Also decided on this docket: Minn. Ct. App., November 18, 2019
The holding in the court’s own words
Reaffirming Strom, we hold today that evidence of construction-related interferen ce that arises after the date of taking is admissible to establish the value of the remainder property.
Quoted verbatim from the opinion — no paraphrase, nothing generated. Not yet human-reviewed. How we find the holding.
Authorities cited
Identified automatically; this list may not be exhaustive.
- State Ex Rel. Humphrey v. Strom 493 N.W.2d 554
- Moorhead Economic Development Authority v. Anda 789 N.W.2d 860
- City of North Oaks v. Sarpal 797 N.W.2d 18
- 942 N.W.2d 182 not in our corpus
- State v. Pahl 95 N.W.2d 85
- City of St. Paul v. Rein Recreation, Inc. 298 N.W.2d 46
- County of Anoka v. Blaine Building Corp. 566 N.W.2d 331
- Adams v. Chicago, Burlington & Northern Railroad 39 N.W. 629
- State v. Hayden Miller Co. 116 N.W.2d 535
- Underwood v. Town Board of Empire 14 N.W.2d 459
- State Ex Rel. Youngquist v. Wheeler 230 N.W. 91
- Minneapolis-Saint Paul Sanitary District v. Fitzpatrick 277 N.W. 394
- Warren v. Dinter 926 N.W.2d 370
Opinion text
1
STATE OF MINNESOTA
IN SUPREME COURT
A19-0473
Court of Appeals Anderson, J.
Took no part, Moore, J.
County of Hennepin,
Appellant,
vs. Filed: September 30, 2020
Office of Appellate Courts
Tamara J. Laechelt,
Respondent.
________________________
Michael O. Freeman, Hennepin County Attorney, Rick J. Sheridan, Assistant County
Attorney, Minneapolis, Minnesota, for appellant.
Jon W. Morphew, Morphew Law Office, P.L.L.C., Minneapolis, Minnesota, for
respondent.
Keith Ellison, Attorney General, Mathew Ferche, Assistant Attorney General, Saint Paul,
Minnesota, for amicus curiae State of Minnesota, Commissioner of Transportation.
Joseph E. Trojack, Assistant Dakota County A ttorney, Hastings, Minn esota, for amicus
curiae Minnesota County Attorneys Association.
Stuart Alger, Bradley J. Gunn, Malkerson Gunn Martin, LLP, Minneapolis, Minnesota;
Gary A. Van Cleve, Rob A. Stefonowicz, Bryan Huntington , Larkin, Hoffman, Daly &
Lindrgren, Ltd., Minneapolis, Minnesota;
Jason A. Lien, Evan Nelson, Maslon LLP, Minneapolis, Minnesota; and
Leland J. Frankman, Frankman Law Offices, Minneapolis, Minnesota, for amicus curiae
Minnesota Eminent Domain Institute.
________________________
2
S Y L L A B U S
In partial taking cases, evidence of construction-related interference that occurs after
the date of taking is admissible to determin e the extent to which the construction-related
interference is a factor in the reduced market value of the remainder property.
Affirmed.
O P I N I O N
ANDERSON, Justice.
Through eminent domain, appellant Henn epin County acquired temporary and
permanent easements from respondent Tamara J. Laechelt. A panel of commissioners was
appointed to determine the amount of compen sation Laechelt should be awarded for the
partial taking of her property. Hennepin County appealed the award of the commissioners
to the district court. Before trial, Hennep in County moved the c ourt to exclude evidence
of construction-related interference because the interference occurred after the date of the
taking. The district court denied the motion. The jury awarded damages to Laechelt, and
the court denied Hennepin County’s motion for a new trial. The court of appeals affirmed.
In State by Humphrey v. Strom, we held that construction-related interference could
be considered as a factor in determining th e amount of damages resu lting from a taking.
493 N.W.2d 554, 560–61 (Minn. 1992). Reaffirming Strom, we hold today that evidence
of construction-related interferen ce that arises after the date of taking is admissible to
establish the value of the remainder property. Accordingly, the district court did not err by
denying Hennepin County a new trial. We therefore affirm the court of appeals.
3
FACTS
Hennepin County commenced a quick-take eminen t domain action pursuant to
Minn. Stat. § 117.042 (2018) to acquire temporary and permanent easements from multiple
landowners, including Laechelt. The district court granted Hennepin County’s petition and
ordered title and possession to transfer to He nnepin County on November 13, 2015. The
district court appointed three commissioners who held a hearing and awarded Laechelt
$35,700 in compensation for the taking. He nnepin County appealed the award to the
district court for a trial de novo as provide d by Minn. Stat. § 117.145 (2018). Hennepin
County moved in limine to preclude any evidence regarding construction-related
interference that occurred after November 13, 2015, the date of the taking. The district
court denied the motion.
