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					                    Non-Jury Trial Before Judge William A. Parsons      1691


 1         IN THE CIRCUIT COURT, SEVENTH JUDICIAL CIRCUIT,
                 IN AND FOR VOLUSIA COUNTY, FLORIDA
 2                  CASE NUMBER: 2010-31696-CICI
                    DIVISION: 32 (Judge Parsons)
 3

 4

 5   PACETTA, LLC, a Florida
     limited liability company; DOWN
 6   THE HATCH, INC., a Florida
     corporation; and MAR-TIM, INC.,
 7   a Florida corporation,

 8
              Plaintiffs,                            NON-JURY TRIAL
 9
     vs.                                              VOLUME XIV
10                                                (Pages 1691 - 1874)

11   THE TOWN OF PONCE INLET, a Florida
     municipality,
12

13            Defendant.

14

15                    TRANSCRIPT OF PROCEEDING
               BEFORE THE HONORABLE WILLIAM A. PARSONS
16

17

18   DATE:                 Wednesday, February 15, 2012

19   TIME:                 1:15 p.m. until 5:04 p.m.

20   PLACE:                Volusia County Courthouse Annex
                           125 East Orange Avenue
21                         Daytona Beach, Florida

22   REPORTED BY:          LISA L. TAYLOR, RPR, FPR,
                           Court Reporter and Notary Public
23

24

25

                Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons   1692


 1   APPEARANCES:

 2             PETER B. HEEBNER, ESQUIRE
               JOHN N. UPCHURCH, ESQUIRE
 3             Heebner, Baggett, Upchurch & Garthe, P.I.
               523 North Halifax Avenue
 4             Daytona Beach, Florida 32118
               (386) 255-1428
 5             pheebner@lawdaytona.com

 6
               On Behalf of the Plaintiffs
 7

 8
               CLIFFORD B. SHEPARD, ESQUIRE
 9             Shepard, Smith & Cassady, P.A.
               2300 Maitland Center Parkway, Suite 100
10             Maitland, Florida 32751
               (407) 622-1772
11             cshepard@shepardfirm.com

12
               On Behalf of the Defendant
13

14
               NOAH C. McKINNON, JR., ESQUIRE
15             Korey, Sweet, McKinnon & Simpson
               595 West Granada Boulevard, Suite A
16             Ormond Beach, Florida 32174
               (386) 677-3431
17             nmckinnon@mckinnonandmckinnonpa.com

18
               Co-Counsel on Behalf of the Defendant
19

20

21             Others as may appear in the transcript.

22

23

24

25

               Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons     1693


 1                          VOLUME TRIAL INDEX

 2                          VOLUME XIV
                  (Wednesday, February 15, 2012)
 3

 4   TESTIMONY OF PAUL ALAN MOMBERGER (Continued)

 5        Cross-Examination (Continued) by Mr. Shepard              1694
          Redirect Examination by Mr. Heebner                       1717
 6        Recross-Examination by Mr. Shepard                        1720

 7   TESTIMONY OF H. LINWOOD GILBERT, JR., MAI

 8        Direct Examination by Mr. Heebner                         1722
          Voir Dire Examination by Mr. Shepard                      1733
 9        Direct Examination (Continued) by Mr. Heebner             1734
          Cross-Examination by Mr. Shepard                          1743
10        Redirect Examination by Mr. Heebner                       1753
          Recross-Examination by Mr. Shepard                        1754
11
     TESTIMONY OF PAUL M. ROPER, MAI, SRA
12
          Direct Examination by Mr. Heebner                         1766
13        Cross-Examination by Mr. Mr. Shepard                      1792
          Redirect Examination by Mr. Heebner                       1816
14
     TESTIMONY OF NANCY ELAINE EPPS
15
          Direct Examination by Mr. Heebner                         1830
16        Cross-Examination by Mr. Shepard                          1855

17

18

19

20

21

22

23

24

25

               Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons       1694


 1                        P R O C E E D I N G S

 2             (Whereupon, Court resumed from a luncheon

 3   recess at 1:15 p.m., and the following proceedings were

 4   held:)

 5             THE COURT:         You may proceed.

 6                 CROSS-EXAMINATION (Continued)

 7   BY MR. SHEPARD:

 8        Q    Mr. Momberger, when we last left -- excuse me,

 9   I have a frog in my throat this afternoon -- we were

10   talking about overlay districts.                   And I want to

11   specifically talk for a minute, before I move on, about

12   the overlay district in place in Ponce Inlet.

13             Not what was in the Comp Plan of 2010, which is

14   not enacted, we've already established that, it was never

15   applied to the property, but the actual ROD and the LUDCs

16   that has always applied to the property since before they

17   were ever purchased.         So that's -- just as a point of

18   reference, that's the ROD I'm speaking of.

19             You didn't have any problem with the planning

20   goals, objections [sic] or vision that are expressed in

21   that document, did you?

22        A    Any problem with them?

23        Q    Yeah.

24        A    With the -- which goals, which -- which are we

25   talking about?

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons                   1695


 1        Q    Preserving the area of the Town that the Town

 2   deems to be special or historic or scenic in terms of

 3   significance, those are legitimate planning goals?

 4        A    Yes.

 5        Q    Okay.        Your only issue was it -- with it was

 6   the restriction on dry boat storage facilities; that was

 7   the issue?     But the other stuff, you were prepared to

 8   work with all that?

 9        A    We were prepared to work with all of it.

10        Q    Okay.        And so I want to be clear here, too, so

11   we're on the same page, the restriction in the ROD is not

12   as to dry boat storage; it is to dry boat storage

13   facilities, correct?

14        A    I don't understand the distinction.

15        Q    Okay.        Well, if we -- I mean, we've had slides

16   but I'm going to try to make it quicker.                          I can go back

17   to it, but I think you'll be on the same page with me.

18             Because what I think we've discussed in your

19   deposition, for example, adult toy storage, a place where

20   you can go and rent a spot and park a boat on a trailer

21   on a monthly basis --

22        A    Okay.

23        Q    -- or a weekly basis; you understand that?

24        A    Yes.

25        Q    And you've certainly seen a slip allocation

                  Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons             1696


 1   ordinance?

 2        A     Yes, I have.

 3        Q     And that's how slips are defined, correct?

 4   It's a boat parked on dry land, not in a building

 5   anywhere; isn't that correct?

 6        A     I think it could apply to either.

 7        Q     Well, sure, it could.                    I mean, but the point

 8   is, the ordinance itself allotting slips has nothing to

 9   do with buildings, does it?

10        A     I don't think it's specific.

11        Q     Okay.       Did you ever submit a plan to the Town

12   for dry boat storage, as I've defined it and we've agreed

13   on, which is parking the boat on a trailer or some sort

14   of a dry-land situation, not in a building?                       Did you ever

15   discuss that or present that plan to the Town?

16        A     No.     We have not -- we have not submitted a

17   plan.

18        Q     And you've never considered that in terms of a

19   potential economic generator for the property, that type

20   of use?   You've never considered it, have you?

21        A     Oh, I think it's been considered.

22        Q     Have you considered it?

23        A     Have I considered it?

24        Q     Yes.

25        A     No.     Have we thought of it as a practical use?

                  Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons         1697


 1   Have we considered it?              Yes.       I mean, existing use right

 2   now, some of that occurs.

 3        Q    Okay.        But that's strictly with the boat repair

 4   yard?

 5        A    But there are boats stored on site.

 6        Q    All right.            I want to go over to this plan and,

 7   actually, what I want to do, simply because I can touch

 8   this and I can't touch that, is I'm going to put this

 9   version -- I recognize -- well, are they the same?

10        A    I believe they're the same.

11        Q    I'm not really sure, but we'll go with it and

12   assume they're close enough, okay, for government sake,

13   as we say.     They're close enough.

14             Okay.        So I want to use the plan to illustrate

15   what were the battles you were facing or the challenges

16   you were facing for the property.

17             This building could not have been built under

18   the codes, and specifically under the Comp Plan of the

19   Town before the property was purchased; is that correct?

20        A    That's correct.

21        Q    And the reason is because of the

22   5,000-square-foot building limitation and the riverfront

23   commercial, correct?

24        A    Correct.

25        Q    And that restriction applied not just to the

                  Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons                1698


 1   ROD but to all of the RC, riverfront commercial?

 2        A    Yes.

 3        Q    The B-2?

 4        A    Uh-huh.

 5        Q    Help me, is this one building or two?

 6        A    That's two buildings.

 7        Q    How big are these buildings?

 8        A    They're 5,000 square feet.

 9        Q    Each?

10        A    Each floor plat -- or each floor plate is 5,000

11   square feet.

12        Q    How big is this?

13        A    That's bigger than that.                       That's 7500 square

14   foot or more.

15        Q    So this building would not have been permitted

16   under the existing regulations of the Town and its Comp

17   Plan when the property was purchased, correct?

18        A    Correct.

19        Q    Okay.       Now, this plan calls for the vacation of

20   a public road, doesn't it?

21        A    Not necessarily.

22        Q    Where is Front Street here?

23        A    It runs right there.

24        Q    That's it here?

25        A    Correct.

               Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons      1699


 1        Q      Okay.     It may have been some other witness and

 2   I may have forgotten, so it's possible, but are you aware

 3   of the plan that -- associated with this plan to call for

 4   the Town to vacate Front Street?

 5        A      Am I familiar with a plan to vacate Front

 6   Street?

 7        Q      Associated with this plan?

 8        A      This plan did not necessarily require the

 9   vacation of Front Street.               Front Street was part of this

10   plan.    That right-of-way for Front Street, other than

11   having to be modified with the roundabout, we were

12   incorporating the right-of-way into the plan.

13        Q      Okay.     So as far as you know, despite what

14   anybody else may have testified, you didn't require the

15   vacation of Front Street?

16        A      I don't know that it would require the

17   vacation.

18        Q      Okay.     Now, this piece over here, the very

19   first piece that they bought, the Scott parcel -- six

20   acres, I believe?

21        A      Yes.

22        Q      This was zoned how when they bought it?

23        A      B-2.

24        Q      How is it zoned today?

25        A      B-2.

                 Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons             1700


 1        Q     Does B-2 allow the use that's shown on this

 2   diagram?

 3        A     The residential use?

 4        Q     Yeah.

 5        A     No, it does not.

 6        Q     Did it ever?

 7        A     There was residential use on the property prior

 8   to -- to us purchasing the property.

 9        Q     Okay.       When you say "residential use," are we

10   talking about the live/work use?                      Is that what you're

11   speaking of?

12        A     No.     There was a residential house.

13        Q     Okay.       Are you talking about the house that

14   we've talked about that was --

15        A     Uh-huh, yes.

16        Q     -- that somebody --

17              Do you know whether that was qualified as a

18   live/work space?

19        A     I do not.

20        Q     Okay.       So it could have been that?

21        A     Right.       I don't know for sure.

22        Q     Okay.       So, short of the live/work exception,

23   this was not ever zoned residential?

24        A     That's correct.

25        Q     So it's what you had when you bought it?                     It's

                Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons                   1701


 1   what there is today?

 2        A     That's not what the Town wanted.

 3        Q     That's not what I'm asking you.

 4        A     Okay.     I'm just --

 5        Q     That was a restriction for this piece all

 6   along?

 7        A     Black and white, yes.

 8        Q     Never changed.

 9              This piece down here is the multi-family piece,

10   right?

11        A     That's correct.

12        Q     This is the piece that was available for some

13   residential development?

14        A     Yes.

15        Q     And this is the piece that you said you were

16   going to use here to provide access and parking to this

17   piece?   That's what you said, right?

18        A     From both directions, from Front Street and

19   from Ocean Way, yes.

20        Q     And was that ever permitted?                         Was it ever a

21   situation where you could be permitted to provide that

22   access through this property based on the existing codes

23   of the Town?

24        A     Access or use?

25        Q     Well, both.

                Southern Reporting Company (386)257-3663
                       Non-Jury Trial Before Judge William A. Parsons              1702


 1        A      I suppose we wouldn't have had an issue with

 2   access, but, as you mentioned, it wasn't -- it wasn't

 3   zoned for residential use at the time.

 4        Q      Okay.       The two pieces together, are they under

 5   10 acres?

 6        A      Yes.

 7        Q      The moratoriums that we've talked about, we

 8   went up through the end of 2006.                       There was another, what

 9   we call, a zoning-in-progress resolution that was in

10   place for a portion of 2007, right?

11        A      Yes.

12        Q      But that didn't affect this property at all

13   either, did it?         It certainly didn't affect the project

14   that you talked about regarding townhomes and here,

15   because it involved an area to be established called

16   Lighthouse Overlay District, and it also involved issues

17   of any project involving slip allocation?                          And this

18   didn't have any of those elements, did it?

19        A      Well, it did have slip -- I mean, the entire

20   master plan --

21        Q      No.     I understand that.

22        A      Okay.

23        Q      I'm talking about just the townhome piece,

24   okay, the part that we're talking about that you

25   testified to earlier, this piece, and providing access

                 Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons         1703


 1   through here.      This was under 10 acres?

 2          A   (Witness nods head affirmatively.)

 3          Q   Yes?

 4          A   Yes, it is.

 5          Q   It was available for a small-scale amendment?

 6          A   It was.

 7          Q   No small-scale amendment was ever applied for?

 8          A   Nor would the Town have approved one.

 9          Q   And you know this because you can read a mind?

10   Why do you know this?

11          A   Because they asked that we master plan the

12   whole property, that we look at it in total as a

13   mixed-use project.

14          Q   I understand that.                  But when you say that they

15   would have never approved a small-scale, you're

16   speculating now, because you never applied for one, did

17   you?

18          A   Okay.       Yes, I'm speculating.

19          Q   Okay.       And so, just to be clear, during most of

20   2007, too, you could have done this with this piece?                   You

21   could have taken this piece and tried a small-scale

22   amendment?

23          A   Potentially.

24          Q   But you didn't apply for one?

25          A   Correct.

                  Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons                1704


 1        Q      Okay.     Now, one last point I want to make

 2   regarding these moratoriums is, that you said that they

 3   only applied to the ROD.              Have you actually read them?

 4        A      Each one?

 5        Q      Yes.

 6        A      I may have at the time.                    I can't restate them

 7   verbatim.

 8        Q      I just want to see if you want to revisit that

 9   testimony and correct yourself.                    You are aware that they

10   applied to the riverfront commercial, not just the ROD,

11   are you?

12        A      The land use, yes.

13        Q      Okay.     And the riverfront commercial is larger

14   than the ROD?

15        A      Yes, it is.

16        Q      So, for example, if I was the Inlet Harbor and

17   I wanted to put in a new fill-in-the-blank, a boat stack,

18   a new area for parking, I would have been affected?                      Yes?

19        A      Yes.

20        Q      The same with the Lighthouse Boatyard?                    If I

21   decided to take my piece and try to put a boat stack

22   there, it would have been affected?

23        A      Yes.

24        Q      Okay.     And one of the things that you said

25   during your testimony in deposition, I want to see if I

                 Southern Reporting Company (386)257-3663
                       Non-Jury Trial Before Judge William A. Parsons         1705


 1   understand it correctly today, is that your strategy --

 2   you had a strategy that you devised with Pacetta about

 3   how to deal with all of the restrictions we've walked you

 4   through on this plan.              And the strategy for addressing

 5   them was to trade off -- and these are the exact words I

 6   recall from your deposition.                    I'm happy to put it in

 7   front of you if you want to see it.

 8               But I think you recall testifying, it was a

 9   trade-off of benefits that were more than the property

10   would be allowed in exchange for -- a trade-off or -- or,

11   excuse me, entitlements to more than the property would

12   be legally allowed in exchange for public benefits.

13               Do you recall us discussing that issue?

14        A      Trade-offs are always a part of PUDs.

15        Q      Okay.       And that's an interesting choice of

16   words, because a trade-off implies a negotiation of a

17   type.

18               Do you agree with that characterization of what

19   was in play here in Ponce Inlet?

20        A      Yes.

21        Q      And when parties negotiate, they don't always

22   reach a deal, do they?

23        A      No.

24        Q      And, in fact, that is exactly what happened

25   here.    There was never a complete meeting of the minds or

                 Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons           1706


 1   agreement between these parties as to what would be

 2   accepted ultimately by the Town and one party, the Town,

 3   simply said, No.       They drew the line and said, We've

 4   decided not to do this?             Isn't that a fair

 5   characterization of what happened here?

 6        A    No.

 7        Q    Okay.       How is it not fair?

 8        A    I don't think we were ever provided the

 9   opportunity for a negotiation to occur.

10        Q    Okay.       Well, did you have meetings with the

11   Town discussing these plans, as you've testified?

12        A    We did.

13        Q    Did you present them?

14        A    We presented them in a -- in a plan form.                 We

15   were not provided an opportunity at that point to submit

16   them --

17        Q    Okay.

18        A    -- for this negotiation.

19        Q    Okay.       Well, let's be clear here, because I

20   want to make sure that everything is in context.                 We've

21   already went -- gone through this.

22             You had opportunities to apply for stuff that

23   would actually require the Town to consider them; but you

24   didn't apply?     You could do -- how big is this piece

25   here?

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons                     1707


 1          A    Six acres.

 2          Q    Is small-scale applicable?

 3          A    It would be.

 4          Q    If you added in this piece here, would it still

 5   be under 10?

 6          A    It would.

 7          Q    Okay.      But you didn't apply for that?

 8          A    We took the lead from the Town at that point.

 9          Q    I'm sorry?

10          A    We took the lead from the Town at that point as

11   far as master planning a larger piece.                            That's how they

12   wanted it.     They did not want it piecemeal.

13          Q    But you had a choice to make an application to

14   do exactly what we're talking about and you chose not to

15   because of negotiations or working with the Town, as you

16   say?    That was the reason you did it, but it was a

17   strategy, wasn't it?

18          A    It's -- it's pretty much the standard strategy

19   through -- through working with any town.                           You don't

20   typically go -- cross the Town's will to that degree.

21          Q    Okay.      And you met with Mr. Grigas, I believe,

22   on -- for the first time, I think we established it in

23   your depo, on 9-16-05, to go over your master-plan

24   concept, the one that's shown on the slide on the wall

25   there?

                  Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons      1708


 1        A      If I said that, I -- we -- we met to discuss

 2   the concept at that time.               We had met previous to that in

 3   roughing out bigger ideas.

 4        Q      Okay.     And on that date is when Mr. Grigas --

 5   at least at that date, if not sooner, he outlined for you

 6   all of the various hurdles that had to be cleared in

 7   order for this kind of a project to get approval of the

 8   Town, didn't he?

 9        A      There was discussion about those elements.

10        Q      Okay.     Now, you testified, too, about the

11   multi-family project, separate and apart from this

12   overall development, that was attempted, according to

13   your testimony, to be applied for at some point April,

14   May or March, April, somewhere in that area, of '07?               Do

15   you recall that testimony?

16        A      I do.

17        Q      Do you remember the exact date?

18        A      No, I do not.

19        Q      Okay.     And you are -- are you unaware of the

20   reasons for -- or do you -- are you not sure of the

21   reasons why, if, in fact, this happened, that it

22   happened, or do you know why it happened?

23        A      I know some of the background leading into what

24   happened.    I don't know exactly why it went the way it

25   went.

                 Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons               1709


 1        Q     Okay.      Well, are you aware of the fact that

 2   there was an existing development permit that was done by

 3   Mr. Knight on the property, the MF-2 piece, prior to

 4   Mr. Johnson buying the piece?

 5        A     Yes, I was.

 6        Q     Are you aware -- or was it the intention for

 7   you and your -- I'm trying to -- co-planners, if you

 8   will, the architect, the engineers, the contractor -- was

 9   it your intention to fly under that permit?                      In other

10   words, it already had been approved and issued and you

11   were making tweaks to that plan.                     Was your intention to

12   fly under that permit?

13        A     I think that the attempt was to make a permit

14   modification.

15        Q     Okay.      Are you aware, as you sit here today,

16   that that permit actually expired on its terms in August

17   of '06?   Did you know that?

18        A     No, I didn't.

19        Q     That surprise you?

20        A     Not necessarily.

21        Q     Do you know that no applications for extension

22   of that permit were ever made by Pacetta or anyone on

23   behalf of Pacetta?

24        A     I wasn't aware of that.

25        Q     Okay.      And when this rejection that's been

                Southern Reporting Company (386)257-3663
                       Non-Jury Trial Before Judge William A. Parsons   1710


 1   characterized by various folks occurred, did you, on

 2   behalf of your client, approach the Town and ask, Why did

 3   this happen, and, We'd like to appeal this decision, or,

 4   We'd like to take it up in front of P and Z or the

 5   Council?    Did you do any of those things?

 6        A      I think that was related more to the

 7   architect's modifications to the building at that point.

 8   We had proceeded along with the site engineering to match

 9   that.    But the initial rejection was one from a building

10   permit modification rejection.

11        Q      Okay.

12        A      So your question would have been -- the

13   architect would have to answer your question regarding

14   following up with the building permit.

15        Q      Your firm didn't follow up, did it?

16        A      On the building permit?

17        Q      On this Town's rejection of the plans that's

18   been testified to by you?

19        A      No.     That was the architect that -- and the

20   general contractor that pursued that.

21        Q      So, if he didn't do it and you didn't do it, do

22   you know of anybody who did do it?

23        A      As far as following up?

24        Q      Uh-huh.        To actually try to get an answer and

25   see if they would reconsider, anything like that?

                 Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons                 1711


 1        A    I didn't follow up.                 It wasn't my place.

 2        Q    Okay.      And we've already established that the

 3   2006 slash -- the number 2006, but it took place for

 4   several months in 2007, the zoning in progress

 5   resolution.    That was not a reason, because that didn't

 6   apply to this project, did it?

 7        A    The zoning in progress?

 8        Q    Yeah.

 9        A    Correct.

10        Q    Okay.

11        A    But it would apply to the master plan that we

12   were doing, if we were going to proceed with the master

13   plan.

14        Q    Because that included the slips?

15        A    Right.

16        Q    But this one didn't?

17        A    Right.      Right.         Correct.

18        Q    Now, the last plan presented to the Town for

19   consideration of the mixed-use concept plan, which,

20   again, this is what I'm pointing to over here -- I would

21   love to tell you I know what number it is.                      I know it's

22   in evidence.    I just can't remember the number, but it's

23   the one we looked at the entire trial almost.

24             That was last presented for comment or

25   discussion before the Town on the 14th of October of '08;

               Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons      1712


 1   is that fair?

 2        A      That's fair.

 3        Q      Okay.     Now, there's been a lot of testimony in

 4   this case about these plans or drawings to be on display

 5   at the restaurant.         In fact, I think you provided some of

 6   that testimony as well?

 7        A      They were -- they were available for anybody to

 8   look at at the commercial restaurant, that's correct.

 9        Q      All right.         Now, there's no process that you

10   ever found in the Town's codes that displaying plans at a

11   restaurant or any other business constitutes an

12   application, does it?

13        A      No, but we were -- we were transparent with our

14   plans.

15        Q      And the presentation that was made on

16   October 14th, '08, you were there for that?

17        A      Yes, I was.

18        Q      And at that time, it was made very clear to

19   Council that you were not there for approval of this

20   plan.    It was for discussion purposes only; it was merely

21   a concept, correct?

22        A      It was one step past a concept, but yes.             We --

23   we understood that that was not a formal application.

24        Q      Okay.     And so, from the Town's perspective,

25   this beautiful rendering over here was not an actual

                 Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons             1713


 1   commitment on behalf of the developer to do anything; it

 2   was nothing more than a concept; is that correct?

 3        A      That's correct.

 4        Q      Okay.     And there have been no more submittals

 5   for the mixed-use project in the form of presentations or

 6   actual applications at any time from that time, 10-14-08

 7   to right here, right now, today, fair?

 8        A      There were dock submittals and permits that

 9   were --

10        Q      I understand and let me -- I appreciate you

11   pointing that out.

12               THE COURT:         Let him answer.

13               MR. SHEPARD:           Yes, sir.

14               THE COURT:         You cut him off.

15               MR. SHEPARD:           Go ahead.           I apologize.   Go

16        ahead.

17               THE WITNESS:           Just the dock permitting that we

18        went through, we did get -- we were able to make

19        applications and get -- get approvals for a limited

20        amount of dockage.

21   BY MR. SHEPARD:

22        Q      Okay.     But as far as this plan, which is what

23   my question was, this plan or something like it, this

24   mixed-use plan, has never been applied for since

25   10-14-08?    It wasn't actually being applied for then and

                 Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons              1714


 1   it had not been applied for, or some version of that,

 2   right up until and including today?

 3        A     That is correct.

 4        Q     And the reason -- and you'll recall we

 5   discussed this in your deposition, too, it really had

 6   nothing to do with moratoriums.                   It had to do with these

 7   preexisting regulations.             Remember, we went through each

 8   one of them and I asked you specifically about the

 9   moratoriums and whether they were the reason.                   And your

10   testimony was that it was actually the Comp Plan that

11   caused you the problems with submitting applications,

12   fair?

