United States v. Twin City Power Company, 7427-7429.

• Decision Date: 15 July 1957
• Docket Number: No. 7427-7429.,7427-7429.
• Citation: 248 F.2d 108
• Parties: UNITED STATES of America, Appellant and Cross-Appellee, v. TWIN CITY POWER COMPANY, Appellee and Cross-Appellant. (Tract No. C-215). UNITED STATES of America, Appellant and Cross-Appellee, v. TWIN CITY POWER COMPANY, Appellee and Cross-Appellant. (Tracts Nos. F-500 and H-700). UNITED STATES of America, Appellant and Cross-Appellee, v. TWIN CITY POWER COMPANY, Appellee and Cross-Appellant. (Tracts Nos. F-541 (part) and H-732).
• Court: U.S. Court of Appeals — Fourth Circuit

248 F.2d 108 (1957)

UNITED STATES of America, Appellant and Cross-Appellee, v. TWIN CITY POWER COMPANY, Appellee and Cross-Appellant. (Tract No. C-215).

UNITED STATES of America, Appellant and Cross-Appellee, v. TWIN CITY POWER COMPANY, Appellee and Cross-Appellant. (Tracts Nos. F-500 and H-700).

UNITED STATES of America, Appellant and Cross-Appellee, v. TWIN CITY POWER COMPANY, Appellee and Cross-Appellant. (Tracts Nos. F-541 (part) and H-732).

Nos. 7427-7429.

United States Court of Appeals Fourth Circuit.

Argued June 13, 1957.

Decided July 15, 1957.

Rehearing Denied September 18, 1957.

Harold S. Harrison, Atty., Dept. of Justice, Washington, D. C. (Perry W. Morton, Asst. Atty. Gen., Joseph E. Hines, U. S. Atty., Spartanburg, S. C., Robert A. Clay, Asst. U. S. Atty., Greenville, S. C., Roger P. Marquis and Fred W. Smith, Attys., Dept. of Justice, Washington, D. C., on the brief), for appellant and cross-appellee.

David W. Robinson, Columbia, S. C., for appellee and cross-appellant.

Before PARKER, Chief Judge, and SOPER and HAYNSWORTH, Circuit Judges.

PARKER, Chief Judge.

This is the second time that we have had before us these three condemnation cases involving compensation for the taking of lands on the Savannah River. Commissioners appointed by the court below to value the lands filed a report showing that, when considered in connection with their availability for water power purposes, they had a value of $267.02 per acre, or a total value of $471,904.45, but that, as agricultural or wild forest lands, they had a value of approximately $37 per acre, or a total value of $60,293 for the 1,610.8 acres owned by the defendant in fee simple. The District Judge, without passing upon the valuation for agricultural and forestry purposes, approved the valuation based upon their availability for water power purposes (D.C., 114 F.Supp. 719), and this court affirmed. United States v. Twin City Power Co., 4 Cir., 215 F.2d 592. The Supreme Court granted certiorari and reversed, holding that the availability of the lands for water power purposes might not be considered in valuing them for the purpose of determining just compensation on condemnation by the government. 350 U.S. 222, 76 S.Ct. 259, 100 L.Ed. 240.

On remand, the District Judge, sitting with the District Judge for the Southern District of Georgia, who had jurisdiction with respect to the lands on the Georgia side of the river, reviewed the evidence and the findings of the commissioners as to the value of the lands for agricultural and forestry purposes. He held the findings with respect to these values to be clearly erroneous and found the correct value of the lands, without considering their availability for power development, to be around $80 per acre, or a total of $131,388, for which he entered judgment. He held that no recovery could be had for flowage easements owned by defendant power company over 156.56 acres of land to which it did not hold fee simple title. The government has appealed from the judgment fixing the value of the lands, contending that the amount thereof is excessive and that the judge transcended his powers in overruling the findings of the commissioners. The power company has appealed from the holding that it was not entitled to any compensation for the taking of the flowage easements which it held.

