any use of its property and taking Of
Plaintiff's property without just compensation; that the Court erred in denying Plaintiff the right to
amend its complaint to conform to the evidence presented during the trial; that the Court erred in
failing to fred that the moratoriums imposed by the Defendants upon Plaintiff's usage of its land
were contrary to law in that there is no authority for such moratoriums to be imposed; and that the
Court e[rcd._i.n n0t.a!!ow~ng cross examination of the City of Carmel's appraiser that he was hired.
by the Defendants. The Court having heard the evidence submit~cd du~'mg thc trial, hay!rig.
considered 'the Motion, the Defendants' response, the Plaintiff's reply, and the oral argument, now
finds that the Motion to Correct Errors should be GRANTED, in part, and DENIED in part.
The Court now finds the following:
1. The Jury verdict was not within the "bounds of the evidence" presented in Court. The
evidence in the record established the following:
a. Plaintiff is the owner of the land located on the north east comer of 131~ Street
and U.S. 31 in the City of Carmel, Hamilton County, Indiana.
b. Plaintiff attempted to rezone its property from S-2 (a residential classification) to
B-2 (a business classification) to accommodate an Indiana Lighting Center at that
location. The evidence also established that this property was within the U.S,31
corridor as defined in the Defendants' overall zoning plan and as such was to be
used for business purposes rather than residential purposes.
c. The Defendants refused the rezonLng and ultimately refused to allow the Plaintiff
any use of its property, including placing a hotel thereon, because they were trying
to influence the State to purchase it and use it for a future interchange if U.S. 31
were to become an interstate highway.
d. The evidence from four expert real estate appraisers established that the highest
and best use of the property was for commercial purposes and that could include the
use for a hotel.
e. ;i'he' Piain/iw~ rePresentative testified that the Plaintiff was to deve!op this
property as a hotel and that use was acceptable Without the need for any rezoning.
The Defendants had even granted a height variance to build the hotel, but then placed
a moratorium on the Plaintiff's property, denying any' use at all of the real estate. ·
f. The appraisers testified in their expert opinions the fair market value Of Plaintiff's
real estate as of November 2, 2000 (the .date of take established by the Court) ranged'
between $1,120,000.00 and $1,400,000.00. The Plaintiff's chief executive officer
testified in his opinion the fair market value on the date of take was $1,700,000.00.
g. There was no evidence presented by any witness that the fair market value of this
property on the date of take was any amount less than $1,120,000.00.
h. The Jury's verdict was $675,000.00. There was no evidence in the record to
support that number. Therefore the amount of the Jury's verdict was not within the
"bounds Of the evidence."
2. The Plaintiff had evidence that Michael Lady was hired by the City of Carmel to appraise
this property for the Defendants. The Defendants objected to any. evidence as to who hired
Mr. Lady and the Cour~ sustained the Defendants' objections. The Defendants failed to
present any authority that stich evidence ~hould be excluded. The Plaintiff, on the other
· hand~ submitted numerous authorities stating that:such evidence is proper, and a.court should
not exclude factors as' to who hired the witness and how much he was paid.
The Cou~t now also enters the following Conclusions of Law:
1. The Court may reverse a jury's award if it considered an improper element. Precision
Screen Machines, Inc. v. Hixson, 711 N.E.2d 176, 177 (Ind. Ct. App. 1994).
2, The jury verdict must be "within the bounds of the evidence" or the Court will set it aside.
3. The jury verdict must also be based upon competent evidence in the record. The Court
concludes that there are three accepted methods of evaluation of real estate in Indiana. These
2
three methods are (1) ~e cost approach, (2) the income approach, and (3) the market value
approach. Ohio Casualty Insurance Co. v. Ramsey, 439 N.E.2d 1162, 1167 (Ind.Ct. App.
1982). The mere inflation of the purchase price is inot an accepted method to establish fair
market value.
4. It was also error not to allow cross examination of Michael Lady as to who hired him to
appraise the property. Simon v. Clark, 660 N.E.2d 634 (Ind. Ct. App. 1996); Miller, Ind.
Evident, §616.103.
· 5. Pursuant to I.C. 32-24-1-11 Plaintiff is entitled to pre-judgment interest at the rate of 8%
per annum from November 2, 2002.
.6. Pursuant to I.C. 32-24-1-14 Plaintiffis entitled to litigatio{~ expenses in the sum of Two
.Thousand Five Hundred Dollars ($2,500.00).