13        A     Fair.

14        Q     Since the LUDCs of 2010 have been revised, the

15   Pacetta Group has made no application for development of

16   any kind under the 2010 regulations, have they?

17        A     No, they have not.

18        Q     And you would agree that it has become

19   substantially harder to make projects, like these

20   mixed-use projects illustrated on the wall and in front

21   of you, work due to the economy, since early 2006,

22   correct?

23        A     I would agree.

24        Q     And that has nothing do with the Town

25   regulations in Ponce, does it?

                Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons               1715


 1        A    The economy?

 2        Q    Yes.

 3        A    No.     I wouldn't blame that on the Town.

 4        Q    Okay.       So, bottom line:                 There was never a time

 5   during any time you've been involved with this project,

 6   this mixed-use project, that what was planned for was

 7   legal in the Town of Ponce Inlet, was it?

 8        A    No.

 9             MR. SHEPARD:             Okay.       Just a moment, Your Honor.

10             I did omit something, which I do occasionally.

11   BY MR. SHEPARD:

12        Q    A vested right is a right to actually be able

13   to go do something?          In other words, when it comes to

14   your business, when you say someone has a vested right,

15   they can actually go pull a permit, correct?

16        A    Yes.

17        Q    Okay.       So, combined with your last answer,

18   there were no vested rights at any time for this project,

19   were there?

20             MR. HEEBNER:             Objection, Your Honor.          I think

21        that it asks for a legal conclusion for which this

22        witness is not qualified.

23             THE COURT:           Sustained.

24             MR. SHEPARD:             Your Honor, may I be heard or --

25             THE COURT:           No.

               Southern Reporting Company (386)257-3663
                       Non-Jury Trial Before Judge William A. Parsons               1716


 1               MR. SHEPARD:             Okay.

 2               THE COURT:           That's what the whole case is

 3        about.

 4               MR. SHEPARD:             Yes, sir.

 5               THE COURT:           If you read the statutes that we're

 6        talking about, I don't think he can give his opinion

 7        on that.       It's an ultimate question for the Court,

 8        whether it's factual or legal, yet to be decided.

 9               MR. SHEPARD:             Okay.       All right.        I'm tempted to

10        use the phrase, more ways to solve the problem, or

11        another phrase that I won't use.

12   BY MR. SHEPARD:

13        Q      Well, let's try it a different way,

14   Mr. Momberger.        At any time during your involvement with

15   the project, did Pacetta have a right to a dry boat

16   storage facility of 50,000 square feet or more on this

17   location?

18        A      No.

19        Q      At any time did Pacetta have a right to a

20   7500-square-foot commercial building on this location?

21        A      No.

22        Q      At any time did Pacetta have a right to put

23   multi-family housing on this location?

24        A      A right?

25        Q      Yes.

                 Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons                1717


 1        A    A right to ask or just a --

 2        Q    A right to build it.

 3        A    A right to build?                No.

 4             MR. SHEPARD:            That's all I have.

 5             THE COURT:          Any redirect?

 6             MR. HEEBNER:            A little bit.

 7                         REDIRECT EXAMINATION

 8   BY MR. HEEBNER:

 9        Q    Just to be sure we understand your testimony,

10   the fact that the Comp Plan may or may not have

11   disallowed any of these uses in the mixed-use development

12   that was proposed by you and the Town, an application

13   could have been made to amend the Comp Plan and/or the

14   LUDC but for the moratorium; is that correct?

15        A    That's correct.

16        Q    Does the current PWD ordinance that you

17   testified to before require a mix of uses?

18        A    It does.

19        Q    What is that mix?

20        A    There's a percentage of commercial and

21   residential that has to be provided.                       There's a range

22   allowed, but there is a mix required.

23        Q    What, generally, are those percentages?

24        A    I think it's 30-40 commercial and up to 60 for

25   residential.

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons            1718


 1        Q      And in your examination of this area right

 2   here, this is in the high-hazard flood plane here

 3   designated by the Town?

 4        A      Yes, it is.

 5        Q      And what does that do to the use of that

 6   property here?

 7        A      It restricts it to commercial uses,

 8   non-residential.

 9        Q      Is it true that under the existing LUDC that a

10   dry storage facility must be fully enclosed and

11   sprinkled?

12        A      Yes.

13        Q      Therefore, placing boats in racks, as bizarre

14   as that might be under those oak trees, is no longer

15   allowed under the existing LUDC?

16        A      That's correct.

17        Q      You were -- discussed with you, the quote,

18   Really new, cool uses allowed in the Planned Waterfront

19   Development --

20               MR. SHEPARD:            Objection, Your Honor, that is

21        not what I said at all.                   I never called them cool.

22        I may have called them new, but that's definitely

23        not what I said.

24               THE COURT:          And your objection is he misquoted

25        you?

                  Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons           1719


 1             MR. SHEPARD:           Well, my objection is that he is

 2        misleading the witness as to what's been testified.

 3             THE COURT:         Okay.        The witness, I'm sure, can

 4        handle it.     If he can handle you for an hour, I

 5        think he can handle Mr. Heebner.

 6             Overruled.

 7   BY MR. HEEBNER:

 8        Q    Just real quickly, let me go over the uses that

 9   are available and ask if they change your opinion in any

10   way on the current viable use of the B-2 property,

11   whether it be here or here:               A community garden, elevated

12   boardwalks, farmers market, golf course and country

13   clubs, health club, houses of worship, libraries,

14   miniature golf, mosquito control ditches, movie theater,

15   museum exhibition or similar facility, nature preserves

16   and passive recreational activities and facilities.

17             Next:     Parks and recreation areas and

18   facilities, research and development facility, riverfront

19   walking paths and trails.

20             Now, these are the new uses placed into the WPD

21   [sic] that exists on this property today, which did not

22   exist back in 2008.

23             Do the addition of those uses change your

24   opinion on the feasible use of this property?

25        A    Not at all.

               Southern Reporting Company (386)257-3663
                       Non-Jury Trial Before Judge William A. Parsons         1720


 1        Q      Have you made an attempt to apply some sort of

 2   straight zoning to the properties, assuming that you

 3   could get the Town to agree to rezone, say, this to

 4   residential or into some sort of recreational, some sort

 5   of use here?      Based on the existing -- on the straight

 6   zoning and based on the ROD and the performance standards

 7   in the current LUDC, can you build any reasonable

 8   investment-backed expectation use of this property?

 9        A      In my opinion, a very diminished development

10   opportunity exists working through the current zoning and

11   the ROD.

12        Q      Is it possible to build anything that reached

13   the investment-backed expectation of the owners of this

14   property?

15        A      No.

16               MR. HEEBNER:             We have no further questions.

17               THE COURT:           Any recross?

18               MR. SHEPARD:             Just one moment, Your Honor.

19               MR. HEEBNER:             Okay.       By the way, those exhibits

20        are in, Exhibit 267 in evidence and 134.

21               THE COURT:           Thank you.

22                              RECROSS-EXAMINATION

23   BY MR. SHEPARD:

24        Q      Just briefly, so there's no confusion here --

25   that's something I'm very mindful of -- even if you don't

                 Southern Reporting Company (386)257-3663
                       Non-Jury Trial Before Judge William A. Parsons                1721


 1   see the new permitted uses as valuable, they are in

 2   addition to the uses that were there when the property

 3   was purchased, correct?

 4        A      Yes.

 5        Q      They're not a takeaway?

 6        A      No.

 7               MR. SHEPARD:             Okay.       That's all I have.       Thank

 8        you.

 9               THE COURT:           Thank you.

10               May this witness be excused?

11               MR. HEEBNER:             He may be excused.

12               THE COURT:           You may step down and you're

13        excused.       Thank you for coming.

14               (Whereupon, the witness left the stand.)

15               MR. HEEBNER:             We call Mr. Linwood Gilbert.

16               THE COURT:           Are we still on schedule for a rest

17        at the end of the day?

18               MR. HEEBNER:             I don't think we'll make it, Your

19        Honor.    I'm sorry.             I can't --

20               THE COURT:           I'm not complaining.              I was just

21        expecting you to answer otherwise.

22               MR. HEEBNER:             I was just advised that -- we've

23        got one more witness that we'll probably have to --

24        we won't get to today.

25               THE COURT:           Okay.

                 Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons     1722


 1             MR. HEEBNER:              But we'll be done by noon,

 2        assuming cross -- I can't control that.

 3             THE COURT:            We just -- as soon as we can, you

 4        need to let them know.

 5             Okay.        Swear the witness, please.

 6             THE CLERK:            Please raise your right hand.

 7             (Whereupon, the witness was sworn in by the

 8   clerk and responded "I do" to the oath.)

 9   WHEREUPON,

10                    H. LINWOOD GILBERT, JR., MAI

11         having first been duly sworn, was called as

12                 a witness and testified as follows:

13             MR. HEEBNER:              May it please the Court?

14             THE COURT:            You may proceed.

15                             DIRECT EXAMINATION

16   BY MR. HEEBNER:

17        Q    Sir, please state your full name and current

18   address and spell your last name for the court reporter.

19        A    Linwood Gilbert is my name, G-I-L-B-E-R-T.              And

20   my address is 810 South Sterling Avenue, Tampa, Florida

21   33609.

22        Q    And how are you currently employed?

23        A    I am a real estate appraiser with Urban Realty

24   Solutions.

25        Q    And what certificates or designations do you

                  Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons             1723


 1   hold for the practice of that profession?

 2        A    I am a state-certified general real estate

 3   appraiser.

 4        Q    Could you give us briefly your educational

 5   background?

 6        A    I attended the University of Georgia.                      I have a

 7   BBA degree and I have taken the courses -- numerous

 8   courses provided by the Appraisal Institute and other --

 9             THE COURT:            What is a PBA degree?

10             THE WITNESS:              A BBA.

11             THE COURT:            Oh, a BBA, Bachelor's in Business

12        Administration?

13             THE WITNESS:              Yes, sir.

14             THE COURT:            I'm sorry.            What year was that?

15             THE WITNESS:              I got out in '73.

16             THE COURT:            Excuse me.            You may proceed.

17   BY MR. HEEBNER:

18        Q    Mr. Gilbert, since you got your degree, could

19   you give us -- again, summarize your professional

20   experience in the appraising and in the evaluations of

21   real estate?

22        A    Yes, sir.           I began my career out of college as

23   a banker in construction lending, with C&S up in Georgia,

24   was a review appraiser.

25             Moved to Florida in '73 and was with a bank for

                  Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons                1724


 1   about five years doing construction lending.

 2               Became an appraiser for several years, went off

 3   in the development business for about eight years, and

 4   then back in the appraisal business.                        And that's what

 5   I've been doing since 1991.

 6         Q     Your name of your company is Urban Realty

 7   Solutions; is that correct?

 8         A     Yes.

 9         Q     What is the breadth of your practice under that

10   name?

11         A     We appraise any type of real property and have

12   focused on larger commercial and industrial properties

13   and, more specifically, on marinas.

14         Q     And in maintaining your proficiency in the

15   appraisal of marinas, what kind of investigations do you

16   do?

17         A     On this particular marina or all marinas?

18         Q     All marinas.

19               Is this in the Southeast or just in Florida?

20   What is the breadth of your analysis?

21         A     Yes.    It's throughout the Southeast and into

22   the Caribbean.      We appraise about one marina every week

23   or two throughout the state of Florida, occasionally go

24   to Georgia and North Carolina, South Carolina, Tennessee,

25   St. John.

                 Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons   1725


 1        Q    As a part of that process, do you continuously

 2   update your statistical background information that you

 3   use in appraising marinas and associated properties?

 4        A    Yes, we do.

 5        Q    Does any of your breadth of your profession

 6   provide for determining the highest and best use of a

 7   particular piece of property?

 8        A    Yes, it does.

 9        Q    Could you, again, describe for us, at least,

10   several of the larger marinas that you've conducted

11   investigations and appraisals of?

12        A    The largest marinas are probably the Harbour

13   Towne in Fort Lauderdale, and I was the developer/project

14   manager of the Harborage at Bayboro in St. Petersburg,

15   which is 655 slips.

16        Q    And have you had the opportunity, as a part of

17   your professional actions, to appraise dry-stack storage

18   facilities?

19        A    Yes, sir, specifically, quite a few of those.

20        Q    Okay.     Could you describe some of the ones that

21   you have done in recent times?

22        A    Well, starting in the Panhandle, I guess the

23   largest one we've appraised is the Mid Bay Marina, now

24   the Legendary Marina, which was 550 slips and at that

25   time was the largest in the state.

               Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons                     1726


 1              I'm sorry.         We can go down the coast and

 2   name --

 3         Q    Name a couple more.                Just to give us an idea of

 4   what your experience is.

 5         A    We've done a number in the Tampa Bay market,

 6   the Tampa Harbour Marina, Bradenton Beach Marina, the

 7   Naples Harbour, Harbour Towne in Fort Lauderdale,

 8   American Offshore.

 9         Q    Are these all dry-stack storage facilities?

10         A    Those are all dry stack.                     We've also appraised

11   a number of wet-slip marinas.

12         Q    Could you describe for us what a modern

13   dry-stack storage is normally designed to look like?

14         A    Well, dry-stack storage marinas -- let me back

15   up.   Just like an industrial building, it's really

16   designed to encapsulate or weatherproof the use intended.

17   Dry-stack storage marinas house boats.                          And so the size

18   and shape of the marina is based on the type boat you

19   need to house.

20              And what's been happening in recent years, the

21   last 10 years primarily, is that with the cost of fuel

22   going up, we don't have as many of the new sportfishers

23   that have big diesel engines and take a lot of gas.                          The

24   market is trended toward 30- to 35-foot offshore,

25   center-console or walk-around console boats, with two or

                Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons             1727


 1   three outboards, and those are stored high and dry.

 2               The cost of storing a boat in the water is

 3   really measured in the amount of maintenance that it

 4   requires.    It's usually 10 percent of the price of the

 5   boat is what you spend in maintenance each year.                     And

 6   having a boat sitting in saltwater is very detrimental,

 7   so...

 8          Q    And due to dry-stack storages, do they create

 9   additional opportunities for the operations of boat

10   maintenance and repairs associated with that facility?

11          A    Yes, they do.           Most dry-stack storages will

12   offer a variety of concierge services, if you will, where

13   they get the boat ready to go out, but there's also a

14   service department and, typically, a sales department

15   also.

16          Q    What's -- if you know, I have not asked you

17   this question, but it may not be fair, but what is the

18   average size of a dry-stack storage in Florida, a modern

19   one?

20          A    The number of boats?

21          Q    Number of boats?

22          A    It's growing.           About 150 boats is considered

23   the minimum to make it financially feasible.                     That's the

24   sweet spot, where your labor, which is the big problem,

25   because you're open seven days a week -- most of probably

                 Southern Reporting Company (386)257-3663
                       Non-Jury Trial Before Judge William A. Parsons         1728


 1   the newer ones tending around 200 to 225 slips.

 2        Q      Okay.       Let me just show you, again, the

 3   dry-stack storage in Sanibel.                    Is this the kind of thing

 4   that you're seeing that dry-stack storages are now being

 5   built as?

 6        A      Yes.

 7        Q      They're not the old, corrugated, open,

 8   tin-looking buildings?

 9        A      No, no.        Some look like Greek temples.

10        Q      Okay.       And you've seen the one in Inlet Harbor,

11   that facility?

12        A      Yes.

13        Q      In Ponce Inlet?

14        A      Yes.

15        Q      And these facilities that would be built

16   nowadays would not look anything like that particular

17   facility?

18        A      No.     That's basically a covered dry rack.

19        Q      Okay.       Now, let me take you now to the -- what

20   I call the Pacetta property.                    You've seen this before, I

21   believe, but this is a mixed use, including the dry-stack

22   storage on the Pacetta property.

23               First of all, have you visited the Pacetta

24   property?    Are you physically -- are you familiar with

25   the physical aspects of the property?

                 Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons                   1729


 1        A    Yes.

 2        Q    Okay.       And I'll represent to you that this is a

 3   conceptual plan for a dry-stack storage here.

 4             Have you seen this plan before?

 5        A    I believe so, yes, sir.

 6        Q    Okay.       Now, are you generally familiar with the

 7   proximity of this particular facility to the inlet of the

 8   Atlantic Ocean?

 9        A    Yes, I am.

10        Q    Are you familiar generally with the speed zones

11   in this neck of the woods and the -- of the Disappearing

12   Island that's adjacent to this property?

13        A    Yes, sir.

14        Q    What do you know Disappearing Island to be?

15        A    A place where a lot of boats go on the weekend.

16        Q    With beer and stuff.                   Based on --

17             THE COURT:           Mr. Heebner, at its core, it's a

18        sandbar.

19             MR. HEEBNER:             That's right.                 I was going to say

20        something else, too, that was probably

21        inappropriate, but (inaudible).

22   BY MR. HEEBNER:

23        Q    Based on your knowledge of the proximity and

24   location of boat slips, is the proximity to the Atlantic

25   Ocean a very important element to the success of a

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons              1730


 1   dry-stack storage?

 2        A    Yes, sir.

 3        Q    What is your opinion as to the value of this

 4   particular property as a dry-stack storage based on its

 5   location in the Town of Ponce Inlet?

 6        A    It would be very valuable.

 7             The boaters tend to keep their boats at the

 8   destination they want to visit.                     And this type facility

 9   opens the market to Orlando and other population centers,

10   so there's a tremendous market that would -- people that

11   like to fish that could keep their boat here.

12        Q    Now, did you undertake an appraisal report of,

13   what we call, the Sea Love Marina?

14        A    Yes, I did.

15        Q    And do you have that document with you today?

16        A    Yes, sir.

17        Q    And that is Exhibit 147 in evidence, as we

18   speak here.

19             What was your mission in preparing this

20   appraisal?

21        A    Well, essentially, I was advised that a marina

22   was -- how do I say this? -- thought to be permitable

23   and to provide an appraisal of the marina as if it were

24   built and also to provide an appraisal of this property

25   as if it could not be built.

                  Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons               1731


 1        Q      And what investigations did you make to form

 2   your opinion?

 3        A      We conducted a market survey of the occupancies

 4   and rental rates for the marinas up and down the coast,

 5   particularly around the Daytona Beach market.

 6        Q      And what were your findings?

 7        A      That the market was fairly strong.                    It was --

 8   Daytona's a good market.               I've been appraising over here

 9   for 25 or 30 years.           It comes -- as we know, the market

10   was slower in '08, but not particularly slow at that

11   time.    We, in hindsight, know it's slowed down since then

12   but it's beginning to perk back up.

13               But Daytona is a good market and Ponce Inlet is

14   a good location.        They're different type boats that are

15   berthed, if you will, in different locations.                     In other

16   words, the people that tie downtown around Loggerhead,

17   those are people that like to go up and down the lake,

18   the river.     The ones that are near the inlet like to go

19   fishing.

20        Q      And is it a pretty far run to the best fishing

21   grounds off the Town of Ponce Inlet, so speed is a

22   premium?

23        A      The good part about this location, about the

24   coastline along here, is it's not a terribly far distance

25   out to where the fish are, out to the drop-off.

                  Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons             1732


 1        Q    Is the advent of the four-stroke engine a part

 2   of this segue into the new type of fishing machines that

 3   are now becoming more popular?

 4        A    Yes, it is.          The four-stroke engines

 5   particularly gave better gas mileage, cleaning --

 6   cleaning -- cleaner burning and other factors.                  But, now,

 7   the two cycles are getting back the same way, getting

 8   good mileage and low emissions.

 9        Q    As part of your investigations, did you

10   determine and view, generally, the zoning regulations

11   that might apply to this property?

12        A    Yes, I did.

13        Q    And what did you find?                   Is the zoning a B-2

14   zoning?

15        A    Yes, sir.

16        Q    Do you know what that B-2 zoning allows?

17        A    Yes, sir.        It appears to allow retailing and

18   not high-and-dry marinas.

19        Q    Okay.     Now, did you make a determination --

20   first of all, I'd like to offer this evidence -- this

21   witness as an expert in the area of land appraisal,

22   including a specialty in marine.                   I know we don't have to

23   do that, but I'd like to offer him.

24             THE COURT:         Do you wish to voir dire as to his

25        qualifications?

               Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons          1733


 1             MR. SHEPARD:           Just briefly.

 2             THE COURT:         You may.

 3             MR. SHEPARD:           I can do it from right here.

 4                        VOIR DIRE EXAMINATION

 5   BY MR. SHEPARD:

 6        Q    Mr. Gilbert, I just want to confirm, you've

 7   never testified or given an appraisal in an inverse

 8   condemnation action ever, have you?

 9        A    I did in a Bert Harris action.

10        Q    I asked you about an inverse action.                 Have you

11   ever given an appraisal or have you ever testified in an

12   inverse action ever?

13        A    I do not recall, no.

14        Q    And you've only given a Bert J. Harris

15   appraisal one time prior to this; is that fair?

16        A    That's correct.

17             MR. SHEPARD:           Your Honor, obviously I

18        understand the standard, but I don't think he's

19        qualified.

20             THE COURT:         Let me ask -- may I ask him a

21        question?

22             MR. HEEBNER:           Please.

23             THE COURT:         Do you own a boat?

24             THE WITNESS:           Yes, sir.

25             THE COURT:         How big?

               Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons       1734


 1             THE WITNESS:           Right now, I have a 23-foot one.

 2             THE COURT:         And your -- is it power or sail?

 3             THE WITNESS:           It's power.

 4             THE COURT:         All right.            I think he's

 5        well-qualified to give an opinion, not because of my

 6        questions, however.

 7             MR. HEEBNER:           That makes me qualified.

 8             THE WITNESS:           Thank you.

 9             THE COURT:         I've learned in life that many

10        times people that get real close to boats learn not

11        to own boats.

12             MR. HEEBNER:           I wish I had that intelligence.

13                DIRECT EXAMINATION (Continued)

14   BY MR. HEEBNER:

15        Q    What was the date of your appraisal?

16        A    The date of -- the effective date of valuation

17   was November 4, 2008.

18        Q    Okay.     And as part of that appraisal, did you

19   operate under the assumption that the applicable laws of

20   the Town of Ponce Inlet could be modified to provide for

21   a dry-stack storage facility?

22        A    Yes, sir.        That was the hypothetical assumption

23   on which that value was based.

24        Q    And based on your knowledge of appraisals and

25   your knowledge of this property, was that an unreasonable

               Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons         1735


 1   assumption to make?

 2          A   I certainly believe that the site is

 3   well-suited for a high-and-dry marina.

 4          Q   Okay.     In fact, do you have an opinion what is

 5   the highest and best use of this property?

 6          A   The highest and best use would be a

 7   high-and-dry marina.

 8          Q   If you did not have the high-and-dry marina

 9   here, is there any other use that you found in the B-2

10   zoning that would provide any reasonable, feasible,

11   investment-backed use of the property?

12          A   I did not see one.                That's not to say one might

13   not build a shop somewhere but, basically, continued use

14   as a boat repair facility seems to be the only logical

15   use.

16          Q   In your investigations, has the boat storage

17   and boat repair been a long-time historical use of this

18   very property?

19          A   Yes, sir.

20          Q   Now, let's go to your summary, and I'd ask you,

21   again, if you can give us opinion as to what the value of

22   the property would have been, as I understand it, with

23   the construction of an approximately 50,000-square-foot

24   dry-stack storage?        And is that the dimension that you

25   used in your process?

                Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons               1736


 1        A    Yes, sir, more or less.

 2        Q    And about how many dry-stack boats -- how many

 3   boats can be placed in a facility of that size?

 4        A    213, as I recall.

 5        Q    Uh-huh.

 6        A    Yes, sir.

 7             THE COURT:          When you say "high and dry," you're

 8        talking about a boat -- a dry boat stack facility

 9        where they're enclosed?

10             THE WITNESS:            Yes, sir.

11             THE COURT:          Excuse me.

12   BY MR. HEEBNER:

13        Q    And amplify on that, you have forklifts here

14   that move the boats out and place them into the water for

15   the clients?

16        A    Yes, sir.

17        Q    Are the majority of those forklifts, at least

18   the modern ones, run with propane?

19        A    Many are, yes, sir.

20        Q    And what is value of propane over the classic

21   diesel?

22        A    That's a good question.                     I've not priced out

23   propane lately.

24        Q    Well, not the cost, but in terms of noise and

25   dirt, is there an advantage to propane?

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons           1737


 1        A    Yes, there is, but I would also say, that just

 2   like the strides we've made in automobile emissions, that

 3   the diesels that are now being put into forklifts are

 4   quiet and they meet even California standards for

 5   emissions.

 6        Q    What is the -- what was your opinion on the

 7   value of this property if that project was to be built?

 8        A    If the property could be built, I calculated

 9   the as-is value at $4,930,000.

