New York State Court of Claims

New York State Court of Claims

KOSSOW v. THE STATE OF NEW YORK, #2002-005-024, Claim No. 102686



Case Information

Claimant short name:
Footnote (claimant name) :

Footnote (defendant name) :

Third-party claimant(s):

Third-party defendant(s):

Claim number(s):
Motion number(s):

Cross-motion number(s):

Claimant's attorney:
Mayberry & Licht, Esqs.By: Richard S. Mayberry, Esq.
Defendant's attorney:
Eliot Spitzer, Attorney GeneralBy: Reynolds E. Hahn, Assistant Attorney General
Third-party defendant's attorney:

Signature date:
May 15, 2003

Official citation:

Appellate results:

See also (multicaptioned case)


This is a timely filed claim for the partial taking of real property and a temporary easement thereon owned by Claimant Kermith K. Kossow pursuant to the Eminent Domain Procedure Law and §30 of the Highway Law in an appropriation map and description entitled S.H. No. 8223, Pittsford-Victor, Parts 1B and 2, Ontario County, Town of Victor, Maps Nos. 16, 17, Parcels No. 17, 18 filed in the Office of the Clerk of Ontario County.

The appropriation maps and descriptions contained therein are adopted by the Court and incorporated herein by reference. Title vested in the State of New York on January 4, 1999, and the claim was filed with the Clerk of the Court on July 3, 2000. The Court has viewed the property which is the subject of this claim (Court of Claims Act §12[4]).

The subject property is located at the intersection of State Route 96 and State Route 251 in Ontario County. The appraisers utilized essentially the same measurements for distances and area, and the differences were generally not greatly significant. However, my recitation below reflects my resolution of any discrepancies, with an explanation only where it is warranted. Prior to the taking, the parcel was triangular in shape with a frontage of 146 feet on Route 96, frontage on Route 251 of ±186 feet and a hypotenuse or backline of 230 feet. While Claimant's appraisal (Exhibit 1, p 25) estimated a total area of ±15,651 square feet, in their post-trial briefs, both parties agreed with the State's appraisal of a total area of ±16,117 square feet (Exhibit A, p 2). The land was improved with two buildings, some asphalt paving and a seeded lawn. One building was vacant, having previously been a restaurant (1756 square feet). The second building was a tenant-occupied 1½ story cape cod style single family dwelling of about 980 square feet on both the first and second floors.[1]

The parcel is not flat and the topography is irregular as the frontage of the vacant restaurant building was at grade with Route 96, but the parcel then slopes downwardly about 12 feet at the rear of the building, gradually continuing to the parcel's frontage on Route 251.

As part of a project to widen Route 96 and redo its intersection with Route 251, the State appropriated a portion of the parcel, containing ±8,338 square feet, which included the restaurant building and some 6000 square feet of asphalt paving, and also included four underground tanks as it appears this property was utilized as a gas station at some time in the past.

The taking left a remainder parcel of about 7,779 square feet (±0.17 acres), which contains the aforementioned single family house, and had frontage of about 108 feet on Route 251, and a total of 128 feet on Route 96, with the backline now measuring 175 feet. Access remains from both Route 96 and Route 251. In addition a temporary easement extended over an additional 2,243 square feet for a two year period.

Needless to say, this was a small corner parcel prior to the taking, and with the State's appropriation of nearly 52% of the parcel, leaving just some 48% after the taking, valuation of such a minimal remainder was a challenging venture for the appraisers, as well as for the Court.

Claimant and Defendant both concur that the highest and best use of the property before the taking was for commercial development, with the existing single family home removed and the commercial structure used only as a footprint if required by zoning.

A distinction with respect to the highest and best use after the taking exists between the appraisers, who essentially both believe that the remainder is no longer large enough for commercial development, and would probably be best packaged in a sale to an abutting owner. The Defendant's appraiser also suggests the grandfathered, prior non-conforming use of the rental home, and valued the parcel as so improved.

