United States v. 2,353.28 Acres of Land, etc., State of Fla.

• Decision Date: 27 August 1969
• Docket Number: No. 26578.,26578.
• Citation: 414 F.2d 965
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. 2,353.28 ACRES OF LAND, MORE OR LESS, Situate IN the COUNTIES OF BREVARD AND VOLUSIA, STATE OF FLORIDA, and Lucille M. Bair, et al., Defendants-Appellants.
• Court: U.S. Court of Appeals — Fifth Circuit

414 F.2d 965 (1969)

UNITED STATES of America, Plaintiff-Appellee, v. 2,353.28 ACRES OF LAND, MORE OR LESS, Situate IN the COUNTIES OF BREVARD AND VOLUSIA, STATE OF FLORIDA, and Lucille M. Bair, et al., Defendants-Appellants.

No. 26578.

United States Court of Appeals Fifth Circuit.

July 21, 1969.

Rehearing Denied August 27, 1969.

Robert P. Smith, Jr., Chester Bedell, Nathan Bedell, Jacksonville, Fla., for appellants, Bedell, Bedell, Dittmar & Smith, Jacksonville, Fla., of counsel.

Edward F. Boardman, U.S. Atty., Tampa, Fla., Edmund B. Clark, Atty., U.S. Dept. of Justice, Clyde O. Martz, Roger P. Marquis, Asst. Attys. Gen., Washington, D.C., Francis G. Rearick, Trial Atty., Lands Division, U.S. Dept. of Justice, Orlando, Fla., Anthony C. Liotta, Philip M. Zeidner, Edmund B. Clark, Attys., Dept. of Justice, Washington, D.C., for appellee.

Before TUTTLE and GEWIN, Circuit Judges, and COMISKEY, District Judge.

GEWIN, Circuit Judge:

Trailblazing to the moon has made it necessary for the United States, exercising its power of eminent domain, to acquire large tracts of land here on earth. One such acquisition included 654.43 acres owned by appellant Colton, who received as just compensation for the taking an award fixed by a jury in the United States District Court for the Middle District of Florida.¹ The principal issue on this appeal is whether the district court erred, as the appellant contends, in disallowing evidence of enhancement in the land's value caused by the original establishment of a space facility to which the appellant's land was later added. We hold that this evidentiary exclusion by the district court was improper and that the judgment must be reversed.

The record before us provides an interesting account of early developments in our nation's manned lunar landing program, accelerated in May 1961 when President Kennedy called upon Congress and the country to send an American to the moon and back before the end of the decade.² The President's challenge was accepted and, as this opinion goes to the printer, two American astronauts prepare to depart from the moon after successfully landing there and exploring the lunar surface. An initial step in the implementation of this national goal was the selection of a launch site. Officials of the National Aeronautics and Space Administration, after considering various locations, selected Cape Canaveral, Florida, now Cape Kennedy.³ On August 24, 1961, the Justice Department, acting upon a request by NASA Administrator James Webb, filed in the district court a complaint in condemnation describing a 72,644-acre tract of land needed for the project.⁴ The condemned tract did not include the Colton property. A map attached to the complaint showed the northern boundary of the condemned tract to be just south of Haulover Canal. The appellant's land lay north of the canal and five and one-half miles beyond the northern boundary of the condemned tract. See Appendix A for a sketch of the area.

On December 24, 1963, over two years after the filing of this original complaint, the Justice Department, again acting pursuant to a request from NASA officials, filed a second complaint which called for the condemnation of an additional 14,800 acres, adjoining at the north the 72,644 acres already condemned. The Colton land was included in the new condemnation.

The fifth amendment to the Constitution provides that private property shall not be taken for public use without payment of just compensation to the owner. Market value is the judicial standard employed to measure just compensation, but in determining market value, courts must exclude any increment of value arising by virtue of the fact that the Government proposes to take the land for a public project.⁵ In anticipation of a proposed project, real property adjacent to or near the land to be taken frequently increases in value; however, the land which is expected to be taken does not legitimately share in this enhancement because its inclusion in the project will make it unavailable for private development. Any enhancement in the value of the land necessarily would result from speculation that the Government might be compelled to pay an artificially inflated price.⁶

Principles applicable to the case before us were enunciated by the Supreme Court in United States v. Miller:

If a distinct tract is condemned, in whole or in part, other lands in the neighborhood may increase in market value due to the proximity of the public improvement erected on the land taken. Should the Government, at a later date, determine to take these other lands, it must pay their market value as enhanced by this factor of proximity. If, however, the public project from the beginning included the taking of certain tracts but only one of them is taken in the first instance, the owner of the other tracts should not be allowed an increased value for his lands which are ultimately to be taken * * *.

