The State of Texas v. Monte Story--Appeal from County Court at Law of Ellis County

IN THE

TENTH COURT OF APPEALS

No. 10-95-034-CV

THE STATE OF TEXAS,

Appellant

v.

MONTE STORY,

Appellee

From the County Court at Law

Ellis County, Texas

Trial Court # C-2393

O P I N I O N

The State appeals a judgment awarding the appellee, Monte Story, $109,846.25 for its condemnation of approximately 20 acres of an 86.4015-acre tract of land in Ellis County. The State raises a single point on appeal that the trial court erred in refusing to allow its appraiser to offer testimony on the market value of the remainder in determining the value of the 20 acres that was actually taken. We affirm.

The record reveals that the State sought to condemn the 20 acres at issue in an effort to widen a highway. At trial, the condemnee argued that the 20-acre strip was a self-sufficient economic unit and, therefore, the valuation of the 20 acres should not be made with reference to the value of any part of the remainder, but should be made solely upon the value of the 20 acres itself at the time of the taking. The State, on the other hand, argued that the highest and best use of the 20 acres would have been to keep the 20 acres together with the 66.4-acre remainder and develop the entire 86.4-acre tract for single-family residential use, contending that that the 20-acre strip was not a self-sufficient unit. The State asserted that, once the value of the 86.4-acre tract was ascertained, the value of 20-acre strip could be determined as a pro rata share of the entire tract.

Before trial, the condemnee raised a motion in limine wherein he argued that the State should not be allowed to offer any evidence on the value of the remainder because the 20-acre strip was a self-sufficient economic unit. The condemnee therefore asserted that the valuation of the 20 acres should be undertaken by looking solely at the 20-acre strip and any evidence of the value of the remainder would be irrelevant. // The State responded, essentially, that the 20-acre strip was not a self-sufficient economic unit because its highest and best use could have been achieved only if it had been developed along with the 66.4-acre remainder. The trial court agreed with the condemnee and granted the motion in limine. The State then made an offer of proof of the testimony which it wished its appraiser, Dennis Gruelle, to give.

The State relies primarily upon the Supreme Court's reasoning in State v. Windham, 837 S.W.2d 73 (Tex. 1992), for its argument. In Windham, the State sought to condemn 2.12 acres out of a 19-acre tract for the purpose of widening a highway in Brazos County. Id. at 74. Both the State and the condemnee agreed that the highest and best use of the 2.12 acres was for commercial development purposes. Id. The parties also agreed that the 2.12-acre strip was not a self-sufficient economic unit. See id. With the 2.12-acre strip not being a self-sufficient economic unit, the parties were unable to determine the value of the strip without combining it with enough of the remainder to the point where the combined tract would constitute a self-sufficient economic unit. Id. The question then arose of how much of the remainder tract should be included with the 2.12 acres to determine the value of the 2.12 acres. Id. at 76. The condemnee asserted that the 2.12-acre strip, if broadened to a 3.84-acre strip of land, would constitute a self-sufficient economic unit. Id. at 74. The condemnee then argued that the fair market value of the 3.84-acre tract could then be determined by calculating the 2.12-acre strip as a pro rata portion of the 3.84 acres. Id.

The State, however, maintained that the highest and best use of the entire 19 acres would be to keep the entire 19 acres together and eventually use them for commercial development purposes. Id. at 75. Therefore, the State argued that the 2.12-acre strip should only be considered with the entire original 19-acre tract and that the condemnee should not be permitted to determine how much of the remainder tract the 2.12 acres should be considered therewith. Id. The trial court agreed with the condemnee and prevented the State from offering any evidence on the fair market value of the entire 19-acre tract. Id. at 74.

The Supreme Court disagreed with the trial court, and the intermediate court that affirmed its decision, and held that the State was entitled to offer evidence on the highest and best use of the entire 19-acre tract and how the value of the 2.12-acre strip would be affected thereby. Id. at 76.

Concerning the facts here, the State argues that the highest and best use of the entire 86.4-acre tract is for single-family residential use. The State also contends that the highest and best use of the 20-acre portion that was taken is for single-family residential use, but only if the 20-acre portion is considered with the remainder. The State's argument, however, must fail.

The Supreme Court has expressly held that when a portion of a larger tract is condemned, and the portion taken is a self-sufficient economic unit, then the valuation of the portion taken is not to involve any consideration of the value of the remainder. Id.; see City of Tyler v. Brogan, 437 S.W.2d 609, 613 (Tex. Civ. App. Tyler 1969, no writ). Whether or not the part taken could have a higher and better use if it was left combined with the remainder does not determine whether or not the part taken is a self-sufficient economic unit. The State's own appraiser, Mr. Gruelle, believed that the 20-acre portion that was taken could be developed as a self-sufficient economic unit. True, he also believed that the 20 acres would have had a higher and better use if developed along with the remainder, but the fact remains that he first and foremost believed that the part taken constituted a self-sufficient economic unit. Because both parties agreed that the 20-acre portion constituted a self-sufficient economic unit, any evidence on the value of the remainder was irrelevant. See Southwestern Bell Tel. Co. v. Ramsey, 542 S.W.2d 466, 471 (Tex. Civ. App. Tyler 1976, writ ref'd n.r.e.). The State's point of error is overruled, and the judgment is affirmed.

BOBBY L. CUMMINGS

Justice

Before Justice Cummings and

Justice Vance

Affirmed

Opinion delivered and filed July 17, 1996

Do not publish