author: HULEN, District Judge.

text:
    UNITED STATES v. CERTAIN LANDS IN ST. CHARLES COUNTY, MO., KNOWN AS WELDON SPRING AREA.
    Nos. 763, 766, 779, 783, 786, 789, 790, 793, 803, 806, 813, 819.
    District Court, E. D. Missouri, E. D.
    May 5, 1945.
    Harry C. Blanton, U. S. Atty., of Sikeston, Mo., M. Walker Cooper, Sp. Asst. U. S. Atty., of St. Louis, Mo., Russell Vandivort, Asst. U. S. Atty., of St. Louis, Mo. (J. Edward Williams, Acting Head, Lands Division, and Victor C. McCrea, Atty., Department of Justice, both of Washington, D. C, of counsel), for plaintiff.

      William R. Gentry, Samuel M. Watson, and Oliver T. Johnson, all of St. Louis, Mo., Webster Karrenbrock, of St. Charles, Mo., William H. Allen, Cox & Blair, and Redick O’Bryan, all of St. Louis, Mo., William Waye, Jr., of St. Charles, Mo., Roscoe Anderson, W. R. Gilbert, Harry Richards, and Igoe, Carroll, Keefe & Co-burn, all of St. Louis, Mo., William J. Becker, and E. Evan Hughes, both of Clayton, Mo., and Richard D. Shewmaker, of St. Louis, Mo., for various landowners defendants.
    Walter R. Brown, of St Louis, Mo., for Federal Farm Mortgage Corporation, C. S. Hale, trustee, intervening defendant.
    Blatchford Downing and Caldwell, Downing, Noble & Garrity, all of Kansas City, Mo., for R. Newton McDowell, amicus curtee.
   HULEN, District Judge.

These cases are now before this Court on the question whether the defendant landowners shall be paid interest, raised by motion on the part of plaintiff for judgment in condemnation of defendants’ land, and judgment for the defendants for the sum agreed to in option contracts between plaintiff and defendants, but without interest, and counter motions by defendants substantially like plaintiff’s motion, but asking for interest on the sum remaining undeposited on the contract price, since date of taking by the plaintiff. Like motions appear in each case and are now ruled.

The above numbered cases are part of many cases growing out of the acquiring by the Government of land at Weldon Springs for war purposes. Without going into details of the history of the acquiring of the land by the Government, suffice it for the purpose of the present question to recite that in the -cases now be'fore this Court, the landowners and the Government entered into individual, but like, option contracts, for the sale of the land to the Government in 1940. The option contracts were accepted by the Government and possession of the lands thereby taken by the Government. Subsequently the Government charged that the option contracts were illegal and sought to repudiate the contracts which had not been closed and to acquire the land by the usual condemnation proceedings. In such cases, including those now before the Court, the plaintiff filed a declaration of taking in conventional form and deposited a sum with the Clerk of the Court, based upon an estimate of value. This estimate was less than the contract prices. It is interest on this deficit that is here involved. This move by plaintiff was opposed by the landowners. There seems to have been acquiescence if not agreement that the issue thus created would be tried out in three cases, one before each Court of this division. After success for the position of each party in the lower courts, a decision of the Supreme Court settled the controversy in favor of the landowners, and sustained the validity of the option agreements. Muschany et al. v. United States, 65 S.Ct. 442, 445, 89 L.Ed. —.

The litigants are not now in accord in their interpretation of the decision of the Supreme Court. Learned counsel for the landowners insist that the opinion of the Supreme Court supports their claim for interest, and equally learned counsel for the Government insist with equal earnestness that the decision of the Supreme Court supports their position that no interest shall be paid. The question of interest was not directly before the Supreme Court, but it may serve some purpose in determining what effect that decision has on the present question, to examine the issues.

Following the act of the Government in serving notice of repudiation of the option agreements, it proceeded to initiate condemnation proceedings, wholly without any reference to the option agreements, by filing, in the early part of 1941, (1) motion for Leave to File Petition for Order of Summons, which was granted; (2) petition to Condemn and Fix Compensation; (3) declaration of Taking, under Section 171, 50 U.S.C.A. and 46 Stat. p. 1421, 40 U.S.C.A. § 258a. Summons was issued and served upon the landowners. Pleadings of the landowners are now substantially in agreement. They allege the execution of the option contract between the Government and the landowner; that the Government is bound by the option agreement; and therefore without power to proceed under the condemnation statutes independent of the terms of the option contract. The Supreme Court, in connection with the issues presented by the pleadings, stated:

“Thereafter the petitioners herein filed their answers in which they consented to the condemnation and demanded that the price which was fixed in the option, and accepted by the Government, be adopted by the trial court as just compensation.” (Emphasis added)

Interpreting the contracts, under which the landowners now claim interest, the opinion states:

“The offer was to sell to the Government at a fixed, definite price. The Government when it accepted this offer agreed to pay this set amount and no more. The contract contains no provision allowing adjustment of price based on possible future indeterminate expenses. * * * The Government knew the total cost when it became bound on the contract. * * * Since the United States is the purchaser of the land at the option price, no one can receive cost plus anything. Neither the vendors nor McDowell agrees to buy from a third party and sell to the Government at an advance.” (Emphasis added)

We understand the position of the landowners to be that if the Government resorts to condemnation proceedings under the contracts, the price of the lands agreed to in the option shall be accepted as the base, and “the Court should accept the agreed value as the verdict” and then proceed from that point on “under the provisions of Section 258a” 40 U.S.C.A. § 258a, 46 Stat. 1421. This the defendants assert is the proper interpretation of the option contract. Is the contract subject to such interpretation ?

The option contract should be read as a whole and interpreted from its four corners. The first paragraph fixes the consideration for which the owner agrees to sell and the Government agrees to buy the particular tract of land described. On acceptance of the option to purchase the land at the agreed price, the plaintiff may take possession. There is no provision for payment for the land at this time. It is provided that title may be acquired by the Government in either one of two ways: First, by warranty deed. If this procedure is followed, the contract provides that upon certificate of title "showing title to be vested in the United States of America” the agreed purchase price will be paid. The second method of vesting title under the agreement, namely by condemnation proceedings, is conditioned “if for any reason the title to the land is not approved by the Attorney General.” Under this procedure, the time of payment is as follows: The Government is to institute condemnation proceedings “under a consent verdict, fixing the award at the agreed value and in accordance with all the terms and provisions” of the option. Upon the Government filing its condemnation petition, under the terms of the contract, the Government is to “deposit said agreed purchase price,” with the Clerk. The contract does ¡.sot provide any date or time for the institution of condemnation proceedings where they are instituted under the terms of the contract. The contract does not provide for deposit of any sum by the Government with the Clerk, when the condemnation proceedings are under the terms of the contract except “said agreed purchase price.”

Comment has been made in this case, that after four years the Government says it is ready to comply with the terms of the contract. That position on the part of the Government was the result of the decision of the Supreme Court of the United States. There has been no claim made, and we know of no justification for its being made, of bad faith on the part of the Government in contesting the validity of the option contracts. Neither has there been any instance of purposeful delay called to our attention.

There are many landowners involved in these proceedings, represented by various counsel. Ingenious arguments have been advanced why interest should be allowed on the purchase prices remaining undeposited with the Clerk and due to various landowners under the option contracts. But the controlling question is, does the fact that the Government contested the validity of the option contract and that such contest proceedings entailed a considerable period of time, during which the landowners have been deprived of the use of part of the money, give to the landowners a legal claim for interest on the undeposited amount of the agreed purchase price? We have little doubt that had the Government initially recognized the option contracts by proceeding to perfect the title to the land by condemnation proceedings as provided for in the agreement, there would have been no claim made for interest during the period intervening between the taking of possession and the deposit of the agreed purchase price with the clerk. We are not here called upon to determine the equities of the landowners’ claims. There may be arguments on both sides of that question. This Court can only allow the landowners interest on the sums involved if a legal basis therefor exists. The basis for such an allowance must be found either in the option contracts or in some statute providing for the payment of interest. Directly in point is the opinion of the Supreme Court in tlie case of United States ex rel. Angarica de la Rue v. Bayard, 127 U.S. 251, 8 S.Ct. 1156, 1161, 32 L.Ed. 159, loc. cit. 162:

“It has been established as a general rule, in the practice of the government, that interest is not allowed on claims against it, whether such claims originate in contract or in tort, and whether they arise in the ordinary business of administration or under private acts of relief, passed by congress on special application. The only recognized exceptions are where the government stipulates to pay interest, and where interest is given expressly by an act of congress, either by the name of interest or by that of damages.”

