Uniform standards not applicable to appraisal in condemnation proceedings.(Recent Court Decisions)

When the eminent domain statute requires only that condemnors use "generally accepted appraisal practices," such appraisals need not satisfy the Uniform Standards of Professional Appraisal Practice (USPAP), according to the Missouri Court of Appeals.

In 2004, Kansas City began redeveloping a portion of the city's downtown and included property owned by Chung Ho Ku and Myong Suk Ku in the redevelopment area. The city offered the Kus $390,500 for the property and provided them with an appraisal in that amount made by a Missouri licensed appraiser. The Kus responded with a counteroffer of $2,000,000, which the city rejected. In furtherance of the redevelopment project, the city declared the area blighted and condemned the Kus' property in 2007.

At trial, the Kus disputed the blight findings and claimed that the city failed to negotiate in good faith before resorting to eminent domain, as required by statute. Under the applicable redevelopment statute, the condemnor is deemed to have satisfied its duty to negotiate in good faith if its offer "was no lower than the amount reflected in an appraisal performed by a state-licensed or state-certified appraiser." The Kus argued that although their appraiser was state-licensed, the city did not comply with the statute because the appraisal did not meet six standards of USPAP. The trial court ruled in favor of the city and granted the condemnation order. The Kus appealed.

On appeal, the Kus argued primarily that because the city's appraiser did not adhere to USPAP, the city's resulting offer was not made in good faith. In support of this argument, the Kus cited the statute governing real estate appraisers generally, which requires state-licensed appraisers to comply with USPAP. The appellate court found that the general appraisal statute was not controlling and was in conflict with a section of the redevelopment statute. The conflicting section cited by the court requires appraisals in condemnation proceedings to comply only with "generally accepted appraisal practices."

According to the court, when two statutes addressing the same subject matter are in conflict, the more specific statute will govern. The court held that here, where the redevelopment statute deals specifically with condemnation proceedings, it controls over the statute applicable to appraisers generally. The court noted that the Kus conceded that the city's appraisal complied with generally accepted practices and thus concluded that the city's offer was made in good faith in compliance with the redevelopment statute. The trial court decision was affirmed.

City of Kansas City v. Chung Hoe Ku

Missouri Court of Appeals

February 17, 2009

2009 WL 365299 (Mo. Ct. App. 2009)

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