Opinion
# 2018-045-504 Claim No. 124644
08-03-2018
RENATO AND ADELE FUSCHETTO v. THE STATE OF NEW YORK
Berkman, Henoch, Peterson, Peddy & Fenchel, P.C. By: Saul R. Fenchel, Esq. Hon. Barbara D. Underwood, Attorney General By: Charles E. Gary, Assistant Attorney General
Synopsis
Appropriation trial. Court awarded damages for permanent change in slope to portion of the property even though taking only involved a temporary easement.
Case information
| UID: | 2018-045-504 |
| Claimant(s): | RENATO AND ADELE FUSCHETTO |
| Claimant short name: | FUSCHETTO |
| Footnote (claimant name) : | |
| Defendant(s): | THE STATE OF NEW YORK |
| Footnote (defendant name) : | |
| Third-party claimant(s): | |
| Third-party defendant(s): | |
| Claim number(s): | 124644 |
| Motion number(s): | |
| Cross-motion number(s): | |
| Judge: | Gina M. Lopez-Summa |
| Claimant's attorney: | Berkman, Henoch, Peterson, Peddy & Fenchel, P.C. By: Saul R. Fenchel, Esq. |
| Defendant's attorney: | Hon. Barbara D. Underwood, Attorney General By: Charles E. Gary, Assistant Attorney General |
| Third-party defendant's attorney: | |
| Signature date: | August 3, 2018 |
| City: | Hauppauge |
| Comments: | |
| Official citation: | |
| Appellate results: | |
| See also (multicaptioned case) |
Decision
This is a timely filed claim for a permanent and temporary appropriation (taking) of property owned by claimants, Renato and Adele Fuschetto, brought against defendant, the State of New York, pursuant to the Eminent Domain Procedure Law and § 30 of the Highway Law.
The Claim in this matter was filed with the Court on July 9, 2014. The appropriation maps and descriptions contained therein are adopted by the Court and incorporated herein by reference. The aforesaid maps and descriptions were filed in the Office of the County Clerk of Suffolk County. Pursuant to the requirements of Court of Claims Act § 12 (4) and EDPL § 510 (A), the Court has made the required viewing of the property which is the subject of this claim. The claim has not been assigned or submitted to any other Court or tribunal for audit or determination. Pursuant to CPLR R 3025(c), the Court deems that the pleadings are conformed to the proof presented at trial.
The subject property is a rectangular shaped parcel located at 688 Nesconset Highway in the Township of Smithtown, County of Suffolk, with all of its frontage on Nesconset Highway. Nesconset Highway is alternatively referred to as Smithtown Bypass as well as Route 347. The parcel is located on the northwesterly side of Nesconset Highway and is improved with a two-story one-family house.
During the trial of this matter the parties stipulated that the property size was 10,445 square feet before and after the appropriation and the site improvements were 3,244 square feet. There was also a stipulation that the temporary easement was terminated on July 28, 2017 and lasted 38 months and 12 days. Both experts agreed that the title vesting date was May 16, 2014 and that title to the subject property on the vesting date was in the name of claimants. The parties also stipulated that the highest and best use for the property both before and after the taking was its present use, a single family house in the R-10 zone.
The subject property is identified on the Suffolk County Tax Map as District 800, Section 134, Block 1, Lot 35.001. The subject property is approximately 10,445 square feet, gently sloped in a northerly direction and is improved with a two-story house which contains 3,244 square feet. The subject property has 102 feet of frontage on Nesconset Highway with a depth varying from 94 to 115 feet. The subject property is only accessible by a driveway located on Nesconset Highway.
Defendant exercised a temporary easement, 3,811 square feet in area, across the entire frontage of the subject property. The temporary easement was associated with a construction project to expand New York State Route 347 and its stated purpose was for a work area that would terminate upon the approval of the completed work. The temporary easement reserved to the owner the "right of access and the right of using said property."
The construction work necessitated a raise in grade on Route 347 along the subject property's frontage. The change in grade required defendant to change the grade of the subject property's driveway access, parking area and an area in front of the house. Improvements within the temporary easement area included a mailbox, wooden stockade fence and Belgian block curbing.
Despite an ongoing discovery demand the State failed to provide claimants with the updated construction plans dated May 2016 even though defendant's engineer had the benefit of those plans when preparing his engineering report. As a result the Court authorized claimants to file amended reports and defendant to file any rebuttal reports deemed necessary.
William Lahti, an engineer, prepared a report, a rebuttal report and an amended report on behalf of claimants in this matter. Mr. Lahti testified that the temporary easement extends across the entire Route 347 frontage and encompasses almost the entire front area of the property as well as the majority of the side yard. The central portion of the temporary easement encompasses the entire asphalt paved area that served as parking and provides access to the property. The boundary of the easement was 4 feet from the garage doors and less than 1 foot from the southwest corner of the house. The easterly portion of the temporary easement encompasses the concrete walkway used to access the structure.
