Case Name: Frank D. Reter (also called Frank Reter) et al., appellees, v. Davenport, Rock Island and North Western Railway Company, an Iowa corporation, appellant
Court: Iowa Supreme Court
Jurisdiction: Iowa
Decision Date: 1952-09-16
Citations: 243 Iowa 1112
Docket Number: No. 48017
Parties: Frank D. Reter (also called Frank Reter) et al., appellees, v. Davenport, Rock Island and North Western Railway Company, an Iowa corporation, appellant.
Judges: MulRONEy, C. J., and Bliss, Oliver, Garfield, MaNtz, and ThompsoN, JJ., concur.
Reporter: Iowa Reports
Volume: 243
Pages: 1112–1134

Head Matter:
Frank D. Reter (also called Frank Reter) et al., appellees, v. Davenport, Rock Island and North Western Railway Company, an Iowa corporation, appellant.
No. 48017.
(Reported in 54 N.W.2d 863)
September 16, 1952.
Lane & Waterman, of Davenport, and E. C. Halbach, of Clinton, for appellant.
Adam A. Kreuter and George C. Claassen, both of Cedar Rapids, for appellees.

Opinion:
Smith, J.
On February 12, 1947, defendant and Clinton Industries, Inc., united in an application to tbe Iowa State Commerce Commission for a certificate of necessity permitting condemnation of a sixty-foot right of way over plaintiffs' premises for additional switching and storage trackage to the Clinton Industries plant pursuant to chapter 481, Iowa Code 1946 (1950) I.C.A. (All Code citations refer to this Code.)
Over objections by plaintiffs and after due notice and hearing the commission (June 17, 1947) ordered that a "Certificate of Authority to condemn real estate be issued certifying that the parcel of land is essential for railroad purposes in connection with the providing of an industrial service track to the Clinton Industries, Inc., Clinton, Iowa." Any taking for "storage track" was denied and the width of the proposed right of way accordingly limited to thirty feet instead of sixty as asked.
Thereafter defendant instituted condemnation proceedings under the provisions of Code chapter 472 and the amount of the resulting award ($4500) was deposited with the sheriff. Plaintiffs' petition on appeal to the district court, August 15, 1947, named both defendant railway company and Clinton Industries as defendants.
After a long and involved series of procedural moves— motions, rulings and amendments to and recasting of pleadings— plaintiffs, on March 9, 1950, filed a "second amended and substituted recast petition" naming defendant railway company as sole defendant. Count I (our only concern here) prays that both the proceeding before the commerce commission and the subsequent condemnation proceeding "be voided and held to be of no force and effect in that it be adjudged there was and is no necessity for the condemnation of plaintiffs' said property." It also alleges the proposed taking "was.intended for purely private and not for public use."
The matter went to hearing August 14, and 15, 1950, on defendant's application (under rule 105, Rules of Civil Procedure) for "determination of points of law" raised in plaintiff's Count I. After some discussion among court and attorneys as to the issues and the nature of the hearing — whether de novo or otherwise— the weight to be given the commission's ruling and certificate of necessity, tbe admissibility of extrinsic evidence and tbe burden of proof, tbe court, with apparent approval of counsel, expressed a tentative opinion that two- issues were bere presented, one constitutional and- tbe other the validity of the commission's action under the evidence presented before it. To this plaintiffs' counsel added "one other related question whether or not the land being condemned bere is for private or for public purposes."'
Plaintiffs offered a transcript of the commerce commission hearing and the various objectors' exhibits in connection therewith. Defendant offered the commission's decision, order and certificate of authority or necessity and the blueprints submitted by defendant railway company and Clinton Industries at the héaring before the commission.
In addition plaintiffs called witnesses to show there was no necessity for the proposed taking and that it was in fact for a private and not a public purpose. The testimony was received subject to objection as in equity.
The trial court voided the- condemnation proceedings, squarely holding the proposed taking of plaintiffs' property was for a 'private use and therefore rmconstitutional, and that it was unnecessary to determine the question of necessity or the admissibility of testimony'on that point. Defendant appeals from the decision. The adequacy of the award (Count II) has not yet been litigated.
I. An' extensive statement of the physical facts is unnecessary. Clinton Industries, Inc. (now Clinton Foods, Inc.) was and is a large industrial concern engaged in processing corn and manufacturing various food products from com and soybeans. Its plant is located in Clinton along a branch of the Mississippi River known as Beaver Slough.
