United States v. 1,997.66 ACRES OF LAND, MORE OR LESS, ETC.

• Decision Date: 13 August 1943
• Docket Number: No. 12483.,12483.
• Parties: UNITED STATES v. 1,997.66 ACRES OF LAND, MORE OR LESS, IN POLK COUNTY, IOWA, et al.
• Court: U.S. Court of Appeals — Eighth Circuit

137 F.2d 8 (1943)

UNITED STATES v. 1,997.66 ACRES OF LAND, MORE OR LESS, IN POLK COUNTY, IOWA, et al.

No. 12483.

Circuit Court of Appeals, Eighth Circuit.

July 7, 1943.

Rehearing Denied August 13, 1943.

COPYRIGHT MATERIAL OMITTED

Vernon L. Wilkinson, Atty., Department of Justice, of Washington, D. C. (Norman M. Littell, Asst. Atty. Gen., Maurice F. Donegan, U. S. Atty., of Davenport, Iowa, Daniel F. Steck, Sp. Asst. to the Atty. Gen., and S. Billingsley Hill, Atty., Department of Justice, of Washington, D. C., on the brief), for appellant.

Hallagan, Fountain, Steward & Cless and P. H. Cless, all of Des Moines, Iowa, for appellee W. J. Porter and others.

Lappen & Carlson and Eskil C. Carlson, all of Des Moines, Iowa, for appellee John E. Lundstrom and others.

Before STONE, WOODROUGH, and JOHNSEN, Circuit Judges.

JOHNSEN, Circuit Judge.

Three questions under the Declaration of Taking Act of February 26, 1931, 46 Stat. 1421, 1422, 40 U.S.C.A. §§ 258a-258e, are here involved.

The first is whether it is contemplated under the Act that the United States shall have any right to amend the declaration of taking filed in a condemnation proceeding, for the purpose of reducing an erroneous estimate of just compensation for the land taken, and to permit the Government to withdraw the excess of the cash deposited over the revised estimate.

The second is whether, if it is contemplated under the Act that such right shall exist in the United States, the district court has a discretion to refuse to allow the Government thus to revise its compensation estimate and to withdraw the deposit excess, where the officer or authority, empowered by law to acquire the land through condemnation, clearly is acting in good faith and has certified that the amendment and revision are being made because appraisal information obtained subsequent to the filing of the declaration of taking has demonstrated that the original estimate of just compensation is inaccurate.

The third is whether, where the district court in such a situation has refused to allow the Government to amend and reduce its compensation estimate and to make a withdrawal of the deposit difference, but has withheld payment to the landowner of the excess over the revised estimate, and the final award on a trial of the proceeding exceeds the amount of the revised estimate, the Government properly is chargeable with interest on the difference between the final award and the revised estimate, or on that between such award and the original estimate.

The questions arise on an appeal taken by the United States, in a condemnation proceeding caused to be instituted by the Secretary of War, to acquire a site for an ordnance testing area near Des Moines, Iowa. Congress had duly appropriated the funds for acquiring the land. A declaration of taking signed by the Secretary was filed in the proceeding, stating that the gross sum of money estimated by him to be just compensation for all the land taken was $208,080. This amount was deposited in the registry of the court. The total land involved was 1,997.66 acres, in a number of separate tracts and ownerships, and a just-compensation estimate or allocation for each parcel was accordingly contained in the declaration of taking.

Before any part of the money had been paid out to the respective landowners, and before there had been any attempt to obtain possession of the property, the Government sought to file an amended declaration of taking, changing the estimates of just compensation which had been made for a number of the tracts. Some of the estimates were reduced and some were increased. The gross amount of the revised estimates, however, was only $171,575, leaving a difference of $36,505 between the original and the revised estimates. The Government asked leave to withdraw this excess from the registry of the court. The Secretary had certified in the amended declaration of taking that "appraisal information obtained subsequent to the filing of the original declaration of taking demonstrates that the amounts deposited as estimated compensation are inaccurate."

There were some errors in description and in the names of owners of the property, which the amended declaration of taking sought also to correct. The court allowed the amended declaration of taking to be filed for the purpose of correcting the errors in description and ownership, but refused to permit it to have any legal effect to revise the compensation estimates in the original declaration. The court did, however, withhold payment of any difference between the two estimates from the landowners, and retained the excess in the registry of the court. On the tracts where the ultimate award by the jury exceeded the amount that had been paid out to the landowners, the court in the final judgment charged the Government with interest on the difference between the verdict and the original or the amended estimate, whichever was the lower.

