State Land Dept. v. Painted Desert Park, Inc.

• Decision Date: 31 May 1967
• Docket Number: No. 7752--PR,7752--PR
• Citation: 102 Ariz. 272,428 P.2d 424
• Parties: STATE LAND DEPARTMENT, Appellant, v. PAINTED DESERT PARK, INC., Appellee.
• Court: Arizona Supreme Court

Page 424

428 P.2d 424

102 Ariz. 272

STATE LAND DEPARTMENT, Appellant, v. PAINTED DESERT PARK, INC., Appellee.

No. 7752--PR.

Supreme Court of Arizona, In Banc.

May 31, 1967.

Rehearing Denied July 6, 1967.

Darrell F. Smith, Atty. Gen., Robert W. Pickrell, Former Atty. Gen., Charles C. Royall, Former Asst. Atty. Gen., Phoenix, for appellant.

Earl Platt, St. Johns, for appellee.

McFARLAND, Justice.

Painted Desert Park, Inc., herein referred to as the corporation, has been granted review of the decision of the Arizona Court of Appeals in the case of State Land Department v. Painted Desert Park, Inc., 3 Ariz.App. 568, 416 P.2d 989. The corporation's claim has previously been considered by the Arizona State Land Commissioner and the Board of Appeals of the Arizona State Land Department. A consolidated appeal was taken from the decision of these bodies to the Superior Court of Arizona in and for the County of Apache. That court rendered judgment in favor of the corporation and against the State of Arizona in the amount of $48,000.

The corporation and its predecessors leased a parcel of state school land for commercial purposes for many years. The land abutted U. S. Highway 66. Improvements were placed on the land, and a trading-post business was developed on the property. Over the years the annual rent which the corporation paid the state for the use of the land increased from $19.50 to $1,000. By the terms of the lease, the corporation's lease was to expire in June of 1960. Sometime prior to the expiration date of the lease, the State Land Department granted an easement for a non-access highway to the State of Arizona on application of the State Highway Department. The effect of this transaction was that Highway 66 was rerouted across the corporation's property. The old Highway 66 that passed the corporation's trading post was obliterated, and there was no ready access to the corporation's improvements. Thereafter, no actual commercial use was made of the leased property. Nevertheless the corporation made timely application for renewal of its lease, and tendered payment of the annual rental for the renewal which was duly receipted by the land department. The advance rental payment was subsequently refunded, and, on June 23, 1960, the land commissioner denied the corporation's renewal application on the grounds that it was not in the best interest of the state to continue leasing the subject land for commercial purposes since the land could not be used for the purpose applied for, and that it was 'to the best interest of the state to restore subject land to the public domain of the United States for National Park purposes, and then in exchange obtain public domain land of equal value within Navajo or Apache County from which the schools of the State can derive a benefit.' At the time of the denial of a renewal, the commissioner directed that an appraisal be made for the purpose of fixing the value of the improvements.

The commissioner then determined on August 15, 1960, that the corporation should take nothing for its improvements, finding them to be of no value.

The board of appeals, in review of the commissioner's decision in respect to valuation of the improvements, ordered that the corporation was entitled to remove from the leased premises certain removable improvements, including a walk-in refrigerator, a pipeline, and petrified wood. The conclusions reached by the board were that the improvements placed upon the land prior to June 25, 1952, were to be determined by the actual value of the land with and without the improvements, and that these improvements did not enhance the value of the land. The board further decided that the corporation was not entitled to reimbursement for the improvements placed on the land after June 25, 1952, if any, because the corporation had not sought prior approval as required by law, and because the improvements did not enhance the value of the land, in that they have no current value, and their condition at that time was so poor that a prudent person would not expend funds to recondition them.

