N.Y. Cent. Lines, LLC v. State

• Decision Date: 19 December 2012
• Citation: 101 A.D.3d 966,957 N.Y.S.2d 252,2012 N.Y. Slip Op. 08704
• Parties: NEW YORK CENTRAL LINES, LLC, respondent-appellant, v. STATE of New York, appellant-respondent.
• Court: New York Supreme Court — Appellate Division

101 A.D.3d 966

957 N.Y.S.2d 252

2012 N.Y. Slip Op. 08704

NEW YORK CENTRAL LINES, LLC, respondent-appellant,

v.STATE of New York, appellant-respondent.

Supreme Court, Appellate Division, Second Department, New York.

Dec. 19, 2012.

Eric T. Schneiderman, Attorney General, New York, N.Y. (Richard Dearing and Simon Heller of counsel), for appellant-respondent.

Goldstein, Rikon & Rikon, P.C., New York, N.Y. (Jonathan Houghton of counsel), for respondent-appellant.

WILLIAM F. MASTRO, J.P., PETER B. SKELOS, ANITA R. FLORIO, and THOMAS A. DICKERSON, JJ.

In a claim to recover damages arising from, inter alia, a partial taking of certain real property, the State of New York appeals, as limited by its brief, on the ground of excessiveness, from so much of a judgment of the Court of Claims (Marin, J.), dated January 11, 2011, as, upon a decision of the same court dated August 26, 2010, made after a nonjury trial, in effect, awarded the claimant the principal sum of $12,104,106 in damages for the permanent takings in fee and by easement, and the claimant cross-appeals, as limited by its brief, on the ground of inadequacy, from so much of the same judgment as only awardedit this sum for the permanent takings in fee and by easement.

ORDERED that the judgment is affirmed insofar as appealed from, without costs or disbursements; and it is further,

ORDERED that the judgment is reversed insofar as cross-appealed from, on the law and the facts, without costs or disbursements, and the matter is remitted to the Court of Claims for a determination as to the appropriate corridor factor to apply to the $12,104,106 “across-the-fence” estimate of the value of the subject property as furnished by the claimant's expert, for the valuation and calculation of 5% of the market value of certain subject parcels of real property designated as Parcels 130A, 193F, 194J, and 195H, based on the “across-the-fence” value of these parcels as set forth in the claimant's expert's supplemental report, which shall include application of the appropriate corridor factor, representing direct damages for the State's taking of permanent easements over these parcels, and for the entry of an appropriate amended judgment thereafter.

In January 2000, the State of New York appropriated, partially in fee and partially through permanent easement, several parcels of the claimant's real property (hereinafter the appropriated property) for the purpose of expanding the Brooklyn–Queens Expressway. The appropriated property was part of a rail corridor owned by the claimant. In June 2000, the claimant filed a claim in the Court of Claims to recover damages for the taking of the appropriated property. The State appeals, on the ground of excessiveness, and the claimant cross-appeals, on the ground of inadequacy, from so much of the judgment of the Court of Claims, made after a nonjury trial, as awarded damages for the permanent takings, both in fee and by easement.

“The measure of damages in a case involving the partial taking of real property is the difference between the value of the entirety of the premises before the taking and the value of the remainder after the taking” ( Gyrodyne Co. of Am., Inc. v. State of New York, 89 A.D.3d 988, 989, 933 N.Y.S.2d 375;see Diocese of Buffalo v. State of New York, 24 N.Y.2d 320, 323, 300 N.Y.S.2d 328, 248 N.E.2d 155;Chester Indus. Park Assoc., LLP v. State of New York, 65 A.D.3d 513, 884 N.Y.S.2d 243). “The measure of damages must reflect the fair market value of the property in its highest and best use on the date of the taking, regardless of whether the property is being put to such use at the time” ( Gyrodyne Co. of Am., Inc. v. State of New York, 89 A.D.3d at 989, 933 N.Y.S.2d 375 [internal quotation marks omitted] ).

At a nonjury trial on the issue of damages, the claimant and the State each presented the testimony of experts with regard to valuation of the appropriated property. The experts agreed that the highest and best use of the appropriated property was as a rail corridor. They disagreed, however, as to the proper method for valuation.

The State's expert advocated a cost, or reproduction cost less depreciation, approach to valuation, which is employed in valuing “specialty” properties ( see generally Matter of Allied Corp. v. Town of Camillus, 80 N.Y.2d 351, 357, 590 N.Y.S.2d 417, 604 N.E.2d 1348;Matter of Al Turi Landfill, Inc. v. Town of Goshen, 93 A.D.3d 786, 941 N.Y.S.2d 177). However, the Court of Claims properly rejected this approach because, inter alia, the evidence demonstrated that the appropriated property did not constitute a specialty property. Additionally, the Court of Claims properly rejected the State's lump-sum reduction of the market value of the appropriated property to 15% of the estimated value. Since the opinion of the State's expert as to this particular issue was not supported with sufficient facts, figures, and calculations, his opinion in this regard lacked probative value ( see Matter of County of Dutchess [ 285 Mill St.], 186 A.D.2d 891, 891–892, 588 N.Y.S.2d 936;Matter of Northville Indus. Corp. v. Board of Assessors of Town of Riverhead, 143 A.D.2d 135, 136, 531 N.Y.S.2d 592).

“Having rejected the State's appraisal, the trial court was bound to either accept the claimant's appraisal or explain the basis for any departure” ( Gyrodyne Co. of Am., Inc. v. State of New York, 89 A.D.3d at 989, 933 N.Y.S.2d 375;see Matter of City of New York [ Reiss], 55 N.Y.2d 885, 886, 449 N.Y.S.2d 18, 433 N.E.2d 1266;Matter of City of New York v. Estate of Levine, 196 A.D.2d 654, 655, 601 N.Y.S.2d 620).

The claimant's expert, Charles W. Rex III, specialized in the appraisal of rail corridors. In offering his testimony and appraisal,he relied on, among other things, a number of scholarly articles on corridor valuation in support of his opinion as to the proper...