Mr. Lahti explained that the temporary easement had both temporary and permanent effects. The temporary effects include the ability of defendant to landlock the subject property as the easement runs across the entire frontage of the property. While the temporary easement reserves a right of access, Mr. Lahti states that the construction will inevitably impact the ability to access and park on the property. Defendant made permanent modifications to the subject property through the use of the temporary easement. He opined that the permanent effects included significantly altered grading of the property to a non-complaint grade, impairment of the frontage and septic system, flooding and water damage issues and diminished vehicular access to the property.
Mr. Lahti testified that, prior to the taking, the width of access to the State highway measured in excess of 30 feet at the highway boundary. He explained that the curb cut was 15 feet wide but the paved area expanded outward and became wider as it approached the residence. Based upon the defendant's August 2015 plans, after the taking, the width of access to the property would be reduced to 15 feet. Mr. Lahti stated that the applicable Town of Smithtown zoning ordinance requires every combined entrance and exit driveway to have a minimum width of 20 feet. He opined, that the driveway, after the taking is in non-conformity with this requirement. Additionally, the decreased width causes vehicles to enter the driveway at a significantly lower speed of 10 mph. The lower speed increases the risk of vehicular accidents as there is no deceleration or turning lane on Route 347. The speed differential between the highway speed of 45 mph and the entering speed of 10 mph prior to the taking was reduced from 35 mph to 30 mph after the taking. In support, Mr. Lahti cited the Center for Transportation Research at Iowa State University's published study regarding speed differential accidents.
Mr. Lahti opined that the re-grading of the existing driveway and parking area created permanent impairments and diminished the use of the property. Prior to the temporary easement, the parking area and driveway had a grade of approximately 2.7%. As a result of the re-grading, the slope will have a centerline and cross slope of 10%. Mr. Lahti set forth that the Town of Smithtown has a maximum allowable driveway slope of 8% for a residential driveway. Thus, the temporary easement created a non-conformity with the Town code where none existed prior to the temporary easement. Mr. Lahti opined that the combination of the 10% slope and the 40 foot distance between the highway entrance and the front of the residence increases the likelihood of onsite vehicular accidents, especially in inclement weather. It also diminishes the site's functionality. According to the May 2016 plans, part of the parking area for the residence is in the location within the sloped area even though 18 feet of property remained undisturbed by the re-grading. Consequently, a car parked on this slope will have to contend with the effects of the increased grade when opening and closing their car doors. Driveway entrance speed is also impacted by the increased driveway grade. The decreased width of the driveway in combination with its increased slope, results in a safe driveway entrance speed of less than 10 mph.
Another impact of the 10% non-conforming slope is the impact on the owners ability to convert or market their home for home professional office use. Home professional office use is permissible with a special permit in the R-10 zone and common in the immediate geographic area where the property is located. The American with Disabilities Act (ADA) requires at least one handicapped parking stall with a maximum cross slope of 2%. Although the property had a slope in excess of 2% prior to the taking an ADA modification could be made to achieve the appropriate slope. No modification could be made after the slope was changed to 10%. As a result, the possibility of converting to a home professional office is eliminated.
Mr. Lahti opined that the 10% slope will cause storm water runoff to travel toward the residence at an increased velocity. Defendant's August 2015 plans demonstrate that the pavement elevation is approximately 1.5 inches higher than the garage floor elevation which exacerbates the problem of storm water entering the garage. He opined that it is highly probable that storm water will enter the garage through the bottom of the garage door. According to the United States Department of Agriculture at a 10% slope, the velocity of storm water running down a surface is 6.5 feet per second. This will result in pooling of storm water along the front of the garage and residence. In the winter months it will create a slip hazard further diminishing the utility of the front building entrance.
Mr. Lahti also opined that defendant's grading plan required the leaching pool access covers to be raised in excess of 12 inches and to be reinstalled within the steeply pitched area. The Suffolk County Department of Health Services (SCDHS) mandates a maximum 4 foot burial depth. Raising the manholes covers 12 inches will create a non-conformity with SCDHS regulations where one did not exist prior to the temporary easement. Further, any access covers on the 10% slope will create an unsafe condition because it will not be possible for the access covers to be both level and not protruding above the ground.
Additionally, Mr. Lahti opined that the southeast corner of the property will be so significantly re-graded that a retaining wall will be needed to be built along the highway boundary. According to the May 2016 plans, instead of continuing the retaining wall across a portion of the property, there is a significant section of highway frontage that will be re-graded with soil. Mr. Lahti opined that significant erosion occurs when soil is placed at such a steep angle. Smithtown Zoning ordinance § 322-3 defines environmentally sensitive land as land areas with a slope in excess of 15%. The proposed slope of 50% creates a non-conformity. Maintenance of this area which includes, mowing grass and restoration of the eroded area will fall upon the owner of the property. The hillside slope will prevent reinstallation of the fence in the same area. The fence will have to be relocated further north which will result in the loss of usable yard area.
Mr. Lahti also opined that site improvements in the temporary easement area include a utility shed, a central air conditioning system compressor unit, Belgian block curb, stockade fence, concrete sidewalk and asphalt pavement. These improvements will either need to be moved or replaced at a minimum cost of $50,000.
