Case Title: De Bruhl v. STATE HIGHWAY AND PUBLIC WORKS COM'N

Citation: 102 S.E.2d 229, 247 N.C. 671

Docket Number: 

State: north-carolina

Court: North Carolina Supreme Court

Date: 1958-02-26T00:00:00Z

Document:
102 S.E.2d 229 (1958) 247 N.C. 671 Arthur M. DE BRUHL and wife, Janle W. De Bruhl, Petitioners. v. STATE HIGHWAY AND PUBLIC WORKS COMMISSION, Respondent. No. 98. Supreme Court of North Carolina. February 26, 1958. *230 George B. Patton, Atty. Gen., R. Brookes Peters, Asst. Atty. Gen., and McLean, Gudger, Elmore & Martin, Associate Counsel, Asheville, for respondent-appellant. Sanford W. Brown, Asheville, for petitioners-appellees. PARKER, Justice. For the six years prior to 1948 petitioners were the owners of a lot on the south side of Druid Drive in the City of Asheville, fifty feet wide and about one hundred and forty-eight feet deep. Situate on the lot was a brick veneer house in which petitioners lived. Work for relocating and reconstructing U. S. Highways 19-23 through a section of West Asheville was begun under Project 9075 for the first lane by respondent in 1949. For this purpose respondent in 1949 purchased from petitioners for $4,700 a right of way across the back portion of their lot and the back part of their house on the right of way. *231 Petitioners continued to live in their house. In March 1952 respondent began work for widening U. S. Highways 19-23 to dual lane highways under Project 9086. To do this it was necessary for respondent to acquire all the remaining part of petitioners' lot and all the remaining part of their house thereon. On 7 May 1952 the respondent in the exercise of its power of eminent domain appropriated all this remaining property of petitioners by going thereon and delivering to petitioners a copy of the letter and notice of condemnation, and erected a sign thereon reading: "This lot appropriated for highway purposes. SH & PWC, May 7, 1952." Petitioners continued to live in the house, until they were ejected therefrom and from the lot, under a court judgment in a proceeding brought by respondent for that purpose. In June or July 1952 respondent completely demolished the house. It would seem, though the evidence is not entirely clear, that the back portion of the house purchased by respondent in 1949, which was fifteen feet on the west side, and eleven feet on the east side, was not torn down until after 7 May 1952. Petitioners and respondent being unable to agree upon the compensation justly owing to the petitioners for the taking under the power of eminent domain of their property by respondent, the petitioners on 24 November 1952 instituted a proceeding under the provisions of Ch. 40 of the General Statutes to recover just compensation. G.S. § 136-19; Proctor v. State Highway Commission, 230 N.C. 687, 55 S.E.2d 479. In their petition, petitioners alleged that they were entitled to recover $22,800. Respondent in its answer denied that petitioners are entitled to recover that amount, but do not allege what amount they should recover. Commissioners appointed by the Clerk of the Superior Court of Buncombe County reported to the court in August 1953 that compensation in the amount of $4,750 ought justly to be made to petitioners. Exceptions to the report were filed by respondent in August 1953, and by petitioners in September 1953. Pursuant to notice and motion, the Clerk on 30 September 1953 overruled the exceptions, and entered judgment confirming the report of the commissioners, and ordering that petitioners have and recover from respondent the sum of $4,750. Respondent in open court gave notice of appeal from the judgment, and demanded a jury trial. On 5 October 1953 the Clerk transferred the proceeding to the civil issue docket of Buncombe County. At the 4 October 1954 Civil Term of the Superior Court of Buncombe County, Judge Dan K. Moore at a pre-trial conference ordered this one issue to be submitted to the jury: "What amount are petitioners entitled to recover of respondent for the land, excluding the house thereon, condemned for highway purposes on the 7th day of May 1952?" Petitioners excepted to the order, and appealed to the Supreme Court. In this Court the appeal was dismissed as premature, but without prejudice (1) to petitioners' exception to the order, or (2) to their rights in accordance with law and procedure in such cases. DeBruhl v. State Highway Commission, 241 N.C. 616, 86 S.E.2d 200. The proceeding came on to be heard at the March Term 1956 of Buncombe County Superior Court before Judge P. C. Froneberger and a jury. At a