New York State Court of Claims

New York State Court of Claims

MILAZZO v. THE STATE OF NEW YORK, #2005-031-531, Claim No. 105336


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:
Defendant's attorney:
New York State Attorney General
BY: WILLIAM D. LONERGAN, ESQ.Assistant Attorney General
Third-party defendant's attorney:

Signature date:
September 21, 2005

Official citation:

Appellate results:

See also (multicaptioned case)

Claimant, Michael V. Milazzo, filed claim No. 105336 on December 12, 2001, pursuant to Section 30 of the New York State Highway Law, claiming the State's appropriation of his land damaged him both indirectly and directly. I held a trial on this matter on April 6, 7 and May 3, 2005.

The subject parcel appears on appropriation maps filed in the Erie County Clerk's Office on December 14, 1998 entitled "S.H. 88, Transit, Part I, Town of Clarence, Erie County, Map No. 182, Parcel No. 197." The appropriation maps and description contained therein are adopted by the Court and incorporated by reference. The Defendant has complied with necessary procedures under New York State Eminent Domain Procedure Law with regard to service. I have made the required viewing of the premises. This claim has not been assigned or submitted to any other court or tribunal for audit or determination.

The subject parcel was a portion of Claimant's property, commonly known as 6105 Transit Road, Clarence, New York. At the time of the taking, the parcel was vacant. The amount of land taken is not in dispute. Approximately 10,346 square feet was taken in the nature of a 17 foot strip of land. The strip of land runs parallel to Transit Road along the entire road frontage of the property with a bump out to 23 feet at its northwest corner at Transit Road and Woodbridge Lane (Exh. A, p. 69). The taking left approximately 176,526 square feet remaining. The parties agree that the highest and best use for the property, both before and after the taking, is for commercial development.

The New York State Department of Transportation ("DOT") used the appropriated land to build part of a drainage system along that area of Transit Road. Claimant alleges that DOT's drainage project has damaged his land beyond the mere taking of the strip of land. Claimant asserts that the Defendant caused him to spend money unnecessarily on the diversion of a "ditch"[1]
on his property. He also asserts that DOT's actions have caused more water to flow to and through his property. The interplay between the New York State Department of Environmental Conservation ("DEC"), the United States Corps of Army Engineers ("ACE"), DOT, the towns of Clarence and Amherst, flood plains, watersheds and a country club make this appropriation case an unusual study of the nature of indirect or consequential damages.
Claimant personally purchased the subject property on February 10, 1989 from his construction company, Milazzo V. Milazzo Builder, Inc. (Exh. 1, p. 26; Exh. A, p. 30). The property was unimproved except for a sign identifying the residential subdivision to the immediate east known as Woodbridge Village. The shape of the property is that of an imperfect rectangle. The back lot line is 632.58 feet long and the property was approximately 300 feet deep (Exh. 1, p. 39). The terrain was predominately level with Transit Road except for the ditch or creek which diagonally bisected the property.

It was originally encumbered by two permanent easements. The first was to the County of Erie for drainage. It has the shape of a flag and sits in the southwest corner of the parcel. The easement extends 153 feet along Transit Road at a depth of 30 feet from the southwest corner of the property, then 50 feet more along Transit Road at a depth of 60 feet. The second permanent easement was to the Erie County Sewer District, which is a 17 foot deep strip of land along the parcel's full length of road frontage, approximately 612.21 feet.

This parcel was zoned "Major Arterial" and would have permitted the development of five separate sites on the property. It is also partially located in a designated 100 year flood plain, although the exact dimensions of that portion of the land were not proven at trial (Exh. 1, p. 38).

The subject parcel was originally part of an approximately 29 acre land purchase Claimant negotiated in the early 1980's. A homebuilder and developer, Claimant has been in business over 35 years, according to his testimony at trial. Claimant testified that the 29 acre land deal was in a Planned Unit Residential Development District ("PURD") - the first of its kind in western New York. The first 300 feet of the 29 acres, as measured from the Transit Road right-of-way and then to the east, was designated for commercial development while the remainder was residential.
The "Ditch"
Claimant stated there was an "irregular ditch" running through the 300 foot commercial parcel and that it was dry in the summer but the location substantially hindered his ability to develop the subject property. So, just after Claimant purchased the parcel, he sought and received an opinion from the DEC that the ditch was actually a Class "D" tributary for Gott Creek. Despite the status of the creek, Claimant did not require a "Stream Disturbance Permit" pursuant to Article 15, Title 5 of the NYS Environmental Conservation Law (Exh. A, p. 122; Exh. 1, p. 157). In reliance upon this letter, Claimant hired an engineer and made plans to relocate the creek around the south and east lot lines of the property as depicted by an engineer's 2004 drawing meant to replicate the early 1980's plan (Exh. 1, p. 40). It was actually the parcel to the north of the subject property that was developed first, putting off the creek relocation plans at that time.

