In re Chittenden Solid Waste District
Annotate this Case
In re Chittenden Solid Waste District (2005-217)
2007 VT 28
[Filed 20-Apr-2007]
NOTICE: This opinion is subject to motions for reargument under
V.R.A.P. 40 as well as formal revision before publication in the Vermont
Reports. Readers are requested to notify the Reporter of Decisions,
Vermont Supreme Court, 109 State Street, Montpelier, Vermont 05609-0801 of
any errors in order that corrections may be made before this opinion goes
to press.
2007 VT 28
No. 2005-217
In re Chittenden Solid Waste District Supreme Court
On Appeal from
Chittenden Superior Court
March Term, 2006
Matthew I. Katz, J.
Michael L. Burak and W. Scott Fewell of Burak Anderson & Melloni, PLC, and
Joseph E. Frank of Paul Frank & Collins, P.C., Burlington, for
Plaintiff-Appellee.
Robert F. O'Neill, Norman Williams and Megan J. Shafritz of Gravel and
Shea, Burlington, for Defendant-Appellant.
PRESENT: Reiber, C.J., Dooley, Johnson, Skoglund and Burgess, JJ.
¶ 1. DOOLEY, J. Hinesburg Sand & Gravel Company, Inc. (HS&G)
appeals from an amended judgment of $4 million in damages for the
condemnation of its sand pit by Chittenden Solid Waste District (the
District) to create a solid waste landfill. Following a jury verdict, the
Chittenden Superior Court granted the District's motion for judgment as a
matter of law pursuant to V.R.C.P. 50(b). The court ruled that HS&G
suffered no compensable business loss, and it set aside that part of the
verdict that awarded HS&G an additional $4.8 million for business loss.
HS&G argues that the court erred in granting the motion and that the court
should have awarded it interest to make the valuation current. We hold
that the superior court properly determined that HS&G was not entitled to
compensation for business loss or to prejudgment interest. We affirm.
¶ 2. Condemnation proceedings began in 1992 when the District
filed a petition pursuant to 24 V.S.A. 2299a to condemn a sand pit
located in Williston, Vermont that is owned and operated by HS&G. As its
name suggests, HS&G's manufacturing and processing plant, as well as its
main gravel pit, are located in Hinesburg, some miles from the sand pit.
¶ 3. The District intends to create a regional solid waste landfill
at the sand pit site. The landfill condemnation statute, 24 V.S.A.
2299a-2299k, sets forth two separate steps for the District to condemn
property for a landfill. First, the District must show, and the superior
court must find, that the condemnation is necessary. Id. 2299e. Second,
unless the District and any person "with an interest in the property" can
agree on damages, the court must assess the damages caused by the taking.
Id. 2299f.
¶ 4. In this case, HS&G contested both the necessity for the taking
and, after necessity was determined, the compensation offered by the
District. In the necessity phase, the superior court found that the
District had satisfied the criteria for necessity set forth in 24 V.S.A.
2299b(1), subject to the condition that the District stockpile and make
sand from the pit available to HS&G for up to thirty years. The condition
was included pursuant to a plan presented by the District to excavate and
stockpile sand, at its expense, for HS&G to transport to its Hinesburg
plant to process. To the extent the District excavated and stockpiled sand
for HS&G, the plan required it to (1) excavate the sand "in a reasonable
way" consistent with "preserving or enhancing the value of the available
sand to HS&G," (2) cover it with a "vegetative cover," and (3) handle it so
as to "prevent any significant contamination by litter or landfill
leachate." HS&G appealed the finding of necessity and the court's
authority to order the stockpiling condition to this Court, and we
affirmed. Chittenden Solid Waste District v. Hinesburg Sand & Gravel Co.,
169 Vt. 153, 154, 730 A.2d 614, 616 (1999).
¶ 5. In affirming, we explained that the superior court had simply
adopted the proposal of the District, and had not modified or altered the
proposal. Thus, we stressed that the condition did not bind HS&G:
The condition objected to by HS&G was imposed on [the District]
not HS&G. HS&G could take it or leave it. The condition commits
[the District] to adhere to a plan, at [its] cost and expense, to
make the Redmond sand available to HS&G . . . if it chose to take
it. We conclude that in so determining the court did not bind
HS&G to any conditions subsequent to the condemnation, but instead
was merely adhering to the legislative mandate under § 2299b(1)
that the court consider and give effect to the policy of
protecting earth resources as required by 10 V.S.A. § 6086.
