Case Title: State Ex Rel. Weatherby Advertising v. Conley

Citation: 527 S.W.2d 334

Docket Number: 59005

State: missouri

Court: Missouri Supreme Court

Date: 1975-07-21T00:00:00Z

Document:
527 S.W.2d 334 (1975)
STATE of Missouri ex rel. WEATHERBY ADVERTISING COMPANY, INC., Relator,
v.
The Honorable Frank CONLEY, Judge of Division II of the Thirteenth Judicial Circuit, Respondent.
No. 59005.

Supreme Court of Missouri, En Banc.
July 21, 1975.
Rehearing Denied September 8, 1975.
*335 Hendren & Andrae by Alex Bartlett, Jefferson City, for relator.
Bruce A. Ring, Thomas E. Cheatham, State Highway Com'n, Jefferson City, for respondent.
John W. Ellinger, Jefferson City, for intervenor.
FINCH, Judge.
This is an original proceeding in prohibition wherein relator seeks to prohibit respondent judge from proceeding with two multi-tract condemnation actions filed by the Missouri State Highway Commission (hereinafter referred to as Commission) seeking to condemn land for federal aid highway projects.
In Boone County Case No. 56044 (hereinafter referred to as Riddick) relator owns two existing outdoor advertising structures located on property described as parcel No. 8 in the suit. The signs were built in 1962 pursuant to a lease with the owner. In 1973, in contemplation of selling right-of-way to the Commission, the owner of parcel No. 8 gave notice to relator terminating its lease. The Commission then purchased said right-of-way from the fee owner but no offer for the signs thereon was made to relator and Commission advised that it was not going to pay relator any compensation for the two signs. Thereafter Commission filed a petition in Riddick naming only relator as a defendant as to parcel 8.
In Callaway County Case No. 31903 (hereinafter referred to as Dodge) relator owned two sign structures on parcel No. 15, the fee interest in which belonged to one Sutterfield, and one sign on parcel No. 24 in which the fee interest was owned by Bemac, Inc. All of these structures had been placed pursuant to leases with the owners. Prior to condemnation, the Commission made an offer to Sutterfield on parcel 15, which was refused. The Commission, after suit was filed, made an offer on parcel 24 to Bemac, Inc., which was accepted. Bemac terminated its lease with relator prior to acceptance of the offer. No offer has been made to relator with reference to its signs on either tract.
After the condemnation petitions were filed, relator filed answers and counterclaims in each of the cases wherein it asserted, inter alia, the failure of the Commission to make a bona fide offer as a prerequisite to condemnation under traditional eminent domain law and the failure of the Commission to comply with the provisions of 42 U.S.C. § 4651 and 42 U.S.C. § 4652 of the Uniform Relocation Assistance and Land Acquisition Policies Act of 1970 (hereinafter referred to as Uniform Act), seeking to stop or enjoin the Commission from disturbing its properties or proceeding with the condemnation cases. The Commission then filed motions to dismiss both counterclaims. Respondent overruled these motions and subsequently entered orders of condemnation. No ruling specifically dealing with the counterclaims was entered, but the parties appear to be in agreement that the trial court indicated that it believed the orders of condemnation had disposed of the counterclaims.
After unsuccessfully seeking prohibition in the Missouri Court of Appeals, Kansas City District, the petition herein was filed. We issued a stop order and subsequently our preliminary rule in prohibition.
Twenty-four persons, all of whom are defendant property owners in Riddick and Dodge, plus two defendant property owners in another Boone County case (No. 56853) (hereinafter referred to as Moreau), have been allowed to intervene. They, too, assert non-compliance by the Commission with §§ 4651 and 4652 of the Uniform Act in the Commission's dealing with intervenors and they request that the Commission be compelled to comply with those statutory provisions.
Bemac, Inc. also was permitted to intervene. It asserts that relator's lease on its *336 property was terminated, that it had agreed with the Commission to convey its interest in parcel 24 in Dodge for the amount of a stipulated Commissioner's award but that it is being prevented from receiving the agreed upon settlement by reason of pendency of this prohibition proceeding.
It is well established in Missouri that allegation and proof that the condemnor and property owners have been unable to agree on compensation to be paid for the property being taken is jurisdictional. The rule is clearly enunciated in State ex rel. State Highway Commission v. Pinkley, 474 S.W.2d 46, 48-49 (Mo.App.1971), as follows:
The petitions in condemnation in these cases allege that "relator cannot agree with the defendants, owners of, or claimants of interest in the property, on the proper compensation, if any, to be paid for the tracts of land or rights herein set out." The sufficiency of such an allegation was sustained in the case of State ex rel. State Highway Commission v. Cady, 372 S.W.2d 639 (Mo. App.1963), but its adequacy is questionable. It merely asserts the conclusion that the Commission cannot agree with defendants on compensation. It does not allege that a settlement has been attempted or that offers have been made and rejected. One might believe at the outset that no agreement is possible and make no attempt to settle. The petition should allege enough to show that bona fide negotiations have occurred but that the parties were unable to *337 arrive at a settlement. In this case, concededly, the Commission has made no offer of any kind to relator with respect to any of the signs on any of the tracts which the Commission seeks to condemn. As a matter of fact, no negotiations have taken place. Instead, the Commission takes the position as to parcel 8 in Riddick and parcel 24 in Dodge, that relator has no rights since its lease has been terminated. It has advised relator that it will pay nothing for the signs on the tracts in question. With reference to parcel 15 in Dodge, where relator's lease is still outstanding, Commission says it need not make an offer to relator because Sutterfield, the fee owner, refused an offer of settlement.
