Morton Butler Timber Co. v. United States

• Decision Date: 28 June 1937
• Docket Number: No. 7492.,7492.
• Citation: 91 F.2d 884
• Parties: MORTON BUTLER TIMBER CO. et al. v. UNITED STATES.
• Court: U.S. Court of Appeals — Sixth Circuit

91 F.2d 884 (1937)

MORTON BUTLER TIMBER CO. et al. v. UNITED STATES.

No. 7492.

Circuit Court of Appeals, Sixth Circuit.

June 28, 1937.

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R. R. Kramer and D. C. Webb, both of Knoxville, Tenn. (Barthell & Rundall, of Chicago, Ill., and Green, Webb, Bass & McCampbell, and Poore, Kramer & Testerman, all of Knoxville, Tenn., on the brief), for appellants.

R. S. Boyd, of Washington, D. C., and J. W. Cooper, of Knoxville, Tenn. (Frank Chambers, of Washington, D. C., James B. Frazier, Jr., and Robert T. Kennerly, both of Knoxville, Tenn., and J. Gordon McKenzie, of Dayton, Tenn., on the brief), for the United States.

Before SIMONS and ALLEN, Circuit Judges, and MARTIN, District Judge.

MARTIN, District Judge.

The General Assembly of Tennessee, by chapter 54 of the Acts of 1927 and chapter 99 of the Acts of 1929, granted the United States of America the necessary consent to acquire lands, pursuant to Act of Congress of May 22, 1926 (as amended U.S. C., title 16, § 403 et seq. 16 U.S.C.A. § 403 et seq.), establishing the Great Smoky Mountains National Park. In an appropriate proceeding, large tracts of land owned by appellants in Blount county, Tenn., were condemned for public use as a part of the National Park.

On the trial below, the jury awarded the appellant landowners $483,500 as compensation for the land taken; and the District Court entered judgment thereon. Dissatisfied with the verdict, appellants seek a new trial on assignment of errors to the admission and exclusion of evidence, alleged misconduct of the government attorneys, inadequacy of the verdict, and because of newly discovered evidence. They charge error, also, in the insufficient allowance of interest.

1. Three assignments of error (4, 5, 6) are predicated upon the admission of evidence. It is charged that the District Court erred in permitting the witnesses Greer, Montony, and Chapman to give opinion testimony as to the value of the property.

The rule is settled that the decision of the trial court, with respect to whether a witness called to testify to any matter of opinion has such qualifications and knowledge as to make his testimony admissible is conclusive unless clearly shown to be erroneous in matter of law. Stillwell Mfg. Co. v. Phelps, 130 U.S. 520, 527, 9 S.Ct. 601, 32 L.Ed. 1035; Kovach v. United States, 53 F.(2d) 639 (C.C.A.6). The finding of the trial court on a question of fact, upon which the admissibility of evidence depends, will not be reversed on appeal, if the finding is fairly supported by the evidence. Gila Valley, etc., Ry. Co. v. Hall, 232 U.S. 94, 103, 34 S.Ct. 229, 58 L.Ed. 521; Kovach v. United States, supra; Citizens' Bank & Trust Co. v. Allen, 43 F.(2d) 549, 551 (C.C.A.4). Cf. Spiller v. Atchison, Topeka & Santa Fe Ry. Co., 253 U.S. 117, 130, 40 S.Ct. 466, 471, 64 L.Ed. 810; Turner v. American Security & Trust Co., 213 U.S. 257, 261, 29 S.Ct. 420, 53 L.Ed. 788; Montana Ry. Co. v. Warren, 137 U.S. 348, 353, 11 S.Ct. 96, 34 L.Ed. 681.

In Clarke v. Hot Springs Electric Light & Power Co., 55 F.(2d) 612, 615 (C.C.A. 10), it was held that the competency of an expert is a preliminary question resting in the discretion of the trial court, and its decision in the absence of a plain error of law, serious mistake of fact, or abuse of discretion, will not be disturbed. Cf. District of Columbia v. Chessin, 61 App.D. C. 260, 61 F.(2d) 523; Gila Valley, etc., Ry. Co. v. Lyon, 203 U.S. 465, 474, 475, 27 S.Ct. 145, 51 L.Ed. 276; Chateaugay, etc., Co. v. Blake, 144 U.S. 476, 484, 12 S. Ct. 731, 36 L.Ed. 510.

The qualification of a witness to testify as to values of real or personal property is a preliminary question addressed to the discretion of the lower court; and the ruling of the trial judge will be sustained on appeal, unless manifestly erroneous. Union Trust Co. v. Woodrow Mfg. Co., 63 F.(2d) 602, 607 (C.C.A.8). The language quoted from 11 R.C.L. p. 638, § 56, in the last-cited case is pertinent to the question before us: "In regard to property value, the standard of qualification of the witness cannot usually be fixed very high. Not only are professional appraisers or dealers in the class of property in question competent as witnesses, but also others who have bought and sold similar property, or who know the prices paid therefor, even though that knowledge is based on secondary evidence, provided, of course, they are familiar with the property in question. Such witnesses are not, like experts, supposed to have science and skill superior to that of the jurors, but have a knowledge of the particular facts which the jurors have not."

