Williams v. Eilers ( 2015 )

Williams v. Eilers et al., No. 802-12-13 Wncv (Tomasi, J., Sept. 28, 2015).
[The text of this Vermont trial court opinion is unofficial. It has been reformatted from the original. The accuracy of the text and the
accompanying data included in the Vermont trial court opinion database is not guaranteed.]
STATE OF VERMONT
SUPERIOR COURT CIVIL DIVISION
Washington Unit Docket No. 802-12-13 Wncv
Rebecca Ann Williams,
Plaintiff
v.
Craig A. Eilers,
Amy M. Buths Eilers,
Owen A. Wimble,
Owen A. Wimble,
Gordon A. Marcelle,
Gordon A. Marcelle,
Defendants
Opinion and Order on Defendants’ Motion to Exclude Expert Testimony
Plaintiff has brought various claims against the Defendants alleging, inter
alia, that they harvested timber on Plaintiff’s property without lawful authority.
Plaintiff designated Arborist Michael Fallis as an expert concerning damages.
Defendants all moved to exclude his testimony and sought a “Daubert hearing” to
challenge the bases for his expert opinion. The Court held a Daubert hearing on
September 21, 2015. Based on that hearing, the Court makes the following
determinations.
The Standard for Admitting Expert Testimony
The Vermont Supreme Court has adopted the Daubert line of authority to
determine the admissibility of expert testimony under Vt. R. Evid. 702. Daubert v.
Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993). As applied in Vermont, the
Daubert inquiry is intended to liberalize admissibility while ensuring that the
testimony is helpful for the finder of fact and that the expert’s methods are reliable.
The non-exclusive list of factors applicable to scientific testimony includes: “(1)
whether the theory or technique involved is capable of being tested; (2) whether the
theory or technique has been subjected to peer review and publication; (3) the
known or potential error rate associated with the scientific technique; and (4)
whether the theory or technique has been generally accepted in the scientific
community.” State v. Pratt, 2015 VT 89, ¶ 17 (citing State v. Streich, 163 Vt. 331,
343 (1995)).
Although Daubert addressed scientific testimony, the Court’s gatekeeping
function applies equally to nonscientific or other types of expert testimony. Pratt,
2015 VT 89, ¶¶ 18–19. In the case of nonscientific testimony, the court may apply
the Daubert factors or any others specific to the area of expertise at issue, in a
“flexible, nonmechanical” way. Id. at ¶ 25. This can include relying on the expert’s
qualifications and experience alone. Fed. R. Evid. 702, Advisory Committee
Notes—2000 Amendment (noting that “experience alone—or experience in
conjunction with other knowledge, skill, training or education—may . . . provide a
sufficient foundation for expert testimony”). In all cases of proffered expert
testimony, the Court’s primary goal is to ensure that the evidence is “properly
grounded, well-reasoned, and not speculative before it can be admitted.” Id.; see
also 29 Victor James Gold, Federal Practice and Procedure: Evidence § 6266 (noting
that the “validity of an expert’s explanatory theory depends [in part] . . . on
consideration of logic and common sense”).
Overall, the Vermont Supreme Court has “focused on the ‘liberal thrust’ of
Rule 702, stating that ‘the trial court’s inquiry into expert testimony should
primarily focus on excluding ‘junk science’—because of its potential to confuse or
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mislead the trier of fact—rather than serving as a preliminary inquiry into the
merits of the case.” Pratt, 2015 VT 89, ¶¶ 18–19 “So long as scientific or technical
evidence has a sound factual and methodological basis and is relevant to the issues
at hand, it is within the purview of the trier of fact to assess its credibility and
determine the weight to be assigned to it.” Id. at ¶ 30; see 985 Associates, Ltd. v.
Daewoo Electronics America, Inc., 2008 VT 14, ¶ 16, 183 Vt. 208, 217–18 (cautioning
trial courts against misusing the reliability prong of the Daubert analysis to deny
parties the opportunity of presenting their expert evidence to the trier of fact).
The Fallis Opinion
At the outset of the Daubert hearing, the Defendants indicated that they
were not challenging Fallis’ credentials as an expert tree appraiser. Fallis has been
a certified arborist since 1997, is a past or present board member of at least two
arborist groups, is a certified tree risk assessor, engages in ongoing arborist
trainings, and has offered opinions as to timber values in other cases. As a result,
the Court accepts him as an expert in timber valuation in this case.
