United States v. Dow

• Decision Date: 09 June 1958
• Docket Number: No. 102,102
• Citation: 2 L.Ed.2d 1109,78 S.Ct. 1039,357 U.S. 17
• Parties: UNITED STATES of America, Petitioner, v. C. M. DOW
• Court: U.S. Supreme Court

357 U.S. 17

78 S.Ct. 1039

2 L.Ed.2d 1109

UNITED STATES of America, Petitioner,

v C. M. DOW.

No. 102.

Argued March 5, 1958.

Decided June 9, 1958.

Mr. Perry W. Morton, Washington, D.C., for petitioner.

Mr. L. Keith Simmer, Houston, Tex., for respondent.

Mr. Justice HARLAN delivered the opinion of the Court.

The issue in this case arises out of a condemnation proceeding in which the United States acquired an easement pursuant to its power of eminent domain. The principal question presented is whether the claim to 'just compensation' vested in the owners of the land at the time the United States entered into possession of the easement pursuant to court order in 1943 or whether such claim vested in the respondent, Dow, who acquired the land in 1945, at the time the United States filed a declaration of taking in 1946, under the Declaration of Taking Act of February 26, 1931, 46 Stat. 1421, 40 U.S.C. §§ 258a—258e, 40 U.S.C.A. §§ 258a—258e.

In March 1943 the United States instituted a condemnation proceeding in the District Court for the Southern District of Texas to acquire a right-of-way for a pipe line over certain lands in Harris County, Texas, owned by the estate and heirs of John F. Garrett and James Bute. Among the lands condemned was Parcel 1, a narrow strip of some 2.7 acres out of a 617-acre tract, the property involved in the present suit. The Government proceeded under various statutes, including the Act of August 1, 1888, 25 Stat. 357, 40 U.S.C. § 257, 40 U.S.C.A. § 257, and Title II of the Second War Powers Act of March 27, 1942, 56 Stat. 176, 177. As requested in the petition, the District Court ordered the United States into the 'immediate possession' of this strip. Within the next ten days the United States entered into physical possession and began laying the pipe line through the tract. The line was completed in 1943 and has been in continuous use since that time.

In November 1945 the 617-acre tract was conveyed to Dow by a general warranty deed which specifically excepted the pipe-line right-of-way as being subject to the condemnation proceedings. In May 1946 the Government filed a declaration of taking, under the Declaration of Taking Act, covering this pipe-line strip. Estimated compensation was deposited in court any judgment on the declaration of taking was entered. A few months later the Government amended its petition to name additional parties, including Dow, who were alleged to be asserting an interest in the land. The question of compensation was referred to commissioners under the Texas practice, which at that time was applicable to federal condemnation proceedings. See United States v. Miller, 317 U.S. 369, 379—380, 63 S.Ct. 276, 282—283, 87 L.Ed. 336. After a hearing, at which Dow appeared, the commissioners, in 1948, awarded $4,450 for imposition of the pipe-line easement.

After a lengthy unexplained delay in the proceedings, the Government in May 1955 filed a motion for summary judgment against Dow. In March 1956 the District Court granted this motion and dismissed Dow as a party. The District Court found as a fact that Dow's grantors had intended to convey to him 'all their right, title and interest in the said Parcel No. 1 or in the award to be made for the same.' It then went on to rule that under the Assignment of Claims Act, 31 U.S.C. § 203, 31 U.S.C.A. § 203, this was a prohibited assignment of a claim against the United States, and that the deed was therefore ineffective to convey to Dow the compensation award. The Court of Appeals reversed, holding that no assignment was involved because no claim to compensation against the United States 'arose and vested' until the filing of the declaration of taking in 1946, and that, because Dow by that time had become owner of the land, he was entitled to the award. 238 F.2d 898. Because the question presented bears importantly on rights resulting from federal condemnation proceedings, we granted the Government's petition for certiorari. 353 U.S. 972, 77 S.Ct. 1057, 1 L.Ed.2d 1135.