pre-trial conference Judge Froneberger held that the issue settled by Judge Moore was correct. This issue was submitted to the jury, and it was answered by them $12,500. Judgment was entered on the verdict, and the respondent excepted, and appealed to the Supreme Court. The appeal is reported in 245 N. C. 139, 95 S.E.2d 553, 558. Rodman, J., in concluding the opinion for the Court, said: A new trial was ordered. After the second appeal respondent by leave of court filed an amended answer, and an amended further answer, admitting, as held in the opinion, that it did not acquire in 1949 any portion of the house or lot lying outside the right of way it purchased from petitioners. At the trial at the March-April 1957 Civil Term of the Buncombe County Superior Court, petitioners and respondent offered evidence tending to show the fair market value of the property when it was condemned by respondent on 7 May 1952. Respondent assigns as error the part of the charge quoted below, which is in parentheses: "Eminent domain is the power of the sovereign to take or damage private property for a public purpose on payment of just compensation." Hedrick v. Graham, 245 N.C. 249, 96 S.E.2d 129, 134. Article I, Section 17, of the North Carolina Constitution states that no person ought to be in any manner deprived of his property, but by the law of the land. "The law of the land and due process of law are interchangeable terms." Eason v. Spence, 232 N.C. 579, 61 S.E.2d 717, 721. Practically every State in the Union, North Carolina excepted, contains an express constitutional provision against the taking of private property for public use without the payment of just compensation. Jahr, Eminent Domain, Sec. 36. However, North Carolina recognizes this fundamental right to just compensation as so grounded in natural law and justice that it is part of the fundamental law of the State, and imposes upon a governmental agency taking private property for public use a correlative duty to make just compensation to the owner of the property taken. This principle is considered in North Carolina as an integral part of "the *233 law of the land" within the meaning of Article I, Section 17, of the State Constitution. Sale v. State Highway Commission, 242 N.C. 612, 89 S.E.2d 290; Eller v. Board of Education, 242 N.C. 584, 89 S.E.2d 144; Proctor v. State Highway Commission, supra; Sanders v. Atlantic Coast Line R., 216 N.C. 312, 4 S.E.2d 902; Ivester v. City of Winston-Salem, 215 N.C. 1, 1 S.E.2d 88. Under the due process clause of the 14th Amendment to the United States Constitution no State can deprive an individual of his property without just compensation. Delaware, L., & W. R. Co. v. Town of Morristown, 276 U.S. 182, 48 S. Ct. 276, 72 L. Ed. 523, 56 A.L.R. 756; Pennsylvania Coal Co. v. Mahon, 260 U.S. 393, 43 S. Ct. 158, 67 L. Ed. 322, 28 A.L.R. 1321. This amendment is a limitation on the powers of the States. Sale v. State Highway Commission, supra; Yarborough v. North Carolina Park Commission, 196 N.C. 284, 145 S.E. 563. It adds nothing to the rights of one citizen against another. It simply furnishes a guaranty against any encroachment by the State on the fundamental rights belonging to every citizen. United States v. Cruikshank, 92 U.S. 542, 554, 23 L. Ed. 588, 592. "The constitutional guaranty of just compensation is not a limitation of the power to take, but only a condition of its exercise." Long Island Water-Supply Co. v. City of Brooklyn, 166 U.S. 685, 17 S. Ct. 718, 720, 41 L. Ed. 1165. Thus, the payment of just compensation to petitioners for the taking of their property for public use by the respondent State Highway and Public Works Commission, an agency of the State government, is protected by Article I, Section 17, of the North Carolina Constitution, as we have interpreted it, and by the 14th Amendment to the Constitution of the United States. The fundamental principle that private property cannot be taken by eminent domain without just compensation requires that the fair market value of the property condemned shall be determined as of the date of the taking, and unaffected by any subsequent change in the condition of the property. North Carolina State Highway Commission v. Black, 239 N.C. 198, 79 S.E.2d 778; Western Carolina Power Co. v. Hayes, 193 N.C. 104, 136 S.E. 353; United States v. Chandler-Dunbar W. P. Co., 229 U.S. 53, 33 S. Ct. 667, 57 L. Ed. 1063; 29 C.J.S. Eminent Domain § 185. A question presented by respondent's assignments of error Numbers 31 and 32 to the charge quoted above is this: Are the