Type: Real Property, Eminent Domain, Just Compensation

Jury Verdict: $320,205 for defendant (including $250,000 for severance damages), plus post-judgment award of $86,115 for litigation expenses.

Case/Number:  City of Palmdale v. Harold Riff, et al. /  BC136988

Court/Date: L.A. Superior  Central / Sept. 8, 1997

Judge: Reginald A. Dunn, Dept. 44

Attorneys: Plaintiff- C. Edward Dilkes  (Richards, Watson & Gershon, L.A.). Defendant- Jeffrey Z.B. Springer, Robert P. Silverstein (Demetriou, Del Guercio, Springer & Francis LLP, L.A.)

Technical Experts: Plaintiff - Marvin E. Lopata real estate appraiser, Woodland Hills; Molly Bogh, land use, zoning, and entitlement, Palmdale; Michael Mischel, land use, entitlement and seismic issues, Palmdale. Defendant - Norman Eichel MAI, real estate appraiser, Reseda; James R. Ashby, geologist, Irvine; David Weston, civil engineer, Van Nuys

FACTS: On Oct. 12, 1995, plaintiff City of Palmdale filed an eminent domain action to acquire a portion The plaintiff moved in limine to exclude all evidence and testimony regarding the probability of a zone change on the master parcel. In this connection, the court granted the plaintiff's request for a hearing outside the presence of the jury pursuant to People v. Arthofer (1966) 245 Cal.App.2d 454 to determine whether the defendant's real estate appraisal expert, Norman Eichel, had sufficient expertise to offer an opinion on the reasonable probability of a zone change and whether he had conducted a sufficient investigation to permit him to testify on the issue of a zone change. The defendant called Norman Eichel to state his opinion and provide his reasons for concluding that there was a reasonable probability of a zone change to permit a commercial use on the master parcel. The plaintiff examined Eichel on voir dire for approximately one day. Upon hearing the testimony, arguments of counsel, and the matter being submitted to the court for decision, the court denied the plaintiff's in limine motion on the grounds that there was a sufficient foundation for the opinion and that Eichel's opinion was not merely speculative or conjectural under the standard set forth in Arthofer. A jury was then impaneled to try the action as to the fair market value of the property being taken and the severance damages to the master parcel.

Contentions: The plaintiff contended that just compensation for the taking of the commercially zoned area was $15,000, and that the defendant was not entitled to severance damages related to the master parcel because there was no probability of a zone change back to commercial for the master parcel and because seismic issues on the master parcel would prevent commercial use of the property. Accordingly, the plaintiff valued the severance damages to the master parcel at zero and made no offer of just compensation for this element of damage. The defendant contended that in the before condition, the master parcel had a reasonable probability of a zone change back to commercial. The defendant also contended that by moving 25th Street East away from the defendant's property and constructing the trail parking lot between the new 25th Street East and the master parcel, the master parcel lost its corner prominence, visibility, and frontage at an intersection designated as a "Gateway to the City" in Palmdale's General Plan and in immediate proximity to the busy commuter corridor along Pearblossom Highway. The defendant further contended that this caused significant severance damages to the master parcel, which the defendant claimed could have been developed for profitable commercial use in the before condition. Specifically, the defendant argued that after physical modifications to the property and compliance with the Alquist-Priolo Act regarding minimum set-back zones from active fault traces, a gasoline service station, convenience store, and office buildings could have been constructed on a portion of the master parcel before the taking.

Damages: The defendant sought just compensation of $143,000 for the commercially zoned fee taking area and $485,535 for severance damages to the master parcel, for a total just compensation award for these damages of $628,535.

Jury trial: Length 10 days; Deliberation three days

Settlement Discussions: The city of Palmdale made a final settlement offer of $33,500 at the settlement conference. The defendant made a final settlement demand of $325,000.

Settlement Conference: A mandatory settlement conference was held on March 14, 1997. It did not resolve the matter.

Other Information: The verdict was reached approximately one year and 11 months after the case was filed. Pursuant to Code of Civil Procedure §1250.410, the court found that Palmdale’s final offer was unreasonable in light of the evidence admitted and the compensation awarded, and additionally ordered Palmdale to pay the defendant’s litigation expenses in the amount of $86,115.