Yates Petroleum Corp. v. Kennedy

775 P.2d 1281, 108 N.M. 564
CourtNew Mexico Supreme Court
DecidedJune 22, 1989
Docket17863
StatusPublished
Cited by12 cases

This text of 775 P.2d 1281 (Yates Petroleum Corp. v. Kennedy) is published on Counsel Stack Legal Research, covering New Mexico Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Yates Petroleum Corp. v. Kennedy, 775 P.2d 1281, 108 N.M. 564 (N.M. 1989).

Opinion

OPINION

RANSOM, Justice.

Yates Petroleum Corporation (Yates) appeals from the judgment of damages awarded W.G. and Betty L. Kennedy (Kennedy) following a bench trial in a condemnation proceeding. This case is receiving appellate review for the third time. See Kennedy v. Yates Petroleum Corp., 104 N.M. 596, 725 P.2d 572 (1986); Kennedy v. Yates Petroleum Corp., 101 N.M. 268, 681 P.2d 53 (1984). At issue here is whether the trial court erred in the method employed to calculate just compensation, and, if not, whether the judgment awarded is supported by substantial evidence.

On February 16, 1983, Yates filed a proceeding to condemn an easement for a thirty-foot right-of-way for the continuing operation and maintenance of a natural gas pipeline that traverses Kennedy’s ranch-land for a distance of 9,240 feet. The easement burdens approximately 6.38 acres. The pipeline had been in existence since 1972 and preceded Kennedy’s ownership of the ranch by three years. This action is a consequence of Yates’ failure to record an easement acquired from the prior owner.

Three commissioners were appointed to assess just compensation. Yates objected to the commissioners’ report and appraisal; but, following a hearing, the trial court confirmed the damage award. Pursuant to NMSA 1978, Section 42A-1-21 (Repl.Pamp. 1981), Yates demanded de novo review of the compensation award. It waived trial by jury. The case was tried to the same judge who had confirmed the commissioners’ report and judgment.

At trial, Yates presented its evidence first and called an expert real estate appraiser as one of its witnesses. The expert testified that the highest and best use of this property was for ranching, the fair market value of the ranch before the taking of the easement was the same as after the taking, and the fair market value of property comparable to Kennedy’s was $55 to $165 per acre.

In presenting his case-in-chief, Kennedy took the stand and recounted problems he had experienced with dust created by traffic along a tract road that ran parallel to the pipeline within the easement right-of-way. Yates’ employees would travel this road at least once a week to check the condition of the pipeline. Kennedy testified that his livestock would not graze on grass that was covered by dust raised by this traffic. While he made no claim for special damages to which he might be entitled (as not duplicative of the statutory measure of damages for the property actually taken, see SCRA 1986, 13-705), Kennedy opined that, based upon unspecified past and prospective damage to his cattle operation, the difference in the value of, his ranch before the taking compared to after the taking was $40,000. Kennedy testified:

Q. [D]o you have an opinion as to the value per acre of your deeded lands in the area where the taking occurred?
A. Well, not really. I didn’t set a value on it because I wasn’t ready to sell any of it.
Q. Let me ask you this, Mr. Kennedy. Do you have an opinion as to the difference in value of your ranch before the taking versus after the taking as of February 1983 in damages?
A. Well, considering all the traffic and the dust, and that kind of stuff that I’ve put up with on that pipeline * * * I would say more in the neighborhood of $40,000.
Q. Insofar as in diminution in value occasioned by the taking?
A. Yes. I’ve lost considerable income from the dust that has been put on the grass, and the cattle will not graze it until it’s washed off; they just go to the other areas. And it’s been a pretty damaging factor.
A. [I]t’s hard to pick a figure and say, “Well, this is a fair figure for the damage that we’re going to do so many years down the road, or what we’ve already did in the past.” * * * *
THE COURT: What factors did you use in coming up with the $40,000?
THE WITNESS: Well,—
THE COURT: What did you take into account?
THE WITNESS: The years of use that they have used this pipeline and run up and down it consistently, and the fact that no other pipeline that I’ve got or anybody else has got in the area, that I know of, has got pits on it that are a possibility for livestock getting in it — and I’ve had Yates dig other pits that I’ve had cattle get in and get killed, and all this kind of stuff. And it’s kind of — I don’t know, you’ve just got to pick something out of the blue sky that you feel like is a just figure. And so that’s where I come up with it; I just—
THE WITNESS: We’ve had, you know, we’ve had considerable damage, and we’ll continue to have it as long as they use it. And if we can stop that usage, well, my guesstimate would be lower.

(Emphasis added.)

Mr. Fred Collins, one of the commissioners called as a witness by Kennedy, corroborated that traffic on the easement tract road creates dust that settles on the grass preventing the livestock from grazing. He gave his opinion that, for grazing purposes, the land injuriously affected by the dust would cover 300 feet in addition to the easement, and that the dust can be blown west a quarter of a mile (1,320 feet). On cross-examination, however, Collins conceded that he had no comprehensive knowledge of the traffic on the tract road and could only testify that “there’s some dust.”

In the court’s second amended findings of fact and conclusions of law, the trial judge made the following findings:

11. As a result of the operation, and maintenance of the pipeline, dust is cast into the air in an area approximately xk mile wide for the length of the pipeline. This dust interferes with, and consequently greatly diminishes the value of the property, for ranching purposes, because cattle won’t eat vegetation with a heavy layer of dust. There has been an injurious effect and “taking” of a strip of land owned by the Plaintiff xk mile wide.
12. The fair market value of the land “taken” for ranching purposes is $165.00 per acre.
13. As mandated by 42A-1-26 NMSA 1978, Kennedy has suffered total damages resulting from the taking by Yates equal to the difference between the fair market value of the entire property immediately before the taking and the fair market value of the property remaining immediately after the taking in the sum of $46,200.00.

Burden of proof. First, Yates complains that the trial court improperly allocated the burdens of proof to establish damages in this case. Following SCRA 1986, 13-701, the court required both Kennedy and Yates to prove their respective contentions by the greater weight of the evidence. Yates maintains that Kennedy had the burden of proving that substantial damages resulted from Yates’ taking of the easement.

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Cite This Page — Counsel Stack

Bluebook (online)
775 P.2d 1281, 108 N.M. 564, Counsel Stack Legal Research, https://law.counselstack.com/opinion/yates-petroleum-corp-v-kennedy-nm-1989.