Mont. Ry. Co. v. Warren

• Citation: 6 Mont. 275
• Parties: MONTANA RY. Co. v. WARREN and others.
• Decision Date: 05 January 1887
• Court: United States State Supreme Court of Montana

6 Mont. 275

MONTANA RY. Co.

v.WARREN and others.

Supreme Court of the Territory of Montana.

January 5, 1887.

Appeal from district court, Silver Bow county.

Samuel Word and W. W. Dixon, for appellant, Montana Ry. Co.

Knowles & Forbis, for respondents, Warren and others.

BACH, J.

This action was commenced by a petition, upon which commissioners were appointed to assess the value of certain lands lying in Silver Bow county, and belonging to the respondents, over which lands the appellant sought to obtain an easement for the purpose of constructing a railroad. The land mentioned in the petition was a mining claim, known as the “Nipper Lode,”-a claim undeveloped, but upon which there were several shafts, one 41 feet deep, another 20 feet deep. In fact, the property was of that description generally known as a “prospect.” The commissioners made their final report, from which the respondents appealed to the Second judicial district court in and for the county of Silver Bow. The case was heard in that court before a jury, which found a verdict for the respondents herein for the sum of $7,000. A motion for a new trial was heard, and an order was made denying the same; from which order, and from the judgment entered upon the verdict, an appeal was taken to this court.

There are assignments of error in the statement which are not referred to in the appellant's brief; and which will therefore not be considered by this court. Those relied upon are as follows:

1. That there was admitted in evidence the opinion of witnesses as to the value of the land, which opinion was not based upon sales of the land, or of similar property. The witnesses whose opinion was so given had lived for many years in the neighborhood of the Nipper lode. They knew the character of adjacent property, and had bought and sold property of the same description in that neighborhood. The well-settled rule of law is that value of real estate may be proved by witnesses other than experts. In newly-settled communities there could be no experts as to the value of real estate. The value of lands may be proved by the opinion of witnesses who know the character of that land, its availability, fertility, situation, and the character of similar and adjacent property.

A witness as to value of property need not to have been engaged in buying or selling the same. 1 Suth. Dam. 798; 3 Suth. Dam. 463, and cases cited in note; Railroad Co. v. Bunnell, 81 Pa. St. 414-426; Sedg. Dam. 696, 697; Railroad Co. v. Pearson, 35 Cal. 247-261;Robertson v. Knapp, 35 N. Y. 91.

In the case last cited, farmers were called as witnesses to testify as to value of lands. The court say: “The value of land in the vicinity is usually understood by all of the residents of a farming neighborhood, without respect to occupation. I can perceive no objection to the competency of the evidence objected to.” See, also, Lawson, Exp. Ev. 436, and numerous cases cited in the note. It is there remarked that only one state holds a contrary doctrine. This point naturally recurs in the other assignments of error.

2. The appellant claims that the evidence is insufficient to justify the verdict, and that it is against the law, because the Nipper lode was an undeveloped mining claim, which had produced no return, from which no one had ever been taken, which was a mere prospect; and that consequently its value was a speculative value only.

It is admitted by both parties that the true measure of damages is the difference between the market value of the property before and after the constructionof the road. The only questions are whether a prospect has a value that may, in law, be called a market value; and, if so, whether there is proof in this case of any market value. Has a “prospect”-an undeveloped mine- any market value? A full, positive answer to that is that prospects are sold in the market every day. Certainly, property so sold has a market value. The records of Silver Bow county will probably show more transfers by sale of property, such as is known as “prospects,” than of any other kind of real estate. They are frequently sold on execution, foreclosure, and partition sales. They are the subject of daily litigation in our courts.

The witnesses Tibbey and Clark were called by the appellants. Tibbey says that the Kanuck mine was a prospect when $3,000 were paid for a half interest therein. The Kanuck was a small claim, with shafts no deeper than those upon the Nipper lode. He says $15,000 were paid for the Adventure claim when it was a prospect. Clark bought the Steward lode when it was a prospect. Those lodes had no market value. The record shows that portions of the Nipper lode had been sold.

Does the fact that the Nipper lode had produced no return justify the legal conclusion that that property has no legal value, as is claimed by appellant to be the rule of law? A vacant lot in a large city “produces no return.” Any return therefrom in the future must be a matter of speculation,-a speculation depending, among other things, upon the nature and size of the house which is still to be built, and the rent that can be obtained from a lease thereof, if it ever can be leased. If we should apply, in such a case, the rule invoked by appellant, there would be no value assignable to a property which, as a matter of fact, may be immensely valuable. What, then, is the value of such a lot? It is its market value,-the price which it would bring in a fair market,-which price may be established by competent witnesses, who know the character and situation and usefulness of that property. See cases cited above.

Under certain circumstances a stream of water flowing through land makes that land valuable, because of the power to be derived therefrom, or because of the possibility of irrigation, as in this country. There may be no mill. There may have been no attempt to use that water for the purposes of irrigation. Still those are qualities or characteristics which may, under certain circumstances, enhance the present market value of that property, with a mill, or when irrigated and cultivated. That would be speculation. The question is, what effect have these circumstances upon the opinion of the community? How do they affect the market value? A man may have property well situated to a certain purpose,-such as a mill-site, or as a farm, or as a residence or store, or as a mine,-and he may refuse to use it for any one of those purposes to which it is best suited. Still he may sell it is open market to a purchaser whose opinion of its present market value is based upon the future use to which is may be put. Still he may claim, in any proceeding to condemn that land, the market value thereof, as that value is fixed by the public for those purposes.

The difference between such a valuation and speculation seems clear. Land never used by its owner for any purpose is sought to be condemned. The fertility of the soil is one of the characteristics or properties of that land. It has never produced any returns; but there is no attempt to prove future productions. They are speculative. The fertility of the soil is a fact,-a fact which in some cases may add great value to the property, and may be one of the constituents of the market price. See Boom Co. v. Patterson, 98 U. S. 403. The court says, (page 407:) “In determining the value of land appropriated for public purposes, the same considerations are to be regarded as in a sale of property between private parties. The inquiry in such cases must be, what is the property worth in the market, viewed, not merely with reference to the uses to which it is at the time applied, but with reference to the uses to which it is plainly adapted; that is to say, what is it worth from its availability for valuable uses? Property is not to be deemed worthless because the owner allows it to go to waste, or to be regarded as valueless because he is unable to put it to any use. Its capability of being made thus available gives it a market value which can be readily estimated.” And the court cites with approval Young v. Harrison, 17 Ga. 30, in which case the value of farming land at a bridge site was allowed to be proved.

In Boom Co. v. Patterson, just above cited, the value of land on account of its availability for building a boom across a river was allowed to be proved. In the one case there was no bridge; in the other there was no boom. The value of those lands, if a bridge or boom was built, was a matter of speculation; but the present market value of those lands was more or less dependent upon the fact that they might be put to such uses. That was fact. See, also, the other authorities in case of Boom Co. v. Patterson.

So with a “prospect.” It certainly has value in the market. What is the characteristic of the prospect? If ore has been found, that fact is an element of value. It is the “fertility” of that piece of property....