Eminent Domain Law

Parcels Held in Separate Ownership Property Valued As Single Economic Unit

Matter of Village of Port Chester v. Bologna

NYLJ 5/4/12, p. 32, col. 1

AppDiv, Second Dept.

(memorandum opinion)

In a condemnation proceeding, the village appealed from Supreme Court's award of direct and consequential damages. The Appellate Division affirmed, holding that Supreme Court properly valued separate parcels held in different ownership as a single economic unit for valuation purposes.

The village condemned a number of parcels as part of a redevelopment project. Claimants sought direct and consequential damages, and Supreme Court made an award of $2,850,000 in direct damages and $212,000 in consequential damages. Supreme Court reached the direct damages figure by treating a number of parcels held by separate owners as a single economic unit, relying on evidence that the owners had made efforts to assemble the parcels for construction of a large retail establishment (CVS) even before they had knowledge of a possible condemnation. The village appealed, contending that the parcels should not have been treated as a single economic unit.

In affirming, the Appellate Division conceded that generally, separate parcels should not be valued as a single unit unless there is unity of use and ownership. But the court emphasized that in the current case, there was evidence that the parties had agreed to share expenses, gains and losses with respect to the property, and indicated that even a parol agreement can be sufficient to establish a partnership in reference to the purchase, sale, and ownership of land. The court then turned to evidence that the parties intended to assemble their separate parcels, noting that lease negotiations with a CVS had started before the landowners knew anything about condemnation proceedings. The court also concluded that Supreme Court had properly considered the CVS lease as evidence of value even though the lease was not finalized until after the village started its condemnation proceeding.

Parcels Held in Separate Ownership Property Valued As Single Economic Unit

Matter of Village of Port Chester v. Bologna

NYLJ 5/4/12, p. 32, col. 1

AppDiv, Second Dept.

(memorandum opinion)

In a condemnation proceeding, the village appealed from Supreme Court's award of direct and consequential damages. The Appellate Division affirmed, holding that Supreme Court properly valued separate parcels held in different ownership as a single economic unit for valuation purposes.

The village condemned a number of parcels as part of a redevelopment project. Claimants sought direct and consequential damages, and Supreme Court made an award of $2,850,000 in direct damages and $212,000 in consequential damages. Supreme Court reached the direct damages figure by treating a number of parcels held by separate owners as a single economic unit, relying on evidence that the owners had made efforts to assemble the parcels for construction of a large retail establishment (CVS) even before they had knowledge of a possible condemnation. The village appealed, contending that the parcels should not have been treated as a single economic unit.

In affirming, the Appellate Division conceded that generally, separate parcels should not be valued as a single unit unless there is unity of use and ownership. But the court emphasized that in the current case, there was evidence that the parties had agreed to share expenses, gains and losses with respect to the property, and indicated that even a parol agreement can be sufficient to establish a partnership in reference to the purchase, sale, and ownership of land. The court then turned to evidence that the parties intended to assemble their separate parcels, noting that lease negotiations with a CVS had started before the landowners knew anything about condemnation proceedings. The court also concluded that Supreme Court had properly considered the CVS lease as evidence of value even though the lease was not finalized until after the village started its condemnation proceeding.