Walker v. Acting Director, Dept. of Forests and Parks

• Decision Date: 19 January 1979
• Docket Number: No. 35,35
• Citation: 396 A.2d 262,284 Md. 357
• Parties: Thomas J. WALKER, Jr. et al., Trustees v. ACTING DIRECTOR, DEPARTMENT OF FORESTS AND PARKS, etc.
• Court: Maryland Court of Appeals

Page 357

284 Md. 357

396 A.2d 262

Thomas J. WALKER, Jr. et al., Trustees v. ACTING DIRECTOR, DEPARTMENT OF FORESTS AND PARKS, etc.

No. 35.

Court of Appeals of Maryland.

Jan. 19, 1979.

Michael P. Crocker, Baltimore (Piper & Marbury, Baltimore, on the brief), for appellants.

Carl H. Lehmann, Jr., Spec. Atty., Upper Marlboro (Francis B. Burch, Atty. Gen. and Nolan H. Rogers, Asst. Atty. Gen., Baltimore, on the brief), for appellee.

Before MURPHY, C. J., and SMITH, DIGGES, ELDRIDGE, ORTH and COLE, JJ.

SMITH, Judge.

At issue in this appeal is the rate of interest which should be paid in a condemnation case when the State failed to satisfy a judgment prior to entering into possession of the land in question. We shall hold that the landowner was entitled to interest at the rate of 6% On the jury's verdict from the date of the judgment nisi until the award was paid into court.

Appellants, Thomas J. Walker, Jr., et al., Trustees (Walker), possessed land in Baltimore County which the State desired to acquire "for the purposes of establishing, expanding and completing the State Park known as Gunpowder State Park and other public purposes . . . ." An earlier round in this bout was before the Court in Acting Dir., Dep't of F. & P. v. Walker, 271 Md. 711, 319 A.2d 806 (1974) (Walker I ). A condemnation action was brought by the State acting through the Department of Forests and Parks. The State did not act nor could it have acted under any of the so-called "quick take" statutes authorized by Maryland Constitution Art. III, §§ 40A-40D. Thus, under Maryland Code (1957, 1973 Repl.Vol.) Art. 21, § 12-103 (then applicable), title to the land is to be deemed taken "upon payment of the judgment and costs by the plaintiff pursuant to Subtitle U of the Maryland Rules." As our earlier case recounts, the State, without any statutory authority for its action and without tendering payment of any kind, secured an ex parte order granting it possession of the land in question prior to the return of the inquisition by the jury.

We recorded in Walker I that a motion to strike the order granting the State the right of entry was made by Walker "but not pressed when the jury brought in what (Walker) regarded as 'a fair compromise verdict.' " We further noted:

The exact date does not clearly appear, but the parties are in agreement that at a time Subsequent to the return of the jury's verdict the State moved in on this land. (Id. at 713-14, 319 A.2d at 808 (emphasis added).)

Notwithstanding the fact that it had paid Walker no compensation, although it was in full possession of the land, the State appealed, apparently feeling aggrieved at the amount of the jury's award ($1,224,000). We held such action could not be permitted. We said in dismissing the appeal:

We prefer to believe that when the State's agents entered upon the property of the appellees, felled the trees, graded the land and began construction, it was the intent of those agents of the State vested with responsibility relative to this project to do that which was legal, rather than that which was illegal, and therefore, it was intended to waive the right of appeal. (Id. at 720, 319 A.2d at 811.)

Our comments and our dismissal of the appeal apparently failed to impress upon the officials of the State responsible for the condemnation action that the State was not permitted to treat its citizens as Walker was treated. We say that because even then the State did not pay the sum which the jury awarded. Judgment absolute on the inquisition was entered on December 20, 1973. We decided the case on May 31, 1974. Our mandate was received and filed by the Circuit Court for Baltimore County on July 5, 1974. It was not until July 25, 1974, three weeks less one day after the filing of our mandate, that the State paid the amount of the jury's award into the hands of the clerk of the circuit court. Even then it made no effort to pay interest on the award, a situation that continues even today, almost five years later.

Walker filed a motion for summary judgment in the condemnation proceeding in the circuit court claiming what was styled as "detention money" or "damages for delay." Interest on the amount of the award was sought from November 9, 1973, the date of the passage of the ex parte order permitting immediate entry. Ultimately, Walker was awarded $94,819.81 based upon the rate of return the State was receiving by way of interest on monies which it had invested during the period in question. The matter reached the Court of Special Appeals in Acting Director v. Walker, 39 Md.App. 298, 385 A.2d 806 (1978). That court held Walker was entitled to no interest prior to the date of the jury's inquisition, but should be paid interest at the rate of 6% From that date to July 24, 1974, when the money was paid into court. It said the award for the period from July 24, 1974, to January 31, 1977, the date of the circuit court's order, "was also in error" since it "was based upon its erroneous assessment of the amount of damages for the loss of the use of money" for that period. Accordingly, the case was remanded to the Circuit Court for Baltimore County for entry of an order consistent with the opinion of the Court of Special Appeals. We granted Walker's petition for the writ of certiorari.

