Kansas high court sides with KDOT in condemnation case involving South Lawrence Trafficway

Kansas Supreme Court Justices take their seats to hear oral arguments in this file photo from Dec. 10, 2015.

? The Kansas Supreme Court on Friday sided with the Kansas Department of Transportation and against a Lawrence construction company in a case involving land that was condemned as part of the South Lawrence Trafficway project.

Doug Garber Construction Inc. owned property in an area that was condemned for the project. Building the trafficway involved destruction of a portion of the Baker Wetlands, and KDOT was required to mitigate that by constructing replacement wetlands.

That involved realigning 31st Street, which required the condemnation of Garber’s property.

The half-acre parcel at 3501 O’Connell Road contained a single residence that Garber had leased to tenants. KDOT initially awarded the company $105,000 for the fair market value of the property, but Garber challenged that in Douglas County District Court, claiming that the highway project itself would make it prime for redevelopment, increasing its value to something between $1.8 million and $3.4 million.

During the trial, Garber sought to introduce expert testimony to back up that claim.

In addition, company president Bernice Garber sought to testify herself that the property could be worth as much as $347 million, based on her plan to develop a privately run “Garber Golden Gateway” on the east side of Lawrence, which the court described as a facility that would “play music and charge cars a toll for entering Lawrence.”

Douglas County District Judge Robert Fairchild, who is now retired, excluded Bernice Garber from offering that testimony, saying her valuation estimate was based on anticipated profits, which are not considered in condemnation cases. He also excluded testimony about the valuation impact that the highway itself would have, saying that violated what’s known as the Project Influence Rule.

That rule states that the increase or decrease in the value of property caused by the project for which it’s being condemned cannot be considered when establishing its fair market value. However, the rule also states that courts can take into account the valuation change caused by another unrelated project.

Garber argued that the South Lawrence Trafficway and the relocation of 31st Street were separate and distinct projects. And since the property was being condemned for the 31st Street relocation, the value should have been based on its proximity to the trafficway.

Fairchild disagreed, however, and ruled that there was no way to separate the two, and that the 31st Street project was just one part of the overall highway project.

The jury in that case awarded Garber $112,000 for the property.

In a unanimous ruling written by Justice Caleb Stegall, the Supreme Court upheld Fairchild’s decision to exclude evidence about the increased value that would be generated by the project. It also upheld his decision to exclude Bernice Garber’s testimony.

“Even if we ignored the speculative character of Ms. Garber’s envisioned ‘Golden Gateway’ to Lawrence, and even if a private citizen could lawfully collect tolls from drivers on a public roadway, such testimony is inadmissible to establish property valuation,” the court said.

Quoting from an earlier decision, it added: “It has long been the rule in this state that the profits from a business conducted on a particular piece of property are not compensable losses in a condemnation action.”