. ITtS THEREFORE-ORDERED, ADJUDGED'AND DECREED that the Phinti~'s Motion
to C.0rrect Errors with respect to. the.aliegatioq.of the jury award not being within the boi~ds of the
evidence is GRANTED.
IT IS FURTHER ORDERED, ADJI~DGED AND DECREED,that the jury's award of
damages iS inadequate. Pursuant to Rule 59(.0(5) the Court enters Judgment on behalf of the Plaintiff
a~d against the City of Carmel in the sum of Qne Million Three Hundred Forty-three Thousand Four
Hundred Thirty-two Dollars ($1,343,432,00)1 This sum includes a judgment of One Million One
Hundred Twenty Thousand Dollars ($1,120,0(~0.00) plus pre-judgment interest and litigation expenses.
IT IS FURTHER ORDERED; ADJUDGED AND DECREED that the Court's error ia
failing to allow Plaintiff to cross-examine Micl~ael__ Lady on the topic of the payment of his fees is
rendered harmless by reason of the Court's entry of judgment.
IT IS FURTHER ORDERED, ADJ~GED AND DIgCREI~D that all other allegations'in the
Plaintiff's Motion to Correct Errors be, and ihl- same hereby are, DENIED.
SO oRDERED thi~ 21st day of April,
Ricl{ar~l D. Culver, Judge
"Hanc0~k Circuit Court
Copies to:
David F. MeNaniar
MCNAMAR & ASSOCIATES
111 Monument Circle, Suite 3350
P.O. Box 1883
Indianapolis. In. 46206-1883
Telephone: 317 632-3350
Michael I. Tosick'
Three Court House Plaza
P.O. Box 6
Greenfield, In. 46104
Telephone: 317 462-3445
David Honig
Hall, Render, Killian, Heath & Lyman, P.S.C.
One American Square, Suite 2000, Box 82064
Indianapolis, In. 46282
John R. Molitor
11711 N. Meridian St. Suite 200
Carmel, In. 46032
Douglas C. Haney
City of Carmel
One Civic Square
Carmel, In. 46032
Lawrence R. Miedema
Deputy Attorney General
IGCS 5~ Floor
402 W. Washington Street
Indianapolis, In. 46204
4
VOR PUBLICATION
ATTORNEYS FOR APPELLANT: ATTORNEY FOR APPELLEE:
ANGELA M. SMITH DAVID MeNAMAR
DAVID B. HONIG McNamar & Associates
HallRender Killian Indianapolis, Indiana
Heath & Lyman,.P.S.C.
Indianapolis, Indiana·
IN TIlE COURT OF APPEALS OF INDIANA
CITY OF CARMEL,
Appe~lant-Defend~h~,
NO; 30A01-0304-cv-i58
APPEAL FROM THE HANCOCK CIRCUIT COURT
The Honorable Richard D. Culver, Judge
Cause No. 30C01-9703~CP-00076
March 18, 2004
OPINION - FOR pUBLICATiON
KiRSCH~ Chief judg~ '
The'Ci{y 0fcatmel appeals th~ trial court's'decision to gl'ant Leeper Electric Serviges, Inc.'s (Leeper
ElectriC)' Motion to CorreCt Errors and Motion to Correct Judgment Entry. The City 0f carmel raises one
issue 6n app'eal, Wkicl5 xve restate as follows: whether the trial court abused i{s discretion when it g/anted
Lecpef Electric's Motion to COrrect Errors pursuant to Indiana Thai Rule 59(J)(5) and awarded
$1,12'0;000.in dSzha~es after finding that the jury's award of $675,000 in damages was not within the
b0unds:ofthe evidence. {eefoOmote
'W~.affim, S~foothote
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FACTS AND PROCEDURAL HISTORY
On November 3, 2000, Leeper Eleciric filed its Amended Complaint against the City of Carmel and
· .other defendants not parties to this appeal. In pertinent part, Leeper Electric alleged that an
approximately four-ac~e parcel of real estate located on the northeast comer of 131st Street and U.S. 31
in Carmel, Hzfmilton County, Indiana was rendered valueless as a result of the City of Carmel's
implementation of a domprehenSive development plan and denial of Leepe~ Electric's application for
rezoning of the property. Leeper Electric further alleged that the City of Carmel's actions effectively
deprived it of any legitimate.uSe of the subject real estate and, thus, 'constituted a "taking"
by the. City of Canne! without just compensation in violation of the United States and Indiana
constitutions:
On May 16, 2001, the trial court determined that the matter effected a "taking" ofL6eper Electric's real
estate and .ordered the matter to proceed as an inverse condemnation and eminent domain action.
