Boring v. Metropolitan Edison Co.

• Decision Date: 09 October 1969
• Citation: 257 A.2d 565,435 Pa. 513
• Parties: Paul L. BORING and Mary M. Boring, his wife v. METROPOLITAN EDISON COMPANY, Apt.
• Court: Pennsylvania Supreme Court

Page 565

257 A.2d 565

435 Pa. 513

Paul L. BORING and Mary M. Boring, his wife v. METROPOLITAN EDISON COMPANY, Apt.

Supreme Court of Pennsylvania.

Oct. 9, 1969.

Samuel B. Russell, John S. McConaghy, Ryan, Russell & McConaghy, Reading, Samuel S. Laucks, Jr., Laucks & Monroe, York, for appellant

J. Ross McGinnis, Stock & Leader, by Gilbert G. Malone, York, for appellees.

Before BELL, C.J., and COHEN, EAGEN, O'BRIEN, ROBERTS, and POMEROY, JJ.

OPINION

EAGEN, Justice.

This is an appeal by the Metropolitan Edison Company (hereinafter Condemnor) from the judgment entered in the court below upon a jury's verdict awarding $25,000 in damages to Paul L. Boring and Mary M. Boring (hereinafter Condemnees) in an eminent domain action.

On November 22, 1965, the Condemnor condemned a right of way across the unimproved 43.46 acre tract of the Condemnees for the purpose of erecting thereon an electrical transmission line. The Condemnees' land is located in close proximity to Pinchot State Park, a resort attracting large numbers of patrons to its water and park facilities. Along the road boundaries of the Condemnees' property, a small number of lots have been sold, on which modest homes are erected. Although the tract is otherwise unimproved and essentially agricultural in nature, a grass airplane landing strip had been created on it by the York County Sky Divers Association in 1965 by virtue of a written lease to it from the Condemnees. The lease was dated December 14, 1964, and ran for a period of 20 years, at a rental of $1.00 for the first year; $2,400.00 for the second year; $3,600.00 for the third year; $4,800.00 for the fourth year; and $5000.00 for the fifth and each succeeding year. The strip was used by members of the lessee in the summer and fall of 1965 for the taking off and landing of airplanes in pursuit of their sport of sky diving. The lease also reserved the joint use of the landing strip to the lessors and anyone else who might erect homes on the remaining portion of their property. The right of way in question was taken by the Condemnor by a resolution adopted on March 12, 1965, effective as of November 22, 1965. It (the right of way) contained 2.94 acres, and consisted of a strip 200 feet wide running for a distance of approximately 639 feet roughly across the center of the Condemnees' land and almost directly bisecting the landing strip.

By letter dated October 29, 1965, the Sky Divers Association terminated its lease because of the imminence of the condemnation which would make impossible the use of the land leased as an airstrip.

At the trial, both sides presented expert testimony by two valuation experts. The Condemnees' experts testified that the highest and best use of the property was as a sky park or sky port development because of the uniqueness of the terrain and the advantage of its location near Pinchot State Park between York and Harrisburg. A sky park was described as a type of residental building development on which substantial homes are erected from and to which the residents may fly their own planes, using the adjacent landing strip communally.

Taking into consideration this highest and best use, the general potential of the land for air-related uses and the lease to the Skydivers, the Condemnees' experts gave their opinion of the market value of the property before condemnation as being $116,000 and $114,792 and the value thereof after condemnation as $32,000 and $27,867 respectively with consequent damages of about $86,000. The testimony of the Condemnor's experts was that the highest and best use of the property both before and after the condemnation was as a site for mobile homes or a trailer park with the possibility of the sale of lots for cottage-type homes. Their opinion of market value before condemnation was $26,000 and $28,200 and the market value after condemnation was fixed at $22,600 and $24,600 respectively, resulting in damages of $3800 or $3600.

The Condemnor first contends that the evidence presented by the Condemnees was inadequate as a matter of law to support a finding by the jury that the highest and best use of the land involved prior to condemnation was as a sky park or sky port, in that it failed to establish a need or demand for such purposes in the locality involved. In regard to the issue of need or demand in the locality, the Condemnor cites Shillito v. Metropolitan Edison Company, 434 Pa. 172, 252 A.2d 650 (1969), and Pa. Gas & Water Company v. Pa. Turnpike Commission, 428 Pa. 74, 236 A.2d 112 (1967). This assignment of error is presented here for the first time and was never raised in the court below. Under such circumstances, we will not consider it. Glass v. Freeman, 430 Pa. 21, 240 A.2d 825 (1968).

The Condemnor next contends that the instructions of the trial court to the jury were inadequate on the issue of the highest and best use. The record discloses not only that the Condemnor entered neither a special nor a general exception to the charge, but also that at the end thereof, when invited by the court to request additional instructions, replied, 'I have no further requests.' Additionally, and very significantly, this assignment of error was not asserted in the court below in Condemnor's motion for a new trial. Hence, this issue is likewise raised belatedly.

The Condemnor next contends that the valuation methods used by the Condemnees' valuation experts were improper in respect to their treatment of the rentals provided for in the Condemnees' lease to the sky diving club. Both of the Condemnees' experts testified that they took the gross income of some $90,000 receivable over the twenty-year period of the lease which had been terminated because of the imminence of condemnation and applied thereto a 40% Discount rate to reduce the gross income figure to its present value and thereby assigned a specific value of $54,000 to the leased portion of the premises, which $54,000 was included as a constituent element of their before-condemnation market value of the premises as a whole. The thrust of the Condemnor's contention is that the effect of such testimony was to treat the rentals reserved in the lease as a separate, recoverable item of damage and that the jury should have been instructed that while the rent reserved in the lease was a proper factor to be considered in arriving at the fair market value of the property, it was not to consider this testimony of the Condemnees' witnesses as evidence of a separate item of value which was lost by virtue of the condemnation.

Section 705 of the Eminent Domain Code, Act of June 22, 1964 (Spec.Sess.) P.L. 84, Article VII § 705, 26 P.S. § 1--705 which is here applicable provides in part as follows:

'(2) A qualified valuation expert may testify on direct or cross-examination in detail as to the valuation of the property on a comparable market value, reproduction cost or capitalization basis, which testimony may include but shall not be limited to the following: * * * (ii) the rent reserved and other terms of any lease of the condemned property or comparable property which was in effect within a reasonable time before or after the date of condemnation. (iii) The capitalization of the net rental or reasonable net rental value of the condemned property, including reasonable net rental values customarily determined by a percentage or other measurable portion of gross sales or gross income of a business which may reasonably be conducted on the premises, as distinguished from the capitalized value of the income or profits attributable to any business conducted thereon.'

In Westinghouse Air Brake Co. v. City of Pittsburgh, 316 Pa. 372, 176 A. 13 (1934), we held that there was no error in admitting in evidence the actual rent received for the property as reflecting on its market value though it was not admissible as an...