Court Opinion

ID: 9466009
Source: CourtListenerOpinion
Date Created: 2023-08-05 01:02:52.378445+00
Date Added: 2024-06-11T17:39:29.673269
License: Public Domain

K. K. HALL, Circuit Judge:
The single issue presented in this appeal is the validity of the United States’ title to property taken in a condemnation proceeding, where no actual notice of the proceedings was sent to the property’s owner although his identity could have been discovered by a diligent title search. We hold that title passes when the government has properly invoked the in rem jurisdiction of *296the condemnation court, and that no action can thereafter be maintained under 28 U.S.C. § 2409a to question that title.
Arthur J. Fulcher brought this action under § 2409a claiming present title to certain property now a part of the Cape Hatteras National Seashore Area in Dare County, North Carolina. The United States moved to dismiss, contending that title passed as a matter of law once the in rem judgment on its condemnation was entered under 40 U.S.C. § 258a.1 The district court dismissed the action noting that, at best, plaintiff has a right of compensation which is recognized exclusively under the Tucker Act, 28 U.S.C. §§ 1346 and 1491.2 We agree and affirm.
The property in question was the subject of condemnation proceedings brought by the government in 1959. In those proceedings a complaint and a Declaration of Taking were filed by the government. § 258a. Notice of condemnation was published in a. local newspaper. Actual notice was sent to Stanley Wahab who, as a title holder of record, was believed to be the true owner of the tract now claimed by Fulcher. Judgment on the Declaration of Taking was entered, and then judgment embracing title to the tract here in question was entered stating that title had previously been vested in Wahab. Compensation in the amount of $18,825.40 was paid to Wahab.
In 1977, eighteen years later, Fulcher brought this action under § 2409a. In essence, he contends that the condemnation court’s in rem jurisdiction was vitiated as a result of the government’s failure to give actual notice to his ancestors, whose identities could have been discovered by a reasonably diligent title search. He claims that such a title search would have revealed that the subject property was deeded to his ancestors ten years before their grantor made a second deed to Wahab. Since his ancestors’ deed was recorded before Wahab’s, North Carolina law would hold them to be the owners at the time of condemnation.
In support of his complaint, Fulcher relies upon our holding in United States v. Chatham, 323 F.2d 95 (4th Cir. 1963). His reliance is misplaced. In Chatham, the condemnation court’s jurisdiction was held lacking due to “outrageously inexcusable” conduct by the government. Id. at 99. Possession was not assumed for seven years after condemnation and no service of process was executed other than publication notice, which we found to be “not only unenlightening but positively misleading.” Id. at 100. Given such unusual conduct, we concluded that jurisdiction over the property had not been invoked, and we emphasized that the owners could have been identified easily — most notably without resort to the complexities of state property law and title searches. At the time of condemnation the owners had previously lived on the land for more than 25 years and were commonly known in the area as the owners in fact. One of the owners’ sons resided two miles from the property and collected rent from the tenant in possession. The tenant in possession worked the disputed property as part of his fields and pasture-lands and, if asked but a single, simple question, would have readily identified the owners as his landlords. We also acknowledged that the owners could have been identified from their record title and from property taxation lists.
We think Chatham is wholly distinguishable from plaintiff’s case. See United States v. Haddon, 550 F.2d 677 (1st Cir. 1977). Fulcher does not base his claim of title upon an alleged insufficiency of publication notice or notice posted on the property. He does not contend that his ancestors’ interest was easily discoverable by a view of the property. He only contends that it appeared as a matter of public record and *297would have been discovered by a diligent title search, which is required in federal condemnation suits by Rule 71A of the Federal Rules of Civil Procedure. Assuming the facts to be true as we must do on a motion to dismiss, we think his attack on the condemnation proceedings falls short.
The purpose of condemnation proceedings is to convert the private use of property into some public use for the public good. A necessary consequence of this conversion is the extinguishment of private rights in the property. Norman Lumber Co. v. United States, 223 F.2d 868, 870 (4th Cir.), cert. denied 350 U.S. 902, 76 S.Ct. 181, 100 L.Ed. 792 (1955). The power of government to extinguish private rights is an attribute of sovereignty and as such is superior to and independent of private rights of property. However, the sovereign right is limited by the Fifth Amendment’s requirement of due process and just compensation. Albert Hanson Lumber Co. v. United States, 261 U.S. 581, 587, 43 S.Ct. 442, 67 L.Ed. 809 (1923).