Has the Commission sufficiently complied with applicable requirements for negotiations to settle as to vest jurisdiction in respondent? This question necessarily involves a consideration not only of the provisions of § 523.010,[1] discussed above in Pinkley, but also, since both Riddick and Dodge involve federal aid projects, § 226.150, which provides in pertinent part as follows:
The foregoing statutory provision, then designated as § 8106 RSMo 1929, was construed by this court in Logan v. Matthews, 330 Mo. 1213, 52 S.W.2d 989 (banc 1932). In that case citizens and taxpayers sought to enjoin the Commission from constructing a highway so as to miss the towns of Avalon and Tina. A section of a highway construction statute provided that the highway to be constructed would run through those two towns, but the federal government, which was to provide federal aid for the project, refused to contribute that aid unless a more direct route between Chillicothe and Carrollton was followed. Utilization of such route would bypass Avalon and Tina.
In holding that the Commission should build the highway according to the federal government's requirements, thereby obtaining federal aid for the project, this court said (52 S.W.2d at 992-93):
* * * * * *
Logan was followed in Davis Construction Co., Inc. v. State Highway Commission, 141 S.W.2d 214 (Mo.App.1940), the court saying, at 221-22:
See also Brown v. McMorran, 23 A.D.2d 661, 257 N.Y.S.2d 74 (1965); Eargle v. Richland County Permanent Roads Commission, 123 S.C. 368, 116 S.E. 445 (1923).
In view of the requirement of § 226.150, as construed in Logan and Davis Construction, that the Commission comply with the provisions of any act of congress or rules and conditions by the bureau of public roads (now the Federal Highway Administration of the Department of Transportation) as a condition to securing federal funds for highway construction, we must necessarily determine what those requirements are and whether they affect what we should do herein.
42 U.S.C. § 4651 provides in part as follows:
42 U.S.C. § 4652 provides:
42 U.S.C. § 4655 provides in part as follows:
*340 "(1) in acquiring real property it will be guided, to the greatest extent practicable under State law, by the land acquisition policies in section 4651 of this title and the provisions of section 4652 of this title . . .."
The stipulation between the parties filed herein discloses that there was an exchange of correspondence between representatives of the Federal Highway Administration and the Director of Highways for the Commission wherein the latter wrote to the Federal Highway Administration as follows:
Thereafter, the Director of Highways again wrote to the Federal Highway Administration as follows:
In response, the Federal Highway Administration, in a letter to the Director of Highways dated May 22, 1972, wrote as follows:
In spite of the requirements imposed on it by § 226.150 and notwithstanding the positive assurances given by the Director of Highways to the Federal Highway Administration in order to secure federal aid on Missouri highway projects, it is conceded that the Commission has not acted in these cases in accordance with the procedures spelled out in §§ 4651, 4652 and 4655. This has been true with reference to the respondent's structures in Riddick and Dodge and with reference to tracts belonging to the intervening property owners. The Commission's explanation is that 42 U.S.C. § 4602,[4] another section in the Uniform Act, specifically states, inter alia, that nothing in this chapter shall be construed as creating any element of value or damage in condemnation proceedings. Respondent urges that compliance with § 4651 is not a prerequisite to the right to condemn and that it merely *341 specifies guidelines for administrative action, not judicial enforcement. The Federal Highway Administration, says respondent, could cut off federal aid for non-compliance therewith, but property owners have no enforceable rights. Various federal decisions are cited in support of this position.[5]
The federal cases cited are not decisive of the issue we must resolve. They deal with situations wherein they look only to the federal statutes (the various sections of the Uniform Act) and determine therefrom whether those statutes create rights and obligations which the federal courts may enforce. That is not the question we must resolve. Instead, we must determine whether under § 226.150 the Commission must follow procedures even if it otherwise might not have been so obligated. More specifically, we must decide whether the General Assembly by enacting § 226.150 has directed the Commission to follow and comply with the requirements as to appraisal, negotiation and settlement offers spelled out in §§ 4651 and 4652 in those instances where federal highway aid is involved.
