Opinion
No. CV 97 0572219
June 9, 2004
MEMORANDUM OF DECISION
This is a consolidated case in which in one cause of action Tilcon, Inc. (hereinafter "Tilcon") applies for reassessment of damages for the condemnation of certain of its land by the City of Bristol, and in the other cause of action Tilcon asserts against Bristol claims of inverse condemnation and trespass of adjacent lands.
The underlying facts are as follows:
Bristol began operating a landfill on land bordering the town of Southington in 1946. The landfill was located on an existing brook and swampy area. It evolved from an open burn dump to an open dump, then to a sanitary landfill operation in 1966. In 1984 it became a municipal solid waste landfill operating under a state permit to discharge water. In 1987 the solid waste permit for the landfill was modified to include a one-acre ash disposal area. The area was later expanded in 1988 to seventeen acres on the easterly portion of the landfill to provide for ash residue disposal from the Bristol resource recovery facility. In 1995 the Department of Environmental Protection (DEP) initiated a proceeding against the City of Bristol to prohibit the discharge of water, substance or materials, including but not limited to leachate, from the landfill into the waters of the state. This resulted in a consent order dated October 24, 1995 with the state of Connecticut in which the City agreed to cease the disposal of solid waste to the landfill on or before March 1, 1997, to hire consultants to investigate the potential impact of the leachate generated at the landfill both before and after closure on the quality of surface water to the south of the landfill, and to submit a plan for remediation of potential contamination of land outside of the landfill. As a consequence of the consent order, the City of Bristol on July 18, 1997 filed a statement of compensation with this court and deposited $50,000 for the taking of easements and other rights on 24.84 acres of Tilcon's property for a period of thirty-one years. On August 15, 1997, Bristol recorded the certificate for taking in the Southington Land Records, condemning the following areas:
In 1996 the Connecticut General Assembly enacted Special Act 1996, No. 96-12 which permitted municipalities to acquire or condemn property rights outside their borders for the purpose of complying with DEP consent orders.
(1) Two "Zones of Influence Easement Areas" containing approximately 14.3 acres;
(2) Two "Monitoring Well Easement Areas" containing approximately 36,800 sq. ft.;
(3) Three "Access Basement Areas" containing approximately 10.7 acres on the Tilcon property; together with
(4) The exclusive right to "withdraw ground water from the zone of influence areas";
(5) The right to release and deposit contaminants and pollutants directly and indirectly on or in the ground waters and subsurface rocks and formation within the zone of influence areas;
(6) The right to enter on, over and across and under the access easement areas and the monitoring well easement areas and to transport such machinery and materials as may be required for the purpose of collecting environmental data, extracting water from monitoring wells and conducting such investigations and tests which Bristol deems necessary in order to monitor and treat the groundwater within the zone of influence area;
(7) The right to pump and treat water from the access easement areas for the purpose of remediating contamination from Bristol's landfill of the groundwater within the zone of influence area; CT Page 8963
(8) The right to enter on, over across, under and upon the access easement areas and the monitoring well areas on foot or by vehicle and transport such machinery and materials as may be required for the purpose of maintaining, repairing and replacing any and all facilities located within such easement areas; and
(9) The right to enter on, over, across and upon the access easement areas and monitoring well easement areas on foot or by vehicle and transport such machinery and material as may be necessary or convenient for the purpose of exercise in the easement taking.
In addition, Bristol condemned a two-year right to enter upon the access easement areas and monitoring well easement areas to construct and install four monitoring wells within the monitoring well easement area together with associate pumps, piping, hardware and equipment.
Tilcon owns approximately 184 acres of land south and east of the landfill. For many years it had mined land south of the landfill and north of Eight Mile River for sand and gravel which it used in its extensive highway construction business. In 1996, however, it ceased mining the property for that purpose. It retained some fill on the property in order to retain its mining permit and to continue to mine sand and gravel on the property owned by Norton to the north and east of Tilcon's property and also on the property owned by Reynolds to the east of the Norton property. The property subject to the easement was used as an access to the Norton and Reynolds properties but there are alternate, feasible routes over the Norton property and other land of Tilcon.
Tilcon had a business plan, which it had effectuated in the past of, after completing the mining of sand and gravel on a given piece of land, to cover it with fill and to subdivide it for the sale of residential lots.
