Redevelopment Agency of City of Santa Monica v. Zwerman

• Decision Date: 08 February 1966
• Citation: Redevelopment Agency of City of Santa Monica v. Zwerman, 240 Cal.App.2d 70, 49 Cal.Rptr. 443 (Cal. App. 1966)
• Court: California Court of Appeals
• Parties: The REDEVELOPMENT AGENCY OF the CITY OF SANTA MONICA, California, Plaintiff and Respondent, v. Jacob ZWERMAN, Defendant and Appellant. The REDEVELOPMENT AGENCY OF the CITY OF SANTA MONICA, California, Plaintiff and Respondent, v. Harry WEISS and Ida Weiss, Defendants and Appellants (two cases). Civ. 27714, 28136, 28137.

Page 443

49 Cal.Rptr. 443

240 Cal.App.2d 70

The REDEVELOPMENT AGENCY OF the CITY OF SANTA MONICA, California, Plaintiff and Respondent, v. Jacob ZWERMAN, Defendant and Appellant.

The REDEVELOPMENT AGENCY OF the CITY OF SANTA MONICA, California, Plaintiff and Respondent, v. Harry WEISS and Ida Weiss, Defendants and Appellants (two cases).

Civ. 27714, 28136, 28137.

District Court of Appeal, Second District, Division 4, California.

Feb. 8, 1966.

Hearing Denied April 5, 1966.

Phill Silver, Hollywood, for defendants and appellants.

Robert G. Cockins, City Atty., and Robert D. Ogle, Asst. City Atty., Santa Monica, for plaintiff and respondent.

KINGSLEY, Justice.

Plaintiff instituted an action in eminent domain, seeking to condemn certain property of defendant Zwerman, located in Santa Monica. The case was consolidated for trial with similar actions against defendants Harry and Ida Weiss, in which plaintiff sought to condemn two parcels of land involved in the same development project. After a jury trial, verdicts were returned and entered fixing the sum of $57,500 as the fair market value of the Zwerman land and its improvements, $59,000 as the fair market value of one parcel of the Weiss land and $87,500 as the fair market value of a second parcel. Motions for new trials were made and denied; defendants have appealed from the judgments on the verdicts, contending that the sums allowed were inadequate.

The amounts of damages awarded by the jury very closely reflected the amounts set by plaintiff's expert witnesses, Clarke Ewing and John J. Gastlin. On the other hand, defendants' expert witness, G. Vern Snorgrass, evaluated each of the properties considerably higher than the jury award. He evaluated the Zwerman property at $85,000, one parcel of the Weiss property at $96,500, and the other parcel at $70,000.

Mr. Snorgrass testified that he made a study of the highest and best use of the property, which he concluded was for continued use as multiple residential purposes; that he used a cost of replacement approach to help him form an opinion of fair market value; and that he also used an income approach. Mr. Snorgrass also testified on behalf of defendants Harry Weiss and Ida Weiss claiming that, in making his evaluation, he used comparable sales, the cost of replacement approach, and the capitalization of income approach. He stated that he did not take into account properties east of Neilsen Way and Main Street because he believed these properties were of a different type neighborhood where there were heavy traffic areas. He also testified that he did not take into account the area east of Main Street as comparable sales, because there were no rear alleys in that area.

Mr. Ewing, one of plaintiff's experts, testified that he used a reproduction cost approach, that he analyzed income and gross return, that he determined the income of the subject properties and that he reduced property to an unfurnished basis. ¹ He also took into consideration the narrow streets and old condition of the neighborhood.

Mr. Gastlin, plaintiff's other expert, testified that he obtained an estimate of the costs of reproduction, that he made a summation cost estimate study and an income study and used the market data approach method. He stated that in forming his opinion of value he took into consideration the highest and best value. He also stated that he took into account the bad condition of and disrepair of the area and the narrow streets.

I

Defendants claim error in permitting the experts for plaintiff to testify, in support of their opinions as to value, as to a number of sales which they had treated as comparable, and as to certain assumptions made by them as to the highest and best use of the properties. However, except for the one matter hereinafter discussed, their briefs cite us to no place in the record where any objection was made to such testimony, nor to any motion to strike it, nor to any other act on their part in calling to the attention of the trial court the contentions which they seek to raise in this court. Our own examination of the record fails to disclose any such action. And, at oral argument before us, counsel for defendants admitted that he sought to raise these points for the first time on appeal.

