United States v. Baugh

• Citation: 149 F.2d 190
• Decision Date: 04 May 1945
• Docket Number: No. 10956.,10956.
• Parties: UNITED STATES v. BAUGH et al.
• Court: United States Courts of Appeals. United States Court of Appeals (5th Circuit)

149 F.2d 190 (1945)

UNITED STATES v. BAUGH et al.

No. 10956.

Circuit Court of Appeals, Fifth Circuit.

May 4, 1945.

Norman M. Littell, Asst. Atty. Gen., Vernon L. Wilkinson and S. Billingsley Hill, Attys., Department of Justice, both of Washington, D. C., and Clyde O. Eastus, U. S. Atty., and Frank B. Potter, Asst. U. S. Atty., both of Fort Worth, Tex., for appellant.

J. C. Darroch, of Brownwood, Tex., for appellees.

Before HOLMES, McCORD, and WALLER, Circuit Judges.

WALLER, Circuit Judge.

The question to be answered in this appeal is stated by appellant as follows:

"Whether in a condemnation proceeding under the Second War Powers Act, where an agreement has been entered into with the landowners (after the United States acquired possession) fixing the amount of just compensation, the United States is liable for interest on that sum from the date of the agreement to the date when the money is made available to the landowners."

The condemnation proceedings were begun on August 24, 1942, under the Second War Powers Act, Sec. 632, 50 U.S. C.A.Appendix, to acquire approximately 120,000 acres of land for military purposes in connection with Camp Bowie and an order for immediate possession was entered on the same day. Several months thereafter the owners of numerous parcels within the area entered into stipulations with the United States wherein the parties agreed upon certain sums as just compensation to be awarded for the taking of their property and waived service of notice of all kinds, including that of a hearing before special commissioners appointed by the Court to make findings as to the amount of just compensation. The stipulations agreed that the Court "is hereby authorized and petitioned to enter without further notice a final judgment and decree in said action in accordance with the prayer in plaintiff's petition herein, or any declaration of taking which may hereafter be filed by the plaintiff, vesting the title to the above-described property in the United States of America, and adjudging just compensation for the lands taken, to be in the sum of * * *."

The agreement contained the further stipulation:

"The foregoing stipulation is made to expedite the vesting of title in the plaintiff, the United States of America, and the payment of just compensation for such lands to the owners thereof, and it is the purpose and intent hereof to vest in the Court, without any further proceeding and notice, full authority to close such action by final judgment and to disburse the funds in accordance therewith."

Based on three of the stipulations three final decrees in condemnation were entered and three separate orders were made allowing interest to the landowners, the tracts of land embraced in said orders and judgments being designated as Tract A-122, Tract G-714, and Tract G-746.

The alleged stipulation as to Tract A-122 is not in the record and, of course, we cannot review or construe that stipulation nor the order of the lower Court based thereon. That order must necessarily be affirmed.

The stipulation as to Tract G-714 was dated January 2, 1943, but the Government did not deposit the amount to be paid under the stipulation until August 25, 1943, or nearly eight months later. The stipulation as to Tract G-746 was dated February 22, 1943, but the Government did not make a deposit into the registry of the Court for the landowner until August 25, 1943, or seven months later. The Government had taken possession of each tract of land slightly more than a year before any compensation was made available to the landowner. The Court below allowed interest from the date of the stipulations between the landowners and the Government to the date the money provided for in the stipulations was deposited in Court, and denied the landowners' claim of the right to be paid interest at the legal rate in Texas on the agreed sum from the date that possession of their lands was taken by the United States to date of deposit of such sum into the registry of the Court. No appeal, or cross appeal, was taken from the order of the lower Court in disallowing interest from the date of taking possession to the dates of the stipulations.

The only specification of error is that the allowance by the District Court of interest on the sums agreed upon by the parties as just compensation violates the terms of the agreements and the rule that interest does not run on contractual claims against the sovereign.

Counsel for the Government recognize that the phrase "just compensation" springs from the Fifth Amendment and that when it is used in connection with condemnation proceedings it embraces not only the value of the property at the date of taking but whenever the taking precedes payment, the term also includes "such addition as will produce the full equivalent of that value paid contemporaneously with the taking," as was held in Seaboard Air Line R. v. United States, 261 U.S. 299, 43 S.Ct. 354, 67 L.Ed. 664; Jacobs v. United States, 290 U.S. 13, 54 S.Ct. 26, 28, 78 L.Ed. 142, 96 A.L.R. 1; and Phelps v. United States, 274 U.S. 341, 47 S.Ct. 611, 71 L.Ed. 1083.¹

In the present case the Government did not take a deed from the landowner as in an outright purchase, but it acquired title and possession by condemnation. The stipulation merely had the effect of relieving the Government from having to make proof as to what was just compensation and of running the risk of having an amount fixed which might be unsatisfactory. The stipulations eliminated controversies, but otherwise the condemnation suit proceeded to final judgment. There is no mention in the stipulations that interest was, or was not, included. Just compensation in condemnation cases means just compensation at the time of taking of possession, and when the parties reduced to writing a stipulation fixing just compensation there seems to be no reason to conclude that the landowner impliedly waived any legal right. In view of the...