Court Opinion

ID: 9700398
Source: CourtListenerOpinion
Date Created: 2023-08-25 21:26:03.645622+00
Date Added: 2024-06-11T18:21:08.554692
License: Public Domain

WHITAKER, Judge
(dissenting).
In Brooks-Scanlon Corporation v. United States, 265 U.S. 106, 44 S.Ct. 471, 475, 68 L.Ed. 934, it was said that just compensation is “the sum that would in all probability result from fair negotiations between an owner who is willing to sell and a purchaser who desires to buy.” This is repeated in substance in Standard Oil Co. of New Jersey v. Southern Pacific Co., 268 U.S. 146, 45 S.Ct. 465, 69 L.Ed. 890, and in United States v. General Motors Corporation, 323 U.S. 373, 65 S.Ct. 357, 156 A.L.R. 390.
It is also defined in these cases as “the sum which will put it (the owner) in as good a position pecuniarily as it would have been in if its property had not been taken.”
The sense of both of these definitions has been put succinctly in these words, quoted in Standard Oil Co. of New Jersey v. Southern Pacific Co., supra [268 U.S. 146, 45 S.Ct. 467], “The worth of a thing is the price it will bring.”
Now, as I understand it, it is said that by the rule stated in these definitions $3.08 is just compensation for the silk because that is all the plaintiffs could have gotten for it had the defendant not taken it. That is true, but it is true only because the defendant itself so decreed; it prohibited the sale of the silk to anyone other than itself or its alter ego, and it had fixed this as the highest price that could be paid for it. Except for this, the proof is abundant that a much higher price could have been obtained for it.
Now, no one doubts that the Government has the war power to fix prices and to punish people who sell at higher prices, but it does not follow that this is the price it must pay when it takes property. This is the price it must pay only if this is “just compensation”; and “just compensation” has been defined as the amount that could have been obtained for it as the result of fair negotiations with one who desired to buy. It is not the amount a person is forced to pay or forced to take. $3.08 is the price plaintiffs were forced to take. Had they been free to get the best price they could on an open market they *141would have been able to get eight or ten dollars or more. According to the rule stated in the above-mentioned authorities, plaintiffs are entitled to recover whatever sum they could have gotten on the open market.
But I do not think this rule is without limitation. The constitution requires “just compensation.” A price of eight dollars is four times the average price at which silk had sold in the previous ten years and twice the highest price at which it had sold in this period and about seven times the lowest price it had sold for. Such a price seems to me to exceed “just compensation.”
It is an inflated price, one brought about by abnormal conditions. It has no relation to the intrinsic worth of the article. It is one that will continue only so long as these abnormal conditions continue.
The country was at war and it needed plaintiffs’ silk to carry on the war. The 100 bales plaintiffs had and 440 other bales were all the silk in the country. If plaintiffs had been entitled to haggle for a price they could have gotten almost anything they demanded but I do not believe they had the constitutional right to thus take advantage of their country’s extremity and to demand of it an unconscionable price merely because they could get it. This is not the “just compensation” required by the constitution. Had plaintiffs done so, their countrymen would hardly point to either of them and say, “Behold a just and an upright man.”
In times of war, just compensation is not the amount a profiteer would charge and could get, or the price that could be obtained on the “black market.” But, on the other hand, I do think that plaintiffs were entitled to what it is reasonable to suppose they would have realized on an open market in normal times.
In December 1939 when this country was at peace the price of silk was $3.93 a pound. This is the highest average monthly price at which it had sold in the ten years immediately preceding the requisition. I think plaintiffs are entitled to this much, since this is not exorbitant and since they could have gotten much more than this except for the Government’s restrictions.
At the time further sales were prohibited by the Government the market had risen to $3.65 a pound. This was not an exorbitant price. On the one hand, it was higher than silk had sold for in the last ten years, except during the months of November and December 1939; and, on the other hand, it was lower than it had sold for in 1928 and 1929 and other prior years. From July 1928 to June 1929 it had sold at prices ranging from $4.86 to $5.30 and from July 1929 to June 1930 it had sold at prices ranging from $3.56 to $5.20.
Since the last free sale of silk was at the price of $3.65 and since this was not an exorbitant price, I can see no warrant for denying plaintiffs’ recovery of at least this much. There can be no doubt that they would have been able to get this much as the result of fair negotiations with a buyer desiring to buy except for the Government’s restrictions. They are entitled to at least this much, since this is not an exorbitant price.
The price fixed by the Office of Price Administration is, of course, not controlling in arriving at just compensation. We are not told upon what basis it was fixed or what factors were taken into consideration in arriving at it. It appears to be the highest yearly average price at which silk had sold in the last ten years. I think plaintiffs are entitled to more than the average yearly price, since they could have gotten much more on the open market. I think they are entitled to the highest price at which silk had sold on normal markets in recent years. This was $3.93.
I would add a finding to show these prices and I would give judgment on the basis of $3.93 a pound, or not less than $3.65 in any event.
MADDEN, Judge, took no part in the decision of this case.