City of Albuquerque v. Tecolote Res., Inc.

544 P.3d 321

2024-NMCA-029

CITY OF ALBUQUERQUE, a New Mexico municipal corporation, Plaintiff-Appellant,

v.TECOLOTE RESOURCES, INC.; Kelly’s Legacy, LLC; Sheri I. Bovino, Trustee of The Burden Children’s Trust Dated December 17, 1986; Tecolote X-Kmartii, LLC; Bokf, Na d/b/a Bank of Albuquerque; County of Bernalillo; New Mexico Taxation & Revenue Department; and Unknown Owners or Claimants of the Property Involved, Defendants-Appellees.

No. A-1-CA-39674

Court of Appeals of New Mexico.

Filing Date: December 28, 2023

APPEAL FROM THE DISTRICT COURT OF BERNALILLO COUNTY, Erin B. O’Connell, District Court Judge

Stiff, Garcia & Associates, LLC, John 8. Stiff, Edward F. Snow, Albuquerque, NM, Esteban A, Aguilar Jr., City Attorney, John DuBois, Assistant City Attorney, Adam P. Leuschel, Assistant City Attorney, Albuquerque, NM, for Appellant

Stelzner, Winter, Warburton, Flores & Dawes, P.A., Dari Gershon, Albuquerque, NM, for Appellees

OPINION

IVES, Judge.

{1} In this partial takings case, the City of Albuquerque appeals from a judgment entered by the district court based on a jury verdict of $712,000 as just compensation for the City’s taking of part of a lot owned by Tecolote Resources, Incorporated. See N.M. Const. art. II, § 20 ("Private property shall not be taken or damaged for public use without just compensation."). The verdict included a stipulated amount of $69,350 to compensate Tecolote for the value of the land taken, plus an additional amount to compensate Tecolote for impairment of its access to the part of the lot that remained Tecolote’s after the taking. Whether Tecolote should be compensated for impaired access has been the key issue throughout this litigation, and on appeal the City raises three claims of instructional error related to that issue. Specifically, the City contends that (1) the jury was not properly instructed regarding the causal connection between the taking and the claimed damages; (2) the jury should have received an instruction based on UJI 13-719 NMRA because New Mexico law only allows damages for impaired access caused by a partial taking if the impairment is unreasonable; and (3) the jury should have been instructed on Tecolote’s duty to mitigate its damages to its right of access. As to the first claim of error, we conclude that the City has failed to demonstrate that the given instructions did not adequately convey the law regarding causation. As to the second claim of error, we conclude that the City was not entitled to an instruction based on UJI 13-719 because, in partial takings cases, neither NMSA 1978, Section 42A-1-26 (1981) nor New Mexico precedent require the owner to prove that the resulting access to their remaining property is unreasonable. Finally, as to the third claim of error, we conclude that the pretrial order—which did not include the City’s mitigation of damages defense—controlled the scope of the trial, and that the City did not preserve its argument that the district court should have amended the pleadings pursuant to Rule 1-015(B) NMRA. We therefore affirm.

BACKGROUND

{2} Tecolote owns property, West Central Plaza, located on the southwest corner of Central Avenue and Atrisco Drive in Albuquerque, New Mexico. Exercising the power of eminent domain, the City initiated a condemnation proceeding to aid in its construction of the Albuquerque Rapid Transit system (ART) and eventually took a 5,279 square-foot strip of Tecolote’s property along Central Avenue. The parties agreed that the fair market value of the taken land was $69,350. Tecolote sought an additional $2,931,454 to compensate Tecolote for impairment of access to its remaining property.

{3} At trial, Tecolote presented evidence that before, the taking, Tecolote’s property had several access points through which people who were traveling both east and west on Central Avenue could enter and exit. After the taking and in constructing ART, the City built a median on Central Avenue that prevented left turns into and out of the property, as well as a new signalized intersection with a left turn into a Long John Silver’s that borders Tecolote’s property. However, it was undisputed that access from Tecolote’s property to and from the light was not possible because Tecolote developed a new drainage system for its parking lot, which it placed between the two properties and landscaped over.

{4} Each party’s appraiser testified that they considered the changes in access when calculating the difference between the fair market value of the entire property before the taking and the fair market value of the remaining property after the taking. The appraisers disagreed about whether the changed access affected the value; the City’s appraiser testified that it did not, while Tecolote’s appraiser testified that it did.

{5} With, respect to the measure of damages, including any damages based on changed access, the district court gave the jury instructions based on several uniform instructions adopted by our Supreme Court: UJIs 13-704, 13-705, and 13-722 NMRA. The City requested—and the district court refused—three additional jury, instructions at, issue in this appeal.

