Herro v. Natural Resources Bd.

• Decision Date: 02 December 1971
• Docket Number: No. 255,255
• Citation: 53 Wis.2d 157,192 N.W.2d 104
• Parties: Norman C. HERRO, as Trustee for himself, et al., Appellant, v. NATURAL RESOURCES BOARD, an agency of the State of Wisconsin, Respondent.
• Court: Wisconsin Supreme Court

Page 104

192 N.W.2d 104

53 Wis.2d 157

Norman C. HERRO, as Trustee for himself, et al., Appellant, v. NATURAL RESOURCES BOARD, an agency of the State of

Wisconsin, Respondent.

No. 255.

Supreme Court of Wisconsin.

Dec. 2, 1971.

Rehearing Denied Feb. 1, 1972.

Condemnation proceedings were instituted by Natural Resources Board, respondent, (hereinafter Board of DNR) to acquire certain interests of Norman C. Herro, and others, (hereinafter appellant) in two parcels of real estate located in Kenosha county, Wisconsin.

The Kenosha county land commissioners determined the fair market value of the land to be $244,250. The money was deposited with the clerk of court of Kenosha county. Thereafter, by stipulation of the parties, the money so deposited was paid to the appellant. It appears that the determination of what is the fair market value of appellant's rights will be determined by a jury condemnation trial now pending in the circuit court for Kenosha county.

The present litigation was instituted in the circuit court for Kenosha county to challenge the validity of the condemnation proceedings instituted by the DNR. The trial court entered judgment dismissing the action of the appellant. Thereafter the trial court denied appellant's motion to set aside the judgment and to take additional evidence, or in the alternative for a new trial upon newly discovered evidence.

Appellant appeals from the judgment dismissing the action and from the order denying post-trial motions.

Foley & Lardner, Milwaukee, for appellant; Herro, McAndrews & Porter, Madison, of counsel.

Robert W. Warren, Atty. Gen., Charles A. Bleck and Steven M. Schur, Asst. Attys. Gen., Madison, for respondent; W. Scott Van Alstyne, Jr., Madison, of counsel.

CONNOR T. HANSEN, Justice.

The trial court well described the posture of this case in stating, 'The question which arises in this case, tried to the Court, involves not so much a dispute as to the facts but rather a dispute as to the interpretation of the law to be applied to those facts.'

FACTS.

Two parcels of land are involved in these proceedings, a 977 acre tract owned in fee by appellant, and a 1591 acre tract in which appellant owns what can be described as an option to purchase. These parcels are part of a larger tract initially acquired by the federal government for the purpose of establishing the Bong Air Force Base.

In Herro v. Wisconsin Fed. Supr. P. Dev. Corp. (1969), 42 Wis.2d 87, 166 N.W.2d 433, this court defined the property rights of appellant in these two tracts and held that ch. 646, Laws of 1965, insofar as it purported to transfer the federal lands to the State Conservation Commission (hereinafter commission) was unconstitutional for failing to comply with the necessary procedural requirements for condemnation. March 10, 1967, relying upon the validity of ch. 646, and pursuant to sec. 32.12, Stats., the Board adopted a resolution of necessity to condemn appellant's interest in the land. A professional appraiser was employed by the commission, and as of August 1, 1967, appraised the 977 acre tract at.$390,000, stating that its highest and best use was for agricultural purposes. The appraiser rejected appellant's proposal to develop the land for airport and industrial purposes as its highest and best use. Thereafter, negotiations took place between the commission and appellant for the purchase of the latter's interest, with offers by the commission of $350,000, $360,000, and $400,000, between November 6, 1967, and June 24, 1968. Appellant was willing to negotiate in the area of $800,000.