Plaintiffs own a smaller area also hying along Beaver Slough, and surrounded on all other sides by the Clinton Industries property. Plaintiffs' property was originally used in the conduct of a business of selling wood and ice and more recently coal. There is testimony they were contemplating sale of gravel to be brought up the Beaver Slough from other land owned by them farther downstream.
Both Clinton Industries and plaintiffs were served by spur tracks of the defendant railway company but Clinton Industries bad, in 1946, planned an extensive enlargement and rearrangement of its plant to meet its expanding business. The company claimed its then existing track connection with defendant was inadequate. The planned new right of way crossed plaintiffs' premises. Hence the joint application to the commerce commission and the long litigation leading to this appeal.
II. The power of eminent domain is inherent in the sovereign state and is not dependent on express constitutional grant. 29 C. J. S., Eminent Domain, section 2. The right to exercise the power is delegable to railroads because the use to which they devote the property is inherently public. Stewart v. Board of Supervisors, 30 Iowa 9, 19-26, 1 Am. Rep. 238; 29 C. J. S., Eminent Domain, section 37.
Code section 481.3 authorizes a railroad to acquire necessary light of way "by condemnation or purchase" for "a reasonably adequate and suitable spur track required for the successful operating of any existing * # * industry." It expressly provides "No such track is required to be constructed until the state commerce commission, after hearing, shall have declared the same to be necessary." There are some other qualifying provisions not material here.
Later sections (481.4, 481.5 and 481.6) provide that the one "primarily to be served" may be required to pay the cost of acquisition and construction. Section 481.7 furnishes a method by which the one "primarily to be served" may go to the commerce commission, which "after reasonable notice to the railroad company shall investigate and determine all matters in controversy and make such order as the facts will warrant." Section 481.8 provides that any subsequent user of the track shall repay "the one primarily to be served" an equitable proportion of the primary cost "to be determined by the commission."
In addition to these provisions of chapter 481, Code section 471.6 gives railroads the right to condemn for general railroad purposes and section 471.9, subsection 2 expressly authorizes condemnation for purposes of acquiring right of way for spur track:
"Any such corporation may, by condemnation or otherwise, acquire lands for the following additional purposes:
"2. For the purpose of constracting a track or tracks to any manufactory, warehouse, or mercantile establishment."
The provisions of Code chapter 481 clearly purport to authorize condemnation by a railroad company of right of way for a spur track even though it be originally intended to serve but one private industry. Code section 481.7 surely contemplates that a reluctant railroad could be compelled, upon application to the commission, to acquire such right of way in an appropriate case. Chicago & N. W. Ry. Co. v. Ochs, 249 U. S. 416, 419, 39 S. Ct. 343, 63 L. Ed. 679.
III. Is such litigation constitutional? Does it violate fundamental provisions, state and federal, against taking private property for private use ? Clearly the statutes above set out constitute legislative determination that the use referred to is public even though there be (as here) but one industry "primarily to be served."
The right of eminent domain being an attribute of sovereignty the legislature has the initial duty of determining what constitutes a public use. Sisson v. Board of Supervisors, 128 Iowa 442, 452, 453, 104 N.W. 454, 458, 70 L. R. A. 440; 29 C. J. S., Eminent Domain, section 30; 18 Am. Jur., Eminent Domain, section 146; Bankhead v. Brown, 25 Iowa 540, 545; Noll v. Dubuque B. & M. R. Co., 32 Iowa 66. "It is for that body [the legislature] to determine in the first instance what are the public uses, to subserve which a grant of power [to condemn] may properly be made. That this may not be done arbitrarily, and having no proper regard for the character of the conditions to which application is to be made, or the results to follow the use, may readily be conceded. It is to be said, however, that the doctrine common to statutory construction, from the viewpoint of the Constitution, is applicable here that interference on the part of the courts will not be warranted, except there be presented a clear, plain, and palpable case of transgression." Sisson v. Board, supra. See Bankhead v. Brown, 25 Iowa 540, 545, 546, in which Judge Dillon says: "But 'if a public use be declared by the legislature the courts will hold the use public, unless it manifestly appears by the provisions of the act, that they can have no tendency to advance and promote such public use.' Per Shaw, Ch. J., in Hazen v. Essex County, 12 Cush. 477." See also opinion by Judge Miller in Stewart v. Board of Supervisors, supra, 30 Iowa 9, 19 et seq.