10        Q    And that, again, assumes an approximate size of

11   this building, which is 50,000 feet and 213 slips?

12        A    Yes, sir.

13        Q    And then did you apply some sort of a rental

14   value to the slips themselves?

15        A    Yes, I did.

16        Q    Now, in doing that, did you anticipate or

17   include in your calculations any change in either

18   occupancy or rack rates because of the economy?

19        A    Yes, we did.              It was getting slow in 2008, as

20   we think back in hindsight.                  In 2007, we noticed it was

21   starting to slow.         The housing market had begun to slow.

22   Everyone wondered what was going to happen next.                  2008

23   was really not too bad until later in the year when the

24   financial crisis came to light.

25             But when we did our projections, we had

                  Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons                1738


 1   projected only a 40-percent occupancy the first year,

 2   which would be about now, for the time to build, and only

 3   60 percent next year before it began to stabilize.

 4        Q     Okay.      What is the average occupancy of a

 5   dry-stack storage in the Daytona Beach market?

 6        A     Well, they range from perhaps 60 percent at

 7   Inlet Harbor to 85 percent at the Loggerhead Marina.

 8        Q     Where is the Loggerhead Marina?

 9        A     It's downtown.             It's a new facility.         Used to

10   be Gentleman Jim's or English Jim's.

11        Q     Caribbean Jacks now?

12        A     Yes.     Nice, new marina.                  They can accommodate

13   larger boats.

14        Q     And what was your opinion of value of this

15   property without the construction of the dry-stack

16   storage?

17        A     I felt that without being able to go forward

18   with the dry-stack that I really couldn't see anything

19   one could do that would pay for itself and assume you

20   would consider the existing boat repair yard and, based

21   on that use, I had estimated a value of a million 250.

22        Q     Was that based on potential revenues from the

23   existing working waterfront?

24        A     Yes, more or less.                 I probably gave them more

25   benefit of the doubt, thinking things would improve and

                Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons               1739


 1   they've not.

 2        Q    Based on your current investigations into

 3   dry-stack storage and marinas, generally, has your

 4   opinion changed today from your appraisal of

 5   November 4th, 2008?

 6        A    No, sir, not substantially.

 7        Q    Now, what I would like you to do is, there

 8   is -- I want you to make an assumption -- let me strike

 9   that.

10             Have you spoken with the planners for Pacetta

11   as it relates to the existing regulations in the Town of

12   Ponce Inlet vis-a-vis dry-stack storage?

13        A    Yes, sir.

14        Q    And what have you learned from them regarding

15   the feasibility of this ever being built?

16        A    That it is unlikely it would ever be permitted.

17        Q    Okay.      What is your opinion of value of the

18   property, or as a range today, as a result of their never

19   being able to build this dry-stack storage?

20             MR. SHEPARD:            Objection, Your Honor, this is

21        not a disclosed opinion.                 It was not something that

22        was part of his deposition.                    I went through all of

23        his opinions then and this was not a part of what he

24        was supposed to testify to and it is unfair

25        surprise.

               Southern Reporting Company (386)257-3663
               Non-Jury Trial Before Judge William A. Parsons                1740


 1        MR. HEEBNER:            I don't recall the question ever

 2   being asked.       He was deposed for about four and a

 3   half hours.      I believe all these issues were

 4   discussed.      I believe --

 5        THE COURT:          I mean, the status of the law is

 6   that he needs to sit and make himself available for

 7   inquiry regarding his opinions at the deposition.

 8   If he later forms opinions based on later

 9   investigation or conversation, those can only be

10   used if you -- if you make your opponent aware and

11   give them a chance to depose.

12        So, if this is a later-formed opinion --

13        MR. HEEBNER:            It only -- it's the same opinion

14   he had in '08 because it --

15        THE COURT:          What exactly was your question?

16        MR. HEEBNER:            I'm sorry.            My question was

17   this -- and he does the same thing --

18        THE COURT:          No, no.         Don't explain it.       Just

19   ask it.

20        MR. HEEBNER:            Is -- assuming this building can

21   never be built, what is the impact on the value of

22   the property?

23        THE COURT:          You didn't ask that?

24        MR. SHEPARD:            Your Honor, the predicate that he

25   didn't tell you is that he said, Based on what

          Southern Reporting Company (386)257-3663
              Non-Jury Trial Before Judge William A. Parsons               1741


 1   you've subsequently learned, subsequent to his

 2   deposition, do you have an opinion about what --

 3        THE COURT:         Well, it's your position it's never

 4   been doable?

 5        MR. SHEPARD:           That's correct.

 6        MR. HEEBNER:           That's what I thought.

 7        THE COURT:         Okay.        So what -- so what -- I

 8   mean, the fact that he knows something that was true

 9   before, that doesn't --

10        MR. SHEPARD:           If he --

11        THE COURT:         What new information has he

12   factored into his opinion?

13        MR. SHEPARD:           If he offers an opinion now that

14   he didn't volunteer to have, I can't explore it

15   except now for the first time on the stand.                      Had he

16   said, I've also formed an opinion based on the fact

17   that dry boat storage will never be there and my

18   opinion of value is something different than what's

19   in my report, that would have been a different

20   story.   That's not what happened.

21        MR. HEEBNER:           The deposition he took

22   exhaustively confirmed with his witness that this

23   boat facility --

24        THE COURT:         Let me ask -- let me ask the

25   witness, if I may, a question:                      If you are required

          Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons       1742


 1        to answer Mr. Heebner's last question, does that

 2        change any opinion that you had when your deposition

 3        was taken?

 4             THE WITNESS:              No, sir.

 5             THE COURT:            Pardon me?

 6             THE WITNESS:              No, sir.

 7             THE COURT:            Okay.        Objection's overruled.

 8   BY MR. HEEBNER:

 9        Q    Could you please state the value of the

10   property assuming that this facility can never be built

11   and assuming its current uses under the B-2 or the PWD?

12        A    $1,250,000.

13             MR. HEEBNER:              We have no further questions.

14             THE COURT:            He had already used that number.

15             MR. HEEBNER:              He has.

16             THE COURT:            Okay.        You may cross.

17             MR. SHEPARD:              Your Honor, we're going to do

18        something I almost never do and that's apologize in

19        advance.      This is going to get a little bit ragged,

20        because I expected the next witness was going to

21        be --

22             THE COURT:            I can't hear you.

23             MR. SHEPARD:              I expected the next witness was

24        going to be someone different, so I am not as

25        prepared for this as I would like to be, but I will

                  Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons                    1743


 1        proceed.

 2             THE COURT:           Okay.        March on.

 3                              CROSS-EXAMINATION

 4   BY MR. SHEPARD:

 5        Q    Your appraisal was -- well, let me go to the

 6   illustrator, my analogue exhibit.

 7             You didn't appraise this plan, did you?                          This

 8   is not something you ever appraised, did you?

 9        A    I did not appraise that other part, only the

10   dry storage, this part down on the water.

11        Q    You didn't appraise this part either, did you?

12        A    I'm not sure of the question.

13        Q    Okay.       Well, let's look at your appraisal.                      Do

14   you have a copy in front of you?

15        A    I sure do.

16        Q    Do you have a copy of the sketch that you

17   actually appraised?

18        A    Yes, sir.

19             MR. SHEPARD:             Counsel, do you know what

20        exhibit -- I know it's in evidence.

21             MR. HEEBNER:             I'm sorry.            I wasn't listening.

22        Sorry.

23             MR. SHEPARD:             What exhibit is his appraisal?

24             MR. HEEBNER:             I published it.               It was 147,

25        entered into evidence as 147.

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons            1744


 1   BY MR. SHEPARD:

 2        Q    Okay.        So we're referring to 147 and this is

 3   Page 54 of your appraisal, correct?

 4        A    Yeah.

 5        Q    All right.            Now, these areas that are outlined

 6   that you've drawn on, these are the areas you actually

 7   appraised?

 8        A    I -- I appraised a 213-slip high-and-dry marina

 9   with a boatel and retail facilities and 20 wet slips.

10        Q    Okay.

11        A    The building is -- I see it's a little

12   different.     Well, no, I guess it's about the same.                   It's

13   a little different shape than in that picture.

14        Q    Okay.        So, as I said, this has never been

15   appraised -- is there anything like this on your plan?

16        A    I don't have a fountain on this plan.

17        Q    Okay.

18        A    This plan only covers the high-and-dry storage.

19        Q    How about this?                How about this here, the

20   Sunset Pier, is that on there?

21        A    That's not on there.

22        Q    Okay.        What about this building here, 7500

23   square feet, is that on there?

24        A    No.      That's the existing building.                  I only did

25   the proposed part.

                  Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons               1745


 1        Q    Okay.     You think this is what the existing --

 2   you think this is, what, the existing Hatch; is that what

 3   you think that is?

 4        A    I think so.

 5        Q    Okay.     All right.            So let me see if I can --

 6   you can help me out.         Obviously, this is not the same,

 7   but I'm now looking for just the property area.

 8             You appraised this here, basically this parcel,

 9   not all the way down to the water, and this here,

10   something like that.         That's what you appraised, right?

11        A    Not exactly, but close.

12        Q    Close.     That's what's shown on your sketch

13   here?

14        A    Yes.

15        Q    4.2 acres; is that right?

16        A    That sounds about right, yes, sir.

17        Q    You didn't appraise everything here?

18        A    No, I did not.

19        Q    And what you appraised based on, is

20   instructions you got from Mr. Allen Watts, correct?

21        A    Correct.

22        Q    All right.         There were three things that he put

23   in his letter to the Town and to you regarding what

24   issues he believed impacted the property.

25             One was the moratorium of 2009.                      Remember that?

               Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons                1746


 1        A     Yes, sir.

 2        Q     And you never appraised any impacts on the

 3   areas that you did appraise for impacts with the

 4   moratorium or without?            You didn't appraise that at all,

 5   did you?

 6        A     I did not appraise a moratorium.

 7        Q     Okay.     And you didn't -- the other thing he

 8   asked you about was the Sun Cruz operation.                     And you

 9   didn't appraise the impacts on the property with Sun Cruz

10   or without Sun Cruz; you didn't appraise that either?

11        A     No, I did not.

12        Q     So the only thing you appraised is the effect

13   of a charter referendum in November of '08, correct?

14        A     I couldn't answer that question.                     I'm not an

15   expert in all these planning and zoning matters.

16        Q     Okay.     I understand.

17              The date you picked for the appraisal was based

18   on -- was what date?

19        A     November 4, 2008.

20        Q     Okay.     Which happens to coincide with the date

21   of a charter referendum.             Did you understand that that

22   was what you were actually supposed to appraise, the

23   effect of a charter referendum on the property that you

24   actually were appraising?              Did you understand that?

25        A     I was asked to appraise the property as if one

                Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons   1747


 1   could build a high-and-dry storage facility and if one

 2   could not build it.           And I understand there are many

 3   zoning and land use and referendums and moratorium issues

 4   behind that, but I'm not addressing any of those issues,

 5   just whether you could or could not build.

 6        Q    Okay.        So you didn't actually find out whether

 7   or not what you were being told about "could" and

 8   "couldn't" was actually true, did you?

 9        A    It's a hypothetical condition that it could be

10   built.

11        Q    And when you do highest-and-best-use analysis,

12   you have four things that are absolutely required in each

13   time you do such an analysis, correct?

14        A    That's correct.

15        Q    And one of the most important ones is legal

16   permissibility, correct?

17        A    That's correct.

18        Q    And if it is not legally permissible, on a

19   highest-and-best-use appraisal and you appraise it

20   anyway, you cannot result in what's called a credible

21   analysis under the standards of your profession; isn't

22   that true?

23        A    No, sir.

24        Q    Okay.        Well, you are familiar that if you use

25   hypotheticals they have to result in a credible analysis?

                  Southern Reporting Company (386)257-3663
                       Non-Jury Trial Before Judge William A. Parsons              1748


 1        A      Yes, they do.

 2        Q      And you were supposed to appraise upon a

 3   certain date and time, November 4th, 2008, and its

 4   impacts forward?

 5        A      Yes, sir.

 6        Q      And you did not know at that time that the

 7   restriction on dry boat storage actually went in place in

 8   November -- in January of 2004, not in November of '08,

 9   did you?    You didn't know that?

10        A      I don't recall ever looking into that.

11        Q      Okay.       Did you ever appraise the property for

12   what it would have been worth, before Pacetta bought it,

13   assuming no dry boat storage here?                         Did you ever do that?

14        A      No.

15        Q      Were you ever asked to say, Hey, with the

16   restriction on the property, what -- that was there when

17   we --

18               THE COURT:           Counsel, he told you what he did.

19        I mean, there's a million possibilities that he

20        didn't do.         Are we going to go over every single

21        one?

22               MR. SHEPARD:             No, sir.          I just want to make

23        sure that we're all on the same page.

24               THE COURT:           I know, but this is really getting

25        sophomoric.         I mean, I love being with you and

                 Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons               1749


 1        everything, but, you know, maybe we could just focus

 2        on what he knows, or doesn't know, I guess.

 3             MR. SHEPARD:           Okay.

 4   BY MR. SHEPARD:

 5        Q    And in your appraisal, you acknowledged that

 6   the marine industry had began to suffer greatly,

 7   including dry boat storage, in 2006, not 2007, not 2008,

 8   but it began in 2006, didn't it?

 9        A    Probably was noticeable by then, yes.

10        Q    Okay.     And you said that one of the areas you

11   checked -- you checked was Inlet Harbor for occupancy,

12   right?

13        A    Yes.

14        Q    And you said it was roughly 60 percent?

15        A    Back then?

16        Q    Well, when did you check it?

17        A    We check it periodically.                      We do appraisals all

18   around.

19        Q    Okay.     When did you last check it?

20        A    Probably a week ago.

21        Q    Okay.     And, so a week ago, wasn't it actually

22   57 percent?

23        A    Fifty-seven, as I recall.

24        Q    Excellent.

25             So isn't Inlet Harbor the nearest dry boat

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons                 1750


 1   storage facility to this proposal here?

 2        A    Yes, it is.

 3             MR. SHEPARD:              Just a minute, Your Honor.

 4   BY MR. SHEPARD:

 5        Q    Mr. Gilbert, did you ever find out from Pacetta

 6   how much they actually paid for the properties that you

 7   appraised in 2006?

 8        A    No.      I don't recall, frankly.                       I could go

 9   search my records.

10        Q    Turn to Page 48 of your appraisal, please.                           Do

11   you see the section called Riverfront Overlay District?

12        A    Yes, I do.

13        Q    Would you publish that first sentence right

14   there?

15        A    I'm sorry, would I what?

16        Q    Under the title -- under the subheading,

17   Riverfront Overlay District.

18        A    Yes, sir.

19        Q    And please publish that, meaning, read it to

20   the Court.

21        A    The subject property's governed by an overlay

22   district which was enacted on November 4th, 2008.

23        Q    So, at the time you did this appraisal, you

24   actually were under the impression that the overlay

25   district restricting dry boat storage facilities was in

                  Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons                1751


 1   place or placed into the regulations of the Town on

 2   November 4th, 2008.          That's what you assumed?

 3          A    Well, I was assuming you could not build a

 4   marina as of the date I did the appraisal.

 5          Q    Well, if you look at Page 10 of your appraisal,

 6   down one, two, three, four -- five paragraphs, you have a

 7   description of the property site.                      Do you see where I'm

 8   at?

 9          A    Page 10, what paragraph?

10          Q    The fifth paragraph down.

11          A    One, two, three, four -- five, a description of

12   the property.

13          Q    Please read that paragraph to the Court.

14          A    This is under scope of appraisal, things we

15   did:    A description of the property site, including

16   verification with applicable government authorities as to

17   land use regulation, utilities and property taxes, as

18   well as a non-invasive inspection and a complete

19   description of the physical characteristics of the

20   planned improvement.

21          Q    Okay.

22               MR. SHEPARD:           Ma'am, were you able to get that.

23          I know he read it kind of quickly.

24   BY MR. SHEPARD:

25          Q    Okay.     You didn't actually verify the land use

                 Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons            1752


 1   regulations with the local government, did you?                   Because

 2   if you did, you would have known that the Riverfront

 3   Overlay District was not in place in November of '08; it

 4   was in place of January of '04.                   So you didn't verify

 5   with the local government authorities, did you?

 6        A    Well, I, frankly, think I had a typographical

 7   error there.

 8        Q    Okay.

 9        A    But I do know that -- well, you know what it

10   says.

11        Q    Well, when you verify with authorities, do you

12   look at things like what the Comp Plan permits?

13        A    We looked at all those things.

14        Q    Okay.      Well, is it in your hypothetical

15   conditions that you hypothetically assumed that buildings

16   over 5,000 square feet can be built in this district?

17        A    We assumed that building, or something close to

18   it, could be built, yes.

19        Q    Did you actually verify the regulations that

20   applied to the Comp Plan to build things greater than

21   5,000 square feet?

22        A    I looked enough to know that it did not look

23   like you could build one.

24        Q    Okay.

25             MR. SHEPARD:            Just one minute.

               Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons             1753


 1             I've got nothing further, sir.

 2             THE COURT:         Any redirect?

 3             MR. HEEBNER:           I'm sorry, Your Honor.

 4                        REDIRECT EXAMINATION

 5   BY MR. HEEBNER:

 6        Q    One quick question:                You, again, have inspected

 7   the physical facility known as Inlet Harbor?

 8        A    Yes, sir.

 9        Q    And how did you describe that again?

10        A    You mean, a boatyard?

11        Q    Yeah, the boat -- the stack facility that's

12   there?

13        A    Oh, I'm sorry, Inlet Harbor?

14        Q    Inlet Harbor, I'm sorry.

15        A    Yes, sir.        It -- essentially it is covered dry

16   racks, is what we normally would call that.                    They're not

17   actually buildings.

18        Q    Okay.

19        A    A rack is not a building, quote/unquote, and

20   they're free-standing racks and some have roofs and some

21   have sides to keep the sun off of them.

22        Q    Again, based on your understanding of the

23   market and the intentions here to build, again, a modern,

24   enclosed, fire-suppressed building with great

25   architectural features, would you anticipate, in your

               Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons        1754


 1   opinion, a high degree of success?

 2        A    Yes.      Yes, sir.

 3             MR. HEEBNER:             We have no further questions.

 4                            RECROSS-EXAMINATION

 5   BY MR. SHEPARD:

 6        Q    By any chance, do you happen to know the size

 7   of the individual racks at Inlet Harbor?

 8        A    I don't recall off the top of my head.                 The --

 9   it looks like the average boat in there is about 26 feet.

10        Q    The size of the rack, would you know if it's

11   5,000 square feet each or less?

12        A    Oh, the, quote/unquote, buildings?

13        Q    Yes.

14        A    Possibly.

15        Q    Thank you.

16             MR. SHEPARD:             Nothing further.

17             THE COURT:           Thank you.

18             Can this witness be excused?

19             MR. HEEBNER:             Yes, he may.

20             THE COURT:           You may step down and you can be

21        excused.

22             Thank you for coming.

23             THE WITNESS:             Thank you, sir.

24             (Whereupon, the witness left the stand.)

25             THE COURT:           Is your next witness going to be

               Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons            1755


 1        lengthy?

 2             MR. HEEBNER:             It's another appraiser.          I think

 3        he's going to be a few minutes.

 4             THE COURT:           Okay.        Why don't we take -- let's

 5        take just a short break, let's say a 10-minute break

 6        before he starts.

 7             MR. HEEBNER:             That's fine, Your Honor.

 8             THE COURT:           We'll start at 2:35.

 9             THE BAILIFF:             All rise.

10             (Whereupon, a brief recess was taken at 2:25

11   p.m. and proceedings resumed at 2:45 p.m.:)

12             THE COURT:           Please be seated.

13             This is our next witness?

14             MR. HEEBNER:             It is.

15             THE COURT:           Call the witness, please.

16             MR. HEEBNER:             We call Mr. Paul Roper.

17             THE COURT:           Thank you.            Swear the witness,

18        please.

19             (Whereupon, the witness was sworn in by the

20   clerk and responded "I do" to the oath.)

21             MR. SHEPARD:             Your Honor, may I be heard

22        preliminarily on objections, just so I can preserve

23        it for the record.

24             THE COURT:           Sure.

25             MR. SHEPARD:             Your Honor, we would object to

               Southern Reporting Company (386)257-3663
               Non-Jury Trial Before Judge William A. Parsons      1756


 1   Mr. Roper's testimony as to relevancy under the

 2   Harris claim, under -- which is Count IV and under

 3   Count I, which is the takings claim.

 4         As to II and III, I don't think he has any

 5   relevant testimony, because his testimony is about a

 6   damage question.

 7         As to Count IV, the Harris claim, the Act,

 8   70.001(4)(a), requires that, with the claim, when

 9   it's already been identified as a claim, Mr. Watts'

10   letter, you have to submit a bona fide, valid

11   appraisal.

12         There's no dispute that this appraisal that

13   he's about to talk about wasn't done until 2009,

14   well after the claim was submitted to the Town

15   through its mayor, and that's already been testified

16   to.

17         So it is -- and it also, based on its date, is

18   not impactful based on any of the regulations in

19   issue.   It's date, in 2009, is not relevant --

20   July 19th, 2009 -- 16th, 2009, is not a relevant

21   date to any regulation that has been complained of

22   in the Harris claim.

23         THE COURT:         Okay.        The Harris claim, the

24   notice -- the notice requirements of the Harris

25   claim required, essentially, an appraisal to be

           Southern Reporting Company (386)257-3663
               Non-Jury Trial Before Judge William A. Parsons                 1757


 1   included in the claim.

 2        MR. SHEPARD:            Of the area of the property that

 3   is being inordinately burdened.

 4        THE COURT:          But the appraisal, whether it's a

 5   good appraisal or a bad appraisal, it's just a

 6   precondition to the claim, the Town having to

 7   respond, I think.

 8        MR. SHEPARD:            Correct.          This appraisal is dated

 9   in 2009 and, therefore, does not relate to any of

10   the issues in the Harris claim.                       It's not related to

11   any of the regulations under challenge.                      So, as to

12   the Harris claim, it's irrelevant.

13        As to the takings claim, there is, as you know,

14   a jury portion of this case if we get that far.                       At

15   that point there may be some relevance on Count I,

16   but it certainly doesn't go to the issue of whether

17   there's a taking, particularly since it was an

18   appraisal done for a lender.                     It had nothing to do

19   with existing uses or not existing uses being taken

20   from the property.            And that's a key element of it

21   having any relevancy in that proceeding.                      So as

22   it's --

23        THE COURT:          Well, let me hear Mr. Heebner.

24        MR. HEEBNER:            Your Honor, an appraisal, as

25   required by the statute --

          Southern Reporting Company (386)257-3663
                Non-Jury Trial Before Judge William A. Parsons                      1758


 1          THE COURT:         Let me do this.                   Let me ask the

 2   witness if he'll just step outside while I resolve

 3   this issue.

 4          THE WITNESS:           Absolutely.

 5          THE COURT:         I think that might be better.                   If

 6   you'll just have a seat in the hallway, we'll call

 7   you.

 8          THE WITNESS:           Yes, sir.

 9          THE COURT:         Mr. Shepard, had I thought about

10   it, I would have asked him to leave before you made

11   your motion.

12          Okay.     Your response?

13          MR. HEEBNER:           The appraisal, as required, was

14   supplied with the claim and that meets all of the

15   requirements of the statute.

16          As you may recall, this is a --

17          THE COURT:         So he's not -- this particular

18   appraiser's information is not being offered to

19   comply with the notice or the claim to prove up that

20   a valid claim was submitted under the Harris Act?

21          MR. HEEBNER:           That is --

22          THE COURT:         It's for some other purpose?

23          MR. HEEBNER:           That is correct.

24          THE COURT:         What is the other purpose?

25          MR. HEEBNER:           The other purpose is, we have, as

            Southern Reporting Company (386)257-3663
              Non-Jury Trial Before Judge William A. Parsons                1759


 1   you recall, a continuing Bert J. Harris claim as a

 2   result of the actions of the Town.                        And those

 3   regulations that caused the original claim back in

 4   '08, codified in '09, are exactly the same acts that

 5   they have done in November of 2010 and we sent an

 6   additional letter indicating this is a continuing

 7   claim.

 8        He is going to testify on the impacts of the

 9   existing regulations on the Town, which is part of

10   the Bert J -- on the property, which is a part of

11   the Bert J. Harris claim.

12        It's a continuing thing.                     I mean, it's the

13   same -- the same acts that caused the original

14   claim, they just did again in November of 2010.

15   It's almost virtually the same thing.                       He's going to

16   testify on the impacts of those activities on the

17   value of this particular specific piece of -- piece

18   of property.      And, therefore, it's certainly

19   relevant to the issues in this cause -- I mean, I'm

20   sorry, here, the residential portion.

21        THE COURT:         Is there any -- is there relevance

22   to the taking, the Counts I, II and III?

