Lido Boulevard, Town of Hempstead, Lido Beach, Nassau County, In re

• Decision Date: 26 November 1973
• Citation: 349 N.Y.S.2d 422,43 A.D.2d 45
• Parties: In re LIDO BOULEVARD, TOWN OF HEMPSTEAD, LIDO BEACH, NASSAU COUNTY. In the Matter of the County of Nassau (South Side of Park Street (Lido Boulevard), Vicinity of Bay Lane, Town of Hempstead, Lido Beach, etc.). COUNTY OF NASSAU, Appellant-Respondent, v. COLONY BEACH CLUB OF LIDO, INC., Respondent-Appellant.
• Court: New York Supreme Court — Appellate Division

Page 422

349 N.Y.S.2d 422

43 A.D.2d 45

In re LIDO BOULEVARD, TOWN OF HEMPSTEAD, LIDO BEACH, NASSAU COUNTY In the Matter of the County of Nassau (South Side of Park Street (Lido Boulevard), Vicinity of Bay Lane Town of Hempstead, Lido Beach, etc.) COUNTY OF NASSAU, Appellant-Respondent, v. COLONY BEACH CLUB OF LIDO, INC., Respondent-Appellant.

Supreme Court, Appellate Division, Second Department.

Nov. 26, 1973.

Joseph Jaspan, County Atty. (Leon Friedman, Mineola, and Robert T. Bloom, of counsel), for appellant-respondent.

Sprague, Dwyer, Aspland & Tobin, Mineola (Joseph L. Tobin, Jr., Mineola, of counsel), for respondent-appellant.

George C. Pratt, Williston Park (George B. Costigan, Jr., and Samuel S. Tripp, Williston Park, of counsel), for the Town of Hempstead, amicus curiae.

Before HOPKINS, Acting P.J., and MUNDER, LATHAM, SHAPIRO, and BRENNAN, JJ.

PER CURIAM.

This appeal and another appeal also presently before us bring up for consideration two condemnation awards made by the Special Term in Nassau County, each for a separate parcel of property, title to which parcels was vested on the same day by the County of Nassau for park purposes. The claims were tried separately before the same Trial Justice and resulted in a partial final decree in the instant case for claimant Colony Beach Club of Lido, Inc. in the sum of $2,233,500, plus interest, and in a resettled partial final decree in the other case for claimant Shelborne Beach Club, Inc. in the sum of $1,219,781, plus interest and costs.

Both properties were condemned on December 18, 1967. The Shelborne appeal, by the claimant only, is from a resettled partial final decree dated January 6, 1972. In the Colony case, the claimant and the condemnor have appealed, from a partial final decree entered March 7, 1973.

Permission was granted to the Town of Hempstead to submit a separate brief in each appeal, as Amicus curiae, as the town was involved with the county in a program whereby each of these municipalities acquired various ocean front properties at Lido Beach for development as public recreational facilities. Additionally, the town, in furtherance of this program, acquired similar adjacent properties approximately four months after the county takings. The unit values established in these proceedings will necessarily have an important impact on the Malibu, Monaco, Sands and Coral Reef Beach Clubs involved in this program of condemnation. All the beach clubs involved in the taking by the county and the town were built during the period 1954 to 1956 and were operated in the same general fashion.

While these appeals have not been consolidated, nevertheless, on April 26th of this year, on the argument of the Shelborne appeal, it appeared to this court that it would be appropriate that that appeal be held in abeyance pending the consideration by this court of the decree in the Colony case. This court thereupon entered an interim order on June 13, 1973 to such effect (Matter of County of Nassau (Shelborne Beach Club), 42 A.D.2d 591, 344 N.Y.S.2d 1014).

Both appeals present common questions of law and fact. The briefs submitted by counsel have dealt with both properties generally. It appears appropriate, in view of the interaction of these cases upon each other, as well as upon the properties involved in the other takings, that we consider the matter in this single opinion.

The threshold question is whether the trial court utilized the appropriate theory of damages in making the awards. The examination of these appeals has not been simplified by the disparate positions of counsel with respect to defining the appropriate theory of damages applicable in this type of a taking. As above indicated, in the Shelborne case the county took no appeal, apparently willing to abide by the award of the trial court, regardless of whether the method of determining the award was legally permissible. The claimant in the Shelborne case likewise takes no exception to the summation method of appraisal therein employed. The trial court utilized this method, although properly denouncing it as inappropriate and decrying the failure of counsel to try the case upon a proper theory of damages. The result is that an award has been made on the summation theory of land value, plus depreciated building value, although the trial court ruled that the property lent itself to determination on the capitalization formula of income. The trial court found specifically that the highest and best use of the Shelborne property was as a cabana club, despite recognition of the uneconomic result of such use. The claimant in that case does not contest the the inappropriateness of the theory employed, but merely seeks, more money, claiming that it is entitled to a higher land value, such as was found by the trial court in the Colony case for the portion therein taken, as to which the trial court held that the highest and best use was for residential improvement.

In the Colony case, although the entire property of approximately 30 acres was employed as one unit for cabana club purposes, some areas more intensively than others, the trial court adopted a theory of duality of purpose and found, with respect to the lesser utilized 9.4 acres, that the highest and best use was for residential purposes. The trial court then determined that as to the remaining approximately 20 acres the highest and best use was for cabana club purposes and proceeded to utilize the summation method of appraisal, despite recognition that that method was inappropriate.

The claimant in that case takes the position that more of the property should have been appraised for residential use, which concededly has a higher value than the cabana club use; that a going-concern value should have been added to the award, as well as interest for an alleged De facto taking going back to October 1, 1967; and that the claimant should have been awarded the 'additional allowance' permitted in 'a difficult or extraordinary case', under CPLR 8303 (subd. (a), par. 2).

The county contends that the land value found by the trial court in the Colony case for the property, available partly for business and partly for residential purposes, was excessive and that the trial court failed to give effect, in its consideration of the improvement's value, to obvious economic and functional obsolescence. The county accordingly asks for reversal on the law and the facts.

The town takes the position with respect to both properties that the highest and best use is for residential subdivision, that the summation theory is totally impermissible, that the claimants are not entitled to compensation for loss of a going-concern value, that the trial court's awards were predicated upon an erroneous determination of the highest and best use and that a new trial should be granted in both proceedings.

We believe the position of the town is the only one supportable upon the records in both cases and that we must reverse and grant a new trial in each of these two cases upon the proper theory of damages, to wit, valuation of the properties as vacant residential.

A condemnation proceeding is not a private litigation. There is a constitutional mandate upon the court to give just and fair compensation for any property taken. This means 'just' to the claimant and 'just' to the people who are required to pay for it. The rule is abundantly clear that property must be appraised at its highest and best use and paid for accordingly. Where we find it is not, as we must necessarily do in this case, an improper theory of damages having been employed, we must remit for retrial upon the proper theory. This point is spelled out by counsel for the claimant in the Colony case, who correctly point out that in eminent domain the basis of the taking is the highest and best use, citing Sparkill Realty Corp. v. State of New York, 254 App.Div. 78, 4 N.Y.S.2d 679, affd. 279 N.Y. 656, 18 N.E.2d 301. The records in both the Colony and Shelborne cases clearly establish beyond peradventure that the highest and best...