State, Dotd v. Cole Oil and Tire Co., Inc.

975 So. 2d 765, 2008 La. App. LEXIS 196, 2008 WL 373596
CourtLouisiana Court of Appeal
DecidedFebruary 13, 2008
Docket43,030-CA
StatusPublished

This text of 975 So. 2d 765 (State, Dotd v. Cole Oil and Tire Co., Inc.) 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
State, Dotd v. Cole Oil and Tire Co., Inc., 975 So. 2d 765, 2008 La. App. LEXIS 196, 2008 WL 373596 (La. Ct. App. 2008).

Opinion

975 So.2d 765 (2008)

STATE of Louisiana, DOTD, Plaintiff-Appellant
v.
COLE OIL AND TIRE CO., INC., Defendant-Appellee.

No. 43,030-CA.

Court of Appeal of Louisiana, Second Circuit.

February 13, 2008.

Bernard L. Knobloch, Jr., for Appellant.

Anna E. Dow, Martin S. Sanders, III, Baton Rouge, for Appellee.

Before STEWART, GASKINS and LOLLEY, JJ.

STEWART, J.

The State of Louisiana, through the Department of Transportation and Development (hereafter "DOTD") appeals a judgment awarding Cole Oil and Tire Company, Inc., (hereafter "COT") a total $372,642, plus costs and attorney fees, as just compensation for an expropriation of land to widen a highway. Finding no reversible error, we affirm the trial court's judgment with an amendment of the expert fees.

FACTS

COT operated a bulk fuel plant in Jonesboro, Louisiana, alongside LA-US 167 on a triangular tract of land with a railroad right of way running along the rear of the tract. On March 10, 1997, DOTD filed a petition to expropriate part of the property (16,243 square feet) to widen the highway and deposited $10,267 into the registry of the court as just compensation for the taking. COT answered the petition on April 18, 1997, to demand total compensation of $460,000. COT claimed that the taking damaged the remainder of the property by rendering it unfit for operations of a bulk fuel plant due to the proximity of the fuel storage tanks to the highway right of way. Only by reconfiguring the site would COT be able to continue operations at its Jonesboro location.

Almost ten years after the taking, the issue of compensation due COT went to trial. For the intervening procedural history of this matter, which is not directly related to the issue before us now, see State of Louisiana, DOTD v. Cole Oil & Tire Co., Inc., 36,122 (La.App. 2d Cir.7/17/02), 822 So.2d 229, writ denied, 2002-2325 (La.11/15/02), 829 So.2d 436.

*767 At trial, Albert F. Cole, the majority shareholder of COT, testified that the taking made the site unsafe for continued operations of the bulk fuel plant and that he could no longer obtain insurance for operating the plant. Apparently, the taking placed the plant operations in violation of a National Fire Protection Act (NFPA) guideline that required a distance of at least 25 feet between tank car loading and uploading facilities dispensing Class I liquids and the nearest line of adjoining property that can be built upon. Cole testified that the loading dock was within 13 feet of the highway right of way line as shown by markers that DOTD had put down and the placement of a telephone pole. Though he had not surveyed the distance, he stated that his lawyers and others had measured it. Cole asserted that because he was unable to get insurance for the operations, he closed the tanks. However, the date of closure was not clearly established. Records for the Department of Environmental Quality ("DEQ") showed that the tanks were out of service by 1998.

Cole also testified that the tanks could not be moved back on the property due to the presence of a railroad right of way and the fire danger posed by sparks from the railroad tracks igniting the overgrown brush on the right of way. He claimed that the only way to continue operations on the site would be to demolish the existing improvements and rebuild in a new configuration that would satisfy all applicable safety standards.

The need to and manner of reconfiguring the site was determined by engineers consulted by COT's real estate appraiser, James A. Young. According to Young, the cost of demolishing the existing facilities and rebuilding the site would total $403,068 as of the date of trial. His appraisal of compensation for the taking only amounted to $10,512. Young admitted that he did not determine the distance from the loading rack to the highway right of way and that he relied on the report from engineers with Jones Brothers Co., Inc., in making his appraisal. The Jones report did not include specific information about why the site would have to be reconfigured. It stated only that the proposed layout would be in compliance with current codes and regulations applicable to fuel facilities and adjacent rights of way.

Ronnie Rabalais, an expert in construction costs, testified on behalf of DOTD, which asked him to determine the replacement costs of improvements on the site and whether changes were needed for operations to continue. Rabalais opined that the loading racks were set back far enough from the highway right of way to meet regulatory requirements. He also believed that the NFPA setback requirements would not apply to the highway right of way, which was not an area on which anything would be built. COT objected to this testimony as outside of Rabalais's area of expertise, and the trial court sustained the objection. Rabalais testified that COT could continue operations on the site without rebuilding, and he referred to other bulk fuel plants he had seen or inspected that were located closer to highway or railroad rights of way. However, he did not know whether these facilities were insured. Finally, Rabalais estimated replacement costs, if owed, to be $326,700 as of the date of the taking.

Another DOTD witness from the petroleum marketing industry, John Fontenot, also testified that COT could continue operating under the present conditions. But Fontenot said he would not operate without insurance.

Finally, DOTD presented its own appraiser, Richard K. Moore, who had done an initial appraisal report prior to the taking and a second report in 2004. Moore's *768 initial report determined the market value of the property taken to be $10,543, and the severance value of the remaining property to be $8,500, for a total of $19,043. His 2005 report updated these figures to $15,300 for the property taken and $9,000 for the severance damages for a total of $24,300. These figures were based on the assumption that setback requirements were met. His calculation of replacement costs for the improvements, as indicated in his appraisal report, totaled $326,700 as of November 19, 2004.

After considering the testimony and documents offered into evidence, the trial court ruled in favor of COT, awarding it $15,300 for the value of the property taken, $326,700 in replacement costs without depreciation for the improvements, $20,642 for demolition, and $10,000 for grading and rebuilding preparations. These awards totaled $372,642, and with the $10,267 already paid by DOTD, left $362,375 remaining to be paid with legal interest from the filing date of COT's answer. The trial court also awarded attorney fees totaling $90,593.75, and costs associated with COT's appraiser, James Young, totaling $27,400. DOTD has appealed this judgment.

DISCUSSION

DOTD first argues that the trial court erred in overruling its hearsay objections to two letters offered by COT in support of Mr. Cole's testimony. The first letter, which is dated March 15, 1996, was written to Mr. Cole from COT's insurer, Federated Insurance, regarding an inquiry by its Louisiana consultant about the distance requirements applicable to loading and unloading tank vehicles. The letter indicates that the changes at the Jonesboro location would put the transfer point within 15 feet of the highway right of way and that the NFPA guidelines, which Federated follows when determining insurability, requires a distance of 25 feet for Class I liquids. However, the letter does not state whether insurance would be denied to COT.

The second letter, dated September 5, 1996, was written to DOTD by H.R.

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Bluebook (online)
975 So. 2d 765, 2008 La. App. LEXIS 196, 2008 WL 373596, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-dotd-v-cole-oil-and-tire-co-inc-lactapp-2008.