State v. Casey, 38426

CourtSupreme Court of Minnesota (US)
Citation263 Minn. 47,115 N.W.2d 749
Docket NumberNo. 38426,38426
PartiesSTATE of Minnesota, by Miles LORD, its Attorney General, and his successor in office, Walter F. Mondale, Appellant, v. Thomas J. CASEY et al., Respondents-below, Mapco Sand and Gravel Company, Respondent.
Decision Date08 June 1962

Syllabus by the Court.

1. Where a portion of a tract of land is taken in condemnation proceedings, damage is measured by the difference in the market value of the entire tract before and after the taking. Any evidence is competent and any fact proper to be considered which legitimately bears upon the question of the market value of the property. Held, that where the depression of a highway forces the closing of the landowner's tunnel which connected his land on either side of the highway, this is not a mere police power regulation but is a taking for which compensation must be paid.

2. The landowner cannot claim inconsistent uses for land which was taken by condemnation nor can he show his particular plans and intentions. At the same time, however, he may show any uses, present or future, which are sufficiently practicable and probable as to be likely to influence the price which a present purchaser would give for the land. Held, under the record here, the testimony was properly received.

3. The landowner is not entitled to recover compensation from the state for damages which he could mitigate. However, the extent of the duty depends on the facts of each case, and whether evidence of possible mitigation of damages should be admitted must be left to the sound discretion of the trial court.

4. Whether a party should be allowed to reopen his case after resting, and the extent to which he may introduce evidence upon reopening, are matters within the discretion of the trial court.

Walter F. Mondale, Atty. Gen., Rolf O. Slen, Deputy Atty. Gen., Russell A. Sorenson, Sp. Asst. Atty. Gen., St. Paul, for appellant.

Meagher, Geer, Markham & Anderson, Mary Jeanne Coyne and O. C. Adamson, II, Minneapolis, for respondent.

FRANK T. GALLAGHER, Justice.

Appeal from an order of the district court which denied the motion of the appellant, State of Minnesota, for a new trial.

This case involves the condemnation for highway purposes of a strip of land owned by respondent Mapco Sand & Gravel Company. Prior to this action Mapco was the fee owner of 75.58 acres of land running along Xerxes Avenue in Edina and Bloomington. The tract was divided by West 78th Street (Highway No. 100), the right-of-way for which had been acquired by the state in 1926. That right-of-way varied from 80 to 110 feet in width, and the paved portion was about 24 feet wide.

From 1948 until the fall of 1953 Mapco used that part of its tract consisting of about 30 acres north of the highway as a gravel pit. Certain buildings used in conjunction with the mining of the gravel were constructed upon the north tract. By that time the mining on the north tract reached a level with Xerxes Avenue and Mapco ceased mining that tract. In 1954 it applied to the State Highway Depratment for permission to build a tunnel under the road which crossed its land. A permit was given authorizing the building of a tunnel and conveyor to allow the moving of gravel from the south tract, amounting to about 44 acres, to the north tract where it was to be processed. Mapco's mining operations from then on were confined to the south tract, which at the time of the trial was sufficiently elevated to allow, in the opinion of its owners, about 7 years more of mining before it would be level with Xerxes Avenue.

To provide room for a new freeway, the state brought condemnation proceedings to obtain a highway easement over 10.6 acres of Mapco's land in a strip about 550 feet wide which abutted the south edge of the old highway. It was proposed that the new freeway be about 40 feet below the level of the surrounding land. Commissioners were appointed in 1955 by the district court. On March 20, 1959, the commissioner of highways gave notice to Mapco to remove the conveyor system inasmuch as work was soon to begin on the new highway.

In their final report dated April 20, 1959, the court-appointed commissioners made an award of $148,000 to Mapco. The state and Mapco each appealed to the district court from that award. After a trial before a jury, a verdict was returned awarding Mapco $195,200.

The following testimony was introduced regarding damages which resulted from the taking: Harold D. Stafford, an officer of Mapco, testified that the reasonable market value of the whole tract, valued as one unit, was $650,000 on April 20, 1959, and that after the condemnation the value was $310,000, resulting in total damages of $340,000. However, the witness stated that those damages could be reduced to $150,000 by moving the washing plant of Mapco to the south side of the highway, where the latter intended to continue its gravel operations for about 7 years. To do this, however, would cost $120,000, which added to the reduced damages of $150,000 would make a total damage of $270,000.

