State, Dept. of Highways v. Bitterwolf

415 So. 2d 196, 1982 La. LEXIS 11017
CourtSupreme Court of Louisiana
DecidedMay 17, 1982
Docket81-C-1646
StatusPublished
Cited by40 cases

This text of 415 So. 2d 196 (State, Dept. of Highways v. Bitterwolf) is published on Counsel Stack Legal Research, covering Supreme Court of Louisiana primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State, Dept. of Highways v. Bitterwolf, 415 So. 2d 196, 1982 La. LEXIS 11017 (La. 1982).

Opinion

415 So.2d 196 (1982)

STATE of Louisiana Through the DEPARTMENT OF HIGHWAYS
v.
Gordon BITTERWOLF.

No. 81-C-1646.

Supreme Court of Louisiana.

May 17, 1982.
Rehearing Denied July 2, 1982.

*197 Bryan Miller, Johnnie E. Branch, Jr., William W. Irwin, Jr., Bernard L. Malone, Jr., Richard N. Burtt, Harvey Lee Hall, Baton Rouge, for plaintiff-applicant.

Clint L. Pierson, Jr., of Pierson & Buras, Covington, for defendant-respondent.

DENNIS, Justice.

We granted writs in this "quick taking" expropriation suit to determine whether the rule, that compensation for property taken is to be measured without considering any change in value caused by the proposed improvement for which the property is taken, is applicable if the expropriatee purchased the property, in an arms-length transaction, after the value of the property had already been reduced by the prospect of the expropriation action.

The fact that a public improvement has been proposed may cause a change in property values in the neighborhood through which it will pass. Land values may rise or fall before any property is taken if the projected public work is perceived as beneficial or injurious to its surroundings. See, 4 Nichols on Eminent Domain, § 12.3151 (3rd ed. 1981). This court has long held, in accord with civil code precepts designed to prevent overestimation of an owner's true loss, that the valuation of property expropriated must be reduced by any increase caused by the fact that the improvement was proposed. The "quick taking" statute was amended effective January 1, 1975 to prevent underestimation, as well as overestimation, by providing that the measure of compensation for property expropriated for highway purposes shall be determined "without considering any change in value caused by the proposed improvement for *198 which the property is taken." La.R.S. 48:453(A) (Supp.1975) [emphasis added]

The question presented by this case is whether the quick taking statute affords a property owner a right to recover, in addition to the value of his property taken, compensation for the depreciation in its value caused by the proposed project before he acquired the property. The trial court and court of appeal, applying La.R.S. 48:453(A) in isolation from constitutional and other statutory precepts, approved the award of such compensation. We reverse. An owner cannot recover more than compensation to the full extent of his loss for property taken or damaged by the state. Although the constitutional right to property does not prohibit the state from compensating an owner for more than the full extent of his loss, it has never been the aim of our implemental legislative and jurisprudential precepts to require anything more than just compensation for the owner's loss. La.R.S. 48:453, which was amended to incorporate these precepts and the constitutional principle of just compensation, is designed to compensate an owner only to the full extent of his loss.

Statement of Facts

The State of Louisiana, through the Department of Highways instituted this suit to expropriate a tract of land in St. Tammany Parish fronting on U. S. Highway 190 from the defendant, Gordon J. Bitterwolf. The land was needed as part of a State and Federal project to widen, improve and surface State Route La-U.S. 190 as a controlled access highway.

The record reveals that in 1968 the state of Louisiana made an announcement that La-U.S. 190 and the North Causeway approach from I-12 to Lake Pontchartrain Causeway would be a controlled access highway. Service roads would be erected on the property fronting U.S. 190 and only two interchanges were contemplated in the immediate area. The effect of this announcement resulted in depressing property values south of the interstate.[1]

Mr. Gordon Bitterwolf bought a 1.34 acre tract of land (consisting of 57,717 square feet) located within the area of depressed property values, on March 10, 1973, from Edward A. Elfer for $48,000. The purchase was some four and one-half years after the state's announcement and less than two years before the expropriation in this case by the state.

An order of expropriation was signed by the Court on February 3, 1975. On the same day the State deposited into the registry of the court the sum of $21,395.00 which represented the state's estimated value of the land expropriated. The state took 22,520 square feet of the undeveloped land with 75 feet being front footage. After withdrawing the funds deposited, Bitterwolf answered the petition of the State alleging that the just compensation for the property taken and severance damages to the remainder was in the amount of $75,000.00.

At trial both the state and the property owner introduced the testimony of appraisers on the issues of compensation for the property taken or damaged. The state's appraisers relied on comparable sales of property within the neighborhood of the taking which had been depressed in value by the proposal of the project. The property owner's appraisers used comparable sales from an area outside the immediate vicinity of the subject property, in which property values had not been adversely affected by the announcement of the project.

Trial and Appellate Court Decisions

The trial court awarded Mr. Bitterwolf $41,662.96 for the property taken and $29,917.01 for severance damages to his remainder. The court of appeal affirmed these *199 awards,[2] holding that Mr. Bitterwolf was entitled to be compensated for the depreciation in property value caused by the project's announcement, by virtue of La. R.S. 48:453(A)'s ban against "considering any change in value caused by the proposed improvement for which the property is taken," despite the fact that he acquired the entire property four years after the state's announcement.

Issue Presented

We granted writs to consider whether La.R.S. 48:453 requires the courts to disregard depreciation of property values caused by the proposal of a project even when the defendant property owner purchased at the depressed value and therefore sustained no loss caused by the fact that the project was proposed.

Just Compensation to the Full Extent of An Owner's Loss

Property cannot be "taken or damaged" by the state or its political subdivisions except for public purposes and with "just compensation" paid to the owner or into court for his benefit. La.Const.1974, Art. 1, § 4. In every expropriation, the owner must be compensated to the "full extent of his loss." Id. Thus, our constitution does not simply require that the owner of condemned property be compensated with the market value of the property taken and severance damages to his remainder, but that he be "placed in as good a position pecuniarily as [he] enjoyed prior to the taking." State v. Constant, 369 So.2d 699, 702 (La.1979). See Note, Expropriation: Compensating the Landowner to the Full Extent of His Loss, 40 La.L.Rev. 817 (1980).

Compensation for Property Taken

Under previous Louisiana constitutions, the legislature and the courts have developed rules which accepted market value as a relevant consideration in determining just compensation, but which also required adjustments of market value to prevent effects of a project's proposal itself from distorting a calculation of the owner's true loss.

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415 So. 2d 196, 1982 La. LEXIS 11017, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-dept-of-highways-v-bitterwolf-la-1982.