Over ten years later, a confluence of two factors caused Claimant and his agents to take another look at the subject property and the creek relocation: 1) the emergence of a prospective purchaser (hereinafter "Huck"); and 2) the Town of Clarence's concern that the realigned creek accommodate an increased volume of water.

Defendant called Diane Kozlowski, the New York Chief of the Permit Evaluation Section of the ACE. At the time the ACE first became involved with the subject property, she was employed as a project manager in the ACE's regulatory branch and, as such, was involved with environmental assessments. Claimant, by his agent, Earth Dimensions, Inc., filed a Joint Application for Permit with the ACE on June 25, 1999, proposing to relocate approximately 670 linear feet of a creek channel (Exh. G). The ACE reviewed a detailed proposed project description with drawings, held a public comment period, and then prepared an environmental assessment that described the impact(s) of the proposed project (Exh. F). The ACE determined that the subject creek was actually an unnamed tributary to Gott Creek that flowed through an upland forest and supported a warm water fishery. And, because the proposed relocation involved relocating more than 200 linear feet, Section 404 of the Clean Water Act regulations required Claimant to apply for and obtain an individual permit from ACE for the proposed project.

Claimant originally planned to relocate the creek along the southern and eastern property lines, creating a right angled ditch and confining it within a berm. While the various agencies that reviewed the plans did not have a problem with Claimant relocating the creek, they did request plan modifications and conditions (Exh. F, pp. 1 - 2).

There is no dispute that the tributary needed to be relocated to "economically develop the site" (Exh. F, p. 2). However, the comments related to the original plan with the right angled ditch centered primarily on the loss of habitat and the potential for flooding. The compromise resulted in a meandering channel along the southern and eastern property lines (Exh. H). The final plan provided for a deeper and wider channel than the original plan. In addition, the compromise included a vegetated shelf and low flow channel for wildlife and a one foot berm to address flooding and storm water runoff issues (Exh. F, pp. 5 - 6). The ACE process acknowledged the concerns that the Town of Clarence had regarding flooding in the adjacent Woodbridge subdivision, particularly the lots abutting the subject parcel on the eastern boundary line and where the channel intersected with Woodbridge Drive. I note the ACE made no determination one way or the other regarding the validity of the Town of Clarence's flooding concerns. Ms. Kozlowski testified that the one foot berm was voluntarily added by Claimant at the Town's request; it was not an ACE permit condition.

Claimant put in proof regarding the projected cost to divert the creek in a right angled channel, as well as the final costs for the actual creek diversion. Claimant's position is that the State created the extra costs, that is, the difference between the right angled version and the meandering version. I am able to make a determination as to the following facts:
  1. That the creek diversion was necessary for the economically feasible development of the parcel.
  2. That Claimant first became aware of the need to divert the creek in the 1980s.
  3. That the creek diversion did not actually occur until at or about the time of the appropriation.
  4. That the DEC was notified of Claimant's intent to divert both in the 1980s and when the Joint Application was filed by Claimant's agent in 1999.
  5. That the DEC had no jurisdiction over the creek diversion although they did apparently comment on the plan.
The one critical fact missing from proof at trial is evidence related to how and where the State caused Claimant the alleged damage, that is the money over and above the cost of the right angled ditch. If the assertion was that the DEC should have informed Claimant when he contacted them in the 1980s that the ACE might have jurisdiction and require a permit, that premise fails because it was not even clear that the ACE would have had any jurisdiction back then. Further, nothing in the proof, or nothing in the law that I can find, requires the DEC to inform Claimant regarding the applicability of federal law. The fact that the State DEC and the federal ACE work together now through a joint application process, does not create any liability on behalf of the Defendant.

Another possible assertion could be that this condemnation and subsequent improvements made by DOT to the Transit Road drainage system somehow caused Claimant the problem. However, this assertion also falls flat in light of the proof at trial in that the permit process was exclusively the jurisdiction of the ACE, a federal agency. Further, the additional condition of the berm was a negotiated point between the Town of Clarence and Claimant related to flooding at Woodbridge Commons - - a residential development built by Claimant. Lastly, Claimant's engineer testified that he contacted the ACE only after a DOT representative told him that the ACE could be involved in the creek relocation. I suppose it might have been cheaper to ask for forgiveness than for permission, but I find no credible theory of liability that would make DOT's recommendation actionable.

