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United States of America v. Exclude Randy Tagg's

February 22, 2012

UNITED STATES OF AMERICA,
PLAINTIFF,
v.
EXCLUDE RANDY TAGG'S DEFENDANTS.



The opinion of the court was delivered by: Hon. Roger T. Benitez United States District Judge

ORDER:

(1) ADOPTING REPORT AND RECOMMENDATION, [Doc. No. 57];

(2) GRANTING MOTION TO EXCLUDE THE VALUATION TESTIMONY OF DAVID WICK, [Doc. No. 51];

(3) DENYING AS MOOT EX PARTE APPLICATION TO STRIKE DAVID WICK'S 242.93 ACRES OF LAND MORE OR LESS, VALUATION TESTIMONY, SITUATED IN SAN DIEGO COUNTY, STATE OF CALIFORNIA; KYDDLF & [Doc. No. 48]; and RDLFGFT #1, LLC; and INTERNATIONAL INDUSTRIAL PARK, INC., (3) DENYING MOTION TO VALUATION TESTIMONY, [Doc. No. 50].

Presently before the Court in this condemnation case are Plaintiff United States's Motion to Exclude the Valuation Testimony of David Wick, [Doc. No. 51], and Motion to Exclude Randy Tagg's Valuation Testimony, [Doc. No. 50]. Having considered the parties' arguments, and for the reasons set forth below, the Court GRANTS the motion to exclude the valuation testimony of Mr. Wick and DENIES the motion to exclude the valuation testimony of Mr. Tagg.

BACKGROUND

On May 25, 2010, the United States filed a Complaint in Condemnation and a Declaration of Taking, condemning a temporary right to enter, survey, and test 242.93 acres of land in Otay Mesa, California. The taking related to the possible future acquisition of a portion of the 242.93 acres, was to be limited to a period of twelve months, and was not meant to exclude the landowners from the property. Specifically, the property interest to be taken was described as follows:

The estate taken is a temporary, assignable easement beginning on the date possession is granted to the United States and ending 12 months later, consisting of the right of the United States, its agents, contractors, and assigns to enter in, on, over and across the land described in Schedule "C" to survey, make borings, and conduct other investigatory work for the purposes described in Schedule "B" and to access adjacent lands; including the right to trim or remove any vegetative or structural obstacles that interfere with said work; reserving to the landowners, their successors and assigns all right, title, and privileges as may be used and enjoyed without interfering with or abridging the rights hereby acquired; subject to minerals and rights appurtenant thereto, and to existing easements for public roads and highways, public utilities, railroads and pipelines. (Compl., Schedule "E" [Doc. No. 1].) Concurrently with the Complaint, the United States deposited $100.00 with the Clerk of Court as the estimated "just compensation" for the taking. [Doc. No. 3.] On June 2, 2010, this Court granted possession to the United States. [See Doc. No. 6.]

The case will shortly go to trial on the issue of just compensation.*fn1 Defendants intend to offer valuation testimony of David Wick, the property manager of the properties owned by Defendants in this action, and Randy Tagg, a real estate appraiser retained to appraise the value of the condemned easement. Presently before the Court are the United States's motions to exclude both valuation testimonies. The United States previously attempted to strike the testimony of Mr. Wick, arguing that he was not properly disclosed as an expert witness. [See Doc. No. 35.] On October 24, 2011, Magistrate Judge Cathy Ann Bencivengo denied the motion to strike, concluding that although Mr. Wick could not testify as an expert witness, it was unclear whether as the owner or property manager of the lands in question, he could provide a lay opinion as to the value of the property interest taken under Federal Rule of Evidence ("FRE") 701. [Doc. No. 42.] Judge Bencivengo ordered that Mr. Wick be made available for a second deposition, limited to his valuation opinion and his foundation for that opinion. [Id.] The second deposition of Mr. Wick was taken on November 2, 2011.

The United States then filed motions before both Judge Bencivengo and the undersigned to exclude Mr. Wick's valuation testimony. [Doc. Nos. 48, 51.] On December 2, 2011, Judge Bencivengo issued a Report and Recommendation, recommending that Mr. Wick be precluded from providing opinion testimony regarding the market value of the condemned property. [Doc. No. 57.] The United States also filed a motion before the undersigned to exclude the valuation testimony of Mr. Tagg. [Doc. No. 50.] Defendants filed oppositions to each motion, and the United States replied. The Court decides both motions before it without a hearing pursuant to Civil Local Rule 7.1(d)(1).

DISCUSSION

I. Valuation testimony of Mr. Wick

The United States moves to exclude the valuation testimony of Mr. Wick because Defendants failed to properly disclose him as an expert as required by Federal Rule of Civil Procedure 26(a) and the scheduling order in this case, and because his valuation opinion exceeds lay opinion testimony allowed under FRE 701. In response, Defendants contend that, as the property manager for Defendants, Mr. Wick may properly testify as to the value of the condemned property under FRE 701. Mr. Wick's proposed testimony is that, based on his position as the property manager and the negotiations of numerous similar transactions over his 30-year career, the fair market value he would have asked for the condemned easement is $739,200. (See Wick Decl. ¶ 4 [Doc. No. 58-1].)

FRE 701 provides that a witness not testifying as an expert may provide testimony in the form of an opinion as long as it is: (a) "rationally based on the witness's perception," (b) "helpful to clearly understanding the witness's testimony or to determining a fact in issue," and (c) "not based on scientific, technical, or other specialized knowledge within the scope of Rule 702." The Advisory Committee Note to the 2000 Amendments to FRE 701 specifies that "most courts have permitted the owner or officer of a business to testify to the value or projected profits of the business, without the necessity of qualifying the witness as an accountant, appraiser, or similar expert." However, to be admissible under FRE 701, the owner's or officer's lay opinion as to the value of the property must be based on that witness's "particularized knowledge" as a result of his position, and not on "experience, training or specialized knowledge within the realm of an expert." FRE 701, Advisory Committee Note to 2000 Amendments; see also Fourth Investment LP v. United States, No. 08cv110-BTM (BLM), 2011 WL 227564, at **1-2 & n.1 (S.D. Cal. Jan. 21, 2011) (admitting an owner's valuation opinion under FRE 701 because it was based on the particularized knowledge and "substantial personal familiarity" with the ...


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