An engineering consulting firm, Fuss O'Neill, hired by Bristol, determined that volatile organic compounds including choloroethane, dychloroethane, chlorobenzene, dichlorobenzene, benzene, ethylbenzene and exylenes were detected from monitoring wells located within the easement area. These volatile organic compounds exceeded water quality standards of the State Department of Health. The study further found that leachate impact is evident in ground water and surface water downgrade from the eastern end of the landfill and appears to flow to the east and southeast and discharge into Eight Mile River. Soil on Tilcon land near the landfill has been contaminated and there is some indication of the presence of methane gas, but that is inconclusive.
Fuss O'Neill further found that the leachates from the landfill affect the underground water in an area outside the zone of influence of the easements over a triangular piece of land (identified as Portion B on Exhibit J) that is slightly less in area than a portion (identified as A on Exhibit J) which is within the zone of influence. This area amounted to nineteen acres.
Tilcon prepared a residential reuse concept plan for the development of its 184 acres. The zone of influence and access easements directly impact fourteen of these lots and the flow of leachates affects the underground water of sixteen of these lots outside the taking area. The balance of the lots in the subdivision plan are not impacted and not a part of this action.
A major factual issue is the highest and best use of the land that is the subject of the statutory and de facto taking. The appraiser for Bristol asserts that the highest and best use of the property is "for the continuation of the current sand and gravel mining operation for the next ten to twenty years." The appraiser for Tilcon noted that the property is zoned for R-40 residential and that the highest and best use of the property is for the development of residential lots.
Our courts recognize that the highest and best use concept is a starting point for estimating the value of real property in a condemnation case. In Northeast Connecticut Economic Alliance, Inc. v. ATC Partnership, 256 Conn. 813, 828 (2001), the court said, "We have stated repeatedly that `the amount that constitutes just compensation is the market value of the condemned property when put to its highest and best use at the time of the taking.'" That use is one "which will most likely produce the highest market value, greatest financial return, or the most profit from the use of a particular piece of real property." Id. 829. In determining the highest and best use the court must consider whether there was "a reasonable probability `that the subject property would be put to that use in the reasonably near future, and what effect such a prospective use may have had on the property's market value at that time of the taking.'" Id.
In the instant case, this court notes that Tilcon had ceased its mining operation on the subject property by the time of the taking and had an established business plan of converting previously mined property into residential lots. The court viewed the property and the neighborhood. It observed that there were access town roads and public water nearby and that the surrounding area was characterized by attractive homes, a golf course and Briarwood College. Also, it was near the large ESPN television facility which has many employees and provides a market for homes. The court concludes upon all of the evidence, including its visit to the site, that the highest and best use for the subject property subject to the statutory and de facto taking is for residential homes.
The underlying rule of damages recoverable for a partial taking of land is measured by the application of the "before and after" rule to determine "the difference between the market value of the whole tract as it lay before the taking and the market value of what remained of it thereafter, taking into consideration the changes contemplated in the improvements and those which are so possible of occurrence in the future that they may reasonably be held to affect market value." D'Addario v. Commissioner of Transportation, 180 Conn. 355, 365 (1980).
A threshold issue is whether or not in evaluating the land as of the date of taking consideration should be given to its contaminated state at that time. In Northeast Ct. Economic Alliance v. ATC Partnership, supra, our Supreme Court noted that this issue was one of "first impression" (830) and clearly held that in determining the fair market value of the property as of the date of condemnation its contaminated condition should be taken into account. It stated, "Excluding contaminated evidence as a matter of law is likely to result in a fictional property value — a result that is inconsistent with the principles by which just compensation is calculated. It blinks at reality to say that a willing buyer would simply ignore the fact of contamination, and its attendant economic consequences, including specifically the cost of remediation, in deciding how much to pay for property." Id. 833-34.
However, in that case contamination of the subject property was caused by the prior owner and it was purchased by the plaintiff with knowledge of that contamination. In the instant case, the evidence is clear that Bristol itself had contaminated the subject property for some years prior to the taking. That fact distinguishes this case from Northeast Ct. Economic Alliance, Inc. v. ATC Partnership, supra.
