People By and Through Dept. of Public Works v. City of Fresno

• Decision Date: 06 December 1962
• Citation: 210 Cal.App.2d 500,26 Cal.Rptr. 853
• Parties: PEOPLE of the State of California, acting by and through the DEPARTMENT OF PUBLIC WORKS, Plaintiff, v. CITY OF FRESNO, a municipal corporation, Defendant and Appellant, Howard H. Chandler et al., Defendants and Respondents. Civ. 6577.
• Court: California Court of Appeals Court of Appeals

Page 853

26 Cal.Rptr. 853

210 Cal.App.2d 500

PEOPLE of the State of California, acting by and through the DEPARTMENT OF PUBLIC WORKS, Plaintiff, v. CITY OF FRESNO, a municipal corporation, Defendant and Appellant Howard H. Chandler et al., Defendants and Respondents.

Civ. 6577.

District Court of Appeal, Fourth District, California.

Dec. 6, 1962.

Rehearing Denied Jan. 2, 1963.

Hearing Denied Jan. 30, 1963.

John H. Lauten, City Atty., Spencer Thomas, Jr., James A. Gardner, and Alan D. Davidson, Deputy City Attys., for appellant.

Crossland, Crossland & Richardson and William C. Crossland, Fresno, for respondents.

COUGHLIN, Justice.

The issue for determination in this action was whether the owner of a determinable fee estate in a parcel of real property, which was part of a larger parcel conveyed for a limited use, and which subsequently was taken through eminent domain proceedings, or the owner of the reversionary interest in the property taken, was entitled to the compensation awarded for such taking. The trial court found in favor of the latter. The primary issues on appeal are three fold, viz., (1) whether the evidence sustains a finding that the determinable fee estate had terminated before the taking in question, thus entitling the owner of the reversionary interest to the award; (2) whether the subject taking, by preventing further use of the property for the limited purpose designated in the grant, entitled the owner of the reversionary interest to the award even though the determinable fee had not previously terminated; and (3) whether, under the evidence in this case, expiration of the determinable fee was imminent and therefore authorized recovery of the award, in whole or in part, by the owners of the reversionary interest.

By a deed dated February 26, 1929, Mr. and Mrs. Wilbur F. Chandler conveyed a large parcel of property to the City of Fresno for use as an airport. This is known as the Chandler grant. The deed effecting such conveyance provided that the property therein described was conveyed to the City 'for and during the time * * * [it] shall be used as a Municipal Air Port, and for no other purpose.' By subsequent agreement, the parties to this deed modified the terms thereof respecting the use of the property theretofore conveyed by providing that title and ownership thereto 'shall be for the time said real property shall be used for municipal purposes including municipal airport purposes and for no other.'

The site in question approximated 100 acres; additional adjoining property was acquired by the City; and the total thereof has been used as an airport known as Chandler Air Field.

On July 9, 1959, the State of California commenced the instant action, an eminent domain proceeding, to acquire an approximate 2 acre strip across the northeasterly part of the airport for highway purposes. This strip severed the airport property, leaving a three acre triangular parcel to the northeast, and a 191 acre parcel to the south and west. The city of Fresno and the owners of the reversionary interest, who acquired the same through inheritance and are known as the Chandler heirs, were named defendants. The trial court approved the taking by the State; found that the City's estate in the property taken had been terminated; determined that the value of the property taken was $12,172.50; concluded that the heirs alone were entitled to the award for this amount; found that the City had been damaged by the taking in that it has been required to make certain changes with respect to its airport facilities on account thereof; and allowed it $3541.91 as compensation for such damages. Judgment was entered accordingly. The City appeals and, as appellant herein, contends that it should have been awarded the value of the property taken. The Chandler heirs resist the appeal and, as respondents herein, contend that the award to them was proper.

The nature of the estate conveyed to the City by the deed from Mr. and Mrs. Chandler, as modified by the subsequent agreement between them, is a factor material to a consideration of the arguments presented by the parties hereto in support of their respective contentions. Each of them assumes that the estate so conveyed was a determinable fee and address their arguments accordingly. Without passing upon the correctness of this assumption, we will accept the same for the purpose of this decision. An appreciation of its materiality to the issues at hand requires a consideration of the distinction between a determinable fee estate and an estate upon condition.