. . . .
The court did take into account "inconvenience and expense" by
offering HS&G the choice whether to accept the sand. Depending on
HS&G's choice, the issue of expense may be relevant in the damages
portion of the proceedings yet to come.
Id. at 160, 730 A.2d at 619-20.
¶ 6. This appeal arises from the damages phase of the condemnation.
Before trial, the parties skirmished over what issues could be litigated in
the damages phase. The District, through a motion for partial summary
judgment, argued that HS&G was precluded by collateral estoppel from
relitigating issues related to the viability of the District's plan to
excavate and provide sand to HS&G. The superior court agreed, deciding
that HS&G could not relitigate the claim that sand would not be available,
because that issue had been decided in the necessity phase when the court
found that the District's plan would provide sand to HS&G in a useful and
valuable form. The court did, however, deny the District's motions in
limine to prevent HS&G's experts from testifying to the costs involved in
using the excavated sand as it related to business losses. A similar
ruling was made just before trial commenced.
¶ 7. During the jury trial on damages, HS&G introduced evidence to
prove that in addition to compensation for the value of the sand pit
property, it was entitled to recover for business losses consisting of the
additional costs of sorting the commingled coarse and fine sand and
cleaning the sand because of contamination by bird droppings on the
stockpile. HS&G's expert testified that this additional processing would
cost the company over $5.7 million. As to the value of the property
itself, appraisal experts for both parties agreed that the highest and best
use of the property was as a landfill, and not as a sand pit. They agreed
that the property's fair market value, when valued as a landfill, was about
$1.8 million. (FN1) In addition, HS&G president Paul Casey testified that
he thought the property was worth $7.5 million, without including the value
of the sand.
¶ 8. The court instructed the jury that it could award HS&G
compensation for both the fair market value of the property and the
business loss. For the property value determination, the court instructed
the jury to determine fair market value "based on the highest and best use
of the property," defined as the one "which is the most profitable." The
court went on to instruct that fair market value "includes the value of the
sand." The court also instructed that in determining fair market value, it
must consider the effect on that value of any restrictions on the
District's use: the right of HS&G to excavate and remove sand through
October 31, 2007, the obligation of the District to make sand available to
HS&G under its sand plan, and the right of HS&G to take the stockpiled sand
without charge. The court instructed that the jury should set fair market
value as of January 1, 2000. Since the valuation date was already nearly
four years old, the court further instructed: "Do not add interest, that
will be handled by the Court after the verdict is received."
¶ 9. The court also instructed on business loss as follows:
Damages to the sand and gravel operation at the Hinesburg plant
are measured by any increase in the costs of operating the plant
caused by the District's taking of the Redmond Road sand pit.
Hinesburg Sand and Gravel asserts that the District's co-mingling
of coarse and fine sands and the defecation of sea gulls on the
sand piles will increase processing costs back at its plant. . . .
[A]ny damages for increased costs at the Hinesburg plant must be
reduced to present value as of January . . . of 2004. . . . I
must inform you that Hinesburg Sand and Gravel will have
sufficient quantity and quality of Redmond sand to continue its
plant operations for the foreseeable future. . . . And although
there will be sufficient quantity and quality, that does not
answer the question of whether there may be increased processing
costs which is what a good deal of this trial was about.
¶ 10. The jury returned a verdict of $4 million for the property
and $4.8 million for the value of business loss. After the jury rendered
its verdict, the District moved for judgment as a matter of law pursuant to
V.R C.P. 50(a), arguing that HS&G failed to carry its burden of proof on
business loss damages. In this motion, and in its renewed motion in March
2004, the District argued that HS&G was collaterally estopped from arguing
that it would have to bear increased processing costs because the court had
found in the necessity phase that the "inconvenience and expense to HS&G
[because of the sand plan] would be negligible." The District also argued
that the evidence supporting business loss was speculative, that business
loss was unrecoverable for business on another property-that is, the site
of the Hinesburg plant-and that HS&G could not recover for business loss
based on its use of the property as a sand pit when the amount of damages
was based on the use of the property as a landfill. The court granted the
District's motion for judgment as a matter of law on March 23, 2005,
striking the award for business loss. The court agreed that HS&G was
collaterally estopped from arguing about the quality and quantity of sand,
that the business loss incurred was not to "business on the property" as
required by statute, and that valuing the property as a landfill and then
obtaining compensation for business loss associated with its use as a sand
pit would constitute double recovery. On May 6, 2005, the court entered an
amended judgment of $4 million for the fair market value of the property.