I decline to award any consequential damages related to the creek diversion as Claimant has failed to prove a causal connection between Defendant's acts and his damages.
In order for me to find that Claimant has been indirectly damaged by an increased water flow across his property due to DOT's drainage improvement project on Transit Road, Claimant would have to provide proof that the water flow or water level in the watershed encompassing the subject parcel was adversely affected by State action. I note, from the outset, that the subject parcel appears to be partially located in a 100-year flood plain (Exh. 1, p 38 and Section D, p. 184). The portion of the parcel falling within the flood plain was only described as being the "northwest quadrant;" exact dimensions were not provided. The flood plain maps themselves are part of Exhibit 4. While specific dimensions are not referenced on these maps either, it does appear that about one-third of the parcel was in the flood plain on the April 1982 map. However, the next map, in March 1996, depicts a very different circumstance. By 1996, almost all of the subject parcel lay in the flood plain (Exh. 4).

Jeffrey Laprowski, Senior Design Engineer for DOT, testified on a myriad of issues related to the drainage improvement project, including a description of the surrounding watershed before and after the appropriation.

Based on his testimony and Exhibits 4 and 6, I conclude the following:
  1. The subject property was subject to flooding during high storm occurrences prior to the appropriation.
  2. The percentage of Claimant's property in the 100 year flood zone map increased from 1982 to 1996.
  3. The subject property was adjacent to a 290± acre watershed at the northeast corner prior to the appropriation.
  4. Gott Creek runs to the north of the subject property and the general water drainage flow is from the south into Gott Creek in the north.
  5. The water level in the watershed prior to the appropriation was dictated by the water level of Gott Creek.
  6. DOT's design for the Transit Road drainage project divided the original 290± acre watershed, creating two watersheds. The southern portion comprised drainage area 1 and was 180 acres. The northern portion comprised drainage area 2 and was 110 acres.
  7. The post appropriation road work adjacent to the subject parcel was the collection point for the water flow for drainage area 2.
Claimant relied upon the testimony of Mr. Laprowski regarding water flow and water levels in the watershed area both before and after the appropriation. He testified that the main cause of the flooding in the area was the inability of the water in Gott Creek to flow freely under the Transit Road bridge. Prior to the appropriation, the impeded water flow would cause a "back-up" in the watershed. After the appropriation and as part of the construction performed by DOT, the Transit Road bridge over Gott Creek was modified. DOT raised the road elevation two feet and removed the support pillar in the center of the bridge. In his opinion, this increased the flow of Gott Creek, thus lowering the water level.

DOT was certainly aware of flooding patterns that the Town of Clarence had identified and that the Town of Clarence was concerned that the proposed construction would exacerbate the problems. The Town requested that DOT divert storm water flow from the west (Amherst) side of Transit Road, at the Transit Valley Country Club, directly to Gott Creek instead of across Transit Road to the culvert at the subject property (Exh. 4, letter from Latona to Russell, 08/13/98). At trial, Mr. Laprowski testified that DOT did study and review the potential impact of the Town's request. The DOT concluded, however, that diverting the water flow was not necessary because the new pipes, new culvert and planned modification to the Transit Road Bridge over Gott Creek would accommodate the water flow, thereby easing the flooding concerns.

Data related to water flow was provided in a "Hydrology Comparison" chart in Exhibit 4. Claimant pointed out several times during the trial that DOT did not take actual measurements of water levels in the watershed area. The trial record is devoid of actual measurements of water levels, but projections, based on the percentages of pervious and impervious land, and land contours and land elevations within the watershed, were provided. The DOT construction project did have an impact on the flooding conditions on the subject parcel, but the impact was a positive one.

It is an undisputed fact that the level of Gott Creek controls the behavior of the water flow through the watershed and thus, eventually, onto the subject parcel. With the Transit Road bridge modification, the DOT lowered Gott Creek's water level during a 10 year storm, a 50 year storm and a 100 year storm by 3 inches, 4 inches, and 6 inches, respectively (Exh. 4 - "RTE. 78/GOT CR.BIN 1030300 - English Unit," 3 pages). In addition, DOT plans for the drainage improvement project created a situation that significantly increased the efficiency of the water flow patterns by decreasing the amount of land in the watershed immediately adjacent to the subject parcel and by increasing the capacity of the pipes and culvert to hold a greater volume of water. The net effect was that the water flowed faster and in greater volume through the drainage system and back into Gott Creek.[2]
I also note that the improved Class 4 tributary now holds a greater amount of water than the previous ditch that bisected the subject parcel. In sum, the subject parcel is in a 100 year flood plain and will, on occasion, experience some flooding but those experiences will be less intense and less frequent. I will not award any indirect damages for flooding as Claimant failed to show any action by Defendant that has led to increased flooding on the subject parcel.
Value of Appropriated Land
There are three threshold issues to be dealt with immediately related to the land value analysis and the adjustments in the sales comparison analysis. They are: 1) the impact of pre-existing easements; 2) the "mixed zoning" on the subject parcel; and 3) the existence of the diagonal stream channel.