At trial, Laechelt introduced evidence, thr ough her appraiser, of the value of her
property that was taken, including the effe ct of construction-related interference that
decreased the market value of the remainde r property. The appraiser’s testimony was
based in part on observations of construction-related interference that had occurred after
November 13, 2015. Laechelt also introduced photographs and testified to her experience
of the construction-related interferences that had occurred on her property after November
13, 2015. By contrast, Hennepin County’s appraiser did not find any diminution in market
value due to construction activity.
The jury returned a special verdict awarding $27,915, which included $2,525 for the
property actually taken, and $25,390 for seve rance damages to the remainder property.
Hennepin County moved for a new trial, arguing that the construction-related interference
4
evidence was improperly admitted. The district court denied the motion for a new trial,
and the court of appeals affirmed the district court. Cnty. of Hennepin v. Laechelt , No.
A19-0473, 2019 WL 6112445, at *3 (Minn. App. Nov. 18, 2019). We granted Hennepin
County’s petition for further review.
ANALYSIS
The issue presented to us is whether evid ence of construction-related interferences
that occur after the date of a taking but before an award of just compensation is admissible
to determine the amount of compensation ow ed to a property ow ner, or whether this
evidence is admissible only if available at the time of a taking.
We review a district court’s new trial decision under an abuse of discretion standard.
Moorhead Econ. Dev. Auth. v. Anda , 789 N.W.2d 860, 892 (Minn. 2010). “Under an
abuse-of-discretion standard, we may overrule the district court when the court’s ruling is
based on an erroneous view of the law.” City of N. Oaks v. Sarpal , 797 N.W.2d 18, 24
(Minn. 2011). Hennepin County argues that th e admission of the posttaking interference
evidence was contrary to our law regarding the admissibility of evidence used to determine
just compensation.
Just compensation must be paid when private property is taken for public use. U.S.
Const. amend. V; Minn. Const. art. I, § 13. In partial taking cases, when only a portion of
the property is acquired by the government, “just compensation includes (1) damages for
the value of land actually taken, and (2) the severance damages to the remaining property
resulting from the land actually taken.” State by Comm’r of Transp. v. Elbert, 942 N.W.2d
182, 192 (Minn. 2020). Damages in partial taking cases are calculated using the “before
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and after” rule. Id. at 188. This rule measures “the difference between the market value
of the entire tract immediately before the taking and the market value of what is left after
the taking.” State by Lord v. Pahl , 95 N.W.2d 85, 90 (Minn. 1959). The date used to
determine the before and after taking market values—i.e., the valuation date—is the date
of the taking for both quick-take and nonquick-take cases. Anda, 789 N.W.2d at 873.
Evidence of any matter that would “influence a prospective purchaser and seller in
fixing the price” may be included wh en assessing severance damages. City of St. Paul v.
Rein Recreation, Inc., 298 N.W.2d 46, 50 (Minn. 1980) (quoting 5 P. Nichols, The Law of
Eminent Domain § 18.11 (3d ed. rev. 19 79)). But damages “must arise from changes in
the land actually taken, and not merely from the impact of the construction project as a
whole.” Cnty. of Anoka v. Blaine Bldg. Corp., 566 N.W.2d 331, 334 (Minn. 1997). When
determining the fair market value of property in a condemnation proceeding, we consider
any competent evidence that legitimately bears on the market value. Strom, 493 N.W.2d
at 559. Evidence must be competent, relevant, and material. Elbert, 942 N.W.2d at 192.
We have said that “because a constitutional pr ovision for just compensation was inserted
for protection of the citizen, it ought to have a liberal interpretation, s o a s to e f f e c t i ts
general purpose.” Anda, 789 N.W.2d at 876 (quoting Adams v. Chicago, Burlington & N.
R.R., 39 N.W. 629, 631 (Minn. 1888)) (internal quotation marks omitted).
One factor that may be considered in a pplying the “before and after” rule is
construction-related interference. Strom, 493 N.W.2d at 560. In Strom, we noted that our
past precedent held that “damages sustained ‘by reason of inconvenience affecting the use
and enjoyment of the remainder may be considered by the jury not as an independent item
6
of loss but as an element which affects th e market value of the remaining area.’ ” Id.