We conclude that it has. Section 226.150 very specifically states that the Commission shall comply with acts of congress or rules or conditions of agencies such as the Federal Highway Administration which are conditions for securing funds allocated to Missouri for highway construction. This it had a right to do and Logan and Davis Construction so recognized. This necessarily means that the bona fide effort to settle and avoid condemnation, required by virtue of § 523.010, now includes, where federal aid is involved, the obligation to do those things specified in §§ 4651, 4652 and 4655 in connection with efforts to settle and avoid litigation. These include (1) appraisal of the property before negotiation, with an opportunity for the owner to accompany the appraiser, (2) determination of the sum by which buildings, structures or other improvements which belong to tenants contribute to the fair market value of the real property to be acquired and, in the alternative, the fair market value of the structure for removal, (3) establishment of just compensation for the property to be acquired, which shall be no less than the approved appraisal, (4) furnishing the owner with a written statement of, and summary of the basis for, the amount established as just compensation, and (5) making an offer of the just compensation so established to the owner.[6] In the case of structures owned by tenants, such as those here involved, payment of the settlement is to be made to the tenant if the owner of the fee disclaims all interest in the improvements.[7]
Since the Commission has not made the appraisals or offers or done the other things hereinbefore enumerated which are conditions precedent under §§ 523.010 and 226.150 to jurisdiction in *342 respondent to proceed with the Riddick and Dodge condemnation suits, respondent lacks jurisdiction to appoint commissioners or to proceed further therein until the Commission complies therewith and amends the petitions in condemnation to so allege. In such a situation prohibition is an appropriate remedy. State ex rel. Gove v. Tate, 442 S.W.2d 541 (Mo. banc 1969). See also State ex rel. Clothier v. Yeaman, 465 S.W.2d 632, 634 (Mo. banc 1971).
In Moreau (in which two intervenors are involved), it is not clear from the record before us whether a federal aid highway project is involved. Intervenors allege that it is and that there was evidence in the record before respondent to so show, but they also allege that the Commission has refused to advise whether this case does or does not involve a federal aid project. It would serve no useful purpose for us to delay this proceeding until that question can be resolved. If, in fact, it is a federal aid project, what we have said herein should indicate the course to be followed.
Provisional rule in prohibition made absolute.
SEILER, C. J., and MORGAN and BARDGETT, JJ., concur.
HENLEY, J., dissents in separate dissenting opinion filed.
HOLMAN and DONNELLY, JJ., dissent and concur in separate dissenting opinion of HENLEY, J.
HENLEY, Judge (dissenting).
I am unable to agree with the holding of the majority opinion that because the condemnor has not complied with federal statutes the state court is without jurisdiction to act in these condemnation actions.
It is one thing to say that in order to secure federal-aid funds for Missouri highways the Commission shall comply with a federal law which provides for the distribution of those funds; it is quite another, in my opinion, to say that a court of this state does not have "jurisdiction" to act in a condemnation action, such as is involved here, unless the condemnor has first complied with requirements of a federal law.
That part of § 226.150 (the first sentence) quoted in the majority opinion first appeared in the laws of this state as a part of the Centennial Road Law adopted in 1921[1] and it was carried forward in exactly the same language in each revision of our statutes thereafter, including the most recent revision in 1969. It was a part of the great effort being made then to "get Missouri out of the mud," when a high percentage of the right-of-way acquired for highways was by way of gifts from those whose land adjoined the first hard-surfaced roads. It is difficult today to imagine that members of the 1917, 1919 or 1921 sessions of the General Assembly intended, or even dreamed, that § 226.150 would or could in a future day be used in connection with a later act of congress to effect a change in the law of eminent domain of this state. I say that with confidence partly because this legislation was enacted back in the day when men in the state legislature, and those in the congress, were apparently of the opinion it was desirable, if not in fact required, that the states give their assent to federal aid for road construction.[2]
If it is the intent of the General Assembly that the Commission shall have authority to institute and maintain a condemnation action only if it has first complied with these additional appraisal, negotiation and settlement offer provisions of 42 U.S.C., *343 §§ 4651 and 4652, it should say so now. It certainly does not purport to say so in § 226.150.
If these conditions are to be a determining factor in whether a state court has jurisdiction, it would be far better that the General Assembly say so than that the court, by way of "construction" of this fifty-year-old statute, say so by changing the law of eminent domain to require that the condemnor shall have complied with these particular federal requirements as well as those of Missouri.
I respectfully dissent.
[1]  All references to Missouri statutes are to RSMo 1969, V.A.M.S. unless otherwise indicated.
[2]  Sections 301, 302 and 305 of the Uniform Act, referred to in this correspondence, are now designated as §§ 4651, 4652 and 4655 of Title 42 U.S.C.
[3]  A subsequent notice to all states from the Federal Highway Administration dated June 1, 1973, noted that complaints had been received in connection with the handling of compensation for advertising signs located within highway right-of-way projects and called attention to the requirements of §§ 4652(a) and (b)(1) and discussed how they should be implemented.
[4]  "(a) The provisions of section 4651 of this title create no rights or liabilities and shall not affect the validity of any property acquisitions by purchase or condemnation.

