Court Opinion

ID: 9688730
Source: CourtListenerOpinion
Date Created: 2023-08-24 18:01:35.127421+00
Date Added: 2024-06-11T18:18:41.516675
License: Public Domain

On Rehearing
Justices STAKELY and GOODWYN concur in the dissenting opinion prepared by Justice LAWSON on original deliverance. Justice COLEMAN concurs in the result reached in that opinion.
It follows that rehearing is granted, judgment of reversal set aside, and judgment of the trial court affirmed.
Affirmed.
LAWSON, STAKELY, GOODWYN and COLEMAN, JJ., concur.
LIVINGSTON, C. J., and SIMPSON and MERRILL, JJ., dissent.
The following opinion was prepared by FOSTER, Supernumerary Justice, in response to application for rehearing and is adopted by LIVINGSTON, Chief Justice, and SIMPSON and MERRILL, Associate Justices, as their dissent.
As pointed out in the majority opinion, it is the value of the land when taken which fixes the amount of the “just compensation” on condemnation, together with the damage to the adjoining land. We referred to the case of Jones v. New Orleans and Selma R. Co., 70 Ala. 227. It is there said: “The land owner is entitled to the value of the land at the time of the taking and appropriation, whether the damages are assessed, as they should be, by condemnation proceedings, before the entry for the purpose of constructing" th'e road, or subsequently after there has been an actual taking and appropriation, without any proceedings, and without making payment of compensation”. In that case the condemnation proceeding had been resorted to 'after the *556actual appropriation, and building of the railroad. What is said must be referred to that status and reference to the instant status must be considered in that light. But the' Court made an exhaustive study of the question, both when the appropriation was actually taken before condemnation and when taken afterwards. What is said is not simply the assumption, without argument, of a highly controversial question as in Smith v. Jeffcoat, 196 Ala. 96, 71 So. 717. But in resolving the question directly involved, the Court felt called upon to and did analyze it from every angle. The Jones case is one of Justise Brickell’s masterpieces. The effort was to formulate a rule which would award compensation which was “just”, as the Constitution requires. The Court laid down a formula applicable to the situation there involved and has applied to it the one here involved in the language quoted above for the purpose of ascertaining what would be “just” to the land owner. The petitioner in the Jones case had entered upon the land as a trespasser and made valuable improvements. Doing so as a trespasser, those improvements were thought to belong to the land owner and on condemnation later conducted that petitioner should pay for them. But the Court said that petitioner, although a trespasser, was exercising the right of eminent domain and in doing so was required to do no more than pay what was “just”. The value in all instances was fixed at the time of “taking and appropriating”. That is generally stated to be the proper formula. Birmingham-Trussville Iron Co. v. Allied Engineers, 225 Ala. 522, (5), 144 So. 1; Southern Ry. Co. v. Cowan, 129 Ala. 577, 29 So. 985; Olson v. United States, 292 U.S. 246, 54 S.Ct. 704, 78 L.Ed. 1236; Jacobs v. United States, 290 U.S. 13, 54 S.Ct. 26, 78 L.Ed. 142; Brooks-Scanlon Corp. v. United States, 265 U.S. 106, 44 S.Ct. 471, 68 L.Ed. 934; Messer v. United States, 5 Cir., 157 F.2d 793; 29 C.J. S. Eminent Domain § 185, pp. 1068-1069.
Under our law when proceedings are conducted before an actual appropriation, the amount of damages and just compensation is necessarily at a time before there is such an entry upon the land. This may occur as much as six months after the order of condemnation is made. — Section 25, Title 19, Code. But the value reported by the commissioners on which the order is made is as of that time, although the actual appropriation occurs later. The taking is theoretically accomplished as of the time of fixing those values by the commissioners, and that becomes the date of taking fpr that purpose because petitioner thereby acquires the right to do so on a value fixed on that day. The issue is to be tried before the commissioners and decided by them as of the date of their report. If an appeal is taken to the circuit court, it is triable de novo■ — section 17, Title 19, Code — but the issue is the same. 29 C.J.S. Eminent Domain § 185, p. 1073, notes 51-52. It is not changed by the fact that petitioner may have taken actual possession pending the appeal or that there has occurred either an increase or decrease in the value and physical condition of the property from that existing at the time of the trial before the commissioners.
In this case the land owner had l-ightful possession of the land at the time of the fire. Petitioner had nothing to do with its possession at that time and had no right to its possession and had no interest in the land, and had not taken it either actually or theoretically.
Appellee seeks to apply to the situation certain principles of law said to govern as between a vendor and purchaser before there is a deed to the purchaser. He declares that there is a principle that where there is a relationship of vendor and purchaser and there is fire insurance covering the property on a contract of insurance with the vendor “under the rule that the loss falls on the purchaser, he is entitled to credit for the insurance money received by the vendor”. We cannot follow the claim that such principle is here applicable. Under those circumstances the vendor holds the title merely as security for the purchase money owing by the purchaser. The purchaser is the equitable owner of the property and owes a debt to the vendor, and has become bound to pay the stipulated sum.