(quoting State by Lord v. Hayden Miller Co., 116 N.W.2d 535, 538 (Minn. 1962)); see also
Underwood v. Town Bd. of Empire, 14 N.W.2d 459, 462 (Minn. 1944) (“It is well settled
that, where part of the owner’s land is taken, resulting inconvenience affecting the use and
the enjoyment of the remainder is proper for consideration as affecting the market value of
the land after the taking.”); State by Youngquist v. Wheeler, 230 N.W. 91, 93 (Minn. 1930)
(stating that inconvenience from a taking “is a proper element of damages in arriving at the
depreciation in the market value”). For exam ple, we said that temporary construction-
related interference such as “vib ration, noise, and dust” is a fa ctor that can be considered
as affecting the market value of the property. Strom, 493 N.W.2d at 560.
Although the general rule is that a property owner “is not entitled to compensation
for any element resulting subsequently to or because of the taking,” that rule is not violated
when the later-acquired evidence is used not to claim a new basis of compensation but to
show the impact on the value of the remainder property at the time of the taking. Anda,
789 N.W.2d at 884 (quoting Minneapolis–St. Paul Sanitary Dist. v. Fitzpatrick, 277 N.W.
394, 399 (Minn. 1937)) (internal quotation ma rks omitted). This af ter-acquired evidence
simply provides the benef it of hindsight. Thus, in Anda we distinguished between a
condition on a property that is discovered after a taking and a change in condition that
occurs after a taking. Id.
Hennepin County advances several arguments urging us to conclude that posttaking
evidence is inadmissible. The core of its argument is that the “decisional law” was changed
in Anda, moving the date of valuation for qui ck-take cases from the date of the
7
commissioners’ award and thereby calli ng into question the reasoning of Strom. But we
have never held, in either quick-take or tr aditional eminent domain proceedings, that the
date of valuation is based on an ything other than the date of the taking. As discussed in
Anda, the compensation for partial taking claims is determined as of the time of the taking.
Id. at 873. Anda thus corrected an erroneous court of appeals view of the law, namely, that
the valuation date in quick-take cases was the date of the commissioners’ award. Id. at 872
& n.6. We have never applied this interpretation. Instead, we have consistently held to the
principle that the “operative concept for the da te of valuation of condemned property is
that time when by the terms of the statute the owner is divested of his title and it vests in
the condemning party.” Id. at 873 (citation omitted) (internal quotation marks omitted).
Indeed, we specifically recognized that principle in Strom, stating with regard to valuation
that “the measure of damages is the difference between the fair market value of the entire
piece of property immediately before the taking and the fair market value of the remainder
of the property after the taking.” Strom, 493 N.W.2d at 558 (emphases added), Hennepin
County’s contention that Anda undermined the reasoning of Strom is mistaken. 1
1 Hennepin County asks us to overturn Strom. Under the principles of stare decisis,
we are “extremely reluctant” to overturn our precedent and “require a compelling reason
to do so.” Warren v. Dinter, 926 N.W.2d 370, 377 n.7 (Minn. 2019) (citations omitted)
(internal quotation marks omitted). We see no co mpelling reason in this case to overturn
Strom. As described in the main text, Henne pin County’s main argument for overturning
Strom—that its basis was supposedly affected by our decision in Anda—is incorrect.
The other arguments Hennepin Co unty presents to overturn Strom are also
unpersuasive. For example, Hennepin County argues that factoring in construction-related
interferences increases the costs of taking. That argument was presented, and rejected, in
Strom. See 493 N.W.2d at 560. Hennepin County al so argues that some statutes enacted
after we decided Strom—for example, Minn. Stat. § 117.031(a) (2018) (requiring an award
of attorney fees to the owner if the last written offer by the conde mning authority to the
8
Hennepin County argues that we have not allowed evidence that occurs after a date
of taking to bear on the am ount of just compensation, but a review of our cases
demonstrates otherwise. In Strom, we considered actual construction-related interferences
that a prospective buyer would consider, such as “vibration, noise, and dust.” 493 N.W.2d
at 560. In arriving at this decision, we rejected the argume nt that such evidence was not
admissible, reasoning that if such evidence were categoric ally excluded, the factfinder
would be valuing a “nonexistent hypothetical piece of property.” Id. at 559. For a separate,
but related, issue in the same case, we held that evidence of a loss of visibility may be
considered when determining the fair market value of the remaining property. Id. at 561–
62. We allowed evidence of the raising of a road by 21 feet, not as a separate item of
damage, but as a factor impacting market value at the time of the taking. Id. at 561. Thus,
in Strom, posttaking evidence of actual damages th at could affect the market value at the
time of the taking was admissible.
