Piz v. Housing Authority of the City and County of Denver

• Decision Date: 07 November 1955
• Docket Number: No. 17433,17433
• Citation: 289 P.2d 905,132 Colo. 457
• Parties: Oreste PIZ, Plaintiff in Error, v. The HOUSING AUTHORITY OF THE CITY AND COUNTY OF DENVER, a municipal corporation, Defendant in Error.
• Court: Colorado Supreme Court

Page 905

289 P.2d 905

132 Colo. 457

Oreste PIZ, Plaintiff in Error, v. The HOUSING AUTHORITY OF THE CITY AND COUNTY OF DENVER, a

municipal corporation, Defendant in Error.

No. 17433.

Supreme Court of Colorado, En Banc.

Nov. 7, 1955.

Rehearing Denied Dec. 5, 1955.

Fred M. Winner, Denver, Clement R. Hackethal, Lakewood, for plaintiff in error.

Clifford W. Mills, Donaldson, Hoffman & Goldstein, Denver, for defendant in error.

KNAUSS, Justice.

In the trial court the defendant in error, Denver Housing Authority, was plaintiff, and plaintiff in error Piz was defendant in an eminent domain proceeding wherein the Housing Authority sought to condemn the Piz property as part of a vast low cost housing project. After trial and a verdict, fixing the value of the Piz property, the trial court on motion of the Housing Authority dismissed the action over the objection of counsel for Piz. Piz brings the cause here on writ of error.

The undisputed facts as disclosed by this record are: In the year 1951 the Housing Authority of the City and County of Denver, Colorado, determined it would build a large low cost housing project and that it would, as a part of said project, acquire the property of plaintiff in error (hereinafter referred to as Piz). In the following year, 1952, the Housing Authority entered into engotiations with Piz for the purchase of his property which consisted of certain lots on Mariposa Street on which he had erected a structure which housed a bakery and certain dwelling units. For a period of twenty years Piz and his son continuously operated this bakery. They specialized in making French bread and hard rolls for the restaurant, hotel and club business in and around Denver. The manufacture of these products required specialized equipment, unfitted to most bakery uses. Among this special equipment was a massive sixty-one ton oven, which was erected on a three foot concrete block. It consisted of a steel frame, alongside of which special brick were laid and bonded together with a special mortar. An insulating barrier for this oven was composed of several tons of silica. During the many years of its operation the heat generated caused the bolts used in the steel frame to fuse so that the oven could not be moved. Evidence discloses that for this period of twenty years the oven had not been permitted to cool, and that had it been allowed to cool it would, for purposes of resale, be worthless separate and apart from the building. The Piz property also contained a refrigeration room used in connection with his business. This consisted of an apartment with twelve inch walls, the exterior of which was made of cinder block, the interior lined with an eight inch layer of cork. The floor of the refrigeration room was concrete over which a layer of cork was laid, and on top of the cork was another four inch slab of concrete. This room was cooled by built-in coils and plates, attached by permanent piping to a compressor located outside the room. The jury to whom the issue was submitted found from the evidence that the oven and the refrigeration room were fixtures and a part of the real estate sought to be condemned. The correctness of this special finding of the jury is not and cannot be disputed.

The Housing Authority in its negotiations for the purchase of the Piz property, prior to the institution of the condemnation action, offered Piz $27,500 for his property. Plaintiff in error insisted on a minimum payment to him of $50,000. The parties were unable to agree on the sum to be paid, and a negotiator for the Housing Authority advised Piz that if the Authority could not purchase the property at an agreed price, it would be condemned. The Housing Authority refused to raise its offer of $27,500, stating that it would not pay for the fixtures. After the condemnation suit was started the Authority applied to the trial court for an order for immediate possession of the Piz property. Witnesses for the Authority on this hearing testified that the entire area included in the proposed housing project was necessary therefor; that contracts pursuant to plans adopted had been let for the construction of the entire project; that a portion of the construction included in the contract was for improvements on the Piz property; that demolition of the adjacent properties was already in process, and that it was essential and necessary that the Piz property be acquired and immediate possession had in order to go ahead with the work on the project then in progress.