Thereafter, the trial court appointed three appraisers to evaluate Leeper Electric's real estate in order to
'determine the fair market value of the property as of November 3, 2000, the date of the taking.
In NoVember of2002~ a jury trial was held. Evidence was introduced that Leep~r i~lectric purchased
~e real estate in 1996 for $100,000. The property previously had been owned by Earlham College,
~hich had'tried tb sell:the:parcel for several years without success. Leeper Electric offered into evidence
the testimony of foui' appraiSerS and the t6stimony of Mr. Robert Leeper; the company's owner,
c6fidemihg their op~onS'a~ to the fair market value of the property. The appraisers testified to opinions
6f value.rafiging from.$1 ~120,000'to $1,400,000. Leeper testified that in his opinion the property was
worth $t.,.700,000..Dh.November 22, 2002, the jury aWarded damages to.Leeper Electric in the amount
of $675;000.
On December.l'3; 2002,.LeepVr Electric filed a Motion to Correct Errors:The trial Court. granted:Leeper
Electi-ic's motion ih 15art, finding that the jury. aWard'of $675,000 was inadequate and n6t within the
13'o~/nds of thele~ldenc¢~ Thereafter;.the trial court entered judgment for Leeper Electric in the amount of
$1~i20~000~ On Ai3ri[2 I; 2003; in response to Leepet Electric's Motion to Chh'eOt Judgment Entry, the
.trial eoui;t amei~ded i~s jddgme~t in order' to allow Leeper Electric to fec0ver p~ejudgment interest and
litig~ti0n e~penseg in'additiOn to tim $1,120,000 damages award. The City 'of Carmel now appeals.
.. .. . '.' ' ' DISCUSSION AND DECISION
I; Standard of Review
Tt~ei~fial eourt'gra~t~d'L~per Eiectric"s Motion tO Correct Errors and entered final judgmem on th~
evidei-/ffe for the "gmount of proper damages" pursuant to Ind. Trial Rule 59(1-)(5). When considering a
i motion to correct error~ and a i'eqUest for entry of final judgment on the evidence, a trial court is
governed by T,R. 59(J)(5), wh[ch' provides:
The court, if it determines that Di'ejudicial or harmful error has been committed, sfiall take such action as
Will cure the error, iffcluding without limitation the following with respect to ail or some of [he parties
and ali or some Of the er?ors... '. (5) In the case of excessive or inadequate damages, enter final
judgment on the evidence for the amount of proper damages, grant a new trial, or grant a new trial
subject to addittir or remittitur.
T.R. 59(J)(5). This r~medy is available only where the evidence is insufficient to support the verdict as a
matter 6flaw. Precision Screen Mach. v. Hixson, 711 N.E.2d 68, 70 (Ind. Ct. App. 1999). Moreover-, the
tria} judge Sits as a "thirteenth j aror" and must determine whether in the minds of reasonable persons a
contraty verdict shquld have been reachdd. Neher v. Hobbs, 752 N.E.2d 48, 52 (Ind. Ct. App. 2001)
(citifig.Hixson,'7'l 1 N.E'.2d at 70)). The trial judge, as a "thirteenth juror," hears the Case along with the
jaty, observes the witnesses for theft credibility, intelligence, and Wisdom, and determines 'whether the
verdiLt is against the ;veight of the evidence. Id.
Once the trial court has ~ntered final judgment On the evidence for the amount of proper damageg, we
http://www.ai.org/jUdiciary/opinions/completed]03180408 j sk.html
3/18/2004
will reverse this decision only for an abuse of discretion. Dughaish ex rel. Dughaish v. Cobb, 729
N.E.2d 159, 167 (Ind. Ct. App. 2000), trans, denied. An abuse of discretion will be found when the trial
court's action is against the logic and effect of the facts and circumstances before it and the inferences
which may be drawn therefrom. Neher, 752 N.E.2d at 52. An abuse of discretion also results where a
trial court's decision is without reason or is based upon impermissible reasons or considerations. Cobb,
