Court Opinion

ID: 9452974
Source: CourtListenerOpinion
Date Created: 2023-08-04 17:58:32.132402+00
Date Added: 2024-06-11T17:33:26.582082
License: Public Domain

BYRNE, District Judge
(concurring in part, dissenting in part):
I concur with the Court in the portion of the opinion dealing with the appeal of PUD. I am unable, however, to concur in the majority's views as to Seattle's cross-appeal.
It is apparently the view of the majority that reversal on Seattle’s cross-appeal would, in effect, overrule United States v. Central Stockholders Corp., 9 Cir., 52 F.2d 322, but as I view the two cases, they are clearly distinguishable.
The Central Stockholders ease involved a condemnation proceeding in the state court where lower riparians received condemnation grants based on California water law, just as Grand River Dam Authority v. Grand-Hydro, 335 U.S. 359, 69 S.Ct. 114, 93 L.Ed. 64, involved a condemnation proceeding in the state courts of Oklahoma. In both cases it was held that an FPC license holder, proceeding in a state eminent domain action, could not claim the benefit of the dominant navigation servitude of the United States. In Grand Hydro, the Grand River Dam Authority, a public agency of the State of Oklahoma, sought to condemn lands owned by Grand Hydro, a private utility. The Authority, while it held a license from the Federal Power *675Commission to build its project, chose to condemn the lands in the state courts under state law, rather than to exercise its Section 21 powers. The Oklahoma Supreme Court held, as a matter of state law, power site valuation had to be paid. The United States Supreme Court affirmed on the ground that nothing in the Federal Power Act could be said to supersede the state law in this situation. The Court further stated:
“If either the United States, or its licensees as such, were seeking to acquire this land under the Federal Power Act, it might face different considerations from those stated above. The United States enjoys special rights and power in relation to navigable streams and also streams which affect interstate commerce * * * we express no opinion upon what would be the appropriate measure of value in a condemnation action brought by .the United States or by one of its licensees in reliance upon rights derived under the Federal Power Act.” (335 U.S. 359, 373, 69 S.Ct. at 121) (Emphasis supplied).
The case now before us, unlike Grand-Hydro and Central Stockholders, involves a condemnation action brought by a licensee of the United States “in reliance upon rights derived under the Federal Power Act”. Judge Merrill, writing for the majority, concedes that no value at all should be assigned to the shorelands or to the power-site attributes of the taken uplands if the United States, itself, were the condemnor. Why the distinction between the United States and a licensee of the United States? The Supreme Court makes no such distinction in Grand-Hydro. The distinction made by the Supreme Court is between actions brought in state courts under state law and actions brought “in reliance upon rights under the Federal Power Act”.
Surely Congress did not intend that added heavy initial construction costs should burden the users of the power merely because a licensee undertook the construction rather than the federal government. This is particularly significant since Congress retains the right to take over a licensed project at the expiration of the 50 year license by paying the net investment to the licensee and, thus, has a direct interest in keeping construction costs to a minimum (See Sections 6,10 and 14 of the Act.)
In my opinion, when a licensee chooses to exert the powers granted to it by instituting an action pursuant to Section 21 of the Act, it is entitled to the concomitants of that power including the benefit of the federal navigation servitude.
Upon Seattle’s cross-appeal, I would reverse.