The trial judge denied the motion for immediate possession of the Piz property. Work proceeded on the other properties around and adjacent to the property of Piz, according to the plans and contracts of the Authority.

A jury trial of the issues in the Piz condemnation case was had in August, 1952, by which time the surrounding property had been acquired either by purchase or under orders for immediate possession under condemnation proceedings. On the trial there was little if any difference in the values as fixed by the appraisal witnesses called by the respective parties. The value of the land and improvements owned by Piz, exclusive of the oven and the refrigeration room, was fixed at $32,000 by all witnesses, including those offered by the Housing Authority. The jury was properly instructed and returned its verdict finding that the fair market value of the building, lands and fixtures was $58,860. Upon return of the verdict, the Authority was granted thirty days to file a motion for new trial. Apparently convinced there was no error in the record which would justify such a motion, the Housing Authority on the 29th day after the verdict was returned filed a motion to dismiss its proceeding against Piz.

Appropriate objection was made to the granting of this motion. It was claimed the Housing Authority was estopped to dismiss the condemnation proceeding because Piz had substantially changed and altered his position as a result of the condemnation suit; that with full knowledge of the Authority he had built a new plant to replace his bakery which was the subject matter of the action; that this new bakery was built solely because of the condemnation and the insistence of the Authority that the Piz property was absolutely essential to the project; that the attempted dismissal was not in good faith and was retaliatory because the Authority was dissatisfied with the award of the jury, and that it was dictated by the Public Housing Authority of Washington, D. C., and not by the Denver Housing Authority.

The trial court heard testimony in connection with the motion to dismiss. At that hearing it was admitted by the Authority that it knew Piz was building a new bakery. A witness for the Authority admitted that the Piz acquisition was the only one ever abandoned by the Authority over the objection of the property owner. It is manifest from the record that the Authority was well informed that Piz was building a new bakery and it cannot be doubted from the testimony that Piz was honestly of the belief that in due course his property would be acquired thru the condemnation proceedings, and if he did not protect the business he had established over a score of years, he would be out of business.

Among other matters found by the trial judge, we note the following: 'I don't think there was any reason for these people to rely on any statements of the Housing Authority as to what they were going to do. I think nothing has been shown that these statements weren't made in good faith. The Housing Authority intended, as far as the evidence goes, to pursue this remedy and take this property. Then when they discovered the amount of the award, they were unwilling to pay it. Piz built his new bakery in Lakewood in good faith, and in the belief that the Housing Authority was going to take his existing bakery in condemnation.' The trial court also found that 'The property of respondent was the only part of the housing project in this case which was abandoned and the decision to abandon was made after the recommendation of the Public Housing Authority to the Petitioner and with approval of the Public Housing Authority.'

The trial judge granted the motion to dismiss holding that no estoppel was shown. From the judgment of dismissal counsel for Piz bring the cause here.

The objective of the Housing Authority was the construction of a low cost housing project. It never abandoned this objective. It is frankly admitted by counsel for the Housing Authority that the Piz property is the only one in this vast enterprise which was abandoned, and it is manifest that the misfit situation was brought about merely because the Housing Authority was dissatisfied with the award of the jury.

Counsel for Piz concede that in the usual condemnation case, where the property owner has not changed his position in good faith reliance on the condemnation suit, the condemnor may abandon the action at any time prior to the time the rights of the parties are reciprocally vested, but insist this is not the usual case. It is here contended that the doctrine of estoppel in pais prohibits the abandonment of this case without the consent of Piz.

In Johnson v. Neel, 123 Colo. 377, 229 P.2d 939, 944, we held that the doctrine of estoppel in pais will always be applied to prevent fundamental injustice. There, Mr. Justice Moore, speaking for the court, stated: 'We are of the opinion that under the peculiar facts of this case the doctrine of estoppel in pais is applicable and controlling. This doctrine is founded upon principles of fair dealing and is designed to aid the law in the administration of justice where without its aid injustice might result. In 19 American Jurisprudence, page 640, we find the following statement: 'Generally speaking, however, equitable estoppel is a rule of justice which in its proper field prevails over all other rules.' The doctrine of equitable estoppel has been invoked to cut off...