United States v. 1,380.09 Acres of Land
Opinion of the Court
The United States brought a proceeding to condemn land owned by the Bodcaw Company, and deposited $99,650 in the court registry as the estimated just compensation for the taking. The Bodcaw Company responded that the amount tendered by the Government was inadequate, and also sought compensation for the expenses of appraising the land and for expert witness fees. A jury trial resulted in an award in favor of the Bodcaw Company for $146,206 as the value of the land, and $20,512.50 was granted to reimburse the appraisal and expert witness expenses incurred by the company. The Government contends that the award of appraisal and expert witness fees is not authorized either by statute or by the Fifth Amendment. We conclude that the appraisal expenses in this ease are part of the just compensation mandated by the Fifth Amendment,
The sole issue is whether the appraisal and expert witness fees are elements of just compensation, or whether such expenses are better characterized as “costs” which cannot be taxed against the United States in this condemnation proceeding.
It is well settled that attorneys’ fees and court costs are not part of just compensation, see, e. g., United States v. 2,353.28 Acres of Land, 5 Cir., 1969, 414 F.2d 965, 972, and cannot, with limited exceptions, be taxed to the Government in condemnation cases.
“ ‘[jjust compensation’ invokes the equitable powers of the court, and courts must use their equity powers to put an owner of land being condemned in as good position as he would have been if his property had not been taken . . . .” Id. at 452.
In concluding, the court emphasized that it was not holding that every survey undertaken by a landowner faced with condemnation must be paid by the Government, but only that compensation was equitable under the facts of that case.
The critical question is whether Lee’s reasoning in regard to survey expenses applies to the appraisal costs incurred in this case. The court in Lee emphasized that the determination of just compensation was equitable in nature, and was therefore dependent on the factual context and equities of each case. In addition, the Lee court stated that the central goal of just compensation was to place the landowner in as good a financial position as he would have been absent the taking of his property. These factors are equally present in this case. The land taken by the Government was not of such character that accurate estimates of value easily could be made.
AFFIRMED in part, REVERSED in part, and REMANDED.
. The Fifth Amendment to the United States Constitution reads in part: “nor shall any person ... be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.”
. Without an authorizing statute, costs cannot be assessed against the United States. See United States v. 4.18 Acres of Land, 9 Cir., 1976, 542 F.2d 786, 788. However, 42 U.S.C. § 4654(a) provides that
(a) The Federal court having jurisdiction of a proceeding instituted by a Federal agency to acquire real property by condemnation shall award the owner of any right, or title to, or interest in, such real property such sum as*240 will in the opinion of the court reimburse such owner for his reasonable costs, disbursements, and expenses, including reasonable attorney, appraisal, and engineering fees, actually incurred because of the condemnation proceedings, if—
(1) the final judgment is that the Federal agency cannot acquire the real property by condemnation; or
(2) the proceeding is abandoned by the United States.
. See 42 U.S.C. § 4654(a), at note 2 supra.
. Lee has been noted by this court on three occasions. In Henning v. Lake Charles Harbor & Terminal Dist., 5 Cir., 1968, 387 F.2d 264, a state agency sought to condemn certain property, and the proceedings were removed to federal court. The district court allowed the landowners $5,400 as reasonable compensation for the expenses of consulting geologists, engineers and appraisers, relying on the rationale of Lee. The Fifth Circuit court affirmed the $5,400 award on the basis of Louisiana law, noting that this decision did not “intimate any opinion as to what the rights of these property owners might be in this regard under the Fourteenth Amendment.” Id. at 267. Lee was cited for the proposition that just compensation depends on the facts of each particular case in both United States v. 161.99 Acres of Land, 5 Cir., 1975, 512 F.2d 65, 66, and Porter v. United States, 5 Cir., 1973, 473 F.2d 1329, 1334.
In United States v. 71.29 Acres of Land, W.D. La., 1974, 376 F.Supp. 1221, 1227, the district court allowed compensation for “costs, fees, and expenses paid to independent, professional appraisers,” relying on Lee and Henning. The district court noted the Lee court’s emphasis on the role of equitable considerations in determining the appropriate amount of just compensation. Id.
. J. W. Bowen, an appraiser who testified for the Government, admitted that “[t]his type of property, and by virtue of its size, sir, is almost
. United States v. 4.18 Acres of Land, 9 Cir., 1976, 542 F.2d 786, and other cases relied on by the Government, are not to the contrary. In 4.18 Acres of Land, the Ninth Circuit rejected the landowners’ demand for attorneys’ fees and expenses. No specific reference was made to appraisal fees, and therefore the court’s references to the policy of not encouraging litigation must, therefore, be viewed in light of the fact that attorney’s fees and expenses were the issue in that case.
. The Henning court relied on Kirby Lumber Corp. v. Louisiana, 5 Cir., 1961, 293 F.2d 82, where the court flatly stated that expert witness fees “are never allowed in condemnation cases in Federal Courts.” Id. at 87. Nevertheless, Henning allowed expert witness fees in a condemnation case. The Henning court observed that the Louisiana Supreme Court had held expert witness fees to be part of just compensation under the Louisiana Constitution. The court in Henning concluded that this was a substantive requirement of Louisiana law, and that the federal court was bound to apply the state law. Insofar as Henning applies state law to a state condemnation, it is directly at odds with the terse comment in Kirby Lumber that expert witness fees cannot be recovered in federal courts, as Kirby Lumber was also a Louisiana state condemnation case. In any event, neither case is dispositive on the issue of federal constitutional law that is presently before us.
