Case Name: DETROIT, BAY CITY & WESTERN RAILROAD CO. v. FIRST NATIONAL BANK OF YALE
Court: Michigan Supreme Court
Jurisdiction: Michigan
Decision Date: 1917-06-01
Citations: 196 Mich. 660
Docket Number: Docket No. 82
Parties: DETROIT, BAY CITY & WESTERN RAILROAD CO. v. FIRST NATIONAL BANK OF YALE.
Judges: Moore, Steere, and Brooke, JJ., concurred with Kuhn, C. J.
Reporter: Michigan Reports
Volume: 196
Pages: 660–670

Head Matter:
DETROIT, BAY CITY & WESTERN RAILROAD CO. v. FIRST NATIONAL BANK OF YALE.
1. Eminent Domain — Damages—Benefits.
In the absence of statutory authority, benefits cannot offset damages in proceedings for condemnation of land for a railroad right of way.
2. Same — Jury—Questions of Fact and Law — How Determined.
In proceedings to condemn a railroad right of way the jury are judges of the law as well as of the facts. Fellows, Stone, Ostrander, and Bird, JJ., dissenting.
3. Same — View of Premises — Damages—Application of Benefits to Damages.
Where the jury, in proceedings to condemn a railroad right of way, viewed the premises, heard proof and argument of counsel, and allowed the respective owners substantial damages, defendants could not be heard to complain as to the theory of the application of benefits to damages adopted by the jury;
4. Same — Damages'—Mortgages—Impairment of Security.
In proceedings for the condemnation of a railroad right of way over mortgaged land, where the jury found that the loss of the land for the right of way did not impair the security of the mortgagee, an award of damages or compensation for such land tahen would not be warranted where the mortgagor had released such right of way to petitioner. Fellows, Stone, Ostrander, and Bird, JJ., dissenting.
Appeal from Sanilac Probate Court; Pearson, J.
Submitted January 10, 1917.
(Docket No. 82.)
Decided June 1, 1917.
Rehearing denied September 28, 1917.
Condemnation proceedings by the Detroit, Bay City & Western Railroad Company against the First National Bank of Yale and others to acquire a right of way. From an order confirming the award of the jury, defendants appeal.
Affirmed by a divided court.
Lincoln Avery, for appellants.
John C. Hewitt and Walter S. Wixson (C. F. Gates, of counsel), for appellee.
These proceedings were instituted in the probate court of Sanilac county under chapter 107, 3 How. Stat. (2d Ed.) § 6596 to and including § 6601 (2 Comp. Laws 1915, §§ 8252-8257), for the purpose of acquiring a right of way for the petitioner, which right of way crossed or intersected the'lands of the respondents. Prior to filing the petition negotiations were had between representatives of the petitioner and respondents with the end in view of securing the right 'of way from each of them. They were unable to agree upon the compensation, and the petition was filed as provided by law. A jury was chosen, viewed the premises, and heard the proofs and arguments of counsel. An award was returned by them, objections of counsel heard, and the award confirmed by the judge of probate. The amounts of the awards were as follows:' To John Wellman and Hattie Wellman, owners of 2.14 acres, and Otto H. Cain, mortgagee, $150; to William Wellman, owner of 3.7 acres, and Henry Patterson, mortgagee, $250; to Robert Sibbald, owner of 2.89 acres, $75; to Mary Ann Rolls, owner of 2.69 acres, $175; to Thomas Grimes, owner of 1.7 acres, and the estate of Charles Palmer, deceased, mortgagee, $50; to the First National Bank of Yale, Mich., and Charles G. Cork, interested in 2.87 acres of land as mortgagees, no dollars.
About three acres of land was taken from the Mitchell farm, upon which the First National Bank had a first mortgage lien. Mitchell had given a bonus note of $150, and subsequently gave a quitclaim deed to this right of way for a surrender of this note. The mortgage lien was not released, and the mortgagee received no part of the consideration, and was not a party to 'the agreement between Mitchell and petitioner.
Objection was made to the admissibility of certain evidence, and the court ruled that the jury passed upon the admissibility of the evidence, and that he had no power of keeping any evidence from going to the jury. The respondents appeal to this court, and no question of jurisdiction or of the necessity for taking the particular parcels of lands sought to be acquired under the petition is involved in this case. The questions for review presented by the record, as stated by appellants’counsel, are as follows: .. -
(1) Can a jury in a railroad condemnation proceeding set off against the value of land taken for a right of way the general benefits to be derived by the community as a whole?
(2) Can general benefits be used to "reduce the amount of damages to the remaining land after a right of way is taken?
(3) Can a jury refuse to determine ilae value of land taken, when the same is subject to a mortgage lien, the mortgagor having released the right of way subject to the mortgage?
(4) Is it within the province of a condemnation jury to pass on the sufficiency of the security to satisfy a mortgage indebtedness, and award nothing for mortgaged land taken for a right of way, if in its opinion sufficient land remains, subject to the lien, to satisfy the debt?