It is well established, as the Court of Appeals recognized, that the Assignment of Claims Act prohibits the voluntary assignment of a compensation claim against the Government for the taking of property. United States v. Shannon, 342 U.S. 288, 72 S.Ct. 281, 96 L.Ed. 321. In view of the express finding of the District Court that Dow's grantors intended to convey to him their right to the condemnation award, we think that the transfer of the claim in this case must be considered to have been such a voluntary assignment, rather than, as Dow argues, an assignment taking effect by operation of law, and thus not within the Act's prohibition. Cf. United States v. Aetna Casualty & Surety Co., 338 U.S. 366, 373—376, 70 S.Ct. 207, 211—213, 94 L.Ed. 171; see 23 Tracts of Land v. United States, 6 Cir., 177 F.2d 967, 970. We would not be justified in relaxing the rigor of the Act, especially in view of the fact that under its very terms the way was left open for the parties to accomplish a transfer of the award by valid means.^* Accordingly, Dow can prevail only if the 'taking' occurred while he was the owner. For it is undisputed that '(since) compensation is due at the time of taking, the owner at that time, not the owner at an earlier or later date, receives the payment.' Danforth v. United States, 308 U.S. 271, 284, 60 S.Ct. 231, 236, 84 L.Ed. 240; cf. United States v. Dickinson, 331 U.S. 745, 67 S.Ct. 1382, 91 L.Ed. 1789. We hold, contrary to the Court of Appeals, that the 'taking' did not occur in 1946 when the Government filed its declaration of taking, but rather when the United States entered into possession of the land in 1943. It follows that the landowners in 1943 were entitled to receive the compensation award and that Dow is not entitled to recover in this action.

Broadly speaking, the United States may take property pursuant to its power of eminent domain in one of two ways: it can enter into physical possession of property without authority of a court order; or it can institute condemnation proceedings under various Acts of Congress providing authority for such takings. Under the first method—physical seizure—no condemnation proceedings are instituted, and the property owner is provided a remedy under the Tucker Act, 28 U.S.C. §§ 1346(a)(2) and 1491, 28 U.S.C.A. §§ 1346(a)(2), 1491, to recover just compensation. See Hurley v. Kincaid, 285 U.S. 95, 104, 52 S.Ct. 267, 269, 76 L.Ed. 637. Under the second procedure the Government may either employ statutes which require it to pay over the judicially determined compensation before it can enter upon the land, Act of August 1, 1888, 25 Stat. 357, 40 U.S.C. § 257, 40 U.S.C.A. § 257; Act of August 18, 1890, 26 Stat. 316, 50 U.S.C. § 171, 50 U.S.C.A. § 171,¹ or proceed under other statutes which enable it to take immediate possession upon order of court before the amount of just compensation has been ascertained. Act of July 18, 1918, 40 Stat. 904, 911, 33 U.S.C. § 594, 33 U.S.C.A. § 594; Title II of the Second War Powers Act of March 27, 1942, 56 Stat. 176, 177 (employed by the Government in the present case).

Although in both classes of 'taking' cases—condemnation any physical seizure—title to the property passes to the Government only when the owner receives compensation, see Albert Hanson Lumber Co. v. United States, 261 U.S. 581, 587, 43 S.Ct. 442, 444, 67 L.Ed. 809, or when the compensation is deposited into court pursuant to the Taking Act, see 78 S.Ct. 1045, infra, the passage of title does not necessarily determine the date of 'taking.' The usual rule is that if the United States has entered into possession of the property prior to the acquisition of title, it is the former event which constitutes the act of taking. It is that event which gives rise to the claim for compensation and fixes the date as of which the land is to be valued and the Government's obligation to pay interest accrues. See United States v. Lynah, 188 U.S. 445, 470—471, 23 S.Ct. 349, 357, 47 L.Ed. 539; United States v. Rogers, 255 U.S. 163, 41 S.Ct. 281, 65 L.Ed. 566; Seaboard Air Line R. Co. v. United States, 261 U.S. 299, 43 S.Ct. 354, 67 L.Ed. 664. The owner at the time the Government takes possession 'rather than the owner at an earlier or later date, is the one who has the claim and is to receive payment.' 23 Tracts of Land v. United States, supra, 177 F.2d at page 970.

Had the Government not subsequently filed a declaration of taking in this case, there is no reason to believe that these ordinary rules would not have been applicable; the owners of the parcel when the Government entered into possession in 1943 would then have been entitled to compensation. No suggestion to the contrary has been made by Dow. Instead, Dow contends that although there was an entry into possession in 1943 which was an appropriation of the property sufficient to amount to a 'taking,' the subsequent filing of a declaration of taking vitiated the effect of the earlier entry, and rendered the filing date the time of the taking. We think that this contention is founded on a mistaken view of the Declaration of Taking Act and must be rejected.

Section 1 of the Declaration of Taking Act provides: 'Upon the filing said declaration of taking (prior to judgment in a condemnation proceeding) and of the deposit in the court * * * of the estimated compensation * * * title * * * shall vest in the United States * * * and said lands shall be deemed to be condemned and taken for the use of the United States, and the right to just compensation * * * shall vest in the persons entitled thereto * * *.' Although it has been recognized that the 'exact effect of these provisions is not entirely clear,' Catlin v. United States, 324 U.S. 229, 240, 65 S.Ct. 631, 637, 89 L.Ed. 911, past cases in this Court have established certain unchallenged principles pertinent to the present controversy. The Taking Act does not bestow independent authority to condemn lands for...