HS&G here appeals this amended judgment, challenging the deletion of the
business loss damages.
¶ 11. After the trial ended, the court considered whether to order
prejudgment interest on the jury's award. HS&G asserted that it was
entitled to such prejudgment interest, and it left blanks for the court to
enter interest in its proposed judgment order. Despite the court's earlier
suggestion in the jury instructions that interest would be added to the
January 1, 2000 valuation, the court declined to order prejudgment interest
on the property value award. The court reasoned that because the land had
not yet been taken, HS&G had not been deprived of the property, so no
interest was due. Notably, the court did not address its earlier
statements about interest in the jury instructions, focusing instead on the
fact that even though the parties knew the taking would not occur until at
least 2007, no one objected to the chosen valuation date. HS&G appeals
this denial of prejudgment interest.
¶ 12. The District moved for a new trial or remittitur of part of
the damages awarded for the property taken pursuant to V.R.C.P. 59(a),
arguing that the jury's award of $4 million for the property was excessive
and against the weight of the evidence. The District urged the court to
remit the award to $1.8 million, the value that both parties' experts had
agreed was the fair market value of the property as of January 1, 2000. In
the court's March 23, 2005 entry granting the District's motion for
judgment as a matter of law on the business loss damages, the court chose
to defer ruling on the motion for a new trial or remittitur. The court
commented that it would wait to rule on the motion until advised by the
District as to whether it wished to proceed with the motion or waive the
motion and permit final judgment and appeal. A month later, the District
informed the court that it would not object to a denial of its pending
motion for a new trial or remittitur to prevent any further delay in
entering a final judgment. On May 6, 2005, the court entered the amended
judgment and later issued an entry order indicating that the motion for new
trial or remittitur had been withdrawn. In response to HS&G's appeal, the
District filed a cross appeal, stating that if this Court did not affirm
the superior court's grant of judgment as a matter of law, the case should
be remanded for a decision on the merits of its motion for a new trial or
remittitur. The District also argues that such a remand should address
whether the evidence supporting business loss was speculative, and asserts
that, if the case is remanded on the issue of business loss damages, this
Court should order a new trial on all damages issues, including the $4
million valuation of the land.
¶ 13. The first issue is whether the superior court erred in denying
HS&G business loss damages for processing costs associated with cleaning
and sorting the stockpiled sand. We review a judgment as a matter of law
de novo, using the same standard as the trial court. Schaad v. Bell
Atlantic Nynex Mobil, Inc., 173 Vt. 629, 631, 800 A.2d 455, 458 (2002)
(mem.). "Judgment as a matter of law is appropriate" where there is "no
'legally sufficient evidentiary basis for a reasonable jury to find for
[the nonmoving] party.' " Id. (quoting V.R.C.P. 50(a)(1)).
¶ 14. Vermont has a special statute for condemnation by solid waste
management districts. 24 V.S.A. §§ 2299a -2299k. On the issue of damages
available to the property owner, the statute is identical to that for
condemnation generally. Compare id. § 2299b(2) with 19 V.S.A. § 501(2).
Thus, our preexisting case law on damages available in condemnation
proceedings is applicable here. Vermont law specifically authorizes
damages for the value of "the business on the property, and the direct and
proximate decrease in the value of the remaining property or right in the
property and the business on the property." 24 V.S.A. 2299b(2); 19
V.S.A. § 501(2).
¶ 15. In looking at business loss in this case, we start with an
observation from Pinewood Manor, Inc. v. Vermont Agency of Transportation,
164 Vt. 312, 317, 668 A.2d 653, 657 (1995):
Though many states view injury to or destruction of a business
upon lands taken by eminent domain as too uncertain, remote or
speculative to be compensable . . . Vermont specifically
identifies business loss as a reimbursable item of damage in a
condemnation proceeding. 19 V.S.A. § 501(2). Business loss is
not unlimited, however, and this Court has adopted standards to
minimize uncertainty and speculation.