23        MR. HEEBNER:           Yes.       It's as to the taking as

24   well as to the issue of the Bert J. Harris claim.

25        THE COURT:         In order for there to be a taking,

          Southern Reporting Company (386)257-3663
                 Non-Jury Trial Before Judge William A. Parsons          1760


 1   there has to be shown there's some diminution or a

 2   substantial diminution of value.

 3        MR. HEEBNER:              Correct, and he will testify to

 4   that.

 5        THE COURT:            Doesn't that make it relevant?

 6        MR. SHEPARD:              Your Honor, respectfully, no.

 7   And the reason is because the date of the appraisal

 8   is '09 and we're talking now about regulations he

 9   claims -- there is no such thing as --

10        THE COURT:            I mean, maybe I'm -- maybe I need

11   to have this all explained to me a couple of times,

12   but it seems to me there is a -- there's several

13   levels of analysis that could be undertaken, at

14   least on some of the facts I've heard.                       And,

15   obviously, you haven't started your case yet.

16        But you have a whole bunch of moratoria --

17   moratorii [sic] -- a number of moratorium actions

18   and some called, some not, that lasted for fairly

19   substantial periods of time, which certainly impact

20   ownership and property.

21        And then you have the referendum that was

22   passed and then inserted into the charter, which has

23   been declared to be an illegal act, at least by

24   Judge Graham and now affirmed by the appellate

25   court.     I understand there's a pending petition for

             Southern Reporting Company (386)257-3663
                 Non-Jury Trial Before Judge William A. Parsons            1761


 1   cert, so that's -- we have a pending petition for

 2   cert.

 3        And then there have been follow-on acts that

 4   appeared to be -- appeared to be designed to cripple

 5   this property, if you accept the testimony and

 6   presentation.          And if you want to really get into

 7   the dark side of this, there are at least some facts

 8   that would support a theory that this is all part of

 9   a planned conspiracy to deprive the owner of the

10   value of his property.

11        So, I mean, why isn't it relevant in that

12   stream of set of facts?

13        MR. SHEPARD:              Okay.       Well, I have to break it

14   down one at a time.

15        First, as to the Harris Act, the Harris Act is

16   designed to give local governments an opportunity to

17   respond to claims regarding specific legislation

18   that is being attacked as inordinately burdensome.

19        THE COURT:            But do they have to send you -- in

20   other words -- I mean, I guess do they have to send

21   you -- I don't know what the total number of

22   integers in this stream of violations, but, I mean,

23   let's say it's 10, where they claim that conduct by

24   the government -- and I guess I'm going to have to

25   figure out whether lack of conduct by the

             Southern Reporting Company (386)257-3663
                Non-Jury Trial Before Judge William A. Parsons                  1762


 1   government -- I'm going to have to think about that.

 2   But conduct by the government that causes harm to

 3   their property, you say they have to go out and get

 4   formal appraisals every time that happens?

 5          MR. SHEPARD:           I don't say it.               The statute says

 6   it.    It says this --

 7          THE COURT:         Oh, you say the statute says it?

 8          MR. SHEPARD:           I can read it to you verbatim.

 9   It says that:         A property owner who seeks

10   compensation under this section must present the

11   claim in writing to the head of the governmental

12   entity -- and I'm not that -- except that if the

13   property is classified as agricultural -- which it's

14   not.    The property owner must submit along with the

15   claim a bona fide, valid appraisal that supports the

16   claim and demonstrates the loss in fair market value

17   to the real property.

18          And the way that's determined is, you look at

19   the regulation and that's why Mr. Gilbert did what

20   he did.    You look at, what's the date the regulation

21   is alleged to have applied to the property?                          And

22   then if you assume it wasn't there, the value.

23          So as to the property he evaluated, he followed

24   the proper formula; he just made the wrong

25   assumption about what regulation he was appraising.

            Southern Reporting Company (386)257-3663
               Non-Jury Trial Before Judge William A. Parsons             1763


 1        This appraisal from Mr. Roper -- actually Mr.

 2   Marshall --

 3        THE COURT:          But isn't it the purpose for the

 4   appraisal to give you a measure of the claims so

 5   that you can decide if you should respond?

 6        In other words, if they come in and the

 7   appraisal shows there's a thousand dollars in

 8   damages, then the City basically says, you know, why

 9   bother?

10        But if they come in and say there's a million

11   dollars in damages, maybe you need to -- I mean, it

12   seems to me that the purpose for the appraisal is to

13   put you on notice of the dimension of the claim.

14        MR. SHEPARD:            Exactly.          And this appraisal

15   doesn't do anything close to that, because this

16   appraisal has nothing to do with diminishment of

17   value.

18        THE COURT:          Did you get this -- the appraisal

19   he's going to talk about, Mr. Roper?

20        MR. SHEPARD:            I -- did we -- did I get it?           It

21   was sent to me by Mr. Heebner.

22        THE COURT:          Apparently you're holding it in

23   your hand.      Was that delivered to the City?

24        MR. HEEBNER:            Yes.

25        MR. SHEPARD:            It was --

          Southern Reporting Company (386)257-3663
                 Non-Jury Trial Before Judge William A. Parsons                     1764


 1        MR. HEEBNER:              To counsel.             Once we're in

 2   litigation, we normally communicate directly with

 3   counsel, not to the Town Fathers.                            We think that's

 4   inappropriate.

 5        MR. SHEPARD:              We were in litigation with Mr.

 6   Watts at the time he served, properly, the mayor.

 7   That's because that's what the regulation requires.

 8   But the most important thing is, to be --

 9        THE COURT:            But, I mean, the mayor got it,

10   didn't they?

11        MR. SHEPARD:              Did I provide it -- honestly, I'm

12   not sure whether I provided this appraisal.                            I don't

13   know.

14        THE COURT:            Okay.

15        MR. SHEPARD:              But --

16        THE COURT:            Objection's overruled.                 Bring the

17   witness back.

18        MR. SHEPARD:              Do I need to make any further --

19   for the record -- objections regarding the other

20   part of it, which is the inverse condemnation?

21        THE COURT:            Well, I mean, you need to make

22   objections now.

23        MR. SHEPARD:              Well, I was --

24        THE COURT:            You need to make -- anything you

25   want to make before he comes back in, make now.

             Southern Reporting Company (386)257-3663
                 Non-Jury Trial Before Judge William A. Parsons             1765


 1         MR. SHEPARD:             I just want to make sure, we were

 2   objecting not only to its use in the Bert J. Harris

 3   case, which we think is inappropriate under the

 4   statute, it's also inappropriate under the inverse

 5   case because it has nothing to do with whether

 6   there's been a taking.                  It's an evaluation for a

 7   loan.     It has nothing to do --

 8         THE COURT:           I don't know -- I don't know what

 9   it is.     I just know he's an appraiser and I assume

10   he's going to have an opinion on value.

11         MR. HEEBNER:             Yes.

12         THE COURT:           So we'll cross the bridge -- I

13   would suggest you probably need to raise those

14   objections, as you would any other witness, as we

15   go.

16         MR. SHEPARD:             Yes, sir.

17         THE COURT:           I mean, as far as the -- that he

18   did it for a bank, I'm not sure that's -- well,

19   we'll cross that bridge when you make it.

20         At least your preliminary objection to the

21   witness even testifying at all is denied.                    I think

22   there's at least some showing that he will have some

23   relevant information on some specific matter, and we

24   will cover that question by question.

25         Kevin, can we open up some vents so we can cool

             Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons           1766


 1        this down.        Are we running on the hot side?

 2               MR. HEEBNER:            It's a little stuffy all of a

 3        sudden here, yeah.

 4               (Whereupon, an off-the-record discussion was

 5   held.)

 6   WHEREUPON,

 7                          PAUL M. ROPER, MAI, SRA

 8           having first been duly sworn, was called as

 9               a witness and testified as follows:

10               THE COURT:          You may proceed.

11               MR. HEEBNER:            May it please the Court?      Thank

12        you, Your Honor.

13                             DIRECT EXAMINATION

14   BY MR. HEEBNER:

15        Q      Please state you full name and spell your last

16   name for the court reporter, please.

17        A      Paul M. Roper, R-O-P-E-R.

18        Q      And how are you employed?

19        A      I am the principal chief executive officer of

20   Clayton, Roper & Marshall, Inc., a real estate appraisal

21   firm.

22        Q      And what is the work of that firm?

23        A      We're real estate appraisers and analysts

24   for -- and also brokers for real estate.

25        Q      Analysts for what?

                  Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons            1767


 1        A    Analysts for usually the evaluation and

 2   valuation of all types of issues regarding real property.

 3        Q    Could you please give us your educational

 4   background?

 5        A    I have a BSBA degree in finance from the

 6   University of Central Florida.                   And, of course, I have

 7   all of the requisite courses and so forth in order to

 8   obtain the MAI designation as conferred by the Appraisal

 9   Institute; The SRPA designation, which means Senior Real

10   Property Appraiser, as conferred by the Appraisal

11   Institute, and the SRA designation, Senior Residential

12   Appraiser, as conferred by the Appraisal Institute.

13             I'm a state-certified general real estate

14   appraiser and I'm also a former officer, director and

15   president of the local chapter, Number 100, of the

16   Society of Real Estate Appraisers, which was the

17   predecessor to the Appraisal Institute in the Central

18   Florida area.

19        Q    Could you describe for us how long you have

20   been an SRA appraiser?

21        A    Approximately 30 years now.

22        Q    And have you had experience in testifying or

23   evaluating properties that may be subject to a Bert J.

24   Harris claim?

25        A    Yes, sir, I have.

               Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons              1768


 1        Q    How many times?

 2        A    Specifically, Bert J. Harris Act, Brevard

 3   County versus Stack was, I believe, my first

 4   introduction.     That was several years ago.                    I think that

 5   case is still pending in the Supreme Court.

 6             And then there's Seminole County versus Legard

 7   (phonetic) and that's a case dating back from actually an

 8   action that was taken by a municipality in 1955 and it

 9   was not defined until most recently.

10        Q    Is your appraisal work including both

11   residential and commercial properties?

12        A    Yes, sir, it does.

13        Q    Does it also include sometimes mixed-use

14   properties?

15        A    Yes, sir.

16             MR. HEEBNER:             We'd offer Mr. Roper as an expert

17        in real estate appraisals.

18             THE COURT:           Do you wish to voir dire as to his

19        background and qualifications?

20             MR. SHEPARD:             Not as to his background and

21        qualifications.           But I would ask permission, at the

22        appropriate time, to address the issue -- or

23        readdress, based on your instruction, the previous

24        introduction by the Court and allowance of this

25        appraisal he's about to talk about as an exhibit in

               Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons               1769


 1        this case.

 2             THE COURT:          Well, any exhibit that he offers in

 3        evidence, you can voir dire on.

 4             MR. SHEPARD:            It's already been admitted into

 5        evidence, but now we have Mr. Roper here, so...

 6             THE COURT:          Oh, it's already in evidence?

 7             MR. SHEPARD:            It's already been entered, over

 8        my objection, which I'd like to opportunity, with

 9        this witness, at the appropriate time, to revisit.

10             THE COURT:          You can do that on

11        cross-examination.

12             MR. SHEPARD:            Thank you, sir.

13             THE COURT:          You will have full opportunity to

14        cross-examine.

15   BY MR. HEEBNER:

16        Q    This appraisal is in evidence as 148.                    Now, I

17   want to talk at first about the appraisal dated

18   July 16th, 2009.      Is that an appraisal by your firm for

19   which you --

20             THE COURT:          I'm sorry.            Your earlier objection

21        is to him testifying about his own appraisal that

22        was already in evidence?

23             MR. SHEPARD:            It -- it was, because I didn't

24        think the testimony would add anything to his

25        appraisal for the reasons we already discussed.

               Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons                   1770


 1               THE COURT:         Okay.        Well, that even gives me

 2        further support for my ruling.                        Thank you.

 3               THE WITNESS:           Yes, sir.

 4   BY MR. HEEBNER:

 5        Q      Did you -- I'm sorry, I forget my own question.

 6               You have reviewed the appraisal dated July 6th,

 7    2009?

 8        A      Yes, sir.

 9        Q      Okay.     Was this appraisal actually prepared by

10   one of your partners?

11        A      It was.      Steven L. Marshall.

12        Q      And why did you become involved in this

13   particular appraisal?

14        A      At some -- Mr. Marshall did the original

15   appraisal for Colonial Bank and it constituted the

16   residential portion of the Pacetta properties.                          He was

17   called --

18        Q      So we're all on the same page here, is this the

19   property here, generally, that this appraisal --

20        A      Yes, sir.        That comprised some eight acres of

21   land at the southern end of the Pacetta property.

22        Q      And have you reviewed other appraisals of this

23   property?

24        A      I have, yes, sir.

25        Q      Okay.     And did you review in this appraisal,

                 Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons   1771


 1   though done by your colleague, the assumptions and the

 2   investigations and documentations contained therein?

 3        A    Yes, sir.

 4        Q    And did you review it such as a review

 5   appraiser would do it to verify its findings and

 6   determinations?

 7        A    Yes, sir.        And I also had talked to Mr.

 8   Marshall at the onset when we were asked to look into the

 9   Pacetta matter.

10             Mr. Marshall was ill and had been for quite

11   some period of time.         I picked up the report as the chief

12   executive officer of Clayton, Roper & Marshall,

13   interviewed Mr. Marshall and carried it from there.

14        Q    What other investigations did you make to come

15   to your conclusions and evaluation you will give today?

16        A    Well, I had talked to the land planners

17   extensively and, of course, had inspected the property

18   with the land planners and with the property owners,

19   became acclimated or familiar with the case in general

20   and then the property in particular, based on physical

21   inspections, reading many hundreds of documents,

22   especially those with regard to planning and zoning and

23   land use codes and so forth.

24             But Mr. Momberger and Mr. Dickens were quite --

25   alerted to what was going on with regard to the uses of

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons               1772


 1   the property and responded to my questions accordingly.

 2        Q      Would you describe the quality of this

 3   property?

 4        A      It's probably among the highest-quality land

 5   parcel I've seen in 36, 37 years of my professional

 6   career.   It's undulating topography.                        It's not totally in

 7   the floodplain even though it has 810 feet of frontage,

 8   more or less, on the Halifax River.                         It has the --

 9   roughly just under an acre of a Midden Mound, which gives

10   it an attractive characteristic, as opposed to a

11   detrimental characteristic.                  And then it is thoroughly

12   treed with old southern oaks and all types of special

13   varieties that you would see around the Town of Ponce

14   Inlet and around the inlets and in South Florida also.

15               It's a beautiful parcel of land.                      I don't know

16   how much evidence has been placed on that, but, as far as

17   I'm concerned, it's probably the nicest land parcel I'd

18   ever seen.

19        Q      Now, have you had the opportunity to examine

20   the existing zoning regulations and Comprehensive Land

21   Use Plan in the Town of Ponce Inlet?

22        A      Yes, sir.         The property is still zoned for B-2

23   and MF-2 uses.       And I don't believe that that's changed

24   since -- well, I don't know when they were actually --

25   had been adopted, but it hadn't changed in years.

                  Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons   1773


 1        Q    The B-2 zoning, does that allow for

 2   residential?

 3        A    No, sir.

 4        Q    Based on your experience with this property and

 5   your examination of the records, would you believe that

 6   it could be reasonably anticipated that this property

 7   would be rezoned to some form of residential, be it MF-2

 8   or R-3?

 9        A    Yes, sir.

10        Q    In your opinion, what is the highest and best

11   use of this property?

12        A    Multi-family residential.

13        Q    And was that the same opinion that you and your

14   partner had on July 16th, 2006?

15        A    Yes, sir.         Excuse me, that would be 2009.

16        Q    '9, I apologize.

17        A    Yes, sir.

18        Q    Right there.

19             In an examination of your appraisal of

20   July 16th, 2009, what assumptions were made as to the

21   future use of this property?

22        A    Well, the biggest assumption was, is that we

23   could overcome an existing moratorium at that period of

24   time.

25        Q    And also you'd have to require the Comp Plan

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons   1774


 1   Amendment for the B-2 zoning to get it into residential?

 2        A    Yes, sir.           That would be a requirement for

 3   rezoning and then a change in the Comprehensive Plan.

 4        Q    Have you been through those processes before?

 5        A    I have on occasion over the years, yes, sir.

 6        Q    Is it unusual for an existing -- strike that.

 7             Is it unusual that an appropriate use for a

 8   piece of property is, at that time and place, prohibited

 9   by the existing Comp Plan or zoning?

10        A    Would you repeat the question, please?

11        Q    Sure.

12             Is it unusual that when you begin the

13   development of a piece of property that the uses that may

14   be the best and -- highest and best use is prohibited by

15   the zoning or the Comprehensive Land Use Plan?

16        A    Yes, sir.           Oftentimes the anticipated use would

17   have to go through a rezoning and comprehensive land use

18   change, the long-term use of the property.

19        Q    And is that a reasonable assumption that you

20   would make that this property could ultimately or should

21   be accomplished?

22        A    Yes, sir.

23        Q    And are you aware that there are moratoriums on

24   this property beginning in the year 2007, ending in the

25   year 2010?

                  Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons              1775


 1        A    Yes, sir.

 2        Q    What impact would there have been as a result

 3   of economy if there had been no moratoriums and

 4   Mr. Pacetta would have been able to commence development

 5   of the multi-family development?

 6             MR. SHEPARD:           Objection; speculation.            He's not

 7        shown that he has qualifications to answer what

 8        would have happened in the event of the economy

 9        and --

10             MR. HEEBNER:           Well, I think he's an appraiser.

11        He's going to --

12             THE COURT:         Excuse me.

13             MR. HEEBNER:           I'm sorry.

14             THE COURT:         I think since he's an expert

15        witness, and if it's things upon which he normally

16        relies, and it sounds like it is, that's something

17        he can consider.          So I'm going to overrule your

18        objection.

19             MR. HEEBNER:           Madame Court Reporter, would you

20        read back to me the question?                     I can't read it.

21             (Whereupon, the last question propounded to the

22   witness was read back by the court reporter.)

23   BY MR. HEEBNER:

24        Q    Do you understand the question?

25        A    Yes, sir, I do.

               Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons              1776


 1             The adversity that we all encountered, between

 2   late '06, all the way through, perhaps, even the present,

 3   never did completely bottom out at any given point in

 4   time in and about the Town of Ponce Inlet.

 5             The number of multi-family dwellings, whether

 6   it be condominiums or whether it be single-family

 7   residences, for many years was running around 200 a year.

 8   It bottomed out somewhere in the neighborhood of 70 to 80

 9   during '07 and '08.        I don't have all the exact facts on

10   that.

11             But depending upon the product, i.e.,

12   townhomes, and depending upon the size of the townhomes

13   and the type of quality and so forth, we would have -- I

14   say, the developer would have had some -- some sales and

15   there would have been at least some product that would

16   have exchanged to a perspective purchaser.                     Now, I don't

17   know exactly how many, but it would not have come to a

18   halt.

19        Q    Is this -- again, from a marketing standpoint,

20   and your view of the proximity to the Atlantic Ocean and

21   the dockage that was going with these facilities, would

22   you treat the -- your view of the impact of the economy

23   on this property differently from, let's say, a lot --

24   block Centex development west of I-95 in pine woods?

25        A    Yes.    The type of prospective purchaser that

               Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons                  1777


 1   would be interested in either a condominium or a townhome

 2   in this project would be paying extremely high dollars

 3   and they also would be paying separate --

 4             MR. SHEPARD:           Your Honor, I'm going to object.

 5        This is not an opinion that was disclosed.                      He was

 6        asked questions in his deposition about his

 7        opinions.    These are clearly opinions he's formed

 8        since his deposition, which I just took last week.

 9             This is unfair surprise that should not be

10        permitted.

11             THE COURT:         Overruled.

12             THE WITNESS:           And the perspective purchaser of

13        either a condo or a single-family residence would

14        also either lease or buy a boat slip.                     Now, those

15        are unique and they're usually related to

16        high-dollar entities, which do not require,

17        oftentimes, local or regional financing.                     They come

18        in -- they're cash buyers and they're oftentimes

19        from out of state or even out of the country.

20             It's not an extraordinary inventory that would

21        have been developed on the property.                      I don't

22        believe that the sales would have been so adversely

23        affected as the typical product that you find, say,

24        west of I-95 in some of the residential

25        subdivisions.

               Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons   1778


 1   BY MR. HEEBNER:

 2        Q    Have you -- are you familiar generally with the

 3   zoning maps and the developable lands in the Town of

 4   Ponce Inlet?

 5        A    Yes, sir.

 6        Q    Have you had an opportunity to examine the

 7   moratorium that was placed on this property over the

 8   four-year period?

 9        A    Yes, sir.

10        Q    Is it your opinion that this particular piece

11   of property was the only property practically impacted by

12   those moratoriums?

13        A    That would be my opinion, yes, sir.

14        Q    Based on your review of the zoning regulations

15   of the Town of Ponce Inlet that exist today, is any other

16   property in the Town of Ponce Inlet burdened in the way

17   this property is?

18        A    No.

19        Q    Now, as a part of your investigation, have you

20   also reviewed a zoning overlay district called the

21   Riverfront Overlay District?

22        A    Yes, sir.

23        Q    ROD.      And you examined those regulations and

24   the requirements of that document?

25        A    I have.

               Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons   1779


 1        Q    And are you aware that that ROD impacts only

 2   the property of Pacetta?

 3        A    Yes, sir.

 4        Q    Do you realize now that that had been placed in

 5   by November 2010 into the Comprehensive Land Use Plan of

 6   the Town of Ponce Inlet?

 7        A    Yes, sir.        I'm aware of that.

 8        Q    Have you also examined the portions of the LUDC

 9   that refer to the PWD, Planned Waterfront Development?

10        A    Yes, sir.

11        Q    Are you familiar with PUDs, and this one is

12   analogous to a PWD?

13        A    Yes, sir.

14        Q    Okay.     If you would make the assumption, as the

15   Town is now asserting, that this property can never be

16   rezoned from B-2, what impact, in your view, would be --

17   what would the impact of the current value of this

18   property be as a result of that activity?

19        A    The only optional use under B-2 would be for,

20   perhaps, a city park.

21        Q    Now, let's go back to your appraisal of

22   July 16th, 2009.     What did you appraise the property for

23   as its use?

24        A    Fourteen single-family residential lots were

25   proposed at that time.

               Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons   1780


 1        Q    Okay.       Now, is your view -- what is your view

 2   of the highest and best use of this property based on its

 3   topography and location?

 4        A    Multi-family, it should be townhomes or

 5   condominiums.

 6        Q    And did you examine this piece of property to

 7   determine what its densities would have been back in

 8   2008?

 9        A    I did.

10        Q    And what are those densities?

11        A    The logical densities might have been up to 12

12   units per acre on the eight acres.

13        Q    And just do the math for us real quickly.

14        A    Yes, sir.

15             Ninety-six units would seem to be the optimal

16   number of units.       There might have been more, there might

17   have been less, but it seemed like that might have been a

18   satisfactory compromise between the developer and the

19   City at that time.

20        Q    And did -- what, in fact, did Pacetta propose

21   as its multi-family development in 2008?

22        A    In 2008, the -- Pacetta only was talking about

23   14 detached, single-family residential homesites.

24        Q    Okay.       Do you know how many --

25        A    Less than two per acre.

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons             1781


 1        Q    And, again, in the original diagram for

 2   multi-family --

 3        A    Yes, sir.

 4        Q    -- what number of multi-family units were they

 5   proposing?     And this is before they converted in 2008 to

 6   single-family.

 7        A    Twenty-eight units.

 8        Q    Okay.        And the densities under straight zoning

 9   would have allowed 96?

10        A    Yes, sir.           That straight zoning would be a

11   compromise between the -- between the developer -- the

12   most logical compromise between the developer and some

13   alteration of the zoning in order to achieve any type of

14   economic opportunity for development.

15             At MF-2, it's 40 units an acre.                         There's

16   almost, I think, two and a half or three acres of MF-2

17   and those units most logically would be spread all the

18   way across the B-2, I think, as an option, as an

19   alternative, something that they might be able go to the

20   City to make arrangements to make something happen.

21        Q    What does your appraisal of July 16th, 2009,

22   provide as a value if you can build a single-family with

23   the boat slips, if that's your appraisal?

24        A    Well, with the boat slips -- with the actual --

25   with the boat slips itself, it would be -- take the as-is

                  Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons   1782


 1   value of the land, without any types of improvements

 2   whatsoever at that point in time, that was $10,920,000.

 3   And then the prospective market value of the economic

 4   site with 106 wet slips and site improvement completions

 5   was another $5,400,000.

 6             $16,320,000.

 7        Q    Now, if you -- if you add in the proposed

 8   improvements of the single-family lots, does that -- what

 9   impact does that have on the value of the property?

