State v. Williams, 2--572A5

• Citation: 297 N.E.2d 880,156 Ind.App. 625
• Decision Date: 29 June 1973
• Docket Number: No. 2--572A5,2--572A5
• Parties: STATE of Indiana, Plaintiff-Appellant, v. Arthur Roy WILLIAMS and Ruth M. Williams, Defendants-Appellees.
• Court: Court of Appeals of Indiana

Page 880

297 N.E.2d 880

156 Ind.App. 625

STATE of Indiana, Plaintiff-Appellant, v. Arthur Roy WILLIAMS and Ruth M. Williams, Defendants-Appellees.

No. 2--572A5.

Court of Appeals of Indiana, Second District.

June 29, 1973.

Rehearing Denied July 25, 1973.

Theodore L. Sendak, Atty. Gen., Wesley T. Wilson, Deputy Atty. Gen., Indianapolis, for plaintiff-appellant.

William C. Barnard, James E. Hughes, Indianapolis, for defendants-appellees; Sommer, Tinkham, Barnard & Freiberger, Indianapolis, of counsel.

SULLIVAN, Judge.

This is an appeal by the State of Indiana from an award for damages in an eminent domain action in the Clinton Circuit Court. The State of Indiana filed an action in the Clinton Circuit Court to condemn a strip across the front of land owned by defendants for the improvement of Highway 28 and for a temporary easement adjacent to said strip for use in removing a restaurant building projecting into the strip condemned. The court appointed appraisers assessed defendants' damages at $20,750.00. Both parties filed exceptions to this report. Upon trial, the jury awarded and judgment was entered for defendants in the sum of $43,250.00, plus interest.

Defendant-appellees Arthur Roy Williams and Ruth M. Williams (hereinafter referred to as Williams) owned real estate in Frankfort, Indiana in fee and also leased land adjacent to their property from the Penn Central Railroad Company. ¹ Williams operated a drive-in restaurant business upon the combined tracts. The State condemned a portion of that property owned by the defendants but not the property leased from Penn Central. Evidence of the lease was admitted over the State's objection. Testimony concerning the profits of the business was also admitted over the State's objection but the court refused to allow an appraiser's testimony for the State tending to establish the value of the condemned real estate by using an appraisal method dependent upon capitalized income of the business. The State filed a motion to correct errors which was overruled by the trial court. Upon review, we are presented with the following issues:

1. Whether the testimony regarding property not owned by defendants was properly admitted?

2. Whether the gross sales of the business conducted on the condemned property was admissible?

3. Whether net profit figures of drivein restaurants in general and specific net profit figures of defendants' drive-in restaurant were admissible?

4. Whether the State's use of the capitalized income appraisal method was admissible?

5. Whether a tendered jury instruction was properly

refused? TESTIMONY REGARDING PROPERTY LEASED BY

DEFENDANTS WAS ADMISSIBLE AS LIMITED BY

INSTRUCTION TO JURY

First, the state argues that it is highly probable that the jury included in Williams' damages the value of the lease as fixed by the testimony allowed at trial. They interpret both State v. Heslar (1971) Ind., 274 N.E.2d 261 and Glendenning v. Stahley (1910) 173 Ind. 674, 91 N.E. 234 to hold that such an inclusion is improper. However, the facts in both cases were decidedly different than in the case before us. In Hesler, the Leased tract was condemned and the court was considering the effect of the leased condemned land upon adjacent leased property. (See also State v. Nelson (1973, Ind.Ct.App., 1st Dist.) 296 N.E.2d 908. Glendenning concerned the determination of the actual size of the tract that was damaged by the taking of a portion of the whole tract. Neither situation is before us. Williams, on the other hand, contends that the testimony as to the lease was proper to be considered by the jury in determining the fair market value of the condemned property.

Fair market value has been defined by our Supreme Court in Southern Indiana Gas & Electric Co. v. Gerhardt (1961), 241 Ind. 389, 393, 172 N.E.2d 204, 205 to be the following:

"The fair market value' is a determination of what the land may be sold for on the date of the taking if the owner were willing to sell. Anything affecting the sale value at that time is a proper matter for the jury's consideration in attempting to arrive at a 'fair market value."