The property owner has the burden to show business loss. Id. at 319, 668 A.2d at 658. Especially in cases where the property owner's business
involves selling all or part of the land or using the land intensely, we
must be particularly careful not to allow double recovery between the
amount for the value of the property taken and the value of the business
that is on the property taken. Thus, we can allow compensation for
business loss only to the extent that such loss has not been compensated in
the value of the land taken. See Penna v. State Highway Bd., 122 Vt. 290,
293, 170 A.2d 630, 633 (1961). We observed in Penna that, with respect to
farm land compensation, the loss of the business of the farm and the value
of the land is almost always double compensation. See id.
¶ 16. The general rule that damages for business loss are allowed
only to the extent that the landowner has suffered a loss to the business
which has not been compensated for in the allowance made for the land is
explained in Sharp v. Transportation. Board. of the State of Vermont, 141
Vt. 480, 451 A.2d 1074 (1982). In Sharp, the State took most of the
property owner's land for construction of a highway and, as a result of the
condemnation, prevented the continuation of the farm on the property. The
jury made an award for the land at its highest and best use, which was
agreed to be for residential development. Pursuant to instructions, the
jury also awarded the land owner damages for the full value of his lost
farm operation. This Court reversed holding that recovery of the land
value based on one use and business loss based on another would create
double recovery. Id. at 488, 451 A.2d at 1077; see also Mazza v. Agency of
Transp., 168 Vt. 112, 117, 716 A.2d 817, 821 (1998). Although there are
significant differences in the circumstances here compared to those in
Sharp, there is similar double recovery here because the sand pit land was
valued at its highest and best use as a landfill, but the business loss
award assumed it continued as a sand pit. This is not, however, the most
significant point about the application of Sharp.
¶ 17. We explained in Sharp how to value business loss. In the
simple case where the business is taken entirely, the amount of the
business loss is determined by subtracting the value of the land, at its
highest and best use, from the value of the business before the taking.
Id. at 487, 451 A.2d at 1077. In the case where, as here, the business is
not taken entirely, the business loss is equal to the loss in the value of
the business as a result of the taking minus the added value to the land
caused by valuing it at its highest and best use. We emphasized in Sharp
that the business loss is measured in the first instance by the reduction
in the value of the business. See id. at 489, 451 A.2d at 1078 (if the
taking "did not totally destroy [the] business," the damages are the actual
"diminution in the value of the business remaining"). On reargument in
Sharp, we explained some of the factors going into business value:
The value of the business as a whole includes (a) the contribution
made by the land to the business, (b) the personal property used
by the business, (c) the going concern value of the business, (d)
the increased value derived from the fact that tangible assets are
combined in a single unit and are already functioning in the
marketplace, and (e) where appropriate, goodwill.
Id. at 491, 451 A.2d at 1079.
¶ 18. The holding of Sharp was further explained in Pinewood Manor.
There, the property owner was a residential housing developer and the
condemned land was subdivided for housing construction based on a
subdivision permit. As business loss, the property owner sought the
profits it would have made from the houses it planned to construct on the
land. We rejected the inclusion of lost profits as a factor in the
business loss calculation for two reasons. The first was that "lost
profits depend on speculation and conjecture." Pinewood Manor, 164 Vt. at
318, 668 A.2d at 657. The second was a concern for "duplicate
compensation." Id., 668 A.2d at 658. We stated:
Prior profitability already influences the business loss
calculation because it affects the value of the business as a
going concern and the value of its goodwill. Because Pinewood has
already received the fair market value of the lots, the only extra
compensation to which it might be entitled would come from these
more negligible factors that are included in the value of the
business as a whole.
Id.
¶ 19. Finally, we further explained the Sharp holding on valuing the
business loss in Mazza, where the plaintiff argued that its business loss
consisted of the cost of a new irrigation line on his remaining farm land.
168 Vt. at 118, 716 A.2d at 821-22. Relying on the holding of Allen v.
Burlington Housing Authority, 129 Vt. 8, 13, 270 A.2d 588, 592 (1970) that
the cost of improvements is not necessarily reflected in value, we held
that the cost of the irrigation line was not necessarily reflected in the
value of the business. Id.