We think that the District Judge was justified in holding the report of the commissioners as to the valuation of the land for agricultural and forestry purposes to be clearly erroneous and substituting a valuation at which he had arrived after a careful study of the testimony; and weight is added to his action by reason of the fact that the District Judge from Georgia, sitting with him and reviewing the same record, took similar action. The commissioners had made their valuation at a time when it was thought that the highest value of the land was that arising from its availability for water power purposes; and, as this value was far above its value for agricultural and forestry purposes, they gave little attention to the latter, contenting themselves with a brief statement with regard thereto at the end of a lengthy report dealing principally with value for water power purposes. In reporting on value for agricultural and forestry purposes, they adopted the valuation placed upon the land by a witness Cox, a furniture dealer, cattle raiser and sawmill operator, who was not shown to have had any special qualifications for valuing lands in that community, and ignored the testimony of two experienced land bank appraisers who were eminently qualified to appraise them. With respect to the testimony of these appraisers, the trial judge said:

"Twin City offered two experienced land appraisers. One, W. N. Henderson of Ninety-Six, in Greenwood County, South Carolina, is a Clemson College graduate with 14 years of experience as a Federal Land Bank appraiser and 4 years with FHA. The other, Benjamin R. T. Todd, was educated at Clemson and at the Naval Academy. He had long years of experience as Senior Appraiser with the Federal Land Bank in Columbia. Each has appraised many tracts of land in the area of the Clark Hill reservoir. Both of these witnesses, as well as the witnesses for the United States, have testified before me in other condemnation cases.

"Mr. Henderson, after detailed study of the several tracts being considered, determined that the principal agricultural uses of these lands were for pasturage to feed cattle, which at the time of taking was an important and growing use of lands in this area, and for the growing of pine. Some 300 acres of bottom land were also useful for row crops. All of the witnesses for both sides agreed that raising cattle and pine had become the chief use of lands in this area, though row crops were still planted in the bottoms.

"Mr. Henderson concluded that, aside from the value of timber and pulp wood on these tracts, the 300 acres of bottom land was worth $100 per acre and the other 1300 acres had a value of $85 per acre. In reaching these conclusions, Mr. Henderson took into consideration the amount it would take to put land into pasturage condition, the yield from tree farming, the price of timber and pulp wood, the demand for such lands. He valued the timber on the properties at $17,000 and the strip of land used for a railroad (5.80 acres) at $1500. His total valuation for Twin City\'s South Carolina properties was $159,425.

"Mr. Todd\'s valuation at $100 per acre aggregated $161,080."

The trial judge pointed out that the chief land witness relied upon by the government had never previously sold or appraised land in this community and that, although he made his valuation on the basis of a comparison of sales, he used only seven sales as a basis of comparison, although he had a list of 400 transfers of rural lands in the county, that five of the seven occurred a year or more before the taking and that he admitted that to buy land in the county at the time of the taking one would have had to pay a much higher price than his appraisal. As to the witness Cox, whose valuation was adopted by the commissioners and another witness relied on by the government, the judge said:

"The Commissioners in their finding followed the appraisal of James M. Cox who testified for the Government. Mr. Cox is a furniture dealer, a cattle raiser and a sawmill operator. He had no experience in handling real estate for others and little for himself. Instead of testifying as to market value he appraised so as to allow for `making a sawmill man\'s profit on it.\' The testimony does not show how much below market value this is. He was unwilling to state the land\'s worth for pasture though he stated that one of its best uses was for raising cattle. His is not the type of testimony on which an award should be based when there is in the record so much more reliable evidence.

"Another government witness, the Augusta broker Gould Barrett, had never inspected the Twin City lands, had not sold any lands in McCormick County in the five years before his testimony in his case, and was unfamiliar with timber prices. These witnesses for the United States placed a per acre value on the Twin City lands of between $15 and $25 per acre. The Commissioners, adopting the testimony of James M. Cox on land and Clark Honnold on timber, added a value of $5 per acre for assembling and arrived at a total value of about $60,000 as compared with the Henderson and Todd appraisals of about $160,000.

"The findings of the Commissioners as to the agricultural value of these South Carolina lands based on the Cox appraisal are clearly erroneous as that term is defined hereinabove."

The government argues that because there was substantial testimony supporting the findings of the commissioners and because they saw and heard the witnesses, the trial judge was bound to accept their findings. If this were the law, the right of review vested in the trial judge by Rule 53, Fed.Rules Civ. Proc., 28 U.S.C.A., would amount to little, for almost always the master or commissioners see and hear the witnesses and seldom do they render a report which can be said to be without substantial support in the evidence. It was the purpose of the rule, where there is a trial without a jury, to place ultimate responsibility for the findings of fact upon the judge. Where there has been a reference to a master, the master's findings are entitled to special weight because he has seen and heard the witnesses but they are not given the effect of a verdict by a jury. The language of the rule is that the court shall accept the master's findings unless clearly erroneous. This is manifestly a guide to be followed in the exercise of the discretion vested in the District Judge, not a limitation upon his power. The rule applicable is well stated by Judge Bratton, speaking for the Court of Appeals of the Tenth Circuit in United States v. Waymire, 10 Cir., 202 F.2d 550, 553, as follows:

"Under the

...