The determination of market value is further explained by the following excerpt from 4 Sackman, Nichols' on Eminent Domain, § 12.314 (3rd Ed. 1971):

'A use for which a piece of land is especially available need not be excluded from consideration merely because the availability depends upon extrinsic conditions, the existence or continuance of which is not within the control of the owner of the land. Thus a lot near a railroad station may be especially valuable for the site of a retail store, although the company if it saw fit might move the station away. The possibility of removal is considered and discounted by prospective purchasers, and thus is one of the elements in arriving at market value, but the existence of the station and the probability that it will remain should not be disregarded in determining market value for the purposes of eminent domain any more than it would be by a purchaser. In fact, it is not necessary that the extrinsic improvement which will make the land specially available for a particular purpose be in existence when the land is taken, if the probability of its being constructed in the immediate future is so strong as to have an effect upon present market value. Thus, where the adaptability for a specific use depends upon the land being used in combination with lands belonging to other persons, such use may be shown if the possibility of such combinations is so great as to have a definite effect in enhancing the market value of the property.'

Thus, the effect of leased adjoining property may in some situations be properly considered when determining the fair market value of condemned property.

The State contends, however, that the court did not properly limit the testimony by advising the jury that they could not consider the actual value of the leasehold itself in determining the damage award. The record discloses that the State objected to the testimony concerning the leased property as follows:

'To which we will object to any testimony concerning any property other than the property that is owned by the two defendants here for the reason that that's the only property that the State is responsible to compensate for and that if other property was brought in would tend to confuse the jury and the issues and, for that reason, we object to the introduction of evidence.'

The court made the following ruling:

'I'm going to overrule this objection and permit limited testimony upon additional properties surrounding that actually taken by the main. The jury will be instructed at the conclusion of the trial on how and what grounds they may determine a verdict. The question may be answered and the future objections will be noted as having been objected to and motion to strike and exception taken and the overruling of the motion and so on.'

At the conclusion of the evidence, the following directive was included in the judge's instructions to the jury:

'The defendants, Arthur R. Williams and his wife may not be compensated or awarded damages for property that they do not own.'

The record also shows that the instructions were later reread to the jury. While we would perhaps agree that the above instruction could be rephrased so to be clearer and more helpful to the jury, we cannot say as a matter of law that the trial court did not sufficiently limit the effect the jury should give the testimony regarding the leased property. Murphy Auto Sales, Inc. v. Coomer (1953), 123 Ind.App. 709 [156 Ind.App. 630] at 724, 112 N.E.2d 589. See also Evansville & Terre Haute R.R. v. Montgomery (1882), 85 Ind. 494; Ver Hulst v. Hoffman (1972 Ind.Ct.App., 3rd Dist.) 286 N.E.2d 214; Coleman v. DeMoss (1969) 144 Ind.App. 408, 246 N.E.2d 483.

Additionally, there is nothing of record to indicate that the State attempted to further limit the impact of the particular testimony by the tender of an applicable jury instruction. The appellant is not permitted to remain silent in such circumstance and thereafter claim that the instruction given by the court did not sufficiently limit the jury's consideration to relevant elements with respect to damages. Hardebeck v. City of Anderson (1965), 137 Ind.App. 455, 209 N.E.2d 769. Although Berry v. State (1972 Ind.Ct.App., 1st Dist.) 287 N.E.2d 557 was a criminal appeal, its quotation from Barker v. State (1958), 238 Ind. 271, 150 N.E.2d 680 has general application and is appropriate:

"Counsel, knowing the court is omitting the instruction upon some point in the case, may not remain quiet and tender no instruction and afterwards claim the court erred. Such practice would be wrong and mischievous." (287 N.E.2d 557, 562)

Nor can we say, as argued by the State, that the jury award necessarily included a sum representing the value of the leased land as opposed to the value of the land condemned as it may have been enhanced by the leased premises. Union Mutual Life Insurance Co. v. Buchanan (1885) 100 Ind. 63 at 84.

The State alternatively contends that the lease lacks a compensable value because it was cancellable upon thirty days notice. This assertion is based upon the following statement found in State v. Heslar, supra, 274 N.E.2d at 264:

'An estate in land which could be cancelled at any time does not seem to be an interest which would have a compensable value in a condemnation suit.'

The State's assertion unjustifiably concludes that the jury did in fact include an amount in its award for the leased real estate per se. The record in its entirety does not support this contention.

It is not error to admit testimony as to non-owned property when the testimony is properly limited. See State ex rel State Highway Commission v. Gray (1970), 81 N.M. 399, 467 P.2d 725. Thus, we cannot conclude that there was error in admitting the testimony regarding the leased property as limited

by the jury instruction. GROSS...