¶ 20. HS&G's proof in this case suffers from the same deficiency as
the plaintiffs' did in Mazza and Pinewood Manor. HS&G's President
testified to the value of the business before the taking and described in
detail the effect of the loss of the Redmond Road sand and the additional
costs that the District's plan to excavate and stockpile sand would impose
on it. Through its officers and expert witness, it presented the expected
cost of removing seagull feces from the sand and of segregating the sizes
of sand that would become commingled in the transport from the pit to the
stockpile. Its theory was that it should be able to recover its additional
costs over the remaining life of the sand. Consistent with that theory,
the superior court charged the jury that the proper measure of damages was
the cost to clean and segregate the sand, and the jury necessarily based
its business loss award on those costs.
¶ 21. Just as we refused to measure lost value of the business by
lost profit, or the cost of infrastructure made necessary by the land
taking, we cannot measure lost value by the additional expense involved in
using Redmond Road sand. The District was bound to excavate and stockpile
the sand, but HS&G was not obligated to take it if the cost of processing
made it uneconomical. We recognize that there was extensive testimony
about the unique role of Redmond Road sand in HS&G's business operations.
But there was little evidence of how HS&G would operate without such sand
and none on the value of HS&G without Redmond Road sand.
¶ 22. More important, there was extensive evidence on how, and to
what extent, the District's plan for excavating and stockpiling sand would
increase HS&G's processing costs if it chose to use the stockpiled sand,
but there was no evidence of how the annual increase in processing costs
affected the value of HS&G. Just as we rejected the argument that it would
have been impossible in Mazza to estimate the impact of the need to
relocate the irrigation line on business value, 168 Vt. at 118-19, 716 A.2d
at 822, we reject the argument that HS&G could not have shown the impact
of the processing costs on the value of the business. Without that
showing, the jury could not properly determine business loss, the issue on
which HS&G had the burden of proof. Indeed, given the double recovery
inherent in the jury's verdict, we cannot determine whether there was any
net business loss. We conclude that the superior court was correct in
granting the District's motion for judgment as a matter of law on business
loss damages.
¶ 23. We recognize that we have decided this issue in part on
different grounds than those relied on by the trial court, although the
trial court did hold that HS&G's business loss damages included double
recovery and the parties briefed in this Court the measure of damages for
business loss. In view of our disposition, we do not reach the decision of
the superior court that business loss damages were precluded, in part, by
the collateral estoppel effect of the necessity determinations or that
HS&G's business losses were not "on the property" as required by 24 V.S.A.
§ 2299b(2).
¶ 24. The second issue is whether HS&G is entitled to prejudgment
interest on its jury award. This issue requires an explanation of some
background. On November 30, 1999, in order to supplement the judgment
order of January 1997 determining that necessity requires the taking of the
land, the court issued a "net taking order." Among other items, this set
the date of valuation of the real property being taken at January 1, 2000
with the specification that "all calculations of damages should assume that
the real property will be taken" on this date. See 24 V.S.A. 2299f(c)
("The superior court shall determine damages as of the date the property is
acquired or at such other date as the court determines."). The order
further stated that "[a]ll issues of prejudgment interest will be
determined after trial." In a later order on prejudgment interest in 2004,
the trial court described the process that led to the choice of the
valuation date.
[After the determination of necessity], counsel met with the
undersigned to discuss issues involving the valuation or damages
portion of the case. One such issue was the date for valuing the
property. In order to assess fair market value, appraisers must
know a date for valuation. . . . . Here, the date of January 1,
2000 was chosen, admittedly arbitrarily. . . . But although the
date itself was not significant, two other facts probably are.
First, the parties knew that the District would not actually be
entering upon the land at that time, or indeed until late in 2007,
due to other outstanding court orders, and indeed Hinesburg would
continue to operate the [s]ite itself through 2007. Second, there
was no objection to the selection of the valuation date, as there
never has been since. As a result, the valuation phase of this
condemnation proceeding was tried with that date as its focal
point.
Consistent with the court's statement of the history, the court charged the
jury at the compensation trial that they were to value the real property as
of January 1, 2000 and they were not to award interest. HS&G did not
object to the jury charge.
