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City of Springfield v. West Koke Mill Development Corporation

April 14, 2000

THE CITY OF SPRINGFIELD, ILLINOIS, A MUNICIPAL CORPORATION, PLAINTIFF-APPELLEE,
v.
WEST KOKE MILL DEVELOPMENT CORPORATION, AN ILLINOIS CORPORATION, AND FIRST OF AMERICA BANK-SPRINGFIELD, N.A., DEFENDANTS-APPELLANTS.



Appeal from Circuit Court of Sangamon County No. 97ED13

The opinion of the court was delivered by: Justice Steigmann

Honorable Thomas R. Appleton, Judge Presiding.

In August 1997, plaintiff, the City of Springfield (the city), filed a petition to condemn certain property owned by defendant West Koke Mill Development Corporation (Koke Mill) and mortgaged to defendant First of America Bank-Springfield, N.A. (First of America), to make roadway improvements. In April 1999, after a trial, a jury awarded Koke Mill $54,925 as just compensation. Koke Mill and First of America appeal, arguing that (1) the city's appraisal witness used methods that violated the so-called "unit rule" in evaluating the condemned property, and (2) the city failed to make a bona fide effort to negotiate a price prior to bringing this suit. We affirm.

I. BACKGROUND

Throughout this litigation, Koke Mill and First of America have been represented by the same attorneys and, in every way relevant for the issues presented in this appeal, have acted as though they were a single party. To simplify our discussion, we will refer to both defendants simply as Koke Mill.

Koke Mill owns an approximately square, six-acre tract of land in Springfield. The property's southern border runs along Iles Avenue, and its eastern border runs down the center of Koke Mill Road. Prior to this litigation, a 20-foot-wide, perpetual right-of-way easement for Koke Mill Road ran along the eastern edge of the property. The strip of land next to that easement was used primarily for drainage. In its August 1997 complaint, the city sought to condemn a 50-foot strip along Iles Avenue and a 60-foot strip along Koke Mill Road, including the existing right-of-way, for the purpose of widening the two roads.

In November 1998, the city filed a motion to amend its complaint, which the trial court ultimately granted. In the amended complaint, the city continued to seek the 60-foot strip to widen Koke Mill Road but no longer sought the strip along Iles Avenue. The city sought just under one acre of Koke Mill's six-acre lot.

At the April 1999 jury trial, the city called Gary Larson, a professional real estate appraiser, to testify regarding (1) what the city should pay Koke Mill for the land the city took, and (2) how he made that determination. He used the "market" approach, which entailed researching recent sales of property he deemed comparable to Koke Mill's six-acre tract. He then determined a value for the portion of the property to be condemned in the following manner. First, Larson arrived at a value for the entire six-acre parcel by comparing its physical characteristics and location to the properties he found in his market research. Second, using the same technique, he determined the value of the remainder property--that is, the Koke Mill property that Koke Mill had left after the city's taking. He based his valuation of the remainder, in part, on his opinion that the portion to be taken by the city contributed less to the value of the overall parcel than the portion remaining did. Finally, Larson subtracted the value of the remainder from the value of the whole to arrive at the amount of just compensation for the portion the city was condemning. Larson recommended $31,500 as just compensation.

Koke Mill moved to strike Larson's testimony, arguing that his appraisal method was contrary to law. The court denied Koke Mill's motion.

Charles Johnson, another professional real estate appraiser, testified for Koke Mill. Like Larson, Johnson researched comparable transactions in the area of the subject property. However, Johnson used that information to determine a per-square-foot price for Koke Mill's six-acre tract. He then calculated the value of the portion to be condemned by multiplying the same per-square-foot figure by the number of square feet that the city sought. The resulting figure was $146,496.

On this evidence, the jury awarded Koke Mill $54,925, as stated. This appeal followed.

II. ANALYSIS

A. Valuation of Partial Takings

First, Koke Mill argues that the trial court erred by refusing to strike Larson's appraisal testimony. Specifically, Koke Mill points out that, in determining the value of the remainder property, Larson took into account his opinion that the area to be condemned contributed less to the value of the overall parcel than other portions of that property. Koke Mill argues that Larson's methodology violated the rule governing partial condemnation cases, which requires that the area to be condemned be evaluated as a part of the original lot and not as a separate parcel. We disagree.

Article I, section 15, of the Illinois Constitution provides, in relevant part, that "[p]rivate property shall not be taken or damaged for public use without just compensation as provided by law." Ill. Const. 1970, art. I, §15. The Eminent Domain Act (Act) provides the means through which a public body may compel the transfer of property in exchange for the compensation required by our constitution. 735 ILCS 5/7-101 through 7-129 (West 1998). The purpose of condemnation proceedings is to place the landowner, or condemnee, in the same economic position as if no condemnation occurred, not to improve the condemnee's financial status. People ex rel. Director of Finance v. Young Women's Christian Ass'n, 74 Ill. 2d 561, 572, 387 N.E.2d 305, 311 (1979); Department of Transportation v. Chicago Title & Trust Co., 303 Ill. App. 3d 484, 495, 707 N.E.2d 637, 645 (1999).

A public entity that seeks to condemn private property must pay fair market value, defined as "the amount of money [that] a purchaser, willing but not obligated to buy the property, would pay to an owner[,] willing but not obliged to sell[,] in a voluntary sale." 735 ILCS 5/7-121 (West 1998). In a partial condemnation case, that is, in a case where the condemnor seeks only a portion of the condemnee's land, applying this definition has occasionally proved difficult. Typically, the condemnor in such a case will seek a narrow strip along a roadway or some other oddly shaped parcel, which may contribute significant value to the landowner's original parcel, but which has limited economic utility as a separate piece of property. Two different values for the same piece of land result. The first ...


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