Board of Transportation v. Jones , 297 N.C. 436 ( 1979 )

255 S.E.2d 185 (1979) 297 N.C. 436

BOARD OF TRANSPORTATION
v.
Ella Mae Ingram JONES.

No. 110.

Supreme Court of North Carolina.

June 12, 1979.

Atty. Gen. Rufus L. Edmisten by Asst. Atty. Gen. Robert W. Newsom, III, Raleigh, for plaintiff.

Johnson, Gamble & Shearon by Richard O. Gamble, Raleigh, for defendant.

COPELAND, Justice.

For the reasons stated below, we reverse the decision of the Court of Appeals.

The Court of Appeals first held that plaintiff was entitled to a new trial because of the trial court's failure to strike the testimony of one of defendant's expert witnesses. We do not agree.

Mr. W. R. Rand was a witness for the defendant at trial. After being found by the court to be an expert in the field of real estate appraisal, he testified that his estimate of the fair market value of defendant's entire property, including improvements thereon, prior to the taking was $755,737. The witness then testified that in his opinion the fair market value of defendant's remaining property after the taking was $444,847.

As Mr. Rand began explaining the bases for his estimates, it became apparent that he arrived at his valuation of the property after the appropriation by assessing and totalling all the damages he felt were caused by the condemnation, which in this case he estimated to be $310,890, and then subtracting that amount from his original appraisal of the value of the entire property before the taking. The plaintiff moved to strike the expert's testimony on the ground that his method of valuation was in conflict with G.S. 136-112(1). Its motion was denied.

G.S. 136-112 states in pertinent part:

"The following shall be the measure of damages to be followed by the commissioners, jury or judge who determines the issue of damages:

(1) Where only a part of a tract is taken, the measure of damages for said taking shall be the difference between the fair market value of the entire tract immediately prior to said taking and the fair market value of the remainder immediately after said taking, with consideration being given to any special or general benefits resulting from the utilization of the part taken for highway purposes." (Emphasis added.)

It is important to note that the statute speaks only to the exclusive measure of damages to be employed by the "commissioners, jury or judge." It in no way attempts to restrict expert real estate appraisers to any particular method of determining the fair market value of property either before or after condemnation. See generally State Highway Commission v. Conrad, 263 N.C. 394, 139 S.E.2d 553 (1965) (expert witnesses given wide latitude regarding permissible bases for opinions on value).

"Three alternative formulas are recognized for measuring just compensation in partial-taking cases: (i) The value of the part taken rule; (ii) Value of the part taken plus damages to the remainder rule; and, (iii) The before and after value rule. . . . The distinction between the second and third formulas is narrow, but the important point here is that they are alternatives. Therefore, it would be inappropriate to instruct the jury as to both formulas . . . . This does not mean that evidence of the value of the lands taken plus damages to the remainder is not admissible. In fact, is is appropriately considered by appraisers as two of the many guides for determining ``before and after values.' For example, all the appraisers in this case followed that procedure." Young v. Arkansas State Highway Commission, 242 Ark. 812, 814-15, 415 S.W.2d 575, 577 (1967). (Emphasis in original.)

Therefore, if there is a jury trial on the issue of compensation in a partial taking case, such as in this one, the trial court is required to instruct the jury only on the before and after value rule set forth in G.S. 136-112(1). If he were to instruct on that method and also on the value of the part taken plus damages to the remainder theory, the jury may be misled into believing that "after they had determined the ``before and after' value they could also take the diminution in the value of the remainder into consideration." Mississippi State Highway Commission v. Hall, 252 Miss. 863, 874, 174 So.2d 488, 492 (1965). See also Wheeler v. State Highway Commission, 212 Miss. 606, 55 So.2d 225 (1951). This erroneous process would result in double compensation for some damages. This Court has noted that evidence regarding the adverse effects of the condemnation on the remaining property is admissible, but such effects "are not separate items of damage, recoverable as such, but are relevant only as circumstances tending to show a diminution in the over all fair market value of the property." Gallimore v. State Highway and Public Works Commission, 241 N.C. 350, 355, 85 S.E.2d 392, 396 (1955).

Mr. Rand in this case gauged his appraisals of defendant's property in terms of the fair market value of the property before and after the taking. He then explained how he arrived at his estimates, which he was entitled to do. The fact that he used a particular method, value of the part taken plus damages to the remainder, to arrive at his estimate of the fair market value of the property after the taking did not render his testimony incompetent. The trial court instructed the jury only on the before and after value method to compute defendant's damages. The court did not repeat in its charge any of the individual damages that were testified to, thus making it very unlikely the defendant was overcompensated by the jury's award. See Mississippi State Highway Commission v. Hall, supra. Plaintiff's motion to strike Mr. Rand's testimony was correctly denied.

The Court of Appeals also held that the trial court erred in not instructing the jury on general benefits, even though it did charge on special benefits.

"[S]pecial benefits are those which arise from the peculiar relation of the land in question to the public improvement. . . [G]eneral benefits are those which result from the enjoyment of the facilities provided by the new public work and from the increased general prosperity resulting from such enjoyment." Templeton v. State Highway Commission, 254 N.C. 337, 341, 118 S.E.2d 918, 922 (1961). (Citation omitted.) Plaintiff claims the following testimony by one of its witnesses constituted evidence of general benefits:

"I determined that the land lying east of the Beltline had been enhanced due to the easy access to other areas of Wake County, and it's my opinion that this would escalate the development of that property and decrease the time necessary to develop it. I placed a value of $3,750.00 per acre on the tract of land lying east of the Beltline after the taking, which is an increase of $500 per acre.

I included everything east of the road in that category. The land valued at $3,750.00 an acre afterwards includes the 4.39 acres lying to the south side of Poole."

From an examination of the above testimony, it is clear that the witness was referring only to the defendant's land. His reference to "everything east of the road" meant that he felt both of defendant's tracts lying east of the projected Beltline were included in his estimate of enhanced property value due to the construction of the highway.

It is true that the type of benefit to which the witness was testifying—easy access to other areas of Wake County—would normally be enjoyed by other landowners in the area. Yet this does not appear to be necessarily so. For example, other property may have no reasonable access to the proposed highway. The only evidence in the record that even refers to other property in the area came from Mr. Rand, defendant's witness, who stated that "[t]here wasn't anything within 15-20 miles of that piece that was comparable to it, not with that road coming to it."

The burden of proving general and special benefits was on the plaintiff in this action, and we have stated that the trial court should not charge on such if their existence is merely speculative or uncertain. Kirkman v. State Highway Commission, 257 N.C. 428, 126 S.E.2d 107 (1962). The trial court did not err in this case by not instructing the jury on general benefits.

The plaintiff contends the trial court erred in its instructions to the jury on benefits in that it failed to adequately define that concept or to distinguish between general and special benefits. This Court has said that "[t]he failure to define more fully the meaning of general or special benefits or to distinguish between them, in the absence of timely request, may not be held for error." Simmons v. North Carolina State Highway & Public Works Commission, 238 N.C. 532, 535, 78 S.E.2d 308, 311 (1953). Plaintiff made no such request; this assignment of error is without merit.

For the reasons stated above, the trial court is affirmed and the decision of the Court of Appeals is

REVERSED.

BROCK, J., did not participate in the decision of this case.