It is in this constitutional sense only that the question of public use may be said to be judicial. It is ultimately for the courts only where constitutionality of the legislative declaration is questioned. As the rule is commonly stated: "Where the legislature declares a particular use to be a public use, the presumption is in favor of its declaration, and the courts will not interfere therewith unless the use is clearly and manifestly of a private character." 29 C. J. S., Eminent Domain, section 30, page 822. See also test of, and cases cited in, 18 Am. Jur., Eminent Domain, section 46.
IY. Coming to an application of this rule to the instant case we have no doubt of the constitutionality of the statutes involved here. The defendant railway company proposes to make the contemplated spur track a part of its railway system, subject to the same control and under the same public regulations and obligations as apply to the other parts thereof. In no sense is the proposed spur track to be the private property of Clinton Industries (now Clinton Foods, Inc.).
"The test of public character is not in the number of persons or corporations located along the line of a proposed branch, but in the character of the use to which the branch will be put." Vollick v. Lehigh Valley R. Co., 104 N. J. L. 283, 286, 140 A. 673, 674.
As said in Menasha Woodenware Co. v. Railroad Commission of Wisconsin, 167 Wis. 19, 25, 166 N.W. 435, 438, a case strikingly in point: "In its very nature it [a spur track] cannot serve the public in the complete manner that an extension [of the main line] does, because it is not intended for passenger service and it only reaches the property of one industry, or perhaps several; but its use is none the less public on the part of the one industry or the several industries which it serves, because thereby the one industry or the several industries are enabled to be reached by the public and to be served by the common carrier to the fullest extent. The service of any particular spur is denied to no industry which it is reasonably feasible for the spur to serve, provided the industry pay its equitable share of the cost; in other words, all concerns which can possibly have any occasion to use the track are given tbe right to' use it on tbe same equitable terms. Tbis must be held public use in a true sense, although not a public use of precisely the same quality as that which pertains to an extension of the main line of a railroad." .
See also the language in Tift v. Atlantic Coast Line R. Co., 161 Ga. 432, 441, 131 S.E. 46, 50: "If the track is opened to the public, to be used on equal terms by all wlm may at any time have occasion to use it, so that all persons who have occasion to do so can demand that they be served without discrimination, not merely by permission, and if the track is subject to governmental control under general laws, and in the same manner as are the main lines of a railroad, then the use is a public one." See Ulmer v. Lime Rock R. Co., 98 Maine 579, 57 A. 1001, 1004, 66 L. R. A. 387; Dotson v. Atchison, T. & S. F. R. Co., 81 Kan. 816, 106 P. 1045, 1047 et seq.
We think these authorities apply the correct test as to whether a contemplated use is public, although we are aware there is respectable authority which seems to hold otherwise. In Armstrong v. Illinois Cent. R. Co., 153 Tenn. 283, 295, 282 S.W. 382, 385, tbe Tennessee Supreme Court quotes with apparent approval the rule as stated in 20 C. J. 568:
"A branch or lateral roa'd or spur track necessary to the proper operation of the main line of a railroad, or which may be necessary,to connect important industries, or even a single industry, with the main line or other public highways, provided, however, that the general public has a right to use it, although such branch or lateral road or spur track may also subserve private interests, and private persons may contribute to the expense thereof, is a public use for which private property may be taken under the power of eminent domain." Same text 29 C. J. S., Eminent Domain, section 39.
The principle is thus stated in 18 Am. Jur., Eminent Domain, section 62: "When, however, the branch or spur is open to public use in the same manner as the rest of the railroad, the fact that when constructed it will lead to'the works of a single establishment and will probably be used almost wholly by that establishment is no bar to the acquisition of the necessary land by eminent domain." (Note 4.)
The Supreme Court of the United States has not hesitated to affirm state court decisions supporting tbe constitutionality of statutes such as we are considering. In Union Lime Co. v. Chicago & N. W. Ry. Co., 233 U. S. 211, 221, 34 S. Ct. 522, 525, 58 L. Ed. 924, 930, Justice Hughes, in considering a Wisconsin statute essentially similar to our own says: "A spur may, at the outset, lead only to a single incjustry or establishment; it may be constructed to furnish an outlet for the products of a particular plant; its cost may be defrayed by those in special need of its service at the time.' But none the less, by'virtue of the conditions under which it is provided, the spur may constitute at all times a part of the transportation facilities of the carrier which are operated under the obligations of public service and-aré subject to the regulation of public authority. There is a clear distinction between spurs which are owned and operated by a common carrier as a part of its system and under its public obligation and merely private sidings." See also Alton R. Co. v. Illinois Commerce Comm., 305 U. S. 548, 553, 59 S. Ct. 340, 342, 83 L. Ed. 344; Chicago & N. W. Ry. Co. v. Ochs, 249 U. S. 416, 419, 420, 39 S. Ct. 343, 63 L. Ed. 679, supra.