Christopher Tartaglia, an engineer, submitted an engineering report, two rebuttal reports and testified on behalf of defendant. In his report, Mr. Tartaglia sets forth that prior to the temporary easement, the subject property was accessible by an 18 foot wide driveway and the existing driveway had a center line gradient slope of 4.8%. He testified that the temporary easement area covered the entire driveway and parking area between the subject property and the State right-of-way line. It also covered a portion of the grassy area along the eastern side of the property.
He explained that the temporary easement would be utilized to facilitate the raise in grade of Route 347. This would require the grade of the driveway, parking area and portions of the front yard to be raised to match. As a result of the work done on Route 347, defendant will be raising the grade of the driveway so that the maximum center line gradient slope will be 10%. Mr. Tartaglia set forth that this change is not in compliance with the Town of Smithtown Zoning Code which sets forth a maximum center line gradient slope of 8% for driveways and will, require a variance. Mr. Tartaglia's report sets forth that the disturbance caused by the temporary easement and the re-grading of the property will include the placement and compaction of fill materials, re-paving of the asphalt driveway and parking area, the placement of topsoil and the re-seeding of the grass area.
In addition, the raise in grade will require, at a minimum, the raising of the access cover for the existing water meter and the associated vault to be extended. If this action imposes a significant restriction of access to water as determined by the Suffolk County Water Authority then the meter and the associated vault will have to be raised. The raise in grade will also require the raise in grade of two access covers to the existing septic tanks.
Lastly, Mr. Tartaglia testified that the re-grading of the front yard will create an increased slope of the driveway and parking area. He found no impact to the subject property or on-site parking due to the increased slope. Mr. Tartaglia opined that the non-conformity due to the increased slope would be resolved by cost to cure damages in the amount of $20,000 for engineering and legal costs associated with securing a variance. He stated that Mr. Lahti overstated the implication and impacts of the increased slope.
Mr. Tartaglia opined that the temporary easement will result in the disturbance of sections of existing wood fencing which will need to be replaced at a cost of $4,585. Additionally, he included compensation of $241 for moving the mailbox and $866 for 67.5 feet of Belgian block. Thus, Mr. Tartaglia determined that the total cost to cure damages are $25,692. He explained that this figure was a conservative estimate as he had made only one application for a grading variance in the last 10 years but does not recall the cost of that application. Although his reports do not set forth any opinion with regard to the likelihood of getting a variance, he testified that it was his opinion that the homeowner would be able to obtain a variance.
Mr. Tartaglia's rebuttal reports set forth that Mr. Lahti measured the width of the driveway at the front property line, however, the width of the driveway at the curb line measured approximately 15.5 feet. The May 2016 plans show a driveway width of 16 feet with a skew of 15 degrees which allows for a smoother turn into the driveway. Additionally, he opined that there is no negative impact on maneuverability.
Mr. Tartaglia opined that by grading the pavement along the leaching pool access covers there is no resulting tripping hazard. In addition, the leaching pool access covers would only need to be raised approximately 7.2 and 1.2 inches. He also stated that raising the leaching pool access covers does not adversely affect their functionality. He further opined that the leaching pools can still be cleaned and that the Suffolk County Water Authority would ignore or grandfather in any non-conformity.
Mr. Tartaglia stated that the May 2016 plans indicate that the utility shed, air conditioner compressor unit and an adjacent 6 foot stockade fence would not be impacted by the temporary easement. While the plans do not indicate if the existing Belgian block curbing will be replaced in kind or with new concrete curbs, new curbs are to be installed to replace the disturbed area on the sides of the driveway.
Mr. Lahti, in his rebuttal report, stated that the Tartaglia report mischaracterized the effect the temporary easement will have on the property and failed to address the permanent consequences of the temporary easement. First, he testified that even if the original slope was 4.8%, the same unsafe conditions and non-conformities exist after the temporary easement has been extinguished. Mr. Lahti also points out that there is no indication that the Town would approve such a variance.
In addition, he stated that the usability of the driveway curb cut is substantially reduced. A vehicle entering the driveway on a 10% downward slope will cause the vehicle to increase its speed and reduce its maneuverability just when a vehicle should be reducing its speed. New York State has an 8% sloped driveway guideline. The reduction of the driveway curb cut to 15 feet results in a vehicle having less room in which to enter the property. This is amplified by only having 40 feet of space between the State right-of-way and the front of the house. Lastly the storm water runoff velocity substantially increases due to the 10% slope.
Mr. Lahti filed an amended report to address the analysis made by Mr. Tartaglia in his rebuttal engineering report since Mr. Tartaglia had the benefit of having the May 2016 construction plans when he made his report.
