Commissioner of Transportation v. Bakery Place Limited Partnership, et al.

In this condemnation action, the
plaintiff, the commissioner of transportation (commissioner),
appeals from the judgment of the trial court
rendered in favor of the defendant Bakery Place Limited
Partnership (defendant).1 On appeal, the commissioner
claims that the court improperly (1) took judicial notice
of the fact that asbestos in the property acquired by
eminent domain could have been encapsulated at a
lower cost than demolishing the building and (2) determined
the fair market value of the condemned property
on the basis of a five year old municipal property tax
assessment. We reverse the judgment of the trial court.

Vincenzo Miceli and Valerie Miceli operated a bakery
at 648 Main Street in New Britain from 1974 until they
sold the business in 1989, retaining ownership of the
property. In 1985, the Micelis formed a partnership
known as Bakery Place Limited Partnership and purchased
property adjacent to the bakery located at 634-
640 Main Street, New Britain, which is the subject of
this appeal. The defendant's newly acquired property
consisted of a 6394 square foot parcel of land with a
vacant three story building that was constructed in
1886. The defendant purchased the property to expand
its bakery business. Shortly after preparing the building
for renovation,2 Vincenzo Miceli became ill and construction
was halted. On June 7, 2000, the commissioner
paid the defendant $1 to acquire the property on 634-
640 Main Street by eminent domain in order to make
highway safety improvements. The defendant appealed
to the Superior Court.3

The dispute before the court involved the cost of
demolishing the building at the time of the taking. Prior
to the condemnation of the property, the defendant's
appraiser, Matthew Welinsky, appraised the property
and found that the highest and best use of the property,
after the demolition of the building, was to keep it as
vacant land. Using the comparable sales method, he
concluded that the fair market value of the vacant land
was $13,000. Welinsky, referring to the Marshal Valuation
Service on demolition and removal of hazardous
material, calculated the cost of demolition to be $8000.
He determined that the fair market value of the land
was $5000.

Likewise, the commissioner's appraiser, John Nitz,
concluded that the highest and best use of the property
was vacant land. He also valued the property at $13,000.
On the basis of his assumption that asbestos was present
in the building,4 Nitz calculated that the cost of
asbestos removal and demolition of the building would
total $17,096, which would leave the market value of
the property at a $4000 loss. In addition to Nitz's testimony
as to the value of the property before condemnation,
the commissioner offered the expert testimony of
Eric Plimpton, a licensed professional engineer. Plimpton,
who reviewed the invoices from the demolition of
the building on the property,5 testified that the actual
cost to demolish the building was $35,208 and $22,334
to remove the asbestos for a total cost of $57,542.
In its memorandum of decision, the court relied on
the following facts to determine the fair market value of
the property. In October, 1995, the New Britain assessor
revalued the property and determined that its fair market
value was $37,840. The defendant paid the real
estate taxes based on the fair market value of the property
for the next five years. The assessor's street card
listed the property's income as $80,300. Using the cost
approach, the city determined that the value of the land
as vacant was $27,550 and the building was $10,290 for
a total value of $37,840. The city used the cost approach
of $37,840, not the income approach at $80,300, to determine
the fair market value of the subject property. The
assessor's street card showed that the building in 1988
was uninhabitable and therefore incapable of producing
income. That assessment remained unchanged until the
date of the taking. The court concluded that the city's
revaluation in 1995 of the building at $10,290 took into
account the existing condition of the property.

The court further concluded that ‘‘[n]either Welinsky,
Nitz nor Plimpton made any credible contribution
regarding the existence of asbestos or the extent of
asbestos in the building. From the presentation of evidence,
we can assume the presence of asbestos in the
building, but cannot determine the extent of the asbestos
in the building. Our general experience is that asbestos
insulation used to insulate heating ducts in older
buildings may be encapsulated to prevent harm from
asbestos as an alternative to removal.'' The court
rejected the appraisers' opinions that the highest and
best use of the property was as vacant land and instead
concluded that the value of the property would be maximized
by encapsulating the asbestos rather than demolishing
the premises at a substantial loss. The court
also noted that the cost of encapsulation is minimal
compared to the cost of asbestos removal.

The court rendered judgment in favor of the defendant
‘‘in the amount of $37,840, less the sum of $1 paid
by the [commissioner] plus statutory interest at the rate
of 10 percent as provided in General Statutes § 37-3a,
from the date of taking.'' The court subsequently denied
the commissioner's motion for reconsideration. This
appeal followed.

I

The commissioner first claims that the court improperly
took judicial notice of the fact that asbestos in the
property acquired by eminent domain feasibly could
be encapsulated at a lower cost than demolishing the
building. Specifically, the commissioner argues that the
court's conclusion in its memorandum of decision, without
evidence, that ‘‘[o]ur general experience is that
asbestos insulation used to insulate heating ducts in
older buildings may be encapsulated to prevent harm
from asbestos as an alternative to removal'' was
improper.6 The commissioner contends that whether
asbestos in the building could be safely and economically
contained was not a proper subject for judicial
notice. We agree.

‘‘Courts may take judicial notice of matters which
come to the knowledge of men generally in the course
of the ordinary experience of life, and are therefore in
the mind of the trier, or they may be matters which are
generally accepted by mankind as true and are capable
of ready and unquestionable demonstration. . . .
Facts which are of common knowledge, that is, facts
so well known that evidence to prove them is unnecessary
are proper subjects of judicial notice.'' (Citations
omitted; internal quotation marks omitted.) Federal
Deposit Ins. Corp. v. Napert-Boyer Partnership, 40
Conn. App. 434, 442, 671 A.2d 1303 (1996).