April 17, 1969, the Board employed the same appraiser to update the appraisals of the 977 acre tract, and to include appellant's interest in the 1591 acre tract. The new appraisals, as of June 1, 1969, ascribed a value of $450,000 to the 977 acre tract, $675,000 to the 1591 acre tract, and $1,130,000 to the two tracts combined. The appraisals were based on the conclusions that the highest and best use of the land was for agricultural purposes, and the appraisal of the 1591 acre tract was on the value of the land itself as opposed to appellant's interest therein. July 25, 1969, J. R. Smith, with the approval of Lester P. Voigt, chief executive officer of the DNR, offered to purchase the interests or appellant in the property for $600,000, subject, however, to final approval by the Board and by the Governor. Appellant was given until August 4, 1969, to accept the offer. July 30, 1969, appellant was advised by the Board that it would consider the necessity of condemnation proceedings at a meeting on August 14, 1969. Appellant rejected the offer of $600,000 on August 4, 1969, and indicated an intent to proceed with the development of the area. August 14, 1969, appellant appeared before the Board and presented its proposal for the development of the area, reiterating a request that the Board establish the fair market value of the 1591 acre tract to enable appellant to exercise his option to purchase and begin development. The same day, the Board adopted a formal resolution for condemnation of the interests of appellant. At the same time the Board endorsed a legislative bill (S. 593) which provided for acquisition of the same lands by the State Building Commission and a study to determine the best public use of such lands. August 15, 1969, the Board sought the approval of the Governor for the institution of condemnation proceedings pursuant to sec. 20.914, Stats. The Governor was advised by the Board of appellant's rejection of the offer made on July 25th and the necessity for acquiring the land to preserve the contiguity of the tract. The Board stated it was also endorsing the legislative bill because it recognized a difference of opinion as to the highest and best use of the land and was willing to cooperate with other state agencies on this matter. The Governor approved the resolution on September 17, 1969. However, the Governor denied the Board's request to retain private counsel in the condemnation proceedings.

Subsequently, the DNR turned the matter over to the attorney general's office where it was assigned to Charles Bleck. After reviewing the prior appraisals, Bleck informed Smith that the felt they were not accurate and suggested employing new appraisers. Bleck felt that the appraisals were 'ridiculous' because they were based on the theory that the highest and best use was for agricultural purposes when the land had been compacted and filled with gravel in preparing it for airport purposes. However, there was testimony that the federal government had restored some of the topsoil and appellant had rented out the land for five or six years for purposes of farming. Bleck recommended F. E. Gutschenritter and A. W. Mayo as appraisers, and after these individuals were approved by Smith, they made two separate appraisals. Gutschenritter concluded the highest and best use of the land was for agricultural purposes and appraised the fair market value of the 977 acres at $135,000 as of November 1, 1969. Mayo concluded the highest and best use of the land was for airport and industrial development and appraised the fair market value of the 977 acres at $142,000, as of November 24, 1969. Both appraisers concluded that the interest of appellant in the 1591 acre tract had no market value. Bleck testified he and discussed with Gutschenritter and Mayo, prior to the time the appraisals were made, his own approach in the valuation of the property. He informed them that under the agreement of appellant, the development of the property constituted a situation comparable to zoning restrictions or a restrictive covenant and that this factor should be considered in making the appraisals.

After this court's decision in Herro v. Wisconsin Fed. Surp. P. Dev. Corp., supra, appellant met with representatives of the attorney general's office and Judge CHARLES in an effort to reach a final judgment in accordance with the decision. Meetings held on September 19th, October 10th and November 14th, 1969, resulted in general consensus that the Board proceed with the condemnation action prior to any final determination of the judgment. Appellant testified that the thrust of the meetings was to proceed with condemnation expeditiously, acknowledging however, that if condemnation was abandoned, the value of the 1591 acre tract would be determined and appellant would exercise his option and proceed with the development of the land.

October 25, 1969, proposals were submitted on behalf of appellant for a stipulation, findings of fact, conclusions of law and a judgment. The proposed stipulation acknowledged the resolution of the Board in regard to condemnation proceedings, the approval by the Governor, and the fact that the attorney general was proceeding to initiate a condemnation action. The proposed findings of fact recited the requirement that the Board make a jurisdictional offer by November 1, 1969. The date was changed to December 1, 1969, in a revised draft of these proposals. The documents were never executed.

November 28, 1969, Voigt authorized the attorney general's office to proceed with a jurisdictional offer of $135,000 although neither Voigt nor Smith had examined the Gutschenritter or Mayo appraisals prior to this time. Smith acknowledged that the extent of the participation of the DNR in the jurisdictional offer and negotiations subsequent to the determination of necessity consisted only of the execution of documents of authorization. November 28, 1969, after receiving an authorization from Voigt, Bleck presented the offer in person to appellant. Bleck testified that he was somewhat embarrassed in making the offer in view of the previous offer of $600,000, but testified he went into great detail in explaining the theory of law upon which the appraisal was based. Appellant indicated he was not prepared to make a counter offer at that time and asked Bleck to make another offer. Bleck replied he would...