Fallis testified at the Daubert hearing and his written report concerning the
subject property was also entered into evidence. Fallis testified that he had
examined the Plaintiff’s property and had developed an opinion as to the value of
the trees allegedly cut down on her property by the Defendants. Fallis opined in his
expert report and at the Daubert hearing that he estimated the value of the trees
that were removed from Plaintiff’s land to be $560,000.
Fallis explained that he had relied for his methodology on one of the methods
contained in the Guide for Plaint Appraisal (the “Guide”), which he acknowledged
was the principal authoritative treatise governing the appraisal of timber.
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Specifically, he used the “Cost Approach,” which included examination of the
“Trunk Formula Method.”
He stated that the Guide contained three main methodologies that may be
employed to value timber. He explained that he did not use the “Market Approach”
because that focuses primarily on the amount of value that the lost trees
contributed to the land. In short, if one were selling the property how much less of
a market value would it have as a result of the absence of the trees. Fallis indicated
that the Market Approach made little sense here because Plaintiff is not selling the
property and because, in his view, it would not put Plaintiff in the position she
would have been in had the allegedly improper conduct not occurred.
He stated that the “Income Approach” to valuation also would not be
appropriate in this context. That method is focused on income-producing property
and the amount of lost income that could be attributed to the trees. Since Plaintiff’s
property is not income producing, Fallis testified that this method could not
reasonably be employed.
Fallis testified that, in his opinion, the Cost Approach made the most sense in
this case. Plaintiff claims that the trees were wrongfully taken and that estimating
the cost to put Plaintiff back in the position she would have been in if the trees had
not been taken would be appropriate in such circumstances. That conclusion was
reinforced by his determination that the trees were important to Plaintiff, had
provided privacy and screening to Plaintiff’s home, and had played a valuable role
as part of the natural landscape surrounding that home. Indeed, Plaintiff had paid
a forester to thin and manage the grove of trees near her home only a few years
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before the incident alleged in the Complaint, which Fallis said showed her ongoing
interest in maintaining the trees.
Fallis testified as to how he had employed the Trunk Formula Method to
arrive at the value of the trees. He stated that he had followed the steps outlined in
the Guide to identify the cost of the largest commercially available trees of the same
species as had been removed from Plaintiff’s lot and to extrapolate from there to the
size of the larger trees that had been taken. He stated that he had accounted for
the condition of the trees and for the site, the contribution of the trees to the land
and location ratings of the trees. Guide at 70–71.
Fallis testified that the Trunk Formula Method is often used by timber
appraisers, is generally accepted, and that it is one of the methods authorized by
the Guide. He testified that the method has been subject to peer review and can be
tested for accuracy. He also testified that he had tested the results achieved
through the Trunk Formula Method by employing a depreciated replacement cost
formula. The results obtained were within six thousand dollars of his original
estimate of $560,000.
On cross-examination, Defendants challenged Fallis concerning the fact that
he had not used the Market Approach or even considered the overall market value
of the property as a ceiling of reasonableness concerning his expert opinion. Fallis
acknowledged that his appraisal did not take account of the market value of the
property and that his valuation likely well exceeded the market value of the
property. Defendants asserted that his failure to take into consideration the
market value of the property violated the methodology set out in Chapter 8 of the
Guide, which counsels that all appraisals must be “reasonable.”
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Fallis disagreed with the Defendants description of the demands of Chapter
8. In Fallis’ opinion, Chapter 8 requires that appraisals be reasonable but does not
establish the market value of the property as the sole lens of reasonableness. He
pointed to a 2001 article from the Journal of Arboriculture, Exhibit A, which argued
that market value should not be the only gauge of reasonableness for timber
appraisals. He further testified that, in his opinion, market value is not the only
way to judge reasonableness. Under the circumstances of this case, Fallis opined
that the Cost Approach provided a reasonable methodology.
Analysis
As noted above, Defendants do not challenge Fallis’ credentials as an expert
arborist. Aside from his purported failure to follow Chapter 8 of the Guide,
the Defendants also do not appear to challenge the methodology employed by Fallis.
Nonetheless, leaving aside for the moment the reasonableness inquiry, the Court
finds that his methodology meets the Daubert standard for admissibility.