‘‘The doctrine of judicial notice is not a hard and fast
one. It is modified by judicial discretion. . . . Courts
are not bound to take judicial notice of matters of fact.
. . . Thus, a trial court's determination [to take or] not
to take judicial notice is essentially an evidentiary ruling.
. . . Our role in reviewing evidentiary rulings of
the trial court is settled. The trial court has wide discretion
in its rulings on evidence and its rulings will be
reversed only if the court has abused its discretion
or an injustice appears to have been done.'' (Citations
omitted; internal quotations marks omitted.) State v.
Martin, 77 Conn. App. 818, 826, 827 A.2d 1 (2003).
The defendant claims that the court did not take
judicial notice of the cost of encapsulation over the cost
of demolition, but was simply explaining its reasons for
rejecting the appraisers' testimony regarding the cost
of removing the asbestos. The defendant argues that
‘‘[t]he court was stating that the cost of encapsulation
may have made demolishing the building not its highest
and best use because such high remediation and demolition
costs would be unnecessary by rehabilitating the
premises.'' We are not persuaded.

In reviewing the transcript, we did not find any testimonial
evidence concerning the cost of encapsulation
to support the defendant's claim. In fact, the court did
not allow the defendant to elicit testimony from Nitz
regarding the effect that the cost of encapsulation
would have on the value of the building.7 Without giving
notice to the parties, the court, in its memorandum of
decision, took judicial notice of the cost effectiveness
of encapsulating asbestos as opposed to removing it.
We have repeatedly stated that a ‘‘trial court must give
the parties an opportunity to be heard prior to taking
such notice.'' Federal Deposit Ins. Corp. v. Napert-
Boyer Partnership, supra, 40 Conn. App. 442. Under
these circumstances, ‘‘[l]ack of notice prevents a party
from disputing the judicially noticed fact.'' Id.

The cost of asbestos removal or encapsulation is not
a subject that one encounters in the ordinary course
of life. Whether it was more cost effective to encapsulate
the asbestos than to remove it is not a proper
subject matter of judicial notice. See id. (‘‘whether a
substituted interest rate is reasonable is not the proper
subject matter of judicial notice''). Accordingly, we conclude
that the court abused its discretion by taking
judicial notice of the cost effectiveness of encapsulating
asbestos as opposed to removing it without giving the
parties notice of its intention to do so.

II

The commissioner next claims that the court improperly
determined the fair market value of the condemned
property on the basis of a five year old municipal property
tax assessment. We agree.

The commissioner's claim involves the issue of valuation.
‘‘Valuation is a matter of fact to be determined by
the trier's independent judgment. . . . Because this is
a challenge to the court's finding of facts, we apply the
clearly erroneous standard of review. A finding of fact
is clearly erroneous when there is no evidence in the
record to support it . . . or when although there is
evidence to support it, the reviewing court on the entire
evidence is left with the definite and firm conviction
that a mistake has been committed.'' (Citation omitted;
internal quotation marks omitted.) New London v. Picinich,
76 Conn. App. 678, 685, 821 A.2d 782, cert. denied,
266 Conn. 901, 832 A.2d 64 (2003).

determining the value of a condemned property,
‘‘[t]he general rule . . . is that the proper measure of
damages is . . . the market value of the property as
improved, in view of all the uses to which it is adaptable
and available.'' (Internal quotation marks omitted.)
Connecticut Printers, Inc. v. Redevelopment Agency,
159 Conn. 407, 414, 270 A.2d 549 (1970). Essentially,
we apply the highest and best use approach in valuing
the property. ‘‘A property's highest and best use is commonly
accepted by real estate appraisers as the starting
point for the analysis of its true and actual value. . . .
[U]nder the general rule of property valuation, fair [market]
value, of necessity, regardless of the method of
valuation, takes into account the highest and best value
of the land. . . . A property's highest and best use is
commonly defined as the use that will most likely produce
the highest market value, greatest financial
return, or the most profit from the use of a particular
piece of real estate.'' (Citations omitted; emphasis in
original; internal quotation marks omitted.) United
Technologies Corp. v. East Windsor, 262 Conn. 11, 25,
807 A.2d 955 (2002).

The defendant argues that the court reasonably relied
on the evidence of the assessed value of the assessor's
calculations in determining the fair market value of the
property.8 That argument is misplaced. We recognize
that ‘‘[i]n determining fair market value, the trial court
is free to select the method of valuation most appropriate
to the case before it.'' D'Addario v. Commissioner
of Transportation, 180 Conn. 355, 365, 429 A.2d
890 (1980). That discretion, however, is not absolute.
Here, the court did not use the highest and best use
approach, or any alternative valuation method to calculate
the fair market value of the property. Instead, it
relied on the assessed value set forth on the assessor's
field card that was attached to one of the appraisal
reports to award the sum of $37,840. ‘‘It is almost everywhere
the law that the value placed upon a parcel of
land for the purposes of taxation by the assessors of
the town in which it is situated is no evidence of its
value for other than tax purposes.'' 5 P. Nichols, Eminent
Domain (3d Ed. Rev. 2003, J. Sackman ed.) § 22.1,
p. 22-1; see Connecticut Printers, Inc. v. Redevelopment
Agency of Hartford, supra, 159 Conn. 407. Moreover,
‘‘[i]t has been held . . . that the amount of taxes, as a
derivative of the assessed value, is . . . inadmissible
as evidence of value in eminent domain.'' 5 P. Nichols,
supra, pp. 22-18–22-19. Under the facts of this case, the
court improperly used the assessed value to calculate
the fair market value of the defendant's property.

The judgment is reversed and the case is remanded
for a new trial.

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