Georgia-Pacific Corp. v. Miller, GEORGIA-PACIFIC

• Decision Date: 28 November 1956
• Docket Number: GEORGIA-PACIFIC
• Citation: 304 P.2d 441,208 Or. 684
• Parties: , 63 A.L.R.2d 308 CORPORATION, Plaintiff-Appellant, v. Tim MILLER and Myrl F. Miller, his wife, Defendants-Respondents.
• Court: Oregon Supreme Court

Page 441

304 P.2d 441

208 Or. 684, 63 A.L.R.2d 308

GEORGIA-PACIFIC CORPORATION, Plaintiff-Appellant, v. Tim MILLER and Myrl F. Miller, his wife, Defendants-Respondents.

Supreme Court of Oregon.

Argued Sept. 12, 1956.

Decided Nov. 28, 1956.

Norman J. Wiener, Portland, argued the cause for appellant. With him on the briefs were King, Miller, Anderson, Nash & Yerke, Portland.

Walter H. Evans, Jr., argued the cause for respondents. On the brief were Krause & Evans and Jack L. Kennedy, all of Portland.

Before WARNER, C. J., and ROSSMAN, LUSK, BRAND, PERRY and McALLISTER, JJ.

ROSSMAN, Justice.

This is an appeal by the plaintiff from a judgment, based upon a verdict, which the circuit court entered in an action instituted by the plaintiff to condemn and acquire an easement of right of way over land owned by the defendants. The strip of land which the plaintiff sought was roughly 80 feet wide and aggregated 2.62 acres. The action was based upon ORS 376.505 through 376.540. Oregon Mesabi Corporation v. C. D. Johnson Lumber Corporation, 9 Cir., 166 F.2d 997. The issue as to use and necessity was tried by the court without a jury and resulted in the entry of an order in favor of the plaintiff which is not attacked upon appeal. Then the issue of compensation was submitted to a jury which returned a verdict of $4,026.20. Following the filing of the verdict, the judgment challenged by this appeal was entered.

After the institution of this proceeding the C. D. Johnson Lumber Corporation, which had filed this action, and three other corporations through an agreement of merger, created a corporate entity entitled Georgia-Pacific Corporation which succeeded to all of the rights and properties of its four predecessors. It has been substituted as the plaintiff-appellant. The defendants-respondents are Tim Miller and his wife, Myrl F. Miller, who are the owners of the land involved in this proceeding.

The appellant presents the following two assignments of error:

1. 'The court on examination of witness Tim Miller, one of the respondents herein, erred in failing to sustain appellant's motion to strike his testimony relating to the depreciated value of the remainder of the tract of respondents' land over and across a portion of which appellant sought to condemn an easement of a right of way for a logging railroad.'

2. 'The court erred in denying appellant's motion for a new trial.'

Appellant's brief explains:

'This second assignment of error raises only one new issue of law not already raised in the first assignment of error. That issue is:

'The verdict of the jury was against law in that there was no competent evidence of market value of said strip of land or of any depreciation in market value of the remainder of respondents' tract to warrant a verdict in the sum of $4,026.20.'

Prior to the aforementioned merger, the C. D. Johnson Lumber Corporation operated a lumber plant in Toledo which secured its logs from a tract of timberland in the Upper Siletz River gorge. The logs were brought to the plant upon a logging railroad owned and operated by the company. Beyond the end of the railroad lay a part of the Siletz Reservation, including a tract of 160 acres of which an Indian by the name of Leo Umatata was the beneficial owner. The title to his tract was held by the United States Government in trust for him under the General Allotment Act of 1887, 24 Stat. 388 as amended, 25 U.S.C.A. § 331 et seq.

In 1941, about eleven years before this proceeding was begun, the Johnson Company wished to extend its logging railroad about twelve miles. The contemplated extension would cross a part of Umatata's land. March 19, 1941, the Johnson Company applied to and, July 25, 1941, received from the Secretary of the Interior, through the medium of an instrument which spoke of a 'revocable permit,' leave to cross Umatata's land. The instrument required the payment annually of $36.74. Umatata's land was only one of several tracts owned by Indians which the contemplated extension would cross. After the leave of July 25, 1941, was received, the extension was built and thereupon the logging trains used it. August 27, 1951, pursuant to his application, the United States issued to Umatata fee patents to his allotted land and September 19, 1951. Umatata conveyed it to the defendant, Tim Miller, a white man. Miller had long known of the railroad and knew that it crossed the 160-acre tract. In August, 1952, Miller posted No Trespass signs on the railroad tracks at the places where they crossed his land and in other ways asserted absolute ownership over the entire tract.

