Development Firm Wins ‘Taking’ Damages

A Los Angeles County Superior Court jury awarded Irvine-based Sanderson J. Ray Development Co. $17.7 million to compensate for the condemnation, or “taking,” of one of its commercial properties by a railroad. Atchison Topeka & Santa Fe Railway Co. had condemned Sanderson’s 32-acre site immediately after the development firm purchased it from manufacturer Lever Bros. Co. in 1995. The railroad has since converted the property, which fronts the Santa Ana Freeway in the city of Commerce, to a repair yard. Sanderson’s plan was to convert the site for retail and warehouse use. Before it could draw up plans, AT&SF; began lobbying to purchase the entire property for $14 million, Sanderson said. When the deal fell apart and part of the property was sold to another firm, the railroad filed condemnation proceedings and gave Sanderson $8 million for the property. No hearings were held on the matter. “That was such an absurd number that we went to court to have the amount upped,” Sanderson said. After a three-week trial, a jury found last week that the railroad had not paid the plaintiff enough for the property. An attorney for the railroad, Ben Salvaty of Los Angeles, said the price was low because valuable sewer credits had been transferred from the property and it was judged to have an industrial, rather than commercial, use.