Summary
In Hard, the Supreme Court reiterated that the requirement of the Georgia Constitution for payment of just and adequate compensation for private property condemned for public use mandates that such compensation cover the value of the property at the time of its taking.
Summary of this case from Zone Enterprises, Inc. v. Geo. L. Smith II Georgia World Congress Center AuthorityOpinion
21930.
ARGUED MAY 14, 1963.
DECIDED MAY 29, 1963. REHEARING DENIED JUNE 10, 1963.
Certiorari to the Court of Appeals of Georgia — 106 Ga. App. 854 ( 128 S.E.2d 533).
Hurt, Baird Peek, J. Corbett Peek, Jr., for plaintiff in error.
David H. Gambrell, Charles Kirbo, King Spalding, Charles L. Gowen, John Izard, R. Byron Attridge, contra.
Wm. G. Grant, Robert L. Spears, Heyman, Abram, Young, Hicks Maloof, Eugene Cook, Attorney General, Carter Goode, E. J. Summerour, Assistant Attorneys General, Harold Sheats, Standish Thompson, R. M. Reed, Edward B. Liles, B. N. Nightingale, for parties at interest not parties to record.
Obedience to the command of Art. I, Sec. III, Par. I of the Constitution ( Code Ann. § 2-301; Const. of 1945) demands that when private land is taken for public purposes, the value of such land at the time of taking must be paid, and that evidence showing an enhancement in its value resulting from the previously announced intention of the condemnor to take an area which includes the subject land for urban renewal is admissible, and it was not error to charge the jury to consider such evidence in fixing its value.
ARGUED MAY 14, 1963 — DECIDED MAY 29, 1963 — REHEARING DENIED JUNE 10, 1963.
By writ of certiorari to the Court of Appeals this court has for review the rulings and the judgment of that court that a charge of the lower court was error which, in substance, instructed the jury that the owner of land taken for public use can recover therefor an enhanced value which it had acquired merely by reason of the taking or as a result of the improvement which the taking of that particular land for the specific purposes for which it is taken contemplates. This case was reported in the Court of Appeals in Housing Authority of the City of Atlanta v. Hard, 106 Ga. App. 854 ( 128 S.E.2d 533). Exception is taken to the rulings and the judgment of the Court of Appeals in their entirety. The application for the grant of the writ in particular points out the following erroneous rulings of law and fact which the applicant complains of which we summarize here: (1) "In such a case no matter what improvements the condemnor contemplated putting on the land, they could not cause a rise in the value of the area." (Direct ruling of the court.) (2) "Only the elements involved before the announced proposal to condemn could be used in determining value." (Direct ruling of the court.) (3) Upon the announcement by a condemning authority that certain property is to be condemned, the property, as a matter of law, ceases to have any value except as to the condemning authority and the value is to be determined and the value to be paid is to be established without reference to elements generally affecting market value, and particularly without reference to events transpiring in the period from the time of the announcement of the taking until the date that the property is actually taken, the market value to be determined as of the date of the announcement rather than as of the date of the actual taking. (Alleged meaning of the ruling by the court summarized by the applicant.) (4) The Court of Appeals erroneously misconstrued, misapplied and failed to follow controlling opinions of this court found in this regard in Central Ga. Power Co. v. Mays, 137 Ga. 120 ( 72 S.E. 900); and Gate City Terminal Co. v. Thrower, 136 Ga. 456 ( 71 S.E. 903), in which this court has held that the owner of land taken for public use is entitled to have the jury take into consideration any enhancement of the value of land which it has acquired by reason of the taking or proposed taking, or as a result of the anticipated improvements to be placed on the property. (5) The Court of Appeals has refused to follow other well-established rules found in the opinions of the Supreme Court and the Court of Appeals, and in the Constitution of Georgia, Art. I, Sec. III, Par. I ( Code Ann. § 2-301) and Art. I, Sec. I, Par. II ( Code Ann. § 2-102), that when private property is condemned for public use the owner is entitled to receive just and adequate compensation as of the date of the taking and not as of the date of the announcement of the taking, and the value of the property should be fixed at the time of its taking. (6) The Court of Appeals has failed to follow the principle of stare decisis in refusing to follow its own decision in the case of Housing Authority of the City of Marietta v. York, 106 Ga. App. 41 ( 126 S.E.2d 246), by failing to follow the principle of law announced in that case or in overruling it.
As shown by the record the evidence discloses that the market for land in the area has been stagnant for a number of years because of the proposed threat of condemnation; but because of the building of an expressway creating a perimeter separating this property from other undesirable property, its value has been enhanced; further, the actual taking of the undesirable property under the urban renewal program in the rear of this property has further enhanced its value because of the cleaning up of the area; and the improvements and anticipated improvements, including the use to be made by the condemning authority has increased the value of the entire area, including the value of the property of the condemnee. Under this evidence, the charge and the rulings of the Court of Appeals, we have for review the assignments of error shown above.