In Schroeder v. City of New York, 371 U.S. 208, 83 S.Ct. 279, 9 L.Ed.2d 255 (1962), the Supreme Court held that due process was not satisfied by publication notice alone where no signs were posted on the property and no personal notice was sent to the owner, although her name was readily ascertainable from both deed records and tax rolls. The Supreme Court never questioned the condemning body’s title to the property, but rather limited its discussion to the minimum due process requirements necessary to foreclose an individual’s right to be heard on a claim of compensation for taking. See United States v. Chatham, 323 F.2d at 99. Implicit in the Court’s careful analysis was its acceptance that condemnation proceedings are proceedings against property and, as such, are an exception to the general rule that no persons are bound by a judgment except those who are parties to the proceeding and have had an opportunity to be heard. See Dupasseur v. Rochereau, 88 U.S. (21 Wall.) 130, 22 L.Ed. 588, 591 (1875). In an in rem proceeding, “all persons having any interest in the thing are deemed parties, and have the right to intervene pro interesse suo; and if after the lawful publications of notice have been made, they fail to do so, they are considered as having acquiesced in the exercise of jurisdiction.” Id.
A condemnation proceeding “is not the taking of rights of designated persons, but the taking of the property itself,” and “[w]hen property is condemned, the amount paid for it stands in the place of the property and represents all interests in the property acquired.” Eagle Lake Improvement Co. v. United States, 160 F.2d 182, 184 (5th Cir. 1947) (citation and emphasis omitted.) In the recent case of Shaffer v. Heitner, 433 U.S. 186, 206, 97 S.Ct. 2569, 53 L.Ed.2d 683 (1977), the Supreme Court reaffirmed its holding in Schroeder v. City of New York, supra, and cited with approval to an annotation discussing that case, which begins,
As to the necessity of notice, as a matter of due process, in proceedings for the condemnation of real property, a distinction has been made between the taking of the property and the determination of just compensation. Where the taking of property is for a public use, the due process clause of the Fourteenth Amendment does not require that the necessity and expediency of the taking be determined upon notice and hearing. However, with respect to the compensation for the taking, due process requires that the owner be given reasonable notice of, and an opportunity to be heard in, the pending proceedings, (footnote omitted)
89 A.L.R.2d 1398, 1405.
Therefore, we see no reason to look behind the clear terms of § 258a which provide that title passes to the government upon its filing of a declaration of taking and deposit of estimated compensation in the registry of court.3 We think the *298government’s title becomes indefeasible upon the judgment of taking and payment of compensation to the apparent record owner, leaving the true owner only a claim for money damages. See Catlin v. United States, 324 U.S. 229, 241-43, 65 S.Ct. 631, 89 L.Ed. 911 (1945); Norman Lumber Company v. United States, 223 F.2d at 870-71.
In this case, the substance of plaintiff’s complaint is that payment was made to the wrong party. If so, then plaintiff may pursue a remedy against the United States for money damages under the Tucker Act but may not pursue a collateral attack under § 2409a upon the final judgment of a condemnation court based solely upon deficiencies in actual notice to owners who are unknown. United States v. Ivie, 163 F.Supp. 138, 143 (N.D.Ga.1957). See United States v. Chatham, 323 F.2d at 100, n. 5; United States v. Haddon, 550 F.2d at 680-681. Finally, the issue of whether a condemning body is charged with knowledge of what a diligent title search would reveal, requiring that actual notice be given before compensation is foreclosed, is a matter properly addressed in federal court only under the Tucker Act in the context of the owner’s right to money compensation. See Schroeder v. City of New York, supra; Shaffer v. Heitner, supra.
The judgment of the district court dismissing plaintiff’s quiet title action is

AFFIRMED.

. The government also raised the affirmative defense of the twelve-year limitation period of § 2409a, but no ruling was made by the district court on this defense.

. The statute creating an action to quiet title expressly excludes from its scope all bare claims for compensation which “may be or could have been brought” under §§ 1346 or 1491 of the Tucker Act. § 2409a(a). We express no opinion regarding plaintiffs rights under the Tucker Act.

. In several cases not involving § 258a it has been held that due process prevents title from passing until payment is received by owners who were known and represented in the proceedings. Cherokee Nation v. Southern Kansas Ry. Co., 135 U.S. 641, 659-60, 10 S.Ct. 965, 34 L.Ed. 295 (1890); Albert Hanson Lumber Co. v. United States, 261 U.S. 581 at 587, 43 *298S.Ct. 442, 67 L.Ed. 809. These cases do not address our issue of the rights of unknown owners when in rem jurisdiction supports a final judgment of condemnation. See generally Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306, 314-17, 70 S.Ct. 652, 94 L.Ed. 865 (1950); Shaffer v. Heitner, 433 U.S. at 207-08, 97 S.Ct. 2569.