A determinable fee in real property is one subject to a contingency upon the happening of which the fee terminates ipso facto and title to the property reverts to the grantor. (Renner v. Huntington etc. Oil & Gas Co., 39 Cal.2d 93, 98, 244 P.2d 895; Henck v. Lake Hemet Water Co., 9 Cal.2d 136, 140, 69 P.2d 849; Taylor v. McCowen, 154 Cal. 798, 803-804, 99 P. 351; Alamo School Dist. v. Jones, 182 Cal.App.2d 180, 184, 6 Cal.Rptr. 272.) No notice, declaration of forfeiture or other act of the grantor is required to effect such termination or reversion. (Renner v. Huntington etc. Oil & Gas Co., supra, 39 Cal.2d 93, 98, 244 P.2d 895; Henck v. Lake Hemet Water Co., supra, 9 Cal.2d 136, 140, 69 P.2d 849.) These factors distinguish a determinable fee estate from an estate on condition, usually referred to as a condition subsequent. The latter estate also is subject to a contingency but the happening thereof does not effect termination of the estate ipso facto; confers merely a right to terminate; and divestiture occurs only upon positive action by the grantor, after condition broken, indicating an election to terminate. (Henck v. Lake Hemet Water Co., supra, 9 Cal.2d 136, 140, 69 P.2d 849; Taylor v. McCowen, supra, 154 Cal. 798, 803, 99 P. 351; Alamo School Dist. v. Jones, supra, 182 Cal.App.2d 180, 185, 6 Cal.Rptr. 273; Generally see 2 Witkin, Summary of Cal.Law [7th ed.] p. 949.)

The reversionary interest of the grantor of a determinable fee has been defined as a possibility of reverter, while that of the grantor of an estate on condition has been defined as a right of reentry. (Alamo School Dist. v. Jones, supra, 182 Cal.App.2d 180, 184-185, 6 Cal.Rptr. 273.) Under the common law neither the possibility of reverter nor the right of reentry was transferrable, being considered a naked possibility. (Johnston v. City of Los Angeles, 176 Cal. 479, 485, 168 P. 1047; 24 Cal.L.Rev. 512, 518.) However, in California, the transferability of the reversionary interest incident to a conditional estate has been effected by statute. (Civ.Code, § 1046; Johnston v. City of Los Angeles, supra, 176 Cal. 479, 485-486, 168 P. 1047; Alamo School Dist. v. Jones, supra, 182 Cal.App.2d 180, 185, 6 Cal.Rptr. 273.) Whether this statute applies to the reversionary interest incident to a determinable fee has been the subject of divergent views. (Johnston v. City of Los Angeles, supra, 176 Cal. 479, 486, 168 P. 1047; Victoria Hospital Assoc. v. All persons, 169 Cal. 455, 465, 147 P. 124; 2 Witkin, Summary of Cal.Law [7th ed.] 974; 24 Cal.L.Rev. 512, 523; 18 Cal.Jur.2d 397, 398.) In the case at bar both parties assume transferability of the possibility of reverter attendant upon a determinable fee. No issue is raised respecting the Chandler heirs' ownership of the reversionary interest at hand. Neither is there any contention that such a reversionary interest may not be a subject of ownership.

The trial court found that the City acquired a determinable fee in the property conveyed to it by the Chandlers; that all of this property, except that portion thereof taken by the State for highway purposes, 'has been used at all times and is now used by said City of Fresno for municipal purposes'; that an order authorizing the State to take immediate possession of the highway strip was made on July 17, 1959, and pursuant thereto physical possession thereof was taken on January 19, 1960; that, commencing on May 17, 1954, the City leased two billboard sites on the northeasterly corner of the Chandler grant to an outdoor advertising company for private commercial advertising purposes; that these billboards did not interfere with the use of the Chandler grant for airport purposes; that on April 18, 1957, the City of Fresno adopted a master development plan for the use of Chandler Field; that this plan indicated a state highway use of that part of the airport included within the strip thereafter taken through the instant proceedings; that on September 7, 1958, the California Highway Commission adopted a resolution directing acquisition of this strip for highway purposes; that on January 13, 1960, the City commenced, and on January 18, 1960 completed removal of an airstrip boundary light as well as boundary fences which were located on the condemned parcel; and that 'by reason of the facts hereinbefore found, the City of Fresno ceased to use Parcel 1 [the strip of land taken by the State] for municipal airport purposes or for any municipal purpose, and Parcel 1 ceased to be used for municipal purposes or municipal airport purposes.'

The materiality of the finding of cessation of use lies in its association with the contention that the City's estate in the condemned property had terminated prior to or at the time of the taking; that upon cessation, title thereto ipso facto had reverted to the Chandler heirs; and that, for this reason, they are entitled to the award. The finding in question is not directed to any specific point of time. Insofar as it refers to the use of the property after the taking occurred its significance will be considered later in this opinion. Insofar as it relates to the use of the property prior to the taking, the sufficiency of the evidence to support the same is attacked by the appellant City.

SUFFICIENCY OF THE EVIDENCE

The finding of cessation of use, upon its face, is an inference drawn by the court from other facts...