Opinion
No. 31061
Decided March 24, 1948.
Municipal corporations — Assessment of special benefits accruing from widening street — Section 6, Article XIII, Constitution, not limited by Section 19, Article I — Assessment may include cost of other property taken from owner by condemnation — Charge to jury as to damages to residue in condemnation proceeding — Instruction applies only to benefits established by evidence before jury, when.
1. Section 19, Article I of the Constitution of Ohio does not limit or curtail the operation of Section 6, Article XIII of the Constitution, and municipalities are authorized to assess property benefited by the widening of a street for the value of the special benefits accruing to such property from such widening, even though included in such assessment is the cost of other property taken from the owner of property assessed for the purpose of the widening of the street. ( City of Cleveland v. Wick, 18 Ohio St. 303, and paragraph five of the syllabus in State, ex rel. Shafer, v. Otter, County Surveyor, 106 Ohio St. 415, approved and followed.)
2. Where the court in condemnation proceedings instructs the jury that in considering the damage to the residue remaining to the owner after separating the property taken by appropriation, the jury should take into account, in estimating such damage, the special, direct and peculiar benefits resulting to the residue from the proposed improvement and the uses to which the appropriated property are to be put, it will be assumed that such instruction was applied by the jury to only those benefits and uses concerning which there was evidence before the jury. Otherwise the instruction would constitute error.
APPEAL from the Court of Appeals for Hamilton county.
On April 10, 1936, the appellant, The Pickering Hardware Company (hereinafter called Pickering), instituted an action against the city of Cincinnati (hereinafter called the city) and others to enjoin the collection of special assessments which had been levied against Pickering's property by the city for special benefits accruing to such property by the improvement and widening of East Fifth street.
Prior to 1930, Pickering was the owner of property at the southeast corner of Fifth and Main streets, which property fronted 79 feet 6 inches on the easterly side of Main street and extended eastwardly along the southerly line of East Fifth street a distance of 63.26 feet. This property was entirely covered with buildings. At that time East Fifth street, running east from the easterly side of Main street to Pike street, was 66 feet wide.
On or about May 14, 1928, the city filed an application in the Court of Common Pleas of Hamilton county to assess compensation for land appropriated by it for the widening of East Fifth street from the east line of Main street to the west line of Pike street. There was included in the appropriation a parcel of the Pickering tract, which parcel measured 25 feet along the easterly side of Main street and 63.26 feet along the southerly side of East Fifth street.
On December 15, 1931, a jury assessed the compensation to be paid by the city to Pickering as follows: $259,487.75 for the value of the land taken, $89,511.50 for damages to residue, and $149,281.85 for the value of the buildings on the land, or a total of $498,281.10. Neither the city nor Pickering filed a motion for a new trial, and a judgment was entered on the verdict. No appeal was taken by either party.
Thereafter, on September 13, 1933, the city council passed an ordinance levying special assessments on the property benefited by the improvement of East Fifth street from Main street to Pike street by widening the same 25 feet along the south side by appropriating and otherwise acquiring private property for the purpose of making such improvement, by grading, paving the roadway with sheet asphalt on a concrete base, resetting existing curbs, setting new granite curbs and steel plate curbs where necessary, installing drains, inlets and retaining walls where required, making changes in and additions to the water distribution system, installing sewer and water house service branches, reconstructing old cement walks and constructing new cement walks where necessary, and other incidental work.
The ordinance recites the appointment of an estimating board for the purpose of reporting to council an estimated assessment of the property owners' portion of the cost of the improvement, and the appointment of an equalizing board for the purpose of hearing objections by the benefited property owners, and authorized an assessment on Pickering's residue of $22,849.05. The total assessments in the ordinance amounted to $1,008,484.05, which, with the city's portion of the cost amounting to $1,101,715.95, made a total estimated cost of the improvement of $2,110,200. The assessing ordinance provides that each assessment shall be payable in cash on or before the 30th day following the final passage of the ordinance, or in 20 annual installments, with interest on deferred payments at five per cent per annum.
