Southern Pacific Land Company v. United States, 19882.

• Decision Date: 18 November 1966
• Docket Number: No. 19882.,19882.
• Parties: SOUTHERN PACIFIC LAND COMPANY, Appellant, v. UNITED STATES of America, Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

367 F.2d 161 (1966)

SOUTHERN PACIFIC LAND COMPANY, Appellant, v. UNITED STATES of America, Appellee.

No. 19882.

United States Court of Appeals Ninth Circuit.

October 12, 1966.

Rehearing Denied November 18, 1966.

Galen McKnight, Fresno, Cal., Roy Jerome, Harold S. Lentz, San Francisco, Cal., Stammer, McKnight, Barnum, Bailey & Barnett, Fresno, Cal., for appellant.

Edwin L. Weisl, Jr., Asst. Atty. Gen., Roger P. Marquis, Atty., Dept. of Justice, Washington, D. C., Manuel L. Real, U. S. Atty., Richard J. Dauber, Asst. U. S. Atty., Los Angeles, Cal., for appellee.

Before HAMLEY, BROWNING and DUNIWAY, Circuit Judges.

BROWNING, Circuit Judge:

The United States seeks to condemn the fee simple title to 17,750 acres of land, including the mineral interests, for the construction of a naval air station near Lemoore, California. The Southern Pacific Land Company, owning 4,600 of these acres, contends that the mineral interests in the property cannot be taken. The Company argues that property may be taken only for a public purpose; that the only public purpose involved was the construction of a naval air station; that the Assistant Secretary did not determine that the taking of the mineral rights in the Company's lands was necessary for that purpose; and if he had, his determination would have been arbitrary and capricious, and an abuse of discretion, because the Company is willing to agree not to exploit these mineral rights unless and until it becomes possible to do so without interfering with the operation of the naval air station.

The district court held that since the establishment of a naval air station was a public use the inquiry must end there. "The extent, nature or estate to be acquired," the court held, "is solely within the province of the Assistant Secretary of the Navy by delegation from Congress and is not subject to judicial review." The district court went on, however, to hold there was "no evidence to support an allegation that the Assistant Secretary of the Navy acted in bad faith or arbitrarily or capriciously."¹

The Government urges us to adopt the district court's holding that when the taking as a whole is for an authorized public purpose the administrative agency's decision as to the necessity for taking particular property or a particular interest in property is not subject to judicial review.

A substantial argument can be made for this position, based upon the Supreme Court's decision in Berman v. Parker, 348 U.S. 26, 36, 75 S.Ct. 98, 99 L.Ed. 27 (1954), and upon such court of appeals decisions as 2953.15 Acres of Land v. United States, 350 F.2d 356, 360 (5th Cir. 1965); United States v. Mischke, 285 F.2d 628, 631-633 (8th Cir. 1961); United States v. Brondum, 272 F.2d 642, 646 (5th Cir. 1959); United States v. State of South Dakota, 212 F.2d 14 (8th Cir. 1954); United States v. Kansas City, 159 F.2d 125, 129 (10th Cir. 1946); and United States v. 6.74 Acres of Land, 148 F.2d 618, 619-620 (5th Cir. 1945). It is no doubt significant that in each instance in which a lower court set aside a federal agency's determination that it was necessary to take particular property or a particular interest in property, the lower court's ruling was reversed on appeal.

But the Supreme Court itself has declined to rule out the possibility of judicial review where the administrative decision to condemn a particular property or property interest is alleged to be arbitrary, capricious, or in bad faith. United States v. Carmack, 329 U.S. 230, 243-244, 67 S.Ct. 252, 91 L.Ed. 209 (1946). And various courts of appeal, including this one, have said that an exception to judicial non-reviewability exists in such circumstances. Simmonds v. United States, 199 F.2d 305, 306-307 (9th Cir. 1952); United States v. 64.88 Acres of Land, 244 F.2d 534, 536 (3rd Cir. 1957); United States v. Certain Real Estate, 217 F.2d 920, 926-927 (6th Cir. 1954); United States v. Certain Parcels of Land, 215 F.2d 140, 147 (3rd Cir. 1954); and United States v. Meyer, 113 F.2d 387, 392 (7th Cir. 1940). See also Wilson v. United States, 350 F.2d 901, 906-907 (10th Cir. 1965); United States v. 91.69 Acres of Land, 334 F.2d 229, 231 (4th Cir. 1964); and United States v. State of New York, 160 F.2d 479, 480 (2d Cir. 1947). Moreover, limited judicial review of administrative exercise of condemning authority may well be required by section 10 of the Administrative Procedure Act, 5 U.S.C. § 1009.

We need not decide the question, however, for even if we were to hold that a limited power of review exists, we would nevertheless affirm the judgment, since we agree with the district court that the Company failed to show that the decision to take its mineral rights was arbitrary, capricious, or made in bad faith.

An assistant Secretary of the Navy testified on deposition that extraction of the oil, gas or other minerals would be inconsistent with the establishment of the naval air station, and was not contemplated when the declaration of taking was filed. He testified that the mineral rights were included in the taking "to protect the government" in the event the property should no longer be needed for a naval air station at some time in the future.

In this eventuality the Assistant Secretary envisioned two possibilities. (1) If it were decided to sell the property, ownership of the mineral rights would enhance the property's marketability. Asked whether he had in mind "protecting the government in the sense of an investor," he responded, "not necessarily. Making it that much easier to sell. Part of it would be the investment, of course, but that wouldn't be the only factor." (2) If it were decided to retain the property, the Government might wish to extract the minerals, for "If oil can be produced from this land, who knows, in...