State ex rel. State Highway Commission v. Mahon

Decision Date02 October 1961
Docket NumberNo. 23416,23416
Citation350 S.W.2d 111
PartiesSTATE ex rel. State of Missouri, STATE HIGHWAY COMMISSION of Missouri, Plaintiff, v. Paul A. MAHON et al., Respondents, Oliver Doerflinger, d/b/a Oliver Oil Co., Appellant.
CourtMissouri Court of Appeals

Ike Skelton, Lexington, for appellant.

Harvey Burrus, Independence, for respondents.

MAUGHMER, Commissioner.

This appeal was originally lodged in the Supreme Court. That court by its opinion (State ex rel. State Highway Commission v. Mahon, Mo., 343 S.W.2d 165) ruled it did not have jurisdiction and transferred the cause here. We believe the summarization of facts contained in that opinion to be complete and sufficient for our purposes. It is therefore adopted and incorporated herein.

In this case plaintiff condemned a tract of land containing 2.435 acres located on U. S. Highway 40 near Odessa, Missouri. Respondents Paul H. and Dolin Mahon were the owners of the land. Appellant, Oliver Doerflinger, d/b/a Oliver Oil Company, was in possession of the premises as lessee under a five-year written lease which was to expire on March 15, 1963. A filling station building and a restaurant building were located on the premises. Appellant operated the filling station and had sublet the restaurant building to defendants Jesse H. and Edna Stenbell upon a month-to-month tenancy at a rental of $50 per month. Appellant was required to vacate the premises 42 months before the expiration of the lease.

The commissioners awarded damages for the appropriation of the property in the sum of $13,920. Separate exceptions were filed by appellant and respondents. There had been no trial of these exceptions at the time this appeal was taken. Plaintiff paid the amount of the award to the circuit clerk who issued a check in that amount payable to all defendants who were alleged to have an interest in this land. The parties were unable to agree upon a division of the money and respondents thereafter filed a motion in which they alleged that they were entitled to the entire award and prayed that the court so adjudicate. The court heard evidence offered by respondents and appellant (the Stenbells apparently making no claim to any part of the award), made a finding that appellant's lease 'had no value at the time of the taking or appropriation of said land by plaintiff,' and adjudged that the whole amount of the award be paid by the clerk to respondents. Appellant's motion for judgment or in the alternative for a new trial was overruled and he has appealed to this court.

The lease provided that appellant should pay respondents a rental computed on the basis of 'one (1) cent per gallon on each gallon of gasoline dispensed on the premises and one-half (1/2) cent per gallon on each gallon of diesel fuel and kerosene dispensed on the premises, said rent being due and payable on the 10th day of each month hereafter.' The testimony indicated that the rent, so computed, averaged approximately $150 per month. Appellant testified that before he commenced business on the premises he spent $685 in repairing and painting the buildings; that he erected signs and installed eight pumps and six storage tanks; that the cost of removing the signs, tanks and pumps was about $750; that he had expected to amortize all of those expenses over the 60-month period of the lease but was required to vacate after 18 months. He also testified that during the period he operated under the lease his average net profit was $451.44 per month; that during the remaining period of the lease his profit, computed according to his 18-months' experience, would have been $18,860. An expert in mathematics testified that at an assumed interest rate of 4% the present cash value of appellant's anticipated future profit during the 42-month period would be $16,900.

The State Highway Commission is authorized to condemn lands for highway purposes by the provisions of Chapter 523. (See also Secs. 227.120(13) and 226.270) V.A.M.S. The report of the commissioners appointed to assess the damages is subject to timely exceptions filed by either party. Secs. 523.050, 523.060. Section 523.050 provides that after written exceptions are filed 'the court shall make such order therein as right and justice may require and may order a new appraisement, upon good cause shown.' However, the law is well established that when a party files such exceptions and asks for a jury to assess the damages, he is entitled to a jury trial as a matter of right (Sec. 523.060) and a formal order of court setting aside the commissioners' report is not required. State ex rel. Highway Commission of Missouri v. Curtis, 365 Mo. 447, 283 S.W.2d 458, 464, 465.

It seems clear in the state that where there are different interests or estates in the condemned property, the proper course is to ascertain the entire compensation as though the property belonged to one person and then apportion this sum among the different parties according to their respective rights. The value of property cannot be enhanced by any distribution of the title or estate among different persons or by contract arrangements between the owner and a lessee. This question was reviewed by the Supreme Court en banc in State ex rel. McCaskill v. Hall, 325 Mo. 165, 28 S.W.2d 80, 82, 69 A.L.R. 1256, and again in City of St. Louis v. Rossi, 333 Mo. 1092, 64 S.W.2d 600. The reasoning and the result of those two cases on this point was recently summarized by the same court in State ex rel. State Highway Commission of Missouri v. Conrad, Mo., 310 S.W.2d 871, 877, as follows: '* * * the appoved method is to assess in one sum the damages of all interests in a particular lot or tract, 'leaving the owners of the fee, lessees, trustees, mortgagees, and sublessees to apply to the circuit court for apportionment of the damages between them according to their various interests.' Such has been the routine procedure in many of our circuit courts for years.' In condemnation actions of this nature the judgment is in rem and not in personam. City of St. Louis v. Koch, 169 Mo. 587, 70 S.W. 143, 144; State ex rel. Scott v. Trimble, 308, Mo. 123 272 S.W. 66.

In the usual cicil suit the losing litigant does not pay nor is he required to pay until a final judgment has been entered against him. However, our legislative bodies decided that our State Highway Commission (among others granted the right of eminent domain) should not be required to await the final outcome of extended litigation before commencing construction of a needed highway and so enacted Section 523.040, which provided a method by which such delay might be eliminated. This section, after requiring that commissioners be appointed and directing that their report be filed with the clerk, continues: '* * * and thereupon such company shall pay to the said clerk the amount thus assessed for the party in whose favor such damages have been assessed; and on making such payment it shall be lawful for such company to hold the interest in the property so appropriated for the uses aforesaid; * * *'. 'The fact that the owners of the constitutive interests may not agree as to the apportionment among themselves of the sum awarded is merely an incident growing out of such combined ownership for which the condemnor is in no way responsible.' State ex rel. McCaskill v. Hall, supra, [325 Mo. 165, 28 S.W.2d 82] and State v. Conrad, supra. The Supreme Court (State ex rel. State Highway Commission v. Deutschman et al., 346 Mo. 755, 142 S.W.2d 1025, 1028) adopted the following quotation from School District of Kansas City v. Phoenix Land & Improvement Co., 297 Mo. 332, 249 S.W. 51, 53, as descriptive of the status of the matter when exceptions to the commissioners' report had been filed and were pending: '* * * the report of the commissioners became functus officio and the cause then stood as though no commissioners had ever been appointed'.

When this appeal is considered we are quickly confronted with this question: Is the order (or judgment) entered a final judgment within purview of the statutes authorizing an appeal only from a final judgment or has this appeal been launched prematurely? The Supreme Court in its transfer opinion, which considered only the question of jurisdiction, was cognizant of this question and commented: 'It would appear that the apportionment between the owner and lessee could,...

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