In Montana Ry. Co. v. Warren, 137 U.S. 348, 353, 11 S.Ct. 96, 97, 34 L.Ed. 681, the Supreme Court, after pointing out that it has been held repeatedly that farmers living in the vicinity of a farm may testify as to its value, although without knowledge of sales of similar property, said: "If the rule were as stringent as contended, no value could be established in a community until there had been sales of the property in question, or similar property. After a witness has testified that he knows the property and its value, he may be called upon to state such value. The means and extent of his information, and therefore the worth of his opinion, may be developed at length on cross-examination. And it is fully open to the adverse party, if not satisfied with the values thus given, to call witnesses in the extent of whose knowledge and the weight of whose opinions it has confidence."

In Lebanon & Nashville Turnpike Co. v. Creveling, 159 Tenn. 147, 17 S.W.(2d) 22, 65 A.L.R. 440, the Supreme Court of the state in which the land here involved is situated held that, in passing upon the admissibility of evidence of value, more is left to the discretion of the trial court than in the determination of most other issues, so that an exception to the admission or exclusion of evidence in a land damage case will ordinarily not be sustained, except in case of manifest error.

Applying these principles to the admission of the opinion testimony which appellants denounce as error, we find, upon careful consideration of the record, no abuse of discretion by the District Judge. In the instance of each of the three witnesses, qualifying experience and sufficient knowledge of the subject matter were shown to permit properly the expression of opinion as to the value of the property.

2. Three assignments of error (1, 2, 3) are laid to the exclusion of evidence by the trial court in refusing to permit the landowners to prove (a) the stumpage value of the timber standing upon the property; (b) the amount of standing timber as shown by a certain (Holt and Latham) cruise; and (c) the value of the property in the opinion of the witness Chambers.

(a) Did the court err in denying appellants the right to prove the stumpage value of the timber on the property?

The record shows that the most profitable use to which the property could be adapted was the sale and manufacture of its standing timber.

In condemnation cases, the most profitable use to which land can probably be put in the reasonably near future may be shown and considered as bearing upon its market value. McCandless v. United States, 298 U.S. 342, 345, 56 S.Ct. 764, 765, 80 L.Ed. 1205, decided May 18, 1936; Olson v. United States, 292 U.S. 246, 255, 54 S.Ct. 704, 708, 78 L.Ed. 1236; Mississippi & R. R. Boom Co. v. Patterson, 98 U.S. 403, 408, 25 L.Ed. 206. But from this principle it does not follow that a landowner is privileged to prove separately the values of various uses to which the land is adapted, and to add the separate items of value to obtain the compensable value of the land taken by eminent domain.

We held in Devou v. City of Cincinnati, 162 F. 633 (C.C.A.6), that in a proceeding to condemn improved city property testimony as to the cost of the building thereon, or its value aside from the value of the land, by witnesses not qualified to testify as to the value of the land or the property as a whole, is inadmissible. The market value of the entire property being the issue on trial, we deemed it improper to value the building separately, because its value was necessarily affected by the value of the land, its location, surroundings, and the uses to which it could be put.

We consider the same reasoning applicable to the instant case. Here, the stumpage value of the timber is necessarily affected by the location, surroundings, and value of the land for other than timber usages.

Our opinion in the Devou Case, supra, conforms to the rule in Tennessee (within whose domain the land in litigation lies), as announced in Alloway v. Nashville, 88 Tenn. 510, 13 S.W. 123, 8 L.R.A. 123. The state Supreme Court commands a single view of all elements of value, and forbids their separate pricing. The charge of the trial court, in the following language, was approved:

"In determining the market cash value, you cannot single out from the elements of general value the value for an especial purpose, but you are to consider all the constituent elements that make up the market value — its availability, adaptability, and capacity for different uses and purposes.

"In determining the market cash value, everything which enhanced or depreciated its worth should be taken into consideration. If the existence of a rock quarry under the surface of the hill augmented or entered into the market value of the land, that fact should be considered; but the jury could make no separate allowance for the rock, for that would necessitate an inquiry into the cost of excavating and raising it. The cash market value of the land with the rock in it would be the proper consideration." 88 Tenn. 510, 516, 517, 13 S.W. 123, 124, 8 L.R.A. 123.

The Supreme Court of Tennessee not only upheld the foregoing charge, but sustained the action of the trial judge in excluding evidence of the particular value of the land as a reservoir site. The court declined to permit...