Mr. Lahti testified that the May 2016 plans and the actual conditions that he viewed on the subject property on July 21, 2017 establish that the State contractor deviated from the May 2016 plans. The transition from the highway elevation to the residence is in a much shorter horizontal distance, ending 18 feet from the property instead of 4 feet, as originally planned. The re-graded area between Route 347 and the residence no longer has a gradual slope but now has a steeper slope estimated to be approximately 13%. Mr. Lahti assumed that the highway elevation remained as indicated on the May 2016 plans. Thus, the slope remains above the legal limits. The subject property also remains subject to increased flooding and erosion. The slope creates an unsafe condition for vehicles entering or exiting the subject property.
Mr. Lahti conceded that although the plans do not show a drain or topographic barrier to stop or redirect the storm water, a trench drain was installed on the State right-of-way to capture water run off from the State highway. However, he opined that because of the slope, flooding was still an issue and storm water will continue to run directly into the garage.
Mr. Lahti stated that the May 2016 plans illustrate that the retaining wall does not extend across the entire section of the steeply sloped property. There is still a significant portion of highway frontage that will be re-graded with soil. The soil will eventually erode away due to storm water flow. Mr. Lahti also explained that although the four foot fence was undisturbed by construction activities it has become a pseudo retaining wall. The soil that was placed in that area has already slid down the slope and is abutting the fence. Mr. Lahti measured the height of the four foot fence and concluded that it has become a 3 foot fence due to the accumulation of soil. Maintenance of this area will become highly problematic. He testified that only 2 small evergreens were planted in the area and the remainder was filled with mulch which does not stabilize soil.
Mr. Lahti set forth that the measurement of the driveway width is only one aspect of analyzing maneuverability and the safety of ingress and egress. Prior to the taking there was 30 feet of access along the highway boundary. The permanent loss of space for cars to maneuver and queue on site and the ability for only one car to enter or exit the property at a time impacts maneuverability. Cars now traveling at 45 mph on Route 347 will have to negotiate turning into a 16 foot wide driveway bounded by curbing. It invites collision if one car is attempting to leave the driveway at the same time. Additionally, a departing vehicle must now accomplish an abrupt acceleration up a slope to merge into oncoming traffic.
Mr. Lahti conceded that the May 2016 plans modified the grade near the leaching pool access covers so that their burial depth complies with the SCDHS standards of a 4 foot depth. He opined that this burial depth will be a roadblock in converting the subject property into a professional home office because SCDHS regulations for professional home office use mandate a maximum 2 foot 6 inch burial depth. Mr. Lahti pointed out that a SCDHS violation still applies to the property regardless of whether the SCDHS is aware of the condition or not.
With regard to the change in the site improvements taken as a result of the temporary easement, Mr. Lahti set forth that on the taking date of May 16, 2014 it was not possible to know what site improvements would be affected or removed and what would be constructed. On that date, it was unknown whether the property's grade would be permanently changed so as to be non-conforming to Town Code. Construction continued for over 3 years against a background of constantly changing design and construction plans. At the time of the trial, 3 months after the temporary easement was extinguished, there were still no as-built plans from which the experts could refer and testify. Mr. Lahti opined that due to this omission no reasonable projection could be made of the extent of the damage.
In rebuttal to Mr. Lahti's amended report, Mr. Tartaglia reiterated his opinion that although the 10% slope is non-conforming it does not result in a detrimental condition. He also set forth that the re-paving of the sloped driveway stopped 18 feet from the front of the garage thus, in his opinion, this section of pavement directs water away from the garage. Mr. Tartaglia visited the subject property in August 2017 and observed actual conditions that differed from the May 2016 plans. He opined that the new construction decreased the amount of storm water runoff that the property will be subjected to. Specifically, a trench drain connected to a dry well was installed at the top of the driveway to capture runoff from the roadway. He also explained that the relocation of the roadway curb 5 feet closer to the right-of-way line and installation of a new sidewalk that pitches towards the roadway decreases the amount of storm water entering the property.
Mr. Tartaglia testified that because the graded area of the driveway was shortened by 14 feet, there is a potential that the slope could have changed. How much of a change would be dependent upon whether the road elevation differed from the May 2016 plans. If the May 2016 road elevation remained the same, the slope on claimants' property would have increased from the 10% figure.
Mr. Tartaglia disputed that ADA guidelines and sanitary regulations are applicable as the subject property is a residence.
With regard to the southeasterly portion of the property, Mr. Tartaglia testified, the area now has a slope of approximately 33% which is within standard design practices. Erosion of the slope has been mitigated by the planting of evergreens whose roots serve to stabilize the soil and there would be no problems maintaining the property because evergreens do not drop leaves. Mr. Tartaglia also opined that there is no impact on the fence, as the existing fence remains undisturbed and it will not be buried in soil nor will anything pile up against it. However, Mr. Tartaglia conceded that photographs taken of the property in the week prior to trial show an accumulation of debris against the fence because of the grade going down to the fence. These photographs also indicate a fence that now stands 35 inches above the ground.