Opinion:
Kuhn, C. J.
(after stating the facts). Upon the hearing before the jury it was claimed by petitioner's counsel that the benefits should be taken into consideration in arriving at the compensation, and only such compensation should be allowed as the testimony showed the value of the several parcels were depreciated by the proposed improvements, and the respondents contended, and so argued before the jury, that no benefits, general or special, should be offset against the value of the land taken or against the damages to the remaining land. Regarding this contention, under the present state of the law in this State, in our opinion the respondents were correct. The statute under which these proceedings are brought. (section 21, art. 2, chap. 164, 2 Comp. Laws, § 6246, 2 Comp. Laws 1915, § 8255) nowhere refers to benefits, and no authority is vested in the jury to estimate the benefits and reduce the award for the value by taking therefrom the amount of the estimated benefits. In the case of Township of Custer v. Dawson, 178 Mich. 367 (144 N. W. 862), the statute (1 Comp. Laws 1915, § 4310) expressly provided that "the benefits accruing to owners of lands by reason of laying out or altering any highway shall be taken into consideration," which distinguishes that case from the one now under consideration. It is argued that "just compensation," as used in the Constitution (section 1, art. 13), means a compensation which would be just in regard to the railroad company as well as in regard to the individual, and if the jury should be satisfied that the individual would receive benefit from the taking of the property, it could not be said to be just compensation to give him full value. This question was recently considered by us in the case of Plantenga v. Railway Co., 190 Mich. 661 (157 N. W. 425), and I was of the opinion that the petitioner's contention was a just and reasonable construction of the language of the Constitution. The majority of my Brethren did not agree with me, and I therefore now defer to their judgment, and it must be said that the rule in this State is that, in the absence of authority given by statute, benefits cannot offset the damages and should not be considered in proceedings of this kind.
It was early decided, however, that the jury in proceedings such as these are judges of both the law and the facts. In Toledo, etc., R. Co. v. Dunlap, 47 Mich. 456 (11 N. W. 271), Justice Campbell, in commenting upon this statute, said:
"The judge formed no part of this special tribunal. The statute, indeed, allows the judge to 'attend said jury, to decide questions of law and administer oaths to witnesses.' Section 21, art. 2. But the same statute which allows this allows him to designate a circuit court commissioner for the same purpose, and also allows the jury to proceed without either. Whatever the language of this statute, literally construed, may mean, it is very clear that any such functions must, at most, be advisory. The jury will undoubtedly be regarded as accepting and doing what they permit to be done. But in all such cases the Constitution, as well as the principles of the common law, makes them judges of law and fact. Chamberlin v. Brown, 2 Doug. 120. Their conclusions are not based entirely on testimony. They are expected to use their own judgment and knowledge from a view of the premises, and their experience as freeholders, quite as much as the testimony of witnesses to matters of opinion. And while an appellate court is bound in such, cases to set aside proceedings which appear to be based on false principles, it cannot properly deal with rulings as if they were excepted to on a common-law trial or dispose of the controversy on merely technical notions. Chamberlin v. Brown, supra; Michigan Air-Line Railway v. Barnes, 44 Mich. 222 (6 N. W. 651)."
It was the claim of the petitioner, and the testimony tended to show, that the benefits exceeded the damages, and the several farms would be of greater value after the railroad was constructed across them than before the condemnation. The jury viewed the premises, heard the proofs, the argument of counsel and accepted the theory of respondents, rejecting the theory of the petitioner, and allowing the several owners of the fee substantial damages in each case. It is not to be presumed that the incompetent evidence which was introduced regarding benefits influenced their judgment any more than the same evidence would if it had come to them when acting merely as citizens buying and selling the land. See Detroit, etc., R. Co. v. Crane, 50 Mich. 182 (15 N. W. 73). We are therefore of the opinion that the respondents cannot be heard to complain as to the first and second propositions here advanced by them.
With reference to the other contentions of respondents' counsel, it must be borne in mind that the mortgagor had released the right of way to the petitioner, and that the mortgagee possessed no title to the land, and its interest in the real estate is simply to see that the value is not diminished. The jury found that the mortgagee's security was not impaired by the taking of the 2.87 acres of land of the mortgagor. Whether in arriving at this conclusion they recognized the claim as to benefits or decided for other reasons that the changed conditions did not impair the value of the mortgagee's security is conjectural. If the jury, after carefully viewing the premises and hearing the testimony, became satisfied that the value of the security in dollars and cents remained equal to what it was before, the mortgagee is in no respects injured, and the jury would not be warranted in awarding damages or compensation under such circumstances. We see no valid reasons for disturbing the award of the jury, and the proceedings are therefore affirmed, with costs to the petitioner.
Moore, Steere, and Brooke, JJ., concurred with Kuhn, C. J.