From the above, we observe that when this proceeding was instituted September 2, 1952, the railroad was already upon the land. However, under stipulation of the parties, in the assessment of compensation, no account was taken of the rights, if any, which the plaintiff had in the land.

We will now consider the assignments of error.

Defendant-respondent Tim Miller, to whom we will refer as Miller, was the only defense witness. By virtue of the facts that he owned the tract in question, was familiar with it and had had many years of logging experience, he qualified, under familiar rules, as an expert witness on the question of the amount by which plaintiff's use of the right of way depreciated the value of his remaining, now divided, tract. He testified that, in his opinion, his remaining land had been depreciated in value by a sum in excess of $12,000. Upon cross-examination, some of the bases of that figure were elicited by plaintiff's counsel:

'Q. Now, in arriving at that figure, Mr. Miller, I'd like to inquire whether or not you included in that an element of fire hazard? A. Yes.

'Q. You think the property has depreciated because of fire hazard? A. Yes, sir.

'Q. Now, I'd like to further inquire whether or not in arriving at that figure of $12,000, did you consider as an element possible losses from fire in the future which may be caused by carelessness of hikers or campers or fishermen? A. Partly and partly from the locomotive is the most dangerous; the train is dangerous.

'Q. But you included the element that I have mentioned, that is, the possible losses from fire in the future caused by carelessness of hikers or campers or fishermen? A. That's right. And the fire insurance is higher on it.

'Q. You also included fire insurance? A. I say your fire insurance is higher, rates will be higher if you was to get fire insurance on the property.'

Plaintiff's motion to strike the testimony segregated the three allegedly improper elements: fires in the future, fires caused specifically by campers or fishermen, and increased cost of fire insurance. For convenience, these will be treated individually.

Plaintiff first contends that the risk of future fires resulting from negligent operation of its locomotives is an improper element in estimating the depreciation in value of defendants' tract. Plaintiff has not cited any portion of Miller's testimony in which he based his estimate upon future negligence in the operation of the trains. There is none. In response to queries on cross-examination, Miller testified that he thought the value of the property had depreciated because of fire hazard and that the danger of fires set by trains was 'the most dangerous.' It is significant that, in its instructions to the jury, the court specified that fire hazard could only be considered if it depreciated the value of the remaining tract and that 'any possible damage which may result from negligence in the use of the right of way by plaintiff' was not to be considered. 2 Lewis on Eminent Domain, 3rd Ed. § 740, p. 1314, states the rule as follows:

'When a part of a tract is taken for railroad purposes, danger from fire to buildings, fences, timber or crops upon the remainder, in so far as it depreciates the value of the property, may properly be considered.'

In 1 Orgel, Valuation under Eminent Domain, 2d Ed., § 63, p. 288, it is said:

'The courts have constantly held, for example, that the extra fire risk resulting from construction of a railway property on the owner's land shall be taken into account, and in only a few of the opinions has the court suggested that the amount of the risk shall be estimated as if it were certain that the railway would not operate its locomotives negligently.'

Idaho & W. R. Co. v. Coey, 73 Wash. 291, 131 P. 810; Texas Midland R. Co. v. Burt, Tex.Civ.App., 243 S.W. 669; Chicago, I. & L. Ry. Co. v. Ader, 184 Ind. 235, 110 N.E. 67; Raleigh, C. & S. Ry. Co. v. Mecklenburg Mfg. Co., 169 N.C. 156, 85 S.E. 390, L.R.A.1916A, 1090. See, also, Oregon & California Railroad Co. v. Barlow, 3 Or. 311, and Oregon Mesabi Corp. v. C. D. Johnson Lumber Corp., 9 Cir., 166 F.2d 997.

Plaintiff cites as the next...