Burkhart v. United States, 13425.

• Citation: 210 F.2d 602
• Decision Date: 15 February 1954
• Docket Number: No. 13425.,13425.
• Parties: BURKHART et al. v. UNITED STATES et al.
• Court: United States Courts of Appeals. United States Court of Appeals (9th Circuit)

210 F.2d 602 (1954)

BURKHART et al. v. UNITED STATES et al.

No. 13425.

United States Court of Appeals, Ninth Circuit.

February 15, 1954.

T. C. Boyle, Seattle, Wash., for appellant.

Perry W. Morton, Asst. Atty. Gen., Hart Snyder, Sp. Atty., Department of Justice, Spokane, Wash., S. Billingsley Hill, Roger P. Marquis, John C. Harrington, Attorneys, Department of Justice, Washington, D. C., for appellee, the United States.

Charles L. Powell, Moulton, Powell, Gess & Loney, Kennewick, Wash., for appellee Falk.

Before ORR and POPE, Circuit Judges, and LEMMON, District Judge.

POPE Circuit Judge.

On January 24, 1951, the United States brought action in the court below to condemn a parcel of land containing approximately 12 acres located in the State of Washington. The land belonged to Falk and his wife, appellees herein, but a small parcel thereof, which bounded a State highway, had been leased to the appellants Burkhart and O'Brien for a term of five years beginning November 10, 1948. The lease was obtained by the appellants for use as a service station for the sale of gasoline and other petroleum products. They erected thereon a service station, and constructed pumps, tanks and other equipment for use in their business. The Falks and the appellants and their wives were named as defendants in the petition for condemnation. The usual declaration of taking was filed, a deposit of estimated compensation was made, and an order transferring possession to the United States was entered. The United States then moved to dismiss as to the appellants, the lessees mentioned above, upon the ground that by reason of certain terms contained in the lease such defendants had no interest in the award and that no property of such lessees had been taken. That motion was based upon the fact that the lease contained a clause reading as follows:

"If all or any part of subject property shall be taken by any public agency for public use or purpose the entire amount paid as compensation for the property taken and as severance damages resulting to the remaining property of lessors shall be paid to and shall be retained by lessors as their own property. Lessees shall then be entitled to remove all their property, including the service station structure, from the premises and each party will look to the condemnor for compensation on account of any and all damages claimed or asserted by such party on account of or resulting from such taking."

The court denied that motion but made an order which referred to this provision in the lease, reciting that its language was ambiguous and uncertain making it advisable to receive extraneous evidence as to its meaning, and ordered that pursuant to the provisions of Rule 42(b) of the Rules of Civil Procedure, 28 U.S. C.A.¹ the issue of whether such lessees had any interest in the real property taken for which the petitioner should be required to pay them compensation, should be separately tried.²

The court proceeded to try that issue. Extrinsic evidence was given by the attorney who drew the lease, and by the parties to the lease, directed to the question as to what this paragraph of the lease was intended to mean. The court made findings, in which it was concluded:

"That by the terms and conditions of the aforesaid lease, it was intended by the parties thereto that in the event of condemnation the defendants Irwin A. Falk and Vuelta C. Falk, his wife, should receive the entire amount of compensation payable for the taking of the real property above described, that the equipment and improvements placed thereon by the defendants Burkhart and O\'Brien should remain personal property, which said defendants should be entitled to remove; and that if said equipment and improvements should be taken by condemnation said defendants Burkhart and O\'Brien should receive the full amount of such compensation as might be payable therefor.

"That the defendants Falk are entitled to receive the full compensation payable for the taking of Tract Q-1115; that the equipment and improvements remained personal property; that there has been no taking thereof; and that the defendants Burkhart and O\'Brien are entitled to no part of the just compensation payable in the above-entitled proceedings with respect to Tract Q-1115."

A judgment was thereupon entered to that effect. Burkhart and O'Brien, the lessees, and their wives have undertaken to appeal therefrom to this court. They have filed a brief in support of their appeal and have made several specifications as to the manner in which they claim the court erred in arriving at such judgment. On behalf of the United States a brief has been filed undertaking to sustain the judgment upon the merits. The United States is, of course, the party primarily benefited by the court's judgment.³ The Falks have also filed a brief asserting error in the judgment but they took no appeal.⁴

After an extended consideration of the arguments of counsel upon the merits, we have come to the conclusion that this court is without jurisdiction of the appeal. Notwithstanding none of the parties have questioned that jurisdiction it is our duty to note that the appeal is not properly here. In directing the separate trial the court did so upon the authority of Rule 42(b) which reads as follows: "Rule 42(b) Separate Trials. The court in furtherance of convenience or to avoid prejudice may order a separate trial of any claim, cross-claim, counterclaim, or third-party claim, or of any separate issue or of any number of claims, cross-claims, counterclaims, third-party claims, or issues." Clearly enough, the claim of the appellants, the lessees, for just compensation is separate and distinct from the claim of appellees Falk, owners of the fee and of the larger tract, for just compensation to them. It was entirely proper for the court to order a separate trial of the appellants' claim. Rule 54(b) provides: "(b) Judgment Upon Multiple Claims. When more than one claim for relief is presented in an action, whether as a claim, counterclaim, cross-claim, or third-party claim, the court may direct the entry of a final judgment upon one or more but less than all of the claims only upon an express determination that there is no just reason for delay and upon an express direction for the entry of judgment. In the absence of such determination and direction, any order or other form of decision, however designated, which adjudicates less than all the claims shall not terminate the action as to any of the claims, and the order or other form of decision is subject to revision at any time before the entry of judgment adjudicating all the claims."

The "express determination" and the "express direction" called for by this rule were not incorporated either in the order directing the separate trial or in the judgment mentioned. The consequence of this failure to make such determination and direction is that the court has chosen to treat its decision as "subject to revision at any time before the entry of judgment adjudicating all the claims." Hence, the judgment before us is not final and is not appealable under section 1291 of Title 28. Kam Koon Wan v. E. E. Black, Limited, 9 Cir., 182 F.2d 146; Maizel v. Epstein, 90 U.S.App.D.C. 328, 196 F.2d 44; Flegenheimer v. Manitoba Sugar Co., 2 Cir., 182 F.2d 742; Winsor v. Daumit, 7 Cir., 179 F.2d 475; Kuly v. White Motor Co., 6 Cir., 174 F.2d 742; Etten v. Kauffman, 3 Cir., 179 F.2d 302. Typical of such applications of the rule have been those where, as here, the decision of the court was as to some, but not all defendants. Tobin Packing Co. v. North American Car Corp., 2 Cir., 188 F.2d 158; Vale v. Bonnett, 89 U.S.App.D.C. 116, 191 F.2d 334; Garbose v. George A. Giles Co., 1 Cir., 183 F.2d 513.

The fact that none of the parties has raised the question of the appealability of the judgment suggests that failure of the court to make the determination mentioned in the rule may have been an oversight. This rule in its present form became effective in 1948. Since that date the courts have frequently been confronted with the same situation which we observe here. Because of the possibility of oversight they have suggested that the district court should be furnished an opportunity to...