The option contracts provide a certain fixed sum as “the consideration” for transfer from the landowner to the Government of the property described in the agreement, without qualification for the payment of interest in the event payment is delayed contrary to the terms of the contract. There is no language in the contract indicating an understanding that under any circumstances the Government was to pay the landowners one cent more than the fixed purchase price set out in the contract. The contract, by its terms, recognizes there will be an interval of time be tween the taking possession of the land under the agreement and payment of the sale price fixed by the agreement. The Government is given the right of “immediate possession” “after acceptance” of the option contract. Provision is then made for furnishing of a certificate of title after delivery of the deed, at which time “the agreed purchase price” is to be paid, or delivery of the agreed purchase price made “to the Clerk of the Court” in case title is perfected by condemnation proceedings. No interval of time is specified, no limitation upon time provided, between delivery of occupancy and payment of the “agreed purchase price” under either of the methods provided in the contract.

The foundation of the claims for interest in these cases is delay or default of the Government in paying for the land according to the contract. This does not authorize the payment of interest. As was said in United States v. State of North Carolina, 136 U.S. 211, 10 S.Ct. 920, 922, 34 L.Ed. 336, loc. cit. 339:

“But delay or default cannot be attributed to the government. It is presumed to be always ready to pay what it owes.”

The contract could have provided for interest between the time the Government took possession of the land and the landowners received the agreed price. This Court cannot rewrite the contract.

Where a contract is entered into between an individual and the Government and does not contain a provision for the payment of interest, when the contract is enforced against the Government, a contracting party cannot collect interest from ■ the Government even though the Government defaults in paying the contract price at the time provided in the agreement.

In the case of United States v. North American Transportation & Trading Co., 253 U.S. 330, 40 S.Ct. 518, 521, 64 L.Ed. 935, the Government took possession of certain lands in Alaska on which there was a placer mining claim. When the Government took possession, the company demanded compensation, which the Government’s agent promised would be paid. Twenty years later the company had reduced its claim for compensation to judgment in the Court of Claims. The company also sought interest during the intervening period. The Supreme Court held that the Company’s claim was based upon an implied contract to pay the value of the property at the time of taking. Referring to the delay in paying for the property and possible hardship resulting, the Court said:

“Congress, in thus denying to the court power to award interest, adopted the common-law rule that delay or default in payment (upon which, in the absence of express agreement, the right to recover interest rests), cannot be attributed to the sovereign. United States v. North Carolina, 136 U.S. 211, 216, 10 S.Ct. 920, 34 L.Ed. 336 [338]. That rule had theretofore been uniformly applied in our executive departments except where statutes provided otherwise. United States v. Sherman, 98 U.S. 565, 567, 568, 25 L.Ed. 235 [237]. So rigorously is the rule applied, that in the adjustment of mutual claims between an individual and the government, the latter has been held entitled to interest on its credits although relieved from the payment of interest on the charges against it. United States v. Verdier, 164 U.S. 213, 218, 219, 17 S.Ct. 42, 41 L.Ed. 407 [409, 410], This denial of interest, like the refusal to tax costs against the United States in favor of the prevailing party (Stanley v. Schwalby, 162 U.S. 255, 272, 16 S.Ct. 754, 40 L.Ed. 960, 966; Pine River Logging & Improvement Co. v. United States, 186 U.S. 279, 296, 22 S.Ct. 920, 46 L.Ed. 1164 [1172]), and the refusal to hold the United States liable for torts committed by its officers and agents in the ordinary course of business (Crozier v. [Fried] Krupp [Aktiengesellschaft], 224 U.S. 290, 32 S.Ct. 488, 56 L.Ed. 771), are hardships from which, with rare exceptions (William Cramp Sons [Ship & Engine Bldg.] Co. v. International [Curtis Marine Turbine] Co., 246 U.S. 28, 40, 41, 38 S.Ct. 271, 63 L.Ed. 560 [565, 566]), Congress has been unwilling to relieve those who either voluntarily deal with the government or are otherwise affected by its acts.”

Distinguishing a case on contract and one in condemnation (referred to as “an adversary proceeding” as distinguished from the case at bar where judgment goes for the landowner for a certain amount by consent based on contract) as respects an interest claim the Court said:

“ * * * and it may be that, even in the absence of the conformity provision referred to above, interest could be collected as a part of the just compensation in condemnation proceedings brought by the government. For, as suggested in United States v. Sargent [8 Cir., 162 F. 81, 89 C.C.A. 81], such a proceeding is not a suit by the landowner to collect a claim against the United States, but an adversary proceeding in which the owner is the defendant, and which the government institutes in order to secure title to land. Mason City & Ft. D. R. Co. v. Boynton, 204 U.S. 570, 27 S.Ct. 321, 51 L.Ed. 629. On the other hand, this suit, brought in the court of claims, is a very different proceeding. It is an action of contract to recover money which the United States is assumed to have promised to pay; and the assumed promise was to pay the value at the time of the taking.”

And in that case the Court observed— “that which the Company seeks to recover is, in substance, interest,” for the payment of which the contract did not provide and neither did any statute provide and therefore it was not collectible.

The landowners assert that their claim for payment of interest is directed under the provisions of Section 258a, 40 U.S.C.A. No other statute is relied on. This statute must be read as a whole. It provides for the acquiring of land by condemnation, and no other way. It sets out the procedure which was initiated by the Government in this case when it repudiated the option contracts. It was the procedure provided for in Section 258a, which the landowners objected to, and had their objections sustained by the Supreme Court. We do not think the provision of Section 258a has any application to these cases as they now stand. The very paragraph of that statute upon which the landowners rely to sustain their position begins by requiring “the estimated” value to be paid into Court. The statute then provides, upon payment of “the estimated” value, that “the right to just compensation (not contract price)” shall rest in the landowner. This “just compensation” is to “be ascertained” in “said proceeding,” the condemnation proceedings, and no other is contemplated by the statute. Interest is included “as part of the just compensation,” to be paid to the landowner when “just compensation” is fixed as provided under the mandate of the constitution and not by contract. United States v. 3.25 Acres of Land in Seneca County, D.C., 53 F.Supp. 884; United States v. Certain Land in St. Louis, D.C., 58 F.Supp. 305. Here the land was acquired under the provisions of 54 Stat. 712, 50 U.S.C.A.Appendix § 1171. This statute provides for the entering into “contracts” for the “acquisition of such land.” This the parties did and it was so found by the Supreme Court.

The landowners in these cases are not being deprived of their property by condemnation proceedings by virtue of the right of eminent domain, but by a contract of sale. This is not an adversary proceeding. These proceedings are now a part of the process of executing the option contracts between the landowners and the Government. If it were a case of adversary condemnation proceedings to acquire the property, then the landowners would be entitled to “just compensation” to be fixed in the manner provided by law, including interest “as a part of the just compensation.” This court cannot construe Section 258a to separate the amount of just compensation so that in the first instance it shall be a “matter of agreement” instead of “estimated” compensation, and in the second instance allow interest as a matter of “just compensation,” on an agreed price. These condemnation proceedings as they now exist, under the compulsion of the decision of the Supreme Court, are simply a technical process for the perfection of title in a procedure contemplated and agreed to by the parties for that purpose and none other. This status of the proceedings was brought about as a result of the contentions of the landowners that the Government should comply with the terms of the option contracts. Landowners, having sustained the validity of the contracts, and now standing upon them, are not now in a position to seek alteration of the contracts. If all the landowners are seeking is “just compensation,” the statutory procedure for determining “just compensation” has been offered them. On the other hand, having made the choice of standing on the option contracts, their choice would seem to indicate their belief as to which remedy is to their financial interest, contract price or “just compensation.” We do not think they are entitled to both.

Counsel for a number of the landowners stressed the fact that the declaration of taking filed by the Government in 1941 was alleged to be based on Title 40, U.S.C.A. § 258a, and other statutes. The filing of the declaration of taking by the Government in 1941 was on the assumption by the Government of a right to repudiate the option contracts. The Government already had possession of the land under the option contracts, and but for their position that the option contracts were invalid, there would have been no occasion for filing the declaration of taking. The filing of the declarations of taking was a part of the attempt by the plaintiff to acquire the landowners’ property, not by virtue of the option contracts but by condemnation and fixing of “just compensation” under the condemnation statutes. This action on the part of the Government was exactly what the landowners objected to and ultimately had their objections sustained in the Supreme Court. The effect of the decision of the Supreme Court was to nullify the attempt to repudiate the option contract by the Government and all proceedings based upon an assumed right by the Government to ignore “the option contracts and to bring such proceedings as have heretofore been taken by the Government into harmony with the provisions of the option contract; all of which is evidenced by the last pleading filed by the Government, asking for judgment vesting title and awarding the landowners judgment for the sum agreed upon in the option contracts. The Supreme Court turned the Government back from its attempt to proceed under the statute, at the instance of the landowners and in effect, if not in exact language, instructed the Government to proceed under the option contracts executed by virtue of Section 1, 54 U.S.Stat. 712, 50 U.S.C.A.Appendix § 1171.

