Phh Investments v. Department of Transportation
808 S.E.2d 431
Ga. Ct. App.2017Background
- Parcel 6 (strip mall anchored by Kroger) is owned by E&A; Parcel 5 (corner lot with a Wendy’s) is contiguous and owned by PHH, leased to Zenith.
- Parcel 5 originally had no direct highway access; PHH acquired easements over Parcel 6 (Big Horn Drive) to reach Highways 400 and 53.
- DOT condemned portions of Parcel 6 as part of a continuous-flow intersection project, including areas containing PHH/Zenith’s access easements; no part of Parcel 5 was condemned.
- The project eliminated direct access from Highway 400 to Parcel 5 and altered access/egress routes, which Defendants say diminishes Parcel 5’s value and business viability.
- Trial court granted partial summary judgment for DOT, precluding recovery of consequential damages for diminution in value of Parcel 5 in the condemnation action; Defendants appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a non‑condemned, contiguous property owner may recover consequential damages for diminution in value to that property in the condemnor’s action against the adjoining parcel | DOT: consequential damages in condemnation are limited to the remainder of the condemned tract; neighboring-owner damages are not recoverable in that condemnation action | PHH/Zenith: loss of easements over Parcel 6 caused diminution in Parcel 5’s value and should be recoverable as consequential damages in this condemnation | Held: Non‑condemned contiguous owner cannot recover consequential damages to its separate parcel in the condemnor’s action; such damages must be pursued separately (inverse condemnation) |
| Scope of recoverable damages in the condemnation action | DOT: damages limited to taken portion and diminution to the remainder of the condemned parcel (Parcel 6) and to any remaining easement interests | PHH/Zenith: also entitled to damages reflecting diminished value of Parcel 5 | Held: Recovery in this action is limited to (a) market value of taken easement portions and (b) diminution, if any, to PHH’s easements within Parcel 6; diminution in value of Parcel 5 is not recoverable here |
Key Cases Cited
- Georgia Power v. Bray, 232 Ga. 558 (1974) (neighboring owner’s consequential damages to a separately owned contiguous tract cannot be asserted in the condemnation action; only damages to the remainder of the condemned tract are recoverable)
- Simon v. Dept. of Transp., 245 Ga. 478 (1980) (damages to uncondemned property caused by condemnation of neighbor’s property must be sought in a separate action)
- Dept. of Transp. v. Whitehead, 253 Ga. 150 (1984) (measure of consequential damages for interference with access is diminution in market value of the property)
- Dougherty County v. Hornsby, 213 Ga. 114 (1957) (easement of access is a property right requiring compensation when appropriated)