Walker presents here a multifaceted argument that interest should be paid at the rate of return the State was earning upon its investments from November 9, 1973, the date of passage of the order for entry, to the present time. In essence, Walker contends that interest is an integral part of the compensation to be paid for the taking of the property in question since the State entered into possession prior to payment, and that compensation for this deprivation of property should only be at the rate of return upon the State's own investments, which is substantially in excess of the legal interest of 6%.

There is a respectable body of law to the effect that when an owner's property is taken before he is paid compensation he is entitled to detention damages, often interest on the amount of the award. See, e. g., Phelps v. United States, 274 U.S. 341, 344, 47 S.Ct. 611, 71 L.Ed. 1083 (1927); Seaboard Air Line Ry. v. United States, 261 U.S. 299, 306, 43 S.Ct. 354, 67 L.Ed. 664 (1923); United States v. Certain Land in City of St. Louis, Mo.,41 F.Supp. 809, 812 (E.D.Mo.1941); Milstar Mfg. Corp. v. Waterville Urban R. Auth., 351 A.2d 538, 544 (Me.1976); Gitlin v. Pa. Turnpike Com., 384 Pa. 326, 331, 332, 121 A.2d 79 (1956); A. Jahr, Law of Eminent Domain § 176 at 290-91 (1953); 2 J. Lewis, Law of Eminent Domain § 742 (3d ed. 1909); 3 J. Sackman, Nichols The Law of Eminent Domain § 8.63 (1977); 1 L. Orgel, Valuation Under the Law of Eminent Domain § 5 (2d ed. 1953); and Annot. 36 A.L.R.2d 337, 413, § 46 (1954). Two things must be borne in mind. (1) The statutory scheme in all states is not the same as that in Maryland. As we noted at the outset, absent invocation of the so-called "quick take" statutes authorized by Constitution Art. III, §§ 40A-40D, at the time here applicable Art. 21, § 12-103 provided that title to the land was deemed to be taken "upon payment of the judgment and costs by the plaintiff pursuant to Subtitle U of the Maryland Rules." It thus follows that the State has no right of entry in a conventional eminent domain proceeding until payment has been made. (2) No contention has been made by Walker that the legal rate of interest of 6% Provided by Constitution Art. III, § 57 and specified by our cases as the rate to be paid under Maryland Rule 642 on judgments is a constitutionally infirm rate.

The out-of-State cases cited in support of Walker's position here are, almost without exception, cases involving statutory schemes different from that of Maryland relative to eminent domain. The only agencies of this State (as differentiated from certain subdivision) authorized to take land by condemnation without first having a jury determine the amount of damages are the State Roads Commission and the Washington Suburban Sanitary Commission Constitution Art. III, §§ 40B-40D. ¹ By Code (1977) § 8-331, Transportation Article, in the event a final award is in excess of the sum deposited in court under § 8-323 as a condition precedent to entry on the land by the State Roads Commission for the purpose of possession, then at the conclusion of the proceedings the Commission must pay the property owner interest on the excess from the date of payment under § 8-323 "at the rate of 6 percent a year." To like effect see Code (1974, 1978 Cum.Sup.) § 312-106(c), Real Property Article, and Hammond v. State Roads Comm., 241 Md. 514, 217 A.2d 258 (1966). This sum is identical with that specified in 40 U.S.C. § 258a, the Declaration of Taking Act, for payment under similar circumstances by the Federal government.

This case establishes once again that "there is nothing new under the sun." ² Harness v. Chesapeake & O. Canal Co., 1 Md.Ch. 248 (1848), is factually similar, although there was no argument in that case as to the rate of interest which should be paid. There an Allegany County jury returned an inquisition as to the amount of damages for land being condemned. The condemnor entered into possession of the land after the inquisition was ratified. It made excavations upon it, but failed to pay the amount of the inquisition. The chancellor said, "(T)he obligation to pay interest would seem to follow as of course, unless there are other circumstances exonerating them from the duty." Id. at 260-61. He found none. We should point out that judgments at law have not always carried interest until paid. Judge Bowie said for our predecessors in City Pass. R. W. Co. v. Sewell, 37 Md. 443 (1873):

It is established . . . that judgments in this State did not carry interest at common law, but were made to do so by comparatively recent Acts of Assembly. Chief Justice Taney, in Perkins v. Fourniquet, 14 How. ((55 U.S.) 328,)...