Since Pickering did not pay the assessment, it was certified to the county auditor to be collected in installments as other taxes.
Although the petition alleges that Pickering's property received no special benefit whatever from the improvement of East Fifth street, and that the method used by the estimating board and the equalizing board in arriving at the value of the alleged special benefit to Pickering's property was arbitrary, discriminatory and illegal, those averments were abandoned by a stipulation, entered into between Pickering and the city, as follows:
"That it is agreed and understood between the parties hereto that in the event the legal objections raised by the plaintiff to the assessments levied on its property are not sustained, that the value in money in benefits accruing to plaintiff's property by reason of the improvement of Fifth street between Main street and Sycamore street is a sum equal to 70 per cent of the cash assessment levied and assessed by ordinance No. 224-1933."
In the condemnation proceedings by which a 25-foot strip of Pickering's property was appropriated, the court, at the request of the city, gave to the jury certain special charges as follows:
"No. 1. I charge you that in considering the damage to the residue you may take into account that sum which you consider to be an amount representing the value of the special benefit to the residue and which is specifically applicable to the residue of the property as distinguished from the benefits to the public at large."
"No. 10. In determining the damage to the residue of defendant's tract you will consider the effect thereon of the taking away of the strip sought to be appropriated and its application to the uses proposed, and you will determine how much, if any, its full, fair market value will be impaired by reason of this appropriation. In considering the present market value of this residue you will consider its value as a part and parcel of the entire tract. In considering its value after the appropriation is made you will consider it after the twenty-five foot strip has been appropriated and put to the uses stated by plaintiff in the application."
In a stipulation in the instant case, the trial judge in the condemnation proceedings stated:
"In my general charge to the jury, I instructed the jury * * * that in assessing any damages that may result to such property owners by reason of the appropriation, other than the compensation for the part taken, that it, the jury, will further ascertain how much less valuable the remaining portion of such property will be in consequence of such appropriation. That damage to the residue or remaining portion of defendant's property does not arise because of the taking by the plaintiff but arises only as a result of such taking. That in assessing damages to the residue, if they found the same to have been damaged, they must take into consideration the uses to which the part taken is appropriated or put. That in estimating damages to the residue of the property, the jury must take into consideration the special, direct and peculiar benefits that attach to the remainder of the defendant's land not appropriated, resulting from the proposed improvement, but not the general benefits which the defendants derive in common with the general public from the improvement of East Fifth street between Main and Pike streets. Neither should the jury take into consideration, in estimating damages, if any, to the residue, any inconvenience to which the defendant may be put as are consequences of the lawful and proper use of the land actually appropriated insofar as the same are common with other landowners in the neighborhood or the general public. I instructed the jury that in estimating the damages to the residue it will consider the present market value of the entire tract of land separate and apart from the improvements thereon; the effect, if any thereon, of the taking away of that part appropriated by the plaintiff, and in considering its value after the 25-foot strip is taken therefrom, the value to the residue should be considered when the land as appropriated is put to the uses stated by the plaintiff. In estimating the value of the residue of defendant's property you will take into account that sum which you consider to be an amount representing the value of the special benefit to the residue arising from the improvement, and which is specifically applicable to the residue of the property as distinguished from the benefits to the public at large. The difference in value, if any there be, of the residue as part of the entire tract and the value of the residue after the proposed improvement is completed and put to the stated use, permits a balance to be struck from which you will ascertain if there is a damage to the residue of the defendant's land, and if so, the amount of such damage."
In the instant action, Pickering claims that, because of the giving of such charges in the condemnation proceedings, the jury deducted from the damages to the residue of Pickering's property the total value of the special benefits for which the city assessed the residue of Pickering's property; and, further, as gathered from the statements in Pickering's amendment to the petition, that since the assessment was to pay for land taken from Pickering by the city for the East Fifth street improvement, it would be a taking of Pickering's land without full compensation if Pickering had to partially pay for such taking.