The one question for decision is whether or not, upon the trial of a condemnation proceeding on appeal, evidence showing that the value of the subject property has been enhanced, by the general knowledge, for a number of years that a large area, including it, would be taken for urban renewal, and much of the other property has been taken and slums cleared therefrom, is admissible in fixing its value. The demand of the Constitution, Art. I, Sec. III, Par. I, that "just and adequate compensation" be first paid is imperative. Code Ann. § 2-301; Const. of 1945. It means that such payment cover its value at the time of taking.
It would seem that the numerous decisions of this court and the Court of Appeals, including Young v. Harrison, 17 Ga. 30; Young v. Harrison, 21 Ga. 584, 591; Gate City Terminal Co. v. Thrower, 136 Ga. 456 ( 71 S.E. 903); Central Ga. Power Co. v. Cornwell, 141 Ga. 643 ( 81 S.E. 882); Smith v. City of Atlanta, 22 Ga. App. 511 ( 96 S.E. 334); Georgia Power Co. v. Carson, 46 Ga. App. 612 ( 167 S.E. 902); State Highway Bd. v. Shierling, 51 Ga. App. 935 ( 181 S.E. 885); Housing Authority of the City of Dublin v. Curry Realty Co., 86 Ga. App. 527 ( 71 S.E.2d 898); and Housing Authority of the City of Marietta v. York, 106 Ga. App. 41 ( 126 S.E.2d 246); all of which uniformly conform to the Constitution, should put at rest all questions concerning the time and manner of fixing the value of private property when taken for public purposes. But the decision of the Court of Appeals in the present case is a complete departure from its own decisions, as well as the decisions of this court. The Your case, supra, is identical with the instant case. Both involve actions by the respective housing authorities in taking private property for urban renewal. Both involve land included in the urban renewal, and both involve the identical question stated at the beginning of this opinion. There, a charge in the exact language of Gate City Terminal Co. v. Thrower, 136 Ga. 456 (3), supra, was held not to be error. That court now attempts to distinguish that case upon the ground that there, evidence of enhanced value, because of the known plan for including the subject land in the urban renewal, was admitted without objections, while here, there was no such evidence. There is testimony in this record as follows: "And it had affected its value with the tearing out of all the rest of this property, and not knowing what was going in but knowing that it was to be cleaned up and taken up did affect and did increase the value of the entire area." And to the question asked of the same witness on cross examination: "Now it is your testimony, I believe, that the cleaning up of this area and the knowledge that urban renewal was coming through here has increased or improved values, is that what your testimony is?" The answer: "Generally yes." Thus it would appear that the sole basis for the distinction is invalid.
Looking now to what this court has ruled, we consider first Young v. Harrison, 17 Ga. 30 (1) as follows: "Held, that the value and damage, at the time the land was taken, was the thing to be ascertained; but that to discover this, the jury were authorized to look to the prospective value of the property as a bridge site, and to take that into consideration also, in determining what it was then worth." A request to overrule that decision was expressly denied in Gate City Terminal Co. v. Thrower, 136 Ga. 456, supra, at page 467. In Young v. Harrison, 21 Ga. 584, at page 591, it was said: "We would advise that the witnesses be examined, simply and directly as to the whole worth of the land taken from the Harrisons, by the Irwinton Bridge Company, and for all purposes to which it may be appropriated. The witnesses in forming their opinion, have the right to cast over in their mind all the circumstances which should influence them in making the estimate." That means that the witnesses in this case should take into account the purposes for which it may be appropriated, including urban renewal, as well as the circumstances which should influence them in making their estimate, which could properly include the removal of slums and cleaning off the surrounding area.
The Court of Appeals recognized that their ruling was in conflict with Gate City Terminal Co. v. Thrower, 136 Ga. 456, supra, except for the fact that a factual distinction existed. They said there was not in the Thrower case, as is true here, a "particular and identifiable tract of land which it was contemplated would be condemned." There the owner of the subject property instituted injunction proceedings in 1906 to prevent the taking of this property, and the condemnation occurred in 1907, about eight months later. A witness testified that: "In the next twelve months the railroad had done a lot of grading, and I think they owned all but one piece of property around there, and ... that piece was worth $15,000, for Mr. Thrower held the key to the situation. That the railroad had to have that piece of property, is one reason why it was the key to the situation; ..." Another witness testified that: "I thought it possible that the railroad might have to have the property; that entered into the valuation of it; that was one of the points putting a valuation on it." Therefore this particular identifiable tract of land was unquestionably contemplated to be condemned. Hence the attempted distinction is thus shown to be invalid.
