Oregon Mesabi Corp. v. CD Johnson Lumber Corp.

• Decision Date: 12 December 1947
• Docket Number: No. 11569.,11569.
• Citation: 166 F.2d 997
• Parties: OREGON MESABI CORPORATION v. C. D. JOHNSON LUMBER CORPORATION.
• Court: U.S. Court of Appeals — Ninth Circuit

166 F.2d 997 (1947)

OREGON MESABI CORPORATION v. C. D. JOHNSON LUMBER CORPORATION.

No. 11569.

Circuit Court of Appeals, Ninth Circuit.

December 12, 1947.

Laing, Gray & Smith, Henry S. Gray, and John R. Becker, all of Portland, Or., for appellant.

King & Wood, Robert S. Miller, and Edward E. Grant, all of Portland, Or., for appellee.

Before DENMAN, STEPHENS, and HEALY, Circuit Judges.

DENMAN, Circuit Judge.

Appellant, hereinafter called Mesabi, appeals from a judgment of the district court condemning a right of way for a logging road over appellant's timber land to timber land of appellee, hereinafter called Johnson, enclosed on three sides by Mesabi's lands. The judgment was for an exclusive easement providing that the described road "be and the same hereby is condemned and appropriated to the plaintiff Johnson as a right of way for a logging road, and said lands are appropriated to and vested in the said plaintiff as an unlimited easement with the right to the exclusive use thereof, subject to the right of the defendant, Oregon Mesabi Corporation, to make such necessary crossings of said right of way as will not unreasonably interfere with the use of said right of way by plaintiff; * * *"

The litigation was commenced in the circuit court of Oregon for Lincoln County. Johnson's complaint stated it to be a Nevada corporation and Mesabi an Oregon corporation. Mesabi filed its verified petition for removal on ground of diversity of citizenship, alleging it to be the defendant and that it is a Delaware corporation. The removal was ordered. Having thus succeeded in securing the removal, Mesabi appeared generally in the district court in a demurrer to the complaint. Thereafter an amended complaint was filed alleging Mesabi to be a Delaware corporation. The jurisdiction was thereby established under the provisions of Section 274 c of the Judicial Code, 28 U.S.C.A. § 399. Mesabi then sought a remand because the complaint on its face did not warrant removal. That is to say, having sworn in the state court that it is the defendant and is a Delaware corporation, it sought remand on the ground that it is not the defendant and that the defendant is someone else, an Oregon corporation. We agree with the district judge's colloquial statement that this is "hocus pocus."

Johnson sought condemnation under the provisions of the Oregon constitution and statutes giving to timber land owners and others access to their lands over adjoining lands. The Oregon constitution in Article I, § 18, as amended in 1924, provides that:

"Private property shall not be taken for public use, nor the particular services of any man be demanded, without just compensation; nor except in the case of the state, without such compensation first assessed and tendered; provided, that the use of all roads, ways and waterways necessary to promote the transportation of the raw products of mine or farm or forest or water for beneficial use or drainage is necessary to the development and welfare of the state and is declared a public use."

Implementing this constitutional provision, Title 12, Chapter 2, O.C.L.A. § 12-202 provides that "any" person or "corporation" who shall require land for the transportation of raw productions of the forest and is unable to agree for a purchase with the owner "shall have the right to condemn so much of the land necessary for such logging railroad, road or ways as may be necessary for the use of such way, road or logging railway, and may maintain a suit for the condemnation thereof in the circuit court of the county wherein said lands are located; provided, that no land shall be taken hereunder until compensation therefor has been assessed and tendered as herein provided."

The Oregon supreme court has upheld such legislation as a proper exercise of eminent domain in Coos Bay Logging Co. v. Barclay, 1938, 159 Or. 272, 292, 79 P.2d 672, and Barkley v. Gibbs, Or., 1947, 178 P.2d 918. We have held constitutional similar legislation of the State of Washington for condemning a private logging road in Ruddock v. Bloedel Donovan Lumber Mills, 9 Cir., 1928, 28 F.2d 684.

Mesabi contends that the phrase "any * * * corporation" so having the power of eminent domain does not include foreign corporations such as Johnson. We do not agree. To hold with Mesabi would mean that this constitutional provision and this statute intend to deny the utilization of the millions of dollars of investors of other states in the costly provision for logging machinery, tractors, trucks, truck roads and railroads giving to Oregon labor its largest source of income and, incidentally, one of the state's largest sources of taxation.

The Oregon supreme court has held the contrary with respect to a similar statute respecting condemnation for telephone lines. Northwestern Electric Co. v. Zimmerman, 67 Or. 150, 152, 135 P. 330, Ann. Cas. 1915C, 927. The principle there established applies here. Cf. § 77-318, O.C.L.A. providing that the Oregon corporation law shall be construed "so as to give to foreign corporations the same rights, powers, and privileges, on a compliance with the laws of this state, as may be acquired or exercised by corporations incorporated under the laws of this state."

Mesabi demurred to the complaint on the ground that it does not allege that Johnson had filed with the county clerk a statement of the "approximate route" of the proposed logging road as provided under § 12-201, O.C.L.A.¹ That statute uses the permissive words "may file" and is for the purpose of giving admission to the lands for the purpose of making an accurate survey. We agree with the district court that the demurrer was properly overruled.

In this connection, it was later contended that the filing with the county clerk showed a description of the "approximate route" differing somewhat from that described in the complaint and hence the procedure is invalid. We have held to the contrary of a similar contention in Eastern Oregon Land Co. v. Willow River Land & Irrigation Co., 9 Cir., 1913, 204 F. 516, 524, certiorari denied 234 U.S. 761, 34 S.Ct. 777, 58 L.Ed. 1581. The same conclusion was reached in In re Willow Creek, 74 Or. 592, 632, 144 P. 505, 146 P. 475.

Nor is there merit in Mesabi's contention that the complaint should show the evidentiary facts why the land sought is "reasonably necessary" for the road. The statement that the land is "reasonably necessary" for the road is an allegation of ultimate fact and we agree with Judge Cavanah's decision in Flora Logging Co. v. Boeing, D.C., D.Or., 1930, 43 F.2d 145, 148, that the allegation is sufficient. Cf. Dallas v. Hallock, 44 Or. 246, 252, 75 P. 204, and Sullivan v. Cline, 33 Or. 260, 54 P. 154.

The timber of the parties grows in the watershed of Euchre Creek in Lincoln County, Oregon. That stream there flows from northerly to southerly. Johnson's timber lies to the northerly and it seeks to transport its logs southerly on a down grade road on or near the creek bottom through Mesabi's timber, enroute to the town of Toledo, where it has its sawmill. Section 12-202, O.C.L.A., permits the condemnor to acquire land necessary for a "logging railroad, road or ways."

What the complaint asked for was a right of way for such a logging road. It alleges in paragraph V that "plaintiff requires the following land situated in Lincoln County, Oregon, as a right of way for a logging road: * * *" and later, in paragraph VII, that "Plaintiff in this action seeks to condemn and acquire the property described in paragraph V for public use, to-wit, for a logging road and to promote the transportation of logs and raw products of the forest. That said lands are reasonably necessary for said purpose."

We construe this language as seeking no more than a right of way over Mesabi's land and agree with the trial court in its exclusion...