Mackie v. Watt

• Decision Date: 04 January 1965
• Docket Number: No. 16,16
• Citation: 132 N.W.2d 113,374 Mich. 300
• Parties: Petition of John C. MACKIE, as State Highway Commissioner of the State of Michigan, for condemnation fo private property for highway purposes in Clam Lake Township, Wexford County, Michigan, Petitioner, v. Thomas B. WATT and Gladys M. Watt, Respondents and Appellants.
• Court: Michigan Supreme Court

Page 113

132 N.W.2d 113

374 Mich. 300

Petition of John C. MACKIE, as State Highway Commissioner of the State of Michigan, for condemnation fo private property for highway purposes in Clam Lake Township, Wexford County Michigan, Petitioner, v. Thomas B. WATT and Gladys M. Watt, Respondents and Appellants.

No. 16.

Supreme Court of Michigan.

Jan. 4, 1965.

Jack W. Korn, Cadillac, Floyd T. Fuss, Saginaw, for appellants.

Frank J. Kelley, Atty. Gen., and Robert A. Derengoski, Sol. Gen., Lansing, for petitioner State Highway Commissioner.

Warner, Norcross & Judd, by Harold S. Sawyer, Wallson G. Knack, Grand Rapids, amici curiae.

Before the Entire Bench.

KELLY, Justice.

Three commissioners appointed by the trial court reported that appellants should receive $15,650 as compensation for petitioner taking appellants' property for highway purposes.

The trial court refused to confirm the award and appellants 'urge' this Court to 'find that the lower court committed error in refusing to confirm the award and that his order be reversed, with an order confirming the award.'

Appellants' property, consisting of approximately 20 acres, is located south of Cadillac, Michigan, and extends 660 feet north and south and 1,320 feet east and west.

For highway purposes and in furtherance of the Grand Rapids-Petoskey project, the State is taking approximately 1.3 acres by taking 87 feet of the 660 feet north and south boundary line on the east side of the property.

Old US-131 runs along the westerly line of the property and cuts across the northwest corner. The relocated new US-131 swings the highway east of the property.

There was constructed on this property a residence near the northwest corner, a 7-unit motel of which 3 units were not quite complete, together with 2 old buildings which were to have been converted into 2 more motel units near the southwest corner. Ther is a new dwelling house near the northeast corner, of good construction and modern in all respects, and sometimes rented as a motel unit.

Two expert witnesses testified for the owners, one placing a $73,100 before value and a $48,100 after value, and the other a $70,000 before value and a $43,000 after value. Both of these witnesses took into account the fact that the motel was situated on a main, well traveled tourist highway, with a high business potential and, also, that there would be meager business prospects after traffic diversion to the new road.

The State's expert witness testified to a $62,000 before value and a $61,900 after value, and did not consider diversion of traffic as a compensable item.

The trial court refused to confirm the $15,650 award, stating that the commissioners had largely based their award on a business potential loss due to a diversion of traffic and stating that as this was improper the recovery must be limited to the value of the land taken.

Appellants and appellee do not dispute that the law is well established to the effect that a motel owner cannot claim damages caused by a diversion of traffic, having no property or vested right in the traffic which flows over the highway, and that when a property owner improves property fronting on a highway he takes a calculated risk that the authorities may find it necessary in improving the highway system to build new facilities that will divert the traffic from passing in front of his property.

It is agreed by both appellants and appellee that the sole and novel question presented is: In computing the damage done to the owner of property abutting on a highway by the partial taking of his property in a condemnation proceeding, can the resultant diversion of traffic be considered as an element decreasing the value of his remaining property?

Appellee calls our attention to the States in which it has been held that the owner of property abutting on a highway is not entitled to damages for diversion of traffic where there has been a partial taking of his property. ¹

Appellants counter by listing 6 cases from 3 States (Alabama, Nebraska and Kansas) holding that if there is a partial taking the owner is entitled to damages for diversion of traffic. ²

Appellee endeavors to discount the weight of the Alabama and Nebraska cases by pointing out that the eminent domain clause of our 1908 Constitution (Art. 13, § 1) provides: 'Private property shall not be taken by the public * * * without * * * just compensation therefor being first made or secured in such manner as shall be prescribed by law,' whereas the Alabama Constitution adds after the word 'taken' the words 'injured, ro destroyed,' and the Nebraska Constitution reads in this regard 'shall be taken or damaged.'