The question then is whether the respondents\' lands were probably within the scope of the project from the time the Government was committed to it. If they were not, but were merely adjacent lands, the subsequent enlargement of the project to include them ought not to deprive the respondents of the value added in the meantime by the proximity of the improvement. If, on the other hand, they were, the Government ought not to pay any increase in value arising from the known fact that the lands probably would be condemned. (Emphasis added.)⁷

It is important to note the Court's use of the word known in the last sentence quoted above. Even though the probability of a given tract's being added to a project is known within the confidential circles of Government planning, if the probability is not publicly disclosed, the tract may realize a legitimate increase in value since a developer contemplating acquisition of the land can make an offer without serious apprehension that the land will be condemned.⁸

The district court conducted a pretrial hearing on the enhancement issue and received extensive evidence concerning the original scope of the lunar landing project at Cape Canaveral. The court viewed the evidence as establishing that the Colton land was within the scope of the project on August 24, 1961, when the original condemnation complaint was filed and that the filing of the complaint was public notice that the Colton land probably would be needed as a part of the "over-all project." Consequently, the court ruled that enhancement in value occurring subsequent to August 24, 1961 should not be considered in determining the market value of the appellant's land. Our review of the evidence received at the pre-trial hearing convinces us that the complaint filed on August 24, 1961 did not disclose a probability that the Colton land would be needed for the project and that the district court's contrary finding is clearly erroneous.

It is undisputed that the 72,644 acres described in the complaint filed August 24, 1961 did not include the Colton land.⁹ Moreover, public testimony given by NASA's Deputy Director, Dr. Hugh Dryden, on September 1, 1961 before the Senate Committee on Aeronautical and Space Sciences clearly indicated that additional acquisitions which might include the Colton land were not anticipated.¹⁰ Dr. Dryden, discussing the factors which led to the selection of Cape Canaveral as the launch site, noted that, unlike some other sites considered, there was no problem at Cape Canaveral with inland waterways. He explained that the Intracoastal Waterway near the Cape was a sufficient distance from the site selected to prevent launch operations from interfering with commercial use of the waterway. The implication of Dr. Dryden's remarks was unmistakable: NASA had no plan for taking any lands which would interfere with use of the waterway. Acquisition of land lying north of Haulover Canal, as did the Colton land, would necessarily create an interference. In June 1962, when NASA decided to acquire the 14,800 acres north of the canal, its officials reappeared before the Senate committee seeking not only funds to acquire the additional acreage, but also funds to relocate the waterway. NASA Director Webb told the committee:

The relocation of the inland waterway and bridge is necessary because a segment of the intercoastal waterway and the bridge crossing it are within the acreage to be acquired. It is not considered practicable for safety and other reasons to permit the public to traverse the launching area.¹¹

During Deputy Director Dryden's appearance before the Senate committee in September 1961, he exhibited a map of the lands which NASA was seeking appropriations to acquire. The map outlined the 72,644-acre tract which was described in the complaint filed August 24, 1961. Dr. Dryden informed the committee that the appropriation sought would cover all the land acquisition anticipated. This public disclosure by Dr. Dryden is forceful evidence that, as NASA viewed its program on the date of the original condemnation, the appellant's land probably would not be taken. When the committee was approached again in June 1962 for an appropriation to acquire the additional 14,800 acres, Administrator Webb acknowledged that this acreage was not a part of the acquisition for which funds had been sought in September 1961. He stated:

The immediate need for this land results form the introduction into the presently planned total launch complex facilities the TITAN III program of the Department of Defense. The availability of this additional land will permit more advantageous design and location of the launch facilities for the advanced SATURN and NOVA programs previously planned to be accommodated within * * * the 72,644-acre tract.¹²

We have searched the record in vain for any Governmental action which would give notice to a prospective real estate purchaser on August 24, 1961 that the Colton land probably would be condemned.¹³ The fragmentary evidence found...