Smith v. State Department of Transportation & Development

872 So. 2d 594, 3 La.App. 3 Cir. 1450, 2004 La. App. LEXIS 1058
Louisiana Court of Appeal·Decided April 28, 2004·No. No. 2003-1450·Published·Cited by 2 cases

Opinion

I,COOKS, Judge.

This appeal arose from Ken Smith’s compensation claim against the State of Louisiana, Department of Transportation & Development (hereafter DOTD) for the inverse condemnation of his business location.

Ken Smith owned B & K Music in Kinder, Louisiana, which was located at the intersection of Highway 165 and Highway 190. The Town of Kinder owned the land where the building was located. Mike Unkel leased the land from the Town for $400.00 per year, and had been doing so for approximately forty years. Unkel owned the building located on the property and subleased the property and building to Smith for $200.00 per month. This arrangement had been ongoing for nearly twenty years. The lease between Unkel and Smith provided Smith could lease the property for as long as he desired.

With the opening of the Grand Casino Coushatta nearby, traffic on Hwy. 165 substantially increased. The State determined Hwy. 165 needed widening. To accomplish this end, the State deemed it necessary to expropriate the land where B & K Music was located.

DOTD’s appraiser valued the building on the site at $34,500.00. The building had been appraised years earlier at $24,000.00. Despite the amount of its appraisal, DOTD offered Unkel $208,000 for the building. Smith received an eligibility letter from DOTD, notifying him that he might be eligible for an award because of the expropriation. Smith was informed by DOTD he would have to move from the land in 90 days. Attempts by Smith and DOTD to find another location on Hwy. 165 were unsuccessful. Eventually, he was forced to renovate and move into a building he owned, located well off of Hwy. 165.

As a tenant, Smith was then entitled to seek moving expenses, the expenses of | ¡.reestablishing his business, reimbursement for improvements, loss of leasehold advantage and loss of business attributable to a new location.

According to Smith, when the DOTD mistakenly agreed to pay Unkel $208,000 for the building, it then “attempted to mitigate its damages by insisting that Smith get his just compensation from Unk-el.” Unkel refused. Smith argued DOTD then devised a plan where “in an attempt to avoid paying Smith any compensation, the DOTD would ignore its own regulations and would stonewall Smith. Unkel, in turn, would attempt to evict Smith. If Unkel were successful, the DOTD would take the position that Smith, as a former tenant, was not entitled to any compensation.”

Smith filed a lawsuit in November 1999 against DOTD. There were disputes as to DOTD’s compliance with producing all required documents to Smith. Although the trial court found DOTD did not “fully and accurately respond to plaintiffs discovery requests” and “said failure to produce directly affected plaintiffs ability to present its case and/or to cross-examine DOTD’s witnesses,” the trial court could not determine whether the failure was “an act of omission or commission by DOTD.” Thus, the trial court did not sanction DOTD as requested by plaintiff.

The jury found DOTD did “take or damage Ken Smith’s property or business without compensating him fully for his loss,” and awarded Smith $15,260.00, which [597]*597consisted of $10,000.00 for cost of relocation, $4,760.00 for moving expenses, and $500.00 for loss of improvements. The jury did not make awards for loss of leasehold advantage, loss of business, or loss of opportunity. Smith filed a Motion for Judgment Notwithstanding the Verdict (JNOV) because of the jury’s failure to make those awards.

The trial judge denied the JNOV with respect to the loss of business and loss of opportunity arguments. However, finding the “evidence and the reasonable Isinferences point so strongly in favor of plaintiff on the issue of leasehold advantage that reasonable persons could not arrive at a contrary verdict,” the trial court granted that portion of the JNOV. Both DOTD’s and Smith’s experts established the leasehold advantage (which was defined as the difference between the contract rent less the market rent) was $1,000.00 per month. While defendant’s expert testified that the lack of a specific term of lease made it impracticable to value the future leasehold advantage, Smith’s expert testified the leasehold advantage for five years was $56,027.00 and $100,647.00 for ten years. Accordingly, the trial court awarded Smith $100,647.00 for leasehold advantage. A judgment was prepared reflecting the jury’s verdict plus the JNOV. The judgment also awarded Smith $78,428.00 in attorney fees, $12,742.75 in expert witness fees and $5,290.64 in expenses.

DOTD appealed the trial court’s judgment, arguing the JNOV awarding $100,647.00 for leasehold advantage was improperly granted and the trial court’s award of $78,428.00 in attorney fees was an abuse of discretion. Smith answered the appeal and argued the jury and trial court erred in not awarding damages for loss of business, loss of opportunity and inconvenience. He also alleged the trial court erred in failing to sanction DOTD for failure to produce requested documents. Lastly, Smith requested attorney fees for the work necessitated by this appeal.

ANALYSIS

We note the jury’s decision that DOTD took Ken Smith’s property without fully compensating him is not at issue in this appeal. The parties are disputing the damage and attorney fee award conclusions made by the jury and trial judge.

I. The Motion for JNOV.

The trial court granted Smith’s Motion for JNOV in part, awarding $100,647.00 for leasehold advantage, and denied it in part, refusing to award Smith | ¿damages for loss of business and loss of opportunity. DOTD contends the trial court erred in granting the JNOV on the issue of leasehold damages and Smith asserts the trial court and jury erred in not making awards for loss of business and loss of opportunity.

La.Code Civ.P. Article 1811 establishes the authority for a JNOV. It provides that a JNOV may be granted on the issue of liability or on the issue of damages or on both. The Louisiana Supreme Court in Davis v. Wal-Mart Stores, Inc., 00-445 pp. 4-5 (La.11/28/00), 774 So.2d 84, 89, discussed the standard to be used in determining whether a JNOV has been properly granted:

A JNOV is warranted when the facts and inferences point so strongly and overwhelmingly in favor of one party that the court believes that reasonable jurors could not arrive at a contrary verdict. The motion should be granted only when the evidence points so strongly in favor of the moving party that reasonable men could not reach different conclusions, not merely when there is a preponderance of evidence for the mover. If there is evidence opposed to the [598]*598motion which is of such quality and weight that reasonable and fair-minded men in the exercise of impartial judgment might reach different conclusions, the motion should be denied. In making this determination, the court should not evaluate the credibility of the witnesses and all reasonable inferences or factual questions should be resolved in favor of the non-moving party.
The standard of review for a JNOV on appeal is a two part inquiry. In reviewing a JNOV, the appellate court must first determine if the trial court erred in granting the JNOV. This is done by using the aforementioned criteria just as the trial judge does in deciding whether or not to grant the motion.

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Smith v. State Department of Transportation & Development, 872 So. 2d 594, 3 La.App. 3 Cir. 1450, 2004 La. App. LEXIS 1058 (La. Ct. App. 2004).

872 So. 2d 594 (Smith v. State Department of Transportation & Development) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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