Mr. Tartaglia set forth that with respect to driveway width, the 30 foot portion of the driveway that Mr. Lahti is referring to was within the State's right-of-way. He opined that the State installed curbing along the right-of-way line to delineate the limits of the property to ensure that vehicles do not park within the right-of-way line. He did not believe that the curbing would affect a vehicle's maneuverability in the driveway. He stated that the overall width of the driveway and parking area remained the same after the temporary easement concluded. He testified that the pre-construction driveway width actually increased from 15.5 to 16 feet.
Value Before The Taking
Elinor Brunswick, a real estate appraiser, prepared an appraisal report in this matter and testified on claimants' behalf. She stated that even though the appropriation was designated a temporary easement by the State, the extent of the appropriation resulted in both permanent and temporary damages to the subject property.
In analyzing the land value of the subject property prior to the taking, as if vacant, Ms. Brunswick utilized the sales comparison or market data approach. This approach reflects an estimate of value as indicated by the actual sales market. She selected four different sales of vacant residential land within the Town of Smithtown in valuing the subject property. After making certain adjustments to the sales which she determined were appropriate she found a before taking per square foot value of the subject property of $11.01 She then multiplied $11.01 by 10,445 square feet and found a before taking land value of $115,000.
Unless otherwise noted all calculations are rounded off.
Ms. Brunswick then used the sales comparison approach to determine the market value of the property as improved before the taking. She selected 4 comparable sales within close proximity to the subject property. After making certain adjustments to the sales which she determined were appropriate she found an adjusted sales price range from $403,000 to $483,000. She then opined that the market value of the property before the taking was $460,000.
David W. Berger, a real estate appraiser, prepared an appraisal report in this matter and testified on defendant's behalf. In analyzing the land value of the subject property before taking, as if vacant, Mr. Berger also utilized the sales comparison or market data approach. He selected four different sales of vacant residential land within the Town of Smithtown in valuing the subject property. After making certain adjustments to the sales which he determined were appropriate he found a before taking per square foot value of the subject property of $13.40. He then multiplied $13.40 by 10,445 square feet and found a before taking land value of $140,000.
Mr. Berger then used the sales comparison approach to determine the market value of the property as improved before the taking. He selected four comparable sales within close proximity to the subject property. After making certain adjustments to the sales which he determined were appropriate he found an adjusted sales price range from $415,000 to $434,500. He then opined that the market value of the property as improved before the taking was $420,000.
Effect of the Temporary Easement on the Value of the Property
Both appraisers agree that the market value of the property declined as a result of the temporary easement and damages to the fee simple interest are appropriate. They also agreed that temporary severance damages as well as rent for the temporary easement are appropriate. Ms. Brunswick testified that the temporary easement created permanent damages to the subject property. She adopted Mr. Lahti's opinions and findings with regard to the impact of the temporary easement on the subject property. She also took into consideration the loss of trees that provided a buffer and privacy among other considerations.
Ms. Brunswick used the same sales in analyzing the land value of the subject property after the effects of the easement were taken into consideration. However, she made adjustments for the non-conformity of the slope and its impact on speed differential, accidents and parking. She also adjusted for the loss of mature trees that provided privacy and a buffer to the site. After applying adjustments to the properties for grading and aesthetics/view; she found an after taking land value of $8.62 per square foot for the subject property. She then multiplied $8.62 by 10,455 square feet and found an estimated after taking land value of $90,000.
Ms. Brunswick performed the same analysis using the sales comparison approach to value the property as improved after the taking. She used the same sales in her after analysis of the subject property. She however determined that additional adjustments were necessary for grading; safety of access; aesthetics/view; and marketability based upon the adoption of Mr. Lahti's opinions as well as her own observations. Her grading adjustment took into consideration the non-conformity of the slope and cross slope, the speed differential, likelihood of accidents, decreased stopping distance and storm water issues. The safety of access adjustment included loss of a skewed entrance. The aesthetic adjustment included the loss of trees. Marketability adjustments included the loss of future use as a professional home office and the unknown costs of removing or relocating site improvements included in the taking map. Ms. Brunswick opined that on the taking date there was tremendous uncertainty with respect to the impact the temporary easement would have on the subject property. The temporary easement was not a work easement that for example stored vehicles and/or equipment for a certain time period. This temporary easement permanently altered the subject property.
The easement covered 36.5 % of the subject property, including a parking area, a shed and a grassy area. At the time of the taking it was known that the State roadway was being elevated and that it would impact the subject property but the extent of the impact was unknown. Ms. Brunswick opined that the market cannot sustain such uncertainty. She explained that the purchase of a modest single family home is usually the sole investment of such purchasers. A prospective buyer confronted with this temporary easement would only consider purchasing the property at a greatly discounted price. Further, she opined that as of the taking date, the magnitude of the appropriation, although designated as a temporary easement, greatly impaired the marketability of the property. This resulted in a substantial reduction to the market value of the property. After applying all of these adjustments to the properties, she found an adjusted price range from $111,000 to $218,000. She then determined that market value of the property after the taking as improved was $160,000, which resulted in a loss of $300,000.