Coming now to what was held in Gate City Terminal Co. v. Thrower, 136 Ga. 456, supra, we find it well expressed in headnote 3, which is precisely the charge on which the Court of Appeals reversed this case. It is: "If, at the time the market value of the property sought to be condemned was to be estimated, it was known or anticipated that certain improvements would be made in the locality where the property was situated, and this fact served to enhance the market value of the property, the owner would be entitled to the actual market value as affected by reason of the fact that it was known or anticipated that such improvements would thus be made. This is true though the projected improvements were to be made by the condemning party." There as here the improvements were to be made by the condemned. There as here the subject property was expected to be taken by the condemnor and used in the process of improvement. There as here it was known or contemplated for considerable periods of time before the taking that the particular identifiable property would be taken as a part of the contemplated improvement. In neither case could the owner expect to share in the benefits resulting from the devotion of the property to the public use. At page 466 in the Thrower case, it is said that a witness testified: "The fact that a railroad would come in there and want that property had a splendid effect on that property as to price.'" This evidence was objected to upon the grounds: (1) irrelevancy and that (2) the benefit this property would derive on account of the railroad coming could not be considered as an element in enhancing the value of the property of which the landowner could take advantage against the condemning railroad company. This court ruled: "The testimony above quoted was admissible, and not subject to either of the objections made thereto. The market value of the property on April 20, 1907 [date of taking], was the measure of compensation to be awarded to Thrower. Prior to this time the railroad company `had graded out along side of the property' to be taken. One witness testified: "We knew pretty well where they were going to locate the railroad'." The Thrower case was decided in 1911, and both reviewing courts have recognized it as the established law since that time. In Central Ga. Power Co. v. Cornwell, 141 Ga. 643 (1), supra, where land was taken to construct a dam, and there was evidence showing that the land sought to be taken was valuable not only for agricultural purposes, but because it was peculiarly adapted to and necessary for the development of water power at the shoals of the river, this court held that the evidence authorized the following charge "`In estimating the market value of the property taken for public use, all of the capabilities of the property, and all of the uses to which it may be applied, or for which it is adapted, are to be considered, and not merely the condition it is in at the time and the use to which it is then applied by the owner,'" citing Gate City Terminal Co. v. Thrower, 136 Ga. 456, supra. That ruling requires that evidence showing the property taken adaptable for the use for which the condemnor was taking it admissible in estimating its value. It requires a holding here that the charge allowing evidence that the subject property was adaptable to the use in the urban renewal for which it was taken was not erroneous.
While it might be difficult to see how knowledge of this impending taking of this particular property for urban renewal would enhance its value, yet that is conceivable, and testimony to that effect can not be rejected. Anything that actually enhances the value must be considered in order to meet the demands of the Constitution that the owner be paid before the taking, adequate and just compensation. Since the date for fixing value was after the inclusion of this land in the announced intention to take it, it had no market value except in contemplation of the condemnation award, thus confronting the court with the necessity of either changing the date of valuation as the Court of Appeals did — which is flatly forbidden by the Constitution — or rejecting the standard of market value in favor of a hypothetical value based on the utterly fallacious assumption that it will remain in private ownership adjacent to the improvement; or do as the trial court did, allow proof of any element, including knowledge of the impending urban development, that entered into fixing its value right up to the time it was taken. This latter rule is the only constitutional course open to the court.
A brief filed on behalf of the State quotes extensively from Orgel On Valuation Under Eminent Domain (1953). But it fails to quote as did an opposition brief from Volume 1, page 433, Footnote 16 of the same authority, the following: "In some cases all enhancement in value resulting from the improvement is expressly and unqualified allowed. Gate City Terminal Company versus Thrower, 136 Ga. 456, 71 S.E. 903 (1911), was apparently a case of this kind." Able counsel for the Housing Authority cite numerous cases from other jurisdictions, apparently holding contrary to the Thrower case, and assert that only Georgia has that rule. We have not examined the constitutional provisions of those jurisdictions to determine if they differ from ours, but for the reasons hereinbefore stated, we follow what we conceive to be the rule in Georgia. To such contentions we would reply further by paraphrasing a statement of a great President who once said, "Everybody is against me — everybody except the people," by saying that all the decisions are against what we hold — all except the controlling decisions of the courts of Georgia. On this point in Green v. Coast Line R. Co., 97 Ga. 15, at pages 36 and 37 ( 24 S.E. 814, 33 LRA 806, 54 ASR 379), this court said: "Every direct authority known to us is against us; nevertheless, we are right and these authorities are all wrong, as time and further judicial study of the subject will manifest."
The Court of Appeals erred in holding that the charge excepted to was error.
Judgment reversed. All the Justices concur.