The appeal here is from the judgments entered in connection with eight tracts of land, referred to in the proceedings as parcels numbers 7, 8, 14, 16, 19, 69, 70 and 71. No question is raised with respect to the jury's verdicts, but the Government challenges the construction made by the lower court of the Declaration of Taking Act, in refusing to allow any amendment of the estimates of just compensation stated in the declaration of taking, and the relation of this construction to the amount of interest with which the Government was charged in the judgments.

The two principal purposes of Congress, in making provision in the Declaration of Taking Act for the estimating of just compensation and the depositing of the amount thereof in court, undoubtedly were to minimize the interest burden of the Government in a condemnation proceeding, and to alleviate the temporary hardship to the landowner and the occupant from the immediate taking and deprivation of possession. United States v. Miller, 317 U.S. 369, 381, 63 S.Ct. 276, 283, 87 L.Ed. ___; Atlantic Coast Line R. Co. v. United States, 5 Cir., 132 F.2d 959.

The number and the scope of the emergency condemnations, to which the Government has had to resort in acquiring necessary properties for the present war effort, have given to the deposit and interest aspect of such proceedings a compelling significance. Since the attack upon Pearl Harbor, governmental authorities have deemed it necessary to make deposits in court, under declarations of taking, of some 75 million dollars of public funds, in order to acquire immediate title and possession of lands in condemnation. The avoidance of a six per cent interest load upon the huge sums thus involved manifestly is a matter of some concern to the taxpaying public. So, too, if the deposits made have been excessive, through error or inaccuracy in the estimating of just compensation, the public has a similar interest in having the error corrected and the excess funds returned to the Government, so they will not remain burdensomely idle but may be put to other necessary uses.

It is not unnatural in this emergency situation that exigent takings have had to be made where the procurable value-data was unavoidably imperfect or incomplete, and that cautionary appraisal re-checking should thereafter demonstrate that some of the original estimates of just compensation were inadvertently incorrect. If the estimate has been too low, fairness to the landowner obviously suggests that the estimate and deposit ought to be increased. If the estimate has been too high, fairness to the public correlatively suggests that the estimate and deposit should be permitted to be reduced.

It would thus seem that, as a matter of fairness and sound practicality, the right should exist in the Government to amend its declaration of taking, for the purpose of correcting an erroneous estimate of just compensation and of enabling the Government to withdraw any excess of public funds deposited, in order to apply them to other uses and to prevent waste. The Declaration of Taking Act ought therefore to be construed as being consistent with the existence of such a right, unless this construction will do violence to the legislative language or to some substantive right of the landowner, created by the Act or otherwise existing.

There can be no violence done by such a construction to any substantive right of the landowner existing outside the Act itself. Except as some fixed right may have been intended to be created by the Act itself, —which question will be presently considered —all that is fundamentally involved is the landowner's basic right of not being deprived of his property without ultimate just compensation. In a constitutional sense, that right can in no way be claimed to be infringed by the mere fact that ascertainment and payment of the amount of just compensation have not been made before the property is taken. Yearsley v. W. A. Ross Construction Co., 309 U.S. 18, 21, 22, 60 S.Ct. 413, 415, 84 L.Ed. 554; George Moore Ice Cream Co., Inc., v. Rose, 289 U.S. 373, 382, 53 S.Ct. 620, 623, 77 L.Ed. 1265; Hurley v. Kincaid, 285 U.S. 95, 104, 105, 52 S.Ct. 267, 269, 76 L.Ed. 637; Commercial Station Post Office, Inc., v. United States, 8 Cir., 48 F.2d 183. The Act here facilitates the vindication of the landowner's basic right by providing that, without regard to the amount of the estimate and deposit in the proceeding, the right to just compensation "shall vest in the persons entitled thereto; and said compensation shall be ascertained and awarded in said proceeding and established by judgment therein * * *." 46 Stat. 1421, 40 U.S.C.A. § 258a.

We turn then to a consideration of whether the Act itself was intended to create some fixed or absolute right in favor of the landowner which would be violated by a construction allowing the filing of an amended compensation estimate to correct an inadvertent error or inaccuracy in appraisal. The question is one upon which apparently, up to the...