It would be ducking the issue were I not to address prefatory the somewhat contentious issue of the underground tanks, and the asbestos which was contained in the abandoned restaurant, all of which are located in the appropriated parcel. Defendant argues, with some persuasiveness, that the valuation of the parcel as vacant in the before is adversely affected by the costs necessary to make it marketable, to wit, asbestos removal, which he estimated at $8,000.00, and removal of the underground tanks, at $11,100.00. The Defendant also valued the demolition of the restaurant at $3,000.00.[2]
I reject this cost, agreeing with Claimant's argument that this is an expense generally borne by a purchaser. The Defendant argues that the property was not marketable without the incursion of these costs. Accordingly, he valued the land value before the taking, diminished by the hypothetical property preparation, the costs for which he argues must be deducted from the value of the property, costs which I find to be a total of $19,100.00.
Claimant's appraiser utilized the market data approach, eschewing the income approach. The measure of damages is best measured here by finding the pre-taking value of the land and improvements and then assessing the value of the remainder after the taking and determining the difference in total value, if any. The cost approach, generally used for a speciality, is not applicable in the claim at bar (
Matter of Saratoga Harness Racing v Williams, 91 NY2d 639, 645-6). I find the market data approach best suited to the claim at bar, in the before situation.
In his evaluation of the value in the before, Claimant's appraiser did not adjust for any of the remediation costs, described at trial as falling within the "Special Benefits Rule." The Claimant of course takes the position that the State takes the property "as is", and that any cost to adapt the property must be borne by the State, and not the condemnee, and stresses the fact that the appropriated portion of the parcel included the underground tanks as well as the restaurant "contaminated" by asbestos. Claimant speculates that the costs alleged could be obviated should a buyer renovate the restaurant building and reopen a bar/restaurant. On the other hand, there was evidence at trial of a putative purchase offer of $50,000 for the remainder parcel, made by an abutting owner, an acceptable price, but the offer was contingent upon deductions for an environmental cost to cure and the cost of environmental testing totaling roughly $32,500 and a net price of $17,500. This offer was refused but is utilized by Claimant to putatively demonstrate the minimal value of the remainder.

The environmental factors and costs are used as a sword and a shield. On the one hand, Claimant demonstrates an arm's length offer from an abutting owner, the ideal situation contemplated by both appraisers, but wishes to have it reflect the low value after the State's taking. The State however plays the same hand of cards to suggest that the same environmental factors which diminish the after value, depressed the value before taking, thus compressing the traditional measure of damages, the difference between the before value and the after value, to minimal amounts.

Regardless, I will examine the valuations of each appraiser. Defendant finds fault with the appraisal format by Claimant in that his appraiser switches his calculation of value between front footage in the before and square footage in the after situation, fearing that it can lead to potential confusion. Claimant utilized four comparable sales and assessed a front footage adjusted price in the before of $635.00 per foot for 146 feet of frontage on Route 96, finding a before value of $92,710 for the entire parcel. Sale No. 1, vacant commercial land in the Town of Victor, about ten times the size of the subject, and had three times the frontage along Route 96, and Claimant's appraiser found a unit cost of $579.93 per frontage foot. The square foot (sf) value of this parcel was about $1.96, and utilizing Claimant's adjustments, a value of $2.16/sf. Adding +10% adjustments for the ratio for square footage to front footage as well as lot size, and a -10% for zoning, Claimant found an adjusted price of $637.92 per frontage foot (ff). Sale No. 2, also vacant commercial land, in the Town of Farmington, was zoned for residential multi-family use, was of similar size as Sale No. 1, but with only a roughly 50% increase in frontage on Route 96 when compared to the subject. For this comparable, Claimant made significant adjustments totaling +55%, including +10% for location, +25% for the sf:ff ratio[3]
, and +10% each for zoning and location, thus increasing the sale price of $404.75 per frontage foot to an adjusted $627.36/ff. The square foot value of this sale was $.56 per square foot, and an adjusted $.87 per square foot.
Sale No. 3 also consisted of vacant commercial land, slightly less than four times the subject's area with slightly less frontage, albeit on Route 332 in Canandaigua. Claimant's appraiser made a +10% adjustment for location, +15% for the sf:ff ratio, +5% for lot size and -10% for zoning (community commercial), for a net +20%, taking the sale price of $480.00/ff to $576.00/ff. This parcel had a square foot value of $.97/sf, and $1.16/sf after adjustments. Claimant's last sale, No. 4, also vacant commercial land, was part of a three parcel assemblage purchased for a large hotel chain facility in the Town of Victor, was a little more than twice the size of the subject, and had slightly less than 2½ times the frontage on Route 96. This parcel was also subject to substantial adjustment, with -15% each for location and motivation, -5% for the sf:ff ratio and -10% for zoning, for a total of -45%, taking a sale price of $1,189.00/ff to an adjusted price of $653.95/ff. This parcel had a $12.51/sf price, or $6.88/sf after adjustment.

