North Carolina State Highway Commission v. Helderman

207 S.E.2d 720, 285 N.C. 645, 1974 N.C. LEXIS 1066

• Court: Supreme Court of North Carolina
• Decided: August 30, 1974
• Docket: 33
• Status: Published

Opinion

SHARP, Justice.

The position of defendants (appellants here, appellees below) is that plaintiff’s assignments of error neither singly nor collectively disclose any error sufficiently prejudicial to justify the trial de novo ordered by the Court of Appeals.

On this appeal we do not consider any assignment which the Court of Appeals decided adversely to plaintiff, that is, overruled. We examine first plaintiff’s assignment No. 3, which the Court of Appeals sustained, that the trial court erred in permitting one of the owners, defendant J. R. Helderman, to express an opinion as to the value of his property before and after the taking without any showing that he was qualified to give such an opinion. This assignment raises the question whether the owner of property is ipso facto presumed qualified to give an opinion as to its market value.

Unless it affirmatively appears that the owner does not know the market value of his property, it is generally held that he is competent to testify as to its value even though his knowledge on the subject would not qualify him as a witness were he not the owner. “He is deemed to have sufficient knowledge of the price paid, the rents or other income received, and the possibilities of the land for use, to have a reasonably good idea of what it is worth. The weight of his testimony is for the jury, and it is generally understood that the opinion of the owner is so far affected by bias that it amounts to little more than a definite statement of the maximum figure of his contention. ...” 5 Nichols, Law of Eminent Domain, § 18.4(2) (3rd ed., 1969), wherein the decisions pro and con are collected. Accord, 32 C.J.S., Evidence § 546 (116) (1964) ; 32 C.J.S., Evidence § 545(d)(3) (pp. 305-306) (1942); Jahr, Law of Eminent Domain § 133 (1953) ; 3 Wigmore on Evidence, §§ 714, 716 (Chadbourn rev. 1970). See Light Co. v. Rogers, 207 N.C. 751, 753, 178 S.E. 575, 576 (1935). For an exposition of the minority rule that the owner, just as any other witness, must establish his qualifications before expressing his opinion of market value, see Commonwealth, Department of Highways v. Fister, 373 S.W. 720 (Ky., 1963).

When his attorney asked defendant Helderman if he was familiar with the fair market value of real estate in the vicinity of his property and if he had an opinion satisfactory to himself as to the fair market value of his property on and after 7 August 1972, he answered both questions, “Yes, sir. I think so.” The market value of land is usually a matter of opinion, and we interpret defendant’s answers as a positive assertion that he knew land values in the vicinity of his property and had an informed opinion, “satisfactory to himself,” as to the value of his property on the pertinent date. In Harrelson v. Gooden, 229 N.C. 654, 50 S.E. 2d 901 (1948), an owner’s similar assertion was held sufficient to establish prima facie his qualifications to testify as to value. The Court said, “This evidence was not incompetent. Its probative value, subject to being tested on cross-examination, was for the jury.” Id. at 657, 50 S.E. 2d at 903. (See 32 C.J.S., Evidence § 546 (115), n. 65 at p. 432 (1964), for comment on Harrelson v. Gooden, supra.)

In our view, Helderman was entitled to testify to the value of his property. However, the short answer to plaintiff’s contention that it was error to permit him to do so is that counsel did not object to the questions which elicited his estimates of the value of the property before and after the taking. We hold that plaintiff’s assignment of error should have been overruled.

The assignment of error No. 5 which plaintiff stresses most forcibly is directed to Judge McLean’s refusal to grant its motion for a mistrial after the following incident, which has been more fully described in the preliminary statement of facts. After the court had ruled that the purchase price paid in asserted “comparable sales” considered by the realtors in valuing defendants’ land would not be admitted in evidence, defendants’ attorney asked the witness Laughridge what one such “comparable”, one-acre tract (the Lender lot) “sold for.” Notwithstanding the court sustained plaintiff’s objection, the witness answered, “$45,000.” Both the question and answer set at naught the court’s ruling. Right or wrong, the ruling should have been respected by both attorney and witness. At that time no witness except the owner had given his opinion as to the value of the land, and, at that stage of the trial, Judge McLean would have been within bounds had he allowed the motion for a mistrial. Instead, however, he allowed plaintiff’s motion to strike and instructed the jurors that they would “not consider that statement.”