The relation of condemnor and condemnee does not have the incidents of vendor and purchaser before a conveyance is made. The condemnor is not obligated to pay the amount of the assessment before he elects to do so.
*557It is stated that • “eminent domain is in the nature of a forced sale to the state”. 29 C.J.S. Eminent Domain § 17, p. 800, note 42; Beeland Wholesale Co. v. Kaufman, 234 Ala. 249(2), 174 So. 516; Jackson v. State of New York, 213 N.Y. 34, 106 N.E. 758, L.R.A.1915D, 492.
Although it is safe to assert that a completed condemnation by payment of the fixed award is in effect a forced sale, all the steps leading up to it do not parallel those conducted by negotiation. We find no authority which asserts that they do parallel.
Appellee elsewhere in brief seeks to apply the principle of an option which more nearly resembles the instant situation. But it does not become an option until the condemnor has the right to accept something offered to him. In a condemnation there is nothing offered to him until the commissioners make their report and the court orders the condemnation on the condition prescribed by statute: that is, upon payment in six months of the amount of the award. So here, when the option was submitted to the county the fire had occurred and the submission was to buy the property in its then condition.
The question here involved is controlled by the statute of the respective states. It is indicated in Jackson v. State of New York, supra, cited by appellee, that the first step was an “appropriation” of the property by the state for some public purpose or the use of a public enterprise. Thereupon the board of claims should find the value of the land including the buildings. It did so and found the value of fixtures in the buildings, machinery, etc. The state claimed the right to reject the fixtures and refused to pay for them. The Court of Appeals observed that this was an enforced sale and the state stands toward the owner as buyer toward seller. The court did not sustain the claim of the state and held that the rights of the parties became fixed at the time of appropriation. The title to the land passed upon notice of appropriation and this included the fixtures which also passed and must therefore be paid for.
Applying that theory here, it would be that the condemnor must pay for the land in its .condition when. th,e. title passes. The New York statute seems to differ from ours to the extent that it is without much value to us in this case.
In application of Westchester County, 204 Misc. 1031, 127 N.Y.S.2d 24, 33, the court made it clear that under a different statute' the condemnor must pay the value of the land at the time of taking it which was (theoretically) when the title passed. The condemnation was begun February 7, 1950, notice was given February 8, 1950, and title passed under the condemnation July 12, 1951. The important question was whether February 7, 1950, or July 12, 1951 was the date for measuring the value. The court observed:
“The court has further concluded that such difference in value and such damages, if any, are to be determined as of the time of vesting of title to the subject parcel in the County, to wit, as of July 12, 1951. The institution of the proceedings and the filing of the lis pendens in February, 1950, merely put the respondents on notice that the County was about to take a portion of their premises. The respondents presumably then knew that the law would require the payment by the County of the value of the subject parcel and consequential damages as of the time title passed. If the County unduly delayed the taking of title, the respondents had the right to compel it to proceed or have the proceedings dismissed and the lis pendens cancelled. There is generally some lapse of time between the institution of a condemnation proceeding and the taking of title by the condemnor, but there is no basis for an award for delay in appropriation. Such is the general rule in this state and the parties to condemnation proceedings are bound thereby, and must act accordingly.
“It is the well recognized general rule in the law of eminent domain that, in the absence of special statutory provisions otherwise declaring, the date of the appropriation or expropriation is the value or damage date. In other words, the date on which title passes or injury is done is the date when the *558money must or should be paid and the amount thereof determined. See 29 C.J.S. Eminent Domain § 185, page 1068; Parks v. City of Boston, 15 Pick., Mass., 198; Matter of Mayor, etc., of City of New York, 40 App.Div. 281, 284, 58 N.Y.S. 58, 60; In re Simmons [Ashokan Reservoir, Sec. No. 7], 130 App.Div. 356, 359, 114 N.Y.S. 575, 577-578, affirmed 195 N.Y. 573, 88 N.E. 1132, affirmed sub nom McGovern v. City of New York, 229 U.S. 363, 33 S.Ct. 876, 57 L.Ed. 1228; In re Board of Water Supply of City of New York, 277 N.Y. 452, 457, 14 N.E.2d 789, 791; In re City of New York, West Tenth St. Borough of Brooklyn, 267 N.Y. 212, 220, 196 N.E. 30, 32, 98 A.L.R. 634; In re City of New York (East River Drive), 264 App.Div. 555, 560, 35 N.Y.S.2d 990, 996, affirmed 298 N.Y. 843, 84 N.E.2d 148.
“For instance, it was said by Chief Justice Shaw in an early Massachusetts case (Parks v. City of Boston, 15 Pick, at page 208, supra) :
“ ‘The true rule would be, as in the case of other purchases, that the price is due and ought to be paid, at the moment the purchase is made, when credit is not specially agreed on. And if a pie-powder court could be called on the instant and on the spot, the true rule of justice for the public would be, to pay the compensation with one hand, whilst they apply the axe with the other; and this rule is departed from only because some time is necessary, by the forms of law to conduct the inquiry; and this delay must be compensated by interest. But in other respects the damages must be appraised upon the same rule as they would have been on the day of the taking.’
