Phoenix Redevelopment Corp. v. Walker

812 S.W.2d 881, 1991 Mo. App. LEXIS 924, 1991 WL 103386
CourtMissouri Court of Appeals
DecidedJune 18, 1991
DocketNo. WD 43631
StatusPublished
Cited by8 cases

This text of 812 S.W.2d 881 (Phoenix Redevelopment Corp. v. Walker) 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
Phoenix Redevelopment Corp. v. Walker, 812 S.W.2d 881, 1991 Mo. App. LEXIS 924, 1991 WL 103386 (Mo. Ct. App. 1991).

Opinion

LOWENSTEIN, Judge.

Condemnor Phoenix Redevelopment Corporation 1 (“Phoenix”) appeals a verdict in favor of condemnee Timothy J. Walker.

Phoenix is a corporation created under Chapter 353 to redevelop an area of Kansas City known as Union Hill. Phoenix tried but was unable to buy Walker’s property located at 11-13 East 31st Street in Kansas City. Phoenix filed this petition to have the property condemned. The court appointed commissioners who awarded Walker $54,000 for the taking. Both parties filed exceptions, so a jury trial was conducted. The jury awarded Walker $78,-000 in damages. Phoenix received a credit for having paid the commissioners’ award plus interest, leaving a balance of $25,-887.48. This appeal followed.

Phoenix’s issues on appeal all concern the admissibility of comparable sales evidence.

The general rule of law is that a property owner is entitled to “just compensation” for the taking of his land. Mo. Const. Art. I, § 26. “Just compensation” is defined as what a reasonable buyer, who was willing but did not have to purchase, would give and what a seller, who was willing but did not have to sell, would take, with damages measured at the time of the taking. In re Armory Site in Kansas City, 282 S.W.2d 464, 470 (Mo.1955). Comparable sales prices, which are prices of properties similarly situated to that involved in the condemnation proceeding, are admissible to aid the jury in determining the amount of damages. Highway and Transp. Com’n v. Vitt, 785 S.W.2d 708, 713 (Mo.App.1990). The party seeking to admit comparable sales evidence bears the burden of showing that the sale was voluntary. Board of Public Bldgs. v. GMT Corp., 580 S.W.2d 519, 523 (Mo.App.1979); Highway and Transp. Com’n v. Vitt, 785 S.W.2d at 713. This burden is discharged prima facie, however, because the law presumes the sale price was “freely fixed and [884]*884not under compulsion.” Board of Public Bldgs. v. GMT Corp., 580 S.W.2d at 523. The burden then shifts to the opposing party to produce evidence that the sale was not voluntary. Id.

Jurisdictions are split on the issue of whether a purchaser’s power of eminent domain by itself renders a sale compulsory and not voluntary. The rule in Missouri is that the price of property sold to a purchaser with the power of eminent domain is admissible EXCEPT when (1) the offeror’s own evidence shows the sales were made after condemnation proceedings started; or (2) there is evidence from which a trial judge reasonably should have concluded that the sale was not voluntary; or (3) the opposing party produces other evidence that the sale was not voluntary. Board of Public Bldgs. v. GMT Corp., supra, 580 S.W.2d at 524. The court in Board of Public Bldgs, summed up the rule by stating that comparable sales figures should be excluded when the evidence shows the sale was made under the threat of condemnation. Id.; Highway and Transp. Com’n v. Vitt, 785 S.W.2d at 714. “Threat of condemnation” means that the condemning authority has a fixed purpose to institute condemnation proceedings if it cannot buy the property at a satisfactory price, or that the condemnor threatened the seller with condemnation if a satisfactory sale price was not agreed upon. Id.

Walker’s property, measures about 7,100 square feet. Prior uses of the property included a residence, a restaurant and a punk rock bar. The building was partially destroyed by fire before condemnation, and Walker seeks to have the property valued as vacant ground. Each party’s expert testified the highest and best use would be as vacant ground for future development because it was not feasible to rebuild the partially burned structure.

Walker introduced comparable sales evidence using five pieces of property in the Union Hill area. Walker relied most heavily on property located at 3101 to 3109 Main Street, Kansas City, Missouri. This property was separated from Walker’s property by an alley and will be referred to as the “Alley” property. This property was sold to the now demised predecessor of Phoenix, Union Hill in June 1989. The property measured about 13,246 square feet. Walker’s expert testified it sold for $250,000, and Phoenix’s expert testified it sold for $230,000. Including the cost of razing a prior-existing building, Walker’s expert testified that the price per square foot eq-ualled $20.63. Using this value as a comparable sale, Walker’s expert testified just compensation for his property was $117,-000.2

Walker’s expert also testified that the other four properties sold at prices ranging from $9.67 to $11.90 per square foot. Phoenix did not object to any of Walker’s comparable sales. On cross-examination, however, Phoenix elicited testimony the Alley property was sold under the threat of condemnation by Union Hill.

Phoenix in its case attempted to introduce comparable sales evidence of the sale of four parcels of property, all but one of which was located on the same block as the Alley and Walker properties. Walker objected on the basis that the sales were made under the threat of condemnation. The trial court interrupted the testimony of Phoenix’s witness to allow Phoenix to make an offer of proof.

The Phoenix offer of proof consisted of the following comparable sales:

(1) 3119 Main (admitted by trial court):
(a) Transaction date — March 1988
(b) Sale price — $50,000
(c) Square feet — 6,525
(d) Price per square foot — $7.66
(e) Seller — Bryant Upjohn Estate
(f) Prior Use — paved parking lot
(g) Voluntariness of Sale — Witness Block, president of Union Hill Acquisitions, which owns Phoenix Redevelopment Corp., testified Phoenix had the [885]*885power of eminent domain at the time of the transaction, but that Phoenix never threatened condemnation.
(2) 3117 Main (Marcone — not admitted):
(a) Transaction date — May 1988
(b) Sale price — $105,000
(c) Square feet — 6,525
(d) Price per square foot — not in the record
(e) Seller — Mrs. Burt Lyon
(f) Prior Use — Marcone Appliance Parts Co.
(g) Voluntariness of Sale — Witness Block testified Phoenix had the power of eminent domain at the time of the transaction, but that Phoenix never threatened condemnation.
(3) 12-22 East 31st Terrace (Prom Union Hill — not admitted):
(a) Transaction date — February 1988
(b) Sale price — $33,800
(c) Square feet — 28,400
(d) Price per square foot — $1.19
(e) Seller — Union Hill Development Co.

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Bluebook (online)
812 S.W.2d 881, 1991 Mo. App. LEXIS 924, 1991 WL 103386, Counsel Stack Legal Research, https://law.counselstack.com/opinion/phoenix-redevelopment-corp-v-walker-moctapp-1991.