Concurring in Part
concurring in part and dissenting in part:
Although I concur in all other parts of the court’s decision, I cannot agree that the condemnee is entitled to recover the amount expended for an appraisal of its land as a part of just compensation. The majority bases its decision largely on United States v. Lee, 360 F.2d 449 (5th Cir. 1966). In reaching a contrary conclusion, I need not disagree with that decision. Rather, I would limit its application narrowly to the peculiar facts which I think led the court to reach its result in that case. As the majority has noted, the circumstances
The facts before us are wholly different. What we have here is the rather typical, oft-recurring situation where the landowner is dissatisfied with the Government’s valuation, employs an expert to appraise his land, and then utilizes the appraiser as an expert witness in litigation for the purpose of attempting to persuade the court to increase the Government’s valuation of the property. The majority recognizes that the fee paid the appraiser as an expert witness is not recoverable and has reversed the district court on that point. Nevertheless, the majority separates the appraisal fee from the other amounts paid the appraiser, classifies the fee as a non-litigation expense, and declares that it is recoverable as a part of just compensation. In my opinion, the distinction is untenable. The fee paid for the appraisal is an integral part of the litigation expenses as fully as services performed by an attorney in preparation for a trial, or the examination of books and records by an accountant in preparation for his testimony in court on accounting issues. Yet, I feel confident that the majority would readily agree that no part of the attorney’s or accountant's fees would be recoverable in a Federal condemnation action.
Ever since the Supreme Court handed down its decision in Dohany v. Rogers, 281 U.S. 362, 50 S.Ct. 299, 74 L.Ed. 904 (1930), this court and other courts have held that attorneys’ fees and other expenses incurred by the condemnee are not embraced within the concept of “just compensation for land taken by eminent domain.” United States v. 2,353.28 Acres of Land, etc., State of Fla., 414 F.2d 965, 972 (5th Cir. 1969). In the absence of an authorizing statute, courts may not award a judgment against the United States for costs or other litigation expenses. United States v. Worley, 281 U.S. 339, 344, 50 S.Ct. 291, 74 L.Ed. 887 (1930); United States v. 23.94 Acres of Land, Floyd Co., Com. of Va., 325 F.Supp. 330 (W.D.Va. 1970).
There is ample authority for the proposition that the 1966 amendment of 28 U.S.C. § 2412 which authorizes the awarding of costs to the prevailing party in litigation involving the United States, is not applicable in condemnation proceedings. United States ex rel. T. V. A. v. Easement & Right-of-Way, 452 F.2d 729 (6th Cir. 1971), and cases cited therein. No contention to the contrary has been made in this case. Henning v. Lake Charles Harbor and Terminal District, 387 F.2d 264 (5th Cir. 1968), relied upon by the condemnee, is obviously inapposite. It involves a state condemnation action and the application of Louisiana law, which authorizes the recovery of appraisal fees as costs, rather than as a part of just compensation, in such actions. United States v. 71.29 Acres of Land, 376 F.Supp. 1221 (W.D.La. 1974), also relied on by the condemnee, is a Federal condemnation case. The court there based its decision on and quoted from Henning, and declared that the landowners were entitled to recover the fees paid to appraisers as costs “especially under the applicable Louisiana law, as followed by the Fifth Circuit [in Henning] relative to taking of Louisiana property.” Thus the district court, in following Henning, treated the fees paid the appraisers as litigation costs and permitted the landowners to recover such costs by applying Louisiana law rather than Federal law.
When section 304 of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, 42 U.S.C. § 4654(a) was enacted, Congress made an exception to the long-established rule that the appraisal fees and other expenses incurred by the owner because of condemnation proceedings may not be included in an award against the United States. The statute, Pub.L. 91-646, provides that reimbursement
(1) The final judgment is that the Federal agency cannot acquire the real property by condemnation or,
(2) The proceeding is abandoned by the United States.
Neither of these conditions is met in this case.
As the Ninth Circuit has explained in United States v. 4.18 Acres of Land, etc., 542 F.2d 786, 788 (1976), Congress intended that section 4654(a) should be construed as creating only a narrow exception to the general rule which forbids the recovery of appraisal fees and expenses incurred by the owner, it being the purpose of Congress to discourage litigation in Federal condemnation proceedings. This holding is supported by the following statement in H.Rep. 91-1656, 91st Cong. 2d Sess., (3 U.S.Code Cong, and Admin.News, p. 5875 (1970)):
Ordinarily the Government should not be required to pay expenses incurred by property owners in connection with condemnation proceedings. The invitation to increased litigation is evident.
The majority has emphasized the fact that on account of its size, it was very difficult to appraise the value of the property taken on the basis of available market data. This is not an unusual situation. It is common knowledge that in many condemnation cases, there have been no recent sales of comparable properties. Other methods, including the use of expert testimony, must be used frequently to ascertain the fair market value.
Under the court’s holding today, when a condemnation proceeding is hereafter instituted in the Fifth Circuit, the condemnee may employ an expert to appraise his land, utilize the appraiser as an expert witness in litigating the valuation issue, and if no market data on sales of comparable property are available, he may recover the fee paid for the appraisal as an element of just compensation. In my opinion, such a result is contrary to the rule which the courts have followed since Dohany v. Rogers, supra, was handed down by the Supreme Court and is also in direct conflict with what Congress intended when it enacted Pub.L. 91-646, now codified as 42 U.S.C. § 4654(a).
Reference
- Full Case Name
- UNITED STATES of America, Cross-Appellee v. 1,380.09 ACRES OF LAND, MORE OR LESS, SITUATED IN CALDWELL PARISH, STATE OF LOUISIANA and unknown owners, Bodcaw Company
- Cited By
- 1 case
- Status
- Published