petitioners, whose property was taken for public use on 7 May 1952 by the respondent, an agency of the State government, and who in June 1952 were physically dispossessed and ejected therefrom by a court order procured by respondent, entitled to have the jury at the March-April 1957 Civil Term of Court award them compensation not only for the bare fair market value of their property taken by respondent to be determined as of the date of the taking, but also to have the jury award them some additional sum for the substantial delay in the payment of the fair market value of their property so taken, as an element of the just compensation guaranteed by Article I, Section 17, of the North Carolina Constitution, as we have construed it, and by the 14th Amendment to the United States Constitution, when there is nothing in the record to show that the cause of the delay was petitioners' fault, the parties apparently being content to have just compensation for the taking of the property determined in appropriate legal proceedings? This question is squarely raised by respondent's assignments of error Numbers 31 and 32. The answer to the question is, Yes. The view of the United States Supreme Court is illustrated by Kieselbach v. Commissioner of Int. Revenue, 317 U.S. 399, 63 S. Ct. 303, 87 L. Ed. 358; Brooks-Scanlon Corp. v. United States, 265 U.S. 106, 44 S. Ct. 471, 68 L. Ed. 934; and Seaboard Air Line R. Co. v. United States, 261 U.S. 299, 43 S. Ct. 354, 67 L. Ed. 664. The Fifth Amendment to the United States Constitution, which is a limitation upon the federal *234 government and not upon the States, Brown v. State of New Jersey, 175 U.S. 172, 20 S. Ct. 77, 44 L. Ed. 119, provides that private property shall not be taken for public use without just compensation. Article I, Section 17, of the North Carolina Constitution uses language of similar import. In Kieselbach v. Commissioner of Int. Revenue, supra [317 U.S. 399, 63 S. Ct. 305], the Court said: In Brooks-Scanlon Corp. v. United States, supra [265 U.S. 106, 44 S. Ct. 474], the Court said: In Seaboard Air Line R. Co. v. United States, supra [261 U.S. 299, 43 S. Ct. 355], the Court said: See also Bailey v. Anderson, 326 U.S. 203, 66 S. Ct. 66, 90 L. Ed. 3. *235 In Clark v. Cox, December 3, 1947, 134 Conn. 226, 56 A.2d 512, 514, one question to be decided on appeal was whether, where the defendant, Highway Commissioner, has condemned and taken plaintiffs' land for highway purposes pursuant to Section 1528 of the Connecticut General Statutes, as amended, they are entitled to receive interest from the date of taking until the date of judgment as an element of the just compensation guaranteed by Article First, Section 11, of the Connecticut Constitution and the 14th Amendment to the United States Constitution. Article First, Section 11, of the Connecticut Constitution reads: "The property of no person shall be taken for public use, without just compensation therefor." The Court said: The Court held that plaintiffs are not limited to the value of their property taken by eminent domain for highway purposes by the Highway Commissioner, but they are entitled by the guaranties of Article First, Section 11, of the Connecticut Constitution and of the 14th Amendment to the United States Constitution to such addition as will produce a full equivalent of that value paid contemporaneously with the taking, and interest at a proper rate is a good measure by which to ascertain the amount so to be added. Gitlin v. Pennsylvania Turnpike Commission, March 13, 1956, 384 Pa. 326, 121 A.2d 79, 81, was a proceeding to determine the damages due the plaintiffs for the appropriation of their property for highway purposes by the defendant, an instrumentality of the Commonwealth of Pennsylvania. On plaintiffs' petition the court below appointed a board of view for the ascertainment of the damages due the plaintiffs for the appropriation of their property. The viewers appraised the value of the property taken, and awarded the value of the property taken, and damages for delay in payment of the value of the property taken at the rate of four per cent per annum. The judge below confirmed the viewers' report and award. Article I, Section 10, of the Pennsylvania Constitution, P.S. reads: "* * * nor shall private property be taken or applied to public use, without authority of law and without just compensation being first made or secured. "On appeal the defendant contended that it is not liable for damages for delay in payment of the sum due for property which it appropriates by