Condemnation proceeding, as a supplement to a contract between the landowners and the Government fixing the value of land being acquired by the Government, is expressly provided for in the contract and is recognized by the authorities.

In the case of Danforth v. United States, 308 U.S. 271, 60 S.Ct. 231, 234, 84 L.Ed. 240, the landowner and Government entered into a contract for transfer of land much like the one here. The contract contained a provision for “an agreed verdict,” if condemnation proceedings were entered into to perfect the title. The Court held:

“The effect of such an agreement is to fix the value of the easement when the authority of the Court is invoked against a party to the agreement to acquire good title.”

The Government’s motion asks that the amount of the contract price be entered in the judgment. Counsel take exception to this as a variation from the word “verdict,” as the term appears in the option contract, and charge that it is contrary to the terms of the option agreement. To insist that the Government comply with the letter of the contract by first having the Court prepare a form labeled “verdict” and thereafter prepare a judgment on this verdict, appears to us as calling for a useless procedure. The courts have some control over the form of their records, and parties cannot bind the courts as to the exact form those records shall take on a matter as highly technical as that here presented.

The effect of the motion of the Government, for judgment in condemnation and for the defendant fixing the compensation in accordance with the option contracts, is substantially in accord with the provisions of the option contract. The Government is attempting to proceed in accordance with the decision of the Supreme Court as conditions now exist. Defendants ask first, that a judgment in condemnation be awarded to the Government (in accordance with the option contract), second, that the compensation to be paid the defendant be fixed in the amount of the option contracts, plus interest, and that the Court order the plaintiff to pay into the registry of the court the amount of the option contract plus interest. In view of this dispute between the Government and the landowners as to the payment of interest, the Government, following the decision of the Supreme Court, has expeditiously moved for determination of the question and decision of this Court as to the amount of money which it shall pay into the registry of the court, in accordance with the provisiohs of the option contracts.

The purchase price of the land having been fixed by contract between the landowner and the Government, a contract that now has the stamp of validity of the highest court in the land, and the landowners having elected to hold the Government to that contract in these proceedings, and the contract being silent either in express terms or by implication in creating any obligation on the part of the Government to pay interest on or in addition to the sum fixed as the sale price of the land, in the absence of a statute authorizing payment of interest, we believe plaintiff’s motion should be sustained and defendants’ motions overruled. Orders in accordance herewith will be presented.

       The form of option contract used, in all cases, is as follows.:
      “Option to Purchase Land.
      “Know All Men By These Presents: That the undersigned......and...... his wife, for and in consideration of One Dollar ($1.00), paid by the United States of America, hereinafter referred to as the Government, the receipt whereof is hereby acknowledged, hereby agrees for......heirs, executors and assigns, to sell and convey to the Government for the consideration of ...... that certain piece or parcel of land situated in the ...... more particularly described as follows:
      “Upon exercise of this option by the Government, the undersigned agrees, to pay to R. Newton McDowell a commission of five per cent (5%) of the gross sales price as full payment for the services of said R. Newton McDowell in procuring such sale, preparing the deed or deeds for the conveyance of said land and arranging for settlement and closing of the transaction.
      “The undersigned hereby grants to the Government the right of immediate occupancy and use of the land for any purpose whatsoever from and after the acceptance by the Government of this option, which acceptance shall be within thirty (30) days after date hereof, until such time as said land is conveyed to the Government by the undersigned, the title approved by the Attorney General of the United States as required by law, and the agreed purchase price paid by the Government to the undersigned.
      “The undersigned further agrees that .... will execute and deliver a general warranty deed conveying the fee simple title to the above described land to the United States of America, free and clear of all taxes, liens and encumbrances of every kind and character, including stamps, taxes and etc.; and the undersigned will also furnish, without cost to the Government, a certificate of title of The Kansas City Title Insurance Company to the said land satisfactory to the Attorney General of the United States and after examination of the deed and certificate of title by the Attorney General, the undersigned will have said deed recorded and will furnish a certificate of title of the said The Kansas City Title Insurance Company showing title to be good and marketable as vested in the United States of America, free of all liens and encumbrances. In the event the title shall be unmerchantable, the undersigned agrees to make said title merchantable at his own expense.
      “Upon furnishing of final certificate of title as above showing title to be vested in the United States of America, the agreed purchase price above mentioned will be jjaid by the Government to the undersigned.
      “If for any reason the title to the land is not approved by the Attorney General, the Government will proceed to acquire the land by condemnation proceedings instituted in the District Court of the United States in which said property is located, under a consent verdict fixing the award at the agreed valuation and in accordance with all the terms and provisions of this option and will upon filing its petition in such proceedings deposit said agreed purchase price with the clerk of said court, same to be disbursed by said officer pursuant to the decree entered in such condemnation proceedings.
      “The occupancy and use of the land by the Government as granted aforesaid shall not be interrupted, but shall continue to be enjoyed by the Government throughout the pendency of said condemnation proceedings.
      “This Option is executed in triplicate at ............ this ...... day of ......, 19...
      ■“Witness:
      “Accepted by and on behalf of the United States of America this .... day of...... 19...


source: Caselaw Access Project

author: WELSH, District Judge.

license: Public Domain

text:
    UNITED STATES ex rel. BOPP v. ABBOTT, Commanding Officer, et al.
    Civ. 5162.
    District Court, N. D. California, N. D.
    May 28, 1945.
    N. Lindsay South, of Fresno, Cal., for petitioner.
    Frank J. Hennessy, U. S. Atty., of San Francisco, Cal., and Emmet J. Seawell, Asst. U. S. Atty., of Sacramento, Cal., for respondent Brigadier General Oscar B. Abbott.
   WELSH, District Judge.

Mary Bopp filed herein a petition for writ of habeas corpus to release her son Albert Bopp from the United States Army. Said petition is based mainly on the claim that he is necessary to and regularly engaged in an agricultural occupation such as to entitle him to deferment under the Tydings’ Amendment to the Selective Training and Service Act, 50 U.S.C.A.Appendix § 305, subd. (k).

The Commanding General at Camp Beale, California, has filed a return to an order to show cause, which summarizes the steps taken by the Local Selective Service Board. Said return shows that the steps and actions taken were regular and in no sense arbitrary or capricious.

This court has had occasion to pass on two quite similar applications in United States ex rel. Alves v. Geesen, 59 F.Supp. 726, and United States ex rel. Faria v. Geesen, 60 F.Supp. 1. Opinions in both of those cases reviewed authorities which are' applicable here. In addition thereto we now refer to the opinion in Sullivan v. Swatzka, 9 Cir., 148 F.2d 965, 966, wherein the Circuit Court of Appeals held that it was not for the District Judge “to try the factual issues (1) whether the registrant’s services were necessary on his parents’ farm, (2) whether registrant was replacable. The evidence was conflicting and there is no indication that the boards acted other than judicially. That is all they were required to do.”

President Harry S. Truman, in returning without approval the Joint Resolution to amend Section 5(k) of the Selective Training and Service Act of 1940, expressed views in conformity with those of our late farsighted President Franklin Delano Roosevelt. His message contains these significant sentences: “I do not believe that it was the real intent of Congress that agricultural workers should be given blanket deferment as a group, or that Congress intended to enact legislation formulating the national policy that agricultural employment was more essential than any other type of employment, including service in the armed forces of the United States in the protection of our. country. * * * Enactment of such a law would not only be an injustice to the millions already inducted into our armed forces and those yet to be inducted. It would do violence to the basic principle embodied in section 5(e) (1) of the Selective Training and Service Act, which prohibits deferment by occupational groups or groups of individuals.” H. R. Document No. 166, 79th Congress, 1st Session, May 3, 1945.

The fact that the Congress did not pass, over the President’s veto, the proposed amendment to make agricultural deferment practically obligatory upon local Selective Service boards shows that it recognized the wisdom of these views. This Court agrees with them, and feels bound to conform to the legislative policy so reflected.