Claimant's appraiser then found a before value of $92,710.00 by assigning a value of $635.00 per frontage foot for the 146 feet of frontage that the subject parcel had on Route 96. Utilizing the area of the subject as 16,117 square feet, this valuation comes to $5.75 per square foot. Frankly this valuation in the before is somewhat skeptical, and I find that it is skewed by the utilization of the assemblage that comprised Sale No. 4, and the residential property in the Town of Farmington (Sale No. 2).

Utilizing the adjustments to Sale No. 1 made by Claimant's appraiser, the subject has an adjusted $2.16/sf valuation and $637.92/ff. Similarly adjusting Sale No. 3 leaves an adjusted area value of $1.16/sf and $576.00/ff. If I were to utilize Claimant's appraiser's front footage as the quantitative measure, and applying a front footage value of say $600.00/ff, the subject would be valued at $87,600.00. However, even were I to apply an area valuation of $2.16/sf, the subject would be valued at only $34,812.72, a significant differentiation from the front footage formula.

Interestingly, the State's appraiser's Sale No. 5, in his Unimproved Sales Analysis in the before situation, is the same parcel as Claimant's Sale No. 1. The adjustments which he made provide an interesting contrast to those of Claimant's appraiser. The State provides a roughly +10% adjustment to the square footage valuation, going from $2.07 to $2.27, leaving aside a roughly 5% difference in area (some 8,000 square feet). That valuation would leave a value in the before of about $36,000.00(R), but of course, the Defendant would reduce that before value by the environmental costs. Defendant's appraiser never considered the front footage valuation methodology proffered by Claimant, but compared six sales, including his No. 5 above, of vacant land, and found square foot valuations, after adjustments for time, area, shape, etc., ranging from $2.19 to $2.76/sf., and rendered an opinion of $2.75/sf (Exhibit A, p 64) or a before value of the land of $44,300.00(R), but would reduce that assessment by the cost of razing the building, asbestos removal, as well as the underground tanks. As noted above, Defendant's appraiser opined the cost of asbestos removal at $8,000.00, and the removal of the tanks at $11,100.00, with demolition costs of $3,000.00 for the restaurant (a cost which I have declined to allocate to Claimant), thus reducing the before value by $22,100.00, for a net of $22,200.00, equating to $1.38/sf for the vacant land. Defendant's appraiser then includes the residence on the premises (which at all pertinent times herein was occupied by tenants) as a "taxpayer", and assesses the contributory value of the residential improvement at $30,000.00 (prior to removing the underground tanks) less the value of the land supporting the residence, which he assessed at $8,000.00, leaves a net value for the building and other improvements for a net of $22,000.00. Adding this amount to the land value provides the Defendant's total before value of $44,200.00.

Again recognizing the difficulty of finding comparable sales for this rather unique parcel, and the disparate valuations presented by the two appraisers, I am not comfortable with Claimant's reliance on frontage valuations to the exclusion of square footage, nor am I at ease with the drastic reduction in the before value which Defendant proffers for remediation of the environmental issues, but I do acknowledge the validity of the asbestos and underground tank removal costs. I agree that the before value is compromised by the environmental flaws and a reduction is warranted. While the State only provided quantitative support for the $3,000.00 for demolition of the restaurant, which I have rejected, I accept the appraiser's testimony with respect to the other environmental costs and diminish the before value by $19,100.00.

As noted above, while Claimant's utilization of the frontage values provides an elevated valuation in the before, reliance on the square footage value alone may unfairly undervalue this property. Thus, I adopt Defendant's methodology (Exhibit A, p 64), but in utilizing its before land value of $2.75/sf, a +10% adjustment for the frontage factor results in a $3.02(R)/sf value for 16,117 square feet or $48,753.93, say $48,750.00, then deducting the environmental costs calculated above of $19,100.00, and adding $22,000.00 for the contributory value of the residential improvement (Exhibit A, p 65), I find a before value of $51,650.00 or $3.20 (R) /sf ($51,650.00 ÷16117sf).

As noted there is a difference of opinion between the appraisers with respect to the highest and best use after the taking. As might be expected, the appraisers opine that the after value has fallen drastically (Claimant) or remained relatively undiminished (Defendant), both attempting to serve their client's best interests. I have discussed above the effect of the taking, leaving just some 48% of the original parcel, and the preferred utilization of the remainder by a sale to an abutting landowner, the Defendant's appraiser makes a cogent and compelling argument that the remainder can be used, as improved, as a residence. That use is grandfathered, legal and non-conforming, although as he opines, it does suffer from some economic obsolescence due to its location in a commercial area on route 96, and the site is small. However, the Defendant also considered its appeal to a certain segment of the real estate rental market.

