United States v. Sutro

• Decision Date: 07 May 1956
• Docket Number: No. 14588.,14588.
• Citation: 235 F.2d 499
• Parties: UNITED STATES of America, Appellant, v. Adolph G. SUTRO, Appellee. Adolph G. SUTRO, Cross-Appellant, v. UNITED STATES of America, Cross-Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

235 F.2d 499 (1956)

UNITED STATES of America, Appellant, v. Adolph G. SUTRO, Appellee.

Adolph G. SUTRO, Cross-Appellant, v. UNITED STATES of America, Cross-Appellee.

No. 14588.

United States Court of Appeals Ninth Circuit.

May 7, 1956.

Laughlin E. Waters, U. S. Atty., Max F. Deutz, Marvin Zinman, Asst. U. S. Attys., Los Angeles, Cal., for appellant.

Gray, Cary, Ames & Frye, John M. Cranston, Thomas C. Ackerman, Jr., San Diego, Cal., for appellee.

Before STEPHENS, POPE and FEE, Circuit Judges.

JAMES ALGER FEE, Circuit Judge.

In 1946, Sutro bought certain farm lands riparian to Pilgrim Creek. Before that time, the government had constructed a sewage disposal plant for Camp Pendleton, the effluents of which were deposited in the stream until 1952. Pilgrim Creek became so polluted that it was not fit for the irrigation of lands used for growing of vegetables intended for human consumption.

The cause was tried by a court without a jury under the Tort Claims Act, 28 U.S.C.A. §§ 1346(b), 2671-2680. It was found that the employees of the government were negligent in operating the sewage disposal plant, as a result of which the waters of the stream became polluted. The District Court found $18,918.36 represented loss of rental value to Sutro, while $13,003.03 was awarded as damages for increased building costs.

Appeal was filed by the government on the ground that there should have been no award for the increased costs of building contemplated facilities. Sutro cross-appeals (1) because damages were not allowed for increased cost of erecting a residence and guest house, including sewerage, fencing, grading and incidentals, and for the increased expense of the irrigation system, machinery and equipment for the repair shop, farm machinery and equipment, (2) because the rental value allowed was too small, and (3) because he was not allowed expenditures for the purpose of minimizing damages.

As far as the appeal of the government is concerned, no question of law is involved. The United States conceded injury to plaintiff had been caused by the negligence of its agents in the operating of the sewage plant. In an action under the Federal Tort Claims Act for a tort committed in California, the legislative and decisional law of the state applicable between private parties controls. The measure of damages as a matter of law is governed thereby.

"The amount which will compensate for all the detriment proximately caused thereby, whether it could have been anticipated or not"¹ has been confirmed by the California state courts as the touchstone of allowable damages.²

In accordance with the common law, this section is not construed to permit the recovery of remote or speculative damages.³ It has been recognized, however, that the statute lays down no fixed inflexible rule whereby the measure of damages for injury to property can be reduced to a mathematical certainty.⁴ The selection of a formula most appropriate to compensate the injured party is largely within the sound discretion of the trier of fact. If the rules of law had been correctly laid down, a general verdict for this sum of damages would have been upheld unsegregated.

The trial court apparently was following the rules laid down by the California courts. The formula used by the trial court required that the damages should have been proximately caused by the negligence of the government agents and that such as were remote and speculative should be excluded. Concretely, the award was based upon injuries which were the natural and direct consequence of the negligence and which flowed naturally therefrom by reason of a causal connection between the negligence and the injury.

The trial court found that the loss of rental for the property during the six years while these conditions were continuously maintained was one of the consequences. The government concedes this is correct. The trial court also found that the loss to plaintiff in increased costs of improvements which plaintiff had contemplated erecting for the use of the place as an agricultural property was compensable. The argument is that plaintiff was not prohibited from building the improvements if he had so chosen. But this argument comes with poor grace from the tort-feasor who maintained these harmful conditions for this long period of time. Each day of this time there was a new offense and a new and continuing injury. Plaintiff would have been unwise to have commenced further construction. He could not speculate upon the cessation of tortious conduct by the government.

Since the law of California is binding as to measure of damages, as well as other features under the Tort Claims Act, full consideration must be given to the opinion of the California Supreme Court, entitled Barnes v. Berendes, 139 Cal. 32, 69 P. 491, 72 P. 406. There plaintiff had started construction of a building upon a lot which he had purchased adjoining one on which defendant already had a house. The proposed building was designed as a manufacturing plant. After a start had been made, it was discovered that, although the foundations were within her lot, the house of defendant overhung plaintiff's lot by three inches. Damages were allowed in the lower court for loss of estimated profits of the manufacturer and for an increase in the price of necessary lumber for construction during the period of delay. The Supreme Court held that damages could not be allowed for profits lost by the business, since plaintiff had in fact operated in a temporary location and the expenses of setting up this operation had been charged by the trial court to defendant.

On the other hand, it was held to be "proper to allow the plaintiff, as damages, the difference between the price of lumber at the time he negotiated for it, immediately before he discovered that the building could not be continued, owing to the obstructions from the defendant's house, and the value at a time subsequent thereto. As the defendant was responsible for the delay, she must be held responsible for all the damages proximately arising therefrom. Although the plaintiff bargained for the lumber before the erection of the building was suspended, yet it appears that the lumber dealers refused to hold the contract open, and that in the meantime lumber rose in price, so that the...