It is therefore ordered that the petition for writ of habeas corpus be, and the same is hereby, denied; and

It is hereby further ordered that the restraining order heretofore issued herein restraining the Commanding Officer of the United States Army, or whoever might have the custody of the body of said Albert Bopp, from moving said Albert Bopp out of the jurisdiction of the above-entitled court pending the hearing and determination of said petition be, and the same is hereby, dissolved and rendered of no further force or effect.

MARTIN I. WELSH, United States District Judge.


author: GODDARD, District Judge.

text:
    APPEL et al. v. LILLING.
    District Court, S. D. New York.
    April 26, 1945.
    David J. Moscovitz, of New York City (Mock & Blum and Percy Freeman, all of New York City, of counsel), for plaintiffs.
    Irving Frederick Goodfriend, of New York City, for defendant.
   GODDARD, District Judge.

The defendant has moved for summary judgment under Rule 56 dismissing the complaint on the ground that the patent on which the suit is based is invalid for double patenting.

The suit is for the infringement of Patent No. 2,256,645. This patent, issued on September 23, 1941, to Florence Kuhlman on an application filed March 28, 1941, and assigned to Robert Appel, is for a decorative material, such as may be‘ used on handbags. Claim 2 of the patent is typical: “In a decorative material, a plurality of decorative units arranged side by side each comprising a hollow rigid member having sloping sides, and pairs of opposed openings in said sides, said units being arranged with their bases in edge to edge relation, and a transverse series of interlaced tapes passing through the aligned pairs of said opposed openings to interconnect the units.”

It appears from the motion papers that the plaintiffs had also owned Design Patent No. 121,439, issued to Florence Kuhlman on July 9, 1940, on application filed May 21, 1940, and assigned also to Robert Appel. The design protected by this patent was for a handbag or similar article. The claim is limited to the design shown in the drawing, which consists of a number of plaques arranged in rows on the surface of the handbag with links between the holes in the sides of the adjacent plaques. There can be no doubt but that the drawings for the .two patents are of similar decorative material.

The precise question is whether the two patents are identical so as to be subject to the defense of double patenting. To arrive at a decision on this question the claims of the two patents must be examined to see if they are identical. See Western Electric Co. v. General Talking Pictures Corp., 2 Cir., 91 F.2d 922, 926, affirmed 304 U.S. 175, 546, 58 S.Ct. 849, 82 L.Ed. 1273. I believe that the claims of the two patents are not sufficiently identical to be subject to this defense.

The design patent is for an ornamental design formed by rows of plaques with certain indicated features. The plaques of the article patent are not so limited. Substantially changing the design on the top of the plaques would take the design outside of the protection of the design patent. Nevertheless, if strung on tapes, these plaques would infringe on the article patent. The design patent does not show what the connecting links are, nor whether they serve any function. The article patent provides for tapes running through all of the plaques in a line. The plaques in the design patent might be solid, whereas they must be hollow to come within the claims of the article patent. The plaques in the design patent might be fastened to the bag in any number of ways, such as by stitching, or by stapling. But under the article patent, the plaques must be fastened to the bag by means of the transverse tapes. The plaque surface in the design patent might be either flexible or rigid; whereas the plaque surface of the article patent is flexible. In the design patent the side of the bag might be one single solid piece shaped and colored as indicated. Under the article patent the side of the bag must be made up of a number of small units.

The design patent is based on eye appeal; whereas the article patent is based on -the combination of the hollow plaques with transverse tapes running through the plaques and holding them together. Patent No. 2,256,645 relates to the construction. Design Patent No. 121,439 covers only the external appearance. This difference distinguishes the design from the later article patent, Avoiding double patenting. Mathieu v. Mitchell Vance Co., 2 Cir., 7 F.2d 837; Bayley & Sons, Inc., v. Standart Art Glass Co., 2 Cir., 249 F. 478; Murdock v. Vaughan Novelty Mfg. Co., Inc., 51 U.S.P.Q. 214, affirmed 7 Cir., 131 F.2d 258. The case of H. C. White Co. v. Morton E. Converse & Son Co., 2 Cir., 20 F.2d 311, is not in point, since the article patent was for the same claimed invention as the design patent.

Motion denied.

Settle order on notice.


author: GOODMAN, District Judge.

text:
    Petition of GABIN.
    No. 56012.
    District Court, N. D. California, S. D.
    April 23, 1945.
    No appearance for petitioner.
    L. H. Garner, Naturalization Examiner.
   GOODMAN, District Judge.

The designated naturalization examiner has recommended the above named petitioner for citizenship.

It appears that petitioner was born in Spain on August 27, 1875, arrived in the United States in 1904, and has since continuously resided in this country. On February 4, 1921, petitioner, then being of the age of forty-five years past, pleaded guilty in the United States District Court for the District of Arizona to an indictment charging importation of smoking opium in violation of Section 2 of the Act of December 17, 1914 (38 Stats, at large 785); the court thereupon sentenced petitioner to a term of fifteen months imprisonment at Leavenworth Federal Prison and imposed a fine of $1,000. The sentence of imprisonment was served by petitioner.

The evidence adduced at the hearing upon the petition was to the effect that petitioner “has behaved as a person of good moral character” for at least five years prior to the filing of the petition for naturalization, thus satisfying the requirement of 8 U.S.C.A. Sec. 707(a). The “behavior” of the petitioner, however, amounts substantially to the following: For the past fifteen or twenty years, applicant has performed no useful work or labor, being supported by public relief agencies and by members of his family because of alleged ill health. He is now almost seventy years of age and for the first time applies for the privilege of citizenship. Thus the evidence as to his ■“behavior” is of a purely negative character. The examiner contends that petitioner, having shown behavior as a person of good moral character for the specified five year period, without more, should be admitted to citizenship.

But the court.is not restricted in its inquiry concerning the fitness of would-be citizens to the five year period. In re McNeil, D.C., 14 F.Supp. 394; In re Ross, C.C.Pa., 188 F. 685; In re Caroni, D.C., 13 F.2d 954; In re Laws, D.C., 59 F.Supp. 179; In re Balestrieri, D.C., 59 F.Supp. 181.

The aforesaid period merely fixes the minimum requirement which petitioners for citizenship must meet. 8 U.S.C.A. § 707(a).

Convicted, as he was, of engaging in the narcotic traffic for profit, while a mature man, petitioner is not, in my opinion, worthy of American citizenship. The unlawful sale or traffic in narcotics contributes more in the aggregate to human misery and degradation than any other species of human dereliction. The formal showing by petitioner that his behavior has been of a purely negative character, neither good nor bad, in the many years following his conviction, amounts at the most to a claim that the mere passage of time has made him worthy of the valuable privilege of American citizenship. However, citizenship is not a perquisite of advanced years. It is not a prize awarded for mere survival. If there were any showing of conduct of a more positive nature or character indicative of a real appreciation of the obligations of citizenship or of sacrifices made or contribution to the public weal, and the like, the petition would carry more persuasive appeal.

The petition for citizenship is denied.


author: WHITAKER, Judge. MADDEN, Judge

text:
    CAUSBY et ux. v. UNITED STATES.
    No. 46054.
    Oourt of Claims.
    June 4, 1945.

      William E. Comer, of Greensboro, N. C., for plaintiff.
    Mary K. Fagan, of Washington, D. C., and Francis M. Shea, Asst. Atty. Gen., for defendant.
    Before WHALEY, Chief Justice, and LITTLETON, WHITAKER, JONES, and MADDEN, Judges.
   WHITAKER, Judge.

Plaintiffs sue for the alleged taking by the defendant of their home and chicken farm which was adjacent to the Greensboro-High Point Municipal Airport. This airport was operated under an enabling Act of the North Carolina Legislature. It was used by commercial airliners, by private planes, and by military aircraft. The defendant used it under a lease which permitted its military airplanes to land on and take off from it, and to use one of the hangars on it and to have the exclusive use of 10 acres of land adjoining the hangar.

One of the runways on which the plane? landed and took off ran in the direction of plaintiffs’ home and chicken farm, so that planes using this runway passed directly over plaintiffs’ property. All planes, both private and military, used this runway when the wind was blowing from a certain quarter.

Plaintiffs say that most of the planes using it passed over their house harmlessly at relatively high altitudes, but that the heavier of the military planes passed over it at so low an altitude as to seriously interfere with their possession and enjoyment of their property. They say that the chickens on their chicken farm lived in such a state of fright that their fertility was greatly decreased, and that on frequent occasions they became so frightened that they blindly flew against the buildings and were killed. As a result they say they have had to sell their remaining chickens and abandon their property as a chicken farm. They also say that they themselves live in a state of constant uneasiness and that they are unable to sleep at night due to the noise of the planes passing over their house and to the glare of their lights. They continue, however, to occupy the property as a home.