10        A    Well, if you're going to have proposed

11   improvements on the single-family lots, then that

12   would -- those probably would be related to the added

13   cost of construction and whatever there were to provide

14   housing, if I'm following you correctly.

15        Q    Well, yeah.           I'm asking you if your --

16        A    Right.

17        Q    Does your appraisal include the value of these

18   single-family lots?

19        A    Yes, sir, it does.

20        Q    And what is that number?

21        A    That number just -- just on the -- just on the

22   land is $10,920,000.

23        Q    And the boat slips add what value to the value

24   of the land?

25        A    $5,400,000.

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons                    1783


 1        Q    In consultation with Pacetta's planners and

 2   your own examination of the zoning records, including the

 3   ROD, the WPD [sic], the Planned Waterfront Development,

 4   and its enforcement requirements, have you determined

 5   basically what might be able to be built here based on

 6   those performance requirements and those zoning

 7   regulations?

 8        A    Yes, sir.           As of today --

 9             MR. SHEPARD:              I'm going to object to his

10        opinion again so I have it on the record.                           This is

11        not a disclosed opinion.                   He was asked; he did not

12        disclose this opinion in his deposition last week.

13        It is unfair surprise.

14             MR. HEEBNER:              He never even asked anything

15        about this.

16             THE COURT:            The question is:                  Has he -- has he

17        formed an opinion since his deposition?

18             MR. HEEBNER:              Oh, no.

19             THE COURT:            Well, let me ask the witness.

20             At the time that -- you sat for deposition last

21        week?

22             THE WITNESS:              Yes, sir.

23             THE COURT:            How long did that deposition last?

24             THE WITNESS:              Three hours.

25             THE COURT:            And was that just the direct exam

                  Southern Reporting Company (386)257-3663
                 Non-Jury Trial Before Judge William A. Parsons                   1784


 1   or was there any cross-examination by Mr. Heebner?

 2        THE WITNESS:              Only direct.

 3        THE COURT:            Okay.        And since that time, have

 4   you done any further investigation, gathered any

 5   further information, or changed any of your --

 6   changed, modified, or augmented any of the opinions

 7   that you held when you sat for the deposition?

 8        THE WITNESS:              No, sir.

 9        THE COURT:            Is there anything that you -- okay.

10   That's what I don't get.                   What did he change?

11        MR. SHEPARD:              It's not a question of what he's

12   changed.      He was asked specifically:                        What opinions

13   do you intend to offer at trial?                             This was not among

14   them.

15        THE COURT:            Okay.        But you had a chance to ask

16   him any questions that he might -- you might want to

17   know the answer to.

18        MR. SHEPARD:              As to opinions he was going to be

19   offering at trial.              He didn't have a report other

20   than the appraisal --

21        THE COURT:            But the idea of your -- I mean, if

22   you think about your objection, I live through all

23   this, so -- and this began with doctors and personal

24   injury lawyers.

25        I mean, let me share with you my view of this.

             Southern Reporting Company (386)257-3663
              Non-Jury Trial Before Judge William A. Parsons               1785


 1   In the old days -- and the old days, to me, were, I

 2   hate to say this, from '72 to '85, when we tried

 3   cases, they were by ambush.                   The discovery was not

 4   very complete.        The rules of procedure hadn't

 5   expanded to now being so massively complete.                   And

 6   you'd go to trial and sometimes you'd know what was

 7   going to happen and sometimes you didn't.

 8        And there developed a process, usually in the

 9   personal injury field, I'm sure others, where people

10   would try to get their experts to either not

11   formulate opinions, or hold back their opinions, or,

12   after deposition, go change their opinions by

13   gathering lots of information, doing additional

14   tests.   So they came to trial armed with a whole

15   bunch of information that the lawyer defending had

16   no idea about.

17        And that wasn't -- that was deemed not to be

18   fair, although it had been before, and the courts

19   have basically clamped down on that by saying, Look

20   it, if you want to know what a witness is going to

21   say, you can take their deposition and gather that

22   information, but they can't expand, augment, or

23   change their opinion after you've talked to them,

24   or, if they do, that cannot be used because it

25   wouldn't be fair to you because you didn't get a

          Southern Reporting Company (386)257-3663
                Non-Jury Trial Before Judge William A. Parsons                      1786


 1   chance to learn about it, unless your opponent

 2   learns that has happened, tells you about it and

 3   gives you another chance to bring yourself current

 4   with adequate time preparation and so on.

 5          Now, what I don't -- it seems to me you had a

 6   chance to ask him anything you wanted to ask him.

 7          MR. SHEPARD:           And one of the questions asked of

 8   him:    What are the opinions you plan to testify

 9   about at trial?

10          THE COURT:         Well, how does he know that,

11   though?    The lawyers ask the witness at trial; he

12   doesn't control what he says at trial, the questions

13   do.

14          I mean, you can ask him what opinions he has.

15   I mean, when I used to take a deposition, I'd say,

16   Well, do you have any further opinions?                           And you

17   keep going.       And I'd say, Do you have any further

18   opinion?     And they'd keep going.                         And I would keep

19   saying that until I got blue in the face and he

20   said, No, you've heard all of my opinions.                            So then

21   you've locked him in.                He doesn't -- he's given you

22   anything.      He comes in here and has a new one; you

23   say, Not fair.          You're saying you never asked him

24   about it.

25          MR. SHEPARD:           No, sir.          That's not what I'm

            Southern Reporting Company (386)257-3663
               Non-Jury Trial Before Judge William A. Parsons                1787


 1   saying.

 2        THE COURT:          Well, show me -- show me the

 3   testimony where you locked him in to this -- what

 4   he's being asked today.

 5        MR. SHEPARD:            Do you have the transcript, sir?

 6        MR. HEEBNER:            Don't you?

 7        MR. SHEPARD:            Unfortunately, no, because I

 8   didn't expect he was going to be up today.

 9        MR. HEEBNER:            I'd like to use it, too, but I'd

10   ask the Court to look at it.                     He asked many, many,

11   many questions about the current value of the

12   property of this witness.

13        THE COURT:          Let me see the transcript.             I can't

14   read 300-page testimony, but let me see it.

15        MR. HEEBNER:            It's in evidence.

16        That's the only copy I have.

17        MR. SHEPARD:            It's in evidence?

18        THE COURT:          No, it's not.

19        MR. HEEBNER:            (Inaudible.)

20        THE COURT:          I don't see anything that would --

21   I just don't understand how that -- you can claim

22   surprise when you had a chance to ask him about his

23   questions.

24        MR. SHEPARD:            May I have the transcript for a

25   moment?

          Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons             1788


 1               THE COURT:          Yeah.        You can read it.     I mean,

 2          you can't point to anything where you asked him if

 3          those were all of his opinions, can you?

 4               MR. SHEPARD:            That's --

 5               THE COURT:          I'm going to -- if you can show me

 6          that in the deposition, I'll sustain -- I'll hear

 7          further argument.

 8               I'm going to hear it conditionally at this time

 9          and I'll -- subject to a strike if he can find it,

10          but I can't wait while he reads the deposition.

11   BY MR. HEEBNER:

12          Q    Let me go back to my predicate question,

13   Mr. Roper.

14               You have had the opportunity to examine the

15   existing regulations implemented in the year 2010?

16          A    Yes, sir.

17          Q    And that includes the examination of the

18   Comprehensive Land Use Plan within -- contained in the

19   ROD?

20          A    Yes, sir.

21          Q    And, also, you have examined the Land Use

22   Development Code, the zoning regulations, which also

23   encumber this property?

24          A    I have.

25          Q    Have you also had the opportunity to examine

                  Southern Reporting Company (386)257-3663
                        Non-Jury Trial Before Judge William A. Parsons                1789


 1   the impact of those regulations and Comp Plan on the

 2   potential development of this property with the planners

 3   and staff of Pacetta?

 4          A    I have.

 5          Q    And based on that examination, what impact on

 6   the current value of that property has those regulations

 7   had?

 8               MR. SHEPARD:              Objection, Your Honor.           This was

 9          already testified to by the Plaintiffs' experts that

10          the 2010 Comp Plan has never been applied to the

11          property because it's still on review.                       There's no

12          final order.

13               THE COURT:            Overruled.

14               THE WITNESS:              The current requirements have a

15          dramatic effect --

16               (Simultaneous speaking.)

17               MR. HEEBNER:              (Inaudible.)

18               THE COURT:            Please keep the comments in your

19          mind.

20               MR. HEEBNER:              I'm sorry.            It flew right out of

21          my mouth.       I'm sorry.            I normally -- I apologize.

22               THE COURT:            I don't want anybody cocking off

23          here.     This is a trial.

24               MR. HEEBNER:              I'm so sorry.

25               THE WITNESS:              Current development can't avoid

                    Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons   1790


 1        the PWD requirements without rezoning and maybe a

 2        land use amendment.

 3               The preferred option by the City would be the

 4        PWD.     And it's my understanding that no matter what

 5        development would have -- would take place, that

 6        four out of five councilmen would have to approve

 7        that.

 8               And based on the combination of the PWD

 9        requirements, the ROD requirements, the rezoning and

10        the possibility of a land use plan amendment, these

11        planners believed that the logical land use --

12        predictable land use would be something like four or

13        five house sites, which would reduce the capacity of

14        the land dramatically and, obviously, it's altered

15        its highest and best use.

16   BY MR. HEEBNER:

17        Q      And that would also include, then, the

18   inability to build the boat slips?

19        A      The boat slips would then become a moot point

20   for four detached single-family residential home sites.

21   There's plenty of boat slips out there without new

22   construction now.

23        Q      And we haven't asked you for an actual

24   appraisal of the property at this point in time; is that

25   true?

                  Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons         1791


 1        A     Yes, sir.

 2        Q     But what is your opinion as to, at least by

 3   percentage, the burden and the reduced value of the

 4   property as a result of existing regulations?

 5        A     The property's always going to have residual

 6   value.   It's always going to have a fundamental

 7   purchasing group, even though they might be speculators.

 8              Based on what I find, there is so much

 9   uncertainty involved with regard to the possibility of

10   using this property for intensive use or anything that we

11   would have discussed previously with regard to the

12   highest and best use.           At least two-thirds of the value

13   of the property has been diminished as a result of these

14   uncertainties.

15        Q     If a buyer came to you and asked you to

16   appraise this property for the purposes of obtaining bank

17   financing, do you believe that -- though, you can't give

18   numbers, that that value of reduction by two-thirds would

19   be reflected in an appraisal?

20        A     It certainly should be.

21        Q     That wasn't a great question.

22        A     You'd really have to have some idea of how the

23   property can be utilized in order to establish a proper

24   predicate for the valuation.                 In its absence, it becomes

25   entirely speculative.

                Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons           1792


 1        Q    Based on the performance requirements in the

 2   ROD and the PWD, do you believe that the ability to

 3   predict what you can build on this property is

 4   extraordinarily difficult?

 5        A    I do.

 6             MR. HEEBNER:           We have no further questions.

 7        Thank you, Your Honor.

 8             THE COURT:         Cross-examination?

 9                            CROSS-EXAMINATION

10   BY MR. SHEPARD:

11        Q    Okay.     We talked about uncertainty.               Let's talk

12   a little bit about certainty.

13             You've never appraised this, have you?

14        A    Yes, sir.        That looks like the 14 residential

15   lots that resembled the outline of the appraisal in, I

16   believe it was, June of '09 -- or, excuse me, 2009.

17        Q    Okay.     Help me here.              This is the multi- --

18   this is the residential piece?

19        A    Yes, sir.

20        Q    Okay.     What did you appraise?

21        A    The eight acres of residential land.

22        Q    And these slips that are towards the water?

23        A    Yes, sir.

24        Q    Okay.     So you didn't appraise all of what's on

25   this piece -- this poster board, did you?

               Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons   1793


 1        A     No, sir.

 2        Q     Now, in appraising, you did the

 3   highest-and-best-use analysis, correct?

 4        A     Yes, sir.

 5        Q     And in highest-and-best-use analysis, the first

 6   thing that you're supposed to consider is legal

 7   permissibility; is that true?

 8        A     Yes, sir.

 9        Q     Now, at the time I took your deposition just

10   last week, you didn't know all of the restrictions on

11   this property, did you?

12        A     I think I knew most of the restrictions and I

13   certainly was advised by my land planners or the

14   cooperative land planners as to the impacts of the --

15        Q     Since your deposition you've been advised?

16        A     No, no.      I've been working on this case for

17   quite a while.

18        Q     Okay.     What are the restrictions that applied

19   to this piece?

20        A     Well, at the present, they don't allow dry boat

21   storage -- dry boat storage at that level.

22        Q     Okay.     Dry boat storage facilities; is that

23   correct?

24        A     Yes.

25        Q     Okay.     Not dry boat storage, but dry boat

                Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons                   1794


 1   storage facilities; is that right?

 2        A      I'm not sure of your interpretation.                      I just

 3   know that it's just dry boat storage where the forklift

 4   picks up the boat and puts it into a slot.

 5        Q      Okay.     Well, I can show you that.                   Let's do

 6   this, so we make sure I'm not misrepresenting or

 7   misleading you.

 8               This is what's been previously identified as

 9   Ordinance 2003-16 creating the Riverfront Overlay

10   District.    Riverfront overlay -- do you see that there?

11        A      Yes, sir, I do.

12               MR. HEEBNER:           What exhibit is this?

13               MR. SHEPARD:           This is -- I don't know what it

14        is in order, but it's the Ordinance 2003-16.

15   BY MR. SHEPARD:

16        Q      Okay.     We're on Page 30 of 53.                    This is under

17   Permitted Special Exceptions.                  Have you seen this before?

18        A      Yes, sir.

19        Q      Okay.     Exception 3 is for a restriction on

20   what, boat storage or boat storage facilities?

21        A      Facilities.

22        Q      Okay.     Now, do we understand one another?                    When

23   I ask you whether the restriction is on dry boat storage

24   versus facilities, do you agree with me now that, per the

25   ordinance, it's on facilities?

                 Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons     1795


 1        A      Yes.

 2        Q      So you can have actual dry boat storage here,

 3   and there is storage here regarding the boatyard

 4   operation, correct?

 5        A      The present boatyard operation, there is open

 6   storage, yes, sir.

 7        Q      Okay.     Now, this ordinance, do you know when it

 8   was adopted?

 9        A      2003.

10        Q      Actually, it was January 7th, 2004, but you're

11   close.

12               Do you know when the Pacetta folks bought their

13   property?

14        A      2004 and 2006.

15        Q      And 2005?

16        A      Yes.

17        Q      Yes.    Okay.        These are all their properties,

18   right?

19               And just so my numbers are right on this board,

20   what you appraised is 1 and 10?

21        A      Yes, sir.

22        Q      Okay.     Did you appraise 2?

23        A      Yes, sir.

24        Q      Okay.     So is that a part of your number, too?

25        A      It is.

                 Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons    1796


 1          Q    What else is part of your number?

 2          A    That's all.

 3          Q    Okay.      So you didn't appraise 8, 9, 3 or 4?

 4          A    I'm not sure.            I don't -- I'm not familiar with

 5   your board.     I had the southern eight acres of

 6   residential land as my --

 7          Q    Okay.

 8          A    -- property.

 9          Q    So, if I understand correctly, the southern

10   eight acres, as has previously been identified, would be

11   10, 2 and 1, and obviously the record will speak for that

12   but that's what I understand it to be so hopefully we're

13   on the same page.

14               So the restriction on dry boat storage

15   facilities was in place before the Plaintiffs bought the

16   property?

17          A    I can't comment on that.

18          Q    Well, I just showed you the restriction and

19   you're familiar with the day.

20          A    You're -- you're pulling me around out of

21   context.    I don't -- I did not do anything up on that

22   end.

23               My focus was on the residential eight acres on

24   the south.     And I feel out of place commenting on dry

25   boat storage at this point.

                  Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons               1797


 1        Q    Well, I appreciate that very much, because, in

 2   your appraisal, as we discussed in length in your

 3   deposition, you said that it was critical or instrumental

 4   to the expressed value in your appraisal that the whole

 5   development, the whole development, had to be done for

 6   your values to have any merit; do you remember that?

 7        A    Yes.      Let me comment on that.

 8        Q    No, sir.         I just want to make sure you

 9   remember; we're on the same page.

10             It does say that here?

11             MR. HEEBNER:             He has a right to clarify his

12        answer.

13             THE COURT:           No, no.         You can clarify it on

14        redirect.

15   BY MR. SHEPARD:

16        Q    So your appraisal is based on an assumption

17   that all of this stuff can be done and your appraisal

18   says, if it isn't done, it doesn't have -- your appraisal

19   has no value, doesn't it?

20        A    No.     As I testified in my deposition, I'm not

21   sure what the implication would be.                        The residential

22   eight acres can easily stand alone without the northerly

23   commercial development.

24        Q    Okay.       Did you say that in your appraisal?

25   Sir, did you?

               Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons             1798


 1        A    The -- the appraisal considered the boat slips

 2   and for me, or anyone else, to have gotten the 106 wet

 3   boat slips, it required some mutual agreement with, I

 4   believe, the Town of Ponce Inlet or some other authority

 5   where I could get 106 wet slips on the eight-acre parcel,

 6   and it had a relationship to the parcel to the north.

 7             I'm not sure -- if they do not develop the

 8   parcel to the north, I just don't think it would have

 9   any -- any real bearing or merit or impact on the -- at

10   least the as-is value of the eight acres of land --

11        Q    Well, apparently --

12        A    -- residential land.

13        Q    Apparently, Mr. Marshall disagrees with you,

14   since he did the appraisal.

15             Would you look at Page 9 of the appraisal?

16        A    Yes, sir.

17        Q    The first hypothetical condition in this

18   appraisal, the second sentence:                  The land and building

19   improvements to the north -- to the north, that would be

20   the part we just talked about -- is considered

21   instrumental in the owner/developer's development plan

22   for a mixed-use riverfront development.

23             The next paragraph -- please publish the next

24   paragraph, the first two sentences, to your appraisal

25   that you're here to testify about.

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons             1799


 1             MR. HEEBNER:              Page 9?

 2   BY MR. SHEPARD:

 3        Q    Page 9, the second paragraph, under

 4   Hypothetical Condition.              It starts with "the subject

 5   property."

 6        A    The subject property as a stand-alone entity is

 7   not a profitable economic venture.

 8        Q    Stop right there.

 9             The stand-alone entity, per your testimony, is

10   this property here and the slips.                       That is what you were

11   appraising; that is what you mean when you say the

12   stand-alone entity?           That's what you testified to and

13   that's what's in your appraisal, correct?

14        A    No.

15        Q    That's not what you testified to?

16        A    That's not -- that's not what that meaning is

17   at all.

18        Q    Okay.

19        A    That's just talking about the 106 wet slips.

20   It's not talking about the land at all.

21        Q    The subject property is what the appraisal

22   talks about.     Let's identify, so we know -- I thought we

23   already did -- this is the subject property?                      Yes or no?

24        A    Yes.

25        Q    There's a paragraph that starts off by saying:

                  Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons               1800


 1   The subject property, as a stand-alone entity, is not a

 2   profitable economic venture?

 3        A     No.     That's not what it says at all.                    It's not

 4   a profitable economic venture as an independent 106

 5   wet-slip business operation; meaning, you're not going to

 6   use eight acres of prime residential land and ignore

 7   that, put in 106 wet slips, and have any kind of economic

 8   value.

 9        Q     Okay.

10        A     The real value is still in the land.                       It always

11   is going to be in the land.

12        Q     What is the next sentence?

13        A     The proposed 106 wet-slip construction project

14   may be profitable as part of the overall operation, only

15   controlled by the subject property owner, Mr. Lyder

16   Johnson.

17        Q     Okay.       So what -- your interpretation of Mr.

18   Marshall's work is that it doesn't -- it means something

19   different than what it appears to say; that all you're

20   worried about here, notwithstanding that it says "the

21   subject property," is that the wet slips are not

22   profitable without the residential?                         That's what the

23   testimony is today?

24        A     Well, yes.           The --

25        Q     Okay.

                Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons            1801


 1        A    -- wet slips are profitable as long as there's

 2   a residential component.

 3        Q    All right.         As we were going through the

 4   permitted uses over there, was that residential ever a

 5   permitted use on the property that you were appraising,

 6   ever?

 7        A    That particular plan?                  No, because the majority

 8   of it is zoned B-2.

 9        Q    Okay.     And so, under your highest-and-best-use

10   legal permissibility, wouldn't that have a disqualified

11   use from using this as a basis for your appraisal when

12   this has never been permitted as a residential piece?

13        A    Yes.    However --

14        Q    Okay.     That's good.             Yes is good.

15             THE COURT:         I'm going to --

16             (Simultaneous speaking.)

17             MR. HEEBNER:           Allow him --

18             THE COURT:         You're cutting him off.           You're

19        actually in trial.           Please don't do that.

20             Please finish the question.

21             THE WITNESS:           It would be -- based on a prudent

22        man rule, it would be anticipated that the Town of

23        Ponce Inlet would prefer residential development on

24        this site versus some type of commercial development

25        and I do believe that -- that all of the interviews

               Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons               1802


 1        that were conducted with the planners at the Town of

 2        Ponce Inlet indicated that it would be highly

 3        probable that they would allow a residential use.

 4   BY MR. SHEPARD:

 5        Q    All right.           Mr. Roper?

 6        A    Yes, sir.

 7        Q    Would you turn to Page 10 of the appraisal, the

 8   third paragraph from the top?

 9             It reads as follows:                   Therefore, my estimate of

10   the hypothetical prospective market value of the 106 wet

11   slips is subject to and contingent upon the

12   owner/developer legally building and developing the

13   proposed 106 slips per his representations.

14             Do you recall me asking you in your deposition

15   what the representations that you were relying on were?

16        A    I do.

17        Q    Would you please turn to Page 66, Proposed

18   Improvements?

19             All right.           Do these represent the

20   representations of the developer that were instrumental

21   to the values in your appraisal, per the wording that we

22   just published to the Court?                  Are these those

23   representations?

24        A    I'm not really certain.                      There's quite a bit

25   here.

               Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons                    1803


 1        Q      Are these the representations that you

 2   identified during your deposition as what that paragraph

 3   referenced?

 4               I'll be more than happy to let you look at your

 5   deposition.

 6        A      I -- here's the way that I would interpret your

 7   question.

 8        Q      My question has to do with what you told me --

 9               THE COURT:         You've got to let him finish the

10        question.      You're jumping him every time he answers.

11        Please let him finish his answer.                           He's trying to

12        get the question and answer.

13               Please, answer the question and then he'll ask

14        the next question.

15               THE WITNESS:           There are quite a number of

16        requirements for the developer to proceed and in

17        order to get a few more wet slips on the residential

18        acreage, there were probably some concessions that

19        were made by the developer on property to the north,

20        and that was the point that was trying to be made in

21        the appraisal process.                 We weren't trying to imply

22        that the entire mixed-use product had to be

23        developed all at one time.                    I don't think that could

24        even occur.

25               So, to answer your question, there may be some

                 Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons                   1804


 1        things that applied but others certainly wouldn't,

 2        and all of these listings on Page 66 look like an

 3        excerpt from some type of constraints that were

 4        applied to the Pacetta property.

 5   BY MR. SHEPARD:

 6        Q     Do you recall me taking your deposition on

 7   February 2nd, 2012?         This is Page 22.                    Do you recall

 8   that?

 9        A     Yes, sir.

10        Q     Okay.     Do you recall me asking you the

11   following question:         So, am I correct in concluding, when

12   this references -- and we're talking about the same

13   provision we just read aloud.

14              MR. HEEBNER:           Just show it to him, so he has an

15        opportunity to see the context.                       I can't even see

16        it.   I don't even have one.                   You've got mine.

17              THE COURT:         You're using his copy to impeach

18        his witness?

19              MR. SHEPARD:           Again, as I said to the Court, I

20        didn't expect him --

21              THE COURT:         No.      That's perfectly legally

22        permissible, but he -- I think he needs -- seems to

23        want to see it.

24              Off the record.

25              (Whereupon, an inaudible off-the-record

                Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons                1805


 1   discussion was held between counsel.)

 2   BY MR. SHEPARD:

 3        Q    Do you recall me asking you this question,

 4   Page 22, Line 18:

 5             "So am I correct in concluding, when this

 6        references to his -- Mr. Johnson's representations,

 7        at least in part, it's talking about what I find on

 8        Page 66 regarding what his plans were to build and

 9        develop legally?"

10             And your answer:              "Mr. Johnson is not only the

11        owner, but he's also a developer.                         And in the

12        appraisal process, as you know, especially for new

13        construction, the developer plays a large role in

14        the analysis and interaction with the appraisal

15        process."

16             Another question.

17             Next answer:           "So if Mr. Johnson can describe a

18        future condition and the number of wet slips and

19        it's supported by the construction plans and the

20        type of costs and all the activity that goes along

21        with a comprehensive new project, then it's

22        appropriate to rely upon the developer's opinion or

23        his information, because, oftentimes, there's an

24        absence of better or more informative data, if that

25        answers your question."

               Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons                 1806


 1              And I said:          "No.       It actually doesn't even get

 2        close.

 3              "What representations are being made -- are

 4        being referred to here that Mr. Marshall is relying

 5        on, on that -- that his appraisal is subject to?

 6        And, specifically, do those representations include

 7        those in the fine print on Page 66?"

 8              And your answer was:                 "I would say yes."

 9              Do you recall those questions and answers?

10        A     Yes.

11        Q     Okay.     And is that your answer today?

12        A     Yes.

13        Q     And these representations include the building

14   of the dry boat stack storage to the north and they

15   include the estate homes to the south and they include

16   the retail and commercial that you see along the

17   waterfront, don't they?

18        A     I don't want to leave you with the impression

19   that all of that has to be done for us to ascertain value

20   on the residential acreage.                If there are some

21   requirements placed on Pacetta for development elsewhere,

22   that's fine.   But the residential acreage value stands on

23   its own.

24        Q     Now, let me also be clear.                      The date of this

25   appraisal is March of 2009?

                Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons   1807


 1          A   June the 10th.

 2          Q   June the 10th, excuse me, I'm sorry.

 3          A   Yes, sir.

 4          Q   Was this appraisal done to determine the value

 5   or the impact of any specific regulation regarding the

 6   property and whether it was diminished in value by that

 7   regulation?   Was this appraisal done for that purpose at

 8   all?

 9          A   No, sir.

10          Q   Okay.     Was this appraisal done pursuant to the

11   Bert J. Harris Private Property Rights Act, Chapter 70 of

12   the Florida Statutes?

13          A   No, sir.

14          Q   Okay.     Would you turn with me to Page 84?

15          A   Yes, sir.

16          Q   Okay.     Would you publish to the Court the

17   second paragraph on this page?

18          A   As a vacant parcel of land, with no significant

19   physical constraints, located in Ponce Inlet, a wide

20   variety of possible uses would be available to the

21   subject property.       It is apparent from the zoning and

22   land use designations for the subject that the Town of

23   Ponce Inlet would like to encourage development that is

24   characterized by small-scale retail outlets and retain

25   and enhance those elements of the water-oriented

                Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons   1808


 1   commercial activity that can be integrated into a

 2   small-town fishing village concept, and that development

 3   within this area occurs in such a manner as to promote

 4   the open water-oriented character of the riverfront,

 5   protect environmental resources, and ensure a high

 6   quality of design as directed by the B-2, in paren, the

 7   majority of the property, close paren, and Riverfront

 8   Overlay District, respectively.

 9        Q    All right.         So that's a mouthful, but it talks

10   specifically about recognizing that development should be

11   characterized by small-scale retail, correct?

12        A    Yes, sir.

13        Q    A small-town fishing village concept, correct?

14        A    Yes.

15        Q    And it notes that the most -- the majority of

16   the property is B-2?

17        A    It is.

18        Q    Which doesn't permit multi-family, correct?

19        A    Yes.

20        Q    And it also notes the Riverfront Overlay

21   District, which we know does not permit the dry boat

22   storage facilities?

23        A    Yes.

24        Q    And you're aware, because of your extensive

25   research, that all of those restrictions were in place

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons               1809


 1   prior to the purchase of the properties?

 2        A    I'm not positive as to what constraints were

 3   applicable as of the dates that they bought the property,

 4   because I think there was some changes from '04 up

 5   through to the present.

 6        Q    Okay.        Your last sentence here, on Page 84, it

 7   talks about "this characteristic," and I believe the

 8   characteristic is, it's unique in nature with ample river

 9   frontage and water access.                 If I'm wrong in that

10   statement, please correct me, but I believe that's what

11   it's referring to when it means "this characteristic."

12   Am I right?

13        A    Yes.       That's fair.

14        Q    This characteristic, coupled with the land use

15   designation, indicates that marina-oriented, mixed-use

16   development, with a large commercial element, is logical

17   and feasible in the next two to three years or when the

18   economic conditions begin to improve.

19             So if I understand --

20             MR. HEEBNER:              There's no "or" in that text.             It

21        says:     When -- oh, I'm sorry.                     It says "or."   I

22        apologize.        Sorry.        Sorry.

23   BY MR. SHEPARD:

24        Q    So, if I'm reading this correctly, even I

25   should conclude from this appraisal that this project

                  Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons         1810


 1   that you appraised and put a value on really isn't going

 2   to be feasible at the time of the appraisal; that it

 3   might possibly be feasible in the next, quote, two to

 4   three years when economic conditions begin to improve?

 5         A     I think that's the implication.

 6         Q     Okay.     Did you know, or are you aware of,

 7   whether there was a restriction when the Plaintiffs

 8   bought the property on the expansion of existing marina

 9   uses?

10         A     I did not get into the -- much related to the

11   marina.

12         Q     Okay.     Well, you've been qualified as an expert

13   on the appraisal, and you certainly have testified now

14   about the importance of legal permissibility.

15               In the order of priorities in land use or

16   hierarchy, the Comp Plan is at the top of the heap, isn't

17   it?

18         A     Yes.    It seems to be the guiding material for

19   land use.

20         Q     So -- excuse me.              So if you were going to be

21   familiar with just one thing in a town, just one,

22   regarding importance of impacts on property, the Comp

23   Plan would be that thing, wouldn't it?

24         A     The land use plan.

25         Q     Okay.     The Comprehensive Land Use Plan?

                 Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons              1811


 1        A     Yes.

 2        Q     Now, I want to talk to you a minute about the

 3   MF-2 piece, because you testified also about moratoriums.

 4              You are aware that the moratoriums have never

 5   implicated, ever, Parcel 10, because it's MF-2; it's not

 6   in the riverfront commercial district, correct?

 7        A     No.     I believe it did and I'll tell you why.

 8   Parcel 10 was to be developed with just under 30 units

 9   and they had actually done the site work -- I don't know

10   if they poured the footers, but they did stabilize the

11   site for each and every of the individual townhouse

12   units.   And when they went back down to the City to get

13   permission for an alteration of the construction plans,

14   they were advised that they were now under a moratorium

15   and were not able to get a riverfront building permit or

16   something along those lines.

17        Q     Okay.       This is what somebody told you, right?

18        A     Yes.

19        Q     Okay.       And that's because of what, they needed

20   to provide access to the property?                        Do you have any other

21   understanding other than just what you've related to the

22   Court?

23        A     No.

24        Q     Okay.       Do you know whether at any time, when

25   there was no moratoriums on the property, Plaintiffs ever

                Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons                     1812


 1   applied for a small-scale amendment to the Comp Plan?

 2        A    No, sir.

 3        Q    Okay.     And these acreages combined, are they

 4   under 10 acres?

 5        A    They are.

 6        Q    Would they qualify for a small-scale amendment?

 7        A    That, I do not know.

 8        Q    Okay.     Do you know the minimum acreage under

 9   which you must -- the acres has to be under in order to

10   qualify for a small-scale amendment?

11             THE COURT:         He doesn't know.                  His last answer

12        was, "I don't know."

13             He's an expert.             You can ask him to assume

14        something, but I don't think you can ask him over

15        and over the same question.                   If you want to ask him

16        if he's -- whatever you want him to assume is true

17        and march on down the road.

18   BY MR. SHEPARD:

19        Q    Sir, let me make sure I understand, the

20   intended purpose of the appraisal that has been submitted

21   was for loan underwriting for Colonial Bank; is that

22   right?

23        A    Yes, sir.

24        Q    And it was not in any way intended to ever be

25   used in conjunction with another appraisal, for, to do

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons               1813


 1   so, would invalidate it?               Isn't that one of the

 2   conditions it states right in the appraisal?

 3         A    I do not understand that question.                       I'm sorry.

 4         Q    Okay.       If you would turn to Page 8, Limiting --

 5   General Limiting Conditions.                   It states, under

 6   Number 3 -- tell me when you're there.

 7         A    Yes, sir.

 8         Q    It states in the second sentence of Paragraph

 9   3:   The allocations of value for the land and

10   improvements must not be used in conjunction with any

11   other appraisal and are invalid if so used.

12              So, to the extent this appraisal is being

13   offered in conjunction with any other regarding the same

14   or related property, it would be invalid, according to

15   the general condition stated there, correct?

16         A    No.

17         Q    Okay.       So am I misunderstanding the condition?

18         A    Yes, sir.

19         Q    Okay.       Please explain.

20         A    It refers to unity of use.                        If I decide, during

21   the appraisal process, to complete a final value estimate

22   and re-distribute that between land and improvements --

23   let's just say I put 200,000 on the improvements and a

24   million on the land.            I can't go next door, appraise the

25   land parcel and assume that $200,000 would be applicable

                Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons             1814


 1   to those improvements.

 2             It actually holds that you can distribute --

 3   you can allocate and distribute the value of the whole

 4   property, but you can't use components of that

 5   distribution or allocation on other properties.                    And

 6   that's what Number 3 is for.

 7        Q    Okay.     So you're thinking, based on what you've

 8   testified today, that it would be okay to have an

 9   appraisal down here and an appraisal up here and here,

10   and, particularly when your appraisal specifically

11   references the properties to the north, it specifically

12   references those as a part of the deal, and that would

13   be -- trying to put those two together to get a total,

14   that would be okay?

15        A    No, that would not be applicable.                    That's

16   another -- that's also another rule, but it's not the

17   same as Number 3.

18             Number 3 is a distribution of a value of the

19   same property.    What you're talking about is different.

20        Q    Okay.

21        A    And that's -- you can't -- you can't segregate

22   components, put up individual values, and summarize

23   those, because usually the components would be greater

24   than the whole.     So it's either appraised in its entirety

25   or it's appraised in segments.                 You can do either one.

               Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons                 1815


 1        Q    I appreciate you correcting me.

 2             So if you took an appraisal for this property

 3   and then an appraisal for this property, you can't add

 4   them together for a total, can you?

 5        A    No.     It would be coincidental if the value

 6   would be, indeed, accurate.

 7             MR. SHEPARD:             All right.            Just a minute, Your

 8        Honor.

 9             Your Honor, at this time I have no further

10        questions for this witness subject to redirect, if

11        there is any.         But I do want to -- and we can do it

12        in the presence, if you want, or outside the

13        presence, as I promised I would, reassert an

14        objection to the use of the appraisal.                      I had no --

15             THE COURT:           The appraisal's already in

16        evidence.

17             MR. SHEPARD:             And I wanted to make now --

18             THE COURT:           You want to object to an exhibit in

19        evidence?

20             MR. SHEPARD:             Yes, Your Honor, because now I've

21        been able --

22             THE COURT:           Well, I take it, you'd probably

23        need to make a motion to take it out of evidence.

24             MR. SHEPARD:             Okay.       Then I'll make an ore

25        tenus motion.

               Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons         1816


 1             THE COURT:         Well, we're not going to do that in

 2        the middle of a witness.

 3             MR. SHEPARD:           That's -- I would be more than

 4        happy to do it when he leaves, but I said I would

 5        try to do that --

 6             THE COURT:         I'm going to -- I'm going to --

 7        I've never heard of one of those before.                  I'm

 8        anxious to see what the grounds are.

 9             But let's get -- finish this witness first.

10             Do you have any redirect?

11             MR. HEEBNER:           Briefly.

12                        REDIRECT EXAMINATION

13   BY MR. HEEBNER:

14        Q    Let me ask you again to go to --

15             THE COURT:         Other than Mr. Heebner's motion to

16        remove from evidence for mistake?

17             MR. HEEBNER:           Correct.

18             THE COURT:         That was my first one.

19   BY MR. HEEBNER:

20        Q    -- Page 66 of your appraisal, sir.

21        A    Yes, sir.

22        Q    And the date of this appraisal, which was

23   July 16th, 2009, was this a statement of Mr. Lyder

24   Johnson's proposed mixed-use development for this

25   property, the entire property?

               Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons     1817


 1        A     Yes, sir.

 2        Q     And does -- at the bottom, in fine print, does

 3   it detail the various mixed uses a fishing -- it's called

 4   a Ponce Preserve Mixed-Use Development, a Fishing Village

 5   Concept?

 6        A     Yes, sir.

 7        Q     And does it enumerate the other business

 8   activities on the property?

 9        A     It does.

10        Q     Does it provide for future marina development?

11        A     Yes, sir.

12        Q     Does it provide for future dry storage dockage?

13        A     Yes, sir.

14        Q     Does it provide for a public boardwalk and

15   retail facilities?

16        A     Yes, sir.

17        Q     Does it provide for a boatel facility?

18        A     Yes, sir.

19        Q     Does it provide for estate cottages?

20        A     It does.

21        Q     Let me ask you now to go over and review

22   page -- the same material that you've testified to on

23   Page 84.   I won't ask you to republish it, but, remember,

24   you talked about that:            The Town of Ponce Inlet would

25   like to encourage development as characterized by -- this

                Southern Reporting Company (386)257-3663
                       Non-Jury Trial Before Judge William A. Parsons       1818


 1   is Page 84.

 2        A      Okay.

 3        Q      And is that statement made by you, and

 4   including the development of page -- described on

 5   Page 66, entirely consistent with that mixed-use

 6   development that was proposed for the Town of Ponce

 7   Inlet?

 8        A      Yes.

 9        Q      Is there anything inconsistent in that

10   language?

11        A      No.

12        Q      Down at the bottom:                  This characteristic

13   coupled with the land use designation indicates that

14   marine-oriented, mixed-use development, with a large

15   commercial element, is logical and feasible in the next

16   two or three years or when economic conditions begin to

17   improve.

18               On the economic conditions to improve -- first

19   of all, is there any reason why some portion of this

20   property could not have been developed back at the time

21   that -- from an economic standpoint, that this property

22   could have been developed in 2009?

23        A      It could.

24               MR. HEEBNER:             We have no further questions.

25        Thank you.

                 Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons                1819


 1              THE WITNESS:           Excuse me, Your Honor, I have a

 2        correction to make, if I may.                      It pertains to the

 3        value I testified to earlier.

 4              MR. SHEPARD:           There's no pending question.

 5              THE COURT:         Any further questions?

 6   BY MR. HEEBNER:

 7        Q     One quick question.                Do you have any additional

 8   opinions relating to the value of the property?

 9        A     Yes, sir.        The -- I was asked earlier regarding

10   the as-is land value of the land.                     As of June the 10th,

11   2009, it was $10,920,000.              With the advent of 124 -- 106

12   wet slips it was $12,480,000.                 I overstated that amount

13   earlier.

14        Q     $12,480,000?

15        A     Yes.

16              THE COURT:         Give me again.               Give me that number

17        again.

18              THE WITNESS:           Yes, sir.           As is, as of June the

19        10th, the land value was $10,920,000.

20              THE COURT:         That's what you said before?

21              THE WITNESS:           Yes, sir.

22              Now, with the advent of the 106 wet slips, it

23        was $12,480,000.

24              THE COURT:         Total?

25              THE WITNESS:           Yes, sir, that's correct.

                Southern Reporting Company (386)257-3663
                 Non-Jury Trial Before Judge William A. Parsons              1820


 1        THE COURT:            12 million --

 2        THE WITNESS:              -- 480,000 dollars.

 3        THE COURT:            And that makes the slips worth

 4   what?

 5        THE WITNESS:              Five million, four hundred --

 6   well, wait a minute.

 7        MR. HEEBNER:              No, no.         That's where the error

 8   came in, right there.

 9        THE WITNESS:              Right.        That's where the error

10   came in.

11        THE COURT:            You're saying you take ten,

12   nine-twenty, from twelve, four-eighty and you get

13   the plug-in number?

14        THE WITNESS:              We have $7,080,000 in excess land

15   value and then we have 2.52 acres for the 106

16   wet-slip component, which is worth $5,400,000.                     That

17   gives us $12,480,000, assuming we have built 106 wet

18   slips out front.

19        MR. HEEBNER:              I'm missing your addition.         You

20   got --

21        THE WITNESS:              It works.

22        MR. HEEBNER:              If the land value's ten million,

23   nine-twenty and you have an additional value of

24   five-four, the docks --

25        THE WITNESS:              No.      That's not an additional

             Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons             1821


 1        value.   That is the docks plus an allocation of

 2        2.52 acres of the eight acres.

 3             So what we have here is, we have $7,080,000

 4        worth of unimproved land, plus 2.52 acres of land

 5        area to be utilized for residential purposes, plus

 6        the 106 wet slips worth $5,400,000, for a total

 7        value of $12,480,000.

 8             That's the value of the eight acres of land,

 9        plus the anticipated 106 wet slips, as if they were

10        completed and ready for sale.

11   BY MR. HEEBNER:

12        Q    Does that ten million, nine-twenty on land

13   value include that land value as improved --

14   proposed-to-be improved by Pacetta?

15        A    No.     That is as-is.

16        Q    That's raw acreage?

17        A    That is raw acreage.                   That is the total value

18   of the 7.96 gross acres raw.                  $10,920,000 without putting

19   a space in the ground.

20        Q    Did you ever calculate the additional value

21   created by the proposed multi-family?

22        A    Not in this case, no, sir.

23        Q    Okay.       Have you done so in any other case?

24        A    Many cases.

25        Q    Did you -- is it fair -- is it a fair question

               Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons                   1822


 1   to ask you, whether or not you have an opinion of value

 2   of those units as of July 16th, 2009?                           If it's not fair,

 3   tell me.   That's okay.

 4        A     I don't want to render an opinion on it.

 5              MR. SHEPARD:           Your Honor --

 6              MR. HEEBNER:           That's fine.             Thank you.

 7              THE COURT:         Additional questions?

 8              MR. SHEPARD:           No additional questions, Your

 9        Honor.

10              THE COURT:         Okay.        Can this witness be excused?

11              MR. HEEBNER:           He can.

12              THE WITNESS:           Thank you, Your Honor.

13              THE COURT:         Thank you.            You may step down.

14              THE WITNESS:           Thank you, sir.

15              (Whereupon, the witness left the stand.)

16              MR. SHEPARD:           Your Honor --

17              THE COURT:         Just let him leave, Counsel.

18              Mr. Shepard, the witness has left the room.                          I

19        think you have either a further objection or a

20        motion you want to make?

21              MR. SHEPARD:           Yes, I do, Your Honor.                I'd like

22        to move, again, to exclude the exhibit, which is the

23        Clayton, Roper, Marshall appraisal.

24              And we now have the predicate, at least as it

25        regards the Bert J. Harris, and that's why this

                Southern Reporting Company (386)257-3663
                Non-Jury Trial Before Judge William A. Parsons            1823


 1   ruling is important, because not knowing how this is

 2   going to come out -- concerned about how it may come

 3   out, but not knowing how it's going to come out, I

 4   want to be clear on what is being offered for what

 5   purpose.

 6        This appraisal, according to the appraiser

 7   himself, was not done in accordance with the Bert J.

 8   Harris Act.       It didn't appraise any of the

 9   regulations that are being complained about as

10   inordinately burdensome.

11        So, despite all of his opinions about the

12   property being inordinately burdened, this appraisal

13   doesn't appraise any of these things and that's what

14   the statute asks for.

15        So, first, talking about Bert J. Harris, it has

16   no relevance as to that issue of inordinate burden

17   or as to the damages available under the Act.

18        So that's the argument as to that.                     And if it's

19   excluded as to that purpose, but it's included for

20   the takings purpose, then at least I would

21   understand where we are in terms of what is being

22   offered for what purpose.

23        And I have an argument about the takings, as

24   well, but I want to make sure that I don't go before

25   you're ready.

          Southern Reporting Company (386)257-3663
                Non-Jury Trial Before Judge William A. Parsons                   1824


 1        THE COURT:           Okay.        It's already in evidence.

 2        MR. SHEPARD:             It was, and I made the argument

 3   at the time for the same reason.                            It was not a part

 4   of a Bert J. Harris claim and it did not -- even if

 5   the Court accepts the argument of Plaintiff, that

 6   there was some sort of a continuing claim based upon

 7   his letters to me, this appraisal, nor any other,

 8   accompanied those letters, which the statute says it

 9   must do.

10        So, even if you can make the assumption that

11   there is such a thing as a continuing claim based on

12   regulations that have never been appraised or

13   evaluated, this, A, doesn't appraise any of those

14   regulations at all, and it's been cleared by the

15   witness that it doesn't.                  It was never presented

16   with those, quote, continuing claims.

17        THE COURT:           I mean, at this point in time, it's

18   being offered in the case.

19        MR. SHEPARD:             But there are four different

20   counts, and so --

21        THE COURT:           Yeah, but -- so, if it's relevant

22   for any, it gets admitted in evidence.

23        MR. SHEPARD:             I understand that.                I'm just

24   not --

25        THE COURT:           Whether it turns out to be valid

          Southern Reporting Company (386)257-3663
               Non-Jury Trial Before Judge William A. Parsons       1825


 1   notice or valid compliance with the Harris Act under

 2   the requirement of a written submission, that's for

 3   me to decide, I suspect, at later time.

 4        MR. SHEPARD:            Well, that's -- that's what I'm

 5   trying to get at too.

 6        THE COURT:          I think it -- I think it has to

 7   be -- I mean, if a piece of evidence is relevant for

 8   any purpose it comes into evidence during the trial.

 9   I mean, you can have 45 claims and, if it's relevant

10   for Claim 45 and has no bearing on 1 through 44, it

11   gets admitted in the trail.

12        If -- in your case, you're saying that the

13   appraisal, it doesn't matter, really, so much what

14   it says, is it submitted as compliance with the

15   claim requirement?            It's a pre-suit requirement,

16   really.

17        And you're saying, if that was required, it

18   didn't comply and, therefore, the claim's no good?

19        MR. SHEPARD:            That's -- that's part of what I'm

20   saying.   That's correct.

21        THE COURT:          But that doesn't make it

22   inadmissible in the trial.

23        MR. SHEPARD:            I'll address the Count I argument

24   as well, but it's important for me to know, in terms

25   of what the Court is doing on a go-forward basis,

          Southern Reporting Company (386)257-3663
                 Non-Jury Trial Before Judge William A. Parsons                  1826


 1   whether it's going to consider this appraisal as in

 2   support of the Bert J. Harris claim --

 3        THE COURT:            Well, I'm not going to tell you

 4   that.     I'm only trying to decide whether it's

 5   admissible.

 6        MR. SHEPARD:              All right.

 7        THE COURT:            I mean, you want me to give a

 8   partial directed verdict now?

 9        MR. SHEPARD:              No, sir.          That's not what I'm

10   asking, sir.         I understand.

11        THE COURT:            I'm not going to do that in pieces,

12   if at all.

13        MR. SHEPARD:              And then, as to Count I, which is

14   the takings claim, the appraisal was offered for a

15   loan valuation.            It was not offered in the

16   context -- in any way, shape or form, in the context

17   of a takings claim and it does not --

18        THE COURT:            I mean, when a bank gets an

19   appraisal for a property, they're trying to evaluate

20   the value of their security.                       I mean, they get a

21   mortgagee policy which converts upon -- upon

22   foreclosure to an owner's policy.                            They're trying to

23   evaluate the value of the property for purposes of

24   what their security would be worth.

25        MR. SHEPARD:              Correct.

             Southern Reporting Company (386)257-3663
                Non-Jury Trial Before Judge William A. Parsons             1827


 1          THE COURT:         There's no difference.

 2          MR. SHEPARD:           And -- well, there is a

 3   difference in this case, because the appraisal that

 4   is being -- is being offered to support -- again,

 5   we're not in the damages phase, so what relevance is

 6   it?    The relevance --

 7          THE COURT:         Well, he's got to show there's a

 8   taking.

 9          MR. SHEPARD:           Which happens based on

10   regulations, not based on appraisals.

11          THE COURT:         But, I mean, let's suppose you have

12   regulations and there's no change in value.                      Is

13   there a taking?

14          MR. UPCHURCH:           Let's suppose you've got a whole

15   set of regulations and they get up one morning and

16   they change them all.                The property was worth a

17   hundred dollars before; it's worth a hundred dollars

18   now.    Is there a taking?

19          MR. SHEPARD:           I think that helps frame the

20   argument.      Here's the value in a vacuum that isn't a

21   before or after on anything.                      It is a snapshot of a

22   point in time that doesn't evaluate anything

23   relative a -- as you said, it is -- well, if it

24   never changed --

25          THE COURT:         It's after, isn't it?

            Southern Reporting Company (386)257-3663
                 Non-Jury Trial Before Judge William A. Parsons                  1828


 1        MR. SHEPARD:              After what?             That's the point.

 2   After what?

 3        THE COURT:            I mean, it seems to me it's

 4   relevant.       It has some relevancy.                       It depends on how

 5   this whole thing is construed, but it's relevant as

 6   to the value of the -- I mean, he basically

 7   appraised the value of the land.