In attempting to value the diminution in value of the remaining parcel, referred to generally as severance, indirect or consequential damages, Claimant's appraiser has once again provided a market data assessment, using some comparable sales that he used in the before, albeit providing different adjustments thereto, reflecting his opinion of the lesser value of the remainder of the subject, and without my dissection of his appraisal, concludes that the remaining 7,779 square feet should be valued at $.65/sf [4]
or $5056.35, say $5050.00. However, Claimant presented evidence dated November 29, 2001, referencing a contract to buy the remainder property in question by the abutting landowner, which after environmental contingencies left a net price of $17,475.00[5] (Exhibit 3; also see Exhibits C and D). While that contract offer was rejected by the Claimant, I find that it represents the most plausible and accurate valuation of the remaining parcel utilizing Claimant's assessment of the highest and best use of a sale to the abutting owner. Thus, I reject Claimant's appraiser's after valuation of $4,800.00 in Exhibit 1, p 54, and find that the value of the remainder is $17,450.00, say $17,500.00.
The Defendant, cognizant of the market limited to the one abutting landowner, has valued the remainder as improved, for rental as a single family residence. Accordingly, the State's appraiser utilized the income approach and evaluated market rents of four different rentals (Exhibit A, pp 72-73), and opined a monthly rental of $600.00 plus utilities, etc., and calculated a value of $35,500.00. I am persuaded that this income approach to value in the after appraisal is the most realistic valuation of the subject property in what I find to be the highest and best use after the taking, to wit, as residential rental property. It is therefore unnecessary to review Defendant's other after appraisal valuations.

The difference in value of the improved property, between the value before the taking of $51,650.00 and the value after the taking of $35,500.00, is $16,150.00, representing the total amount of severance damages.

With respect to the temporary easement of two years duration, Defendant's appraiser opined that a market rent of 10% per year of the land value is considered to be attainable in the market (Exhibit A, p 86), while the Claimant's appraiser utilized a 20% per year rate (Exhibit 1, p 55). Without more to guide me, I will split the difference and utilize a 15% annual rent, and thus take 2,243 sf @ 3.20/sf x 15% x 2 years = 2,153.28, say $2,150.00. Thus the damages resulting from the temporary easement are $2,150.00.
LAND: 8338 sf @ $ 3.20/sf = $26,700.00 (R)
TOTAL DAMAGES $45,000.00
Thus, Claimant is awarded the sum of $45,000.00 with appropriate interest thereon from January 4, 1999, the date of the taking, until July 4, 1999, six months subsequent to the date of taking, and from July 3, 2000, the date of filing of the claim, to the date of this decision and thereafter to the date of entry of judgment herein, pursuant to CPLR 5001 and CPLR 5002; EDP § 514; Court of Claims Act §19(1); subject to Court of Claims Act §19(4).

The award herein is exclusive of the claims, if any, of persons other than the owners of the appropriated property, its tenants, mortgagees and lienors having any right or interest in any stream, lake, drainage, irrigation ditch or channel, street, road, highway, or public or private right-of-way, or the bed thereof, within the limits of the appropriated property or contiguous thereto, and is exclusive also of the claims, if any, for the value of or damage to easements and appurtenant facilities for the construction, operation, and maintenance of publicly owned or public service electric, telephone, telegraph, pipe, water, sewer, and railroad lines.

All motions not heretofore ruled upon are now denied. To the extent that Claimant has paid a filing fee, it may be recovered pursuant to Court of Claims Act §11-a(2).


May 15, 2003
Rochester, New York

Judge of the Court of Claims

  1. [1]Claimant's appraisal (Exhibit 1, p 26) measured the house at ±998 square feet, while the Defendant's appraisal (Exhibit A, p 49) noted ±936 square feet. After hearing the testimony and reviewing the appraisals, I find an area of 980 square feet to be an accurate measurement.
  2. [2]Defendant's appraiser cited Marshall Valuation Services guidelines for this demolition cost (Exhibit A, p 64).
  3. [3]A square foot (sf) to frontage foot (ff) ratio.
  4. [4]As noted above I have resolved certain measurement disputes, and am applying those measurements which I have found to the values opined (see, e.g., Exhibit 1, p 54)
  5. [5]I realize that Claimant was expected to bear his own closing and title costs, but this letter reflects the net purchase price noted above.