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Arkansas State Highway Commission v. Security Savings Ass'n
Citations: 19 Ark. App. 133; 718 S.W.2d 456; 1986 Ark. App. LEXIS 2484Docket: CA 86-119
Court: Court of Appeals of Arkansas; October 29, 1986; Arkansas; State Appellate Court
George K. Cracraft, Chief Judge, addressed an appeal concerning the condemnation of 4.38 acres of land owned by the appellee. The appellant deposited $32,500 into escrow as estimated just compensation and took possession of the land on July 22, 1983. A jury trial on damages concluded on October 2, 1985, resulting in a verdict of $60,000. The trial court set the interest rate at 11.77% on the judgment amount that exceeded the escrow deposit. The appellant contested this interest rate as excessive. The court referenced Arkansas State Highway Commission v. Stupenti, which established that landowners are entitled to compensation for the loss of use and potential rental income from the date of entry until judgment. It emphasized that just compensation must reflect the actual loss, typically calculated through interest on the land's value. The court also cited Arkansas State Highway Commission v. Vick, where it recognized that landowners may be entitled to a higher interest rate than the statutory limit, arguing that the rate should reflect actual market conditions. In this case, testimony indicated that the average interest on 12-month certificates of deposit was 11.77% from July 22, 1983, to September 30, 1985, while the appellant suggested a range of 7.32% to 9.2% based on risk-free Treasury bill rates. The court found the trial court's selection of the 11.77% rate reasonable, as it was based on local financial market rates rather than a narrower risk-free investment perspective. The appellate court upheld the lower court's decision, affirming the 11.77% interest rate as supported by the evidence.