The Common Pleas Court perpetually enjoined the city from collecting or attempting to collect the assessments levied by the city against the property of Pickering.
On appeal on questions of law and fact, the Court of Appeals found that Pickering was not entitled to an order enjoining the entire assessment as prayed for; that Pickering should have the option during 30 days from the entry of the decree of the Court of Appeals to pay the adjusted assessment charges for the years 1937 to 1946, inclusive, plus a sum equal to the present value of the remaining installments, on the adjusted 70 per cent basis, for the years 1947 to 1956; and that, in case of the failure of the plaintiff to make such payment within 30 days, the city shall void the assessment amounts against the premises heretofore certified to the county auditor and certify in lieu thereof the installments against the premises from 1937 to 1956, as adjusted, the installments from 1937 to 1946, inclusive, to be payable at the time of the collection of the 1946 taxes.
The case is before this court on appeal from the decree of the Court of Appeals, a motion to certify the record having been allowed.
Mr. Charles F. Hornberger and Mr. Harry R. Weber, for appellant.
Mr. John D. Ellis and Mr. Henry M. Bruestle, city solicitors, Miss Isabel Guy, Mr. Ed F. Alexander and Mr. Carson Hoy, prosecuting attorney, for appellees.
Section 19, Article I of the Constitution of Ohio states in part:
"Private property shall ever be held inviolate but subservient to the public welfare. * * * where private property shall be taken for public use, a compensation therefor shall first be made in money, or first secured by a deposit of money; and such compensation shall be assessed by a jury, without deduction for benefits to any property of the owner."
Section 6, Article XIII of the Constitution of Ohio states:
"The General Assembly shall provide for the organization of cities, and incorporated villages, by general laws, and restrict their power of taxation, assessment, borrowing money, contracting debts and loaning their credit, so as to prevent the abuse of such power."
In several cases involving the question whether the General Assembly, under the authority of Section 6, Article XIII of the Constitution of Ohio, can authorize a municipality to levy an assessment against an owner of property, a part of whose land has been taken by condemnation for the making of an improvement, for special benefits arising from the improvement, this court has given diametrically different answers.
In 1868, in the case of City of Cleveland v. Wick, 18 Ohio St. 303, this court unanimously held that an assessment, upon lands fronting on a street, to reimburse the amount of compensation paid the owner for his other land taken for the use of the street was authorized by statute and was not in violation of the constitutional provision which guarantees the owners of the land so taken full compensation without deduction for benefits.
In that case, Judge Welch said that the constitutional provision "simply guarantees to the owner of land condemned a full price. When that is paid, he stands on a perfect equality with all other owners of adjoining lands, equally liable, as he ought to be, to be taxed upon his other lands with them. He has the full price of his land in his pocket, and is an equal participant with them in benefits to adjoining lands."
In 1900, in Cincinnati, Lebanon Northern Ry. Co. v. City of Cincinnati, 62 Ohio St. 465, 57 N.E. 229, 49 L.R.A., 566, this court overruled the Wick case, supra, and held that Section 19 of Article I of the Constitution of Ohio is a limitation upon Section 6 of Article XIII as to the power of assessments, and that compensation paid to a landowner for lands taken, by appropriation proceedings, to open a street cannot be assessed back upon the lands of the owner remaining after such taking. Judge Minshall, who concurred in the judgment, did not join in overruling the Wick case because he said the judgment could be justified by the fact that the improvement had not benefited the railroad company against which the assessment was made.
In 1902, in the case of City of Dayton v. Bauman, 66 Ohio St. 379, 64 N.E. 433, this court approved Cincinnati, L. N. Ry. Co. v. City of Cincinnati, supra, and extended its doctrine further by holding that the limitation of Section 19 of Article I of the Constitution on Section 6 of Article XIII, as to assessments, goes to the full extent of prohibiting the raising of money directly or indirectly by assessment to pay compensasation, damages or costs for lands appropriated by the public for public use.
