Appeal by defendants-appellants from judgment and order
entered 19 May 2004 by Judge Beverly T. Beal in Mecklenburg County
Superior Court. Heard in the Court of Appeals 14 April 2005.
Christa C. Pratt and John P. Barringer for plaintiff-appellee.
Thomas D. Windsor for defendants-appellants.
TIMMONS-GOODSON, Judge.
Thomas Ertel (“Mr. Ertel”) and Candice Ertel (“Ms. Ertel”)
(collectively, “appellants”) were awarded $680,000.00 plus interest
for the taking by eminent domain of their 7.18 acre tract ofproperty and improvements in Mecklenburg County. Following the
jury's verdict, appellants filed a motion for a new trial. On 19
May 2004, the trial court entered judgment and denied appellants'
motion. For the reasons discussed herein, we affirm the judgment
and order of the trial court.
The facts and procedural history pertinent to the instant
appeal are as follows: In 2002, appellants were the owners of 7.18
acres of property situated in Mecklenburg County, North Carolina.
On 18 April 2002, the City of Charlotte (“City”) filed a
declaration of taking regarding the property, whereby City
exercised its eminent domain power to take and condemn the property
in order to expand Charlotte-Douglas International Airport. City
estimated the value of the property and its improvements, and, as
full compensation for the taking, City deposited the sum of
$650,000.00 with the Mecklenburg County Superior Court. On 17 May
2002, appellants filed an answer and demanded a jury trial on the
issue of compensation, contending that the fair market value of the
property exceeded the sum estimated and offered by City.
The case proceeded to trial the week of 12 January 2004.
Prior to trial, City moved the trial court to prevent appellants
from offering testimony regarding the fair market value of the
property from witnesses who based their opinion on the fair market
value of other condemned property in the area. The trial court
reserved its ruling on the issue until it had an opportunity to
determine the admissibility of each witness's testimony. At trial,
City offered testimony regarding the fair market value of theproperty from four witnesses: three expert witnesses in the area
of real estate and one lay witness. Appellants offered testimony
regarding the fair market value of the property from five
witnesses: three expert witnesses in the area of real estate, one
lay witness, and Mr. Ertel. The trial court prevented appellants
from offering testimony from the following four lay witnesses:
Paul Norman (“Norman”), William Thorne (“Thorne”), Leonard Horne,
Jr. (“Horne”), and Wade Goines (“Goines”).
The only issue submitted to the jury was the fair market value
of appellants' property. On 15 January 2004, the jury returned a
verdict establishing the fair market value of the property at
$680,000.00. The trial court thereafter entered judgment in favor
of appellants and denied appellants' motion for a new trial. On 7
June 2004, appellants filed notice of appeal with this Court.
The issues on appeal are whether the trial court erred by:
(I) excluding the testimony of Norman, Thorne, Horne, and Goines;
and (II) denying appellants' motion for new trial.
[1] Appellants first argue that the trial court erred by
excluding the testimony of Norman, Thorne, Horne, and Goines.
Appellants assert that the witnesses should have been allowed to
testify because of their familiarity with the property. We
disagree.
N.C. Gen. Stat. § 8C-1, Rule 701 (2003) provides as follows:
If the witness is not testifying as an expert,
his testimony in the form of opinions or
inferences is limited to those opinions or
inferences which are (a) rationally based onthe perception of the witness and (b) helpful
to a clear understanding of his testimony or
the determination of a fact in issue.
N.C. Gen. Stat. § 8C-1, Rule 403 (2003) provides as follows:
Although relevant, evidence may be excluded if
its probative value is substantially
outweighed by the danger of unfair prejudice,
confusion of the issues, or misleading the
jury, or by considerations of undue delay,
waste of time, or needless presentation of
cumulative evidence.
“[T]he balance struck by the trial court
[regarding the
admissibility of evidence] will not be disturbed on appeal absent
a clear showing the court abused its discretion by admitting, or
excluding, the contested evidence. A trial court abuses its
discretion when its decision 'lack[s] any basis in reason.'”