It would unduly -extend this opinion to- refer separately to the numerous authorities cited by plaintiffs. Many of them can be distinguished — some by reason of procedural differences and others because they do hot involve statutory provisions expressly determining that a certain proposed use is public as does our own here.
Under authorities already cited we cannot condemn the statutory determination of public use here unless it is plainly and palpably of a private character. We do not consider it to be such. Quite to the contrary we think the legislation sound and the use it authorizes clearly public in the true sense. A spur track is just as truly a part of the railroad as is the main line itself whether it serves one industry or a dozen. The public character of the service rendered-by it is not dependent on the number of industries it furnishes access to. Most spur tracks are necessarily limited in that respect.
We must assume, in favor of constitutionality, that the statute contemplates and that there is contemplated here, not a private siding controlled by the industry, but a spur track constituting a part of the railroad system and under the railroad com pany's control. Phillips v. Watson, 63 Iowa 28, 32, 18 N.W. 659. The language amply supports such assumption. So considered we think no charge of unconstitutionality can be sustained.
V. While the trial court did not pass on the question of necessity we must meet it by reason of our disagreement with the trial court's decision on the constitutional issue. Plaintiffs, by pleading and in argument, insisted the commission erred in granting defendant a certificate of necessity. They sought a judicial review de novo on that issue.
The legislature has clearly delegated to the commission the power to determine the question of necessity. Code sections 481.3, 471.10. The power so to delegate is unquestioned. Jager v. Dey, 80 Iowa 23, 45 N.W. 391; Eikenberry v. St. Paul & Kansas City Shortline R. Co., 174 Iowa 6, 12, 156 N.W. 163; 18 Am. Jur., Eminent Domain, section 106; 29 C. J. S., Eminent Domain, sections 87, 89b.
. We find no statutory provision for any appeal from the decision of the commerce commission in ordering or refusing to order a certificate of necessity under these statutes. The question is primarily legislative. Doubtless, however, certiorari would lie to question whether the commission exceeded its authority or otherwise acted illegally, notwithstanding our rule 306, B. C. P., now limits such remedy to inferior boards or tribunals "exercising judicial functions." Massey v. City Council, 239 Iowa 527, 530-533, 31 N.W.2d 875. The act of the commerce commission in such case is certainly quasi judicial. We need not explore that procedural probability however since plaintiffs have made no attack by either appeal or certiorari.
Waiving any technical question of procedure we think there is in this record no showing the commission acted illegally or exceeded its jurisdiction or abused its discretion. 73 C. J. S., Public Administrative Bodies and Procedure, sections 216-218. The one consideration strenuously urged by plaintiffs is the one already discussed, viz., that it clearly appears the proposed new track is for- the sole accommodation of but one industry and can never, because of its surroundings, be of any service to any other. That contention relates to the question of public use and has been determined by the legislature adversely to plaintiffs. What ever may be tbe position of other courts and other statutes, we deem our legislation in that respect constitutional and broad enough to cover the situation shown here. And since the proposed use is public the commerce commission here did not abuse its discretion in its finding of the existence of public necessity.
We agree with the excellent statement of the trial court at this point: "It is the general rule that where the intendéd use of property sought to be taken by condemnation is public, the necessity and expediency of the taking may be determined by the public body or agency, in this case the State Commerce Commission, and in such mode as the State may designate, and under such circumstances the courts will not inquire into the necessity or propriety of the taking." (Italics supplied.)
The commission, in a case such as this, sits as an impartial tribunal to pass on the question of necessity. It does not originate the proposed plan but acts as umpire to safeguard the interests of all parties affected, including the public. Its action is judicial in character. The case of Havner v. Iowa State Highway Comm., 230 Iowa 1069, 300 N.W. 287 (cited by plaintiff) involved the decision of an administrative body engaged in carrying out a plan initiated by itself. While this does not change the rule governing us in reviewing the action, the interest of the commission is a circumstance to be considered in determining whether it has abused its discretion.
