Utah Dep't of Transp. v. Boggess-Draper Co.
| Decision Date | 11 June 2020 |
| Docket Number | No. 20180262,20180262 |
| Citation | 467 P.3d 840 |
| Parties | UTAH DEPARTMENT OF TRANSPORTATION, Appellant and Cross-Appellee, v. BOGGESS-DRAPER COMPANY, LLC, Appellee and Cross-Appellant. |
| Court | Utah Supreme Court |
Sean D. Reyes, Att'y Gen., James L. Warlaumont, Barbara H. Ochoa, Asst. Att'y Gens., Salt Lake City, for appellant and cross-appellee
Robert E. Mansfield, Megan E. Garrett, Salt Lake City, for appellee and cross-appellant
¶1 This is an eminent domain action involving a parcel of property owned by the Boggess-Draper Company, LLC (Boggess). In 2009 a portion of that parcel, situated along the I-15 corridor, was taken by the Utah Department of Transportation (UDOT) in connection with a project at 11400 South in Draper. In the litigation that followed, the parties disagreed on the quantum of damages for the condemned property and on the amount of severance damages to Boggess's remaining property. As the litigation proceeded, Boggess eventually sold the remaining property, which was developed into two car dealerships. Evidence of this subsequent development was excluded by the district court on a pretrial motion in limine on the ground that it was categorically irrelevant to the property's value in 2009. Citing Utah Code sections 78B-6-511 and -512, the district court held that the Boggess property had to be valued as of the date of the taking, and based only on what a willing buyer and seller would have known at that time. It thus endorsed a "general rule that a party may not rely on post-valuation facts and circumstances to prove severance damages."
¶2 We reverse. We reinforce the settled proposition that damages for a taking are to be assessed as of the date of the taking. And we uphold the general principle that the measure of damages in a case like this one is market value—what a willing buyer and a willing seller would consider in a voluntary transaction. But we hold that there is no categorical rule foreclosing the relevance of evidence of a subsequent transaction involving the property in question. And we reverse and remand for a new trial in accordance with the relevance standard we describe in greater detail below.
¶3 We also reject Boggess's position on cross-appeal—its assertion of a right to an attorney fee award as a constitutionally required element of its "just compensation" under article I, section 22 of the Utah Constitution. Boggess presents no originalist basis for its assertion of a constitutional right to attorney fees, and no adequate basis for overcoming our decision to the contrary in Board of County Commissioners v. Ferrebee , 844 P.2d 308 (Utah 1992). We accordingly conclude that it has failed to carry its burden of persuasion on this point.
¶4 This is an eminent domain action filed by UDOT in 2009. The case involves a portion of a parcel of property owned by Boggess and taken by UDOT in connection with its widening and reconstruction of 11400 South in Draper. Boggess sought compensation for the value of the taken property and severance damages for harm to its remaining property.
¶5 The case did not go to trial until 2018. By that point Boggess's remaining property had been sold and developed into two car dealerships—in a sale that took place in 2016.
¶6 Before trial Boggess filed a motion in limine asking the district court to exclude evidence of the 2016 sale, price, and subsequent development of its remaining property. The district court granted Boggess's motion. It noted that the date of valuation of Boggess's remaining property was December 17, 2009—the date the eminent domain action was filed. See UTAH CODE § 78B-6-512(1) (). And it concluded that evidence of a later transaction involving the property was "not relevant to determin[ing] the value of the property in 2009."
¶7 The district court cited Utah Code section 78B-6-512 for the propositions "that only values for the date of valuation are relevant" to the damages inquiry and "that other later-occurring facts that might affect valuation should not be considered in determining valuation." And it reasoned that allowing the jury to hear the later sales price could leave the jury "with the impression that the plaintiff has been fully compensated." For these reasons, the district court held that all evidence had to be presented through the lens of what a willing buyer and seller would have known, or could have predicted, as of the valuation date. And it granted Boggess's motion on this basis, while qualifying that if Boggess opened the door and made post-valuation-date facts relevant, UDOT would have the right to respond at trial.