Warren v. Jackson, 125 N.C. App. 96, 99, 479 S.E.2d 278, 280 (1997)
(quoting
Judkins v. Judkins, 113 N.C. App. 734, 740, 441 S.E.2d
139, 142,
disc. review denied, 336 N.C. 781, 447 S.E.2d 424 (1994))
(internal citations omitted).
In the instant case, during
voir dire direct examination,
Norman provided his opinion regarding the fair market value of
appellants' property and explained that he was basing his opinion
on previous sales of properties located in the area. On cross-
examination, Norman testified that some of these properties had
been sold for the airport expansion project and under the threat of
condemnation. Norman further testified that he had recently sold
property of his own under threat of condemnation. On redirect
examination, Norman testified that he had other personal experience
in property sales, but that those sales had occurred between eightand fifteen years ago. The trial court thereafter excluded Norman
from testifying during the trial, concluding that Norman's
familiarity with
appellants'
property was limited, that his
“experience with sales of other property himself other than his
involving the airport authority is remote in time . . . [,]” and
that “[t]he danger exists . . . of [Norman] drawing upon his
experience in regard to the existence of the Airport Authority's
expansion in regard to forming an opinion.” The trial court thus
determined that the probative value of Norman's testimony was
“outweighed by the confusion of the issues and the prejudicial
effect because evidence about sales to the condemning party would
not be admissible.” Appellants contend that the trial court should
have allowed Norman to testify because he was familiar with
appellants' property and any improper basis for his valuation of
the property was a credibility issue to be explored by City on
cross-examination. We
disagree
.
In
State v. Johnson, 282 N.C. 1, 191 S.E.2d 641 (1972), our
Supreme Court examined the admissibility of evidence regarding
prior condemnation sales in a later condemnation proceeding. In
Johnson, after the State declared its intent to condemn over 268
acres of property owned by the respondents, the trial court held a
hearing to determine the fair market value of the respondents'
property. During the hearing, the trial court allowed the
respondents to introduce evidence of the purchase price of three
similarly-situated parcels of property also acquired by the State
through condemnation. On appeal, our Supreme Court held that itwas prejudicial error for the trial court to allow such evidence
into the record.
Id. at 23, 191 S.E.2d at 656. The Court noted as
follows:
The majority rule is “that evidence as to the
price paid by the same or another condemning
agency for other real property which, although
subject to condemnation, was sold by the owner
without the intervention of eminent domain
proceedings, is rendered inadmissible to prove
the value of the real property involved merely
because the property was sold to a prospective
condemnor.” The rationale is that a sale to a
prospective condemnor is in effect a forced
sale; that at best it represents a compromise
and consequently furnishes no true indication
of the price at which the property could be
sold in the open market to a “willing buyer”;
that the condemnor may pay more in order to
avoid the expense and uncertainty of the
condemnation proceeding, while the seller may
accept less in order to avoid the same or
similar burdens. This reasoning also applies
to amounts paid by a condemnor for neighboring
land taken for the same project -- however
similar the lands may be -- whether the
payment was made as the result of a voluntary
settlement, an award, or the verdict of a
jury.
In some jurisdictions it is held that evidence
of a sale otherwise competent is not
necessarily inadmissible because the purchaser
had the power of eminent domain. However, the
burden is upon the party who offers such
evidence to establish as a preliminary fact
not only that the respective properties are
comparable but also that the purchase was not
so influenced by compromise or compulsion as
to influence the price and therefore to
destroy its usefulness as a standard of
value. . . . [I]t is said that the burden of
establishing the admissibility of evidence as
to the price paid by a condemnor for other
similar property “is a heavy one.”
. . . .
It is our opinion that any sale to a
prospective condemnor is highly unlikely to bea fair test of market value, and that a
preliminary determination by the trial judge
that the sale was not tainted by compulsion or
compromise cannot establish it as a reliable
standard. As the Court of Appeals of Kentucky
said . . ., “We think that such an inquiry
into matters of motivation ventures too far
into the realm of speculation and is not a
satisfactory substitute for the rule of no
admissibility. We therefore adhere to the
latter rule.”