The proof shows that plaintiffs’ barn is 2,220 feet from the end of the paved portion of the northwest-southeast runway, the tallest tree is 2,230 feet from it, and plaintiffs’ house is 2,275 feet from it. The elevation of plaintiffs’ property is from five to six feet below that of the runway.

According to the rules and regulations of the Civil Aeronautics Authority, the ideal glide angle is not less than 30 to 1. This means that there must be no obstruction more than a foot high 30 feet from the end of the runway, and that the height of any obstruction must not exceed 1/30 of its distance from the end of the runway. This angle of glide is supposed to be safe under the worst conditions. The highest tree on plaintiffs’ property is 18 feet below this glide angle, plaintiffs’ barn is 63 feet below it, and plaintiffs’ house is 67 feet below it. Not infrequently defendant’s planes passed over plaintiffs’ property at approximately these heights. On some occasions the backwash from the propellers blew the dead leaves off the trees.

Plaintiffs’ testimony that the fertility of their chickens was so decreased, and that so many of them were killed as a result of fright that their business became so unprofitable that they had to abandon it, is not disputed; nor that the value of the property has greatly decreased. Nor is it disputed that all planes used the runway which passed over plaintiffs’ property when the wind was blowing from a certain direction, nor that the defendant intended to continue to do so as long as it continued to use the airport. The defendant does say that this runway was used only from 4 to 7 percent of the time, but it does not deny that it intended to continue to use it whenever the wind blew from a certain quarter, so long as it continued to use the airport.

The term of the lease began on June 1, 1942, and ran for a period of thirty days, but with the privilege of renewal until June 30, 1967, or until six months after the end of the present national emergency, whichever date was the earlier. It is still in force and defendant continues to use the airport.

The question is whether or not the passage of defendant’s planes over plaintiffs’ property at the stated heights above it, with the result stated, and its intention to continue to have them pass over it for an indefinite period, constitutes a taking.

Under the old common law doctrine of cujus est solum ejus est usque ad coelum et ad inferos a landowner not only owns the surface of his land, but also owns all that lies beneath' the surface even to the bowels of the earth and all the air space above it even unto the periphery of the sky.

Under this doctrine any erection over the land of another, or any passage through the air space above it, is a trespass. So, if an adjoining landowner allows the eaves of his house to extend beyond his own property and over the land of another he has committed a trespass. Broom’s Legal Maxims, 310; Crowhurst v. Amersham Burial Board, 4 Ex.D. 5, 10; Ackerman et al. v. Ellis, 81 N.J.L. 1, 79 A. 883. A telephone or telegraph company which stretches its wires over the land of another without permission is guilty of a trespass. Butler v. Frontier Telephone Co., 186 N.Y. 486, 491, 79 N.E. 716, 11 L.R.A.,N.S., 920, 116 Am.St.Rep. 563, 9 Ann.Cas. 858. The shooting of guns over another’s land is also a trespass, although the bullets do not land upon it. Whittaker v. Stangvick et al., 100 Minn. 386, 111 N.W. 295, 10 L.R.A.,N.S., 921, 117 Am.St.Rep. 703, 10 Ann.Cas. 528; Restatement of the Law of Torts, sec. 159.

Elowever, especially since the days of airplanes, this common law doctrine has received substantial modification. But even so, there can be no doubt that today a landowner owns the air space above his land as completely as he does the land itself or the minerals beneath it, at least insofar as it is necessary for his full and complete enjoyment of the land itself. So, he may erect buildings on his land to any desired depth or height, subject, of course, to necessary police regulations, and, subject, of course, to the right of eminent domain, he may prohibit the erection over it of any structures of any character or the passage over it of anything that interferes with his right to light, air, view, or the safe and peaceful occupation and enjoyment of his land. Smith v. New England Aircraft Co., 270 Mass. 511, 170 N.E. 385, 69 A.L.R. 300; Delta Air Corporation v. Kersey, 193 Ga. 862, 20 S.E.2d 245, 140 A.L.R 1352; Restatement of the Law of Torts, sec. 194; Pollock on Torts, 13th Ed., p. 362; Burdick’s Law of Torts, 4th Ed. 406; Act of May 20, 1926, c. 344, 44 Stat. 568, 574, sec. 10; 49 U.S.C. 180. Cf. Northwest Airlines v. Minnesota, 322 U.S. 292, 64 S.Ct. 950, 88 L.Ed. 1283; Hinman et al. v. Pacific Air Transport Corporation, 9 Cir., 84 F.2d 755.

Under the facts of this case there can be no doubt that defendant has committed numerous trespasses upon plaintiffs’ property. It ,has traversed many times the air space above their property at such an altitude and with planes of such a character as to seriously interfere with plaintiffs’ use and enjoyment of their property, even to such an extent as to make it necessary for them to abandon it as a chicken farm.

A trespass upon the property of another, however, does not ordinarily constitute a taking, but if it is sufficiently frequent or if there is otherwise shown an intention to continue it at will, such continued trespasses or intention may amount to a taking, if they destroy the owner’s use and enjoyment of his property. Hurley v. Kincaid, 285 U.S. 95, 103, 52 S.Ct. 267, 76 L.Ed. 637; Jacobs v. United States, 290 U.S. 13, 16, 54 S.Ct. 26, 78 L.Ed. 142, 96 A.L.R. 1; Portsmouth Harbor Land & Hotel Co. v. United States, 260 U.S. 327, 43 S.Ct. 135, 67 L.Ed. 287.

The case last cited was before the Supreme Court on three different occasions. Its first opinion was in a case styled Peabody v. United States, 231 U.S. 530, 34 S.Ct. 159, 58 L.Ed. 351, its second in Portsmouth Harbor Land & Hotel Co. v. United States, 250 U.S. 1, 39 S.Ct. 399, 63 L.Ed. 809. Under the facts in the two former opinions the Supreme Court held that there had not been a taking. The case reported in 260 U.S. 327, 43 S.Ct. 135, 136, 67 L.Ed. 287, came before the court upon a demurrer which had been sustained by this court. The facts stated in the petition were that the defendant had erected a fort on a strip of land immediately to the west of plaintiff’s land and that it had planted guns therein which could be fired only over plaintiff’s land; that a fire control tower had been erected for the firing of these guns, and that the defendant intended to fire them across plaintiff’s land at will, with the result that it had been deprived pf the use and enjoyment of its property. Of such a case the court said:

“ * * * There is no doubt that a serious loss has been inflicted upon the claimant, as the public has been frightened off the premises by the imminence of the guns; and while it is decided that that and the previously existing elements of actual harm do not create a cause of action, it was assumed in the first decision that — ‘If the Government had installed its battery, not simply as a means of defence in war, but with the purpose and effect of subordinating the strip of land between the battery and the sea to the right and privilege of the Government to fire projectiles directly across it for the purpose of practice or otherwise, whenever it saw fit, in time of peace, with the result of depriving the owner of its profitable use, the imposition of such a servitude would constitute an appropriation of property for which compensation should be made.’ 231 U.S. 538, 34 S.Ct. 160, 58 L.Ed. 351. That proposition we regard as clearly sound. The question is whether the petition before us presents the case supposed.

* * * * *

“If the United States, with the admitted intent to fire across the claimants’ land at will should fire a single shot or put a fire control upon the land, it well might be that the taking of a right would be complete. But even when the intent thus to make use of the claimants’ property is not admitted, while a single act may not be enough, a continuance of them in sufficient number and for a sufficient time may prove it. Every successive trespass adds to the force of the evidence. The establishment of a fire control is an indication of an abiding purpose. * * * ”

The court held that the petition, alleging the facts set out above, did state a cause of action and our judgment sustaining the demurrer was reversed.

We think the case at bar is controlled by that case. In that case there had been no invasion of the land itself, and defendant had fired Its guns across it but twice, but there was alleged .an intention to fire over it at 'will, with the result that plaintiff, had been deprived of its profitable use as a summer resort. Here there have been frequent invasions of the air space above plaintiffs’ land, and the evidence shows an intention to continue these invasions whenever the wind blows in a certain direction. As a result plaintiffs have been deprived of the use of their property as a chicken farm.

