Hultberg v. Hjelle

• Decision Date: 28 November 1979
• Docket Number: No. 9648,9648
• Citation: 286 N.W.2d 448
• Parties: Harold S. HULTBERG and Betty L. Hultberg, Plaintiffs and Appellees, v. Walter R. HJELLE, North Dakota State Highway Commissioner, Defendant and Appellant. Civ.
• Court: North Dakota Supreme Court

Page 448

286 N.W.2d 448

Harold S. HULTBERG and Betty L. Hultberg, Plaintiffs and Appellees, v. Walter R. HJELLE, North Dakota State Highway Commissioner,

Defendant and Appellant.

Civ. No. 9648.

Supreme Court of North Dakota.

Nov. 28, 1979.

Jos. A. Vogel, Jr., Mandan, for plaintiffs and appellees.

Steven L. Latham, Sp. Asst. Atty. Gen., State Highway Dept., Bismarck, for defendant and appellant.

ERICKSTAD, Chief Justice.

The defendant, Walter R. Hjelle, North Dakota State Highway Commissioner (hereinafter referred to as the Commissioner), appeals from a judgment in the amount of $37,898, said amount representing the total compensation awarded the plaintiffs, Harold S. and Betty L. Hultberg (hereinafter referred to as the Hultbergs), for two tracts of land acquired by the state in eminent domain proceedings. We affirm.

The Hultbergs own a farm in McLean County, North Dakota. Pursuant to the provisions of Section 14 of the North Dakota Constitution, and the statutory authority of the Commissioner in Title 24 of the North Dakota Century Code, the Commissioner sought to purchase 18.77 acres of the Hultbergs' land in fee, and .61 acres for a drainage easement, both tracts of land to be used in the reconstruction and improvement of U. S. Highway No. 83. To acquire possession of the land, the Commissioner offered to purchase the two tracts for $15,819.55, and, concomitant with the filing of the offer to purchase, this amount was deposited with the Clerk of the District Court of McLean County on October 28, 1976, the date of the taking.

On November 8, 1976, and pursuant to Section 24-01-22.1, N.D.C.C., ¹ the Hultbergs appealed to the district court from the deposit made by the Commissioner for the taking of a right of way, asserting that the offer was wholly inadequate and was not representative of the property's current market value. The Hultbergs demanded a jury trial for the purpose of determining a just award of compensation in accordance with Section 32-15-13, N.D.C.C. ²

Prior to the commencement of the trial, the Commissioner made a motion in limine, requesting that the trial court prohibit the Hultbergs "from introducing any evidence in the presence of the jury which would tend to show the value of coal and gravel deposits on the subject tract as an independent element of value." The trial court denied the motion, and the trial commenced on October 31, 1978.

During the course of the trial, three witnesses gave their opinions as to the value of the land taken, as well as the severance or consequential damages to the land retained by the Hultbergs.

Mr. Hultberg, the owner of the land, estimated that the value of his 674-plus acre farmstead prior to the taking was $674,000, or $1,000 an acre. Mr. Hultberg placed the value of the property after the taking at $584,631, or approximately $893 an acre, with the total damages thus amounting to $89,369, including severance damages.

Mr. D. W. Knudson, after qualifying as an expert, testified on behalf of the Hultbergs, and stated that the highest and best use for the property in question was agricultural and farming, with holdings of minerals coal, and gravel for investment purposes. In determining a fair market value for the entire Hultberg farmstead before the taking, Knudson relied upon nine comparable sales, two of which involved the sale of minerals separate from the surface. He testified that the market value of the 674.14 acre tract of land before the taking was.$542,998, or $805 an acre, and the value of the property after the taking was $494,326 or $755 an acre. The difference between the before and after values amounted to $48,672, this amount being Knudson's opinion as to the total damages incurred by the Hultbergs in the taking of their land.

The last witness called at trial was Mr. Donald Doll, the chief appraiser for the North Dakota State Highway Department, who testified on behalf of the Commissioner.

Doll stated that in attempting to reach a figure as to the value of the Hultberg property, he examined approximately twenty-five comparable sales, with particular attention given to nine such sales in reaching a final conclusion. Doll testified that the value of the entire Hultberg farmstead before the taking was $472,832, the values of the acreage differing depending on the location of the land in relation to the City of Coleharbor. Doll estimated that the value of the property after the taking was $456,204, therefore placing the total damage award at $16,628.

On November 2, 1978, the jury returned a verdict in favor of the Hultbergs, awarding them damages in the amount of $37,878. The compensation for the land taken amounted to $11,628, and the compensation for severance damages amounted to $26,250, for a total award of $37,878.