The pre-existing easements belonging to the County of Erie and the Erie County Sewer District have been more particularly described at page 3 of this decision. Together, they comprise a total of .33 acres of the subject parcel's total acreage. Defendant's appraiser separately valued the .33 acres and reduced that value by 25% based on his analysis of selected prior sales that, admittedly, were not an "exact match for the subject's situation" (Exh. A, pp. 64 - 65). I decline to discount the pre-existing easements in such a manner. The value of an easement's effect on the land would be reflected in the ultimate price of the land itself. In addition, "[e]asements themselves are not usually valued" separately (The Appraisal Institute,
The Appraisal of Real Estate, 12th ed., p. 86).
Defendant's appraiser correctly observed that a 33 foot strip of land at the rear of the subject property is zoned PURD - Planned Unit Residential Development. The 33 foot strip abuts the Woodbridge Subdivision. The remainder of the subject parcel is zoned "Major Arterial," which is essentially commercial (Exh. A, p. 34). Property zoned Major Arterial must have a minimum rear setback of 25 feet. The subject parcel actually has a 50 foot setback that encompasses the meandering stream channel (Exh. 1, p.85). Inasmuch as the required minimum rear setback would subsume almost all of the 33 feet of PURD-zoned land, I find that any adjustments on comparable sales or discounts of land value based on the PURD zoning are not appropriate.

However, the existence of the stream bed that diagonally bisected the subject property was an impediment to development of the site. As such, it was appropriately used as an adjustment factor in the sales comparison analysis.

The Before Taking Analysis: Both appraisers relied upon the comparable sales approach.[3]
I have reviewed the appraisal and descriptions of the comparable sales. Based on the appraisals and the testimony at trial, I find that sales numbered 1, 3, 4 and 6 in Exhibit A are the most comparable. All adjustments noted in the chart in Exhibit A, p. 60 are reasonable and accepted except for the adjustment made for zoning differences. Thus, the average per square foot value in the Before Taking Analysis is $2.65.[4] The value of the subject parcel before the appropriation is $495,210.00.
In addition, I note that certain site improvements existed prior to the taking, specifically a subdivision sign for Woodbridge and landscaping. Claimant provided proof of value for the sign only. Defendant appraised the sign and the landscaping. I will allow Defendant's appraiser's value of $4,700.00 for all site improvements.

The After Taking Analysis: Claimant's appraiser used the same comparable sales in this part of the analysis as he did in the "before" situation, except that he included two additional sales. The additional sales were actually the subdivided subject parcel - the northern portion sold to Huck in August 2000 and the remainder transferred in September 2003. The channel diversion work had been completed by the time the property was transferred to Huck; this transfer also took place after the appropriation. I do not see these sales as being comparable to the subject parcel at the time of the appropriation, being too remote in time of sale.

Defendant's appraiser relied upon the same comparable sales as in his before taking analysis. Again, I find sales 1, 3, 4 and 6 in Exhibit A to be the most comparable. All adjustments noted in the chart in Exhibit A, p. 73 are reasonable and accepted except for the adjustment made for zoning differences. The average per square foot value is $2.65. Thus, the value of the land after the taking is $467,794.00.
Claimant has been directly damaged in the amount of $27,416.00 for his land and $4,700.00 for the site improvements for a total amount of $32,116.00, plus interest.

Thus, Claimant is awarded the sum of $ 32,116.00 with appropriate interest thereon from the date of taking December 14, 1998 until June 14, 1999 (six months subsequent to the date of taking), and from December 12, 2001 (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; EDPL § 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 other motions on which the Court may have previously reserved or which were not previously determined, are hereby denied.

It is ordered that, to the extent Claimant has paid a filing fee, it may be recoverable pursuant to Court of Claims Act § 11-a(2).


September 21, 2005
Rochester, New York

Judge of the Court of Claims

[1]Claimant referred to the Class 4 tributary to Gott Creek as a ditch during his testimony.
[2]Exhibit 4, the "Hydrology Comparison" chart sets up the projected flows in before and after scenarios.
[3]Defendant's appraiser nominally looked at the cost approach but concluded it was more applicable to site improvements than the vacant land (Exh. A, p.65).
[4]I used a formula of 1 acre = 43,560 square feet derived from the agreed upon fact that the subject parcel was 4.29 acres and 186,872 square feet.