In MDOT v Haggerty Corridor Partners, _____ Mich _____(2005), the Michigan Supreme Court considered “whether the trial court properly allowed defendants to present, in support of their proffered calculation of just compensation, evidence that their property had been rezoned from residential to commercial after the taking.” The Court upheld the Court of Appeals ruling that the trial court abused its discretion in allowing evidence that the property at issue was rezoned after the taking.
In that case, the Michigan Department of Transportation condemned 51 acres of the defendants' property for the Haggerty Connector (M-5). On the date of taking , the property was zoned for single-family homes and agricultural uses. The property owners contended that the highest and best use of the property was commercial. MDOT argued that at the time of taking, the property was not likely to be rezoned for commercial use. The property owners' appraiser testified that approximately one and a half years after the taking, the property was rezoned to permit office/service/technology uses. The trial court denied MDOT's motion to exclude evidence of the after taking rezoning, while refusing to grant MDOT's alternative request to present evidence that the rezoning took place solely as a result of the taking (which would be inadmissible under MCL 213.70).
In ruling that the post-taking evidence was inadmissible, the Court articulated that the holding was not inconsistent with State Hwy Comm'r v Eilender , 362 Mich 697 (1961), which stands for the proposition that a party may introduce evidence of the reasonable possibility that absent the taking a variance (or rezoning) would have occurred. Essentially the Court ruled that while the property owners were free to argue that the rezoning would have occurred, they may not use after taking evidence, which would have been unavailable to market participants determining the price on the date of taking. The Court also ruled that “the trial court sorely compounded the error by refusing to allow MDOT to rebut the posttaking evidence by demonstrating that the rezoning was directly attributable to the condemnation itself.” Of course, the second error effectively is mooted by the fact that the evidence should never have been introduced in the first place.