Stewart v. Mayor of Baltimore

Finan, J., delivered the opinion of the Court. The appellee, the Mayor and City Council of Baltimore, filed a petition for condemnation of 6.93 acres of land owned by the appellant, Eleanor Pinkerton Stewart, Trustee for her father and stepmother. The necessity of taking was stipulated and the issue of just compensation was submitted to the jury which returned an inquisition for $50,000 on which the final judgment was based and from which this appeal was taken. The property is roughly semicircular in shape bounded immediately on the north by Winterbourne Road, a public street, and on the south, east and west by Gwynns Falls Park property.

To the north and east of Gwynns Falls Park in the vicinity of the subject property, row house residential and apartment house developments exist, and near the property to the west is Chelsea Terrace, a community of two story cottages. ⁵⁷¹ The subject land has a frontage of approximately 880 feet on Winterbourne Road, a public street which runs from North Hilton Street westerly across Hilton Parkway through the Gwynns Falls Park and Chelsea Terrace, and comes to an end at Nortonia Road. It has a width varying from approximately 30 feet to 50 feet except for that short portion between Hilton Parkway and Chelsea Terrace, for which there is a 20 foot right of way. It is along this narrow portion of Winterbourne Road that the subject property abuts. The entire property has the zoning classification E-40 which permits population density of sixteen families per acre, or a total of about 112 families for the entire property, and building structures to a height of 40 feet.

The property is divided into two lots, the westernmost and smaller lot is approximately 2.93 acres, and a larger lot contains approximately 4 acres. At the time of taking the land was improved by two dwellings, a six room house which was unoccupied and boarded at 3503 Winterbourne Road and a ten room house which was rented at 3501 Winterbourne Road. On July 10, 1962, Mrs. Stewart’s father, Mr. Edwin B. Pinkerton, executed a contract with The Drew Company for the sale of the subject property for a maximum amount of $140,-000 and a minimum amount of $110,000 subject to the condition that a building permit be obtained by the contract purchaser for the development respectively of a maximum of 140 apartment units or a minimum of 110 apartment units on the land. Mr. Edward A. Myerberg, a builder and land developer of forty years experience, is the principal stockholder of The Drew Company and negotiated the contract of sale with Mr. Pinkerton.

Shortly after the contract of sale was executed, Mr. Myerberg, for The Drew Company, submitted a preliminary plan of development and a revised preliminary plan of development of the property (both submitted in the development name of Winterbourne Apartments Company) to the Planning Commission of Baltimore City. After the first plan was submitted, on August 22, 1962, Mr. Myerberg communicated with the Planning Commission which informed him that the plan could be ap ⁵⁷² proved provided additional right of way was acquired to widen Winterbourne Road, but its final decision would depend upon the intent and desire of the Park Board to acquire the property. The revised preliminary development plan received by the Commission on September 6, 1962, showed the property subdivided into three new lots and called for the construction of a 110 unit apartment complex situated on a 30 foot wide drive leading south from Winterbourne Road into the property. This plan- provided for a 15 foot widening strip along the entire frontage of the property on Winterbourne Road, to be dedicated by the property owner to public use.

The plan was referred to and approved by all necessary city departments. The Department of Highways made this comment : “Additional R/W [right of way] should be acquired to provide for paving on Winterbourne Road 34 feet wide and footways on either side. * * Mr. Myerberg testified that after he learned that the approval of a preliminary development plan was dependent upon the intent of the Park Board to take the property, he was told by Dr. Marino, head of the Park Board, that it wanted the property. On September 18, 1962 the Planning Commission rejected the revised preliminary plan. The trial of the case began on Monday June 12, 1967.

The condemnor, (the City) called only two witnesses, private appraisers employed by the City for the purpose of establishing the fair market value of the condemned property. They testified that they originally thought the highest and best use of the property to be for garden type apartments, but that they had been informed by a member of the legal staff of the City that because of the narrow road the property could not be developed for apartment purposes and was suitable for development only as park land. They further testified that their values were arrived at on the comparable sales method but their testimony oriented their comparison to one other sale, an 8 acre tract on Franklintown Road. The City’s appraisers came up with the fair market value of $45,000.

On behalf of the appellant, Edwin B. Pinkerton, the 80 year, old father of the appellant and one of the beneficiaries under ⁵⁷³ her trusteeship, testified the value of the property was $140,000 based on the contract of sale with The Drew Company and the demand for the site for apartment development. The appellant also called as a witness Philip E. Klein, a real estate expert. Mr. Klein expressed his opinion that the highest and best use of the subject property was for the development of garden apartments but he was not allowed to state his opinion as to the fair market value of the property for such a use. The court also ruled him unqualified to state an alternative opinion that, assuming the action of the Planning Commission of 1962 was held by the court to restrict the use of the property in 1967, the present value of the land was $88,000 because, disregarding the condemnation, there arose a more than reasonable probability that the land could be developed consistent with its zoning in the reasonably near future.

Previous to the sustaining of the objections to Mr. Klein’s testimony regarding the use of the property for garden apartments and its value predicated on such use, he had been permitted to testify as to comparable sales of properties zoned for apartment development. Mr. Klein finally was permitted to make the general statement that in his opinion the fair market value of the land was $88,000, but he was not permitted in his testimony to relate this value to the reasonable probability of the property’s highest and best use for garden apartments. The property owner also called Bernard M. Willemain, a qualified land planner, to testify as to the highest and best use of the land and also Mr. William P. Davis, a traffic expert, to testify that anticipated traffic generated by a 110 unit apartment project on the subject property would not place an unreasonable traffic burden on Winterbourne Road, Hilton Parkway or on Hilton Street. Although proffer was made as to what they intended to cover in their testimony, neither of these two witnesses was allowed to testify on the basis that the property owner had not furnished their names to the City in answer to interrogatories as to whom the property owner expected to call as witnesses.