In 1922, in the case of State, ex rel. Shafer, v. Otter, County Surveyor, 106 Ohio St. 415, 140 N.E. 399, this court overruled Cincinnati, L. N. Ry. Co. v. City of Cincinnati, supra, and paragraph one of the syllabus of the case of City of Dayton v. Bauman, supra, and approved and followed the case of City of Cleveland v. Wick, supra.
In the opinion in the Otter case, Judge Robinson said, on page 433:
"On the other hand the doctrine of Cleveland v. Wick, supra, in its practical operation works even-handed justice to all. The property owner under the Constitution receives full compensation for the lands taken without deduction for benefit. He then has parted with his land, and has in its place its value in money, and, as to his remaining lands, he is in exactly the same position as his neighbors. If such remaining lands and the lands of his neighbors receive special benefits, benefits different from and in addition to the benefits which he and his neighbors received as members of the general public, there is, on principle, no reason why such lands should not bear ratably and in proportion to special benefits an assessment therefor."
Thus, under the law of Ohio, according to this court's last declaration and, as we view it, the sounder reasoning, where an owner has been paid the full value of property taken from him by condemnation and his remaining land is specially benefited in the same way as adjoining lands by the improvement made, the municipality has the power to make an assessment for such special benefits even though such assessment covers a part of the cost of the land taken, provided the assessment is not greater than the value of the special benefit.
In the instant case, Pickering contends that the city has already collected from it the value of the special benefit. Pickering's theory is that, because the court in the condemnation proceedings charged the jury as quoted above, the jury must have deducted the value of the special benefits for which the city assessed Pickering from the gross damage to the residue.
Pickering contends that, when the jury in the condemnation proceedings returned its verdict after having been instructed as above set out, the issue as to the value of the special benefits to its residue property was settled and adjudicated, and cites numerous authorities to the effect that if a party accepts the benefit of a judgment he will be estopped to deny its validity and force, and that a party by receiving benefits under a judgment is estopped to deny any of its expressed or implied terms.
There is no quarrel with the authorities cited by Pickering and they would be persuasive if the assumption made by Pickering were correct, to wit, that under the instruction of the court in the condemnation proceedings, the jury did deduct from Pickering's award the amount of the special benefit to Pickering's residue property from the completed East Fifth street.
At the time of the condemnation proceedings, the new East Fifth street had not been built and the record in the instant case does not disclose that there was submitted to the jury in the condemnation proceedings any evidence of the nature, the extent, the cost or value of the benefit of the completed East Fifth street upon contiguous property. The only thing which the record in the instant case discloses to have been before the jury in the condemnation proceedings was the fact that the north 25 feet of Pickering's property was being taken to widen East Fifth street. There was no guarantee to Pickering in the condemnation proceedings that the city would complete any plans for further widening beyond the limits of Pickering's property, or as to the nature, quality and cost of any new street, the kind of sidewalks that would be put in or the drainage and other sanitary arrangements. There were no facts before the jury in the condemnation proceedings by which it could evaluate the special benefit to accrue to the residue of Pickering's property by the kind of East Fifth street which finally evolved.
Therefore, it would seem that when the court instructed the jury in the condemnation proceedings to take into account the sum which the jury considered to be an amount representing the special benefit to the residue and specifically applicable to the residue, it must have meant, and the jury must have understood it to mean, something different from the special benefit of the completed East Fifth street because such special benefit from the completed East Fifth street was impossible to estimate at that time without indulging in mere guesswork and speculation.
Since the record in the instant case discloses no evidence before the jury in the condemnation proceedings with reference to the completed street, what was there before such jury to justify the court's instruction?