In both cases, to paraphrase the Supreme Court’s opinion in Peabody v. United States, supra, reiterated in Portsmouth Harbor Land & Hotel Co. v. United States, supra, a servitude has been imposed on the property which constitutes an appropriation of it. It was not a complete appropriation in either case, it is true. In both cases there was a taking only of the air space above plaintiffs’ property, but this resulted in damage to the remainder of the property; and it is well settled that a plaintiff may recover not only the value of the part of his land which has been taken, but also the damage to the remainder resulting from the taking of a part of it. Bauman v. Ross, 167 U.S. 548, 574, 17 S.Ct. 966, 42 L.Ed. 270; United States v. Grizzard, 219 U.S. 180, 31 S.Ct. 162, 55 L.Ed. 165, 31 L.R.A.,N.S., 1135.

But, it is said that in the case at bar the evidence indicates that the defendant did not intend to permanently appropriate to its own use this easement over plaintiffs’ property since it reserved the right to renew its lease on the airport only until June 30, 1967, or six months after the end of the present national emergency, whichever date was earlier. Whether or not the defendant intended to appropriate unto itself a permanent or a temporary right to use the air space over plaintiffs’ land, there was nevertheless a taking of it. A. W. Duckett & Co. v. United States, 266 U.S. 149, 45 S.Ct. 38, 69 L.Ed. 216; Brigham v. Edmands, 7 Gray, Mass., 359; McKeon v. New York, New Haven & Hartford Railroad Co., 75 Conn. 343, 53 A. 656, 61 L.R.A. 736, affirmed in a per curiam opinion in 189 U.S. 508, 23 S.Ct. 853, 47 L.Ed. 922; Cavanagh v. Boston, 139 Mass. 426, 1 N.E. 834, 52 Am.Rep. 716; Paine v. Savage, 126 Me. 121, 136 A. 664, 51 A.L.R. 1194; Steinhart v. Superior Court, 137 Cal. 575, 70 P. 629, 59 L.R.A. 404, 92 Am.St.Rep. 183; Cape Girardeau v. Hunze, 314 Mo. 438, 284 S.W. 471, 47 A.L.R. 25; Norwood v. Sheen, 126 Ohio St. 482, 186 N.E. 102, 87 A.L.R. 1375. All of these cases are authority for the proposition that there has been a taking within the meaning of provisions of a Constitution similar to the Federal Constitution entitling the owner to recover just compensation, although the taking is only temporary. Cf. United States v. General Motors Corporation, 323 U.S. 373, 65 S.Ct. 357.

But, we cannot conclude from the mere fact that the defendant reserved the right to renew its lease on the airport for a limited period, 25 years, or less if the national - emergency did not last so long, that defendant intended to appropriate this easement unto itself only temporarily. Upon the expiration of its current lease on the airport defendant no doubt intended to make some sort of arrangement whereby it could use the airport for its military planes whenever it had occasion to do so.

At any rate, it seems clear to us that the defendant asserted the right to have its planes fly over plaintiffs’ property as low as the stated heights whenever it chose to do so. We, therefore, think that the defendant appropriated this easement unto itself permanently, not temporarily, and that the plaintiffs are entitled to recover, if at all, on this basis.

The defendant also says that it is not liable because plaintiffs’ land was taken, if at all, in the conduct of military operations in time of war, and for such a taking the defendant is not liable. This is quite clearly erroneous. The plaintiffs are entitled to recover under the constitutional provision that private property shall not be taken without just compensation. This provision has the same validity in time of war as in time of peace. The Constitution is not set aside in time of war. Indeed, the restraints of that instrument are especially necessary when our ordinary respect for the rights of others is often consumed in the hot fire of the passions aroused by war.

Plaintiffs are not entitled to recover for the damage to their business, but they are entitled to recover the special value of the land due to its adaptability for use for this business. Joslin Mfg. Co. v. Providence, 262 U.S. 668, 675, 43 S.Ct. 684, 67 L.Ed. 1167; Mitchell v. United States, 267 U.S. 341, 45 S.Ct. 293, 69 L.Ed. 644; Dominion Smelting & Refining Corp. v. United States, 102 C.Cls. 281.

From all the testimony, we have concluded that the value of the property destroyed and of the easement taken and the damage to plaintiffs’ property resulting from the taking of -this easement is the sum of $2,000.00. A judgment in the nature of a jury verdict will be rendered for this amount. It is so ordered.

WHALEY, Chief Justice, and LITTLE-TON, Judge, concur.

MADDEN, Judge

(dissenting).

I am unable to agree with the decision of the court for several reasons.

First. The court awards the plaintiffs $2,000, one-half the value of their property. This award can be justified only by assuming that the activities of the Government which are the basis for this suit are to be carried on permanently. There is no basis in the evidence for such an assumption. The Government’s lease on the airport is to terminate six months after the end of the present national emergency. When the lease terminates, the plaintiffs’ property will be just as useful and just as valuable as it was before the Government leased .the airport in 1942. The plaintiffs will have their property, unimpaired, and also one-half of its value. Just compensation for a partial impairment of value for what will probably be about four years’ use does not amount to one-half of the fee value of the property. After the Government has paid the judgment, it will have no way of recouping the money which if has been obliged to pay for a permanent right which it does not want and has no expectation of using. It will have nothing to sell, since the privilege of flying military planes at low altitudes over the plaintiffs’ property could be of no use to anyone but the Government.

Second. I think that the Government has the right, at least in wartime, to have its military planes fly through the air space over a landowner’s land, when the flights are at safe altitudes and are no more frequent than they were in this case. There is no question here of danger of physical contact with the plaintiffs’ property. By recognized standards, the glide angles for even the heaviest of planes were such that they easily cleared the plaintiffs’ buildings and trees. The Government’s activities at the airport were conducted with great care, so that, in fact, the plaintiffs’ property was no more subject to peril of physical contact than that of the countless persons throughout the country over whose homes planes fly at various heights. The harm to the plaintiffs’ property resulted from the noise of planes, and, to a slight degree, from the lights of the occasional night flying planes. These annoyances are real, and may diminish the value of property. But all those whose property lies near a railroad, or a highway, or a street car line, •suffer from these annoyances in varying degrees, and practically always without compensation, even though the owner of the annoying enterprise is a private or municipal corporation which is fully subject to suit.

When railroads were new, cattle in fields in sight and hearing of the trains were alarmed, thinking that the great moving •objects would turn aside and harm them. Horses ran away at the sight and sound of a train or a threshing machine engine. The farmer’s chickens have to get over being alarmed at the incredible racket of the tractor starting up suddenly in the shed adjoining the chicken house. These sights and noises are a part of our world, and airplanes are now and will be to a greater degree, likewise a part of it. These disturbances should not be treated as torts, in the case of the airplane, any more than they are so treated in the case of the railroad or public highway.

Third. Assuming that what the Government did was a legal wrong, I do not think that it was a taking of the plaintiffs’ property. If not, the Constitution and the statute defining our jurisdiction give the plaintiffs no right to recover. The nature of the court’s judgment, an award of one-half the value of the property, would indicate that the compensation is for damage done to the property, rather than for taking it. The plaintiffs still have the property, and will have it after the judgment. They will also have, of course, the amount of the judgment. The court’s method of resolution of this seeming contradiction is to say that the Government has taken, not the property or one-half or any part of it but an easement in or through it. Then, the reasoning goes, the damage to the property may be appended to the interest taken, and thus included in the award made for the taking. I recognize that if the Government takes a part of a man’s land, and the effect of the taking is to damage the part not taken, as, for example, by depriving it of access to a road, the incidental damage may be recovered in the suit for the taking.

The court’s conclusion that an easement of flight was taken is, I think, erroneous. As I have said, I think the Government had the privilege, at least during the war, of making the flights which it has made. If so, it needed no granted easement and cannot be regarded as having taken one by doing what it had the right to do. And if it did not have the right to make the flights, I have difficulty in determining the nature of the easement which it took and should pay for. If the flights were, as the court’s opinion must assume, trespasses, they would, if the defendant were an ordinary litigant, be the subject of a damage suit for past damages, and an injunction against repetition. But the fact that an ordinary person had committed trespasses on the plaintiffs’ land in the past would not give the plaintiffs a right to sue the trespasser as if he had taken the land, or an easement in it, and make him pay the permanent value of the land or the easement. There is no such doctrine of the conversion of land to one’s own use by taking liberties with it, as there is in regard to personal property. Hence the plaintiffs could get no such remedy against a private defendant as they are being given here. It seems then as if the court is, by way of compensation to the plaintiffs for the fact that the Government is not suable in tort, giving them a remedy against the Government by way of compensation for property taken, which in its nature, and especially in the amount of the recovery, differs completely from any remedy the plaintiffs might have against a private litigant.