¶ 25. Following the verdict, HS&G submitted a proposed judgment
order that included interest on the jury's verdict for the taking at the
statutory rate from January 1, 2000 to the date of the judgment order. The
District objected, arguing that prejudgment interest was unavailable before
the actual date of taking, which under the agreement of the parties was no
earlier than October 1, 2007. The trial court agreed and denied
prejudgment interest.
¶ 26. HS&G relies primarily on two cases, Pinewood Manor and Kirby
Forest Industries, Inc. v. United States, 467 U.S. 1 (1984), for the
proposition that interest is available before the land is taken. The cases
actually support the District's position and the superior court decision.
Kirby Forest holds that prejudgment interest does not begin to accrue
until there is an actual taking, which occurs when the government tenders
payment and acquires title to the land. 467 U.S. at 16; see also Danforth
v. United States, 308 U.S. 271, 284 (1939) ("[W]e are of the view that the
taking in a condemnation suit . . . takes place upon the payment of the
money award by the condemnor."). We held in Pinewood Manor that
prejudgment interest was available but only because the actual taking had
occurred well before the judgment was entered on compensation and the
interest ran from the date of the taking. 164 Vt. at 314, 320-21, 668 A.2d
at 655, 659.
¶ 27. The District has not tendered payment nor acquired title to
HS&G's sand pit. (FN2) HS&G continues to retain possession and use of the
sand pit and its interest in the property has not been impaired in any way.
The superior court correctly denied HS&G prejudgment interest.
¶ 28. HS&G argues, however, that even if it is not entitled to
interest as a matter of law, the District is bound by a concession that
HS&G should receive interest on the verdict amount for the taking of the
property. In urging the net taking order, the District made the following
statement:
Prejudgment interest on the real property component of the
compensation award will begin to run as of that date [January 1,
2000]. However, to avoid a windfall to HS&G-which may arise if
the legal interest rate exceeds the inflation rate for real
estate-this Court should set an appropriate rate for that interest
based on the economic conditions prevailing in the period from
January 1, 2000 to the conclusion of the compensation trial.
In its brief, HS&G asserts that the doctrine of judicial estoppel prevents
the District from changing its position and that the law of the case
prevented the superior court from denying interest. In its reply brief, it
calls the District's statement a "stipulation" that is binding and on which
HS&G relied in agreeing to the January 1, 2000 valuation date. We can
find, however, no indication that these arguments were made to the superior
court, and the court had no opportunity to address them. Moreover, the
court did not treat the District's statement as a binding concession or
stipulation, stating that "[a]ll issues of prejudgment interest will be
determined after trial."
¶ 29. Even if we address these arguments, we cannot conclude that
they give HS&G a right to interest. We have not affirmatively adopted
judicial estoppel. See Gallipo v. City of Rutland, 173 Vt. 223, 237, 789 A.2d 942, 953 (2001). In any event, the doctrine is based on the
inconsistency between the current position of a party and a prior position
of that party, but requires that the prior position be "adopted by the
court in some manner." Maharaj v. Bankamerica Corp., 128 F.3d 94, 98 (2d
Cir. 1997). The court in this case never acted on the District's earlier
position. Similarly, there can be no "law of the case" in the absence of a
judicial decision establishing that law, reserving the question in the net
taking order and again in the jury instructions. See Rezzonico v. H&R
Block, Inc., 182 F.3d 144, 148 (2d Cir. 1999) (law of the case, like res
judicata, "limits relitigation of an issue once it has been decided."
(emphasis added)). Finally, there was no stipulation or agreement between
the parties with respect to HS&G's entitlement to interest.
¶ 30. HS&G makes a new argument here, however, that even if it is
not entitled to interest, it is entitled to some method of updating the
valuation of the land, which was over three years old by the time that the
judgment was issued, and is over seven years old today. As discussed
below, HS&G argues that the failure to update the valuation is
unconstitutional.
¶ 31. We stress at the outset that we have no record to determine
whether HS&G has suffered any injury from the valuation date of January 1,
2000. HS&G did not object to the net taking order that established that
valuation date. Indeed, the superior court found in its order denying
interest that HS&G agreed to that date. HS&G offered no evidence to
suggest that the valuation would have been higher if the property were
valued as of the date of trial. The court specifically instructed the jury
that they were to value the property as of January 1, 2000, and HS&G did
not object to that instruction. Thus, we reject this argument as addressed
to us on appeal from the initial compensation judgment.