729 N.E.2d at 167.
In determining whether the trial court properly entered final judgment on the evidence, this court
employs the same standard'of review as the trial court. Russell v. Neumann-Steadman, 759 N.E.2d. 234,
237 (Ind. Ct. App. 2001); Carbone v. Schwarte, 629 N.E.2d 1259, 1261 (Ind. Ct. App. 1994). We must
on13/ censider the evidence and reasonable inferences favorable to the non-moving party. Russell, 759
N.E.2d at 237. We may not weigl~ conflicting evidence or judge the credibility of wimesses because of
the e0nstitutiona! right Under ArtiCle 1, Section 20 of the Indiana Constitution to have a jury perform the
'fadt;fmding functi0r~S. Id.; Ind,. Const. art. 1, § 20.
Therefore; it is our d~iy'to affn~ the trial court's final judgment on ~e evidence for the amount of
propar damages 'unle'ss it-iS clearly demonstrated by the City of carmel that the trial court abused its
discrofi0h..
II. Motion to Correet'Err0rs
Th'e. Cit~ of Cai~ei arguei that the trial court abused its disCretivn when'it granted Leeper Electric's
. M0'fi6n t0.'C6rr¢ct Eff0rs pursiiant to T.R. 59(J) and awarded $1,120,000 in damages to Leeper Elec'tric.
.Specifi~ally, the City: qf C~el contends that the evidence Was sufficient to support the jury's verdict of
$675~000. Leeper El~qtfic, however; argues that the trial court correctly entered judgment for the amount
Of proper damages, because the jury's award determination was not within the bounds of the evidence.
A~jury is i0 be afforded great latitude in making damage award determinations. Hixson, 711 N.E.2d at
.70..A Verdict ~ill belupheld il'the aWard falls within the bounds 0fthe evidence. Ritter v. Stanton, ?45
N.E,2d:828, 845.([nd. Ct. App'. 2001), CarbOne, 629 N.E.2d at 1261. The thai court may'only reverse a
jury'veidi~t "whenit.is appareht from a review of the evidence that the amount of damages awarded by .
.. the jury. is so small 6r so gre'a~ as to clearly indicate that the jury was motivated by prejudice, passion,
'partiality, cOtrupti0n,.o~- thai'it considered an improper element." Dee v. Becket, 636 N.E.2d 176, 177
'.(In~. Ct.. App. 1994).i.' .
Moreovei, it is. generally held that upon. review an appellat~ court wili not disturb an award of damages
in ah'eYni~nt domaifi proceeding Where the award is within the bounds of{he probative eVidence
addaced..at trial,. Hein~ld 484 N.E.2d at 597 City OfElkha~.t v. No-Bi Corp., 421 N.E.2d 43 (Ind. Ct.
App.' 1981~). Ih City:of Elkhart, the Court stated that: .
On review of su6h afl 'award, the appellate co¢.rt will neiiher reweigh the evidence nor'judge the
.credibility of the witnesses; The evidence will be looked at in a light most favvrable to the judgment.
M:'at 45.
· ' Th~ foregoing roles tend to give great deference to damage awards in eminent domain case~ because Of
the fact-finder's &bility to hear the evidence and judge the credibility of witnesses first hand. However,
the Indiana Suprem~ Cou~t imposedlimitation upon juries in these cases in Gradison v. State, 260 Ind.
688, 6~5:96, 300 N.E.2d 67, 74-75 (1978), when it determined that in eminent domain cases, the j~ry
may'~ot btise its verdict upon its independent knowledge of values. If the testimony of value and
dafnages is conflleting, the jury may resort to their own general knowledge of the elements which affect
the asges~mem, !n Order to determine the relative weight of conflicting testimony, but their assessment
mast be supp6~ed by testimony, or it cannot stand. See City of Elkhart, 421 N.E.2d at
In ~ghing fhat the jury'S award ofdamages in the amount of $675,000 was within the bounds of the
evidence presented at triai~ the City of Carmel claims that the appraisers' valuations of the Leeper
Electric pr0pOrty Were highor than the actnal fair market value because the property was undeveloped,
· tthlmproYed; had no access ~0 southbound U.S: 3 l_, and was surrounded by other unimproved property, a
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church, and a retirement center. However, Leeper Electric maintains that there is no evidence that the
fair market value of the Leeper Electric.property, given its highest and best use on the date of the.taking,
was $675,000. Rather, Leeper Electhc claims that the evidence shows that the fair market value of this
property was no less than $~,120,000, and the jury's verdict was clearly outside the bounds of the
evidence.
