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Lower Makefield Township v. Lands of Chester Dalgewicz

September 1, 2010

LOWER MAKEFIELD TOWNSHIP, APPELLANT
v.
THE LANDS OF CHESTER DALGEWICZ AND CHRISTINE DALGEWICZ, HUSBAND AND WIFE; JOHN E. DALGEWICZ; CHESTER W. DALGEWICZ, JANE CICHOCKI; RICHARD K. DALGEWICZ AND CHRISTINE K. NEWMAN, OF LOWER MAKEFIELD TOWNSHIP, COUNTY OF BUCKS COMMONWEALTH OF PENNSYLVANIA



The opinion of the court was delivered by: Judge McGINLEY

Argued: May 17, 2010

BEFORE: HONORABLE BONNIE BRIGANCE LEADBETTER, President Judge, HONORABLE BERNARD L. McGINLEY, Judge, HONORABLE JOHNNY J. BUTLER, Judge.

OPINION

Lower Makefield Township (Township) appeals from the order of the Court of Common Pleas of Bucks County (trial court) which denied its motion for post trial relief following a jury verdict in this Eminent Domain case. The jury awarded the Dalgewicz family (Condemnees) $5,850,000 as just compensation for the taking of their 166-acre farm (Property) on December 6, 1996, for construction of a golf course.

On July 11, 2001, this Court ruled that the taking was for a legitimate public use. The parties proceeded to a Board of View hearing in May of 2003. The Board of View valued the property at $3,990,000. On February 20, 2004, Condemnees filed an appeal and the matter proceeded to a jury trial on the issue of damages.

The trial was held over six days in November 2008. There were a total of eleven witnesses.*fn1 At the conclusion of the trial, the jury determined that the Township owed Condemnees $5,850,000 as just compensation for the taking.

On appeal*fn2 , the Township raises four issues. The first three issues are challenges to the trial court's evidentiary rulings regarding: (1) the admissibility of an executed Agreement of Sale between Condemnees and Toll Brothers for $7 million dated December 16, 1998; (2) the admissibility of an unaccepted offer made by Pulte Home Corporation in 1998 to purchase the Property for $8 million; and (3) the cross-examination of the Township's expert witness, Craig Gleason (Gleason), using a prior appraisal prepared for the Township by William Mount (Mount).

The fourth issue challenges the trial court's decision to try the case by jury where Condemnees mistakenly failed to formally request a jury trial in their Notice of Appeal from the Board of View.

I.

Admissibility of December 16, 1998 Agreement of Sale Between Condemnees and Toll Brothers

Toll Brothers, Inc. was a real estate development company which made an offer to purchase the Property, subject to the taking being overturned, for a conditional price dependent on the number of lots approved for development.*fn3 Condemnees' counsel introduced the Toll Agreement through the direct examination of Chet Dalgewicz (C. Dalgewicz) who testified that his family executed the Toll Brothers Agreement on December 16, 1998. Condemnees offered the December 1998 Toll Brothers Agreement as evidence of the value of the Property on the date of condemnation.

The Township argues in this appeal that the December 1998 Toll Agreement should have been excluded because it was executed more than two years after the taking in 1996. It maintains that fluctuations in market conditions between the time of the taking and the date of the agreement rendered the agreement irrelevant.

The Eminent Domain Code limits the admissibility of agreements of sale as evidence of the value of condemned property to agreements "made within a reasonable time before or after the condemnation." 26 Pa.C.S. §1105 (Emphasis added).

It is within the trial court's discretion to admit an agreement of sale for the subject property, executed either before or after the taking, as evidence of a comparable sale where the court finds the agreement probative and relevant to determining the fair market value of the property on the date of condemnation. Tedesco v. Municipal Authority of Hazle Township, 799 A.2d 931 (Pa. Cmwlth. 2002). The admission or exclusion of such evidence is within the sound discretion of the trial court, whose decisions will not be disturbed absent an abuse of discretion. Lehigh-Northampton Airport Authority v. Fuller, 862 A.2d 159 (Pa. Cmwlth. 2004).

Pennsylvania law does not involve a bright line test to determine probative value, but instead permits a review of the totality of the circumstances surrounding the agreement to determine whether it constitutes a reasonable indicator of the value of the subject property. In Re Development of Authority of City of Harrisburg, 386 A.2d 1052 (Pa. Cmwlth. 1978). Factors which affect a trial court's determination include: the length of time between the date of the comparable agreement and the date of condemnation; fluctuation in the real estate market during that period; and changes in the character of the property over that time. Harrisburg, 386 A.2d at 1058. Whether particular sales or agreements are probative and relevant and thereby admissible are determined on a case-by-case basis. Tedesco.

In Tedesco, the trial court admitted into evidence a comparable agreement of sale executed six years prior to the date of condemnation. Condemnees appealed and alleged that the trial court's admission of the agreement was reversible error. Condemnees argued, among other things, that changes in the real estate market during the period of time between the agreement of sale and the condemnation nullified the probative value of the agreement to determine the fair market value on the date of condemnation. This Court disagreed and found that while market fluctuation did occur, it did not preclude admission of a comparable sale where "the factual differences in the market were well developed for the jury through direct examination, competent cross-examination and . other evidence." Tedesco, 799 A.2d at 936.

In the present controversy, as in Tedesco, issues regarding fluctuation in the market were properly addressed and challenged in extensive testimony at trial. Condemnees' Appraiser, George Sengpiel (Sengpiel), offered extensive testimony on direct examination regarding fluctuations in the Lower Makefield Township real estate market from the mid 1980's to the time of trial. Notes of Testimony, November 18, 2008, (N.T., 11/18/08) at 179-188; Reproduced Record (R.R.) at 437a-439a. The Township cross-examined Sengpiel about this market fluctuation, specifically with respect to how the changing market affected the Property's value between the date of the condemnation and the execution of the Toll Agreement. Notes of Testimony, November 19, 2008 (N.T., 11/19/08) at 113-124; R.R. at 477a-479a. The Township also cross-examined C. Dalgewicz regarding the change in market conditions, and the fact that the market for raw land in Lower Makefield was increasing during the period from 1995 through 1998. N.T., 11/18/08, at 58-60; R.R. at 407a.

Through this evidence and testimony, the jury was provided the facts and context necessary to consider and adjust the value of the 1998 Toll Agreement to account for changes in the market. Pursuant to Tedesco, this Court finds the trial court ...


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