Demand/Offer Consideration Not Limited To First Exchange Battle And Amount Of Compensation Actually Fixed Can Be The Beacon For Litigation Expense Decision In Bifurcated Trial—Bottom Line Is That Exchanges On Continued Trial Date Geared To Final Compensation Fix Can Be Used For Litigation Expense Determination In Bifurcated Trial Context.
People ex rel. CALTRANS v. Hansen’s Truck Stop, Inc., Case No. A133252 (1st Dist., Div. 4 Apr. 24, 2015) (published) is a very important addition to the jurisprudence under the eminent domain CCP § 1250.410 litigation expense scheme by which property owners can obtain attorney’s fees and court costs for winning the battle in these generally hard-fought cases.
First, the facts. This was a bifurcated “trial,” with phase one being whether property owner had a right to pursue damages for access impairment/goodwill loss and with phase two being what amount should be awarded in compensation for these components. As can be expected, various procedural things occurred in these complicated proceedings. Property owner initially demanded $5 million, with the State initially offering $784,000—with the trial judge determining that property owner had entitlement to pursue damages, but the amount of compensation to be fixed in phase two. Then, in phase two, property owner sent an amended demand for $2.99 million, but the State sticking to its original $784,000 offer. The jury came in at $2.5 million in favor of property owner, 85% of the amended $ 2.99 million demand. However, the trial court denied litigation expenses under the eminent domain scheme, based on the notion that they could not be justified via the initial $5 million demand by property owner.
Second, the law. The appellate court reversed based on its interpretation that the trial judge should have some flexibility in gauging statutory exchanges, especially where these issues are bifurcated, trifurcated, or even subject to more procedurally based nuances. The demand/offer sequence can be calibrated to the continued trial dates, that was the initial ruling on appeal. However, the critical question focused on what happens in a bifurcated trial as far as demand/offer—particularly the statutory language of “trial on issues relating to compensation” for CCP § 1250.410 purposes—does it run from the damages entitlement phase (phase one) or the compensation fixing phase (phase two). Phase two won out, with the appellate court making an analogy to CCP § 998 multiple offers and with a note to the Legislature to maybe make the result more clear given less than clear language in section 1250.410.
End result: Litigation expense denial reversed, with the trial judge given flexibility to gauge demand/offers, in bifurcated proceedings, at a much later point in time than when the first demands/offers were made.
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