No. 14377
I N THE SUP- C W O THE STATE O I'XNI'ANA
O F F
1979
OSCAR-, Rm-lmDw.
J S P S l AND
O E H CJ -I
P l a i n t i f f s and Respondents,
THE FEDERAL LAND BANK O SPOKANE,
F
(xmmcl3 F. BIEHL, BExTY A. BIEHL,
JEBwExw E. m s rn J N T L. LEWIS,
A E
Defendants and Appellants.
Appeal f m : District Court of the Fourteenth Judicial District,
Honorable Nat Allen, Judge presiding.
Counsel of Record:
For Appellants:
Ask and Pratt, Roundup, Mntana
Thomas M. Ask argued, Roundup, Montana
For Respondents:
Conrad B. Fredricks argued, Big Timber, Mntana
Fredricks and Josephson, Big Timber, bbntana
s-tted: March 21, 1979
Decided: -&'R 2 4 1979
Filed: W 2 4 1979
R
Mr. Chief Justice Frank I. Haswell delivered the Opinion of
the Court.
In an action to condemn a private road, defendants appeal
from an order of the District Court of Golden Valley County,
granting plaintiffs' motion to tax costs and striking an expert
appraiser's fee and attorney fees from defendants' memorandum of
costs.
Plaintiffs brought an action to condemn a private road
connecting their land to a county road, pursuant to section 93-
9923, R.C.M. 1947, now section 70-30-107 MCA. At the time of
this action, the statute appeared in the chapter of the 1947
Montana Code entitled "Eminent Domain". It provides as follows:
"Private roads may be opened in the manner pre-
scribed by this chapter, but in every case the
necessity of the road, and the amount of all
damage to be sustained by the opening thereof
shall be first determined by a jury, and such
amount, together with the expenses of the pro-
ceeding, shall be paid by the person to be
benefited. " (Emphasis added. )
A jury trial was held on May 8, 1978. The jury found
that the private road was necessary and awarded damages to de-
fendants totaling $9,226. Defendants thereafter filed a memo-
randum of costs and disbursements which included a $775 expert
appraiser fee and $2,550 in attorney fees.
Plaintiffs filed a motion to tax costs contending that
appraiser's fees and attorney fees are not part of "the expenses
of the proceeding" within the meaning of the statute.
The District Court granted plaintiffs' motion and ordered
that the expert witness fees and the attorney fees be stricken
from the memorandum of costs. Defendants appeal.
The only issue in this appeal is whether expert appraiser
fees and attorney fees are "expenses of the proceeding" to be
paid by the condemnor in an action brought under section 93-9923,
R.C.M. 1947, now section 70-30-107 MCA.
Plaintiffs argue that this appeal is controlled by our
decision in Tomten v Thomas (1951), 125 Mont. 159, 232 P.2d
.
723, 26 ALR2d 1285. Tomten held that the word "expenses" in
the phrase "expenses of the proceeding" in section 93-9923
was synonymous with the word "costs". Citing numerous author-
ities that in the absence of statute or agreement the word
"costs" does not include attorney fees, Tomten concluded that
neither did the synonym "expenses" include attorney fees. An
order of the District Court striking that item from the condemnee's
bill of costs was affirmed. Two justices dissented, conceding
that attorney fees are not part of the taxable costs in the
absence of statute or agreement authorizing them, but disputing
the majority's conclusion that "expenses of the proceeding" meant
the same as "costs".
Defendants argue that Tomten is no longer controlling
because the 1972 Montana Constitution and two recently enacted
statutes provide for an award of attorney fees and expert witness
fees in condemnation proceedings. The 1972 Montana Constitution,
Art. 11, 529 provides:
"Eminent domain. Private property shall not be
taken or damaged for public use without just
compensation to the full extent of the loss
having been first made to or paid into court for
the owner. In the event of litigation, just com-
pensation shall include necessary expenses of
litigation to be awarded by the court when the
private property owner prevails." (Emphasis added.
