This is аn appeal by the plaintiff, State of Oregon, through its Highway Commission, from a judgment of the circuit court which decreed that upon the payment by the state to the defendant of $25,100 together with interest, costs and аttorney fees the real property which is the subject matter of tMs proceeding would be appropriated to the state. The latter sought the property for the improvement of a highway in Portland. The judgment was preceded by the return of a verdict in the defendant’s favor.
The state (plaintiff) in appealing submits four assignments of error. Their essence is thus stated in the state’s brief:
“The first question to be presentеd on tMs appeal is the court’s alleged error in overruling the plaintiff’s objection to the cross-examination of *64 plaintiff’s witness, H. Stepp, as to the amount for which comparable property hаd been offered for sale, (tr 115-116)
“The second question presented is the alleged error of the court in sustaining the objection of the defendant to the attempt by plaintiff’s witness, J. Holbrook, to break down and explain his opinion of the value of the defendant’s remaining land on direct examination, (tr 143-144)
“The third error complained of by plaintiff is the failure of the court to give plaintiff’s requested instruction No. XII, which referred to the future plans or intentions of the defendant for the development of its property. Exception was taken by the plaintiff to the court’s failure to give the requested instruction, (tr 197)
“Lastly, error is complained of for the failure of the court to give plaintiff’s requested instruction No. XIX, which referred to the change in the flow of traffic past the defendant’s property. Exception was taken to the court’s failure to give the requested instruction, (tr 197)”
The defendant owns a parcel of real property in Portland which consists of three-fourths of a block and which was improved in part with a warehouse and the defendant’s retail store. Bеfore the condemnation proceeding was instituted a disastrous fire destroyed the warehouse and a part of the retail establishment.
We will now consider the first assignment of error which presents the questiоn as to whether the circuit court erred when it permitted one of plaintiff’s witnesses, over plaintiff’s objection, to state on cross examination that comparable property had been offered for sale at the price of $80,000.
Oregon and other jurisdictions have held that offers to buy or sell comparable property are not admissible in evidence to establish the value of the land
*65
under condemnation. We take the following from
State of Oregon v. Cerruti,
“Over thе objection of the plaintiff, the court received in evidence the testimony of the witness, B. A. Kliks, an owner of land in the vicinity of the land being condemned, that a real estate man had made him an offer of $1600.00 fоr an acre and a half of his land. The ruling is assigned as error. The assignment must be sustained. It is well settled in this and other jurisdictions that offers of sale and purchase of similar land in the vicinity are inadmissible, for the reason, among others, that such evidence places before the court or jury an absent person’s declaration or opinion as to value, while depriving the adverse party of the benefit of cross-exаmination. Portland & O. C. Ry. Co. v. Ladd Estate Co.,79 Or 517 ,155 P. 1192 ; Hine v. Manhattan R. Co.,132 N.Y. 477 ,30 N.Y. 985 ; Davis v. The Charles River Branch Railroad Co.,65 Mass. 506 ; Helena Power Transmission Co. v. McLean,38 Mont. 388 ,99 P. 1061 ; Blincoe v. Choctaw O. & W. R. Co.,16 Okla. 286 ,83 P 903 , 4 L.R.A. (N.S.) 890; 18 Am. Jur., Eminent Domain, 996 §351; 2 Lewis on Eminent Domain, 1146, § 666. * *
Other cases have excluded offers to buy similar property.
Davis v. Charles River Branch Railroad Company,
65 Mass 506, and Annotation, 7 ALR2d 781, 785. Assuming arguendo that an offer to buy is distinguishable from an offer to sell there is ample precedent to exclude an offer to sell similar property as evidence of the value of the property in suit.
Atlantic Coast Line R. Co. v. United States,
132 F2d 959;
Metropolitan St. Ry. Co. v. Walsh,
*66 The textbook writers favor the exclusion of evidence of the kind just described. Its inadmissibility is attributed partly to the fact that offers to buy or sell represent at thе best the opinion of one party only, and partly to the difficulty of establishing their bona fide character. See Orgel, Valuation Under Eminent Domain, 2d ed, § 148. Nichols, Eminent Domain, 3rd ed, § 21.4 (3). Lewis, Eminent Domain, 3rd ed, § 666, states:
“Nor is it cоmpetent to prove offers for adjacent and similar property, or the price at which the owners of such property have offered it for sale.”
McCormick on Evidence, § 166, p 349, says:
“For prices on other lands to be admittеd, they must be sale prices, and not mere offers. These would often be of great significance, but the effort to determine their genuineness would lead to collateral disputes and waste of time at the triаl. However, if one of the parties to the present action has himself offered to buy or sell the land in question, or other similar neighboring land, evidence of this offer may be offered against (not for) him as an admission.”