Ms. Brunswick determined that there was a direct loss due to the temporary easement. She multiplied 3,811 square feet by $8.62 per square foot and reached $32,851. She determined that 12% was the appropriate rate of return for the subject property and multiplied 12% by $32,851 for $3,942 per year or $328 per month.
Ms. Brunswick also determined that the temporary easement caused severance damages. She determined that the State had the right to land lock or impair access to the subject property during the entire duration of the temporary easement since it covered the entire parking area. She estimated the market rent for the subject property at $2,700 after comparing the subject to 5 comparable rentals. Ms. Brunswick determined that the loss of rent for the entire property could be warranted, however, since the owners remained in occupancy, she determined that 50% of the monthly rental or $1,350 per month was appropriate. She subtracted $328 per month from the total damages of $1350 per month. She concluded that the severance damages due to the temporary easement damages were $1,022 per month.
Mr. Berger testified that the temporary easement's impact to the subject property included the loss of trees within the subject property's boundaries. Additionally, he opined that the temporary easement resulted in negative impacts which caused temporary severance damages. Mr. Berger used the same sales in analyzing the land value of the subject property after the effects of the easement were taken into consideration. He determined that no adjustments were necessary and found an after taking land value of $13.40 per square foot for the subject property. He then multiplied $13.40 by 10,445 square feet and arrived at an after taking land value of the property of $140,000.
Mr. Berger performed the same analysis using the sales comparison approach to value the property as improved after the easement. He used the same sales in his after taking analysis of the subject property. He determined that an overall 15% adjustment was necessary to account for the loss of trees as the trees which provided privacy to the subject's house. He determined that the temporary easement did not affect the functionality of the property. He also opined that it was not necessary to make an adjustment for the change in grade to the property. After applying a 15% downward adjustment to all the comparable sales, he found the adjusted sales price range from $356,000 to $369,000. He then determined the market value of the property after the temporary easement was $360,000. Mr. Berger then deducted the amount of $25,700, the costs to cure, and determined that the market value of the property after the taking was $334,000. This resulted in a loss of $86,000.
Mr. Berger determined that there was a direct loss due to the temporary easement. He multiplied 3,811 square feet by $13.40 per square foot and calculated $51,067. He determined that 6% was the appropriate rate of return for the subject property and multiplied 6% by $51,067 for $3,064 per year or $255 per month.
Mr. Berger also determined that there were severance damages due to the temporary easement as a result of the cost to cure the negative impacts of the subject property being postponed until the temporary easement has been extinguished. To arrive at the amount of damages, he estimated the overall severance damage to the subject property at 6% of the total costs to cure. To arrive at a figure, he multiplied $25,700 by 6% for $1,542 per year or $129 per month.
On cross-examination, Mr Berger testified that although Mr. Tartaglia's report did not set forth the likelihood of obtaining an easement, he adopted Mr. Tartaglia's cost to cure in his analysis. Mr. Berger believed, based upon conversations with unknown officials at the Town, that variances will most likely be granted for non-conformities caused by condemnations. Mr. Berger factored in the cost to cure in his analysis.
During the trial Mr Berger was shown a copy of the explanation of acquisition which set forth that the taking would involve, raising of 3 septic structures, alleviation of ponding, slope non-conformity, temporary loss of parking, maneuverability issues and loss of aesthetic view. Mr. Berger testified that these factors would have an effect on a buyer and would decrease the market value of the property.
Mr. Berger also testified on cross-examination that the after value of the subject property does not reflect uncertainty. The after value reflects what is supposed to happen or what already happened with the property, however he conceded that in this case a buyer at the time of vesting would not know what might occur with respect to the subject property.
The appropriate measure of damages for a partial taking of real property is the difference between the value of the whole property before the taking and the value of the remainder after the taking (Chester Indus. Park Assoc., L.P. v State of New York, 103 AD3d 827 [2d Dept 2013]). The measure of damages must reflect the fair market value of the property in its highest and best use on the date of the taking, whether or not the property is being put to such use at that time (Gyrodyne Co. of Am., Inc. v State of New York, 89 AD3d 988 [2d Dept 2011]).
The taking of a temporary easement entitles the landowner to recover the loss in rental value of the land encompassed within the temporary easement during the term of the appropriation plus further damage, if any, caused to the property (Matter of Kadlec v State of New York, 264 AD2d 420 [2d Dept 1999]).
Rental value of the land encompassed within the temporary easement is calculated by multiplying the square footage of the temporary easement area by the square foot value of the land after the appropriation. That figure is then multiplied by an interest rate for an annual rate of return which is then divided by 12 to arrive at a monthly rental.
The appraisers for the respective parties both agreed that the temporary easement measured 3,811 square feet in total and it was terminated on July 28, 2017, lasting 38 months and 12 days. The parties' calculations of the temporary easement damages included both rental damages for the use and occupancy of the property and consequential or severance damages due to the temporary easement's impact.