A fundamental principle of condemnation embedded both in the United States and the Connecticut constitutions, is that land owner is entitled to fair compensation. What constitutes fair compensation is an equitable question rather than strictly a legal or technical one. "The paramount law intends that the condemnee shall be put in as good condition pecuniarily by just compensation as he would have been in had the property not been taken." Colaluca v. Ives, 150 Conn. 521, 530 (1963); Alemany v. Comm'r of Transportation, 215 Conn. 437, 444 (1990).
Because the standard is fair compensation, the courts have recognized that the rule of valuation of the property at the taking date will not be strictly adhered to if it results in compensation that is more or less than just. Nichols on Eminent Domain (3rd) § 18.16, p. 18-111.
In Becos v. Mosheta, 238 N.E.2d 548 (Ohio, 1968), where the county began acquiring properties and demolishing buildings five years before the taking of plaintiff's property, and those activities caused a substantial depreciation in plaintiff's property as of the date of taking, the court adjusted the date of taking to one "which was reasonably related to events in the vicinity of the property taken whereby the appropriating authority's activity contributed to or caused substantial depreciation of the property taken." Id. 551. The court added this method "promotes the constitutional requirement that just compensation be paid." Id.
Similarly in City of Buffalo v. J.W. Clement Company, 269 N.E.2d 895 (N.Y. 1971), where the city caused the property owner to lose potential tenants prior to the taking and thereby reduced the value of the property, the court held "the claimant's property should be evaluated not on its diminished worth caused by the condemnor's action, but on the value, except for such `affirmative value — depressing acts' of the appropriating sovereign." Id. 905.
In Slavitt v. Ives, 163 Conn. 198 (1972), our Supreme Court held that when a year before the filing of certificate of taking of the subject property, the state had condemned the sole right of way over another person's land to that property, compensation would be based not on the taking date but on the earlier date.
In Klopping v. City of Whittier, 500 P.2d 1345 (Cal. 1972), the court decided that where the city's unreasonable acts prior to condemnation resulted in a loss of rental, the land owner should be compensated in a condemnation proceeding for that loss. The court said, "To hold otherwise would permit a public body to depress the market value of the property for the purpose of acquiring it at less than market value." Id. 1354.
The theme running through these cases is that when the condemning authority causes a decrease in value of the land it subsequently takes in eminent domain, fairness requires that the land be valued for compensation purposes either before the acts that depreciated the land, or as if the land had not been depreciated.
In this case for Bristol to contaminate Tilcon's property and then only pay compensation for the subsequent taking on the basis of the before-value of the land as contaminated flies in the face of fairness.
While it is true condemnation is an in rem proceeding and in personam responsibility for contaminating the property before the taking either by the property owner or by a third party is not allocated ( Northeast CT Economic Alliance, Inc. v. ATC Partnership, supra, 838-39), when the condemnor is the contaminator, the in rem nature of the proceeding should not dictate the result. As stated above, the issue of fair compensation "is an equitable question rather than strictly a legal or technical one." Colaluca v. Ines, supra, 444. The standard of fair compensation requires that when the condemnor has alone contaminated the property before the taking, and the very act of contamination is the cause of the condemnation itself, the property should be valued on the date of taking as if not contaminated. This is the principle approved by the United States Supreme Court in U.S. Virginia Electric Co., 365 U.S. 624, 636 (1961), when the Court noted that in determining compensation in a condemnation case it "must exclude any depreciation in value caused by the prospective taking once the government `was committed' to the project . . . As one writer has pointed out, `[I]t would be manifestly unjust to permit a public authority to depreciate property values by a threat . . . [of the construction of a governmental project] and then take advantage of this depression in the price which it must pay for the property' when eventually condemned. 1 Orgel, Valuation under Eminent Domain, § 105 at 447 (2d ed.)"
In Albahary v. City of Bristol, docket no. CV 98-0485795-S, judicial district of New Britain at New Britain (Wiese, J., April 2, 2003), on facts similar to the instant case, the court reached a different result. This court finds the reasoning of that case unpersuasive.
