Land Clearance Authority v. Doerenhoefer

DONNELLY, Judge.

This is a condemnation case wherein Land Clearance for Redevelopment Authority of the City of St. Louis is the plaintiff-respondent (the Authority), and Jack Esses Distributing Company is the defendant-appellant (Esses).

Esses has appealed from a judgment entered on a jury verdict assessing Esses’ damages at $55,000. The record shows that Esses’ claimed damages totaled $79,022 and evidence was adduced to support said claim. The amount in dispute, therefore, is $24,022. This Court has jurisdiction. Missouri Const.1945, Art. V, § 3, V.A.M.S.; State ex rel. State Highway *386Commission v. Rauscher Chevrolet Co., Mo. Sup., 291 S.W.2d 89.

The property condemned was located on the southeast corner of Fourth and Clark Streets in St. Louis, Missouri. It extended fifty-nine feet, ten inches along Fourth Street and seventy-three feet, two inches along Clark Street, with a building thereon consisting of four floors and a basement. Esses operated a wholesale and retail distributorship of general merchandise.

Esses’ appraiser, George C. Hetlage, testified that the fair market value of the property taken was $79,022. Thomas J. O’Toole, testifying for the Authority, estimated the damages -at $50,000. Charles R. McCoy, testifying for the Authority, estimated the damages at $49,000. The property was taken by condemnation in March, 1963.

The questions on this appeal involve whether the trial court erred in admitting certain testimony.

First, Esses alleges the trial court erred in admitting evidence showing that Esses purchased the property in March of 1954 for $40,000.

In State ex rel. State Highway Commission v. Rauscher Chevrolet Co., supra, 291 S.W.2d 89, this Court stated at page 92: “It is the established rule in this state, and generally, that the price an owner paid for property being condemned is admissible as some evidence of its value at the time of appropriation. That rule applies unless circumstances appear which destroy the revel-ancy or probative value of that otherwise relevant and highly important evidence. For example, the purchase must have been recent and not remote in point of time. Marked changes in conditions or values must not have occurred since the sale. The sale must have been voluntary in the sense that the seller and buyer were each capable and desirous of protecting his interest. The sale must not have been a forced sale, such as a tax or foreclosure sale. ⅜ * * ”

The taking by condemnation in March of 1963, was nine years after the purchase of the property in March, 1954. After the purchase, and before the taking, the Veterans Bridge across the Mississippi River and the Third Street Highway were opened, construction of the riverfront memorial project was begun, the Pierce Building and Cotton Belt Building were remodeled, the Old Courthouse at Fourth and Market Streets was made into a national monument, a new office building was constructed nearby upgrading the neighborhood, railroad tracks along the riverfront were hidden, the construction of the Gateway Arch was started, and Esses had made some improvements on the property. When Esses purchased the property in 1954 for $40,000 it relinquished a five-year lease on the property. This lease encompassed 2,500 square feet on the first floor of the building, 2,500 square feet on the second floor, 4,100 square feet on the fourth floor, and 225 square feet in the basement, for a total rental of $4,200 per year. The record shows that this lease was for five years, beginning in 1950, with a five-year option. There is no evidence as to whether the relinquishment of the lease was favorable or unfavorable to Esses, although there is an inference that the negotiations for purchase were begun pursuant to a request by Mr. Showers, one of the sellers.

Esses contends that the instant case comes within the exception to the general rule set forth in the Rauscher case, supra. We believe that the circumstances in evidence do not destroy the relevancy and probative value of this evidence. In City of St. Louis v. Paramount Shoe Mfg. Co., 237 Mo.App. 200, 168 S.W.2d 149, nine years elapsed and The Great Depression intervened between the purchase and the taking, and similar evidence was there held to be admissible. The testimony here showing Esses purchased the property in March of 1954 for $40,000 was admissible as some evidence of value. The purchase price was relevant evidence in helping the jury to arrive at its verdict. Mr. Hetlage, appraiser for Esses, stated *387that this evidence tended to support his estimate of the value of the property at the time of taking. The verdict assessed Esses’ damages at $55,000. The jury could reasonably have concluded that over the nine-year period since the purchase, and in view of the improvements made by Esses and the upgrading of the neighborhood, the fair market value of the property had increased by the amount of $15,000. The trial court did not abuse its discretion in permitting the jury to consider this evidence. State ex rel. State Highway Commission v. Schutte Inv. Co., Mo.Sup., 334 S.W.2d 241, 246; State ex rel. State Highway Commission v. Johnson, Mo.Sup., 287 S.W.2d 835, 837.

Esses cites Metropolitan St. R. Co. v. Walsh, 197 Mo. 392, 94 S.W. 860, and Kansas City v. Thomson, Mo.Sup., 208 S.W.2d 216, for the proposition that prices paid by the condemning authority for comparable property are not admissible on the question of market value of the condemned property in issue. Esses urges that this rule and the rule announced in the Rauscher case, supra, represent “a double standard.” We do not agree. The Rauscher rule contemplates a situation where the sale is voluntary between seller and buyer. The rule stated in Kansas City v. Thomson, supra, contemplates a situation where an element of coercion is present.