The Guide notes that the Cost Approach is “widely used” and that the cost
information “commonly applied for plant and landscape appraisal may include …
[the] trunk formula method.” Guide at 21. The Trunk Formula Method is outlined
in detail in the Guide, which is an authoritative text; is commonly relied upon by
arborists; can be tested; and is based on sound and easily understood principles.
Guide, at 57–60, 70–71.
Against this, Defendants contend that Fallis’ opinion is fatally flawed due to
his failure to take account of the market value of Plaintiff’s property in arriving at
his valuation. They contend that Chapter 8 makes such an overlay a mandatory
component of any valid appraisal. While the Court is sympathetic to the wisdom of
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such an approach, for a number of reasons, it cannot conclude that the Guide is
clear enough on that point to render Fallis’ opinion wholly unreliable or
methodologically flawed.
First, Fallis testified that Chapter 8 requires that appraisals be reasonable
but offers only one test of reasonableness. He stated that, based on his expert
experience and opinion, the Market Approach does not provide the only basis to
judge reasonableness and that his appraisal was reasonable.1 Exhibit A, though not
supportive of his exact approach, reinforces that idea that professional arborists
sometimes conclude that market factors are not the only components of
reasonableness.
Second, the Guide seems to acknowledge unique situations where
replacement value would be an appropriate appraisal method, despite the fact that
such replacement trees would not likely increase the value of the property by the
amount needed to find and install them. Guide, at 66–67.
Lastly, it appears that all of the methodologies in the Guide provide
reasonable approaches to valuing timber. The Guide acknowledges that some
approaches are more reasonable than others in certain situations. A useful example
for this case is found in Chapter 7. There, the Guide posits an appraiser who
conducts an appraisal using both the Cost Approach and the Market Approach. The
former yielded a valuation of $4,000 per tree and the latter a valuation of $2,000 per
1The Defendants attempted to establish that Fallis had previously testified at his
deposition that he had not followed Chapter 8 of the Guide. While the testimony
was inconsistent at times, the Court believes his testimony at the Daubert hearing
was ultimately clear: Fallis did not follow the test of reasonableness set out in
Chapter 8 but he did comply with Chapter 8’s requirement that appraisals be
reasonable.
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tree. The Guide notes that the Market Approach can be a useful check against the
values derived from the Cost Approach. In this particular scenario, the Guide
concludes that the Market Approach provides the “more reasonable estimate of
value” for the trees. Guide at 97. The Guide concludes that appraisers “may
consider and use both the Market and Cost Approaches for most appraisals….
When the two approaches provide different values, the appraiser should consider
the information, consider the situation, and select the more reasonable appraisal.”
Guide at 97–98.
The above excerpt indicates that: (1) an appraiser “may” use both the Cost
and the Market Approaches, but is not required to do so; (2) employing both
methods is a very useful check on the value arrived at in the Cost Approach; (3)
both methods provide “reasonable” valuations; and (4) depending upon the
“information” and “the situation,” as determined by the appraiser, the Market
Approach may provide a “more reasonable” appraisal figure. The Court is also
mindful of the Guide’s instruction that the “judgment of the appraiser, based on
careful analysis of all the factors, is the key to accurate plant appraisal. As such
the appraiser should remember that this document is only a guide to that end.”
Guide, Preface.
Given those considerations, the Court cannot say that Fallis’ opinion failed to
follow the Guide or is wholly unreliable because it did not consider the Market
Approach. No doubt, Fallis’ failure to compare the Market Approach to the Cost
Approach cannot be seen as a recommended practice, and it will likely provide
ample fodder for cross-examination. Indeed, judging from the example from the
Guide outlined above, the Market Approach may well provide a “more reasonable”
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estimate of value in this case. But, Fallis has opined as to why, in this “situation,”
the Cost Approach is reasonable, and the Court will not employ Daubert to deprive
trier of fact of the chance to consider such testimony. See 985 Associates, Ltd., 2008
VT 14, ¶16, 183 Vt. at 217–18, In the end, it will be up to the trier to determine
whether Fallis’ estimate of value should be adopted in this case.
Conclusion
In light of the foregoing, the Defendants’ motions to exclude the testimony of
Fallis are denied.
Electronically signed on September 28, 2015 at 02:12 PM pursuant to
V.R.E.F. 7(d).
________________________
Timothy B. Tomasi
Superior Court Judge
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