With respect to the rental damages for the use and occupancy of the land encompassed within the temporary easement, the court finds that the amount of $8.62 per square foot as set forth by claimants to be the appropriate value of the land. The Court also finds 12% to be the reasonable rate of return. Accordingly, the Court multiplies 3,811 square feet by $8.62 and calculates a total value of $32,851. That total is multiplied by 12%, the rate of return, for a value of $3,942 per year or $328 per month. Multiplying $328 by 38 months and 12 days, the Court finds and awards $12,594 in damages related to rental value of the land encompassed within the temporary easement.
Generally, a claimant is entitled to compensation for any loss suffered as a result of the taking of a temporary easement (Ronmar Realty, Inc. v State of New York, 121 AD3d 1085 [2d Dept 2014]). A temporary easement that leaves the property owner under constant threat that his use of the property may be curtailed or stopped is likely to affect business or other financial decisions even if use is never interrupted in fact. The threat imposed by the condemnor's legal right to occupy may be almost as damaging as the actual occupation and damages caused by such uncertainty are compensable (McCurdy v State of New York, 10 NY3d 234 [2008] quoting Village of Highland Falls v State of New York, 44 NY2d 505 [1978]).
"Where a taking of a temporary easement encumbers a parcel's entire highway frontage, as in the instant case, the measure of damages is 'the rental value of the land encompassed within the temporary easement for so long as the easement is in effect plus, as consequential damages, the rental value of the parcel's unencumbered interior acreage for any period of time when highway access was not possible by virtue of the easement's use' (McCurdy v State of New York, 10 NY3d 234, 235-236 [2008]; see Village of Highland Falls v State of New York, 44 NY2d 505 [1978]). A condemnee is entitled to consequential damages comprising the rental value of the parcel's unencumbered interior acreage for the easement's duration only if the condemnor does not meet its burden of proving the duration of the 'interval of actual obstruction,' or if the condemnee establishes that the 'mere existence' of the temporary easement interfered with highest and best use of the property 'in more than a conjectural sense' (McCurdy v State of New York, 10 NY3d at 236, 241; see Village of Highland Falls v State of New York, 44 NY2d 505 [1978])" (id. at 1087).
Here, as opposed to Ronmar, defendant failed to establish that the disruption and interference with the subject property was limited, sporadic, and of a very brief duration, or that access was never completely blocked, even on days when disruption occurred. Defendant relied solely on the existence of a right of access contained within the language of the temporary easement. Defendant did not present any fact witnesses with first hand knowledge as to the extent of the interval of actual obstruction to the property. As an aside the Court also notes that defendant's expert calculated damages based upon the fact that the costs to cure the negative impacts on the property cannot be completed until the imposition of the temporary easement has been removed.
The credible evidence supports the finding that there was a high degree of uncertainty regarding the temporary easement and what would occur to the subject property during the temporary easement period. The temporary easement, which covered 36.5% of the property was listed as a work easement with no indication that all or part of the temporary easement area would be permanently altered in the form of a non-conforming driveway slope. The evidence established that the State's construction program is a Design Build program where changes made in the course of the work are at the contractor's discretion and are commonplace. There was no plan in place for any buyer or seller to review in order to understand the full extent of the ramifications the temporary easement would have on the subject property. There were multiple designs for grading changes and driveway configuration. Pragna Shah, a DOT Project Manager for the Route 347 project, testified at a deposition on November 16, 2015 that she knew the grade at the Fuschetto property would change but not the extent of the change in grade. One and a half years after the taking date, the extent of the temporary easement's impact on the subject property remained uncertain. This continued to hold true as there were deviations from the May 2016 construction plans. The evidence also established that this was not merely a work area easement as the construction on the State right-of-way necessitated permanent changes to the subject property. The uncertainty of what would occur to the subject property during the temporary easement remained during the time of the temporary easement. Further, that uncertainty remains as the exact extent of the changes were unknown to the experts at trial as final construction plans were not available.
Both appraisers deemed that severance damages for the impact of the temporary easement were warranted. As previously recounted, defendant's appraiser calculated a rental value based upon the total cost to cure during the time of the temporary easement and claimants' appraiser calculated a 50% loss of rent for the entire property during the time of the temporary easement. The Court accepts the measure of damages as determined by claimants' appraiser. Thus, the Court finds and awards $1,022 per month for the duration of the temporary easement. Accordingly, the Court multiplied $1,022 x 38 months and 12 days , and awards $39,244 in severance damages related to the temporary easement.
There is no dispute between the parties that the temporary easement taken by the State caused the removal of trees that provided a privacy buffer to the property and as a result reduced the market value of the subject property. Additionally, there is no dispute that the temporary easement taken by the State created permanent changes to the slope of the property. However, the parties dispute its impact, whether or not there were other permanent impairments, the impact of those impairments and the nature of the damages.
Defendant contends that the non-conforming slope's impact on the property is compensable as a cost to cure damage. The cost to cure approach to compensation is appropriate where an item of damage caused by the State's taking that negatively effects the market value of the property can be cured at a cost less than the diminished value attributable to the damages caused by the taking (Fodera Enters. v State of New York, 275 AD2d 85 [2d Dept 2000]). When the proposed cost to cure requires a permit, the State must meet a threshold burden of presenting evidence as to the likelihood that the permit would be issued (id. at 115.)