On December 19, 1978, the State filed a motion for a new trial. The reasons assigned for the motion were that the testimony of the Hultbergs' expert witness, D. W. Knudson, was in conflict with the generally accepted appraisal methodology and rules for the admissibility of valuation testimony, and that such testimony had been relied upon by the jury.

The motion for a new trial was denied by the trial court in accordance with its memorandum opinion dated February 16, 1979, and judgment was entered on March 6, 1979. Judgment was for the sum of $37,898, inclusive of the $15,819.55 on deposit, plus interest on the sum of $22,058.45 from October 28, 1976, at the rate of six percent until paid, plus costs and attorneys' fees in the amount of $18,927.83. The Commissioner appeals to this court from that judgment. No issue is raised over the attorneys' fees and costs.

Eminent domain is the right to take private property for public use. The law provides that private property shall not be taken or damaged for public use without just compensation first having been made to the owner. The determination of what constitutes just compensation is a question for the jury to resolve, unless the right to a jury is waived. N.D.Const. § 14; § 32-15-01, N.D.C.C. The only function of a jury in eminent domain cases is to assess damages. City of Minot v. Minot Highway Center, Inc., 120 N.W.2d 597 (N.D.1963).

Section 32-15-22, N.D.C.C., defines the forms of compensation to be awarded in eminent domain proceedings, and reads:

"32-15-22. Assessment of damages. The jury, or court, or referee, if a jury is waived, must hear such legal testimony as may be offered by any of the parties to the proceedings and thereupon must ascertain and assess:

1. The value of the property sought to be condemned and all improvements thereon pertaining to the realty and of each and every separate estate or interest therein. If it consists of different parcels, the value of each parcel and each estate and interest therein shall be separately assessed.

2. If the property sought to be condemned constitutes only a part of a larger parcel, the damages which will accrue to the portion not sought to be condemned by reason of its severance from the portion sought to be condemned and the construction of the improvement in the manner proposed by the plaintiff.

3. If the property, though no part thereof is taken, will be damaged by the construction of the proposed improvement, the amount of such damages.

4. If the property is taken or damaged by the state or a public corporation, separately, how much the portion not sought to be condemned and each estate or interest therein will be benefited, if at all, by the construction of the improvement proposed by the plaintiff, and if the benefit shall be equal to the damages assessed under subsections 2 and 3, the owner of the parcel shall be allowed no compensation except the value of the portion taken, but if the benefit shall be less than the damages so assessed, the former shall be deducted from the latter and the remainder shall be the only damages allowed in addition to the value of the portion taken.

5. As far as practicable, compensation must be assessed separately for property actually taken and for damages to that which is not taken."

Compensation for property actually taken for public purposes, and damages for property not taken but injuriously affected, must be ascertained and assessed pursuant to the provisions of this section. Little v. Burleigh County, 82 N.W.2d 603 (N.D.1957).

In proceedings to determine damages sustained by the owner of a farm where land is condemned for highway purposes, the landowner is entitled to be paid the value of the land taken plus the damages which accrue to the remainder of the land because of its severance from the part taken and the construction of the highway. Frederickson v. Hjelle, 149 N.W.2d 733 (N.D.1967); Wishek Investment Co. v. McIntosh County, 77 N.D. 685, 45 N.W.2d 417 (1950); Lineburg v. Sandven, 74 N.D. 364, 21 N.W.2d 808 (1946).

The general rule for determining the value of property taken pursuant to Section 32-15-22, N.D.C.C., is a consideration of the fair market value of such property. City of Hazelton v. Daugherty, 275 N.W.2d 624 (N.D.1979); Little v. Burleigh County, supra. The fair market value is to be determined at the date of the taking, which in this instance is October 28, 1976. Section 32-15-23, N.D.C.C.

This court has defined fair market value in eminent domain cases as the highest price for which property can be sold in the open market by a willing seller to a willing purchaser, neither acting under compulsion and both exercising reasonable judgment. City of Hazelton v. Daugherty, supra; Minot Sand & Gravel Co. v. Hjelle, 231 N.W.2d 716 (N.D.1975); See § 24-01-01.1(23), N.D.C.C.

This court has also said that an award in a condemnation case will be sustained if it is within the limits of the damages testified to by the witnesses. State v. Livingston, 270 N.W.2d 556 (N.D.1978).

With these considerations in mind, it becomes necessary to examine the record to determine if error was committed in placing a fair market value on the Hultberg property...