The corporation then appealed to the superior court for a trial de novo pursuant to A.R.S. § 37--214, which provides in part:

'* * * The appeal shall be heard de novo at the earliest practical time by the court without a jury. The court shall hear evidence, make independent findings of fact and conclusions of law from the evidence submitted, and shall either affirm, reverse or modify the decision appealed from. * * *'

The superior court rendered judgment affirming the decision of the land commissioner denying the corporation's application to renew its lease, but reversing the decision of the board of appeals of the land department denying the corporation reimbursement for improvements. The superior court ordered:

'3. That Appellant have and recover Judgment against the State of Arizona, to be paid in the manner provided by law, for the value of Appellant's reimbursable improvements as follows:

"Buildings as shown in Appellant's list of improvements filed

                with the state land department                                  $ 37,000.00
                "Less cost of necessary repairs                                    3,000.00
                                                                               ------------
                "New Valuation for reimbursement purposes                       $ 34,000.00
                "Land leveling at business site including imported gravel          8,500.00
                "Buried pipe line on leased premises                               4,700.00
                "Walk-in box not removable without destruction of building           800.00
                                                                               ------------
                Total reimbursable value of improvements                       $ 48,000.00"
                

The first question presented in this appeal is the corporation's assertion that the land department was estopped to deny a renewal of the lease because the land department was dilatory in refusing the corporation's application for renewal and in returning the tender made with the application. For this reason the corporation contends the trial court erred in finding the land commissioner did not abuse his discretion in failing to renew the lease. This, and any other arguments which the corporation makes concerning errors in the findings, conclusions and judgment of the superior court are not properly before this court, as the corporation has failed to file any notice of appeal or cross-appeal from the judgment of the superior court denying renewal of the lease. In Maricopa County v. Corporation Commission of Arizona, 79 Ariz. 307, 289 P.2d 183, this Court said:

'* * * if appellee in its brief seeks only to support or defend and uphold the judgment of the lower court from which the opposing party appeals, a cross-appeal is not necessary. Gillespie Land & Irrigation Co. v. Jones, 63 Ariz. 535, 164 P.2d 456; 4 C.J.S. Appeal and Error § 1299. If, however, it is sought by such cross-assignments to attack said judgment with a view either of 'enlarging his own rights thereunder or of lessening the rights of his adversary' he must cross-appeal by conforming with the rules of court by giving notice of appeal. United States v. American Ry. Express Co., 265 U.S. 425, 435, 44 S.Ct. 560, 564, 68 L.Ed. 1087. In the absence of a cross-appeal the appellee can defend only as to items allowed below and cannot present rejected claims. * * *' 79 Ariz. at 310, 289 P.2d at 185.

To analyze the decision of the superior court in the instant case we must keep in mind the established principles which govern reivew by trial de novo from administrative decisions. In Ehle v. Tenney Trading Co., 56 Ariz. 241, 107 P.2d 210, we said:

'* * * While the trial court tries lease cases De novo, in Manning v. Perry, 48 Ariz. 425, 62 P.2d 693, we declared the rule to be that the decision of the land department should be accepted by the court, unless unsupported by or contrary to the evidence, or the result of fraud, or misapplication of the law, and we think that rule should be adhered to. * * *' 56 Ariz. at 243, 244, 107 P.2d at 211.

The instant action was tried de novo after consolidating the corporation's separate claims dealing with (1) the denial of the lease-renewal application, and (2) the finding that the corporation was not entitled to any compensation for improvements on the property. The superior court has jurisdiction to try de novo, on appeal, matters arising before the land department and decided therein. A.R.S. § 37--214. Williams v. Greene, 95 Ariz. 378, 390 P.2d 907; Montierth v. State Land Department, 84 Ariz. 100, 324 P.2d 228. But appellate jurisdiction is circumscribed by statute. Knape v. Brown, 86 Ariz. 158, 342 P.2d 195. A.R.S. § 37--214 provides only that the superior court, on trial de novo 'shall either affirm, reverse, or modify the decision appealed from.' Consideration of a similar provision relating to the Arizona Corporation Commission (A.R.S. § 40--254) led this court, in Arizona Corporation Commission v. Fred Harvey Transportation Co., 95 Ariz. 185, 388 P.2d 236, to conclude:

'* * * the hearing before the superior court is De novo and we have construed this to mean the superior court must exercise an 'independent judgment'. * * * This only means that the trial court is empowered to reach an independent conclusion. It does not mean that the superior court may enter a judgment independent and free of the confining language of the statute. * * *' 95 Ariz. at 190, 191, 388 P.2d at 239.

In Rojas v. Kimble, 89 Ariz. 276, 361 P.2d 403, we said:

'While a trial de novo means a new trial as though it were one of original jurisdiction in the superior court, this does not mean that the superior court may treat the action as though it had actually been commenced therein in order to escape jurisdictional limitation imposed by the Constitution and statutes. Jurisdictional limitations to hear and determine the case remain the same as were imposed upon the court from...