1. Damages for Statutory Taking
The court now turns to the issue of fair compensation for the statutory taking. At the outset it must be emphasized that the taking consists not of a fee interest in the land but of easements for a period of thirty-one years over 24.84 acres of Tilcon's land These easements include the rights to release and deposit contaminants into the ground water and subsurface rock foundations within a defined zoned of influence, to enter and cross land designated under the access easement and monitoring well easement areas for the purpose of collecting environmental data or extracting water from monitoring wells and conducting investigations and tests to monitor and treat ground water within the zone of influence areas, and to pump and treat the water from the access easement areas for the purpose of remediation.
Bristol's appraiser determined that the highest and best use of the Tilcon property is for the continuation of the current sand and gravel mining operations for the next ten to twenty years. He then looked at comparable sales of large tracts of land and concluded that the per-acre value of 128.8 acres of the Tilcon land before taking was $10,000 per acre. He determined that the taking would not affect the highest and best use of the Tilcon property for mining purposes for the next ten to twenty years. He calculated the impact of the easements upon the property as reducing its per acre value of $10,000 to $9,700-9,800 per acre. He reached a before-taking value of $1,850,000.00 and an after-taking value of $1,793,000.00 and damage of $57,000 rounded to $50,000.
The court finds that appraisal unpersuasive. Tilcon had ceased mining the subject property a year before the taking. Although the subject property was used for access to its sand and gravel operations on the adjacent Norton and Reynolds land, it was feasible and economical for Tilcon to access those operations across another portion of its land and of land of Norton.
Rather, the court accepts the opinion of Tilcon's appraiser that the highest and best use of the property subject to the taking is for single-family homes. That appraiser noted that the 24.84 acres constituting the taking was capable of supporting, either fully or partially, fourteen residential lots. Based upon comparable sales, he determined that these lots, unimproved, had a value of $25,220.00 per lot, indicating a value before taking of $353,080.00. He further determined that the easements taken by Bristol to pollute and maintain effective control of the land for thirty-one years have a chilling effect on Tilcon to develop its land during this period of time and also the contamination has a stigma effect for the duration of the life of the easements. As a consequence of the easements and the stigma, he determined Tilcon will not be able to develop this land as currently zoned for its highest and best use for the entire thirty-one years of the easements. Finding a 10% rate of return as reasonable for an investor on vacant land, he discounted the value of $353,080 by 10% for thirty-one years to get a value of $18,395. He added to this raw land value after the taking, the value of the remaining fill of $120,200, plus the value of sixteen lots also polluted, but not taken, at $25,220 per lot for an indicated value of $403,520." He summarized his calculation of damages as follows.
He stated "An investor who must wait thirty-one years to receive any compensation for its land would, in my opinion, only pay a discounted amount of funds equal to $18,395.00 for this land in its polluted state with easements for thirty-one years."
14 lots × $25,220 discounted for 31 years at 10% interest $ 18,395.00
16 lots × $25,220 $403,520.00
Value of fill remaining $120,220.00
Value of remainder X
Value before taking $880,000.00
Value after taking $542,135.00
Net damages for statutory taking $337,865.00
Rounded $340,000.00
Bristol argues that this appraisal is flawed in several particulars. First Bristol claims that the appraiser erred in evaluating the land as if it were approved lots. The testimony was that the subdivision plan conforms to the zoning of the property in an R-40 residential zone and conforms to the regulations of the Town of Southington. In Minicucci v. CT Page 8970 Commissioner of Transportation, 211 Conn. 382, 385-6 (1989), the court noted that "where a property rises sharply from the existing grade of a road and contains significant qualities of rock and visible outcroppings of ledge, it may exercise its discretion in determining that the property should not be valued as if subdivided." However, in this case where the property is zoned R-40 residential, is level, and surrounded by residences, the court, based on its own observation of the property, determines that it is highly probable that the subject property could and would be subdivided into R-40 residential lots. Moreover, Tilcon's appraiser did not value the lots as improved, but, rather, as unimproved but likely to be approved R-40 subdivision lots.
Bristol also contends the appraisal is flawed in that the appraiser did not consider the before and after taking value of the entire 184 acres of Tilcon's property. In fact, the appraiser did take into account the entire tract owned by Tilcon, but since the lots outside of the taking were not directly impacted by the Bristol landfill as of the date of taking, they were assigned a constant value of X in the before and after value.