The minutes of the Baltimore City Planning Commission of the meeting held September 18, 1962 were admitted in evidence as the property owmer’s (defendant’s) Exhibit No. 19. ⁵⁷⁴ These minutes reveal that at this meeting at which the preliminary subdivision plan for the subject property was rejected by the Commission, it also placed the subject property in the Master Plan for Parks. The following is a pertinent extract from the minutes: “The Deputy Director explained that the plan was rejected by the Bureau of Highways because of inadequate access to the property. The developer had offered a 15-foot widening strip along the north property line, but as Winterbourne Road is only a 20-foot road at present, it would still not provide adequate access. The Deputy Director also noted that a memorandum from the Park Board recommended that the property be placed in the Master Plan for Parks.

Thereupon, the staff recommended that the preliminary plan be disapproved.” “Mr. Moser suggested that the property on the south side of Winterbourne Road east of Chelsea Road, being adjacent to Gwynn Falls Road, be placed in the Master Plan for Parks. The Park Board had not acted on this, but its staff had recommended that this be done.” * * * “The motion was unanimously adopted, seven members being present.” On October 11, 1962 the Park Board took official action to incorporate the subject property into the Master Plan for Parks. The appellant assigned nine errors on the part of the lower court. These covered rulings on the qualification of witnesses, matters of discovery, admissibility of evidence, exclusion of witnesses and instructions to the jury.

However, we reverse and remand the case for a new trial on the basis of the lower court’s errors in (1) its instructions concerning the highest and best use of the land and (2) its sustaining the city’s objections to the testimony of the property owner’s witness Philip E. Klein, as to the fair market value of- the property based on the rea ⁵⁷⁵ sonable probability of the Planning Commission, in the near future, approving some type of garden apartment development on the property. I The pertinent portion of the court’s instructions which contains prejudicial error regarding the highest and best use of the land is as follows : “There is no legal evidence in the case that the Planning Commission would approve, as of today, the construction of garden type apartments on this property, even though the property is zoned E-40, and under an E-40 zoning classifications, there would be allowed generally the construction of apartments, sixteen apartments to the acre, but the only evidence in the case of the highest and best use of the property, as of today, is for the construction on the property of three dwellings.” (Emphasis supplied.) In our opinion the above instruction was too restrictive and was not cured elsewhere in the court’s instructions. By this instruction the court took the position that the Planning Commission’s rejection of the subdivision plan for the subject property in 1962 effectively prohibited any apartment development of the property at the date of the taking, June 12, 1967, or in the near future, under its existing zoning classification, and limited the use of the property to the then existing two residences, with the possibility of a third residence. The lower court based this instruction on the premise that the property owner submitted no evidence of any other proposed use of the property within the E-40 zoning classification.

Looking at the whole record we believe there was evidence that it was reasonable to anticipate that the Planning Commission would in the near future probably approve the property for some type of garden apartment development. In considering this probability and the evidence in the record concerning it, we must not lose sight of the fact that the property still retained its E-40 classification, so it possessed one of the two basic requirements for garden apartment development, ■which are proper zoning and approval by the Planning Com ⁵⁷⁶ mission. Proper zoning, which is frequently an obstacle in such matters, was not a problem in the instant case. Mr. Edward A. Myerberg, a witness on behalf of the property owner who had personally been involved in real estate developments over the years, testified as to the suitability of the property for garden type apartment development.

He stated in his testimony that he considered the contract between the Drew Company (of which he was the principal stockholder) and the property owner to be viable as of the date of the taking and that the $1,000 paid as earnest money at the execution of the contract was still on deposit. Certainly this was evidence that the purchaser anticipated that the Planning Commission would eventually approve some type of garden apartment development. Mr. Myerberg further testified, in reply to a question put to him on cross-examination regarding the rejection of the subdivision plan by the Planning Commission: “Q. I am talking about the contingencies which you have spelled out in your contract, which you are faced with, the contingencies of being able to get a permit from the Planning Commission ? “A. The Planning Commission, it is my understanding, is willing to issue a — pass plans that we submitted providing however that the road be widened to forty foot, thirty foot bed, and we were willing to give the City of Baltimore the additional land to widen that part of our property which consists of about 750 foot frontage on Winterbourne Avenue. “Q. Winterbourne? “A. Winterbourne Avenue — Road rather. They were willing and ready to do it.

I called personally Dr. Marco. [Dr. Marino, chairman of the Park Board.] “Q. Who did you call? “A. Doctor—he was head of the Park Board at that time.” To be sure, Mr. Myerberg’s testimony, which was uncontradicted, did not establish any formal or informal action taken on the part of the Planning Commission. However, it at least demonstrates that the tentative purchaser, an experienced de ⁵⁷⁷ veloper, considered the eventual approval of the Planning Commission for garden apartment development of the property a reasonable probability and a negotiable matter. Furthermore, the minutes of the Planning Commission’s meeting at which it rejected the preliminary subdivision plan in 1962 state as the reason for the rejection only the general, and unexplained, conclusion: “inadequate access.” Conceivably, the plan may have been rejected for reasons totally irrelevant to the property involved. It may have been rejected because of design policy, because of poor layout or because of some condition existing in 1962, which was totally inapplicable to the property in 1967.

Of course, if the Planning Commission rejected the preliminary plan solely in order to enable the Park Board to acquire the