Condemnation and substituted parties: HUNSAKER V. COM. (SC 11/21/2007)

HUNSAKER V. COM.
CONDEMNATION:  REPAYMENT AND SUBSTITUTE PARTIES’ OBLIGATION

2005-SC-000974-DG.pdf
PUBLISHED: AFFIRMING
OPINION BY SCHRODER; SCOTT DISSENTS BY SEP. OP.
DATE RENDERED: 11/21/2007

A condemnation action was brought against Mildred Hunsaker. The trial court entered an interlocutory order granting possession to the Commonwealth and setting the property value at $657,782.50. Due to the court order, Ms. Hunsaker was able to withdraw this amount paid to the court, which she did. The Commonwealth filed exceptions to the Commissioner’s report, claiming the evaluation was excessive.

Five to six years later, after Ms. Hunsaker had conveyed her interest in the property to her daughters and had died, the daughters were substituted for Ms. Hunsaker in the action by agreed order. At trial, the jury set the value of the property at $300,000. The court’s judgment required the daughters to pay the Commonwealth the excess that Ms. Hunsaker had received, plus interest. On appeal, the daughters argued that they should not be required to pay because they had not received any of the money Ms. Hunsaker had gotten. The court of appeals held that the daughters were liable for the money because, as a general rule “when a party is substituted for another party, he takes up the litigation with all of its benefits and with all of its burdens just where the predecessor dropped it.”

The Supreme Court agreed and affirmed, holding that the daughters chose to intervene, were the real parties in interest, and must be subject to the burdens as well as the benefits of that status.

In a strong dissent, Justice Scott argued that under the condemnation statutes, compensation can only be paid to the person who owned the property at the time of the taking. Thus, he argued, it was only Ms. Hunsaker who was entitled to the money and was obligated to pay back the excess she had received. Justice Scott stated that while it is true that the substituted party must stand in the shoes of the party for whom he substituted, “he is not, however, obligated for the debts and liabilities of his parties’ predecessor, except as otherwise provided by law.” Justice Scott would have reversed and sent the case back to the circuit court to determine the extent to which the judgment exceeded the value of the property the daughters received, because the value of what they received is the only amount for which the daughters should be liable.

By Sam Hinkle

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