However, the court has some differences with the Tilcon appraiser's evaluation. First, there appears to be no reason why the sixteen lots not condemned, at $25,220 per lot, should be considered since they are not part of the taking. Moreover, the value of the fill at $120,220 should not be considered because the taking does not affect the value of that fill in any way. Tilcon is free to use that fill to spread over the subject land for grading purposes or to sell it if it so wishes.
As a consequence the court calculates damages as follows:
Value before taking of fourteen lots, constituting the property subject to the easement, at $25,220 per lot $353,080
Value after taking of 14,000 lots at $25,220 per lot discounted for 31 years at 10% 18,395 ________ Net damages for the statutory taking $324,785
2. Inverse Condemnation Action
In its action against Bristol, Tilcon alleges causes of action in inverse condemnation and in trespass.
Inverse condemnation occurs when there has been a taking of property for a public purpose, without compensation and without an actual or physical appropriation of the property. Citino v. Redevelopment Agency, 51 Conn. App. 262, 277 (1998). It is "a shorthand description of the manner in which a landowner recovers just compensation for a taking of his property when condemnation proceedings have not been instituted." Bauer v. Waste Management of Connecticut, Inc., 234 Conn. 221, 249-50 n. 15 (1995).
In the instant case Bristol condemned by way of easements 24.84 acres of Tilcon's land, but did not condemn 19 acres of Tilcon's land under which a plume of pollution of the underground water extended from the Bristol landfill. Bristol knew leachate from this landfill extended beyond the area taken at the time of the condemnation.
There is a dispute in the testimony of a till ridge that could block the spread of the contamination on the land Tilcon claims to be inversely condemned and a dispute as to the area of land impacted by the leachate from the Bristol landfill. The court finds the evidence of the till ridge to be inconclusive. An employee of Fuss O'Neill, the consulting engineers hired by Bristol, testified the plume of leachate extended over about four-fifths of 19 acres of land in dispute in this court (the white area west of the taking line on Exhibit J) and an employee of EA Engineering, Science Technology, consulting engineers hired by Tilcon, testified the leachate flowed under the entire 19 acres. The court believes the latter testimony and finds the leachate impacted 19 acres of Tilcon's land, or 16 lots on Tilcon's subdivision plan.
As stated in Tamm v. Burns, 222 Conn. 280, 284 (1992), "a constitutional taking occurs when there is a `substantial interference with private property which destroys or nullifies its value or by which the owner's right to its use or enjoyment is in a substantial degree abridged or destroyed.'" Substantial interference with property rights is not a static one, but one developed over the years in response to the changing needs of our society. Textron, Inc. v. Wood, 167 Conn. 334, 347 (1974). Once a "property owner is no longer able to use its property as it had before, and the landowner's capacity to dispose freely of its property has been for all practical purposes arrested, property has been taken in the constitutional sense. Enjoyment and use of the entire property need not be completely destroyed for land to be deemed taken . . . There need be only a near total destruction of the land's prior use and a marked depreciation in value." Citino v. Redevelopment Agency.
In the instant case, Tilcon's appraiser testified that as to the 14 lots subject to the statutory taking, the easements Bristol acquired to cross and recross the land, to release contaminants and pollutants in the ground water and to take the necessary steps to remediate the contamination, together with the contamination itself, destroyed the marketability of the lots for 31 years. The court found that testimony credible and as indicated above, made an award to Tilcon on the basis of it.
As to the 16 lots subject to this claim of inverse condemnation, Bristol has acquired no easements over the property, but the contamination has created a stigma which substantially interferes with Tilcon's right to use its property as it could before the contamination and has markedly depreciated its value.
Bristol argues Tilcon's claim of inverse condemnation must fail because Tilcon has not established the precise date of the taking. That date may be significant for determining the before and after value in order to calculate damages. But in this case, where Bristol contaminated the property before the taking, the court decided the property would be evaluated as if not contaminated. Moreover, in an inverse condemnation case, when governmental action has caused depreciation in the value of property gradually over a period of time, the court will pick the date of inverse condemnation as when the land owner had reasonable notice of the damages to his land Ulichny v. City of Bridgeport, No. CV 86-0228566, Judicial District of Bridgeport (Spear, J., Jan. 25, 1993). See also Citino v. Redevelopment Agency, supra 284. In this case the court finds the date of taking of the land by condemnation serves as well for the land inversely condemned.
