State Ex Rel. Dept. of Hwys. v. Hy

Montana Supreme Court

State Ex Rel. Dept. of Hwys. v. Hy

Montana Supreme Court·Decided February 18, 1976·No. 12988·Published

Opinion

No. 12988

I N THE SUPREME COURT O THE STATE OF M N A A F OTN

1975

THE STATE OF MONTANA, ACTING BY AND THROUGH THE DEPARTMENT OF HIGHWAYS OF THE STATE OF MONTANA,

P l a i n t i f f s a d Appellants,

HY -GRADE AUTO COURT, a Dissolved Montana

GLYNOEU J. WHITE, .t a t u t o r y T r u s t e e s o f Corpora t i o n ; RONALD C WHITE ; VENETA WHITE ;

as S

t h e Hygrade Auto C o u r t , a Dissolved Montana C o r p o r a t i o n ; EUTJPH E. MOORE, I N C . ,

Defendants and Respondents.

Appeal from: D i s t r i c t Court of t h e S i x t h J u d i c i a l D i s t r i c t , Honorable W. W. L e s s l e y , Judge p r e s i d i n g .

Counsel o f Record:

For Appellants :

D a n i e l J , S u l l i v a n argued and James D r i s c o l l a r g u e d , Helena, Montana

F o r Respondents:

H o l t e r , Heath and Kirwan, Bozeman, Montana Robert M. H o l t e r argued, Bozeman, Montana B e r g e r , Anderson, S i n c l a i r & Murphy, B i l l i n g s , Montana

Richard FJ. Anderson a r g u e d , B i l l i n g s , Montana Yardley and Yardley, L i v i n g s t o n , Montana Dan Yardley a p p e a r e d , L i v i n g s t o n , Montana Huppert and S w i n d l e h u r s t , L i v i n g s t o n , Montana Arnold Huppert Jr. a p p e a r e d , L i v i n g s t o n , Montana

Submitted: December 8, 1975

Decided : y?;

i'7!r,c , :-',7f

Filed : t -4 ;

Mr. Chief J u s t i c e James T . H a r r i s o n d e l i v e r e d t h e Opinion o f t h e Court.

T h i s i s a n a p p e a l from a condemnation j u r y v e r d i c t and

judgment e n t e r e d i n t h e d i s t r i c t c o u r t , P a r k County.

Hy-Grade Auto C o u r t , i s a d i s s o l v e d Montana c o r p o r a t i o n

holding f e e t i t l e t o s e r v i c e s t a t i o n property i n Gardiner, Montana. The s t o c k h o l d e r s and s u c c e s s o r s t o w r a d e a r e Veneta

White, Ronald C. White ( h e r s o n ) and Glynora White ( h i s w i f e ) , t h e y w i l l be c o l l e c t i v e l y r e f e r r e d t o h e r e i n a s "Owner". Ralph E. Moore, I n c . leases t h e s e r v i c e s t a t i o n p r o p e r t y from t h e

Owner, and h a s l e a s e d it f o r many y e a r s . This corporation w i l l be r e f e r r e d t o a s " L e s s e e " . There i s a s u b l e s s e e who a c t u a l l y

r u n s t h e s e r v i c e s t a t i o n , b u t he i s n o t a p a r t y t o t h i s a c t i o n .

The Montana Department of Highways, (State), filed this

condemnation a c t i o n i n t h e p r o c e s s o f u p g r a d i n g U. S. Highway 89 and t h e b r i d g e c r o s s i n g t h e Yellowstone R i v e r i n G a r d i n e r .

The s u b j e c t p r o p e r t y i s known a s t h e N o r t h g a t e Texaco s t a t i o n and i s t h e prime s e r v i c e s t a t i o n s i t e i n G a r d i n e r . The p r o p e r t y i s l o c a t e d on t h e "swing c o r n e r " , meaning it h a s good v i s a b i l i t y i n a l l d i r e c t i o n s and good access. The highway f o r k s a t t h e s t a t i o n , o n e f o r k g o i n g t o J a r d i n e , Montana, and t h e o t h e r c r o s s i n g t h e Yellowstone b r i d g e , and l e a d i n g t o t h e North E n t r a n c e of Yellowstone N a t i o n a l P a r k . V i r t u a l l y a l l v i s i t o r s t o t h e Park, e n t e r i n g and l e a v i n g a t G a r d i n e r , p a s s t h e s i t e o f t h e s t a t i o n .

The s t a t i o n pumped o v e r t w i c e a s much g a s a s any o t h e r s t a t i o n i n Gardiner.

A f t e r t h e t a k i n g , t h e l a n d l e f t a v a i l a b l e t o t h e Owner would n o t be s u f f i c i e n t n o r s u i t a b l e f o r a s e r v i c e s t a t i o n s i t e . A l l improvements on t h e p r o p e r t y were t a k e n by t h e S t a t e , e i t h e r

a s right-of-way, o r f o r t h e c o n s t r u c t i o n easement.