 8        MR. SHEPARD:              At a point in time but not

 9   relative to any regulations that are in play here.

10        THE COURT:            Well, I -- I don't see it like

11   that.

12        MR. SHEPARD:              Okay.       I understand, Your Honor.

13        THE COURT:            I'm not -- I'm not ruling -- by

14   allowing it in evidence, I am not ruling that it is

15   a meritorious appraisal for purposes of the Harris

16   claim.     I'm just -- I've not been asked to rule on

17   that.

18        I've really been asked to decide if the

19   Plaintiff, who wants to prove a claim, can

20   demonstrate that the piece of evidence has some

21   relevant value for the Court, should the Court have

22   to find fact in this case, and I find that it does.

23   Which is what I found earlier and nothing has

24   changed.

25        So your motion to withdraw the exhibit, or to

             Southern Reporting Company (386)257-3663
                 Non-Jury Trial Before Judge William A. Parsons           1829


 1   have me partially rule on a motion for direct

 2   verdict in advance of the normal -- of the

 3   Plaintiff's finishing his case, is denied.

 4          MR. SHEPARD:            I understand, Your Honor.        Thank

 5   you.

 6          THE COURT:          Next witness, please.

 7          MR. HEEBNER:            Mayor Nancy Epps.

 8          THE COURT:          Are are we into Friday yet?

 9          MR. HEEBNER:            We're close.

10          THE COURT:          You said noon tomorrow, right?

11          MR. HEEBNER:            I will be done.

12          MR. SHEPARD:            He said noon today.

13          THE COURT:          Huh?

14          MR. SHEPARD:            He had said noon today.

15          MR. HEEBNER:            No.      I said noon -- noon today,

16   three days ago.

17          THE COURT:          No.      The last was noon tomorrow.

18          MR. HEEBNER:            It is noon tomorrow.

19          THE COURT:          Has that slipped at all?

20          MR. HEEBNER:            No, no.

21          THE COURT:          Okay.        It feels like it's slipping.

22          MR. HEEBNER:            No.

23          THE COURT:          Okay.        That's all right.    It's good

24   news.

25          Swear the witness, please.

             Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons                      1830


 1               (Whereupon, the witness was sworn in by the

 2   clerk and responded "I do" to the oath.)

 3   WHEREUPON,

 4                               NANCY ELAINE EPPS

 5         having first been duly sworn, was called as

 6                 a witness and testified as follows:

 7               THE COURT:          Now, one of the things the Court

 8        consider -- the system is considering is creating a

 9        division for complex litigation.                             Convincing me, I

10        never need to apply for that.

11               MR. HEEBNER:            May it please the Court?

12               THE COURT:          You may proceed.

13                             DIRECT EXAMINATION

14   BY MR. HEEBNER:

15        Q      Would you please state your full name and

16   current address?

17        A      Nancy Elaine Epps, 127 Old Carriage Road, Ponce

18   Inlet, Florida.

19        Q      Would you spell your last name for the court

20   reporter?

21        A      E-P-P-S.

22        Q      Just briefly, would you state your educational

23   background?

24        A      I have a Bachelor's degree in medical

25   technology and a Master's degree in business

                  Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons              1831


 1   administration.

 2             THE COURT:         Where from?

 3             THE WITNESS:           The University of Colorado,

 4        Colorado Springs.

 5             THE COURT:         University of Colorado?

 6             THE WITNESS:           Uh-huh.

 7             THE COURT:         That's your undergraduate?

 8             THE WITNESS:           That was my graduate degree.

 9             THE COURT:         Graduate degree?

10             THE WITNESS:           My graduate degree.

11             THE COURT:         Both of them?

12             THE WITNESS:           No.      My undergraduate was from

13        Bethune-Cookman.

14             THE COURT:         Okay.        Bethune-Cookman and then the

15        University of Colorado?

16             THE WITNESS:           Correct.

17   BY MR. HEEBNER:

18        Q    Would you briefly, again, give us your work

19   experience since you graduated?

20        A    I have always been a medical technologist.                  I

21   started working at Halifax Hospital directly after my

22   training and have been at several hospitals since then.

23             I'm currently the laboratory director at Bert

24   Fish Medical Center in New Smyrna Beach.

25        Q    And what is a medical technologist?                  Is that --

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons                    1832


 1          A    It's a lab tech.

 2          Q    A lab tech?

 3          A    For lay people.

 4          Q    I gotcha.

 5               Have you been -- you're now employed with Fish

 6   Memorial, Fish Hospital, in New Smyrna --

 7          A    Bert Fish Medical Center.

 8          Q    Bert Fish Medical, I'm sorry.                         Thank you very

 9   much.

10               And you're currently a member of the Town of

11   Ponce Inlet?

12          A    I am a resident.

13          Q    And have you been -- I'm sorry, a resident,

14   yes.    Things will slip.            We're late in the day.               I

15   apologize.

16               Okay.      You are now, currently, a resident of

17   Ponce Inlet?

18          A    Correct.

19          Q    How long have you been a resident of Ponce

20   Inlet?

21          A    Since 1998.

22          Q    When did you become the mayor of Ponce Inlet?

23          A    2005.

24          Q    Were you on the Council prior to that?

25          A    Yes.

                  Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons             1833


 1        Q      Were you present during the visioning processes

 2   that took place in 2002, 2003, 2004?

 3        A      Yes.

 4        Q      I'm sorry.          You become mayor in '04?

 5        A      '05.

 6        Q      '05, okay.

 7        A      I was on the Council from -- the previous three

 8   years.

 9        Q      Okay.

10               THE COURT:          I'm sorry.            You were mayor from

11        when to when?

12               THE WITNESS:            2005 to 2008.

13               THE COURT:          And then you were on the Council

14        from?

15               THE WITNESS:            2002 to 2005.

16               THE COURT:          Thank you.

17   BY MR. HEEBNER:

18        Q      His Honor and this Court have heard all the

19   detailed facts on this case regarding the evolution of

20   this project.

21               Are you familiar, generally, with the Pacetta

22   property?     And I'm going to show you a mixed-use

23   development here of this property.

24               Is this the property you generally understand

25   to be the Sailfish property, the Old Florida Club, Down

                  Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons               1834


 1   the Hatch and the proposed boat storage facility?

 2        A    Yes, it is.

 3        Q    Okay.     When did you first become aware that any

 4   portion of this property had been acquired?

 5        A    I believe it was 2000 -- late 2005 or early

 6   2006.

 7        Q    Okay.     What was the physical condition of these

 8   properties in '05 and '06?

 9        A    Well, it was largely undeveloped.                    The south

10   end had had old, old houses that had since been torn

11   down.

12             The Old Florida Club was still there at the

13   time, and it was okay.           The Down the Hatch was okay.           The

14   Docksider was in disrepair, I would say.

15        Q    Okay.

16        A    And the boatyard was there.

17        Q    Okay.     And you've been a resident for how long?

18        A    Twelve years.

19        Q    And in that period --

20        A    No, 14 years.           Sorry.

21        Q    Fourteen years.

22             And based on your observation, has this area

23   here always been used for boat storage and boat repair?

24        A    Yes, and long before I was a resident.

25        Q    Okay.     When did you first become aware of the

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons               1835


 1   working waterfront legislation by the legislature of

 2   Florida?

 3        A     I believe it was 2005.                     It may have been

 4   earlier than that.          I'd have to look back in my

 5   documents.

 6              But I am a boater.                  And so the ability to haul

 7   a sailboat was always important to me, locally.                      And it

 8   came -- it became known to me that a lot of the boatyards

 9   in the state -- well, along the whole entire coast --

10   were being purchased by developers for the purpose of

11   turning them into, primarily, condominiums, businesses

12   other than boatyards and, therefore, we were losing a lot

13   of our ability to have a facility nearby -- not, "we,"

14   specifically, as in the town, but up and down the coast.

15              And I thought that there was an economic risk

16   there to the marine economy.

17        Q     And did you become a proponent, as a member of

18   the Town Council and the mayor, for the Town's adoption

19   of a working waterfront legislation?

20        A     I did.

21        Q     And in the course of that advocacy, if you

22   will, did you have the opportunity to meet with Mr. Lyder

23   Johnson and/or his team regarding the potential

24   development of this area?

25        A     As part of the general overall plan, yes.

                  Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons               1836


 1        Q    Okay.     When did the possibility of a mixed-use,

 2   overall development of this property become known to you?

 3        A    It was early in their plans.                         It wasn't

 4   immediately after they acquired the first piece of

 5   property, because they didn't have ownership of that

 6   piece at the south end at the time.

 7             But after they acquired it, we started having

 8   discussions with them -- the Town started having

 9   discussions with them of what we would like to see there

10   and, you know, what they would present back to us as

11   their proposal.

12        Q    Would you consider, at that point in time, that

13   process to be quite collaborative?

14        A    Yes.

15        Q    Did the Town, through its planning staff and

16   the Town Council, give their input to the planning staff

17   and to Mr. Lyder Johnson what they wanted?

18        A    It was very much a give-and-take.

19        Q    And what is it that the Town was really looking

20   for in broad terms, you know, from the visioning

21   statement and all the things?

22        A    Right.     Oh, preservation of the history,

23   preservation of the working waterfront, citizen

24   amenities, things that would benefit the citizens, and

25   the business owner, obviously, would have to collaborate

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons              1837


 1   with us on what that would be.

 2             We wanted to make sure that there was access

 3   for the public to the waterfront and --

 4        Q    Access to the waterfront area?

 5        A    Yes.

 6        Q    Did the Town, during this time frame, encourage

 7   Mr. Johnson to create a joint or a unified ownership of

 8   this property, so a unified multiple-use project could be

 9   developed?

10        A    We did.         We discussed a planned waterfront

11   development, which one, of course, had to have all been

12   under one owner.

13        Q    And so did Mr. Johnson or, again, the term,

14   Pacetta, LLC, begin purchasing these properties?

15        A    Yes.

16        Q    Do you know when he completed the purchase of

17   the properties?

18        A    Sometime in 2006, I'm pretty sure.

19             MR. JOHNSON:              It's right behind you, Pete.

20             MR. HEEBNER:              That's all right.

21   BY MR. HEEBNER:

22        Q    Now, just for a quick shot here.                        Are we

23   talking about the same property?                      This is the Sailfish

24   property, which was residential and, at this point in

25   time, vacant?

                  Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons   1838


 1        A    Yes.

 2        Q    Okay.     This is the Hurd property and the

 3   Fornari property.

 4        A    Right.

 5        Q    Were you on the Council when these properties

 6   were taken out of the ROD and a small Comp Plan amendment

 7   made to allow residential here?

 8        A    Yes.

 9        Q    It was rezoned from B-2 to R-3?

10        A    Yes.

11        Q    Now, based on your observations of the Town and

12   your discussions with Lyder Johnson, did you feel like

13   the B-2 zoning was appropriate for that parcel?

14        A    I had some discomfort about having

15   single-family residential abut right up to commercial.

16        Q    Okay.     Did your planning staff ever recommend

17   to you that, perhaps, a more appropriate use of this

18   property would be residential?

19        A    Yes.

20        Q    Okay.     In fact, during the course of the

21   proceedings of the development of this project, did you

22   ever hear anybody object to the potential residential use

23   of this, ultimately, eight acres?

24        A    Not that I recall.

25        Q    Now, if you -- do you know if Mr. Peter Grigas

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons        1839


 1   of your planning staff -- could you describe who he was?

 2        A    He was our planner -- years? -- I believe from

 3   the time I got on Council until -- no, it was a little

 4   after I became a council member and for several years

 5   following.

 6        Q    Okay.        And did you believe and understand that

 7   he was collaborating with the developer to develop this

 8   mixed-use project here?

 9        A    Yes.

10        Q    And was this mixed-use project provided to the

11   Town Planning Staff -- Planning Board and the Town

12   Council for review?

13        A    Planning first.                They did the first reviews.

14   Then, via the Planning Commission, the Council saw them.

15        Q    Okay.        And do you recall this drawing,

16   generally, being -- before '06, generally, being

17   available as a presentation in the Down the Hatch

18   restaurant?

19        A    Oh, yes.

20        Q    So, again, the dry-stack storage, and its other

21   amenities here, were well known to the population of the

22   Town of Ponce Inlet in '05?

23        A    If they were paying attention.

24        Q    Okay.        That's fair.

25             When did you first become aware of an ROD?

                  Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons                      1840


 1        A      We discussed it as part of our Comp Plan

 2   Amendment in 2003, so I know I was aware of it then.

 3        Q      And were you aware there was a prohibition in

 4   the ROD for the dry-stack storage?

 5        A      Yes.

 6        Q      Now, how were you, as the Town Council, going

 7   to overcome those issues in order to get the mixed-use

 8   development that you wished?

 9        A      Well, the plans can always be changed.                          You can

10   take that restriction out of the ROD.                            At the time that

11   we put them in the ROD, we had not adopted the working

12   waterfront or the Manatee Protection Plan -- five to

13   zero, I might add -- that then shed a whole new light on

14   what we would want on that property, in my opinion.

15        Q      Now, at the time that they first discussed this

16   overall development of this property, was there a zoning

17   classification that would allow for it?

18        A      Allow for?

19        Q      The overall mixed-use development of this

20   property?

21        A      There was a zoning classification.                         It wasn't

22   on that property at the time, but, yes, there was an MF-2

23   zoning category.

24        Q      Right.     But would this not require some form of

25   a PUD-type zoning to accomplish the mixed use that

                 Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons           1841


 1   straight zoning would not allow?

 2        A     It was preferable.                And we -- that's what we

 3   called the Planned Waterfront Development.

 4        Q     The PWD?

 5        A     There was a specific name, but it was a PUD.

 6        Q     And there was a POD [sic] but, ultimately, to

 7   be substituted for the ROD for the purposes of allowing

 8   this mixed-use development here?

 9        A     Well, that was my intention.

10        Q     Okay.     And the ROD encompassed only the lands

11   of Pacetta?

12        A     I think there's one little corner that touches

13   a property on Sailfish, but, primarily, it's just

14   Pacetta.

15        Q     And in the presentation to the Town Council,

16   did Mr. Johnson and/or his advocates, that is, Mr.

17   Momberger and Mr. Allen Watts, or whatever, indicate that

18   the dry-stack storage was the engine, the economic

19   engine, that would allow him to provide these other

20   amenities to the town?

21        A     Yes.    That was a component certainly.              There

22   were things that we asked for that we knew would not be

23   self-supporting and so he said, Well, this would help

24   allow us to do those businesses that really aren't going

25   to make any money.

                Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons                    1842


 1        Q    Okay.      Now, did the Town then embark on a

 2   large-scale amendment to its Comprehensive Land Use Plan?

 3        A    Yes.

 4        Q    And did that include the addressing of the

 5   working waterfronts as mandated by the Florida

 6   legislation?

 7        A    It did.

 8        Q    And was that process in developing that Comp

 9   Plan a collaborative one between the Town and Mr. Johnson

10   and Pacetta and his individual consultants?

11        A    Yes.

12        Q    It was a good give-and-take?                          I mean, it was

13   collaborative?     It was friendly?                 A win-win situation?

14        A    In my opinion.             It started with Planning, of

15   course, and then came to us.

16        Q    The Comprehensive Land Use Plan that would

17   allow for this development, was it transmitted to the

18   Town Council from the Planning Board?

19        A    Yes.

20        Q    And do you recall why the Town Council then

21   withdrew that process from -- and the LPA authority from

22   the Planning Board?

23        A    There were some recommendations from Council

24   because there was some concern that there had -- some

25   Sunshine discussions -- well, some discussion that could

               Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons       1843


 1   have resulted in a Sunshine Violation, if we had sent it

 2   back to them for further review.

 3        Q    And under whose recommendation was that made

 4   that you remove the LPA power from the Planning and

 5   Zoning Board?

 6        A    Virginia Cassady was our attorney at the time.

 7        Q    And did the Town Council then embark on their

 8   own review of the Comp Plan, at that point in time,

 9   acting as the LPA?

10        A    Yes.

11        Q    And did that process continue through

12   December -- through the first part of 2008?

13        A    It continued through the latter part of 2008.

14        Q    Okay.       When did the issue of a referendum first

15   appear?

16        A    I'm not positive.                 It might have been the

17   spring of 2008.

18        Q    Do you recall an ordinance that was approved by

19   the Town requiring a supermajority for a modification to

20   the Comp Plan?

21        A    Yes.

22        Q    And who instigated that document?

23        A    Gary Comfort, I'm pretty sure.

24        Q    Now, who were the principal opponents to the

25   Pacetta property in late -- or in the summer of 2008?

               Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons   1844


 1        A    Well, I think it was initiated by some

 2   residents on Sailfish and Bounty Lane that -- they were

 3   the primary movers that -- with the petition and

 4   Mr. Comfort.

 5        Q    Okay.      Would Barbara Davis be one of those?

 6        A    Yes.

 7        Q    Was Robyn Hurd?

 8        A    Yes.

 9        Q    Kris Derr?

10        A    Yes.

11        Q    Now, they were then successful to get the

12   referendum on the ballot?

13        A    Yes.

14        Q    And did you have several opportunities to

15   transmit on second reading the -- what's called the

16   favorable amendments to the Comp Plan?

17        A    We had at least one opportunity.

18        Q    Okay.      And why did the Council not transmit on

19   second reading the favorable amendments to the Comp Plan

20   to the Department of Community Affairs?

21        A    Well, at that point we were aware that the

22   charter amendment petition was on the ballot, and Council

23   advised us that if we accepted the second -- on second

24   reading, the Comp Plan, as we had written it, including

25   the dry boat storage, that, if the petition passed in

               Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons            1845


 1   November, then we would be -- we would have a chartering

 2   conflict with the Comp Plan and that would be a mess.                     It

 3   would -- obviously, something would have to be revisited.

 4               And there was knowledge there might be an

 5   appeal of the charter amendment, but nobody knew which

 6   way it was going to go.

 7               So it was my opinion that we were well advised

 8   to wait until after the petition had been decided by the

 9   citizens.

10        Q      Let me take you back to '07 again.                   I'm sorry,

11   November of '07.

12               Was there a one-year moratorium imposed on the

13   Pacetta property at that time?

14        A      Yes.

15        Q      In your view, the practical impact of that

16   moratorium only impacted the properties of Pacetta?

17        A      Yes.

18        Q      At the same time, you were also going through

19   the aggregation review of the Manatee Protection Plan?

20        A      Correct.

21        Q      Was the Town implementing the Manatee

22   Protection Plan as required by the State and by the

23   County?

24        A      Yes, we were.

25        Q      And did you ultimately allocate certain slips

                 Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons   1846


 1   to certain properties in the town using the aggregation

 2   method?

 3          A     We did.

 4          Q     Did you understand what the aggregation method

 5   was?

 6          A     Yes.

 7          Q     Describe it for us.

 8          A     Drive it?

 9          Q     Describe it.           Describe it.

10          A     We had a measurement of the entire coastline of

11   the town that could have docks and, obviously, not the

12   ocean.     And we did have some determinations made, because

13   we do, in fact, own all the way over to US-1, that the

14   barrier islands wouldn't be included, the US-1 border

15   wouldn't be included.

16                So we then divided it up into the amount of

17   space that we thought was needed for a slip at a

18   property.     And out of the -- the footage of the

19   shoreline, we then decided how many slips could be

20   possible, and that was our aggregate number from which

21   each property was assigned a certain number of boat

22   slips.     And we kept a pool also.

23          Q     A reserve pool?

24          A     Yes.

25          Q     Now, did that -- when you and the Town Council

                  Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons   1847


 1   passed that ordinance, was your intentions that, by

 2   providing a certain amount of dry slips and a certain

 3   amount of wet slips to Pacetta, that they could place

 4   those anywhere on their property or aggregate them in

 5   certain places, obviously consistent with other rules and

 6   regulations of the town?

 7        A    Right.

 8        Q    We've heard testimony that we -- may hear

 9   testimony that we could only have, like, 15 slips here

10   and 10 here and two there and four here and six there and

11   one there.

12             Is that anywhere near the legislative intent of

13   the Town Council in providing those slips to Pacetta?

14        A    Not really.             That was something that would have

15   come out in the entire plans, what -- what would go

16   where, but certainly not at the time that the aggregate

17   was established.

18        Q    I understand.

19             And are you aware that in order to master plan

20   this property under a PWD it requires unified ownership

21   of the property?

22        A    Yes.

23        Q    And you're aware that the properties are owned

24   in some parts by two corporations that are wholly owned

25   by Pacetta?

                  Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons   1848


 1          A   Yes.

 2          Q   And was ever -- until 2008, was there ever an

 3   issue that this property was not in unified ownership

 4   under your zoning and planning regulation?

 5          A   Not to my -- not in my view.

 6          Q   Now, in 2008, the fall of 2008, were you then

 7   running for the Volusia County Council?

 8          A   I was.

 9          Q   Okay.     And you were then -- your term was going

10   to end in November of '08 after the election?

11          A   Correct.

12          Q   Now, who got elected to the Town Council in

13   '08?

14          A   Barbara Davis, Kris Derr and Tami Lewis.

15          Q   And was Tony Goudie elected as mayor?

16          A   Yes.

17          Q   Were at least three of these -- four of these

18   individuals avowed opponents to the Pacetta project?

19          A   Yes.    You know, I'm not sure about Tami Lewis.

20   Somehow that's not sounding right.

21              It was Barbara Davis and Kris Derr.

22              THE COURT:         Barbara Davis and who else?

23              THE WITNESS:           Kris Derr, D-E-R-R.

24   BY MR. HEEBNER:

25          Q   It wasn't Tami Lewis?

                Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons          1849


 1        A    No.

 2        Q    It was Jack Sturno and --

 3             MR. UPCHURCH:             Goudie, Derr, McCormick and

 4        Davis.

 5             MR. HEEBNER:             Yeah, and McCormick, okay.

 6             THE COURT:           I'm sorry, Barbara Davis, Mr.

 7        Goudie --

 8             MR. HEEBNER:             Tony Goudie.

 9             THE COURT:           -- and Mr. --

10             MR. HEEBNER:             And Kris Derr.

11             THE WITNESS:             Right.        And McCormick and Sturno

12        were still members in 2008.

13             MR. UPCHURCH:             (Inaudible), McCormick, Goudie,

14        Epps and Sturno.

15             THE WITNESS:             Before that.

16   BY MR. HEEBNER:

17        Q    Yeah, before that.

18             So the County Council then looked like Mayor

19   Goudie, an opponent?

20             THE COURT:           City Council.

21             MR. HEEBNER:             City Council.

22             THE WITNESS:             Town, yeah.

23             MR. HEEBNER:             I'm sorry.

24             THE COURT:           Okay.

25

               Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons             1850


 1   BY MR. HEEBNER:

 2        Q    Town Council to be more appropriate.

 3             Tony Goudie is the mayor, an avowed opponent of

 4   the project; is that correct?

 5        A    Yes.

 6        Q    You have Kris Derr, an avowed opponent of the

 7   project, and one of the major proponent of the

 8   referendum?

 9        A    Right.

10        Q    You have Barbara Davis, who was an avowed

11   opponent to the project and was one of the advocates for

12   the referendum project?

13        A    Right.

14        Q    And then you left office at that time?

15        A    Yes.

16        Q    Now, since that time, did this collaborative,

17   if you will, relationship between the Town and the

18   developer cease?

19        A    I can't speak firsthand, but from my

20   perspective, it did.

21        Q    Okay.     Did the -- also, in 2000 -- I want to go

22   back to 2007, to the moratorium.                   I'm sorry.   2007, now,

23   this is the second moratorium.                 You had the planning in

24   progress, then the 2007 moratorium.

25             Do you recall the rationale or reason that was

               Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons          1851


 1   given to you for the passage of that moratorium?

 2        A    So that development plans wouldn't be presented

 3   to the Town that would end up at some point potentially

 4   being in conflict with our Comp Plan as we finally

 5   accepted it.

 6        Q    And did you recall assurances given by the

 7   Council and/or staff to Pacetta, who was there, that this

 8   would probably take no more than 90 to 120 days?

 9        A    That was our intent.                  We did discuss that.

10        Q    Okay.      And why didn't that happen?

11        A    Why did it --

12        Q    In '07?

13        A    Why did it take longer?

14        Q    Yes.

15        A    We didn't finish the Comp Plan anywhere near as

16   timely as we expected to.              There were a lot of rewrites.

17             Mr. Comfort had a fine-tooth comb and really

18   went over it and suggested a lot of changes along the way

19   that we accepted.       And every time we had a meeting, there

20   were more changes, so it just took a lot, lot longer than

21   we expected it to.

22        Q    Subsequent to 2008, did you become aware of an

23   investment group, that was desirous of acquiring the

24   Pacetta properties, made up of local folks?

25        A    I become -- a rumor to that effect, aware of a

               Southern Reporting Company (386)257-3663
                       Non-Jury Trial Before Judge William A. Parsons             1852


 1   rumor to that effect.