The application was for appropriation of a part of Pickering's property for the widening of East Fifth street, so that Pickering knew and the jury knew that the property which would remain in Pickering's ownership would still be a corner lot and would have as to it an East Fifth street 25 feet wider than the one along side the original lot. For example, if the city had appropriated the same 25 feet of Pickering's property for a firehouse, a police station or other public building, that would have meant that Pickering's residue would no longer be a corner lot, would be deprived of light and air, and in such case it is obvious that the damage to the residue by the taking away of the corner would be much greater than the appropriation for widening of East Fifth street which left the residue a corner lot. That must have been the special benefit which the court had in mind in its special charges to the jury in the condemnation proceedings because that matter was before the jury and was not the subject of speculation and guesswork. Upon any other hypothesis, the instructions of the court would have been erroneous as applicable to elements of the case without evidence to support them and Pickering's remedy for any prejudice to it would have been an appeal.
Pickering was paid the full value of its 25 feet taken, namely, more than $259,000. It was paid the full value of its buildings on its original lot, namely, more than $149,000. It still retained its residue lot, 54 feet 6 inches on Main street by 63.26 feet on East Fifth street, but received as damages to that residue, because of the 25 feet being separated from it, more than $89,000. This residue lot remains a corner lot, and the magnificent East Fifth street upon which it abuts has specially benefited this residue lot in the same way that it has benefited all the rest, not only the abutting property but contingous property a long distance from the site of the improvement, which is included within the assessment district. As we have said, the amount of special benefit has been stipulated between the city and Pickering in the event it is found that Pickering has not already paid for the special benefit conferred on its property by the completed East Fifth street.
The condemnation proceedings were concluded and Pickering had in its possession the money representing the value of its land taken, the full value of its buildings upon that land and the full value of the damage to its residue property as found by the jury after taking into consideration the special benefits accruing to the residue at the time the jury made its award. Values at the time of the condemnation proceedings are those which are applicable. See Miami Conservancy District v. Bowers, 100 Ohio St. 317, 125 N.E. 876.
We hold that under the undisputed facts in this case the city has not been paid by Pickering for the special benefits accruing to its property by reason of the completed, improved East Fifth street, and that Pickering is not entitled to have the collection of the assessment against it enjoined.
A question has arisen with reference to a matter of interest. It is contended by Pickering that, in the event the assessment against it should be sustained, it should have an opportunity to pay in cash and be relieved of all interest.
When the assessments were originally made in 1933, it was provided that, in case they were not paid in cash within 30 days of the passage of the assessment ordinance, they should be paid in 20 equal annual installments, with interest at the rate of five per cent per annum on the deferred payments. Pickering did not pay in cash and its assessment was certified to the county auditor for payment in installments. Thereafter the city, in other cases, agreed to settle for 70 per cent of the amount of the installments and fixed the installment payments over a period of 20 years from 1937.
After the Court of Appeals made its entry validating the 70 per cent assessment against Pickering, the court gave the privilege to Pickering to pay, during the period of 30 days following the entry, the sum of the adjusted-assessment installments for the years 1937 to 1946, inclusive, plus the present value of the remaining installments of assessments as authorized in the years from 1947 to 1956, inclusive, and ordered that, in case of failure to make such payment within the 30 days, the city should void the 1933 assessment amounts previously certified against Pickering and should be authorized, in lieu thereof, to certify the adjusted installments of payments from 1937 to 1956, inclusive, to the county auditor for collection according to law, the installments from 1931 to 1946, inclusive, to be payable at the time of collection of the 1946 taxes.
The action of the Court of Appeals in the exercise of its equitable powers was fair and generous. Pickering has as yet paid out no money upon its assessment and has had the money due from it in its possession. It is now relieved from any interest from 1934 to 1937; and as to the interest from 1937 on, Pickering is in the same position as all the other property owners who have been assessed for the special benefits from the completed East Fifth street.
This court held in Gest v. City of Cincinnati, 26 Ohio St. 275, that where assessment proceedings are found defective, in ordering the amount properly chargeable against the lot owner, interest may be allowed from the time fixed for the payment of the assessment.
The order of the Court of Appeals with reference to interest was certainly not erroneous as against Pickering.
The decree of the Court of Appeals is affirmed.
Decree affirmed.
WEYGANDT, C.J., TURNER, MATTHIAS, HURT, ZIMMERMAN and SOHNGEN, JJ., concur.