David Hill Development, LLC v. City of Forest Grove et al

Filing 151

ORDER ON DEFENDANTS' OBJECTIONS TO SPECIAL DAMAGES - Defendants' Objections(#137) to Plainitff's Itemized Statement of Damages are overruled. IT IS SO ORDERED. Dated this 1st day of September, 2011, by U.S. Magistrate Judge John V. Acosta. (See attached order for full details.) (peg)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON
PORTLAND DIVISION
DAVID HILL DEVELOPMENT, LLC, an
Oregon limited liability company,
Plaintiff,

08-CV-266-AC
ORDER ON DEFENDANTS'
OBJECTIONS TO SPECIAL DAMAGES

v.
CITY OF FOREST GROVE, an Oregon
municipal corporation; STEVE A. WOOD,
individually and in his capacity as Project
Engineer for the City of Forest Grove; and
ROBERT A. FOSTER, individually and in his
official capacity as Engineering Director and
Public Works Director for the City of Forest
Grove,
Defendants.
ACOSTA, Magistrate Judge
This order address Defendants' Objections to Plaintiffs Itemized Statement of Special
Damages (doc. #137). The court has reviewed and considered the parties' respective arguments,
and defendants' objections are overruled.

Page 1 - ORDER ON DEFENDANTS' OBJECTIONS TO SPECIAL DAMAGES

Specifically, plaintiff submitted an Itemized Statement of Special Damages (doc. #120)
seeking damages in the amount specified for: (1) Decline in Market Value; (2) Increased Cost
Due to Delay; (3) Additional Costs Caused by City's Unlawfill-Conduct; and (4) Opportunity
Costs. Defendants object to these damages as not recoverable under a temporary takings claim.
Rather, defendants contend plaintiff is entitled to recover simply the fair rental value of the
property for the period of the taking. See Yuba Natural Res., Inc. v. United States, 904 F.2d
1577, 1580-81 (Fed. Cir. 1990). Defendants explain any damage caused by a temporaty taking
ends when the taking period is over. Additionally, defendants maintain there is no causal link
between defendants' conduct and loss to plaintiff resulting from market fluctuations. Finally,
defendants object to some of plaintiffs itemized damages as resulting in a double recovety.
In Yuba, the Federal Circuit refused plaintiffs request for market decline damages
primarily because there was "clear and convincing evidence of the fair rental value of the
property." 904 F.2d at 1582. Plaintiff in Yuba was awarded $580,555.40 rental value for the
propetty. The circumstances of Yuba are distinguishable with the present case because there is
no "rental value" for an uncompleted subdivision and defendants' view of the compensation
allowed for a temporaty taking would leave plaintiff without a remedy despite its allegations of
significant interference by defendants with plaintiffs investment-backed expectations.

See

generally Kimball Laundry Co. v. United States, 338 U.S. 1, 7 (1949) (Government
"federalized" a laundry business, i.e., a temporaty taking, during wartime and court rejected a
decline in market value theOlY because "there might frequently be situations in which the owner
would receive no compensation whatever").

Page 2 - ORDER ON DEFENDANTS' OBJECTIONS TO SPECIAL DAMAGES

Defendants' view of the measure of compensation for plaintiff s temporary takings
claims is narrow and focuses on a single method of compensation, i. e., the difference in rental
value. In fact, under defendants' theory of recovery, plaintiff would be awarded no damages for
its takings claim. Plaintiff has alleged intentional misconduct by defendants and is seeking
damages for market decline as well as for the hmm resulting from the alleged interference with
potential sales to specific buyers, and other increased costs due to the delay, including
oppOltunity costs. Plaintiff stipulated to a jury instruction requiring it to prove "extraordinary
delay" in order to prevail on its tempormy takings claim. If plaintiff is successful in proving
extraordinmy delay, it should be entitled to recover compensatory damages as a measure of just
compensation under its tempormy taking claim. See First Evangelical Lutheran Church of

Glendale v. Los Angeles County, 482 U.S. 304, 318 (1987) ("'temporary' takings which ... deny
a landowner all use of his property, are not different in kind from permanent takings, for which
the Constitution clearly requires compensation."); see also Schneider v. County of San Diego,
285 F.3d 784, 790 (9th Cir. 2002) ("change in the market value in the property" during a period
of delay between valuation and the tender of payment was a legitimate element of a just
compensation under the takings clause).
The court previously ruled "the Issue of damages is fact-specific" and should be
determined by the fact-finder, the formula for which shall be established based on the specific
facts of this case." See David Hill v. City of Forest Grove, 688 F. Supp.2d 1203, 1222 (D. Or.
2010). The court is not inclined at this juncture to limit the evidence plaintiff can present to the
jUly to explain its damages.
The court has carefully reviewed the remaining objections to Plaintiffs Itemized
Statement of Special Damages. Plaintiff is not requesting pre-judgment interest separate from
Page 3 - ORDER ON DEFENDANTS' OBJECTIONS TO SPECIAL DAMAGES

the alleged 0ppoliunity costs. Nor is plaintiff permitted to recover twice for the same injUly.
Finally, issues of causation are for the jUly to decide. Accordingly, defendants' Objections to
Plaintiff s Itemized Statement of Damages are Dverruled.
IT IS SO ORDERED.
DATED this

I Ii,f day of September, 2011.

United

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