Court Opinion

ID: 9570274
Source: CourtListenerOpinion
Date Created: 2023-08-21 20:21:54.683047+00
Date Added: 2024-06-11T12:05:26.694598
License: Public Domain

On Motion for Rehearing.
On motion for rehearing, Shell makes essentially the same arguments it made before, all of which we thoroughly considered and found without merit.
Shell Oil contends, in another vein, that Simmerman had no compensable leasehold interest because the lease provided that the lease could be declared terminated in the event of condemnation, and was so terminated by Shell. 2 Nichols on Eminent Domain, § 5.06 [2] at pp. 5-113 — 5-114, is quoted for authority that “[u]nder such a [condemnation clause in a] lease the tenant has no estate or interest in the property remaining... to sustain a claim for compensation____” We do not see much logic in Mr. Nichols’ statement. A leasehold is a compensable interest just as is a freehold (Allen v. Hall County, 156 Ga. App. 629, 632 (275 SE2d 713)). A taking by eminent domain by *389definition ends the property interests of all owners, feeholders and leaseholders alike and that very fact is the reason that the constitution requires payment of just and adequate compensation. Shell would be dismayed if, by Mr. Nichols’ logic, we held that since a condemnation leaves a feeholder with “no estate or interest in the property,” there is nothing to sustain a feeholder’s claim for compensation.
We think that obviously a lessor, for his protection, may put in his lease a clause providing that as between the parties the lease is terminated in the event of condemnation, but this does not control Georgia law on the subject of compensability from the condemnor. The condemnation of a leasehold is a matter between the condemnor and the lessee. The lessor by definition has no part in the leasehold value (Allen, supra, p. 632), and has no right to decree that the lessee has no leasehold compensation rights from the condemnor by virtue of the fact of condemnation itself. That is “Catch-22” illogic of an extreme degree.
Contrary to Mr. Nichols’ suggestion that the lessor can by terminating the lease upon a condemnation dissolve the leaseholder’s rights against the condemnor, we have distinctly held in Georgia that the termination of a leasehold interest by condemnation is a compensable taking. Waters v. DeKalb County, 208 Ga. 741 (69 SE2d 274); Ga. Power Co. v. Brooks, 207 Ga. 406 (62 SE2d 183); Allen, supra. This compensability is obviously figured on the basis of what the leaseholder has lost, using all relevant factors including the unique value of the leasehold to the lessee. Heilman v. Dept. of Transp., 162 Ga. App. 547 (290 SE2d 189); DeKalb County v. Fulton Nat. Bank, 156 Ga. App. 253 (274 SE2d 649).
DOT in its motion for rehearing requests a holding “as to Simmerman’s proper future role in this litigation.” We agree that some clarification is appropriate here. It should be obvious from what we held that Shell, having chosen to accept as just and adequate compensation the sum of $369,565, for property that includes a leasehold, must share the proceeds with Simmerman according to the portion of it that represents his leasehold value. Since Simmerman assigned away his right to collect anything at all from the condemnor, Shell may of course accept as just and adequate what is now paid into the registry, whether or not this valuation included the leasehold encumbrance. Simmerman’s action to prove that a portion of this represents his leasehold interest, will be against Shell. Simmerman has no right of action against DOT, now or in the future, for this is what he assigned to Shell. In fact, since he assigned his right to make any claim at all against the condemnor, he has no right to claim that what Shell receives is not just and adequate; he only has the right to *390receive a portion of whatever Shell collects. If Shell did not collect enough to satisfy itself fully for its fee interest and pay Simmerman his portion as well, that is Shell’s disappointment; for under the assignment, Simmerman is entitled to a portion of the property award representing his encumbering leasehold interest even, theoretically, if it comprised the entire amount Shell agreed to accept from the condemnor. DOT does not pay Simmerman; DOT pays Shell and Shell must pay to Simmerman his lawful share. We held in the decision, “we will leave it to the jury to determine if the leasehold in this particular property had value, and how much.” The proceeding obviously referred to would be the proceeding between Shell and Simmerman. All of this should have been evident from the import of the decision.

Rehearing denied.