{6} The jury awarded Tecolote a total of $712,000 to compensate it for the agreed upon value of the taken land and for impairment of access to its remaining land. The district court denied the City’s motion for a new trial, which was based on its theory that UJI 13-719 should have been given. The City appeals.

DISCUSSION

I. The City Has Not Demonstrated That the District Court Erred by Refusing the City’s Requested Instruction Regarding Causation or That Any Such Error Was Prejudicial

{7} The City argues that the district court erred by refusing to give the following causation instruction, based on City of Albuquerque v. Westland Development Co., 1995-NMCA-136, 121 N.M. 144, 909 P.2d 25:

An owner is entitled to compensation to for [sic] the loss in value of its remaining land caused by the taking of the condemned property and the use of the taken portion An owner is not entitled to compensation for any reduction in the value of the uncondemned portion of its parcel resulting from the use of the land not acquired from the owner by condemnation.

(Emphases added.) We are not persuaded. For the following reasons, we hold that the jury instructions given by the district court, which were based on uniform instructions adopted by our Supreme Court, sufficed to adequately convey New Mexico law regarding causation in partial takings cases, and that the City has failed to establish that the district court’s refusal of the City’s requested instruction warrants reversal.

[1–3] {8} We review the district court’s refusal to give a proffered jury instruction de novo. Benavidez v. City of Gallup, 2007-NMSC-026, ¶ 19, 141 N.M. 808, 161 P.3d 853. This de novo standard of review includes two fundamental concepts that drive our analysis here. First, if the given instructions "considered as a whole, fairly present the issues and the law applicable thereto, they are sufficient," and "[d]enial of a requested instruction is not error." Sandoval v. Gurley Properties Ltd., 2022-NMCA-004, ¶ 11, 503 P.3d 410 (internal quotation marks and citation omitted). Second, not every instructional error warrants reversal; only prejudicial errors do. See Benavidez, 2007-NMSC-026, ¶ 19, 141 N.M. 808, 161 P.3d 853. Because the burden is on the City, as the appellant, to "clearly demonstrate that the district court erred," Corona v. Corona, 2014-NMCA-071, ¶ 26, 329 P.3d 701, the City must show, that (1) the given instructions did not fairly present the issues and applicable law and that it was therefore error for the district court to refuse to give the instruction requested by the City, and (2) the refusal of the requested instruction was prejudicial.

{9} We conclude that the City has not carried its burden to demonstrate error or prejudice. In sum, as to error, we believe that the given jury instructions required Tecolote to prove that its damages were caused by the partial taking, and the City has not explained why the given instructions failed to adequately convey the causation requirement to the jury such that it was necessary to also give the supplemental causation instruction requested by the City. As to prejudice, even if we were to assume that the district court erred by refusing to give the requested instruction, we do not believe that the City has demonstrated that the absence of the instruction had any impact on the City’s ability to present its case to the jury. We discuss error and prejudice in turn.

A. The District Court Gave Uniform Jury Instructions That Conveyed the Causation Requirement, and the City Has Failed to Establish That the Refusal of Its Supplemental Causation Instruction Was Error

[4–6] {10} The City is correct that, under New Mexico law, "just compensation," N.M. Const. art. II, § 20, is limited to damages caused by the taking. Our Supreme Court has defined "just compensation" generally as "an amount sufficient to cover [the owner’s] loss—that is, to make [them] whole and fully indemnify [them]." Primetime Hosp., Inc. v. City of Albuquerque, 2009-NMSC-011; ¶ 15, 146 N.M. 1, 206 P.3d 112 (internal quotation marks and citation omitted). How to measure the owner’s loss depends on the nature of the taking. See id. When, as in this case, the taking is partial—i.e., when the government only takes part of the owner’s parcel—damages are measured using the "before and after rule," Westland, 1995-NMCA-136, ¶ 4, 121 N.M. 144, 909 P.2d 25, which is codified in Section 42A-1-26.¹ See State ex rel. State Highway Comm’n v. Hesselden Inv. Co., 1972-NMSC-071, ¶ 4, 84 N.M. 424, 504 P.2d 634, overruled on other grounds by Cnty. of Doha Ana ex rel. Bd. of Cnty. Comm’rs v. Bennett, 1994-NMSC-005, ¶ 4, 116 N.M. 778, 867 P.2d 1160. The statute explicitly requires a causal connection between the taking and the damages: "[T]he measure of compensation and damages resulting from the taking ...