General Crushed Stone Co. v. New York, 1999 N.Y. Int. 0025 (Feb. 23, 1999).

PROPERTY - EMINENT DOMAIN - JUST COMPESNATION - SECTION 701 ALLOWANCES

ISSUE & DISPOSITION

Issue

Whether, in connection with a proceeding to determine the value of property taken by eminent domain, an application for additional allowances under E.D.P.L. § 701 was timely if it was dated after the entry of judgment and after the Attorney General certified that the State would not appeal the judgment regarding valuation.

Disposition

Yes. The claimant in an eminent domain valuation proceeding can, but need not, apply for allowances under E.D.P.L. § 701 after the entry of a valuation judgment.

SUMMARY

Section 701 of the Eminent Domain Procedure Law (E.D.P.L.) allows the owner of property taken by eminent domain to apply for allowances to recover litigation costs expended to ensure just compensation.

In the instant case, New York exercised its power of eminent domain and took General Stone's bituminous concrete plant in Rochester. New York initially offered $158,250 for the property, and General Crushed Stone filed an appropriation claim with the Court of Claims. After years of pre-trial proceedings, the parties stipulated to both the value of the land and the replacement costs associated with the plant. However, the appropriate appraisal methodology for the property at issue, a "specialty" property, was "replacement cost new less depreciation." Therefore, stipulation did not resolve the parties' dispute. The parties agreed on the replacement cost new, but could not agree on the appropriate amount of depreciation. After trial, the Court of Claims agreed with Claimant's analysis and entered a judgment in the amount of $1,741,992.31.

Following judgement, Claimant submitted an application pursuant to E.D.P.L. § 701 for an additional allowance to cover litigation costs associated with the protracted valuation proceeding. Relying on Ross Lawn Equipment v. New York, 213 A.D.2d 1076 (N.Y. App. Div. 1995), and Niagara Mohawk Power Corp. v. Great Bend Aggregates 181 A.D.2d 998 (N.Y. App. Div. 1992), the Court of Claims and the Appellate Division held that Claimant's application was untimely and that any allowable costs should have been incorporated into the final judgment. The issue presented to the Court of Appeals was whether Claimant's application for an additional allowance under E.D.P.L. § 701 was timely given that it was dated after the entry of judgment and after the Attorney General certified that the State would not be appealing the judgment as to valuation. The Court of Appeals reversed the decisions below, holding that the claimant in an eminent domain valuation proceeding can, but need not, apply for allowances under E.D.P.L. § 701 after the entry of a valuation judgment.

The Court relied on both textual and purposive interpretations of E.D.P.L. § 701. The Court noted that "[t]he text of section 701 has no limitation for the timing of an application for an additional allowance." Furthermore, the Court indicated that it would "disrupt the important remedial purpose of section 701 if [the Court] were to hold that an application for allowable costs must be brought before, and incorporated into, the judgment determining the property's value." The Court remitted the case to the Court of Claims to determine whether Claimant may recover the additional allowances sought in the timely application.

Prepared by the liibulletin-ny Editorial Board.