City of New Orleans v. Lew

227 So. 2d 785
CourtLouisiana Court of Appeal
DecidedNovember 8, 1969
DocketNo. 3641
StatusPublished
Cited by1 cases

This text of 227 So. 2d 785 (City of New Orleans v. Lew) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
City of New Orleans v. Lew, 227 So. 2d 785 (La. Ct. App. 1969).

Opinion

HALL, Judge.

The City of New Orleans brought this expropriation proceeding to acquire a certain piece of property for a fire station. On December 6, 1968 judgment was rendered awarding compensation for the property to the defendant-owners, Moses Lew, Sylvia Lew and Dora Lew in the sum of $30,029.00 plus costs and expert’s fees together with interest thereon from date of judgment. The City of New Orleans appealed sus-pensively on February 10, 1969. Sylvia Lew died intestate on February 23, 1969 leaving as her sole and only heirs at law, her brother and sister, Moses Lew and Dora Lew, and by order of this Court dated March 12, 1969 Moses Lew and Dora Lew were substituted as sole defendants-appel-lees herein.

Moses Lew and Dora Lew answered the appeal praying that the compensation awarded for the property be increased to the sum of $30,600.00.

The property involved herein is situated in the First District of the City of New Orleans and is designated as lot 4 of Square 286. The lot forms the uptown lake corner of Melpomene and South Rampart Streets and measures 32' 11" 6'" front on Melpomene Street by a depth and front on South Rampart Street of 127' 9". It is zoned J-Industrial. Melpomene Street is a paved two-way street with a wide neutral ground. South Rampart is also a paved two-way street. The improvements on the lot consist of an old two-story brick building, a garage, and a small frame cottage.

The brick building fronts *on Melpomene Street and occupies the entire width of the lot and most of its depth. It has two side entrances on South Rampart Street. The garage is situated immediately behind the brick building and immediately behind the garage and occupying the entire remainder of lot 4 is a small frame cottage. The garage and cottage front on South Rampart Street.

Mr. V. B. “Bob” Warner testified as an expert appraiser on behalf of the City. Mr. Louis J. Herbert testified as an expert appraiser for the defendants.

Mr. Warner appraised the brick building and cottage using both the cost approach and the income approach. He stated that he used these approaches because there had been no sales of comparable properties in the area. Mr. Herbert in appraising the buildings used the cost approach alone stating that no data was available for using the income approach.

Using the cost approach Mr. Warner arrived at a depreciated value of $8,478.00 for the brick building without the land while Mr. Herbert calculated its depreciated value at $12,465.00. Both used $10.00 per square foot as its replacement cost. The difference between the two appraisals lies [787]*787in the fact Mr. Warner depreciated the replacement cost by 85% (being 55% for depreciation plus 30% for obsolescence) while Mr. Herbert used a depreciation factor of 75% allowing nothing for obsolescence.

Mr. Warner testified that he deducted 30% for functional obsolescence because if you replaced the building you would not use the same type of stairs or bath fixtures and would have to put in air conditioning ducts and such things as gas outlets and heaters. Mr. Herbert disagreed as to obsolescence stating that only the basic building should be appraised and that to change the stairs and fixtures and put in air conditioning ducts would result in updating the building.

Mr. Warner calculated the replacement cost of the frame cottage, without the land, at $3,960.00 which he depreciated by 40% and arrived at a depreciated value of $2,-376.00. Mr. Herbert calculated the replacement cost of the cottage at $3,776.00 which he depreciated by 25% arriving at a depreciated value of $2,822.00. Both calculated the replacement cost at $8.00 per square foot. The main difference between them lies in the depreciation factor.

Whereas by using the cost approach Mr. Herbert gave the garage a depreciated value of $561.00, Mr. Warner gave it no value at all since in his opinion the garage was worthless.

In appraising the land Mr. Warner gave a separate value to the land occupied by the brick building and garage from that which he placed on the land occupied by the cottage. Since in his opinion the garage itself was worthless he added the area occupied by it to the area of the land occupied by the brick building and arrived at a land valuation for this combined area of $8,059.00 using $2.20 per square foot as a basis.

That portion of lot 4 which is occupied by the cottage fronting on South Rampart Street was appraised by Mr. Warner at $1,666.00. He pointed out that this portion measures 17' front on South Rampart Street but has a depth of only 33' (being the width of lot 4). He estimated the value of this portion of lot 4 at $175.00 per front foot arriving at a figure of $2,975.00 which he reduced to $1,666.00 on account of its shallow depth using the Milwaukee Depth Table.

Mr. Herbert, on the other hand, did not divide his land appraisal but instead appraised the entire area of lot 4 at approximately $3.50 per square foot giving lot 4 an overall land value of $14,755.00.

Mr. Warner gave no basis for his use of $2.20 per square foot in valuing the land occupied by the brick building and garage. Neither did he give any basis for valuing the land occupied by the cottage at $175.00 per front foot.

Mr. Herbert stated that in his opinion land in this area could not be acquired for $2.20 per square foot and in appraising the lot at $3.50 per square foot referred to several sales which he regarded as comparables in fixing land values. An examination of these sales reveals that all of them were sales of improved property and that no separate prices for the land were stated therein. The record reveals that there were no comparable sales of vacant land. However, Mr. Herbert testified that the improvements on several of the properties referred to by him were so old and in such bad condition that they had to be torn down and that the sales prices reflected that a substantial value was paid for the land which, in his opinion, amounted to approximately $3.50 per square foot.

By using the cost approach Mr. Warner arrived at a total value for the land and improvements of $16,550.00 for the brick building and $4,050.00 for the cottage making a total of $20,600.00. He then by using the income approach arrived at a valuation of $15,400.00 for the brick building and $3,-850.00 for the cottage for a total of $19,250.-00. After giving consideration to both approaches Mr. Warner’s final appraisal of the property was $19,850.00, being $16,-[788]*788000.00 for the brick building and $3,850.00 for the cottage.

Mr. Herbert’s appraisal of the entire property using the cost approach adds up to $30,600.00 which includes $561.00 for the garage which Mr. Warner testified had no value whatever. Mr. Herbert did not use the income approach, explaining that the property had been owned by the defendants’ family for over 50 years; that throughout the years the lower floor had been used by them as a second hand furniture store and that most of the upper floor had been used for furniture storage; that with the exception of a small apartment on the second floor the property had not been rented for over 50 years and there was no way to put a rental value on the building. He pointed out that in using the income approach Mr. Warner had to hypothesize a rent figure which he reduced by a vacancy factor of 5% and after deducting estimated annual expenses consisting of taxes, insurance, maintenance expense and a 6% management fee arrived at a figure which he capitalized at 12%. Mr.

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Bluebook (online)
227 So. 2d 785, Counsel Stack Legal Research, https://law.counselstack.com/opinion/city-of-new-orleans-v-lew-lactapp-1969.