United States v. Powelson

• Decision Date: 08 October 1943
• Docket Number: No. 4679.,4679.
• Parties: UNITED STATES ex rel. TENNESSEE VALLEY AUTHORITY v. POWELSON et al.
• Court: U.S. Court of Appeals — Fourth Circuit

138 F.2d 343 (1943)

UNITED STATES ex rel. TENNESSEE VALLEY AUTHORITY v. POWELSON et al.

No. 4679.

Circuit Court of Appeals, Fourth Circuit.

October 8, 1943.

William C. Fitts, Jr., Gen. Counsel, Tennessee Valley Authority, of Knoxville, Tenn. (Charles J. McCarthy, Asst. Gen., Counsel, Tennessee Valley Authority, and Robert H. Marquis, both of Knoxville, Tenn., on the brief), for appellant and cross-appellee.

G. Lyle Jones and George H. Wright, both of Asheville, N. C., for appellee and cross-appellant.

Before PARKER, SOPER, and DOBIE, Circuit Judges.

PARKER, Circuit Judge.

The decision of this Court, rendered on March 10, 1941, was to the effect that the award of damages by the District Court for property condemned by the United States should be modified by eliminating certain items from the award of damages and that, as so modified, the judgment appealed from should be affirmed. United States v. Powelson, 4 Cir., 118 F.2d 79. This decision was reversed by the Supreme Court because that Court was of the view that in arriving at the award of damages certain elements had been included in the valuation of the property which should not have been considered. United States v. Powelson, U.S., 63 S.Ct. 1047, 1057, 87 L.Ed. 1390. We have given careful consideration to what should be the future procedure in the case, and are of opinion that it should be remanded to the District Court for further proceedings in accordance with the principles laid down by the Supreme Court, and with leave to the parties to produce additional testimony, if they so desire.

In reversing the decision of this Court, the Supreme Court held that the respondent's privilege to use the power of eminent domain might not be considered in determining whether there was a reasonable probability of the lands in question being combined with other tracts into a power project in the reasonably near future, and that respondent had not established the basis for proof of the "water power value" which was asserted, except upon the assumption that it possessed the power of eminent domain. The limited nature of the decision was shown by the opening sentence of the next to the last paragraph of the opinion wherein the Court said: "We hold only that profits, attributable to the enterprise which respondent hoped to launch, are inadmissible as evidence of the value of the lands which were taken."

The Court went on to say: "Respondent is, of course, entitled to the market value of the property fairly determined. And that value should be found in accordance with the established rules (United States v. Miller, supra 317 U.S. 369, 63 S.Ct. 276, 87 L.Ed. ___) — uninfluenced, so far as practicable, by the circumstance that he whose lands are condemned has the power of eminent domain."

The Miller case 317 U.S. 369, 63 S.Ct. 280, 87 L.Ed. ___ cited in the excerpt from the opinion goes fully into the principles to be applied in determining valuation and states that "the market value of the property is to be fixed with due consideration of all its available uses", citing Boom Co. v. Patterson, 98 U.S. 403, 407, 408, 25 L.Ed. 206. The rule is thus stated in the case last cited:

"In determining the value of land appropriated for public purposes, the same considerations are to be regarded as in a sale of property between private parties. The inquiry in such cases must be what is the property worth in the market, viewed not merely with reference to the uses to which it is at the time applied, but with reference to the uses to which it is plainly adapted; that is to say, what is it worth from its availability for valuable uses. Property is not to be deemed worthless because the owner allows it to go to waste, or to be regarded as valueless because he is unable to put it to any use. Others may be able to use it, and make it subserve the necessities or conveniences of life. Its capability of being made thus available gives it a market value which can be readily estimated.

"So many and varied are the circumstances to be taken into account in determining the value of property...