Section 93-9921.1, R.C.M. 1947, now section 70-30-305 MCA,
provides :
"The condemnor, shall within 30 days after an appeal
is perfected from the commissioner's award or report,
submit to condemnee a written final offer of judgment
for the property to be condemned, together with neces-
sary expenses of condemnee then accrued. If at any
time prior to 10 days before trial the condemnee serves
written notice that the offer is accepted, either
party may then file the offer and notice of acceptance,
together with proof of service thereof and thereupon
judgment shall be entered. An offer not accepted
shall be deemed withdrawn and evidence thereof is not
admissible at the trial except in a proceeding to deter-
mine costs. The fact that an offer is made but not
accepted does not preclude a subsequent offer.
"In the event of litigation, and when the private
property owner prevails, by receiving an award in
excess of the final offer of the condemnor, the
court shall award necessary expenses of litigation
to the condemnee."
Section 93-9921.2, R.C.M. 1947, now section 70-30-306 MCA,
provides in pertinent part:
"(1) Necessary expenses of litigation as authorized
by 70-30-305 mean reasonable and necessary attorney
fees, expert witness fees, exhibit costs, and court
costs. '
I
Defendants contend that since the code chapter on eminent
domain now includes a definition of "necessary expenses of liti-
gation" which includes attorney fees and expert witness fees, there-
f o "expenses of the proceedings" under the statute here involved,
~
which is a part of the same chapter in the code, also includes
those items.
Plaintiffs urge that these statutes have no application
to this case. They argue that the reference in the statutes to
a commissioner's award or report and a r'inal written offer limits
the applicability of the statutes to actions brought under the
general procedures for eminent domain, t~hichare different from
the procedures followed in actions to open private roads under
section 93-9923. Flaintiffs also maintain that the above cited
constitutional provision is not self-executing.
In ordinary eminent domain proceedings under our statu-
tory scheme, a panel of commissioners is appointed to recommend
the amount of compensation condernnees should receive. Sections
93-9901 et seq., R.C.M. 1947, now sections 70-30-101 et seq. MCA.
If the condemnee is dissatisfied with the recommended amount he
may appeal to the District Court. It is then that section 93-
9921.1, R.C.M. 1947, now section 70-30-305 MCA,comes into play and
the condemnor makes a final written offer. If the final offer
is rejected, the matter goes to trial and only if the condemnee is
awarded a sum in excess of the final offer of the condemnor is
the condemnee entitled to recover the riecessary expenses of
litigation.
The foregoing statutory scheme does not apply to actions
brought under section 93-9923 for the opening of private roads.
In such cases litigation occurs in every instance because the
statute directs that the necessity of the road and the amount
of compensation are to be determined by a jury. Plaintiffs argue
that the new statutes awarding attorney fees and expert witness
fees in the event of litigation are limited to ordinary eminent
domain actions and have no application to section 93-9923 cases.
Therefore, plaintiffs conclude, Tomten still controls and the
court's order striking the appraiser fees and attorney fees from
defendants' memorandum of costs must be affirmed.
From the plain import of sections 93-9921.1 and 93-9921.2
it does not appear that actions brought under section 93-9923 fall
within their purview. Thus, if we accept the reasoning in Tomten,
a decision in favor of plaintiff is compelled. In our opinion,
however, the holding in Tomten was error. We specifically over-
rule that holding.
The essence of the holding in Tomten was that the term
"expenses of the proceeding" is synonymous with "costs". This
conclusion was based primarily on two Washington cases: Fiorito
v. Goerig (1947), 27 Wash.2d 615, 179 P.2d 316; and Chapin v.
Collard (1948), 29 Wash.2d 788, 189 P.2d 642.
Fiorito held that attorney fees and accountant fees are
not part of the costs of an action for an accounting of funds of
a joint venture or partnership so as to permit recovery of those
items by the plaintiff against the partnership or joint venture.
