Bergeman v. State Roads Commission

Prescott, J.,

dissenting in part, filed the following dissenting opinion.

I find myself unable to concur completely in the majority opinion of the Court in this case. In dissenting in part, I shall not attempt to set forth fully the reasons, but shall, more or less, outline them.

The case is one of the State Roads Commission taking private property for public use. In evaluating the value of the property taken, certain expert witnesses were called by the Commission, who testified as to their opinion of the value of the property taken. In order to substantiate their opinion testimony, they were interrogated as to “comparable” sales. 1 This is generally recognized as proper provided the sales, in fact, are comparable, and whether they be comparable is in the sound discretion of the trial judge. Williams v. New York, P. & N. R. Co., 153 Md. 102, 108 , 137 A. 506 . However, this discretion is not unlimited and we have reversed the decision of the trial courts on proper occasions. Lustine v. State Roads Comm., 217 Md. 274, 280 , 142 A. 2d 566 .

*148 It has been held that for such sales to be admissible in evidence the land must be similar and all dissimilarities must be reduced to a minimum. 5 Nichols, Eminent Domain, Sec. 21.3. The land must also be proximate in location and the sale proximate in time. 5 Nichols, op. cit., Sec. 21.31. 2

Bearing in mind the above principles, the Commission offered testimony of four sales of what they claimed to be comparable land for the purpose of buttressing their experts’ opinions. Seasonable objections were made to the admissibility thereof. In my opinion, none of the four was comparable, but I shall only consider two which seem to be markedly dissimilar.

The first was a sale of land across the street from the appellants’ property and close enough to pass the proximity of time and location tests, but it was zoned residential at the 'time of the sale, while the land taken from the appellant was zoned commercial. The reason for the admissibility of this class of evidence is to assist the trier of facts to arrive at the fair market value of the land taken. It does not seem that it .should require any elaborate argument as to why the sale of property zoned residential is not comparable to property zoned commercial, and, therefore, is of little, if any, assistance in arriving at the fair market value of land zoned commercial. It is a matter well known to all that almost universally land zoned for commercial use is of greater value than that zoned for residential purposes, and the range of increase amounts, on numerous occasions, to many times the value of the land zoned for residential use. We have had numerous cases bearing out this statement. For instance, see Congressional School of Aeronautics v. State Roads Comm., 218 Md. 236 , 146 A. 2d 558 , where two experts for the Commission testified that contiguous property zoned residential was of less value than the adjacent land by 50% and 60%, respectively. And in Marino v. City of Baltimore, 215 Md. 206 , 137 A. 2d 198 , there was testimony that if the zoning were changed from residential to commercial, the value would be increased by *149 approximately 1000%. I am unable to concur in a holding that the sale of property zoned for residential use is admissible evidence as a comparable sale to similar property zoned for commercial purposes.

The majority opinion states: “Also, it seems inferable from his [Rayfield, the Commission’s expert’s] testimony that he considered the sales comparable, that he must have taken into consideration the prospect of early rezoning.” The sale being considered was from Hearn, the seller, to Holland, the purchaser. Any probative value that the sale would have to establish value of comparable land would lie in what Hearn as the seller was willing to sell property zoned residential for and what Holland as the purchaser was willing to pay, and Rayfield had no means of knowing what was in the minds of either the purchaser or the seller; consequently, it is difficult to see how the above inference can logically be drawn, even if we assume it would change the status of the properties as to being comparable or not.

The other sale (the Milcar or Morgan one) was made seven years before the trial in this case. The Commission’s expert, Rayfield, testified the sales price was $15,000 according to the stamps on the deed. The evidence developed that the sales price was in reality $20,000. The purchasers were required to make monthly payments for five years, and, at the expiration thereof, a deed was given and the balance of the purchase price (which was the amount represented by the stamps) was paid. While seasonable objection was made to the evidence of this sale, and it was later established (by the appellant) that the sale was made seven years before the taking in this case, the court overruled a motion to strike the evidence concerning it. The majority of this Court, in sustaining this ruling, holds that the testimony of the sale, though made seven years before the trial, was not prejudicial because the appellant was able to explain the facts relating to it. The reason for the rule that sales too remote in time are inadmissible is that they have little, if any, probative worth as to current value. Although the facts of this sale were explained, it was ruled to be admissible testimony by the trial court upon which the appellee was entitled, and presumably, did argue *150 its relation to the present value of the property taken, as well as the substantiation it afforded the expert’s opinion. From this it would seem to be clearly prejudicial to the appellants’ cause.

I also think the objection made to several of the sales that the experts’ knowledge of the purchase price was derived entirely from the stamps on the deeds was well taken. The reason for this seems obvious. As stated in United States v. Katz, 213 F. 2d 799, 800 (1st Cir. 1954) : “More often than not the true consideration paid is not stated in a deed, there appearing only a formal statement of consideration. And the value of the revenue stamps affixed to a deed is determined by the consideration paid exclusive of the value of liens or encumbrances at the time of the sale * * *, so that accurate knowledge of the price paid cannot be calculated from revenue stamps without accurate knowledge of the value of liens and encumbrances on the land at the time of the sale which might or might not appear in the records of the Registry.” See also Nat’l Bk. of Commerce v. City of New Bedford, 56 N. E. 288, 290 (Mass.); Denver v. Quick, 113 P. 2d 999, 1002 (Colo.); 1 Jones, Evidence, Sec. 168; 3 Wigmore, Treatise on Evidence, 52; 2 Lewis, Eminent Domain, Sec. 662; Central R. Co. of N. J. v. Tax Comm., 169 A. 489, 492 (N. J.). And some courts hold that an expert must have personal knowledge of comparable sales. 1 Orgel, Valuation under Bminent Domain, Sec. 132, n. 51, Sec. 133, n. 67. Cf. Patterson v. Mayor & C. C. of Baltimore, 127 Md. 233 , 96 A. 458 ; Williams v. New York, P. & N. R. Co., 153 Md. 102, 108 , 137 A. 506 .

I concur in that part of the opinion which states that there was evidence to support the jury’s verdict, but there is no way to measure the damage done by what I consider inadmissible and prejudicial testimony; therefore I think the judgment should be reversed and the case remanded for a new trial.

. In this regard, evidence of comparable sales is admissible either as primary evidence of value, or to support the opinion of experts.

. Sec. 21.31 [2] n. 60, lists a number of sales that were admitted as being proximate in time, and a number that were not.