 2        Q      And did that rumor indicate who might be the

 3   members of that group?

 4               MR. SHEPARD:             Objection; hearsay, rumor,

 5        innuendo.

 6               MR. HEEBNER:             I think she can testify from what

 7        is generally well known in the community.                     I don't

 8        think she can testify as to exactly what was told to

 9        her.

10               THE COURT:           It's pretty much hearsay.

11        Sustained.

12               When you're trying to prove the truth of the

13        fact asserted, it seems to me you can't use --

14               MR. HEEBNER:             If you can't get it directly, you

15        can't do it through rumor, I suppose?

16               THE COURT:           Yeah.

17               MR. HEEBNER:             I have no problem with that.

18        Thank you.

19   BY MR. HEEBNER:

20        Q      Were you asked to become an investor in that

21   group?

22        A      No.

23        Q      Did you continue to observe the actions of the

24   Town Council and the Planning Board as it relates to the

25   continuing development of the Comp Plans for the Pacetta

                 Southern Reporting Company (386)257-3663
                       Non-Jury Trial Before Judge William A. Parsons    1853


 1   property?

 2        A      I did for most of 2009.

 3        Q      Okay.       And, in 2010, were you a part of the

 4   process of developing and creating the new Comprehensive

 5   Land Use Plan and LUDC?

 6        A      No.

 7        Q      Based on your observations of the actions of

 8   the Council in '09, what is your opinion as to their

 9   intent in delaying this project until the Johnsons would

10   be forced to leave town, financially or otherwise, and

11   the property could be acquired by the Town?

12               MR. SHEPARD:             Objection; calls for an opinion.

13        This is a lay witness.

14               THE COURT:           Sustained.

15   BY MR. HEEBNER:

16        Q      Do you --

17               MR. HEEBNER:             Well, I think that's not a

18        legal -- well, it's sustained.

19   BY MR. HEEBNER:

20        Q      What was your opinion as to the Town Fathers'

21   actions at that time and its impact on the Pacetta

22   property?

23               MR. SHEPARD:             Same objection.

24               THE COURT:           Sustained.

25

                 Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons       1854


 1   BY MR. HEEBNER:

 2        Q      Did you ever overhear a member of the Town

 3   Council or the Town Planning Board, during any of your

 4   tenure, indicate that there was a desire by him or her to

 5   delay this property or to starve the Johnsons out or that

 6   sort of statement in order that this project would never

 7   be built?

 8               MR. SHEPARD:           Objection; leading and hearsay.

 9               MR. HEEBNER:           I haven't gotten to the hearsay

10        yet.

11               THE COURT:         I think you're asking for comments

12        by people currently in office.

13               MR. HEEBNER:           Correct.

14               THE COURT:         When they made the statement.

15               MR. HEEBNER:           Correct.

16               THE COURT:         All right.            Overruled.

17               THE WITNESS:           I did not hear anybody say that

18        they wanted to run the Johnsons out of town myself,

19        if that was your question.

20   BY MR. HEEBNER:

21        Q      That was my question.

22        A      Okay.     No, I did not hear anybody say that.

23        Q      Okay.     But was that rumored?

24               MR. SHEPARD:           Objection.

25               THE COURT:         Sustained.

                 Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons           1855


 1              MR. HEEBNER:           I tried.

 2   BY MR. HEEBNER:

 3        Q     In 2000 -- did you vote on the moratorium in

 4   2008?

 5        A     Yes.

 6        Q     Okay.     Why?

 7        A     For the reason I already stated, why we voted

 8   for the moratorium in 2007.                We didn't want a Comp Plan

 9   to conflict with the developer's approved development

10   plan.

11        Q     And that moratorium, again, was imposed only on

12   the property of -- or affected only the property of

13   Pacetta?

14        A     It did.

15        Q     Okay.

16              MR. HEEBNER:           We have no further questions.

17              THE COURT:         Thank you.

18              Cross-examination?

19              MR. SHEPARD:           Your Honor, with respect, we'd

20        like to start tomorrow.                 We can start today, but I'd

21        like --

22              THE COURT:         I've got 15 minutes more till 5, so

23        let's get going.

24              MR. SHEPARD:           Okay.

25                             CROSS-EXAMINATION

                Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons                  1856


 1   BY MR. SHEPARD:

 2        Q     Good afternoon, Ms. Epps.                        How are you?

 3        A     Fine.       Thank you.

 4        Q     I miss you on Council.

 5        A     Thank you.

 6        Q     You said there was -- you didn't want the Comp

 7   Plan to conflict with an approved development agreement

 8   of Pacetta, right?

 9        A     Of anyone.

10        Q     Of anyone?

11        A     It just happened at that time that Pacetta

12   owned that property.

13        Q     And, in fact, that is kind of ultimately the

14   issue.   There has never been an approved development plan

15   of a mixed-use project, like the one you see on the board

16   in front of you, for Pacetta?                   There never was an

17   approved development plan?

18        A     No.

19        Q     Okay.       So I want to talk to you a minute about

20   the visioning.       You were a participant in the visioning

21   or were you just aware of it?

22        A     No.     I was a participant.

23        Q     Okay.       Ma'am, this is in the white book.                   I'm

24   going bring it to you.              I do not know what it's in

25   evidence as.

                Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons           1857


 1              This is the visioning and the minutes.                  It's

 2   got more than just minutes attached to it, so if you'll

 3   just thumb through it for just a minute, then I'll ask

 4   you a few questions about it.

 5              All right.           Does that appear to you to be the

 6   minutes from the meeting, on top of this exhibit, where

 7   the visioning that was performed by the Town in 2002 was

 8   adopted?

 9        A     I haven't gotten that far yet.

10        Q     Sure.

11        A     Hang on.

12              Yes.

13        Q     That would -- and you can find that on Page 2,

14   starting at Line 81?

15              MR. HEEBNER:             What book is this?

16              MR. SHEPARD:             It is the defense book one.       It's

17        Exhibit 2.        I'm not sure what it's in evidence as.

18        It's the visioning and the minutes that accompany

19        that.

20              THE WITNESS:             Yes.       And the vote is on Line 93.

21   BY MR. SHEPARD:

22        Q     Okay.       And, in fact, you were a member of the

23   visioning team?

24        A     It -- yes.           It was a loosely structured

25   committee.

                  Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons   1858


 1        Q      Okay.     And, in fact, you seconded the motion to

 2   adopt this visioning report, didn't you?

 3        A      I did.

 4        Q      And it was 5-0 vote?

 5        A      Right.

 6        Q      All right.         And none of those votes were by

 7   Mr. Comfort or Mr. -- or Ms. Barbara Davis or Ms. Derr or

 8   Mr. Sturno or any -- none of those people were part of

 9   this?    This was you and Mr. -- let's go ahead and say who

10   it was.

11        A      Mr. Goudie, Ms. Andreano, myself, Vice Mayor

12   Rogerson and Mayor Hoak.

13        Q      Okay.     So with regard to the visioning report

14   then, a copy of which is attached at the back of those

15   minutes, let's take a look at that for a minute.

16               It has a summary up top that was prepared by

17   Ms. Konchan and I believe that it -- should be the very

18   next page after the signature page of the minutes.

19               Do you see that staff report to Council?

20        A      Yes.

21        Q      Okay.     Was this, in fact, the recommendation or

22   the staff report to you regarding the visioning?

23        A      Yes.

24        Q      Okay.     And this visioning process was monitored

25   by or, I guess, moderated by a Dr. Herbert Marlowe, we've

                 Southern Reporting Company (386)257-3663
                       Non-Jury Trial Before Judge William A. Parsons            1859


 1   heard testimony about; is that right?

 2        A      Yes.

 3        Q      And the process, according to Page 2, the first

 4   paragraph, took over six months.                       Does that seem correct

 5   to you?

 6        A      Uh-huh, yes.

 7        Q      All right.           And the people who served on the

 8   committee that prepared the visioning, were they

 9   hand-picked by the Council at that time?

10        A      No.

11        Q      Okay.       How were those people who formed the --

12   performed the service for the community for six months,

13   how were they picked?

14        A      Volunteers.

15        Q      Volunteers.

16               Were those volunteers, in a general way,

17   considered some of your leading citizens in terms of

18   their involvement in the community and their reputations,

19   backgrounds, credentials, and that sort of thing?

20        A      Many of the people who volunteered fit that

21   category.

22        Q      Okay.       Would you turn to the second page of the

23   presentation called "Charting a Course for Ponce Inlet,"

24   where it says the actual vision.                       It's called Charting a

25   Course for Ponce Inlet.

                 Southern Reporting Company (386)257-3663
                     Non-Jury Trial Before Judge William A. Parsons              1860


 1             Do you see that vision?

 2        A    Yes, I do.

 3        Q    Now, this vision, as well as the other portions

 4   of this report here, are adopted right into the 2003 Comp

 5   Plan, aren't they?

 6        A    They were.

 7        Q    Verbatim, correct?

 8        A    Yes.

 9        Q    Okay.       And this vision statement, this vision

10   statement right here on Page 2, this appears on the

11   Town's website and has for many years?

12        A    Yes.

13        Q    And it also appears on the screens inside the

14   Town Council at every meeting, before the meeting begins,

15   that very same vision?

16        A    It used to.            I don't think it was up there the

17   last time I was there, but it was there for a long time.

18        Q    Okay.       Well, did you happen to visit the town

19   during the DOAH proceeding last week?

20        A    No.

21        Q    Okay.       Now, if you will turn with me to the

22   page -- and I'll tell you the mark.                        It's Number 6,

23   Recommendations.       It's got a number down -- it's actually

24   on the top right-hand corner of the page if you're on the

25   right page with me.

               Southern Reporting Company (386)257-3663
                       Non-Jury Trial Before Judge William A. Parsons                      1861


 1          A    Yes.

 2          Q    Okay.       During your testimony, I heard you say,

 3   and I was glad, because I wasn't sure you knew this, but

 4   that you had been discussing the creation of the ROD

 5   during the Comp Plan Amendment process for 2003, correct?

 6          A    Right.

 7          Q    And that's because, on this page of

 8   recommendations, the second bullet point is:                             The

 9   creation of a historic district overlay for appropriate

10   commercial and residential areas, correct?

11          A    I don't remember there being a direct

12   correlation, but they do go together.

13          Q    Okay.       So you wouldn't quarrel with the fact

14   that -- or the statement that the area that has been

15   designated as the ROD fits the criteria as spelled out

16   there in the vision, at least in terms of the Town's

17   view, that this area that's been shown on this map in

18   multiple locations, qualifies as historic, scenic, the

19   kind of thing that you wanted to seek special protection

20   for?    You don't quarrel with that, do you?

21          A    No.

22          Q    In fact, the Midden Mound over here is over 800

23   years old, at least based on the data that I've seen.                              Do

24   you agree with that?

25          A    I don't know how old it is.                            I know it's old.

                 Southern Reporting Company (386)257-3663
                    Non-Jury Trial Before Judge William A. Parsons   1862


 1        Q    Okay.      And so is the Hasty Cemetery, correct?

 2        A    Yes.

 3        Q    Okay.      So whether it qualifies for historic

 4   designation, in terms of meeting the intent of the

 5   vision, that's exactly what the ROD did, didn't it?

 6        A    It did.

 7        Q    Okay.      Now, there are other parts of the vision

 8   that talk about businesses that are small-scale to

 9   service the needs of the community; is that right?

10        A    Right.

11        Q    And would you, at least, agree with me --

12   although we may not agree on dry boat storage, would you

13   agree with me that a 60,000-square-foot building is not

14   small-scale?

15        A    One part of it isn't.

16        Q    Okay.      One part would be the dry boat storage

17   facility, correct?

18        A    Right.

19        Q    Okay.      And so that building would not be in

20   keeping with the vision of this town that spent six

21   months and paid a consultant to help it come up with; is

22   that right?

23        A    Part of it would not.

24        Q    And it was so important to the Town that not

25   only did they adopt the vision as kind of a flourishing

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons         1863


 1   flowery resolution to display on screens around the town

 2   and on the website, but it put it into the Comp Plan?                   It

 3   did do that, right?

 4        A     Yes.

 5        Q     That is a very significant move, would you

 6   agree?

 7        A     Yes.

 8        Q     Okay.       And it tells the world, doesn't it, this

 9   is what we want in our town?                   This is what we stand for,

10   doesn't it?

11        A     One would presume.

12        Q     Okay.       Or else why would you put it there,

13   correct?

14        A     That makes sense.

15        Q     All right.           Now -- and at the time you voted

16   for this visioning and adopted it, both as a resolution

17   in the town and also into the Comp Plan of 2003, you

18   thought it was in the best interest of the town?

19        A     Right.

20        Q     You wouldn't have voted for anything that you

21   didn't think was in the best interest of the town when

22   you were in office, would you?

23        A     No.

24        Q     Okay.       And that vision -- that vision, the one

25   that's actually in the Comp Plan, that still guides the

                Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons            1864


 1   Town today, doesn't it?

 2        A    Yes.

 3        Q    All right.         Now, let's talk about the

 4   Comprehensive Plan of 2003.

 5             My first question:                Was it ever challenged at

 6   any time by anybody?

 7        A    Not that I recall.

 8        Q    Okay.     Now, that particular Comp Plan included

 9   in it a restriction on buildings in the riverfront

10   commercial of which the property on the board to your

11   right -- to your left, excuse me, is a part of?                You

12   agree, that's part of the riverfront commercial?

13        A    Yes.

14        Q    It had a restriction on buildings of no more

15   than 5,000 square feet, right?

16        A    Correct.

17        Q    And you voted for that, too?

18        A    Yes.

19        Q    And that was because of the vision that called

20   for small scale, correct?

21        A    Yes.    Right.

22        Q    Indeed, the plan that you voted for also had a

23   restriction, from one sailor to another, that said that

24   the existing marinas in town were sufficient to service

25   the needs of the community and that there would be no

               Southern Reporting Company (386)257-3663
                      Non-Jury Trial Before Judge William A. Parsons   1865


 1   expansion of existing marinas, didn't it?

 2        A     Yes.

 3        Q     Okay.       And you thought that was in the best

 4   interest of the town?

 5        A     At the time.

 6        Q     At the time you were voting for these

 7   amendments to the Comp Plan and the visioning, did you

 8   know the Johnsons?

 9        A     No.

10        Q     Had you ever met anyone who claimed to be from

11   Pacetta?

12        A     No.

13        Q     Did you have a grand plan hatched with a bunch

14   of other citizens to put restrictions on this property to

15   devalue it in some way so the Town could get their hands

16   on it?   Was that your plan?

17        A     Not my plan.

18        Q     Okay.       Now, let me ask you about the

19   restriction specifically that was in the ROD that's been

20   a big feature of the case and that's the restriction on

21   dry boat storage facilities in the ROD.

22              Okay.       That is, in fact, the restriction,

23   correct?

24        A     Yes.

25        Q     It's not dry boat storage, which is a different

                Southern Reporting Company (386)257-3663
                   Non-Jury Trial Before Judge William A. Parsons       1866


 1   thing, isn't it?

 2        A    It can be.

 3        Q    Okay.     There is, in fact, dry boat storage

 4   available to the property?              It's not a restriction in the

 5   Comp Plan, is it?

 6        A    Right.

 7        Q    Okay.     And they use some dry boat storage

 8   associated with the boatyard operation that's there

 9   today?

10        A    Yes.

11        Q    At any time when you were on Council from 2002

12   to 2008, did you ever see a plan presented to you, either

13   informally or formally, that included development on the

14   property of dry stack -- of dry boat storage, as opposed

15   to a dry-stack facility like the one illustrated on the

16   diagram to your left?

17        A    State the beginning of the question again,

18   please.

19        Q    Yes.    Was any plan presented to you by Pacetta,

20   either in person or formally in a public meeting, which

21   included just dry boat storage, as opposed to a dry boat

22   storage facility like the one illustrated on your left?

23        A    I don't remember if the very early discussions

24   included dry boat storage facilities or not.

25             THE COURT:         Do you expect to be much longer?

               Southern Reporting Company (386)257-3663
                 Non-Jury Trial Before Judge William A. Parsons               1867


 1        MR. SHEPARD:              Oh, yes, sir.

 2        THE COURT:            All right.            Would you be able to

 3   come back in the morning?

 4        THE WITNESS:              Yes, sir.

 5        THE COURT:            We -- I wouldn't break except we

 6   have a court staff that -- we've been at it since

 7   8:30 this morning.              And if we stretch these days

 8   out, it becomes very tough for everybody, especially

 9   our court reporter, who is the hardest worker in the

10   room.

11        All right.            We're going to take a break until

12   9:00.

13        Are we doing those protection hearings in the

14   morning?

15        Yeah.        We'll make it 9:00 in the morning.

16        I'm going to ask -- there's a rule in place.

17   It's called the rule of sequestration.                       Witnesses

18   can't talk to anybody else involved in the case,

19   but -- you can't even talk to the lawyers involved

20   until we finish your cross-examination.                      He's in the

21   middle of your cross.                 So you can talk about

22   anything else to anybody, but not about the case

23   until you finish up.                That will be some time in the

24   early morning.

25        Give her some sense of when she can get out of

             Southern Reporting Company (386)257-3663
              Non-Jury Trial Before Judge William A. Parsons                 1868


 1   here tomorrow.        Before 10:00?

 2        MR. SHEPARD:           I'm going to guess that I will

 3   have about another hour with her and then whatever

 4   cross.

 5        MR. HEEBNER:           My direct was only 20 minutes.

 6   Now, that's ridiculous.

 7        THE COURT:         Well, let's let her leave and then

 8   we'll talk about that.

 9        Thank you very much.

10        THE WITNESS:           Thank you, Judge.

11        (Whereupon, the witness left the stand.)

12        MR. SHEPARD:           It might not be as long.               I just

13   don't know.     You asked for an estimate.                    I'm giving

14   you my best estimate.

15        MR. McKINNON:           Housekeeping matters, Your

16   Honor.

17        MR. HEEBNER:           Looks like a filibuster --

18        THE COURT:         Let's let the witness leave.

19        You really think you're going to spend an hour

20   with her?

21        MR. SHEPARD:           I don't know, but it's possible

22   and I don't want to underestimate.                        I mean, I

23   thought I --

24        THE COURT:         Well, what do you think?

25        MR. SHEPARD:           I'm sorry?

          Southern Reporting Company (386)257-3663
                Non-Jury Trial Before Judge William A. Parsons            1869


 1        THE COURT:           I mean, what do you think?           You've

 2   been at it for 15 minutes.                    She was -- direct was 20

 3   minutes.     You've been on cross for 15 minutes, going

 4   over the same things that you go over with every

 5   witness, whether they testified or not, over and

 6   over and over again.

 7        MR. SHEPARD:             Your Honor, I apologize --

 8        THE COURT:           It's like you're boycotting the

 9   trial and trying to make this long for -- all that

10   information is really not even in doubt, is it?

11        MR. SHEPARD:             Your Honor, I apologize.         I

12   really do.       But I don't know if you fully can

13   appreciate the amount of pressure that is on the

14   Town right now.           I'm doing everything I can to

15   preserve --

16        MR. HEEBNER:             Objection to all the editorial

17   comments, nonresponsive.

18        THE COURT:           I know -- I understand this is a

19   big deal for everybody.                  I appreciate that.    But, I

20   mean, you're -- I mean, when you get up and you

21   comment about, Well, we miss you on the Council, I

22   mean, if this was a jury trial, I'd declare a

23   mistrial.      That's -- a lot of this stuff you're

24   doing is inappropriate.                  You're testifying -- your

25   leading questions are so far leaned over, they

          Southern Reporting Company (386)257-3663
                 Non-Jury Trial Before Judge William A. Parsons                 1870


 1   virtually -- you're testifying.

 2        Now, I've heard it so often, there's no harm

 3   done.     I mean, I know your points.                        I can almost do

 4   them myself.

 5        But, I mean, I'm not going to restrict you on

 6   cross-examination, but I would encourage you to take

 7   the overnight and to get focused on exactly what you

 8   need from the witness.                  It's your call.          I'm not --

 9   you know, cross-examination is truth testing.

10        But it's getting very hard to listen to this

11   over and over and over again.                        I have to do it.

12   It's my job, but it's -- it's -- if this was a jury,

13   you'd be marching yourself off the plank with

14   credibility.

15        Thank you.

16        What else do we need to talk about?

17        MR. McKINNON:              Your Honor, I was going to ask

18   from the Plaintiffs what their best understanding of

19   when they will complete, so I could start preparing.

20        THE COURT:            Well, I think we've got the first

21   part, 10:00.

22        If he finishes by 10, when will you finish?

23        MR. HEEBNER:              Again, it's all a matter of

24   cross.     I've got two --

25        THE COURT:            When would you expect to finish?

             Southern Reporting Company (386)257-3663
               Non-Jury Trial Before Judge William A. Parsons                 1871


 1   Well, let's talk how many more witnesses you have.

 2        MR. HEEBNER:            Well, I had two out there, but

 3   they had to leave --

 4        THE COURT:          No.      Tomorrow.           We're not going to

 5   do any more today.            Tomorrow.

 6        MR. HEEBNER:            I'm going to have three.

 7        THE COURT:          And who will they be?              Let's give

 8   them a heads-up.

 9        MR. HEEBNER:            Kassandra Blissett, the former

10   Town Manager, number two, Gary Dickens, Planner,

11   three, Hank Fishkind, Economist, and we're done.

12        THE COURT:          Okay.

13        MR. HEEBNER:            But we do need to get all the

14   documents and I would ask -- again, Counsel, look at

15   all the documents I've offered into evidence the

16   first of the week so we can get them all in

17   evidence.     We still have to do that, or, otherwise,

18   I've got to put a witness up there and go through

19   this whole drill again, so...

20        THE COURT:          Okay.        So that will give you a

21   lineup.   We can't possibly finish -- if you're going

22   to go to 10, we'll never be done by --

23        MR. SHEPARD:            Kassandra Blissett and Fishkind,

24   is that the only other two?

25        MR. UPCHURCH:            And Gary Dickens.

          Southern Reporting Company (386)257-3663
               Non-Jury Trial Before Judge William A. Parsons                   1872


 1         MR. HEEBNER:           Gary Dickens.

 2         THE COURT:         Okay.

 3         MR. HEEBNER:           They should be relatively short

 4   witnesses, for our perspective, but geez.

 5         THE COURT:         Okay.        No, no, no.          These cases are

 6   not tried without tension.

 7         I'm just saying that -- I mean, we've got this

 8   rhythmic set of questions we go through.                         I mean,

 9   somebody could come in and say the weather was

10   raining that day and the next thing, Well, did you

11   know that there was the ROD back then?                        I mean, you

12   can do that, but it -- it's really getting tiresome,

13   I guess is my point.

14         MR. SHEPARD:           Tiresome for me, too, Your Honor.

15         THE COURT:         Okay.        Now it's tiresome to both of

16   us.

17         MR. SHEPARD:           I'm trying to make a record.

18         THE COURT:         Right, but it -- I mean, I think we

19   know some things.            This -- I mean, this 2003 Comp

20   Plan happened before Pacetta bought their property.

21   Is there any dispute about that?

22         MS. JOHNSON:           No.

23         MR. HEEBNER:           No.

24         THE COURT:         How many questions -- how many

25   times have you asked that question?                        30?

           Southern Reporting Company (386)257-3663
               Non-Jury Trial Before Judge William A. Parsons                     1873


 1         MR. SHEPARD:           How many times?

 2         THE COURT:         You can do it.               I can't stop you --

 3         MR. HEEBNER:           Your Honor --

 4         THE COURT:         -- but I try and dissuade you from

 5   asking useless questions and get your focus on the

 6   meat of the coconut.              But I'm not -- this is too big

 7   a deal for me to try to restrain you, other than to

 8   try to use the bully pulpit to discourage you from

 9   asking senseless questions.

10         MR. McKINNON:           Your Honor, back to my --

11         THE COURT:         That ought to finish at noon-ish.

12         MR. McKINNON:           Is that right?

13         MR. HEEBNER:           If you'll let me, I'll be done.

14   I promise, I'll be done.

15         MR. McKINNON:           Because I want to be ready to go

16   after lunch.

17         THE COURT:         I think you ought to have your

18   witnesses here after lunch.

19         MR. McKINNON:           Okay.        I'll have them ready to

20   go.

21         THE COURT:         1:00 and then we'll just have them

22   sit there until we get to them.

23         MR. McKINNON:           All right, sir.

24         THE COURT:         Okay.

25         MR. McKINNON:           I'll do that.                Thank you, Your

           Southern Reporting Company (386)257-3663
              Non-Jury Trial Before Judge William A. Parsons   1874


 1   Honor.

 2        THE BAILIFF:           All rise.

 3        (Whereupon, Court was adjourned at 5:04 p.m.)

 4

 5                     (End of Volume XIV)

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          Southern Reporting Company (386)257-3663

				
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