¶8 In the course of the trial both parties put on experts to opine on the value of the taken property and on the severance damage to the remaining property. At various points Boggess's counsel and experts made statements relating to the remaining property's development potential and value1 —comments that prompted claims by UDOT that Boggess had opened the door to post-valuation-date facts under the district court's order. But each time the district court declined to allow UDOT to bring in evidence of the 2016 sale, reasoning that any probative value would be substantially outweighed by undue prejudice under Utah Rule of Evidence 403.
¶9 At the close of trial the court issued an instruction telling the jury to disregard "any reference in the evidence to the property's value at some later point in time or any reference to any subsequent sale or development of the property." The instruction also warned that "[f]ailing to do so might produce a verdict which is not based on the evidence in this case." Under this and other instructions, the jury entered a verdict awarding Boggess over $1.7 million—an amount encompassing its determinations of the fair market value of the taken property and severance damages to the remaining property.
¶10 Boggess later filed a motion requesting an award of its costs, expenses, and attorney fees incurred in the proceedings—based on article I, section 22 of the Utah Constitution. The district court denied the motion, citing Board of County Commissioners v. Ferrebee for the proposition that "just compensation" under article I, section 22 of the Utah Constitution refers to damages for the value of taken property and does not encompass a right to recover costs and attorney fees. 844 P.2d 308, 313–14 (Utah 1992).
¶11 UDOT filed this appeal, asserting that the district court abused its discretion in refusing to admit evidence of the 2016 sale and subsequent development of the property. Boggess filed a cross-appeal, contending that the district court erred in denying its motion for an award of costs and attorney fees under the Takings Clause of the Utah Constitution.
¶12 Three questions are presented for decision: (a) whether the district court erred in granting Boggess's motion in limine on the basis of a blanket rule barring "post-valuation facts and circumstances to prove severance damages"; (b) whether it erred in rejecting UDOT's assertion that Boggess opened the door to the admission of post-valuation-date evidence through the assertions of its counsel and experts at trial; and (c) whether it erred in denying Boggess's motion for an award of costs and attorney fees. We reverse on the first point, decline to reach the second, and affirm on the last.
¶13 Prior to trial the district court granted the Boggess motion in limine on the basis of a categorical rule prohibiting evidence of any sale or development of property after the date of its taking. And it rooted this rule in both the governing provisions of the Utah Code and controlling case law.
¶14 The district court found in Utah Code section 78B-6-512 a "law and policy that only values for the date of valuation are relevant." It thus deemed the statute to establish a rule that "later-occurring facts that might affect valuation should not be considered in determining valuation." The district court also invoked case law in support of its rule. It cited Redevelopment Agency v. Mitsui Investment Inc. for the "general rule" that "ordinarily evidence of subsequent occurrences is not admissible." 522 P.2d 1370, 1372 (Utah 1974).
¶15 We view the matter differently. We agree, of course, that the date of valuation is the time of the taking. But we find nothing in the code or in our case law to support the categorical rule endorsed by the district court. So we reverse its decision granting the motion in limine filed by Boggess.2
¶16 In the paragraphs below we first set forth the basis for our conclusion that the district court's categorical rule is contrary to the terms of the Utah Code, as informed by our rules of evidence. Then we establish that our case law is consistent with this view. And we close with the conclusion that the decision granting the Boggess motion in limine was a prejudicial one entitling UDOT to a new trial.3
¶17 The governing statutes provide for just compensation for property taken or damaged based on market value at "the date of the service of summons." UTAH CODE § 78B-6-512(1). They also state that a jury "may consider everything a willing buyer and a willing seller would consider in determining the market value of the property." Id. § 78B-6-511(2)(a).
¶18 The code thus establishes the date for measuring the market value of taken property. See id. § 78B-6-512(1) (). But it does not speak to the categories of relevant evidence that may be considered in assessing that value as of that date.4 Evidentiary relevance is not a statutory matter. It is a question governed by our...
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