Chapin held that accountant fees and attorney fees were not "costs"
within the meaning of the Declaratory Judgments Act.
These cases simply hold attorney fees are not taxable
as "costs" of the proceeding under general costs statutes or
under specific statutes relating to the particular areas of
law which the cases concern. They do not support the proposi-
tion for which they were cited in Tomten; viz., that "expenses
of the proceeding" in section 93-9923 condemnation actions are
synonymous with and limited to "costs" as the latter term is
ordinarily used.
In our view the reasoning of the dissent in Tomten
states the better rule. Justice Angstman reasoned "it was
clear from the Constitution and statutes that a person who had
his property taken from him against his will should be indemni-
fied for expenses incurred in resisting the condemnation proceed-
ings or in the proceedings for ascertaining the compensation to
be paid, and that actually attorneys' fees are an expense in such
proceedings and quite often, if not always, the principle item
of expenses; also, that the framers of the constitution clearly
contemplated that the expenses of a condemnation suit included
the principal item of expense, namely attorneys' fees." 26 ALR2d
1295, 1298.
We recognize that in overruling Tomten we are reversing
one of the seminal decisions on the exclusion of attorney fees
and expert witness fees as expenses in condemnation proceedings
and departing from a long line of cases that relied on its con-
clusion. 26 ALR2d 1295. Nonetheless, our re-examination of
Tomten convinces us that it is fundamentally unsound. This is
particularly so in light of the new statutory provision provid-
ing for an award to the condemnee of attorney fees and expert
witness fees as "necessary expenses of litigation" in every other
type of condemnation proceeding.
It has been held in some jurisdictions that even though
attorney fees are provided for by statute in all other condemnation
proceedings, they are justifiably disallowed in a proceed-
ing between private parties to establish a way of necessity
because such private actions do not implicate the sovereign
power of eminent domain in the same way as the taking of land
by the state, e.g. Estate of Hampton v. Fairchild-Fla. Const.
Co. (Fla. 1977), 341 So.2d 759. The rationale of such hold-
ings is that in the case of the state taking private property
there is an imbalance between the resources available to the
parties which should be redressed by requiring the state to bear
full financial burden of the individual whose property is being
condemned, whereas in the case of a private road opening where
two private parties are involved the imbalance is not present.
Excerpts from the transcript of the Montana Constitutional Con-
vention Vol. VII, pages 5631-5633, indicate that this imbalance
underlay the adoption of Article 11, 829, 1972 Montana Constitu-
tion.
Be that as it may we conclude that there was no intent on
the part of the framers of the Constitution or the legislature
to deny condemnees under section 93-9923 recovery of attorney
fees and expert witness fees as "expenses of the proceedings"
while all other condemnees are allowed those items as "necessary
expenses of litigation". Denial of attorney fees and expert
witness fees in section 93-9923 actions is most unjust in our
view and not intended by either the Constitutional Convention
or the Legislature. Tomten resulted in an award of $250 in
damages to defendants but denied them the $750 in attorney fees
they incurred through the statutorily mandated procedure, leav-
ing them with the loss of their land, compounded by an additional
monetary loss. We hold, therefore, that the term "expenses of the
proceeding" in section 93-9923 includes expert witness fees and
attorney fees.
We note that we recently cited Tomten for the proposition
that "costs do not include attorney fees." Higgins v. Montana
Hotel Corporation (1979), Mont .
-
1 -P.2d , 36 St.
Rep. 531, 535. This holding remains undisturbed. Here we do
not hold that "costs" include attorney fees but merely that
"expenses of the proceeding" include attorney fees and witness
fees under the statutes here involved.
The order of the District Court striking the appraiser
fees, and the attorney fees from defendants' memorandum of costs
is reversed. The cause is remanded to the District Court for
a hearing to determine the reasonableness of the amounts requested.
Each party shall bear his own costs and attorney fees in this
appeal.
Chief Justice