United States v. 19.86 Acres of Land in East St. Louis

• Decision Date: 16 March 1944
• Docket Number: No. 8395.,8395.
• Citation: 151 ALR 1423,141 F.2d 344
• Parties: UNITED STATES v. 19.86 ACRES OF LAND IN EAST ST. LOUIS, ST. CLAIR COUNTY, ILL., et al.
• Court: U.S. Court of Appeals — Seventh Circuit

151 ALR 1423, 141 F.2d 344 (1944)

UNITED STATES v. 19.86 ACRES OF LAND IN EAST ST. LOUIS, ST. CLAIR COUNTY, ILL., et al.

No. 8395.

Circuit Court of Appeals, Seventh Circuit.

March 16, 1944.

Ray M. Foreman, of Danville, Ill., George R. Schwarz, of Jerseyville, Ill., and Norman M. Littell, Vernon L. Wilkinson, Lawrence Vold, and Norman MacDonald, Dept. of Justice, all of Washington, D. C., for appellant.

Harold G. Baker and Leigh M. Kagy, both of East St. Louis, Ill. (Baker, Lesemann, Kagy & Wagner, of East St. Louis, Ill., of counsel), for appellee Jos. Greenspon's Son Pipe Corporation.

Before MAJOR, KERNER, and MINTON, Circuit Judges.

MAJOR, Circuit Judge.

This is an appeal from a judgment, entered April 27, 1943, dismissing a condemnation proceeding as to appellee, Jos. Greenspon's Son Pipe Corp., and a certain building located on the condemned land, ownership of which was claimed by it. The proceeding was instituted under authority of the Navy Appropriation Act of July 29, 1941, 55 Stat. 608, and the General Condemnation Act of August 1, 1888, Sec. 1, 25 Stat. 357, 40 U.S.C.A. § 257. The former Act authorizes the Secretary of the Navy to acquire lands with the approval of the President, and the latter Act confers upon any officer of the government, authorized to procure real estate for the erection of a public building or for other public uses, the right to acquire the same by condemnation.

The proceeding, commenced January 12, 1942, described 19.86 acres of land to be taken for Naval purposes in connection with the expansion of the Westcott Valve Company in East St. Louis. Title to the land at that time was in the Illinois State Trust Company and certain designated trustees who were made parties. There was located upon the land the factory building in controversy. On December 2, 1941, after considerable negotiation, a written agreement was executed by which appellee agreed to pay the sum of $5,000 for the building, title to be taken in the name of one Joseph Edlin as trustee. The agreement expressly provided that the sale covered only the materials of which the building was constructed, which constituted personal property, and that the sale was not "of any interest in the building or premises as real property." The rights of Joseph Edlin as trustee were assigned to appellee by written assignment dated December 27, 1941. Prior to appellee's agreement to purchase, the trustees had attempted without success to sell the lands and the building to Westcott Valve Company, which was producing valves for the Navy. The Valve Company agreed to purchase the land, provided the building was removed on or before February 10, 1942. Appellee, after its purchase of the building, commenced to dismantle and remove the materials therefrom in accordance with its written contract of December 2, 1941. On December 16, 1941, officers of the United States Navy Department requested appellee to cease dismantling and removing such materials. With this request appellee complied.

Appellee was not made a party to the condemnation proceeding until May 12, 1942. On October 21, 1942, the District Court entered an order entitled "Judgment and Decree of the Court," based upon a stipulation between the government and the Illinois State Trust Company, a corporation, and said trustees (owners of the fee), to which stipulation the appellee was not a party. It was recited in said judgment that the Trust Company and its trustees were the owners in fee simple of the lands sought to be condemned but that such interest was subject to the interest of appellee in and to certain improvements which were located upon the premises. It was recited in the judgment that the parties had agreed that $19,000 was just compensation for the unencumbered fee simple title to the lands with the improvements thereon, with the exception of appellee's interest in and to certain improvements. It was also recited that $5,000 had been deposited for the taking of such interest.

On December 18, 1942, appellee, by motion to dismiss, challenged the authority of the Secretary of the Navy to condemn the building in controversy, on the theory that it was personal property and therefore not within the terms of the Act relied upon. It is from the court's order sustaining this motion that the instant appeal comes. In allowing the motion, the court stated:

"And the Court having found that before the case was filed the building had been constructively severed from the soil and had become personal property owned by said Joseph Greenspon's Son Pipe Corporation and that the Government had notice or was put upon notice of such constructive severance prior to filing the case: Further the Government had no authority under the statute to take personal property under its right of eminent domain and therefore no authority to take the building in question which had theretofore become personal property."

Thus, the question for decision is whether the building was personal property so as to preclude the government from acquiring it under a statute authorizing the condemnation of real property. The government does not dispute that it had notice, prior to the commencement of the suit, of appellee's alleged ownership of the building. The government does contend, however, that such notice is immaterial.

Appellee contends that the character of the property, that is, whether it is real or personal, must be determined in accordance with local law. The government in its brief makes no mention of this point, but in oral argument before this court contended that the local law is without application since United States v. Miller et al., 317 U.S. 369, on page 379, 63 S.Ct. 276, on page 283, 87 L.Ed. 336, 147 A.L.R. 55, wherein the court said:

"We need not determine what is the local law, for the federal statutes upon which reliance is placed require only that, in condemnation proceedings, a federal court shall adopt the forms and methods of procedure afforded by the law of the State in which the court sits. They do not, and could not, affect questions of substantive right — such as the measure of compensation — grounded upon the Constitution of the United States."

We are of the view that this pronouncement does not support the government's contention. What the court evidently meant was that the forms and methods of procedure afforded by the law of the state do not affect questions of substantive right. That the character of property taken in condemnation is to be determined by local law seems to have been recognized in the subsequent case of United States ex rel. T.V.A. v. Powelson, 319 U. S. 266, on page 279, 63 S.Ct. 1047, on page 1054, 87 L.Ed. 1390, wherein the court stated:

"Though the meaning of `property' as used in § 25 of the Act and in the Fifth Amendment is a federal question, it will normally obtain its content by reference to local law."

We agree with the holding in United States v. Becktold Company, 8 Cir., 129 F. 2d 473, 477, wherein the court, in a condemnation proceeding, stated:

"Whether or not these fixtures and machinery under the facts disclosed constituted a part of the realty was dependent upon the law of the State of Missouri, the lex loci rei sitae. This was a question of real estate law which must always be determined by the law of the state in which the realty is located." (Citing cases.)

The government, having taken the position that local law is not controlling, has given us no assistance in ascertaining the Illinois rule. Our own investigation, however, has convinced us that there is no rule in Illinois as contended for by appellee. Certainly there is no case in point, and it is difficult to visualize how the instant question could get before an Illinois court, for the reason that both the Constitution of the State (Article II, § 13), Smith-Hurd Stats. and its Eminent Domain Act (Chap. 47, § 1), authorize the taking of private property, which includes both realty and personalty.

We need not cite authorities in support of the general and perhaps universal rule in Illinois and elsewhere that a building permanently connected with the soil is real property. Only a clear and pointed case would justify the conclusion that there is any limitation upon this general rule which would control in a proceeding of the instant...