Id. at 22-23, 191 S.E.2d at 655-56 (citations omitted).
In the instant case, Norman's
voir dire testimony tended to
show that his opinion was based upon prior condemnation proceedings
involving either his own property or other properties in the area.
Those non-condemnation property transfers of which Norman was aware
or involved in occurred more than eight years prior to appellants'
condemnation proceedings, a time period the trial court found too
remote to establish relevancy. Thus, were Norman to testify, the
probative value of the evidence he offered regarding the fair
market value of appellants' land would be based upon prior
condemnation sales which, in light of
Johnson, are an improper
basis for valuing property in a current condemnation proceeding.
See also Light Co. v. Sloan, 227 N.C. 151, 154, 41 S.E.2d 361, 364
(1947) (“The market value of property is the price it will bring
when it is offered by one who desires, but is not compelled to sell
it, and is purchased by one who is under no necessity to buy it.”).
Furthermore, because our Supreme Court has noted that
“[c]ross-examination as to prices paid by [a] condemnor for other
tracts for the same project is improper[,]”
Barnes v. Highway
Commission, 250 N.C. 378, 395, 109 S.E.2d 219, 233 (1959), we arenot persuaded by appellants' contention that the propriety of the
basis of Norman's testimony goes to its credibility rather than its
admissibility
. Therefore, in light of the foregoing
, we conclude
that the trial court did not abuse its discretion by excluding
Norman's opinion regarding the fair market value of appellants'
property.
We note that the trial court similarly excluded Thorne from
testifying at trial after concluding “that his testimony would have
to be intertwined with the condemnation overshadowing the
process[,]” and that “it would be fundamentally difficult for him
to testify without something being said about the airport
condemnation and the cross-examination would be so limited . . . .”
During
voir dire direct examination, Thorne testified that he
believed appellants' property was worth $100,000.00 an acre, and he
explained that he reached this conclusion after examining seven
“comparable properties” during a transfer of his own property in
2002. However, Thorne also testified he “talked to people at other
airports that owned property that was going through this
process[,]” and that he “tried to sell [his] property [but]
couldn't because everybody knew that it was going to be taken so
[he] couldn't sell it.” During cross-examination, Thorne testified
that although he “started considering the value of [his] land when
[he] bought it[,]” the 2002 appraisal of his own property was in
response to condemnation proceedings brought by City in order to
obtain property for the airport expansion project. Thorne further
testified that he obtained the appraisal because his property wasunder the threat of condemnation, and he had since “settled” his
“property situation” with City. In light of the foregoing, we also
conclude that the trial court did not abuse its discretion by
excluding Thorne's testimony.
With respect to Horne, the trial court found that four years
prior to appellants' condemnation trial, Horne was involved in a
condemnation sale to the Department of Transportation. The trial
court further found that a two acre portion of Horne's property was
currently under contract for sale at $700,000.00. Although the
trial court noted that the prior condemnation sale was unrelated to
the airport expansion project and that Horne's two acre portion of
property was not being sold under threat of condemnation, the trial
court nevertheless prohibited Horne from testifying at trial,
concluding that appellants had failed to provide a proper
foundation “to show the similarity in the nature, location, and
condition of the . . . other properties with which [] Horne is
familiar to the land involved.” We conclude that the trial court
did not err.
“It is the rule in this State that the price paid at voluntary
sales of land, similar in nature, location, and condition to the
condemnee's land, is admissible as independent evidence of the
value of the land taken if the prior sale was not too remote in
time.”
Johnson, 282 N.C. at 21, 191 S.E.2d at 655. However, “the
land must be similar to the land taken, else the evidence is not
admissible on direct examination. . . . Only such parcels may be
compared where the dissimilarities are reduced to a minimum andallowance is made for such dissimilarities.”
Barnes, 250 N.C. at
394, 109 S.E.2d at 231.
