State ex rel. State Highway Commission v. Mount Moriah Cemetery Ass'n

• Decision Date: 12 November 1968
• Docket Number: No. 2,No. 53564,53564,2
• Citation: State ex rel. State Highway Commission v. Mount Moriah Cemetery Ass'n, 434 S.W.2d 470 (Mo. 1968)
• Parties: STATE ex rel. STATE HIGHWAY COMMISSION, Respondent. v. MOUNT MORIAH CEMETERY ASSOCIATION, Appellant
• Court: Missouri Supreme Court

Page 470

434 S.W.2d 470

STATE ex rel. STATE HIGHWAY COMMISSION, Respondent. v. MOUNT MORIAH CEMETERY ASSOCIATION, Appellant.

No. 53564.

Supreme Court of Missouri, Division No. 2.

Nov. 12, 1968.

Motion for Rehearing or to Transfer to Court En Banc Denied

Dec. 9, 1968.

Robert L. Hyder, Earl H. Schrader, Jr., Tom M. Raimo, Kansas City, for respondent.

Samuel J. Molby, Robert C. Canfield, Kansas City, for appellant, Watson, Ess, Marshall & Enggas, Kansas City, of counsel.

HYDE, Special Commissioner.

Condemnation for state highway purposes of land owned by defendant Cemetery Association. The jury found defendant's damages to be $90,000 while the amount claimed by defendant was over $950,000.00, which difference gives this court jurisdiction.

Defendant operates a garden-type cemetery for profit. It owns 220 acres and has been selling grave spaces since 1922. 180 acres were included in its plan of development with 40 acres used for other purposes. At the time of the trial all the grave spaces sold were on the south 80 acres. The north 100 acres through which the highway right of way was condemned had been platted but not yet used for burials. The following facts were stipulated: Between the opening of the cemetery in 1922 and the date of taking for the highway in 1963 the average number of grave spaces sold per year was 1300; the average gross sales price per space received was $150.00 and the average net profit per space was $90.00 after deducting all expenses and provision for perpetual care; before the taking there were 69,515 unsold available grave spaces which would require 53 years to sell at the rate of 1300 per year; the highway took 27.3 acres and required 150 feet setback from the right-of-way line which took 25,912 available grave spaces, leaving 43,603 spaces which would require 34 years to sell at 1300 per year; and that the highest and best use of the property taken was for cemetery purposes.

Defendant claims that State of Missouri ex rel. State Highway Commission of Missouri v. Barbeau, Mo.Sup., 397 S.W.2d 561 established a formula for computing damages for taking cemetery land on a capitalization basis, using the Inwood Tables. Defendant says the Barbeau formula is to be applied as follows:

'(1) Determine the number of burial lots or grave sites taken;

'(2) Determine the unit value, which is

(a) The average sales price per lot or site in the adjoining used section of the cemetery, less

(b) The reasonable cost of development, sales, maintenance, administration, perpetual care, and any other expenses affecting its value;

'(3) Multiply the number of lots or sites taken by the unit value determined; and

'(4) Discount the total to present worth for the deferred realization over the selling period.'

Defendant further says since these facts involved, as well as the selling period of the lots, were stipulated, 'the sole question of fact remaining for jury determination was the proper discount factor.' Defendant's computations on different discount factors was based on interest rates it received on the investments of its permanent care fund and on rates paid by savings and loan associations. The State claimed a ten per cent rate should be used on the basis of risk of operation of a cemetery. The State's computation was $38,376.00 based on the theory that defendant's damage would not actually occur for 34 years from the date of taking (because enough spaces were left to last 34 years selling at the rate of 1300 per year).

Defendant's computation was as follows
                                            "Before Value
                                            -------------
                Number of Lots                 69,515
                Unit Value                        $90
                                            -------------
                Value of Total Lots Before                 $6,256,350.00
                                             After Value
                                            -------------
                Number of Lots Remaining       43,603
                Unit Value                        $90
                                            -------------
                Value of Lots After                         3,924,270.00
                                                           -------------
                   Value of Land Taken                     $2,332,080.00
                                                           -------------
                   Discounted on 3% Basis                  $1,150,425.00  Damages
                   Discounted on 4% Basis                     954,057.00  Damages
                   Discounted on 10% Basis                    433,388.00  Damages"
                

Defendant assumes State ex rel. State Highway Commission v. Barbeau, supra, requires submission of this case on the capitalization formula used in that case. However, that case was tried by the court without a jury so no instructions were involved. We pointed out (397 S.W.2d l.c. 566) that, in our review of court-tried cases, 'the judgment shall not be set aside unless clearly erroneous' Civil Rule 73.01(d), V.A.M.R.; and we affirmed the judgment therein reached by that method as to the lots taken as not unreasonable under the circumstances of that case. Thus the Barbeau case does not mean damages in cemetery cases must always be computed in exactly the same way they were in that case. Certainly consideration can be given to other factors such as possible increase in operation costs and decrease in demand for burial space in the location involved. As was stated in Cementerio Buxeda v. People of Puerto Rico (U.S.C.A.1st) 196 F.2d 177, 181, while it is proper to instruct the jury as to the capitalization method of valuation: 'This is not to say that valuing the parcel is merely a problem in multiplication.'

However, defendant's claims of error are that it was error to give Instructions 3 (M.A.I. 9.02) and 4 (M.A.I. 15.01), requiring the jury to use the usual fair market value tests and standards. Defendant cites Graceland Park Cemetery Co. v. City of Omaha, 173 Neb. 608, ...