Here, the record before us indicates that fair market value of the Leeper Electric property as of the date
of[he taking, i.e., NOvember 3, 2000, was no less than $1,120,000. The appraisers used a comparable
sales approach Wherein the selling price of other "comparable" property xvas used to determine the fair
market value of the Leeper Electric proPel'ry. Fred Ellis, an appraiser, testified that, in his opinion, the
fair market value of the Leeper Electric property based on four comparable sales was $1,400,000.
Appi'aiser Mervyn P0sner, using.the same four comparable sales, testified that the Leeper Electric
property was ;qalued at $1,300,000. Another appraiser, William Sanders, used three different comparable
sales as the basis ofl~s opinion and testified that the Leeper Electric property was worth $1,375,000 as
of the date of the taking. A fourth appraiser, Michael Lady, See footnote used six comparable land sales
'to form his oPinion that, as of the date of the taking, the Leepe~ Electric properly was valued at
$1,120,'000. Mr. Leeper also testified, and he opined that the property was worth $1,700,000..
According tO [he City of Carmel, ali four appraisers based their valuations of the Leeper Electric
properly upon.an exffapolation of in~'ormati0n concerning the sale of other properties which were far
superior'tO the Leepe3"Electric property by virtue of their location, access eharaCtefistic~ Zoning,
'physical ch~racteris'ti'c~'and/or impr6Vements. Many of.the sales used by the appraisefg as comparable
p'ar~els Were located in established retail or commercial developments. The parcels that the appraisers
¢o~npared:'Svith ~he si~bj~ct property also possessed bi-direCtional access tO U.S. 31. Several of the ·
parcels of land were~located in existing commercial developments that offei'ed full utilitieS, Off-site
ret~nti0flfiaf~d isthe'r 15enefi.ts. Further, the City of Carmel notes that flee of the comparal3le saies were
. located oUtside(the City of-C&rmel in areas with thriving retail and business establishments. Three Other
pr0pg~ties ~,'ere'10¢at~d in proximity and with good access to U.S. Interstate 465 (I-465). Therefore, the
City of:~armel maintains'that the evaluations wei:6' based on the sales of other properties that were
superior to the Leeper EIe~tricproCefty and that the jury Properly Weighed the evidence and awarded
dan~ages:in the amo~ht of $675;000.
The City 'of darineI, c6ntends thfit the jury was entitled to conside'r.the underlying assumptions upon
Whi~h'tl~e ~/pi~raisers:based their opinions, and if such assumptions were not true~ t9 "decide what [a]
ffeCh if any, ~hat hadi0n the appraisers' opinions." Appellant's Brief at 15. In particular, the City of
carmel a/~gUes that"it.Was entirely within the purview of the jury to [eview the comparable sales Used
by the appi'aisers called to the stand by Leeper and to consider what effect the superiority of these
~o~nP~able sales, due t6 their'location within an existing retail cenfer or office p~rk, proximity to 1-465'
or to 1-69,:bilateral a~cesg to and from U.S. 31, improv.ements, availability of'full utilities, differences in
size,, and Other stupefier traits Would have upon their value in comparison to the Leeper Electric
property ~'.Appellaht's Brief at 15.' The jury, according to the City of Carmel, was also entitled to
conclude that the value of the Leeper Electric proper~y was less than the sales price of the superior
properties.considered, comparable by the appraisers.
The only evidence ora Value less than $1,120,000 for the property was Leeper Electric's 1996 purchaser
price of $100~000. The'price voluntarily paid by a purchaser is admissible as evidence of the property's
fair marl~et value,See Marshall v. Bird, 577 N.E.2d 254, 256 (Ind. Ct. App. 1991); State v. Valley Dev.