In Anda, it was not known that the property ha d been contaminated at the time of
the taking of the property. 789 N.W.2d at 883. The condemning authority discovered the
contamination a month after it had taken the property. Id. We rejected the argument that
the land should be valued as if the contamination was never discovered. Id. We held that,
“when the government condemns property that is contaminated at th e time of the taking,
the property should be valued as of the date of the taki ng, but should be valued ‘as
owner before filing a condemn ation petition is not within 20 percent of the final
condemnation award)—are difficult to apply given the nature of construction-related
interference evidence. That argument is best addressed to the Legislature.
9
remediated’ rather than as contaminated or as clean.” Id. at 885. We held that the stigma
of remediated land may affect its market valu e at the time of taking and thus it should be
valued as remediated, even though the remediation did not occur until after the date of the
taking. Id.
An authoritative treatise on eminent domain also discu sses the issue of hindsight
evidence as it relates to remainder properties and construction-related interference.
Because it is proper for the trier of fa ct to consider all elements that
are a natural and proximate result of the taking and which could legitimately
affect the price that a prospective pur chaser would pay for the land, facts
evidencing the impact on the remainde r during the course of construction,
although temporal in nature, may be the basis for an overall diminution in
value of the remainder and, therefor e, a basis for compensation. The
different elements of damage to remaining land recoverable are as numerous
as the possible forms of in jury. The mere fact that the injuries will be
temporary and incident only to the pe riod of construction is no ground for
disallowing recovery, since a purchaser might well pay less if he or she knew
such injuries were to be inflicted.
This factual issue and its effect on market value have been
summarized by one court as follows:
Each of the elements of dama ge to the remaining land which
the court considered in the present case may be reasonably said
to have affected its market value just after the taking. If, on the
date of the taking, a prospective purchaser had known that for
several years the property would be covered with debris, that
he would suffer discomfort, and that traffic in front of his home
would increase, it is reasonable to believe that the price he
would pay for the property would be affected. In determining
the extent of future damage, the court . . . was not required to
speculate as to the uses to be made of the land or the injuries
resulting therefrom. The court had the benefit of hindsight
(after the construction) and it properly considered the state of
facts which existed during the project and at its completion.
4A Nichols on Eminent Domain § 14A.03 (2020) (emphasis added) (footnotes omitted)
(quoting Bowen v. Ives, 368 A.2d 82, 87 (Conn. 1976)).
10
Our decisions support the conclusion that, when determining the market value of a
taken property, factors such as remediated contamination stigma, construction noise,
vibration, dust, and loss of visibility can be established based on actual evidence of these
factors even though they occur after the date of taki ng. This approach is consistent with
our holding that “any competent evidence may be considered if it legitimately bears upon
the market value.” Strom, 493 N.W.2d at 559 (emphasis added); see also Anda, 789
N.W.2d at 876 (stating that we should liber ally construe just compensation for the
protection of citizens). After-acquired know ledge of the degree of construction-related
interference is relevant to the factfinder because it may shed light on what a willing buyer
and seller might reasonably expect as of the valuation date. Thus, we hold today that
evidence of actual construction-related interferen ce that occurs after the date of taking is
admissible as a factor in establishing the market value of the remainder property.2
The district court therefore did not e rr by admitting Laechelt’s evidence of
construction-related interference, and did not abuse its disc retion in denying Hennepin
County’s motion for new trial.3
2 Laechelt argues that construction-relate d interferences are both a constitutional and
statutory requirement, citing to Minn. Stat. § 117.025, subd. 2 (2018) (defining “taking” to
include “every interference, under the powe r of eminent domain, with the possession,
enjoyment, or value of private property”), as a statutory ba sis for admitting the evidence.
In reaching this decision, we need not decide whether admission of evidence of
construction-related interference is required by either the United States Constitution or the
Minnesota Constitution, or instead is based only on our statutory law, because that issue is
not before us and is not necessary to the resolution of this dispute.
3 There is an outstanding motion by Laeche lt for an award of attorney fees. A party
may move for an award of attorney fees within 14 days after the filing of an opinion. See
11
CONCLUSION
For the foregoing reasons, we affirm the decision of the court of appeals.
Affirmed.
MOORE, J., not having been a member of this court at the time of submission, took
no part in the consideration or decision of this case.
Minn. R. Civ. App. P. 139.05. Thus, we will address the pending motion after the time for
filing postopinion requests or motions has expired.