Opinion
C. A. S21C-03-017 FJJ
10-27-2022
THE STATE OF DELAWARE, UPON THE RELATION OF THE SECRETARY OF THE DEPARTMENT OF TRANSPORTATION, Plaintiff, v. MELPAR, LLC, 1,7761995 SQUARE FEET (0.0408 ACRES) OF LAND, 711.9788 SQUARE FEET (0.0163 ACRES OF LAND, 3,598.7712 SQUARE FEET (0.0826 ACRES) PART OF TAX MAP AND PARCEL NUMBER 234-23.00-269.14 SITUATED IN INDIAN RIVER HUNDRED, Defendant.
Bradley Eaby, Deputy Attorney General, Department of Justice, Wilmington, Delaware. Attorney for the State of Delaware, Richard L. Abbott, Esquire, Abbott Law Firm, Hockessin, Delaware. Attorney for Defendant Melpar, LLC.
Submitted: October 17, 2022
Bradley Eaby, Deputy Attorney General, Department of Justice, Wilmington, Delaware. Attorney for the State of Delaware,
Richard L. Abbott, Esquire, Abbott Law Firm, Hockessin, Delaware. Attorney for Defendant Melpar, LLC.
OPINION AND ORDER ON THE STATE OF DELAWARE'S MOTION FOR NEW TRIAL, OR, IN THE ALTERNATIVE, TO AMEND THE VERDICT: DENIED
Francis J. Jones, Jr., Judge
INTRODUCTION
This is a condemnation case in which the State of Delaware Upon Relation of the Secretary of the Delaware Department of Transportation (the "State") partially took property located at the southeast corner of the intersection of John Williams Highway and Long Neck Road in Sussex County, Delaware (the "Property"). Melpar, LLC ("Melpar") owns the Property.
Dash-In leased the Property from Melpar and ran a convenience store and gas station on the Property. DashIn was an original party to the lawsuit but settled with the State prior to trial. Thus, the issue at trial related only to Melpar's interest.
After a four-day trial, on September 23, 2022, a Condemnation Commission returned a verdict in favor of Melpar upon concluding the fair market value of the taken land to be $675,000. The State now has moved for a new trial, or, in the alternative, for an amended verdict. After careful consideration of the State's motion and Melpar's response, the Court has determined the motion must be DENIED.
As with all eminent domain actions, the State is required to provide just compensation to the owner of the taken property. "Just compensation" is the fair market value of the land taken. See State v. Davis Concrete of Del., Inc., 355 A.2d 883, 886 (Del. 1976).
FACTUAL AND PROCEDURAL BACKGROUND
Melpar leased the Property to Dash-In Food Stores ("Dash-In") pursuant to a written lease (the "Lease"). The Lease originally ran through May of 2022 and was subject to six five-year renewal options at Dash-In's discretion. As a tenant, Dash-In ran a convenience store and gas station on the Property without restriction.
The State took a portion of the Property pursuant to this Court's order of possession on December 9, 2021. As a result of the taking, patrons of the DashIn were no longer able to: (1) turn left out of the Property onto southbound Long Neck Road; and (2) turn left into the Property from southbound Long Neck Road.
It was not controverted that the taking disrupted Dash-In's business operation by limiting the amount of traffic coming in and out of the Property. The dispute for trial, then, was the impact of the newly-limited access on the Property's value. Melpar argued the taking decreased the value of the Property by $848,600. The State disagreed and believed the decrease in value to be $200,000. Both parties considered the "Highest and Best Use" of the Property to be crucial in determining its "Before and After" value.
Additionally, the parties disagreed on whether the taking impacted gas and/or delivery trucks from being able to enter and exit the property. The Court, however, does not regard this point as a central focus of the trial.
In short, the "Before and After" approach calculates the pre-taking ("Before") and post-taking ("After") value of a property. The difference in value constitutes the damages owed to the aggrieved party.
To prove its claim, Melpar relied on the testimony of Stephen Parsons, a principal of Melpar, as well as the opinions of experts in the fields of property appraisal and traffic engineering. Mr. Parsons believed Dash-In would terminate the Lease after it appreciated the decrease in customer flow as a result of the taking. Laurence Moynihan, an expert appraiser, testified the "Highest and Best Use" of the Property had shifted from a convenience store with gas pumps "Before" the taking to a local commercial operation "After" the taking. To calculate the damages incurred by Melpar, Mr. Moynihan utilized a "sales comparison approach" based on his belief that Dash-In would terminate the lease due to diminished sales. He concluded Melpar suffered $848,600 worth of damages.
