KENFORD CO. INC. V. COUNTY OF ERIE, 73 N.Y.2d 312 (1989) CASE BRIEF

KENFORD CO. INC. V. COUNTY OF ERIE

73 N.Y.2d 312 (1989)

NATURE OF THE CASE: This was an appeal and court case that would never end; spanning over 18 years of litigation. Erie (D) challenged a judgment which affirmed a judgment in favor of Kenford (P), corporate landowner, wherein it was awarded damages for loss of anticipated profits from appreciation of the value of its land.

FACTS: This was a breach of contract action involving the proposed construction and operation of a domed stadium in the County of Erie (D). Enabling legislation was passed by D to build a domed stadium in the vicinity of Buffalo. Kenford (P) submitted an offer to donate land to D upon which to build the stadium if D would allow Dome Stadium, Inc. (P1) to lease or manage the stadium. P's offer was adopted. P then exercised several options on parcels of land located in Lancaster. The contract was entered into and signed and P was to donate 178 acres of land and the stadium was to be started within 12 months and a 40-year lease was negotiated with P1 for the operation of the facility under which D would get at least $63.75 million in lease revenue. This was to come from increased property taxes against the peripheral lands that P had purchased. If P1 and D could not agree on lease terms P1 and D were to enter into a 20-year management agreement. D eventually learned that the project would cost $72 million which was $22 million in excess of its bond resolution and then it terminated its contract and P and P1 sued for specific performance or contract damages. P got an award of $18 million for lost appreciation in its property on the periphery and $6 million for out of pocket expenses. P1 was awarded $25.6 million in lost profits under the parties 20-year management contract. The appeals court affirmed the $6 million but reversed the P1 lost profits and a portion of P's out of pocket expenses and directed a new trial on the damage award for loss of anticipated appreciation in the value of the peripheral lands; that on the latter such loss was foreseeable and a certain damage. On retrial for P the jury awarded $6.5 million. The Appellate Division affirmed and D appealed.

ISSUE:

RULE OF LAW:

HOLDING AND DECISION:

LEGAL ANALYSIS:

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