“The constitutional requirement of just compensation is said to be met by the payment of the fair market value of the property taken as of the date of the taking. * *. * It is said to be a well established principle that a person whose property is taken by virtue of the power of .eminent domain ‘is entitled to be paid only the value of the property, considering it in its condition and situation at the time it is taken.’ ■I* <]• ¥
“The decisions having to do with a proceeding under the Condemnation Law of this state, or under a special statute containing provisions for the vesting of title upon payment, may be said to recognize and to be in accordance with general rules above mentioned. In such a proceeding, the last date upon which any intelligent appraisal of what will be taken can be made is the date of the report or award by the commissioners. This is always some time before the title date but it is the nearest to the title date that the commissioners can approach without stultification, and accordingly, is held to be the value date on which awards under the laws indicated must be made. * * *
“A recognized exception to the general rule exists where the condemnor, under legal authorization, enters into possession of the realty before he takes title. Under such circumstances, the value date is moved back to the date of compliance with the legal conditions of possession before title. * * * The same kind of reasoning has been applied to cases where a trespass amounting to an exclusive appropriation has been committed innocently by a legal entity with a power of condemnation. * * * In the case at bar, however, the County did not enter upon or take possession of the subject parcel prior to acquiring title, and, in fact, was not entitled to possession until the entry of the judgment of condemnation.
"A review of the decisions leads to the conchision that the rule generally to be applied in condemnation proceedings in this state is that the title vesting date or possession date, whichever is the earlier, shall be regarded as the value fixing date. Special provisions by statute may, of course, render such rule inapplicable in a particular case. The special statute applying to the proceeding at bar, Westchester County Administrative Code, *559does not, however, contain any provision inconsistent with the application of the general rule.” (Italics supplied.)
Appellee cites the case of Heidisch v. Globe and Republic Ins. Co., 368 Pa. 602, 84 A.2d 566, 29 A.L.R.2d 884, as holding contrary to the majority opinion. That was a suit by the land owner against an insurer of property against fire. The question posed at the outset in the opinion is: “Does the owner of property which has been condemned by eminent domain but title to which has not as yet passed to the County have an insurable interest in the property entitling him to compensation under a contract of insurance upon the loss of the building by fire ?” The following were the facts: Viewers were appointed and on August 19, 1949 an award was made by the viewers. An appeal was taken. A consent verdict was rendered January 11, 1950, which was paid in full ten days later. In the meantime, on August 28, 1949, Globe and Republic Insurance Company (defendant) issued its policy of insurance to plaintiffs in the sum of $6,000. Thereafter on September 28, 1949 the building was totally destroyed by fire. The opinion stated that under the statute (named) title to the property remained in plaintiffs until the county paid the amount of the consent verdict on January 21, 1950. The company claimed that plaintiffs’ title is merely to secure payment of the award, and they had suffered no economic loss and therefore cannot recover on the insurance. It will be observed that the viewers made their report on August 19, 1949. An appeal was taken, and pending that appeal the fire occurred. The county had not at that time paid the amount of the viewers’ award and had not taken possession. After the fire loss, a consent verdict was rendered. It was said that the situation was analogous to where the insured enters into an agreement to sell the premises and after signing the agreement, but prior to passage of title, a fire occurs. It was noted that the insured holds title as security for the purchase price, and the vendor possesses an insurable interest (such is our law — see Robinson v. Wade, 220 Ala. 693, 127 So. 170); also that the vendor is the trustee for the purchaser of the insurance fund. But the insurer is liable to pay for the loss to the seller. By the time of the trial of the suit in that case the county had paid the full amount of the award which included the value of the house which had burned. The analogy is not exact, because the condemnor is not obligated as a purchaser.
The difference between Heidisch v. Globe and Republic Ins. Co., supra, and the instant case is in the facts, not the principle of law. There the fire occurred after the viewers made their award and pending the appeal, No possession had been taken pending the appeal. The court did not see fit to discuss a situation where, as in our case, the fire occurred before the viewers made their report because it was not involved. Our view is consistent with the holding that after the viewers (or commissioners) make their award, the subsequent proceedings as to value must be based on the condition of the property at the time of the award by them. The probate court must accept that as the proper amount and order the condemnation accordingly. Section 16, Title 19, Code. If the owner had insurance the proceeds of it from a fire occurring afterwards would be held in trust for the condemnor if he saw fit to pay the award. But we think that if the fire occurred before the commissioners viewed the property and made their award, the proceeds of the insurance held by the owner, if any, would be for his own benefit. We know of ■ no authority, except Smith v. Jeff coat, supra, which conflicts with that statement when no statute causes a different result.
It is our view that the application for rehearing should be overruled.