"(b) Nothing in this chapter shall be construed as creating in any condemnation proceedings brought under the power of eminent domain, any element of value or of damage not in existence immediately prior to January 2, 1971."
[5]  For example, in Will-Tex Plastics Mfg., Inc. v. H. U. D., 346 F. Supp. 654 (E.D.Pa. 1972), aff'd, 478 F.2d 1399 (3d Cir. 1973), the court, after holding plaintiff had no rights because the property was acquired prior to the effective date of the Uniform Act, also held that plaintiff had no right to relief thereunder in the federal court because of the express provisions of § 4602(a). Other cases relied on include Barnhart v. Brinegar, 362 F. Supp. 464 (W.D.Mo.1973), and Paramount Farms, Inc. v. Morton, 384 F. Supp. 1294 (W.D.Wisc.1974). But see Bethune v. H. U. D., 376 F. Supp. 1074 (W.D. Mo.1972), and Whitman v. State Highway Comm'n, No. 1793 (W.D.Mo., filed May 6, 1975).
[6]  Respondent insists the Commission had no duty to appraise the structures belonging to relator and no duty to make an offer therefor, citing particularly Western Robidoux P. & L. Co. v. Missouri State Highway Comm'n, 498 S.W.2d 745 (Mo.1973), and City of St. Louis v. Wabash R. R., 421 S.W.2d 302 (Mo. banc 1967). Neither of these cases involved federal highway aid funds or a determination of the effect of § 226.150 and neither governs the rights of the parties in these cases.
[7]  Bemac has disclaimed interest in relator's structures on parcel 24 in Dodge. This also appears to be true in the case of parcel 8 in Riddick, although the record contains no express disclaimer. The record discloses nothing in this respect as to parcel 15 in Dodge.
[1]  Section 16, Laws of Missouri, 1921, (first extra session) pp. 132 and 138, which had its beginning in the Hawes Road Law, Laws of Missouri, 1917, p. 485.
[2]  Section 1, Laws of Missouri, 1917 (part of the Hawes Road Law), reads: "That assent is hereby given to an act of the congress of the United States, entitled: `An act to provide that the United States shall aid the states in the construction of rural post roads and for other purposes,' approved July 11, 1916." (emphasis supplied). See also: § 10889, RSMo 1919.