condemnation, and bottomed its contention upon the assertion that the Commonwealth of Pennsylvania is not liable in damages for delay in payment for *236 property condemned by it and that, since the Turnpike Commission is an instrumentality of the Commonwealth, it is likewise free from liability in such regard. The Supreme Court of Pennsylvania in affirming the order of the court below said: In State v. Deal, June 27, 1951, 191 Or. 661, 233 P.2d 242, the plaintiff, State of Oregon, through its State Highway Commission, appealed from a judgment based on the verdict of a jury in a condemnation action. In reversing the judgment below and remanding the cause to the Circuit Court for further proceedings, the Court deeming it expedient, for the guidance of the court below and counsel in this and future cases expressed their unanimous views on the point we are discussing, which was similar to what this Court did on another point in the former appeal of this case in 245 N.C. 139, 95 S.E.2d 553. The Court after stating that Article I, Section 18, of the Oregon Constitution provides in part: "Private property shall not be taken for public use * * * without just compensation," and that the Fifth Amendment to the United States Constitution contains substantially the same provision, and citing many cases of the United States Supreme Court construing the language of the Fifth Amendment to the United States Constitutionamong them two of the cases we have quoted from abovesaid: In Flemming v. Board of Com'rs, 119 Kan. 598, 240 P. 591, 593, the jury found the actual damages for location of the road to be $251.50, having been specifically instructed by the court not to include any interest in reaching their verdict. In a special question submitted by the court the jury found that the amount of interest at six per cent on the damages from the time of the location of the road until the time of the trial was $105.63. In entering judgment the court added this amount to the general verdict and rendered judgment for $357.13. Appellants contended this was error because the county was not liable for interest on its obligations unless specially made so by statute. The Court said: The court affirmed the lower court, with a slight modification, reducing the judgment by $11.50 with interest. The principle of law we are discussing, in many of its ramifications, has been thoroughly considered in Arkansas-Missouri Power Co. v. Hamlin, Mo.App., March 2, 1956, 288 S.W.2d 14, 17. In that scholarly opinion many of the cases, annotations and texts are collected. The learned Judge Ruark said in the opinion: In Jahr, Eminent Domain, Sec. 176, it is said: Many cases are cited to support the text. In 29 C.J.S. Eminent Domain § 176(a), it is said: Many cases are cited to support the text. In Orgel on Valuation under Eminent Domain, Second Ed., Vol. I, Sec. 5, it is written: A very comprehensive annotation setting forth the bulk of the case law on the subject can be found in 36 A.L.R.2d beginning on page 413, under the title VIII, Eminent Domain in sections 46, 47, 48, 49, 50 and 51. See earlier annotations in 111 A.L.R. page 1304, VIII, Eminent Domain, and 96 A.L.R., page 150, VIII, Eminent Domain. See also Nichols on Eminent Domain, Third Ed., Vol. 3, Sec. 8.63, where cases are cited from most of the States and from many United States Courts, and Lewis, Eminent Domain, 3rd Ed., Vol. 2, Sec. 742. Yancey v. North Carolina State Highway Commission, 221 N.C. 185, 19 S.E.2d 489, 491, was a special proceeding to recover compensation for lands taken and easements imposed in areas of the Blue Ridge Parkway. The petitioners were permitted to harvest crops on the lands for the years 1937 and 1938, and the actual deprivation of possession was delayed beyond the date of appropriation. Petitioners contended that they were entitled to interest on the verdict fixing compensation from the date of the original appropriation as a matter of law. The Court held that upon the present record the petitioners were not entitled to add interest to the verdict. Stacy, C. J., in writing the Court's opinion used this significant language: Manifestly, this case is no authority upon the question we are discussing. Thereafter in the trial court petitioners entered a motion in the cause, denominated *239 a petition for mandamus, to compel the payment of interest on the judgment from the date of its rendition to the time of payment. Respondent demurred ore tenus to the petition and motion. The demurrer was sustained, and petitioners appealed, Yancey v. North Carolina