At the time of trial, Dash-In had not exercised its right to terminate the Lease.
The State's defense consisted of cross-examining Mr. Parsons and Melpar's experts and submitting its own expert testimony. Georgia Nichols, an expert appraiser appearing for the State, testified there was only a thirty (30) to forty (40) percent decline in sales at the Dash-In immediately after the taking. To Ms. Nichols, the "Highest and Best Use" of the Property had merely declined from a convenience store with gas pumps "Before" the taking to a smaller convenience store with gas pumps "After" the taking. Instead of using Mr. Moynihan's "sales comparison approach," Ms. Nichols implemented an "income capitalization approach" to calculate Melpar's damages. She arrived at the total of $200,000.
The Commission retired for deliberations on September 21 and returned with its verdict on September 22. Ultimately, the Commissioners awarded Melpar with $675,000 in damages. The State now moves for a new trial under Rule 59.
Super. Ct. Civ. R. 59. As discussed infra, the State's motion under Rule 59 is procedurally improper.
Maier v. Santucci, 697 A.2d 747, 749 (Del. Super. 1997) (internal citations omitted).
STANDARD OF REVIEW
When considering a motion for a new trial under Rule 59, the Court must appreciate that "[t]raditionally, the Court's power to grant a new trial has been exercised cautiously with extreme deference to the findings of the jury."Further, "when the case involved a controverted issue of fact in which the evidence is conflicting and out of the conflict may be gathered sufficient evidence to support a verdict for either party, the issue of fact will be left severely to the jury .. .." The Court will not upset the verdict of a jury unless "the evidence preponderates so heavily against the jury verdict that a reasonable juror could not have reached the result."9 Stated differently, a jury's award is presumed correct and just unless it is so grossly out of proportion to the evidence presented as to shock the Court's conscience and sense of justice.
Storey v. Camper, 401 A.2d 458, 462 (Del. 1979).
Id. at 465.
See Porter v. Murphy, 2001 WL 1738872, at *1 (Del. Super. 2001).
The Delaware Supreme Court has found that, as jurors in a civil trial, Commissioners remain the sole and exclusive judges of the facts of the case, credibility of the witnesses, and weight and value of the witness testimony. As the Court held in Del-Tan Corporation v. Wilmington Housing Authority:
297 A.2d 34, 35 (Del. 1972).
Id.
The award of a Condemnation Commission is similar in nature to the verdict of a jury, and the findings of a Commission, like those of the jury, will not be disturbed by this Court if there is competent evidence in the record to support them . . . we cannot substitute our own judgment.
See id.; see also 14.098 Acres of Land, etc. v. Bd. of Ed. of the Claymont Special School District, 265 A.2d 36, 38 (Del. 1970) (direct conflict in evidence as to whether re-zoning was reasonably probable rendered matter for Commission to decide).
When facts are in dispute, it is for the Commissioners to decide which elements of a claim merit compensation and what value should attach. Accordingly, this Court will not weigh evidence, determine credibility, or make factual findings and conclusions. The role of this Court is only to determine whether the record contains substantial evidence to support the Commission's verdict and correct errors of law.
See Johnson v. Chrysler Corp., 213 A.2d 64 (Del. 1965).
See 0.089 of an Acre of Land v. State of Delaware, 145 A.2d 76, 80 (Del. 1958).
Super. Ct. Civ. R. 59. In typical civil proceedings, Rule 59 provides parties with ten (10) days to move for a new trial.
ANALYSIS
The State argues the Commission's award is against the great weight of the evidence and based on a misinterpretation of Delaware law. For the reasons stated below, the Court disagrees.
A. The State's Motion is Untimely
At the outset, the Court notes the State's motion is untimely. The State moved for a new trial on October 7, 2022 and urges the Court to consider the motion timely pursuant to Rule 59. This approach is incorrect.
Super. Ct. Civ. R. 81(a).