Whether property involved in a voluntary sale
is sufficiently similar in nature, location
and condition to the property appropriated by
condemnation to admit evidence of its sale and
the price paid therefor as a guide to the
value of the condemned property is a question
to be determined by the trial judge in the
exercise of his sound discretion.
Highway Commission v. Coggins, 262 N.C. 25, 28, 136 S.E.2d 265, 267
(1964).
In the instant case, during
voir dire direct examination,
Horne testified that he had knowledge of the value of appellants'
property and that appellants were entitled to “between eighty and
a hundred thousand an acre for property like that.” However, on
cross-examination, Horne was unable to locate his own property on
a map of the airport expansion area, and he admitted that his
property was “off the map” of the airport expansion area. Horne
further testified that he had not sold property on or near the road
upon which appellants' property was located. Although Horne
testified that he was basing his opinion regarding the fair market
value of the property upon “what all the property in the
neighborhood is bringing[,]” Horne further testified that his
neighbors' property was also “at the same location” his property
was located -- “just off the map.” When asked whether he knew of
any property located on the same road and in the same area as
appellants' that had sold for $80,000.00 to $100,000.00 an acre,
“in a private sale not under threat of condemnation[,]” Horne
replied, “No, ma'am; I do not.” In light of the foregoing, weconclude that the trial court did not abuse its discretion by
excluding Horne's testimony because of the dissimilarities between
the property he based his opinion upon and appellants' property.
With respect to Goines, although the trial court noted that
Goines was familiar with appellants' property as well as other
property values, the trial court nevertheless concluded that
Goines' familiarity with the property values was insufficient “to
provide competent evidence in regard to the opinion on this
particular property.” Appellants contend that Goines was “the best
qualified of any witness offered” because of his “extensive
business dealings” in real estate matters. However, we note that
Goines concluded that appellants' property “would be worth seventy
to eighty thousand dollars an acre[,]” a value significantly
less
than the approximately $95,000.00 an acre ultimately awarded by the
jury. Therefore, assuming
arguendo that the trial court erred in
excluding Goines' testimony, we nevertheless conclude that
appellants have failed to demonstrate prejudice arising from the
alleged error.
In light of the foregoing conclusions, we hold that the trial
court did not err in excluding the testimony of Norman, Thorne,
Horne, and Goines. Accordingly, appellants' first argument is
overruled.
[2] Appellants next argue that the trial court erred by
denying their motion for a new trial. In support of this argument,
appellants reassert their contentions regarding the exclusion of
testimony from Norman, Thorne, Horne, and Goines. “A trial judge's discretionary order made pursuant to Rule 59
for or against a new trial may be reversed only when an abuse of
discretion is clearly shown.”
Hanna v. Brady, 73 N.C. App. 521,
525, 327 S.E.2d 22, 24,
disc. review denied, 313 N.C. 600, 332
S.E.2d 179 (1985). “[A]n appellate court's review of a trial
judge's discretionary ruling either granting or denying a motion to
set aside a verdict and order a new trial is strictly limited to
the determination of whether the record affirmatively demonstrates
a manifest abuse of discretion by the judge.”
Worthington v. Bynum
and Cogdell v. Bynum, 305 N.C. 478, 482, 290 S.E.2d 599, 602
(1982). “During review, we accord 'great faith and confidence in
the ability of our trial judges to make the right decision, fairly
and without partiality, regarding the necessity for new trial.'”
Burgess v. Vestal, 99 N.C. App. 545, 550, 393 S.E.2d 324, 327
(quoting
Bynum, 305 N.C. at 487, 290 S.E.2d at 605),
disc. review
denied, 327 N.C. 632, 399 S.E.2d 324 (1990). In the instant case,
we have reviewed the record and we conclude that the trial court
did not abuse its discretion by denying appellants' motion for a
new trial. Accordingly, appellants' final argument is overruled.
In light of the foregoing conclusions, we affirm the trial
court judgment awarding appellants $680,000.00 for their property
and the trial court order denying appellants' motion for new trial.
Affirmed.
Judges CALABRIA and GEER concur.
*** Converted from WordPerfect ***