We are unable to determine from the record whether the court correctly ruled that the sales price of the Lender land, or that of the other tracts which defendants’ witnesses considered comparable in arriving at their valuation of defendants’ property, was inadmissible evidence. The question of admissibility was not determined in accordance with the decisions of this Court. If the sales were in fact comparable, the price was admissible ; otherwise, not. If the properties or sales were not comparable the court erred in allowing the witnesses to describe the land sold to the jury, to state that they deemed the sales comparable and had considered the sales prices in determining the values they had placed upon defendants’ property. In any event, the ruling of the court, which permitted the witnesses to describe the sales as comparable while excluding the sales price, was inconsistent. However, neither party excepted to the ruling.

In this State the rule is well settled “that the price paid at voluntary sales of land, similar in nature, location, and condition to the condemnee’s land, is admissible as independent evidence of the value of the land taken if the prior sale was not too remote in time. Whether two properties are sufficiently similar to admit evidence of the purchase price of one as a guide to the value of the other is a question to be determined by the trial judge in the exercise of a sound discretion guided by law.” State v. Johnson, 282 N.C. 1, 21, 191 S.E. 2d 641, 655 (1972). See Redevelopment Comm. v. Panel Co., 273 N.C. 368, 159 S.E. 2d 861 (1968). The approved practice is for the judge to conduct a voir dire, to hear testimony in the absence of the jury as a basis for determining the admissibility of such evidence. Barnes v. Highway Commission, 250 N.C. 378, 109 S.E. 2d 219 (1959) ; Highway Commission v. Pearce, 261 N.C. 760, 136 S.E. 2d 71 (1964) ; Highway Commission v. Coggins, 262 N.C. 25, 136 S.E. 2d 265 (1964) ; Carver v. Lykes, 262 N.C. 345, 137 S.E. 2d 139 (1964).

After the denial of plaintiff’s motion for a mistrial defendants’ witnesses testified without objection as to the valuations which they had placed upon defendants’ land, and plaintiff’s witnesses explained to the jury why, in their opinion, the asserted comparable sales were not, in fact, comparable. In their turn, without the judge having conducted a voir dire, plaintiff’s witnesses likewise described lands which they asserted were comparable to defendants’ and testified that they had based their valuations of defendants’ property upon the sales price of these tracts.

Under all the circumstances we cannot say that the court’s failure to allow the motion for a mistrial constituted prejudicial error. Where the judge sustains a motion to strike an answer of a witness and immediately cautions the jury not to consider it, it will be assumed that the jury followed the instruction and no prejudice resulted. Apel v. Coach Co., 267 N.C. 25, 147 S.E. 2d 566 (1966) ; 7 Strong’s North Carolina Index 2d, Trial § 16 (1968). Assignment of error No. 5 is not sustained.

Plaintiff’s assignment No. 6 is that the trial court erred “in allowing defendants’ witness Laughridge to testify that in forming his opinion of value he investigated the asking price which owners of similar property in that area were demanding.” (Emphasis added.)

As this Court said in Highway Commission v. Coggins, supra at 31, 136 S.E. 2d at 269, “It is not the offering of property at a given price that furnishes evidence of market value; it is the actual sale by ‘a seller willing but not obliged to sell, to a buyer willing but not obligated to buy.’ An owner may and fre quently does place a higher price on his property than it will bring in the market. It is not until a voluntary buyer is willing to take the property at the stated price that the transaction becomes an indication of market value.” See Canton v. Harris, 177 N.C. 10, 12, 97 S.E. 748, 749 (1918). A mere offer to buy or sell property is incompetent to prove its market value. The figure named is only the opinion of one who is not bound by his statement and it is to unreliable to be accepted as a correct test of value. State v. Lincoln Memory Gardens, Inc., 242 Ind. 206, 177 N.E. 2d 655 (1961) ; State v. Morehouse Holding Company, 225 Ore. 62, 357 P. 2d 266 (1960) ; Thornton v. Birmingham, 250 Ala. 651, 35 So. 2d 545, 7 A.L.R. 2d 773 (1948). See Annot., 7 A.L.R. 2d 781 (1948) ; McCormick on Evidence, § 166 (1954) ; 1 Orgel, Valuation under Eminent Domain § 148 (1953).