'Co., Inc., 256 Ind. 2?8,281,268 N.E.2d 73, 76 (1971): However, we cannot say that the price paid.for
· the land here, standing alone, is sufficient to estabhsh the fair market value of the property fottr years
after the s~il~ and:~tlet ithe. Pr0Pe~ty was rezoned.to a higher use~,,from residential to commercial. The
orily evide,nce Usingthe highest arid best use of the property as o[the date of the taking were the
appraisers valuation~ of the property as a commericalPousiness jrroperty. '
In Stat~ vl :Raymond'E. Heinold Family Trust; 484 N.E.2d 595,/598 (Ind. Ct. App. '1985), this court
found that.it was prope~r for the appraiser to determine the val~fe of the trust property before the taking
.by applyirig the high~st and best use of property criteria. Mo~over, in Lucre Corp. v. County of Gibson,
' http://gmrwlai'6i'~JaCli¢iarY~opini°ns/compieted/03180408.j sk.~ ' ' 3/18/2004
657 N.E.2d 150, 156 ~Ind. Ct. App. 1995), we stated that "an award of damages in an eminent domain
proceeding will not he disturbed where the award is within the bounds of the probative evidence
adduced at trial." In Lucre, the record revealed that the experts valued the property from $130,000 to
$6,300,000; the jury determined Lucre's damages to be $130,500. Id. Because the award was within the
bounds of the pt'obat!v~ evidence, this court found no error. Id.
The City of Carmel argues that the jury's verdict was within the bounds of the evidence and, therefore,
the trial court abused its discretion by applying T.R. 59(J)(5). Because the property value could be
properly adjusted for the passage of time by increasing its value by five percent (5%) per annum, to
determine its value in 2000 by taking the purchase price of $100,000 in 1996, and then adding to that
figure a 5% inflation factor per year to determine the fair market value of the property as of the date of
the faking. Leeper Electric responds that there ar~ three recognized methods for determining a property's
fair market value, and the City of Carmel's suggested method is not one of them.
In State v. Bishop, .800 N.E.2d 918 (Ind. 2003), our supreme court recently addressed how to assess
the fair mhrket value.0f property that is taken by condemnation. There, our Sup'reme court stated that it is
Well established in Indiana that the basic measure of damages in eminent domain cases is the fair market
value 0fthe property at the time Of the taking. Bishop, 800 N.E.2d at 923; State v. Church of the
Naza};ene Of Logansport 268 Ind. 523,526, 377 N.E.2d 607, 608 (1978). Seefostno[e Fair ma, rket
Valfl6 is the price at Which pri~perty would change hands betvceen a willing buyer attd'seller, neither
being Under any comPUlsion to-Consummate the sale. Ohio Cas. Ins. Co. v. Ramsey, 439 N.E.2d 1162,
1167 Uatd. Ct. App..1.982). '~Anything affecting the sale value [on the date of the taking].., is a proper
mane~ for the jury's:d0i'/Siderati0n in attempting to arrive at a 'fair market'value:'" SO~thern Ind. Gas &
.. El~c. Co. ~.'Gerhardt, -241 Ind. 389, 393, 172 N.E.2d 204, 205-06 (1961).
Bishvp set Out the three widely a~cepted.approaches to egtimating the fair nim-ket value of property
taken by eminent domab: The three methods Of evaluation are: (1) the current cost of reproducing the
· .property less depreeiati0n' from all sources; (2) the market data approach or value indicated by recent
sales 6f c6mpai'able ~6ropertieS in the market; and (3) the income-approach or'the value which the'
p~'6perty's net earmng power will-support based upon the capitalization of net income. Bishop, 800
N.E.2d at 923-24; State v. ,Ion.es, 173 Ind. App. 246, 251, 363 N.E.2d 1018, 1024 (1977). In the
appraisal of teal estate,-any one 0~ all thi'ee of these approaches to estimate the fair market value may be
applied. ~lnnon. I[. Inc. v. Rill, 597 N.E.2d 320, 327 (ind. Ct. App. 1992).
In the present case, 'the appraisers correctly usgd the market data approach to determine.the fa3r
rnarket.x~alue of the si~bjeet property. The remaining approaches for determining th6. fa jr market value of
the Sttbject property Were not applicable because the subject property was not developed. Thei'e were no
builditigS or improvefnerits located on the real estate. The subject pi'operty was not _earning m6ney from
'either ~t'btminess.op'erating onthe property or from the property's natural resOurcEs.and there was
nothing to reproduce except for the actual property.
Leer/er Electric rri/tintains, at~d we agree, that a valuation by merely takingthe purchase price of the
pr6perty and multiplying' it by a figure for annual appreciation is not, as th'e City.of Carmel suggests, a
recognized'n'i6ttitSd"t0 deter~ne.the fair market value of real estate in an eminent domai~ proceeding..
Appraiser F~'ed Ellis.t~stified that he could not find any sales to give him a true appreciation figure.