L e s s e e had l e a s e d t h e p r o p e r t y from t h e Owner s i n c e 1964, i n f a c t , s i n c e it was b u i l t i n 1948 (under t h e p r e s e n t owner and and i t s p r e d e c e s s o r i n i n t e r e s t ) . The lease i n e f f e c t a t t h e t i m e of t h i s a c t i o n was d a t e d F e b r u a r y 1, 1968,and p r o v i d e d f o r a t e n y e a r p r i m a r y t e r m w i t h two a d d i t i o n a l f i v e y e a r re- newal t e r m s . A t t h e t i m e o f t r i a l , t h e l e a s e had 1 4 y e a r s t o run.

L e s s e e a l s o o p e r a t e s a s a d i s t r i b u t o r f o r Texaco. It s e r v i c e s N o r t h g a t e Texaco and e i g h t o t h e r Texaco s e r v i c e s t a t i o n s i n t h e Livingston-Gardiner area.

P r i o r t o t h e jury t r i a l , t h e S t a t e requested a bifurcated t r i a l , t h a t i s , i n t h e S t a t e ' s view, t h e j u r y would f i r s t d e c i d e t h e t o t a l v a l u e of t h e p r o p e r t y t a k e n ( a s though owned by o n e p e r - s o n ) , subsequently receiving evidence as t o t h e value of each i n t e r e s t i n t h e whole; d e c i d i n g t h i s q u e s t i o n i n a s e p a r a t e d e l - iberation. The d i s t r i c t c o u r t conducted a s i n g l e t r i a l , p e r m i t t e d t h e i n t r o d u c t i o n o f e v i d e n c e on t h e t o t a l v a l u e of t h e p r o p e r t y , and t h e v a l u e s of t h e two i n t e r e s t s . The j u r y was i n s t r u c t e d t o a r r i v e a t a t o t a l v a l u e f i r s t , and t h e n a p p o r t i o n t h a t award be- tween Owner and L e s s e e , a l l d u r i n g o n e d e l i b e r a t i o n .

A t t r i a l defendants' expert witnesses t e s t i f i e d t o t h e t o t a l v a l u e o f t h e p r o p e r t y , r a n g i n g i n t h e i r e s t i m a t e s from a h i g h o f $135,000 ( a n estimate by t h e L e s s e e ) t o a low of $100,000 ( a n e s t i m a t e by a Texaco l a n d a p p r a i s e r ) . The two a p p r a i s e r s t e s t i f y i n g f o r t h e S t a t e g a v e e s t i m a t e d v a l u e s of $41,200 and

The j u r y r e t u r n e d t h i s v e r d i c t :

"We t h e J u r y , d u l y i m p a n e l l e d , r e a c h o u r v e r d i c t i n t h e a b o v e - e n t i t l e d Cause, a s f o l l o w s :

"1. For t h e v a l u e o f t h e l a n d and b u i l d i n g s a c t u a l l y t a k e n , t h e sum o f $100,000

"2. For t h e damage t o t h e l a n d r e m a i n i n g a f t e r c o n s t r u c t i o n , t h e sum o f $

" 3 . T o t a l owing t o b o t h D e f e n d a n t s ( t o t a l of t h e above Two ( 2 ) f i g u r e s , t h e sum of $100,000

"Out of t h e t o t a l compensation awarded t o b o t h D e f e n d a n t s , a s above s t a t e d , w e f u r t h e r b r e a k t h e award down between t h e D e f e n d a n t s , a s f o l l o w s :

"1. To Defendant, Ralph E . Moore, I n c . , a s Lessee, t h e sum of $ 50,000

"2. To Defendant, Hy-Grade Auto C o u r t t h e sum o f $ 50,000"

Judgment w a s e n t e r e d on t h e v e r d i c t October 4 , 1974.

The judgment a l l o w e d i n t e r e s t , t o Owner and L e s s e e , from t h e d a t e o f t h e p r e l i m i n a r y o r d e r of condemnation, J u n e 1 9 , 1973.

The S t a t e a p p e a l s from t h e j u r y v e r d i c t and judgment.

Three i s s u e s a r e p r e s e n t e d by t h e S t a t e f o r r e v i e w :

1. I n a n eminent domain a c t i o n , what i s t h e p r o p e r pro-

c e d u r e t o be f o l l o w e d a t t r i a l t o conform t o t h e s t a t u t o r y re- q u i r e m e n t s of s e c t i o n 9 3 - 9 9 1 2 ( 5 ) , R.C.M. 1947?

2. Whether b o t h t h e l e s s o r and t h e lessee of t h e p r o p e r t y b e i n g condemned a r e e n t i t l e d t o i n t r o d u c e t h e i r r e s p e c t i v e income f i g u r e s a s f o u n d a t i o n f o r t h e income a p p r o a c h t o d e t e r m i n e t h e v a l u e of t h e property being taken?

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