Superior Court Civil Rule 81(a) acknowledges there are separate rules for "Special Proceedings" under statute and Court Rules will only apply "so far as practicable and to the extent that this will not contravene any applicable statutes." Two such "Special Proceedings" enumerated in Rule 81(a) are "Condemnation and Eminent Domain [Proceedings]." Rule 81(a) goes on to state the applicable statute for Condemnation Proceedings is 10 Del. C. § 6108(g).
Id.
10 Del. C. § 6108(g) (emphasis added).
Pursuant to 10 Del. C. § 6108(g), this Court is to confirm the awards of the Commission unless the moving party "file[s] and serve[s] within five days of the award, [to] set aside the erroneous award in whole or in part, or [to] modify the award to conform to the facts as presented by the evidence.. .."
Mr. Moynihan and Ms. Nichols both used the income capitalization approach in the "Before" analysis. As Ms. Nichols explained, the purpose of using two approaches is to provide a "check and balance" on the first approach and the comparative sales figures.
In other words, Delaware law requires any Motion to Amend or Alter a Verdict to be filed within five (5) days of the Commission's verdict. The State failed to comply. Therefore, the State's motion is untimely.
B. Mr. Moynihan Properly Used the Sales Comparison Approach
Even if the State's motion was procedurally proper, however, the Court would still find it lacks merit.
First, the State submits that because Mr. Moynihan used the income capitalization approach to calculate the "Before" value of the Property, his failure to use the approach for the "After" calculation necessitates a new trial under Delaware law.
Mr. Moynihan testified he did not use the income capitalization approach for the "After" value because he believed Dash-In would eventually terminate the Lease as a result of the taking.21 He supported this belief by relying on: (1) the traffic engineering report; (2) a conversation with Dash-In personnel; and (3) the testimony of Mr. Parsons; and (4) his extensive experience as an appraiser. Instead, he used a sales comparison approach in both the "Before and After" analysis.
The Court rejects the State's argument that Delaware law required Mr. Moynihan to calculate the Property's "Before and After" value using the income capitalization approach. For one, the cases relied upon by the State from other jurisdictions do not stand for this proposition; rather, they simply hold that when an appraiser undertakes a "Before and After" analysis, both valuations must be calculated by the same method. Moreover, at trial Ms. Nichols testified the sales comparison approach was a superior method for indicating the value of the Property in this case. As noted supra, Mr. Moynihan used the sales comparison approach in both parts of his "Before and After" valuation. His method was proper, and it was within the province of the Commissioners to accept it. The Court will not second guess the Commission's decision in this regard.
See Comm'r of LaRobina, 882 A.2d 1265, 1273 (Conn. App. 2005); see also Mil-Pine Plaza, Inc. v. State, 72 A.D.2d 460, 462937 (N.Y. App. 1980).
Tr. B. at 201-202.
C. The Court Will Not Disturb the Commission's Award
Finally, the Court's conscience is not shocked by the Commission's verdict. The Commissioners awarded Melpar with $675,000 in damages. This award is $173,600 less than Melpar sought in its complaint and reflects that the Commissioners found the presentation of Melpar more compelling than that of the State.
Melpar submits that so long as the award falls within the low and high end of the appraiser's valuations, it is within the "range of value" under Delaware law and must be affirmed. The Court rejects the notion that Delaware has a per se range of value rule. Instead, Delaware law requires the Court to examine the record and determine if the Commission's verdict is supported by substantial evidence.
The Court's function here is simply to determine if the Commissioners returned a verdict supported by substantial evidence or if, by its verdict, the Commission otherwise shocked the conscience of the Court. For the reasons explained above, substantial evidence supports the Commission's award.
As this Court observed in Dunkle v. Prettyman:
2002 WL 833375, at *2 (Del. Super. 2002).
While certainly not dispositive of the issue, the strict standard of review by which a motion for new trial is measured no doubt recognizes that it is the parties themselves who elect to present their claims to a jury of their peers, and, by so doing, it is the parties who activate the machinery which is our jury trial system. When the parties activate the jury trial system, they activate the risk inherent in the system. And, of course, trials by jury implicate the most risky element of dispute resolution: uncertainty.
Id.
"[T]hose of us involved in the judicial system cannot [and should not] make litigation risk-free." The State's motion is DENIED.
See Savage v. Cooke, 1995 WL 945563, at *1 (Del. Super. 1995).
IT IS SO ORDERED.