Moreover, even if such a method were recognized, it would not '6e applicable when the zoning ..
classification 6f~e pt'operty changes from the time it is acquired to the time it is condemned. Here, the
zomng of the Leeper Electt/c property when th~ property was ficquired was S-2 residential property.
.However, the appraisers testified that the highest and best use of the property ~vas for commercial or
business use. A landowner is entitled to the value of the property at its highest and best use, not
necessarily the use 16 which it is presently bgmg put. Heinold, 484 N.E.2d at 598. There is no evidence
'. ~at the highest arid best use 0fthe property was for residential use on the date o.f the taking..hq fact, the
evidence sh6ws that the City of Carmel rezo~ed the U.S. 31 corridor to B-$.,~which accommodatdd the
use of the i~ropertya~ a:h6tel. See Appellant S Appendix dt 61. The zoning fo~) a h0t6l was present and
.there Was rio need t6rez0ne to permit this commercial use. Leeper Electric n,~eded a height valance to
,. 't~6c0nuhodate the ho!el's number of stories. This variance was appro.ved b/7/theCity'of Carmel s
''l-/ttp:)/ww~.ai:" ' ' drg/.jU~libi a ry/o~i n io~ s/CO m pl ete d/03180408 jsk.ht, m 1 · ""-- '-* --3/[8/2004
rage o oI o
appropriate agencies, but the City of Carmel blocked Leeper Electric from developing the property by
imposing a moratorium and passing an ordinance prohibiting any development of the property.
Based on the evidence presented, the value of the subject property, on the date of the taking was no less
than $1,120,000. The appraisers used the market data approach or value indicated by recent sales of
comparable properties. This is one of the widely accepted methods for determining the fair market value
of property. Sbe Bishbp, 800 N.E.2d at 923. The method of deterw2ning the value of the subject property
suggested by the City of Carmel is not a recognized method of valuation. The jury's award of $675,000
was not. Within the bounds Of the evidence. As a result, we conclude that the trial court did not abuse its
discretion by granting Leeper Electric's Motion to Correct Errors and by awarding damages in the
amount of $1,120,000 pursuant to T.R. 59(J)(5).
Affirmed.
BAILEY, J., and vAIDIK, J., concur.
Footnote: We heard Oral argument in this case on February l l, 2004, in Indianapolis, Indiana.
Footnote:
On cross-appeal. Leeper ElectPic argues that in the ePent this court finds that the trial court abused its
discretioh'in.granting the mbtion to correct errors and awarding $1,120,000 in damages pu~'suant to T.
R. 59(d)(.5) th[it th~ ohIy propeb relief that should b~ granted is a remand for a new trial on ali of the
tssues. BecauSe we affirm the:trial coui't 's finaljudgment on the evidence for the amount 9f the ~roper
'damdges, we do not need to address this issue.
'Footnote: Appraise~'~ Ellis, PoSner. and Sanders were appointed by the trial court to deiermine the fair
marlt~'t value of thg L.eeper Eloctric property as of November 3, 2000, the date of the taking. Appraiser
Lady, howeger..was 'ortgi~ally hirdd by the City of Carmel to be an expert witness. Leepei' Electric
entered Lady '~ deposition textimony as e~,idence at trial.
· Fovtno'te: IC 32-24-4-9(g), which governs the amount of compensation to be awarded in eminent
· dOma?n dases, stated:
~ Fft' thepu~'po~e'ofa~s~ging dompensation and damages, the right to compensation and d~mages is
considered to have a~crued as of the date of the service of the notice proi, ided in's~ction 6 of this'
chapter, and. actual ~alue.of compensatio'n and damages at that date shall be:
(J) th~ measure of compensation fo}' aIl property to be actually acquired; and
.'(2) the basis of damages to property not actually aqquired but injuriously affected; except as to the
damages stated in subsection (c)(4). . .
.' jmp:/Av~wc.ai:org/j~diciary/opirfions/completed/03 180408.jsk.hanl
3/18/2004
VOUCHE~ NO._~_____~_WARRANT NO.
ON ACCOUNT OFAPPRoPRiATiON FOR
ALLOWED
IN SUM OF $
~ 20
Cost distribution ledger classification if
claim paid motor vehicle highway fund
5'?_¢/~bili(s) is (are) true and correct and that the
,oz~materials or.services itemized thereon for
which charge is made were ordered and
received except
Board Members
hereby certify that the attached invoice(s), or
20
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