Kw-Dw Properties, LLC v. Arkansas State Highway Commission

          APPEAL FROM THE WHITE COUNTY CIRCUIT COURT [NO. 73CV-16-305-1] HONORABLE THOMAS M. HUGHES, JUDGE

          The Miller Firm, by: Carla L. Miller; and Hopkins, Headlee & Casteel, PLLC, by: Stewart Headlee, for appellant.

          M. Todd Elder; and David S. Long, for appellee.

          COURTNEY HUDSON GOODSON, ASSOCIATE JUSTICE

         Appellants KW-DW Properties, LLC; Debra A. Lang, in her official capacity as White County Tax Assessor; Sue Liles, in her official capacity as White County Tax Collector; certain lands being 2.363 acres, more or less, in White County, Arkansas; and any and all persons or entities claiming an interest therein (collectively KW-DW), ^[1] appeal the White County Circuit Court's entry of a $650 deficiency judgment against the Arkansas State Highway Commission (the Commission) after a jury determined that the Commission owed KW-DW $36, 000 for just compensation in an eminent domain action. We granted the Commission's motion to transfer the case from the court of appeals and now affirm.

         I. Factual and Procedural Background

         On June 21, 2016, the Commission filed a declaration taking approximately 2.363 acres of KW-DW's property. The Commission sought the land in connection with what is commonly known as the Highway 36-Highway 16 project in White County. After the Commission took the acreage needed for the highway, KW-DW's property was divided into two "remainders." The left remainder, located to the west of the future highway, consisted of approximately 5.91 acres after the taking. The right remainder totaled approximately 57.4 acres after the taking. The right remainder included a narrow, approximately two-acre peninsula running south along the highway right of way.

         The Commission deposited $35, 350 with the circuit court as the estimated just compensation for the taking. The matter proceeded to an August 30, 2017 jury trial for final determination of the compensation due. Four witnesses testified at trial. KW-DW's first witness, Adam Whitlow, testified that he is a registered professional land surveyor. Whitlow did not offer an opinion on the value of the property but testified that he was only asked to draw a boundary. Keith Webb, one of the members of KW-DW, testified that before the taking, the value of the entire tract KW-DW owned was $1, 608, 670 at $24, 500 per acre. Webb's opinion was based in part on two recent sales of neighboring property at sales prices of $24, 500 per acre and $25, 000 per acre. In Webb's opinion, the value of the property after the taking was $1, 393, 500. Webb testified that he was entitled to the difference of about $215, 000, which included the value of the property actually taken, as well as damages to the remaining land. KW-DW's expert, Diana L. Thompson, a certified general real estate appraiser, testified that the KW-DW property as a whole had a before-taking value of $18, 000 per acre, for a total value of $1, 181, 880. Thompson acknowledged that the report of the Commission's appraiser concluded that the KW-DW property was worth $15, 000 per acre. Thompson further testified that, after the taking, the KW-DW property was worth $1, 023, 795, for a just-compensation calculation of $158, 085. Thompson's estimate included damages of a 75 percent reduction to the value of the left remainder and a 100 percent reduction to the value of the two-acre portion of the right remainder. David Hall, a surveyor and licensed professional engineer employed by the Commission, testified concerning the possibility of using the remaining property for residential development. Hall determined that the left remainder was suitable for ten residential lots and that the two-acre portion of the right remainder to which Thompson assigned zero value was suitable for three residential lots. Hall did not testify as to a per-acre value.

         The jury determined the final, just compensation due to be $36, 000. The Commission prepared a judgment for the court reflecting an award of $650 to be paid to KW-DW, which represented the difference in the jury's final award and the estimated amount deposited by the Commission. KW-DW did not agree to the proposed judgment, instead arguing that it was entitled to the full $36, 000 in addition to the amount previously deposited. On September 14, 2017, after giving the Commission credit for the $35, 350 already deposited with the court, the circuit court entered judgment against the Commission for the deficiency of $650. On September 22, 2017, KW-DW filed a motion to modify or vacate the judgment pursuant to Rule 60 of the Arkansas Rules of Civil Procedure. That motion was deemed denied after thirty days when the circuit court took no action. KW-DW filed a motion for a new trial on September 28, 2017. The circuit court denied that motion on October 3, 2017. KW-DW filed a timely notice of appeal.

         II. Analysis

         A. The Judgment

         1. The verdict

         KW-DW first argues that the circuit court erred by entering judgment for the $650 deficiency rather than for the full $36, 000 reflected in the jury verdict. KW-DW argues that the circuit court was not authorized to enter judgment against the Commission pursuant to Arkansas Code Annotated § 27-67-317(b) (Supp. 2017). That section provides that

[i]f the compensation finally awarded exceeds the amount of money deposited by twenty percent (20%) or more, the court shall enter judgment against the State of Arkansas and in favor of the party entitled thereto for the amount of the deficiency and shall award the party entitled to judgment its costs, expenses, and reasonable attorney's fees incurred in preparing and conducting the final ...