New York Law Review

Tag: temporary easement

  • McCurdy v. State, 8 N.Y.3d 231 (2007): Damages for Temporary Easements

    McCurdy v. State, 8 N.Y.3d 231 (2007)

    When the state takes a temporary easement, damages are calculated based on the rental value of the land within the easement plus consequential damages for the unencumbered interior acreage only if access was impossible or the easement demonstrably impeded the property’s highest and best use.

    Summary

    McCurdy owned a vacant parcel of land. The State took a temporary easement for highway reconstruction. McCurdy sought damages for the entire rental value of the property for the easement’s duration, arguing it rendered the property undevelopable. The State argued damages should only cover periods of actual access obstruction. The Court of Appeals held that damages should be based on the rental value of the easement area, plus consequential damages (rental value of remainder) only for periods access was impossible, or if McCurdy proved the easement impeded the property’s highest and best use. Since the State proved the limited obstruction, and McCurdy failed to prove impediment to development, the Court remitted for recalculation of damages accordingly.

    Facts

    McCurdy owned a vacant, unimproved parcel of land with frontage on Montauk Highway. The State permanently appropriated a small slice and acquired a temporary easement for grading during highway reconstruction in 1999. The temporary easement covered the entire highway frontage. The easement reserved to the owner the right to use the property, limited only as necessary for construction and maintenance. McCurdy’s appraiser argued the highest and best use was a medical office building, requiring rezoning and a variance. McCurdy’s dental office was on an adjacent lot.

    Procedural History

    McCurdy sued the State in the Court of Claims. The Court of Claims awarded damages based on the rental value of the entire property for the easement’s duration, relying on Matter of Kadlec v State of New York. The Appellate Division affirmed. The Court of Appeals granted the State leave to appeal.

    Issue(s)

    Whether the proper measure of damages for a temporary easement encumbering a vacant parcel’s entire highway frontage is the rental value of the entire parcel for the easement’s duration, or only for the period of actual obstruction, plus consequential damages if the easement demonstrably impeded the property’s highest and best use.

    Holding

    No, because damages should be awarded based on the rental value of the land encompassed within the temporary easement, plus consequential damages representing the rental value of the unencumbered interior acreage for any period of time when highway access was impossible or the condemnee establishes that the mere existence of the temporary easement did, in fact, impede sale or development of the property for its highest and best use.

    Court’s Reasoning

    The Court relied on Village of Highland Falls v. State of New York, which permitted using hindsight to value a temporary easement. Compensation is not required for a temporary easement if there’s no actual interference with the property owner’s use. Here, the State proved access was only obstructed for 7-10 days. The Court acknowledged the “damage to a property owner caused by uncertainty regarding the condemnor’s intentions,” but the easement’s wording reserved claimant’s right of access. McCurdy failed to show the easement interfered with the property’s marketability or development beyond conjecture. He didn’t apply for rezoning, a highway work permit, or a yard-width variance. The court stated, “If the condemnation award is made after the easement has expired, it makes practical sense to compute the property owner’s actual damages rather than indulging in speculation on the measure of damages claimant could have contemplated at the time of taking.” (quoting Village of Highland Falls). There was no evidence McCurdy attempted to sell or develop the property. Therefore, the Court remitted the case for recalculation of damages based on the limited period of actual obstruction.

  • Village of Highland Falls v. State, 44 N.Y.2d 505 (1978): Valuing Temporary Easements Based on Actual Interference

    Village of Highland Falls v. State, 44 N.Y.2d 505 (1978)

    Compensation for a temporary easement should be based on the actual interference with the property owner’s use, not on the potential for interference throughout the entire term of the easement, especially when the easement’s language reserves usage rights to the owner.

    Summary

    The Village of Highland Falls sought compensation for a temporary easement taken by the State for highway purposes on land containing a water treatment facility. The Court of Claims awarded compensation based on the rental value of the entire property for the easement’s duration. However, the Appellate Division reduced the award, considering the limited actual disruption to the facility’s operation. The Court of Appeals affirmed the reduced award, holding that compensation for temporary easements should reflect actual interference with the property owner’s use, particularly when the easement language reserves usage rights to the owner. The court emphasized that retrospective valuation is appropriate when assessing damages after the easement expires, and actual damage is minimal.

    Facts

    The Village of Highland Falls owned a 12.6-acre property containing a water treatment facility. The State appropriated portions of the property for highway construction, including a temporary easement over some vacant land and the land containing the treatment facility. The village sought compensation for the appropriations. The operation of the water treatment facility was significantly interrupted on only three days during the term of the temporary easement.

    Procedural History

    The Court of Claims awarded the Village $85,130 for the temporary easement, based on the purported rental value of the entire property. The Appellate Division reduced the award to $5,640, calculating damages based on the rental value of the treatment facility only for the three days of interrupted operation. The Village appealed to the New York Court of Appeals.

    Issue(s)

    Whether the damages suffered as a result of the State’s appropriation of a temporary easement may be determined retrospectively based on actual interference with the property owner’s use, or whether the determination of damages must be prospective, considering the potential for interference throughout the entire term of the easement.

    Holding

    No, because when valuing a temporary easement after its expiration, it is appropriate to consider the actual interference with the property owner’s use rather than speculating on potential damages, especially when the easement language reserves usage rights to the owner. This approach is particularly suitable when the property owner, a municipality, suffered no significant economic injury as a result of the temporary easement.

    Court’s Reasoning

    The court reasoned that while property taken in eminent domain is generally valued prospectively, using hindsight to value a temporary easement after its expiration is acceptable when the easement contemplates only incidental use. The court highlighted that “when a temporary easement, contemplating only incidental and contingent use, is appropriated, rather than a permanent interest…it may be somewhat more acceptable to permit the use of hindsight in valuing the interest taken.” The court acknowledged the potential damage caused by the uncertainty created by a temporary easement, but emphasized that in this case, the village suffered minimal economic injury. The court cited the language of the easement, which reserved to the village “the right of using said property and such use shall not be further limited or restricted under this easement beyond that which is necessary to effectuate its purposes,” indicating an intention to permit substantially continued use by the village. The court stated that “the Appellate Division’s award fully compensates the Village of Highland Falls for any damages it actually suffered as a result of the State’s temporary easement.” Finally, the court invoked the principle of stare decisis, deferring to prior case law allowing for retrospective valuation of temporary easements, especially where the claimant suffered no true prejudice. The court underscored a caveat: “in valuing the temporary easement, even prospectively, the nature of the easement should be realistically valued in the light of the economic damage the property owner is likely to suffer as a result of the condemnor’s prospective use. Arguably, the easement should not be valued, automatically, as if the condemnor will prevent entirely the property owner’s use of the property, especially where, as here, such pervasive interference is unlikely.”