¶ 32. We recognize, however, that the absence of a record is an
incomplete answer to HS&G's argument. The landowner is entitled to just
compensation for the value of the condemned land at the time of the taking.
United States v. Reynolds, 397 U.S. 14, 16 (1970). If the valuation date
and actual date of taking are distant in time, the court-determined
valuation may no longer suffice as just compensation. Thus, in comparable
circumstances in Kirby Forest, the U.S. Supreme Court held that "when there
is a substantial delay between the date of valuation and the date the
judgment is paid, during which time the value of the land changes
materially," 467 U.S. at 18, the Fifth Amendment principle of just
compensation requires some procedure for updating the compensation award to
reflect fair market value at the time of the taking. Id. at 17. The Court
adopted the following procedure:
Rule 60(b) empowers a federal court, upon motion of a party, to
withdraw or amend a final order for "any . . . reason justifying
relief from the operation of the judgment." This provision seems
to us expansive enough to encompass a motion, by the owner of the
condemned land, to amend a condemnation award. The evidence
adduced in consideration of such a motion would be very limited.
The parties would not be permitted to question the adjudicated
value of the tract as of the date of its original valuation; they
would be limited to the presentation of evidence and arguments on
the issue of how the market value of the property altered between
that date and the date on which the judgment was paid by the
government. So focused, the consideration of such a motion would
be expeditious and relatively inexpensive for the parties
involved. Further refinement of this procedural option we leave
to the courts called upon to administer it.
Id. at 18-19.
¶ 33. The District urges us to adopt the Kirby Forest procedure and
leave HS&G to a post-judgment motion under V.R.C.P. 60(b). In support of
this approach, we note that V.R.C.P. 60 and F.R.C.P. 60 are substantially
identical. Reporter's Notes to V.R.C.P. 60. We have frequently followed
federal precedents in interpreting our civil rules. See, e.g., Tetreault
v. Tetreault, 148 Vt. 448, 451, 535 A.2d 779, 781 (1987) (using federal
decisions in interpreting V.R.C.P. 60(b)). The solid waste management
district condemnation statute specifically states that the Vermont Rules of
Civil Procedure apply to condemnation proceedings under the statute. 24
V.S.A. § 2299k. HS&G responds that the Kirby Forest procedure cannot be
used in condemnation cases in Vermont because compensation here is
determined by a jury, whereas compensation is determined by the court
without a jury in the federal system. This response confuses the procedure
for determining whether a constitutional violation has occurred with the
remedy if a constitutional violation is demonstrated. Thus, we can follow
the Kirby Forest procedure in two steps. In the first, the property owner
must demonstrate to the court that grounds exist to grant relief from
judgment under Rule 60(b)(6): that is, that there has been a material
change in the value of the property between the date of the valuation and
the date of the tender of compensation. Assuming that the court finds
grounds for relief, the narrow question of the increase in value can be
submitted to the jury. We adopt this procedure.
¶ 34. In adopting the Kirby Forest procedure, we note that the trial
court can minimize the need for post-trial motions by valuing the property
as of the date of trial, rather than an earlier date. Indeed, to prevent a
continuing cycle of post-judgment motions, any determination of increase in
value under the Kirby Forest procedure must include the period up to the
supplemental trial. We also note that the condemning authority can reduce
the need for a supplemental determination of value by tendering payment to
complete the taking as soon after the judgment as possible.
¶ 35. The District has raised three issues on cross-appeal, but
waived these issues if we affirmed the judgment below. Since we have
affirmed the superior court's judgment, we do not address the cross-appeal
issues.
Affirmed.
FOR THE COURT:
_______________________________________
Associate Justice
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Footnotes
FN1. The District's expert, George Silver, went on to state that the
conditions imposed by the necessity judgment order-that the District must
provide sand to HS&G and may not begin construction until 2007-reduced the
fair market value from $1.8 million to $775,000.
FN2. The District could have tendered payment in accordance with its board's
determination of the appropriate amount of damages and acquired equitable
title and possession while the appeal was pending in the superior court and
in this Court. 24 V.S.A. § 2299i. It did not do so in this case. In
fact, the parties stipulated that HS&G would retain possession with the
right to withdraw sand until October of 2007.
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