Eminent Domain

In a condemnation proceeding, the City of New York, as condemnor, appealed from Supreme Court's determination, after a nonjury trial, awarding condemnee $3,500,000 in compensation. The Appellate Division modified to reduce the award to $1,625,688 because Supreme Court had based its award on testimony by condemnee's appraiser that was not warranted by the facts.

After condemnee purchased the subject Staten Island property, the state designated a majority of the property as wetlands. Subsequently, the city condemned the land as part of a stormwater management project. The parties stipulated that the value of the condemned property, as regulated, was $248,600, and that the value of the property free of regulation was $4,552,000. At a trial to determine the compensation due to the condemnee, Supreme Court concluded that there was a reasonable possibility that, but for the condemnation proceeding, landowner would have been successful in challenging the wetlands designation as a regulatory taking. The court therefore held that landowner was entitled to an increment above the regulated value of the land, representing the value a reasonable buyer would pay for the probability of a successful challenge to the designation. The court accepted the condemnee's proposed increment of 75% of the unregulated value of the land. The city appealed.