There might be justification for this stretching of legal doctrine if there was any showing of an intention on the part of the Government to make permanent use of the plaintiffs’ land. But, as I have said, the Government’s lease on the airport ends six months after the end of the war. Hence it is having a permanent easement forced upon i-t which it has no use for and should not be obliged to pay for. In the case of Portsmouth Harbor Land & Hotel Co. v. United States, 260 U.S. 327, 43 S.Ct. 135, 67 L.Ed. 287, the court held that if the Government’s installation of a coastal defense battery was with the intent of maintaining it there in time of peace, and firing projectiles across the plaintiff’s land whenever it chose to do so', that would constitute a taking for which compensation should be made, but if it was merely placed as a defensive measure in time of war, it would nor constitute a taking. This decision supports the idea which I have expressed above that the Government is privileged to carry on activities in wartime which may be harmful to landowners, which activities would not be privileged in time of peace. But I suppose it also shows the court’s reluctance to saddle upon the Government the burden of paying the permanent value of land or interests in land for which it has no desire or use, it merely needing the use for the temporary period of the emergency. I think, therefore, that if the court concludes that the Government’s repeated trespasses amount to the taking of an easement, it should award compensation for that easement, and for the incidental damage -to the land, only down to the time of judgment, and should retain the case for the award of further compensation when the Government’s use of the airport, and its easement, terminate at the end of the war. In this way the court could avoid compensating the plaintiffs in an amount several times as great as. any loss which they will, in all probability, suffer.

JONES, Judge, took no part in the decision of this case.


author: MADDEN, Judge.

text:
    SCHAFFER v. UNITED STATES.
    No. 45990.
    Court of Claims.
    June 4, 1945.

      Glenn Thomas Cousins, of Clinton, Iowa (Miller, Miller & Cousins, of Clinton, Iowa, on the brief), for plaintiff.
    Kendall M. Barnes, of New York City, and Francis M. Shea, Asst. Atty. Gen., for defendant.
    Before WHALEY, Chief Justice, and LITTLETON, WHITAKER, JONES, and MADDEN, Judges.
   MADDEN, Judge.

The plaintiff operated an automobile “graveyard” at Clinton, Iowa. He bought old or wrecked cars and placed them on his several acres of land. His purpose was to obtain from them usable parts which he could sell at retail, and to sell for scrap the hulks of the cars including such parts as he did not succeed in retailing for further use. In June of 1942 the plaintiff had 177 cars or trucks, or the hulks of them, on his premises. There being at that time a great need for scrap steel, as well as for non-ferrous metals such as aluminum, copper, and brass, for war production, the Government tried to get a great deal of the metal, which was in the thousands of automobile graveyards throughout the country, moved to the steel and other metal producing plants.

The Act of October 16, 1941, 55 Stat. 742, 50 U.S.C.A.Appendix § 721 et seq. authorized the President to requisition, inter alia, “materials necessary for the manufacture, servicing, or operation of such equipment, supplies, or munitions * * * needed for the defense of the United States.” Correspondence, quoted in findings 3 and 4, between the plaintiff and the War Production Board, which was acting for the President, shows that the Board attempted to get the plaintiff to sell the contents of his yard at scrap or junk prices. The plaintiff, asserting that such prices would not include the value of usable parts which the plaintiff expected to get from the cars in his yard, refused, and, on June 17, 1942 the Government requisitioned and caused to be taken away all the cars, trucks, parts, tires and tubes in the plaintiff’s yard and buildings. The materials were weighed and the plaintiff was offered $4,157.80 which was the right price of the materials as scrap. He refused to settle for this amount, and, under the terms of the requisition statute, accepted one-half the amount, or $2,-078.90, without prejudice to his right to recover more, if he was entitled to it, in this court.

We think the Government’s offer to pay only scrap prices for the plaintiff’s materials was too low. If they were worth no more than that, there would be no point in any automobile graveyard enterprise, since the scrap value could be obtained immediately upon the automobiles being brought into the yard. There are thousands of these enterprises in the country, and have been for many years, so there must be a profit to be made by detaching and selling, for further use, parts, including tires and tubes, from old and wrecked cars. The plaintiff is, therefore, entitled to more than he was offered.

The question of how much the plaintiff’s stock was worth is difficult, and cannot be determined with much precision. The plaintiff made an inventory at the time the Government was taking the materials away, in which he listed all the parts, of the kind usually saleable, whether they were still incorporated in a hulk of a car, were lying in or under or beside it, where they had been placed when other parts were taken from the car, or had been laid away in a shed, as some parts of kinds most sensitive to the weather, such as motors and generators, and tires and tubes, had been. He valued each part at its retail sale price as a used part, then discounted the totals for tires and tubes by 20 percent, and the totals for other parts by 33V3 percent, the discount being on the theory that the Government’s bulk requisition relieved him of the necessity of retail handling, and hence the price should be a bulk sale price. The total given by the plaintiff’s figures is $12,263.84. The prices of individual parts shown in the plaintiff’s inventory are approximately correct in the sense that if a customer came along who happened to need and want to buy any one of the parts, that would have been the price he would have paid. But we do not think the plaintiff had any reasonable prospect of selling at retail more than a fraction of the potentially saleable parts in his yard. As we understand the automobile graveyard business, the customers’ wants are highly particularized. For example, his 1933 Chevrolet has a cracked cylinder head. He could buy a new one, but its costs would be large in comparison with the value of his car, so he may go to an auto graveyard to see if he can get one there. There might be one or several 1933 Chevrolets there, and one or more of them might have a usable cylinder head. If so, a sale will result. But every sale is, to a considerable extent, a chance meeting of a highly particularized demand, out of a supply which must be of considerable variety if it is to have any prospect of meeting such a demand. From any particular car in stock, only a few out of the many potentially saleable parts may ever be asked for by customers. The result, as we understand it, is that á large portion of the potential supply must ultimately go for scrap, as the models in the yard become older and fewer cars of the kind that might need such parts are running.

We think, therefore, that the plaintiff’s asserted values which are based, in general, on an assumption that every potentially saleable part would have been sold, are far too high. We have, on the basis of the highly conflicting testimony, come to the conclusion that, considering the plaintiff’s stock of tires and tubes as well as his stock of potentially saleable parts, and the four cars that were potentially saleable intact, he had a reasonable prospect of re-selling for further use about one-fourth of his inventory. We therefore think he should have been paid $6,250. He was offered $4,157.80 and was paid $2,078.90. He may recover $4,171.10, with interest at 4 percent per annum, as a part of just compensation, from June 17, 1942.

It is so ordered.

WHALEY, Chief Justice, and LITTLE-TON, WHITAKER, and MADDEN, Judges, concur.

JONES, Judge, took no part in the decision of this case.


author: WHITAKER, Judge.

text:
    REGENOLD v. UNITED STATES.
    No. 45762.
    Court of Claims.
    June 4, 1945.

      Scott P. Crampton, of Washington, D. C. (George E. H. Goodner, of Washington, D. C., on the brief), for plaintiff.
    Elizabeth B. Davis, of Washington, D. C., Samuel O. Clark, Jr., Asst. Atty. Gen. (Robert N. Anderson and Fred K. Dyar, both of Washington, D. C., on the brief), for defendant.
    Before WHALEY, Chief Justice, and WHITAKER, MADDEN, LITTLETON, and JONES, Judges.
   WHITAKER, Judge.

The question presented in this case is whether or not the income received by Elizabeth A. Wilson from her dower interest in the estate of her husband R. E. Lee Wilson is taxable to her as income.

R. E. Lee Wilson died on September 27, 1933, seized and possessed of five parcels of real estate. From four of these parcels his widow received rent in the year 1934 in the amount of $1,398.04, in the year 1935, $7,-456.32, and in the year 1936, $7,572.69. These sums were included within her gross income. This is alleged to have been erroneous.

When R. E. Lee Wilson died the value of his widow’s dower interest in the real estate of which he died seized and possessed was fixed at $14,873.70: Plaintiff contends that the widow’s estate is entitled to recover this value before the income from the property is taxable to it. This we think is erroneous.

What the widow got on the death of her husband was a life estate in one-third of the real estate of which he died seized and possessed. Under section 22 (b) (3) of the Revenue Act of 1934, 48 Stat. 680, 687, and a similar section of the Revenue Act of 1936, 49 Stat. 1648, 1657, 26 U.S.C.A. Int. Rev.Code, § 22 (b) (3), the value of this interest is not income to the recipient in the year in which it was received, but under these sections “the income from such property shall be included in gross income.” The value of Mrs. Wilson’s dower interest was not included in her income in the year in which it was received; it is the income from this interest which has been included in her income. This seems to be clearly in accordance with the provisions of the Acts.