Assuming that there might be a case in which a trial court had admitted evidence so clearly unfair as to shock the conscience of this court and lead it to consider a point not raised in the trial court, none of the contentions here urged on us fall within that category. Some are mere quibbles, others involve only what seems to us to be an argument that the court should have rejected plaintiff's testimony because defendants' testimony conflicted with it, while others, at best, involve problems in the definition of the term 'comparable sales'; any possible prejudice to defendants could have been corrected by an objection or motion in the trial court. The normal rule, which requires such action is here applicable.

II

Among the sales relied on by Mr. Gastlin, in forming his opinion as to value, were two probate sales. Defendants duly moved to strike this portion of his testimony, urging that probate sales are in the nature of 'forced sales' and therefore not 'comparable'. The motions were overruled.

Defendants rely chiefly on the holding in City of Los Angeles v. Deacon (1932) 119 Cal.App. 491, 493, 7 P.2d 378. But the holding there was not that evidence of the prices paid at probate sales were without evidentiary value--in fact the opinion expressly declares the relevancy of such data ² --but that, under the procedural rules then in force but now repudiated, ³ no evidence of any comparable sale was admissible on direct examination, the expert being limited, on direct examination, to the mere statement of his value estimate. The Deacon case was expressly disapproved in County of Los Angeles v. Faus (1957) 48 Cal.2d 672, 312 P.2d 680--the case which changed the older rule and allowed the expert to cite, on direct examination, the bases for his opinion. As we have pointed out, actually, the dicta in Deacon supports the ruling of the trial court.

Authority in other jurisdictions gives little support for defendants' position. In Dietrichs v. Lincoln & N. W. R. Co. (1881) 12 Neb. 225, 10 N.W. 718, cited by defendants, evidence of the price paid for the property involved at a probate sale was held inadmissible, not on the ground that it was a probate sale, but on the ground that the lapse of time since that purchase and the large appreciation in property values in the interim rendered that sale too remote to have evidentiary value. In March v. Portsmouth & Concord Railroad (1849) 19 N.H. 372, evidence of the price paid for the property at a reasonably recent probate sale was held admissible.

Apart from the statement, made without discussion of reasons, by a divided court in one Idaho case (State v. Styner (1937) 58 Idaho 233, 72 P.2d 699), and an ambiguous statement in Nichols on Eminent Domain, ⁴ we are cited to no authority holding that a probate sale is, per se, noncomparable; nor has out own research found any such authority.

On principle we can see no reason to exclude probate sales in arriving at an opinion as to value. The test for determining market value, long established in this state, is as follows:

'* * * the highest price estimated in terms of money which the land would bring if exposed to sale in the open market, with reasonable time allowed in which to find a purchaser, buying with knowledge of all of the uses and purposes to which it was adapted and for which it was capable.' (Sacramento Southern R. Co. v. Heilbron (1909) 156 Cal. 408, 409, 104 P. 979, 980.)

The law has regularly excluded reliance on true 'forced sales' such as those under execution, or under foreclosure, ⁵ but such sales involve the element not only of some haste, but of a compulsion on the part of the property owner to take whatever price is offered by the highest bidder, regardless of its relation to actual value or to the owner's willingness to accept that price. For the same reason, sales at auction, if the sale is 'without reserve' are 'forced' and inadmissible.

But a probate sale, in this state, has none of these characteristics. They are surrounded by elaborate statutory provisions to insure that the sale price is in accord with the value placed on the property by the inheritance tax appraisers (Prob.Code § 780 et seq.), the probate court being expressly enjoined to see that the sale price 'is not disproportionate to the value' (Prob.Code § 785). It is true that real property may be sold in the course of probate in order to raise cash, either for the payment of claims or to facilitate division of assets among the heirs or beneficiaries. But private sales not infrequently are made for similar reasons. In any case of reliance on a sale alleged to be 'comparable,' the other party may show any special circumstances which render the price atypical. But the fact that the sale was in probate does not, by itself, show that the price obtained was without value in determining the market value of other comparably situated property. Since defendants here object to the use of the two sales in question solely because they were in probate, and make no contention that they were...