Glenn Gullickson, a retired loan agent who had been engaged in real estate appraisals since 1913, testified concerning his valuation of that portion of the property which was zoned for commercial use--approximately 1,000 feet deep on the south side of 78th Street and 400 feet deep on the north side of 78th Street. He stated that the value of this land on April 20, 1959, was $239,900. He estimated the value of the remainder of this zoned strip after the taking to be $112.700, making a total damage of the zoned portion of $127,200. Mr. Gullickson did not attempt to estimate any damages which might result to the remainder of Mapco's land. Another appraiser, Thomas S. Maple, agreed with the figures given by Mr. Gullickson.

Dewey Newcombe, a professional real estate appraiser who testified on behalf of the state, valued the south tract for commercial purposes, disregarding the gravel operations, at $179,500 before the condemnation and $134,000 afterwards, or a total damage to that portion of $45,500.

Another realtor who testified for the state, Frederick H. Chute, estimated total damage to Mapco resulting from the taking at $47,000. He stated that the highest and best use of the south tract would be for commercial purposes, in the zoned area, though he admitted that he had not considered the possibility of further gravel operations.

After this testimony as to value, Mapco was permitted to reopen its case and Russell C. Smith, an appraiser, gave further evidence of value. He valued the entire tract as one unit for use in the mining operation now and eventual sale after 7 years as commercial building sites. He estimated the value before the taking at $611,700, and the value afterwards at $294,700, making a total damage of $317,000.

The state has assigned eleven errors which raise the following legal issues: (1) May the owner of the fee underlying a highway easement be awarded damages for the closing of a passageway under the highway constructed pursuant to a permit from the state when improvements to the highway make it necessary to close the passageway? (2) May an owner in a condemnation proceeding be awarded compensation for the part taken on basis of use as building sites and damages to remainder on basis of use as gravel pit? (3) Is an award of damages based on a plan for using the land for gravel operation with 7-year deferred use as building sites improper as being speculative and as going to plans and intentions of the owner? (4) Does 'reasonable diligence' in mitigation of damages require that a person do only what he has an absolute right to do? (5) Where the case has been reopened in chief, conditioned upon a limitation by the court of the number of experts to be allowed, is it an abuse of discretion to disregard the condition? Where no excuse, other than inadvertence of counsel, is offered for reopening the case in chief, does the reopening constitute an abuse of discretion?

1. Where a portion of a tract of land is taken in condemnation proceedings, the rule in this state is that damage is measured by the difference in the market value of the entire tract before and after the taking. State by Lord v. Pahl, 254 Minn. 349, 95 N.W.2d 85, and authorities cited; see, 1 Bonbright, Valuation of Property, p. 422; 42 Minn.L.Rev. 106, 118. Any evidence is competent and any fact proper to be considered which legitimately bears upon the question of the market value of the property. Conan v. City of Ely, 91 Minn. 127, 97 N.W. 737; Regents of University of Minnesota v. Irwin, 239 Minn. 42, 57 N.W.2d 625.

With these rules in mind, it is difficult to see why the closing of Mapco's tunnel would not be compensable under the record here. The market value of the property prior to the condemnation would undoubtedly include the value of the passageway. On the other hand, the market value after the tunnel was closed would be lower because the passageway would no longer be available for use in connection with the property.

The state claims, however, that the closing of the tunnel was merely an exercise of the state's police power and is not compensable, citing Cater v. Northwestern Tel.Exch. Co., 60 Minn. 539, 63 N.W. 111, 28 L.R.A. 310, and 3 Nichols, Eminent Domain (3 ed.) § 10.211(2). See, Jahr, Eminent Domain, § 3. While it is sometimes difficult to distinguish between the power of eminent domain and the police power, the question is essentially one of degree. Pennsylvania Coal Co. v. Mahon, 260 U.S. 393, 43 S.Ct. 158, 67 L.Ed. 322; 3 Stanford L.Rev. 303, 304. See Palmer, Manual of Condemnation Law, §§ 14 and 15, for Minnesota cases on both sides of the question.

The Minnesota Constitution since 1896 has provided that compensation must be paid whenever private property is 'taken, destroyed or damaged for public use.' Minn.Const. art. 1, § 13. Even though no land is taken, if damage to the property is extensive enough it...

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