We are satisfied that the first assignment of error possesses merit. We sustain it.
The second assignment of error is based, as we have seen, upon the trial judge’s refusal to permit one of the state’s expеrt witnesses to explain the manner in which he estimated the value of the part of defendant’s property which it would retain after the state had taken the fraction under condemnation. The state’s brief from which we will now copy gives the substance of the testimony excluded by this challenged ruling:
“It can be seen from the testimony offered and rejected by the court that the plaintiff’s expert, *67 Holbrook, propоsed to explain Ms opinion of the ‘after’ value of the defendant’s property by regarding the property as being split into three different quarter-block parcels. He was of the opiMon that a quarter block in this area would sell for as much after the taMng as before and that a quarter block would have the same value whether considered separately or as part of a block. In other wоrds, the witness predicated his opinion upon a belief that there was no plottage or assembly value to quarter blocks here. The thrust of his testimony, if allowed, would have been that after the taMng, Lots 3 and 4 could have been sold as a quarter block for exactly the same amount as their ‘before’ value when considered as part of the whole block, and this would also have been true as to Lots 7 and 8. In Holbrook’s opinion, Lots 1 and 2, from which an easement was acqmred in the tailing, would have been worth one-half as much as before the taMng and could have been sold for that amount to the owner of either of the remaining quarters, i.e., to the owner of the quarter block containing Lots 7 and 8 or to the owner of the quarter block containing Lots 3 and 4.”
According to Nichols, Eminent Domain, 3rd ed, § 18.42(1):
“Although there is authority to support the proposition that an оpinion witness, at least upon direct examination, need not state the reasons for Ms opinion, it is generally held that he should testify as to the facts which substantiate his conclusion and may explain the reаsons for Ms opinion.”
"Wigmore on Evidence, 3rd ed, § 562, states:
“An expert witness, like any other witness, may be asked on the direct examination, or may be required, to state the grounds of Ms opinion, i.e. the general data wMch forms the basis of Ms judgment upon the specific datа observed by him. This is merely an application of the general principle of the knowledge-qualification.”
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This court has recognized and employed the ride stated in those two authorities; see
L. B. Menefee Lumber Co. v. MacDonald et al,
“An expert’s estimate or guess as to how much nonexistent lots of a proposed subdivision will sell for is not, as we read the authorities, one of the circumstances thus to be taken into consideration * * *. The еvidence is speculative, no matter under what guise it is offered, and is not to be received at all because of its tendency to mislead the jury.”
See to like effect
State Highway Commission v. Bailey,
The property involved in this proceeding is situated in a business industrial part of the city of Portland. The expert, whose testimony is under analysis, did not propose to subdivide it in the manner envisioned by the owner in the Deal case. The owner proposed no change whatever for the property, but the witness desired to state that it could be sold as a whole or in parts. His testimony would not have imported into the case speculation or conjecture. He should have bеen permitted to give the basis of his opinion.
The third assignment of error complains because the trial judge did not instruct the jury:
“I instruct you that in determining the fair cash market value of the property sought to be aсquired, you are not to consider any intentions or plans that the defendant may have had for the future use or improvement of their property whatsoever.”
*69
We do not believe that that requested instructiоn is in harmony with
State Highway Commission v. Arnold et al,
The fourth, being the last assignment of error, is bаsed upon an instruction requested by the plaintiff but refused. Had it been given it would have told the jury in part:
“Therefore, in arriving at just compensation, you shall not consider what, if any, lessening of traffic over the existing highway by thе defendant’s remaining land may be caused by the construction or relocation of the main traveled highway over a new route.”
In seeking to sustain the requested instruction the plaintiff’s brief quotes from a part of the answer which alleges that the state, in rerouting the traffic, has caused such a large volume to move in front of the defendant’s premises that:
“* * * motor vehicles can neither enter nor leave the рortion of defendant’s property not taken * * * and has thus destroyed substantially all access from or to defendant’s property * * * no motor vehicles can be stopped along the curb in front of defendant’s property * *
Thus, an instruction that would have been pertinent was not one that dealt with a lessening of traffic but one that would have dealt with an increased flow of traffic. The state’s reply brief says:
“* * * it is contended no error occurred because the instruction requested used the word ‘lessening’ instead of ‘increasing.’ We admit the instruction would have been better had such a change been made. * *
*70 In view of the disсussion of the applicable principles of law that is set forth in the two sets of briefs, we do not believe that any trouble will occur in the framing of the instructions upon the retrail. This assignment of error affords no occasion for reversal.
We sustain assignments of error 1 and 2. The judgment of the circuit court is reversed and the cause remanded.