State Highway Commission, 222 N.C. 106, 22 S.E.2d 256. The decision of the lower court was affirmed. Devin, J., in writing the Court's opinion, after referring to decisions of the United States Supreme Court, which hold that just compensation is provided by the Fifth Amendment to the United States Constitution and "where the United States condemns and takes possession of land before ascertaining or paying compensation, the owner is not limited to the value of the property at the time of the taking; he is entitled to such addition as will produce the full equivalent of that value paid contemporaneously with the taking" (Seaboard Air Line R. Co. v. United States, supra [261 U.S. 299, 43 S.Ct. 356]), used this language: Obviously, this case does not decide the question we have for decision, nor does North Carolina State Highway and Public Works Commission v. Privett, 246 N.C. 501, 99 S.E.2d 61. Miller v. City of Asheville, 112 N.C. 759, 16 S.E. 762, was an appeal from an assessment of damages in condemnation proceedings instituted by the City of Asheville for widening a street. The court instructed the jury in part "that they should allow interest upon such sum as they assessed as damages to the property, if they assessed any." The Court held this was proper. See the fifth headnote to this case in our Reports. The State reprint in 1922 of the original volume of our Reports containing this case omits over five pages of the statement of facts, including the court's charge we have quoted. We are advertent to Abernathy v. South & W. R., 159 N.C. 340, 74 S.E. 890, and Raleigh, C. & S. R. Co. v. Mecklenburg Manufacturing Co., 166 N.C. 168, 82 S.E. 5, L.R.A.1916A, 1079. As to these cases see Annotation 36 A.L.R.2d at page 435. These two cases did not involve the State's taking of private property for public use, and therefore the 14th Amendment to the United States Constitution, which guarantees against any encroachment by the State on the fundamental rights belonging to every citizen, did not apply, and further, the precise question we are considering was not presented for decision in those two cases. In the instant case petitioner's property was condemned for public use by respondent, an agency of the State government, who in June 1952 physically dispossessed and ejected petitioners from their property, totally demolished their house, and have been using the property since for highway use. Under the facts of this case to hold that petitioners do not have a strict legal right to have the jury award them some additional sum for the delay in the payment of the value of their property on the taking date as an element of just compensation would plainly violate the fundamental rights guaranteed to petitioners by the 14th Amendment to the United States Constitution, as that amendment has been construed by the United States Supreme Court, and also guaranteed to them by Article I, Section 17, of the North Carolina Constitution, as we have interpreted it. To hold that petitioners are entitled to recover *240 as a legal right such additional sum for delay in payment as an element of just compensation under the 14th Amendment to the United States Constitution, and to hold that under Article I, Section 17, of the State Constitution such additional sum may be allowed in the discretion of the jury, and not as a matter of legal right, would be a strange holding, and would not benefit respondent. It is clear that the part of the court's charge set forth above in the first parenthesis, which is challenged by respondent's assignment of error Number 31, is taken in a large part verbatim from the language of the United States Supreme Court in Seaboard Air Line R. Co. v. United States, which we have quoted above. The court in this challenged part of the charge after saying in effect the respondent had taken the use of petitioners' property, charged: "So that the petitioners, the owners of the property, are entitled to have the full equivalent of the value of such use at the time of the taking, and to have that paid contemporaneously with the taking." The court should have charged that the petitioners are entitled to have the fair market value of their property at the time of the taking, etc. Ervin, J., said for the Court in North Carolina State Highway Commission v. Black, supra [239 N.C. 198, 79 S.E. 784]: "Since the condemner acquires the complete right to occupy and use the entire surface of the part of the land covered by the perpetual easement for all time to the exclusion of the landowner, the bare fee remaining in the