The rule is firmly established that mere offers, whether made by the owner of comparable properties or to him, are inadmissible. “The objections to the reception of evidence of offers to buy the identical land which is taken are multiplied ten fold in the case of other land in the neighborhood, and if offers for neighborhing land were competent, the trial of a land damage case would degenerate into a confused and endless wrangle in which collateral issues and what is, in substance, hearsay evidence would play the most prominent part.” 5 Nichols, supra, § 21.4(3) (1969). However, an offer by the owner, made at or about the time of the taking, to sell his land for a lesser price than he now contends it is worth, is competent to contradict his present contention. Id. § 21.4(2). See Jahar, supra, § 145 (1953).

In his testimony Laughridge did not state the asking price of any of the “comparable” properties in the vicinity, and he did not base his opinion solely on them or upon any other one factor. His statement was that, among other things, he investigated the asking prices and then considered everything he knew in arriving at his estimates of value. The prejudice here, if any, would not have come from his statement that the asking prices were a part of the general information upon which he based his opinion. The question is whether the fact that these prices were a part of his general knowledge and he did not exclude them from his considerations required the rejection of his opinion. The answer is No.

Although the witness should consider only proper elements of value, unless he “has based his opinion in a material degree upon elements which cannot legally be considered, without sep arating such elements from those which may legally be considered, without separating such elements from those which may legally be considered, such opinion is not incompetent.” 5 Nichols, supra, § 18.42 (1) (1969). The element complained of here affects the weight rather than the competency of the evidence. In Highway Commission v. Conrad, 263 N.C. 394, 399, 139 S.E. 2d 553, 557 (1964), this Court quoted with approval the following statement from People v. Gangi Corporation, 15 Cal. Rep. 19, 25 (1961), rev’d on different grounds sub nom. People v. Donovan, 57 Cal. 2d 346, 19 Cal. Rep. 473 (1962) : “ ‘An integral part of an expert’s work is to obtain all possible information, data, detail and material which will aid him in arriving at an opinion. Much of the source material will be in and of itself inadmissible evidence but this fact does not preclude him from using it in arriving at an opinion. All of the factors he has gained are weighed and given the sanction of his experience in his expressing an opinion.’ ” This statement appears to describe the manner in which Mr. Laughridge arrived at the opinions he expressed. It was not error for the court to permit him to detail the facts upon which he based his opinions. Highway Commission v. Conrad, supra. However, we again note that his opinions went into evidence without objection from plaintiff. We find no merit in assignment No. 6.

Finally we consider assignment No. 16, which challenges the following portion of Judge McLean’s charge: “As the court has heretofore instructed, Members of the Jury, the measure of damages is the difference between the fair market value of the property immediately before the taking and the fair market value of the remainder of the tract after the taking, which shall include the value of the property taken plus damages to the adjoining property.” (Italics ours.) Plaintiff’s exception relates to the use of the italicized word “adjoining-.” What the judge intended to say, of course, was “remaining” property. He had previously instructed that the measure of damages for the taking was “the difference between fair market value of the entire tract immediately prior to said taking and the fair market value of the remainder immediately after said taking.” (Italics ours.)

Plaintiff contends that “damages to the adjoining property have no bearing upon damages to the subject property and do not enter into the case.” We consider this contention so obviously true that it is inconceivable to us the jury could have thought the judge was referring to property belonging to others which adjoined defendants’ original 2.41 acres. On the contrary, the jurors must have understood that his Honor meant defendants’ remaining property which then adjoined the .22 acres taken. Our opinion is bolstered by the fact that defendants owned no other property in the area.

After having examined all of plaintiff’s assignments, it is our decision that none disclose error in law sufficiently prejudicial to require a new trial.

Plaintiff’s argument on its assignment that the judge erred in refusing to set aside the verdict because it was an excessive award is no doubt the same argument its counsel directed to the jury before verdict and to the judge thereafter. The trial judge’s refusal to set aside a verdict for excessiveness “will not be disturbed on appeal unless it is obvious that he abused his discretion,” and no such abuse of discretion appears in this case. Right v. Seymour, 263 N.C. 790, 792, 140 S.E. 2d 410, 413 (1965) ; 7 Strong’s North Carolina Index 2d, Trial, § 52 (1968). Perhaps a comment appearing in Brown v. Power Co., 140 N.C. 333, 348, 52 S.E. 954, 960 (1905) is pertinent here: “As long as witnesses differ so widely in their opinion as to values, and as long as litigants measure value so entirely by the standard of self-interest, we cannot hope for verdicts that shall be satisfactory to both parties. The utmost to which we can hope to attain is to sometimes reach a verdict that is unsatisfactory to both parties.”

The decision of the Court of Appeals is

Reversed.