In Tree et al. v. United States, 102 Ct.Cl. 128, 55 F.Supp. 438, it was conceded that if the income included in plaintiff’s gross income had been income from her dower interest in her deceased husband’s estate it would have been taxable to her. This concession was made necessary not only by the provisions of the Act, but also by our decision in Brooks v. United States, 6 F.Supp. 844, 79 Ct.Cl. 470, and by the decision of the Supreme Court in Irwin v. Gavit, 268 U.S. 161, 45 S.Ct. 475, 476, 69 L.Ed. 897.

In Brooks v. United States, supra, the plaintiff insisted that he had the right to recover the value of his life estate m a trust fund created by the will of his grandmother before he was taxable on the income therefrom. This contention was rejected by us on the authority of Irwin v. Gavit, supra, and other cases.

In Irwin v. Gavit, supra, the plaintiff insisted that he was not taxable on the income which he was entitled to receive from a trust estate created by his mother-in-law, a portion of the income from which he was entitled to receive over a period not to exceed 15 years. The court rejected that contention, saying: “* * * The language quoted leaves no doubt in our minds that if a fund were given to trustees for A for life with remainder over, the income received by the trustees and paid over to A would be income of A under the statute. It seems to us hardly less clear that even if there were a specific provision that A should have no interest in the corpus, the payments would be income none the less, within the meaning of the statute and the Constitution, and by popular speech. In-the first case it is true that the bequest might be said to be of the corpus for life, in the second it might be said to be of the income. But we think that the provision of the act that exempts bequests assumes the gift of a corpus and contrasts it with the income arising from it, but was not intended to exempt income properly so-called simply because of a severance between it and the principal fund. No such conclusion can be drawn from Eisner v. Macomber, 252 U.S. 189, 206, 207, 40 S.Ct. 189, 64 L.Ed. 521, 9 A.L.R. 1570. The money was income in the hands of the trustees and we know of nothing in the law that prevented its being paid and received as income by the donee.”

Under the authority of the cases cited, we must hold that plaintiff’s part of the income from the property in which Elizabeth A. Wilson had a dower interest was properly included in her gross income.

Plaintiff’s petition is dismissed. It is so ordered.

WHALEY, Chief Justice, and MADDEN and LITTLETON, Judges, concur.

JONES, Judge, took no part in the decision of this case.


author: WHALEY, Chief Justice.

text:
    HARRY KAUFMAN, Inc., v. UNITED STATES.
    No. 44395.
    Court of Claims.
    June 4, 1945.

      Maurice H. Thatcher, of Washington, D. C. (Fred B. Rhodes, of Washington, D. C., on the brief), for plaintiff.
    John B. Miller, of Washington, D. C., and Francis M. Shea, Asst. Atty. Gen., for defendant.
    Before WHALEY, Chief Justice, and LITTLETON, WHITAKER, JONES, and MADDEN, Judges.
   WHALEY, Chief Justice.

The plaintiff is a wholesale and retail dealer, purchasing goods from jobbers and manufacturers and reselling them. Its activities are confined to merchandizing. It does not manufacture. It is suing here for increased costs incurred as a result of enactment of the National Industrial Recovery Act, 48 Stat. 195, as authorized by the act approved June 25, 1938, 52 Stat. 1197, 41 U.S.C.A. § 28 note, giving this court jurisdiction to hear and render judgment upon claims of Government contractors.

The plaintiff here was such a contractor.

In response to an invitation it submitted certain bids to the Treasury Department Four of them were opened February 1, 1933, and one February 17, 1933. The business solicited by the plaintiff was the furnishing of some of the items for the fiscal year ending June 30, 1934, enumerated by classes in the well-known General Schedule of Supplies of the General Supply Committee, Treasury Department. The plaintiff with its bids furnished bond to accept the contract on any item awarded. It was the successful bidder on certain items, and as to these items, pursuant to the terms of its bid and bid-bond, it entered into a formal contract with the defendant July 1, 1933, to supply them.

The General Supply Schedule is printed and distributed. It bears the name of each contractor and the unit contract price against particular items. By reference to it a Government agency desiring an article may at any time during the fiscal year order it of the contractor named in the schedule and the contractor furnishes it at the agreed price, also named in the schedule.

Under this agreement Government agencies might call upon the plaintiff for large or small quantities, or none at all.

With this method of doing business, quantities and dates of delivery not being predetermined, the plaintiff did not make firm contracts in advance with manufacturers or jobbers. The plaintiff of course did not know what quantities the Government, in the course of the fiscal year, would demand, or when. What the plaintiff did in preparing its bid, was to rely on prices quoted to it by manufacturers or jobbers. These quotations were necessarily given before the opening of bids February 1 and 17, 1933, and the contract price, based on such quotations, was applicable for one year beginning July 1, 1933. There was thus a five-month period from quotation to the beginning of the contract period, and nearly a year and a half to the end of the contract period. The plaintiff, being bonded to accept the award, could not thereafter withdraw its bid.

There was an increase- in prices from those quoted to the plaintiff in or before February, 1933, to those paid by the plaintiff to fulfill the supply contract. So much of that increase as was a result of enactment of the National Industrial Recovery Act, except as to items on which there was a profit, plaintiff here seeks to recover under the act of June 25, 1938. No labor performed by the plaintiff is involved.

It is to be noted that the plaintiff was a merchant, and that the goods it purchased and sold had already gone through manufacturing processes. The national industrial recovery program endeavored to and did reverse the downward trend of wages, with the natural result that materials on which labor was expended, that is to say manufactured goods, tended to increase in price, as wages increased. This was of course true with respect to goods already manufactured, as well as those in the process of manufacture.

The effect of wage fluctuations on the price of goods passing through the hands of many skilled wage-earning operatives, may be considerable. But it does not necessarily follow that a wage increase is precisely reflected in the selling price. There are too many influences present in arriving at a price agreeable to vendor and vendee for anyone to say that a specific wage increase is fully incorporated in the negotiated price.

In the background of vendor and vendee, as they sit across the table dickering on a price, stand competitors, tax assessors, manufacturers, jobbers, market reporters, the ever-present supply and demand, the relative strength in the market of the negotiators, and other factors familiar to the business world. So that as a matter of practical application it is impossible to segregate any exact part of an increase in the price of goods and definitely and finally say that that exact amount is the result of enactment of the National Industrial Recovery Act.

But it is manifest that Congress had in mind the existence of such increases in the price of material, the result of enactment of the National Industrial Recovery Act, for Congress provided for their recovery. The Congress recognized the situation as having actuality, and in the case of Government contractors, deserving remedial measures.

In the case of Phillips v. United States, 102 Ct.Cl. 446, a case arising under the same act as here, it was said that the burden of proof was always on the plaintiff to establish his case by a “preponderance of evidence.” This was said with reference to labor costs, which the court did not allow in judgment because that burden had not been met.

But in the case we have here, involving a disputed increase in cost of materials, we think that the burden of proof by a preponderance of the evidence has been met. The plaintiff’s principal witness, a highly-placed officer of the plaintiff corporation, testified to the effect that the increase was the result of enactment of the National Industrial Recovery Act, and he was especially qualified to testify on that point because he was not only directly involved in the buying and selling of the goods in question, but he had had a generation of experience, going in and out of and circulating within the market. A business man of that experience is entitled to be heard, and his testimony calls for rebuttal at the same level, which the defendant did not undertake to offer. There was one witness only for the defendant, an accountant, who expressly disqualified himself to testify as to whether the “N. R. A.” increased or decreased the cost of the goods. He was not an expert on market affairs. It is manifest that the books of account would not disclose the increases that are here in issue, and he frankly stated his inability to discover them. His testimony is to be evaluated on an accounting basis and is not to be accepted on matters outside his qualifications.

The plaintiff has suffered a loss due to the increase in cost attributable to the National Industrial Recovery Act for which he should be compensated.

The evidence is not sufficient to measure that loss exactly. However, taking all the evidence into consideration and acting as a jury of reasonable men would act under the circumstances, we think the plaintiff would be fairly and equitably compensated by the award of $4,000.00

A judgment for $4,000.00 will be entered for the plaintiff.

It is so ordered.

MADDEN, WHITAKER, and LITTLETON, Judges, concur.

JONES, Judge, took no part in the decision of this case.