But the Havner case is not authority for a rule permitting a review de novo on appeal on the issue of public necessity. Porter v. Iowa State Highway Comm., 241 Iowa 1208, 1217, 44 N.W.2d 682. The last cited case practically limits the effect of the Havner decision to "the exceptional case" where the authority and power of the commission "has been abused." See Bennett v. City of Marion, 106 Iowa 628, 632, 633, 76 N.W. 844.
Our decisions in cases where statutory appeal from the commission's rulings is provided are persuasive here. Even in those decisions we have consistently held the question of convenience and necessity is legislative, not judicial, and that upon appeal the court considers only judicial questions — whether the commission has exceeded its jurisdiction, whether the questioned order is without support in the record or is wholly arbitrary and unreasonable. See e.g., In re Application of Illinois Cent. R. Co., 241 Iowa 333, 337, 41 N.W.2d 98; In re Application of National Freight Lines, 241 Iowa 179, 186, 40 N.W.2d 612, and cases therein cited.
The general rule is thus stated in 73 C. J. S., Public' Administrative Bodies and Procedure, section 216a: "In the absence of fraud, lack of jurisdiction, or arbitrary or capricious action, an administrative agency's finding of fact is to be accepted as final, binding, and conclusive, and is not to be reviewed by a court except to the extent that a constitutional or statutory provision makes the finding reviewable by a court." See also discussion in 42 Am. Jur., Public Administrative Law, section 209.
We think the finding of the commerce commission here on the question of necessity had adequate support and that there are no legal grounds for setting it aside.
VI. Plaintiffs have cross-appealed from the denial of their claim for attorney fees made under Code section 472.33 which provides: "The applicant [defendant here] shall pay all costs occasioned by the appeal, including reasonable attorney fees to be taxed by the court, unless on the trial thereof the same or a less amount of damages is awarded than was allowed by the tribunal from which the appeal was taken." The "appeal" referred to is of course the one allowed by Code section 472.18 from the "assessment" — the appeal to the district court.
Manifestly the attorney fee contemplated by these statutes cannot be fixed now since it is not yet known whether plaintiffs will be .awarded an increased amount of damage when that issue is-tried under Count II of their petition.
We agree with the trial court's conclusion they are not and will not be entitled to attorney fees for services rendered on trial under their Count I. It involves the question of the constitutionality of the Code sections and the legality of the action of the commerce commission, not the sufficiency of the condemnation award.
Count I of the petition is in the nature of certiorari rather than of appeal. Had plaintiffs waived the question of the sufficiency of the award and relied upon the matters urged in their Count I the issues would have been triable in certiorari. Runner v. City of Keokuk, 11 Iowa 543; Abney v. Clark, 87 Iowa 727, 731, 55 N.W. 6. This is not meant as a suggestion that the issues presented by Count I were not properly triable in tbe manner adopted bere. We need not and do not decide tbat question, but see Stough v. Chicago & N.W. Ry. Co., 71 Iowa 641, 643, 33 N.W. 149. However the statement does emphasize that the issues presented by Count I are not logically a part of the appeal from the award but essentially constitute a separate proceeding.
It is axiomatic that attorney fees are not awarded as part of the costs unless clearly authorized by statute. Wilson v. Fleming, 239 Iowa 918, 32 N.W.2d 798; Wormely v. Mason City & Ft. D. Ry. Co., 120 Iowa 684, 95 N.W. 203.
We think the trial court's decision on this point must be upheld.
We have not followed the order of presentation adopted by the briefs, nor have we expressly decided every procedural contention presented. What we have said however disposes of every issue necessary to a complete determination on its merits of the appeal to this court without regard to procedural technicalities. It results that the case must be reversed on defendant's and affirmed on plaintiffs' appeal and remanded for trial on Count II of plaintiffs' second amended and substituted recast petition. — Reversed on defendant's appeal; affirmed on plaintiffs' appeal.
MulRONEy, C. J., and Bliss, Oliver, Garfield, MaNtz, and ThompsoN, JJ., concur.
Wennerstrum and Hays, JJ., dissent.
471.9 Additional purposes. Any such corporation owning, operating, or constructing a railway may, by condemnation or otherwise, acquire lands for the following additional purposes:
2. For the purpose of constructing a track or tracks to any mine, quarry, gravel pit, manufactory, warehouse, or mercantile establishment. .