State v. Parkey

• Decision Date: 01 November 1956
• Docket Number: No. 3390,3390
• Citation: 295 S.W.2d 457
• Parties: STATE of Texas et al., Appellants, v. William PARKEY et al., Appellees.
• Court: Texas Court of Appeals

Page 457

295 S.W.2d 457

STATE of Texas et al., Appellants, v. William PARKEY et al., Appellees.

No. 3390.

Court of Civil Appeals of Texas, Waco.

Nov. 1, 1956.

Rehearing Denied Nov. 28, 1956.

Henry Wade, Dist. Atty., John B. Webster, Asst. Dist. Atty., Dallas, for appellants.

McKool & Bader, Dallas, for appellees.

HALE, Justice.

Appellants, the State of Texas, County of Dallas and City of Carrollton, instituted this proceeding to condemn for highway purpose the leasehold interest of appelees, William Parkey and W. A. Smith, as lessees of a certain parcel of land and improvements thereon, situated in Carrollton. The Special Commissioners appointed to assess the damages resulting from such condemnation awarded the sum of $7,425. Appellees objected to the award on the ground that the amount thereof was insufficient. Thereafter, the court below permitted appellees, at their request, to withdraw from the registry of the court the sum of $7,425 deposited by appellants in compliance with the award made by the Special Commissioners. Appellants took possession of the leased premises on February 1, 1956. Appellees admitted in the trial court, in accordance with Rule 266, Texas Rules of Civil Procedure, that all legal prerequisites to condemnation had been complied with and that appellants were entitled to the recovery sought, except for the defense of appellees as to amount of damages they were entitled to receive.

The case was tried before a jury and upon the conclusion of the evidence, the court submitted to the jury one special issue as follows:

'What do you find from a preponderance of the evidence was the reasonable market value on February 1, 1956 in Dallas County, Texas of the leasehold interest of the defendants Parkey and Smith in the land described in their lease with C. W. Ramsey?'

The court instructed the jury as follows:

'You are instructed that by the leasehold interest of the defendants Parkey and Smith is meant the right to the use and occupancy of the land described in their lease from C. W. Ramsey for the balance of the lease term, upon the payment of the rental and the performance of the other terms of the lease.'

'You are instructed further that by the term 'reasonable market value of the leasehold interest', is meant the price the leasehold interest would bring when offered for sale by one who desires to sell but is not obliged to sell, and is bought by one who desires to buy but is under no necessity of buying.'

In response to the special issue as submitted, the jury found $20,000. Thereupon, the Court rendered judgment in favor of appellees for $12,575 as damages, that being the difference between the amount found by the jury and the amount theretofore awarded by the Special Commissioners to appellees and received by them.

Appellants predicate their appeal upon four points of error, in substance as follows: the court below erred (1) in overruling their objection to the testimony of the witness, Earl Womack, as to the market value of the property interest owned by appellees, and in overruling appellants' request that the court instruct the jury to disregard such testimony and strike it from the record on the ground that such testimony was shown to be the opinion of the witness of the reasonable rental value of the property interest, rather than its fair market value; (2) in admitting the testimony of the witness, William Parkey, setting forth the profits made by appellees in conducting their business on the leased property; (3) in refusing the request of appellants, after both sides had closed, to reopen the case for the purpose of permitting appellants to show that the purported exercise of appellees' option to extend the term of their lease was in fact a nullity; and (4) in refusing to include in its charge to the jury an instruction requested by appellants as to the measure of damages in the suit.

On and prior to September 17, 1952, C. W. Ramsey was the owner in fee simple of a parcel of land fronting along the southwest line of U. S. Highway No. 77 in the town of Carrollton. Situated on a part of his premises was a one story brick structure suitable for use as a drive-in store. The building was 60 feet in length along the highway by 30 feet in depth. On September 17, 1952, Ramsey entered into a written lease agreement with appellees, whereby he leased the property to them for a term of ten years from the date of the lease, to be occupied as a drive-in store for the sale of groceries and merchandise, appellees agreeing to pay therefore the sum of $20,100, payable $125.00 per month for the first year, $150 per month for the second year and $175 per month for the remaining eight years. The lease agreement was subject to certain conditions and covenants contained in 12 numbered paragraphs. The last paragraph in the lease provided that 'Lessee may extend this lease for a further term of ten (10) years at a rental of $175.00 per month, payable in like manner and subject to the same agreements as in this lease, provided Lessee gives written notice to Lessor by July 17, 1962, and Lessee is not in default, and this lease has not been otherwise sooner terminated.' C. W. Ramsey reached an agreement with appellants by which he conveyed to them for highway purposes the leased premises and adjoining lands owned by him, such conveyance having beem made prior to the time when this proceeding was instituted.

On the trial of the case, appellees placed Earl Womack on the witness stand, and on direct examination the witness testified that he was engaged in the real estate business, was familiar with the leased premises involved in the suit, had examined the lease agreement, and that in his opinion the reasonable cash market value of the leasehold interest belonging to appellees on February 1, 1956 was about $42,000. On cross examination the witness testified in part as follows: 'Q. Now, that figure of $42,000.00, is it your testimony that is what someone should be willing to pay to occupy that property for seventeen years? A. Yes, sir. Q. That is what someone should pay to occupy that property? A. That is right.' Immediately thereafter, counsel for appellants moved the Court to strike all the testimony of the witness from the record and instruct the jury to disregard it on the ground that 'the measure of damages here is not what the rental value of this property is for the coming seventeen years, but what someone would pay to the defendants for their leasehold interest.' The Court first stated in the presence of the jury that he thought the motion was meritorious but, after hearing argument from counsel for appellees, the Court then stated that he would take the motion under advisement, and after the witness had completed his testimony the motion was overruled.

(1, 2) In our opinion, the trial court should have promptly sustained the motion of appellants at the time it was presented to strike the testimony of the witness Womack relating to the measure of damages which might be recoverable by appellees herein, and to instruct the jurors not to consider the same. The ultimate question in the case was the amount of money which, if paid in cash on February 1, 1956, would have reasonably compensated appellees for the damages sustained by them as a result of the loss of their right to the continued use and occupancy of the leased premises in accordance with the terms of the lease agreement in controversy. As said by the Supreme Court of the United States in the case of United States v. Petty Motor Co., 327 U.S. 372, 66 S.Ct. 596, 90 L.Ed. 729, and again in the subsequent case of United States v. 425,031 Square Feet of Land, Jersey City, New Jersey, 3 Cir., 187 F.2d 978, where a complete leasehold is taken, as in this case, the measure of damages is the value of the use and occupancy of the leasehold for the remainder of the tenant's term, plus the value of the right to renew the lease, less the agreed rent which the tenant would pay for the use and occupancy, such values to be determined by the well established willing seller-buyer rule. See also Annotation, 3 A.L.R.2d 290 et seq.

(3) It is axiomatic that things equal to the same thing are equal to each other. Therefore, the necessary effect of the testimony of the witness Womack as it stood at the time when the motion was presented in the presence of the jury to strike out his testimony relating to values, was that the reasonable cash market value of appellees'...