City of Kansas City v. Chung Hoe Ku

282 S.W.3d 23, 2009 Mo. App. LEXIS 168, 2009 WL 365299
CourtMissouri Court of Appeals
DecidedFebruary 17, 2009
DocketWD 69807
StatusPublished
Cited by4 cases

This text of 282 S.W.3d 23 (City of Kansas City v. Chung Hoe Ku) is published on Counsel Stack Legal Research, covering Missouri Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
City of Kansas City v. Chung Hoe Ku, 282 S.W.3d 23, 2009 Mo. App. LEXIS 168, 2009 WL 365299 (Mo. Ct. App. 2009).

Opinion

*25 JOSEPH P. DANDURAND, Judge.

Chung Ho Ku and Myong Suk Ku (“the Kus”) appeal the judgment of the Circuit Court of Jackson County condemning real estate owned by the Kus. The trial court ruled in favor of the City of Kansas City, Missouri (“the City”). The Kus argue four points on appeal. They claim the trial court erred in entering a judgment of condemnation because: (1) there was no substantial evidence that the City engaged in good faith negotiations before filing a condemnation suit; (2) there was neither substantial evidence nor a factual finding by the court that the City complied with statutory time limitations in adopting the city ordinance authorizing condemnation; (3) there was no substantial evidence to support a legislative determination of blight and the blight determination was arbitrary, capricious, and induced by fraud, collusion or bad faith; and (4) the judgment was barred by the doctrines of res judicata and collateral estoppel. The points are denied, and the judgment is affirmed.

Background

Chung Ho Ku and Myong Suk Ku own a property (the Ku Property) commonly known as 1219-21 Grand Avenue in Kansas City, Missouri. The Ku Property is located near the Power & Light Entertainment District, Sprint Center, and H & R Block World Headquarters in downtown Kansas City.

On January 14, 2004, the Tax Increment Financing Commission of Kansas City (“the TIFC”) adopted a resolution recommending that the City Council of Kansas City (“the City Council”) approve the 1200 Main/South Loop Tax Increment Financing Plan (“the Redevelopment Plan”).

In March 2004, the City Council enacted an ordinance approving and adopting the TIFC’s recommendation regarding the Redevelopment Plan. The ordinance designated certain real estate as part of a Redevelopment Area pursuant to the Real Property Tax Increment Allocation Redevelopment Act (“the TIF Act”). § 99.820.ld). 1

In October 2004, the TIFC adopted a resolution recommending that the City Council approve a Second Amendment to the Redevelopment Plan. The Second Amendment expanded the boundaries of the Redevelopment Area to include, among other properties, the Ku Property. The City Council enacted such an ordinance, and the TIFC filed a petition in condemnation seeking to acquire the Ku Property. The circuit court dismissed the TIFC’s condemnation petition (“Ku I”) without prejudice, noting that pursuant to Section 99.820.1(3), property may not be condemned through the use of eminent domain unless such property is part of a redevelopment project. The circuit court noted that the TIFC admitted the Ku Property was not then part of such a project.

On November 9, 2005, the TIFC adopted a resolution recommending that the City Council approve a Fourth Amendment to the Redevelopment Plan. The Fourth Amendment expanded the boundaries of the Redevelopment Area and also provided for a mixed use redevelopment project, which was proposed by a private developer, 112 Redevelopers, LLC. The redevelopment project is to be located on numerous properties in the area, including the Ku Property.

*26 On May 11, 2006, the City Council, through its enactment of Ordinance No. 051532, approved the Fourth Amendment to the Redevelopment Plan. In the ordinance the City Council determined, among other things, that the Redevelopment Area as a whole was blighted. In making such a determination, the City Council had before it multiple blight studies.

Pursuant to statute, the City sent written notice by certified mail to each owner of record of the affected properties, which were all within the boundaries of the redevelopment project in the Redevelopment Area. The notice informed the property owners of the City’s intended acquisition. By certified mail notice dated September 10, 2007, the City offered to pay the Kus $390,500 to purchase the Ku Property. Attached to the City’s written offer to purchase was a copy of an appraisal done by Ed Severeid, which valued the property at $390,500. Mr. Severeid is a licensed appraiser in the State of Missouri. The Kus rejected the City’s offer and made a counteroffer of $2,000,000.

On October 4, 2007, the City Council enacted Committee Substitute for Ordinance No. 070923 (“ordinance substitute”) authorizing the City Attorney to file a condemnation petition to acquire the properties in the Redevelopment Area, including the Ku Property. In the ordinance substitute, the City Council found and determined continued redevelopment of the area and the reduction or elimination of blight to be a public use. The City Council declared it a public necessity to condemn and acquire fee simple title to the affected property. The City filed its petition in condemnation on November 6, 2007, and its amended petition on February 22, 2008. The case was set for trial on March 17, 2008.

At trial, in addition to arguing that the Ku Property was not blighted, the Kus also argued that the City did not lawfully engage in good faith negotiations because its offer of $390,500 was based on an appraisal that the Kus claimed was not performed in accordance with the standards set by the legislature for state-certified appraisers. The Kus’ expert, Maurice Kancel, a state-certified appraiser, valued the Ku Property at $1,200,000. Mr. Kan-cel testified that he performed an appraisal review of Mr. Severeid’s appraisal in accordance with the Uniform Standards of Professional Appraisal Practice (“US-PAP”). Mr. Kancel found that Mr. Sever-eid’s appraisal did not meet six out of the twenty standard USPAP requirements, and he further testified that he did not agree with Mr. Severeid’s analysis.

Mr. Ferguson, the City’s Right of Way Agent, testified on behalf of the City. In addition to being a state-certified appraiser, Mr. Ferguson has been responsible for the acquisition of properties in downtown Kansas City for several redevelopment projects. He also signed the City’s offer to purchase the Ku Property on behalf of the City. Mr. Ferguson noted that Mr. Severeid’s appraisal was done in accordance with generally accepted appraisal practices. He also testified that Mr. Sev-ereid discussed the three standard approaches to appraising property — the cost approach, the capitalization of income approach, and the comparative market approach — before selecting the comparative market approach as the most appropriate method to value the Ku Property. Mr. Ferguson stated that he approved of Mr. Severeid’s methodology.

The trial court found that the Redevelopment Plan and its amendments were prepared in accordance with the TIF Act and that the City had complied with all conditions precedent to this condemnation action. Accordingly, the trial court found *27 in favor of the City and ordered the Ku Property condemned.

This appeal followed.

Standard of Review

“This Court examines the record to determine whether there is substantial evidence to support the legislative decision.” Centene Plaza Redevelopment Corp. v. Mint Prop., 225 S.W.3d 431, 433 (Mo. banc 2007).

Point I

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Missouri Real Estate Appraisers Commission v. Funk
306 S.W.3d 101 (Missouri Court of Appeals, 2010)

Cite This Page — Counsel Stack

Bluebook (online)
282 S.W.3d 23, 2009 Mo. App. LEXIS 168, 2009 WL 365299, Counsel Stack Legal Research, https://law.counselstack.com/opinion/city-of-kansas-city-v-chung-hoe-ku-moctapp-2009.