"market value is the highest price in terms of money which land will hring 

 when exposed for sale in the open market, with a reasonable time allowed 

 to find a purchaser, buying with a full knowledge of all uses and purposes, 

 to which it is adapted, and for which it is capable of being used."^ 



Appraisal Procedure of the Corps of Engineers 



Land appraisers were employed to make the basic evaluation of the reservoir 

 lands and other lands required by the projects, and to estimate the damages 

 caused by the taking of these lands from their private owners. After the 

 area was surveyed to establish the take-line, the basic appraisal was made 

 to provide evidence and expert opinion concerning the physical character- 

 istics and value of the land, the crops, the timber, and the buildings and 

 improvements. In the cases that involved severance, or the taking of only 

 a part of the property, an appraisal was made of the worth or market value 

 of the remaining property to an average user. The difference between the 

 market value of the established unit and that of the unit remaining after 

 the severance was considered to be the warranted purchase price, including 

 damages caused by the taking of part of the unit. 



With this background, the owner was contacted to determine his asking 

 or demand price. If the owner's price did not exceed the appraised value, 

 the purchase was negotiated at the owner's price. If the owner's price ex- 

 ceeded the appraisal value, the appraisal was reviewed with the owner to 

 determine the differences between the two evaluations. If the differences 

 were not great, or if the owner's evaluation included elements of value not 

 covered by the original appraisal — such as prospective mineral develop- 

 ment or anticipated development of camp sites — the case was referred 

 back to the appraiser for reappraisal. If the differences were great, a second 

 appraisal was made by a different government appraiser. In the event the 

 second appraisal was in substantial agreement with the owner's evaluation, 

 or if the owner was willing to accept it as the basis for settlement, the deal 

 was closed on that basis. 



If the second appraisal confirmed the first and the owner was still un- 

 willing to settle at approximately the appraisal value, a local appraiser was 

 employed to make a third appraisal. If the owner would not sell for approxi- 

 mately the highest of the three appraised values, the case was referred to 

 court for settlement. 



As a matter of general practice, the Corps accepted the owner's price, if 

 it did not exceed the appraisal value by more than 10 percent. This was 

 assumed to be the maximum cost that could be avoided by immediate 

 settlement. The cost clearly avoidable was the cost of another appraisal 

 until the third appraisal was made. After the third appraisal, the cost clearly 

 avoidable was that of court proceedings. 



Appraisal, Negotiation, and Settlement; Their Adequacy and Equity 



Appraisal reports were submitted in summary form so exact procedures 

 used by appraisers in arriving at evaluations of project properties are not 

 clear. However, land in each ownership unit was classified and valued on 

 the basis of judgment as to best apparent use. Improvements were listed, 



1 (10 Calif. Jur. Sec. 54, p. 338.) 



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