The State failed to meet its burden in establishing that a variance for the non-conforming slope would be granted. Mr. Tartaglia's report was silent as to the criteria used to decide an application for a variance for a non-conforming slope or how the non-conforming slope would meet the requirements for a variance. There was also no evidence regarding approval of similar variance applications. Although defendant attempted to establish this information through the testimony of Mr. Tartaglia, he conceded that the last time he applied for a grade variance was approximately 10 years ago. Mr. Tartaglia's report contained language that an unknown official at the Town informed him that variances will most likely be granted for non-conformities caused by condemnations. However, there was nothing specific to grading variances and their likelihood of approval or the likelihood of approving a variance specific to the subject property.
Additionally, the cost to cure damages only account for the costs associated with obtaining a variance. They do not take into account the costs associated with remedying the negative effects of the permanent change in slope to the subject property or the resultant diminishment of overall value to the property.
Moreover, the cost to cure damages do not place the landowners in the same or similar position they were in prior to the taking. After the easement is extinguished the increased slope remains on the property. The evidence established that the new slope is not within Town guidelines, and may in reality be greater than what was contemplated on the 2016 plans.
Mr Berger did not find a diminution in property value due to the permanent change in slope on the subject property. Thus, in regard to those damages the Court is constrained to accept Ms. Brunswick's valuation as the appropriate measure of damages due to the increased change in slope on the subject property.
Nevertheless, the Court does not accept Ms. Brunswick's adjustments for safety of access. "Consequential damages may be recovered where defendant's appropriation has caused access to the remainder of a property to become 'unsuitable,' that is, 'inadequate to the access needs inherent in the highest and best use of the property involved' (Priestly v State of New York, 23 NY2d 152, 155-156 [1968]; see Lake George Assoc. v State of New York, 23 AD3d 737, 738 [2005], affd 7 NY3d 475 [2006]). Access may be rendered unsuitable if the taking of frontage on a property abutting a highway or 'the physical construction of [an] improvement itself, so impairs access to the remaining property that it can no longer sustain its previous highest and best use' (LaBriola v State of New York, 36 NY2d 328, 332 [1975])" (Knickerbocker Dev. Corp. v State of New York, 140 AD3d 1444, 1445 [3d Dept 2016]). Claimants failed to establish that there was a loss of a skewed angle. Claimants also failed to establish that the decrease of driveway size so impaired the remaining property that it could no longer sustain its previous highest and best use. As a result, there is no basis for claimants' adjustments in the safety of access category.
The Court accepts Ms. Brunswick's remaining adjustments for the permanent impacts of the temporary easement on the property.
Accordingly, the Court recalculated the market value of the property as improved after the taking without Ms. Brunswick's adjustments in the safety of access category. After adding those adjustments back into claimants after value calculations, the resulting property values of the comparable properties are $268,000; $276,500; $188,250; and $178,500. After rounding off the average of the comparable sales, the Court finds that the market value of the property after the taking is $228,000. Subtracting $228,000 from the before value of $460,000, the Court finds a diminution in value of $232,000.
As such, the Court awards claimants $232,000 in damages as the appropriate amount for the diminution of the value of the property arising from the permanent change in slope on the value of the subject property.
Lastly, the credible evidence established a value of $5,692 for site improvements taken.
Fence, $4,585; mailbox, $241; and Belgian block, $866 as put forth by Mr. Tartaglia.
Accordingly, claimants are entitled to $232,000 in consequential damages; $12,594 for direct damages related to the rental value of the land encompassed by the temporary easement; $39,244 in severance damages related to the temporary easement; and $5,692 for site improvements taken for a total award of $289,530 with statutory interest from the vesting date of May 16, 2014 to the date of decision and thereafter to date of entry of judgment (see CPLR §§ 5001 and 5002). Suspension of interest is not warranted since the notice of acquisition was served by certified mail, return receipt requested and not by personal service (Sokol v State of New York, 272 AD2d 604 [2000]; see also EDPL 514 [B]).
The award to claimants herein is exclusive of the claims, if any, of persons other than the owners of the appropriated property, their tenants, mortgagees or lienors having any right or interest in any stream, lake, drainage, irrigation ditch or channel, street, road, highway or public or private right-of-way or the bed thereof within the limits of the appropriated property or contiguous thereto; and is exclusive also of claims, if any, for the value of or damage to easements or appurtenant facilities for the construction, operation or maintenance of publicly owned or public service electric, telephone, telegraph, pipe, water, sewer or railroad lines. To the extent the claimants have paid a filing fee, it may be recovered pursuant to Court of Claims Act section 11-a (2).
All other motions on which the Court may have previously reserved or which were not previously determined, are hereby denied.
The Chief Clerk of the Court is hereby directed to enter said Judgment accordingly.
August 3, 2018
Hauppauge, New York
Gina M. Lopez-Summa
Judge of the Court of Claims