assumption that the three covenants in the Mellon deed of December 12, 1956 were valid and enforceable. He made no attempt to determine the value of the property in the event that the covenants were invalid.
The assumption that the three covenants were enforceable was incorrect.
The first covenant prohibiting subdivision constituted a restriction on alienation and, as such, was not enforceable under Pennsylvania law. See Grossman v. Hill, 384 Pa. 590, 122 A.2d 69 (1956).
The second covenant giving R. K. Mellon and Sarah Mellon Scaife the right of first refusal in the event Burt Todd sold the property was personal to R. K. Mellon and Sarah Mellon Scaife. See DeSanno v. Earle, 273 Pa. 265, 117 A. 200 (1922). As such, the covenant terminated upon their deaths. Both R. K. Mellon and Sarah Mellon Scaife died prior to December 30, 1979, the date of the grant of the scenic easement.
The third covenant granting the Rolling Rock Hunt the right to hunt foxes on the property also had terminated prior to December 30, 1979. Rolling Rock Hunt had ceased to exist as an independent entity when it merged with the Westmoreland Hunt to become the Rolling Rock-Westmoreland Hunt.
The fact that this assumption was erroneous does not, however, mean that Mr. Welsch's determination of the "highest and best use" of the property was mistaken. As was indicated previously, the legal use of property is but one factor to be considered. Another factor - in this case the critical factor - is the probable use of the property.
Considering that the area around the Todd property consists of estate-type property, that there existed a strong demand for such estate-type property in 1979-80, that the residents of the area historically have been opposed to development, and that at most three subdivisions exist in all of Ligonier Township, it must be concluded that Mr. Welsch was correct in determining that the "highest and best use" of the Todd property, both before and after the grant of the easement, was as a country estate, and not as property suitable for subdivision.
Plaintiffs' position concerning the correct amount of the charitable deduction for the grant of the scenic easement is untenable.
According to plaintiffs, the diminution in value of their property as a result of the scenic easement was a staggering 40%.
Mr. Ray Barone, expert real estate appraiser for plaintiffs, testified that the total pre-easement value of the property was $ 875,000. The land was evaluated at $ 4,000 per acre, for a total of $ 416,000, and the improvements at $ 459,000. He testified that the total post-easement value of the property was $ 522,000. The land was evaluated at $ 158,000, and the improvements at $ 364,000.
Mr. Barone assumed that the "highest and best" pre-easement use of the property was as a residential subdivision of ten tracts of approximately ten acres each. He further assumed that the "highest and best" post-easement use of the property was as a subdivision consisting of four two-acre parcels, upon each of which was placed a residential dwelling, and of a fifth parcel consisting of ten acres, upon which the existing buildings would be located, plus eighty-six acres of agricultural land.
Mr. Barone estimated each of the four-acre plots to be worth $ 4,000 per acre, the ten-acre plot to be worth $ 4,000 per acre, and the value of the eighty-six agricultural acres to be worth $ 1,000 per acre. He further estimated that the value of the main house had decreased by 15%.
The assumption that the "highest and best use" of the Todd property is as a residential subdivision is erroneous. As was indicated previously, the "highest and best use" of the Todd property is as an undivided country estate. Plaintiffs' determination of the pre- and post-easement values of the Todd property are therefore unreliable. This in turn renders the difference between those values unreliable.
Even if it be assumed that the "highest and best use" of the Todd property was as a residential subdivision, the post-easement evaluation is nonetheless untenable. There is no persuasive justification given either for attaching as much as eighty-six acres to the ten-acre parcel on which the existing buildings stand or for valuing those eighty-six acres at a mere $ 1,000 per acre. This would mean that this particular ninety-six acre parcel of land located in exclusive Ligonier Township would have a fair market value of only $ 126,000. Such a result flies in the face of facts and is wholly implausible.
Judgment therefore will be entered for defendant and against plaintiffs because the defendant's determination as to the allowable charitable deduction is correct, and because defendant's determination is incorrect.
The foregoing constitute findings of fact and conclusions of law pursuant to Fed.R.Civ.P. 52(a).
An appropriate order shall issue.
AND NOW, May 29, 1985, in accordance with the foregoing Memorandum Opinion, IT IS HEREBY ORDERED that judgment is entered for defendant and against plaintiffs.
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