City of Moorhead v. Red River Valley Cooperative Power Ass'n
811 N.W.2d 151
Minn. Ct. App.2012Background
- City condemned into Americana Estates within Red River's service territory to acquire right to serve 63 customers; Americana Estates was annexed into the city in 2006.
- Damages under Minn. Stat. § 216B.47 must include original cost, depreciation, lost revenue, integration expenses, and other appropriate factors.
- District court ruled fair market value is not the proper damages measure under § 216B.47 and excluded fair-market-value evidence and related expert testimony.
- Jury was instructed only on four enumerated factors; damages for loss of revenue were disputed.
- Red River offered a net-revenue-loss method; City’s expert urged a traditional valuation approach but was excluded from trial; jury awarded $339,865 for loss of revenue, totaling $385,311 including stipulated items.
- Appeal followed challenging the statutory damages framework, evidentiary rulings, and sufficiency of the verdict.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether fair market value is the proper damages measure under § 216B.47 | City argues FMV should apply | Red River contends FMV excluded by statute | FMV not proper; § 216B.47 requires four enumerated factors only |
| Whether the district court abused its discretion in excluding the expert report | City contends untimely, relevant evidence; discovery issue | Red River asserts prejudice and deadline violations | Court did not abuse discretion; exclusion proper due to untimely submission and prejudice |
| Whether the jury’s special verdict is supported by the evidence | City asserts damages misaligned with expenses and power costs | Red River reliance on expert's calculation supports verdict | Special verdict supported by the record; not contrary to evidence |
Key Cases Cited
- State by Humphrey v. Strom, 493 N.W.2d 554 (Minn. 1992) (measure of damages for partial takings; fair market value context cited)
- City of Rochester v. People’s Coop. Power Ass’n, 483 N.W.2d 477 (Minn. 1992) (two procedures under § 216B.44 vs § 216B.47; primary jurisdiction discussed)
- In re Grand Rapids Pub. Utils. Comm’n, 731 N.W.2d 866 (Minn.App. 2007) (net-loss-revenue method adopted for damages)
- In re City of Redwood Falls, 756 N.W.2d 133 (Minn.App. 2008) (MPUC application of § 216B.44 factors; net-loss-revenue method noted)
- In re Annexation of Portion of Serv. Territory of People’s Coop. Power Ass’n, 470 N.W.2d 525 (Minn.App. 1991) (annexation/utility service area damages context)