Second, Esses alleges the trial court' erred in admitting evidence that, after Esses moved from the property at Fourth and Clark Streets to a building at Tenth and Clark Streets, Esses paid a rental of twenty-five cents per square foot. The Authority contends this evidence was admissible and cites State ex rel. N. W. Elec. Power Co-op, Inc. v. Waggoner, Mo.App., 319 S.W.2d 930; City of St. Louis v. Paramount Shoe Mfg. Co., supra, 237 Mo.App. 200, 168 S.W.2d 149; and St. Louis Housing Authority v. Bainter, Mo.Sup., 297 S. W.2d 529. In none of these cases was the admissibility of evidence of rental income from comparable properties involved. They are not in point.

While evidence of rental income derived from the property condemned has been held admissible to show the market value of the property, City of St. Louis v. Rossi, 333 Mo. 1092, 64 S.W.2d 600, 607; State ex rel, State Highway Commission v. Flynn, Mo. App., 263 S.W.2d 854, 857, evidence of rental value of comparable property in the neighborhood is generally not admissible to prove the fair rental value of the property condemned. State ex rel. State Highway Commission v. Vorhof-Duenke Co., (En Banc) Mo.Sup., 366 S.W.2d 329, 340 [16]; 5 Nichols on Eminent Domain, 3rd Ed., § 19.21 [1], and thirteen cases there cited, from eight jurisdictions. The reason is that such testimony “does not have the independent evidentiary value of an arms-length sale of comparable property in the vicinity.” State ex rel. State Highway Commission v. Vorhof-Duenke Co., supra, 366 S.W.2d 329, 340, that would “warrant the extension of the field of controversy and fact finding which is entailed in its admission.” 5 Nichols, supra, § 19.21 [1]. Therefore, if this evidence had been offered in the first instance by the Authority, it would have been properly excluded. However, other factors must be considered.

The record shows that early in the trial, the Authority, on cross-examination of Jack Esses, attempted to get before the jury evidence of the twenty-five cents per square foot rental paid by Esses under the lease at the location at Tenth and Clark Streets. At that time Esses’ objection to this evidence was sustained by the trial court. Later in the trial, on direct examination, to establish market value of the property condemned, Esses’ expert witness Het-lage undertook to show its rental value. The property was not being rented because occupied by the owner, so it was necessary to establish a hypothetical rental value of the property. To do so Hetlage testified as *388to rentals received on comparable properties. His testimony, in part, is as follows:

“Q. I don’t mean to interrupt. If you’re going to move on to the next approach, why, you just go ahead.

“A. Well, on the basis of the capitalization of the income we arrived at a figure of some forty-one cents per square foot as reasonable annual rental for the space.

“Q. How did you arrive at the average, Mr. Hetlage?

“A. We visited other properties in the area and secured rentals that were being paid on similarly occupied somewhat smaller properties.

“Q. Can you tell what other properties you’re talking about?

******

“THE WITNESS: There was the Washau property, two doors south of the subject property. I do not have the street ad[d]ress. This premise here rented at an average of forty-one and eight tenths cents per square foot, and had no elevator, and was rather inferior to the subject property.

“Another property was [sic] investigated was one occupied by the Mass. Sales Co. This was at 306 South Fourth Street, and next door to the subject property. It figured out to have a rental of sixty and one-half cents per square foot of floor area. In this case we felt that the property had an elevator and we felt in some respect ii was superior to the subject property.

“Another one that was investigated was Proctor Sales. That was in the block north of the subject property. It had no elevator. It too, was considered to be somewhat superior to the subject property. It rented at seventy cents per square foot.

“I felt these things justified the conclusion that we arrived at for this rental rate. * *

On cross-examination, Hetlage was questioned as to the rental paid (twenty-five cents per square foot) at the Tenth and Clark Streets location. At this time, and later when similar evidence was elicited from the Authority’s witness O’Toole, Esses’ objections were overruled by the trial court.

We regard this chain of events significant. The trial court did not allow evidence of the rental paid at Tenth and Clark Streets until after Esses had introduced evidence of rental income from properties in the area other than the condemned property. Esses injected the matter of comparable rentals into the case and is in no position to complain here. State ex rel. State Highway Commission v. Schutte Inv. Co., supra, 334 S.W.2d 241, 247; 88 C.J.S. Trial § 116, p. 236; 31A C.J.S. Evidence § 190a, pp. 509-512. “Where a party voluntarily accepts an evidentiary theory tendered by his adversary and offers evidence of the same kind and character, he waives his right to assert on appeal that his opponent’s evidence was erroneously admitted. * * * ” Jackson County v. Meyer, Mo.Sup., 356 S.W.2d 892, 897.

The trial court did not abuse its discretion when it admitted the evidence in question. Biener v. St. Louis Public Service Co., Mo.App., 160 S.W.2d 780, 786.

The judgment is affirmed.

HYDE, HENLEY and EAGER, JJ., concur; HOLMAN, J., dissents in separate dissenting opinion filed; FINCH, J., dissents in separate dissenting opinion filed; and STORCKMAN, C. J., dissents and concurs in separate dissenting opinions of HOLMAN, J., and FINCH, J.