landowner is, for all practical purposes, of no value, and the value of the perpetual easement acquired by the condemner is virtually the same as the value of the land embraced by it." In charging as it did, the court committed technical error, but it would seem that it was not harmful to respondent. The trial court, however, in the part of its charge set forth above in the second parenthesis, which is challenged by respondent's assignment of error Number 32, committed error prejudicial to respondent, when, after instructing the jury "you should take into consideration, * * * the intervening delay since June 1952, when the petitioners were deprived of their property; you will consider that delay up till this time, that is the time when the award is allowed, and you will affix your award accordingly," it did not go further and instruct the jury as to the rule they should follow to ascertain the additional sum to award the petitioners for the delay in the payment of the value of their property on the taking date. A reading of the charge in its entirety shows that nowhere in it did the trial court give the jury any criterion, rule, method or standard to guide them in this respect. It is the duty of the trial court of its own motion and without request to instruct the jury correctly as to the proper rule they should follow to ascertain the additional sum to award the petitioners for the delay in the payment of the fair market value of their property on the taking date, as an element of the just compensation guaranteed to them by the provisions of the United States and the North Carolina Constitutions. G.S. § 1-180; Adams v. Beaty Service Co., 237 N.C. 136, 74 S.E.2d 332; Wilson v. Wilson, 190 N.C. 819, 130 S.E. 834; Brewington v. Loughran, 183 N.C. 558, 112 S.E. 257, 28 A.L.R. 1543; Cherry v. L. J. Upton, 180 N.C. 1, 103 S.E. 912; Coles & Sons Co. v. Standard Lumber Co., 150 N.C. 183, 63 S.E. 736. In an annotation in 36 A.L.R.2d at pages 418-420 is given a number of cases which contain express statements to the effect that interest is not awarded as such, but that the equivalent of interest is given as damages for the detention of the compensation. In the same annotation at pages 420-421 is given a list of other cases which contain statements to the effect that something in the nature of interest must be included in the award in order to produce the full equivalent of the value of an award paid contemporaneously with the taking. It would seem that the above distinction is *241 one of words rather than of substance, and that both views in essence mean that the additional sum awarded for delay in payment of the value of the property taken is not interest eo nomine, but interest is a fair means for measuring the amount to be arrived at of such additional sum. Ordinarily, the legal rate of interest, where the condemned property is located, upon the original sum fixed as compensation for the fair market value of the property on the taking date, is considered a fair measure of the amount to compensate the owner for the delay in paying the award, so as to make just compensation. Miller v. City of Asheville, supra; Seaboard Air Line R. Co. v. United States, supra; In re City of New York, 179 N.Y. 496, 72 N.E. 522; State v. Deal, supra; 29 C.J.S. Eminent Domain § 176, p. 1055; Orgel on Valuation under Eminent Domain, Second Ed., Vol. I, p. 27; Annotation 36 A.L.R.2d at page 436; Jahr, Eminent Domain, Sec. 176. See Nichols on Eminent Domain, Third Ed., Vol. 3, Sec. 8.63(3). In the absence of statutory authority, compound interest should not be awarded. 29 C.J.S. Eminent Domain § 176, p. 1056; Nichols, ibid. The North Carolina Constitution contains no provision as to rates of interest. The rate of interest in this State is statutory. Moore v. Beaman, 112 N.C. 558, 17 S.E. 676. The legal rate of interest in this State is six per cent. G.S. § 24-1. On the facts before us, we hold as a matter of law that petitioners are entitled to have the jury award them interest at the rate of six per cent from the day of the taking of their property by respondent on whatever sum they may find to be the fair market value of their property on the taking date, such interest to be deemed an additional sum awarded to petitioners for respondent's delay in payment of their property taken, as an element of the just compensation guaranteed to them by Article I, Section 17, of the North Carolina Constitution, and by the 14th Amendment to the United States Constitution. For error in the charge, we are required to order a New trial.