Throughout the years this State has adhered to the principle that 'taking' must be given a broad construction and not a construction in a narrow sense, and in Pearsall v. Board of Supervisors of Eaton County, 74 Mich. 558, pp. 561, 562, 42 N.W. 77, pp. 77, 78, 4 L.R.A. 193, this Court held:

"The constitutional provision is adopted for the protection of and security to the rights of the individual as against the government,' and the term 'taking' should not be used in an unreasonable or narrow sense. It should not be limited to the absolute conversion of property, and applied to land only; but it should include cases where the value is destroyed by the action of the government, or serious injury is inflicted to the property itself, or exclusion of the owner from its enjoyment, or from any of the appurtenances thereto. In either of these cases it is a taking within the meaning of the provision of the constitution. * * *

"A partial destruction or diminution in value is a taking.' (Citing authorities)

'If the public take any action which becomes necessary to subserve public use, and valuable rights of an individual are [thereby] interfered with, and damaged or destroyed, he is entitled to the compensation which the constitution gives therefor, and such damage or destruction must be regarded as a 'taking."

In In re Slum Clearance, 332 Mich. 485, 492, 52 N.W.2d 195, 198, we stated:

"The constitution expressly forbids any appropriation of private property without 'just compensation.' There is no power in the legislature to create any exception to this rule, and nothing is just compensation which does not make good all the pecuniary loss or outlay occasioned to the owner by the appropriation of his property."

We also quote from In re John C. Lodge Highway, 340 Mich. 254, 262, 65 N.W.2d 820, 824, wherein we reiterated:

"'Nothing can be fairly termed just compensation which does not put the party injured in as good a condition as he would have been if the injury had not occurred.' In re Widening of Bagley Avenue, 248 Mich. 1, , 226 N.W. 688, 689."

The facts presented in this appeal are unusual, and that is probably the reason why similar facts in condemnation proceedings in re the construction of highways have not previously been before this Court.

Appellants state: 'In Riddle v. State Highway Commission (1959), 184 Kan 603 (339 P2d 301) we have a case almost exactly in point on the facts, and exactly in point as to law.'

In the Riddle Case there was a taking from the owners of a motel a parcel of property for the construction of a limited access highway, resulting in a diversion of traffic to the rear of their property so that the motel could not be seen except for the top of the roof, although the old road remained unchanged and the motel could still be reached by going 600 feet to the east or at a crossover 1 1/2 miles to the west. The State originally estimated damages at $16,629, but later instructed its appraisers to omit damages for denial of access to the new highway and loss of business or profits to the motel in their appraisal for the reason that those items were not compensable in condemnation proceedings, and so the original award was reduced by approximately $9,000. The owner claimed loss of business potential reduced the value of the property $20,500, whereas his witnesses testified to a reduction in value from $25,000 to $26,500.

The supreme court sustained a jury's award of $23,887. In so sustaining, the court stated (pp. 613, 614, 339 P.2d p. 310):

'Again, emphasizing that the lack of access to the new highway cannot be considered as a factor, because that right was nonexistent, nevertheless, the market value of the land remaining may be affected by the nature and extent of the taking, which might affect the reasonable probable uses to which the remaining land may be put, and that fact was a proper element for the jury to consider in determining damages to the land remaining.'

In this case, the concurring opinion of Mr. Justice Schroeder commented as follows (p. 641, 339 P.2d p. 329):

'It would further be fallacious to reason that because in a consequential damage case, where no property is taken from a landowner, there can be no recovery of damages for diversion of traffic, that this factor should be eliminated as an element in the determination of damages in a condemnation action where there is a direct invasion of the landowner's property.'

The question presented to this Court is: Shall we abandon the liberal principles that we have consistently adopted in the past in regard to the 'before and after' rule under facts such as are presented in this appeal?

Our answer to that question is that we will not, and will follow those States, even though they are in the minority, holding that other factors, such as are present in this appeal, which result in diminution in value of the land remaining after the partial taking may be considered in arriving at the compensation to be awarded.

The commissioners in making their award properly took this principle into consideration. There is no complaint about the action fo the commissioners in any other respect, and their award was between the high and low estimates as to the amount of damages sustained by appellants.

We conclude that the partial...