The court finds Tilcon has proven its claim of inverse condemnation and turns to the issue of damages. The measure of damages governing both condemnation and inverse condemnation is the same. Citino v. Redevelopment Agency, supra, 282. A judge trial referee determining fair compensation in either type of case is more than a trier of fact or the arbitrator of differing opinions of witnesses. He can make "an independent determination of value and fair compensation in the light of all the circumstances, the evidence, his general knowledge and his viewing of the premises." Minicucci v. Commissioner of Transportation, 211 Conn. 382, 388 (1989).
Tilcon's appraiser testified the 16 lots subject to the de facto taking had a before-taking value of $25,200 per lot or $403,520, an after-taking value, by discounting the $403,520 at 10% for 31 years, of $21,023, and opined the damages to be $382,470 rounded to $380,000. This court differs with that calculation of damages because it finds the contamination alone, without the easements acquired by Bristol in the statutory taking, did not totally destroy the marketability of the lots. Rather, the court finds that the stigma resulting from the contamination reduced the value of the 16 lots by one-half. ( Bristol v. Milano, 45 Conn. Sup. 605, 620 (1998); Northeastern Gas Transmission Co. v. Tesana Acres, Inc., 144 Conn. 509, 512 (1957); Tilcon Minerals, Inc. v. Town of Southington, Judicial District of Hartford at New Britain (Bieluch, Brennan and Stoughton, J.T.R.s, Jan. 3, 1994). Consequently, it concludes that fair compensation for the inverse condemnation of the 16 lots is one half of $403,520, or $201,760.
Tilcon claims attorneys, appraisal, and engineering fees in this inverse condemnation action, pursuant to C.G.S. § 48-17b. That statute does provide that a prevailing plaintiff in such an action is entitled to such fees when the inverse condemnation proceeding is "brought against the state." Bristol is not an agency of the state but a political subdivision thereof. Bridgeport v. Agostinelli, 163 Conn. 537, 550 (1972). Citino v. Redevelopment Agency, supra, clearly distinguishes between an agency of the state and of a municipality, holding an inverse condemnation action against a state agency entitles plaintiff to the fees specified in § 48-17b, but infers that one brought against an agency of a municipality does not. Thus the court concludes plaintiff may not recover those fees.
3. Trespass Action
Tilcon alleges a count in trespass based on the extension of the plume of a leachate from the Bristol landfill under its land The common law has long been that any intrusion under or over another's land constitutes a trespass. Restatement of Torts 2d § 159, 75 Am.Jur.2d, Trespass, § 10; Philetus Holt. v. Crest Lincoln Mercury, Inc., 3 Conn. L. Rptr. 574 (1990); Blackburn v. Miller-Stephenson Chemical Company, Inc., No. 314089, Jud. Dist. Danbury (Skolnick, J., Jan. 12, 1995) ( 13 Conn. L. Rptr. 364).
The court finds the invasion of leachate from the landfill over the nineteen acres that caused damage to and depreciation of Tilcon's land constituted a trespass.
Tilcon alleged the trespass is permanent. Normally a plaintiff is obligated to prove the allegations of its complaint. Maris v. McGrath, 58 Conn. App. 183, 184, n. 1 (2000), but the court finds that the thirty-one years it is likely to take Bristol to remediate the contamination of the landfill is permanent enough.
Bristol moved at the outset of trial to assert a special defense of statute of limitations to this trespass count. The court denies that motion on the grounds it is unfair to interpose such a defense at such a late date when the case had been pending since 1997.
In a trespass action based upon invasion of another's land the measure of damages is the diminution in value of the land resulting from the invasion. Here the damages for trespass would be the same as for inverse condemnation, namely $201,760.
Based on the foregoing, Tilcon is entitled to judgment as follows:
1. On the application for reassessment of compensation for the statutory taking: $324,785, minus $50,000 paid by Bristol, or $274,785, plus interest at 8 percent per annum from the date of taking to the date of payment.
2. On the inverse condemnation and the trespass counts: $201,760
3. Costs and a reasonable appraisal fee of $5,415.
Robert Satter Judge Trial Referee