United States v. Twin City Power Company of Georgia, Twin City Power Company of Georgia v. United States

TUTTLE, Circuit Judge

(dissenting).

Believing as I do that the Court has applied the wrong standard controlling our review of the judgment of the District Court, I respectfully dissent.

Added to the usual disinclination to dissent from my colleagues constituting a majority of the Court, I find a further reluctance from the fact that the Court of Appeals of the Fourth Circuit, whose opinion is stated to be at least a partial basis of the opinion of the majority here, has adopted the view of the law with *206which I find myself in disagreement. Moreover, in disagreeing with the Fourth Circuit, I fully appreciate that if my views were adopted by this Court there would be, subject of course to review by the Supreme Court, a difference in standard of valuation and a very substantial difference in the amount paid per acre for lands involved in the same condemnation area merely by reason of their lying in two different judicial circuits. I feel, however, that what I consider to be an error in the standard of appeal adopted by the Fourth Circuit and by this Court is of such importance in the field of condemnation that I am constrained to state the reasons for my disagreement.

The opinion of the majority states the questions to be: (1) Whether the district court applied the proper standard in considering the findings; (2) whether it erred in rejecting the findings of the commission as clearly erroneous; and (3) whether, in turn, the findings made by the district court are clearly erroneous. I think the first two questions merge, for if the district court (1) applied the proper standards then it (2) did not err in rejecting them, and vice versa. As to (3) I agree that if the district court could legally set aside the findings on the record before it, then, as to its own valuation, substituted for them, it is protected by the clearly erroneous rule and we would probably be compelled to affirm, although I think it is strongly against the weight of the evidence.

I think the question can be put more simply as follows:

Where, in condemnation proceedings, commissioners are appointed by the district court under Rule 71(A) (h) and the Commission makes a finding of valuation of lands taken, which valuation is later set aside by the district court as being clearly erroneous, does the Court of Appeals review the action of the commission to ascertain whether its valuation was clearly erroneous or does it review the judgment of the district court to ascertain whether his order setting aside the commission’s findings and the findings substituted by him for those of the commission are clearly erroneous?

Although the opinion of the majority does say “we cannot say that the district court erred in rejecting the commission’s findings as clearly erroneous,” I think it clear that the court was not prepared to say “we think the commission’s findings were clearly erroneous and we would set them aside.” I think that unless this court can say that, then the language used by the majority attributes to the fact that the trial court acted in the matter some added but unexplained nebulous ingredient to the standard which we apply to our appeal here. I find no basis in law or logic for such proposition unless all it means is that we are" to consider the fact that the trial court in effect expressed the legal opinion that it had the right to do what it did. It seems to me that the court means something more than that, but just what it is the opinion fails to say.

The opinion of the majority approves the holding of the Fourth Circuit where it is held:

“We review the District Judge, not the commissioners; and under Rule 52(a) we may not set aside his findings unless they are clearly erroneous.”

I think this is contrary to the otherwise unbroken line of authorities of the federal appellate courts that have had to deal with this subject.

All parties agree that the scope of review by this Court is the same as exists-when a district judge overrules findings-of fact by a master or a referee in bankruptcy. We need not look beyond our own Circuit to find an authoritative decision as to our scope of review in such a situation. In Phillips v. Baker, 5 Cir., 165 F.2d 578, 581, this Court, speaking-through Chief Judge Hutcheson, said"

“The duty to determine whether the referee’s findings 'must be accepted’ and whether the district judge has erred in not accepting *207them is not the district judge’s but ours.”1

I think that Anderson v. Mt. Clemens Pottery Company, 328 U.S. 680, 66 S.Ct. 1187, 1193, 90 L.Ed. 1515, establishes this proposition too clearly for question. The court there said:

“Our examination of the record leads us to acquiesce in these findings [of the master] since they are supported by substantial evidence and are not clearly erroneous and the court below [the Court of Appeals] correctly held that the District Court erred in failing to accept these findings and in creating a formula of compensation based upon a contrary view.” 328 U.S. 680, 689, 66 S.Ct. 1187.

The Courts of Appeals of other circuits have expressed the same principle. As for instance in the Eighth Circuit it was stated in Sanitary Farm Dairies v. Gammel, 195 F.2d 106, 118, as follows:

“Opposite factual views might perhaps with equal right have been capable of being reached on the evidence and might have been required to be sustained by us, had they constituted initial determination in judicial administration. But here it was the master and not the court which was the initial fact appraiser, and the court could not, under rule 53(e) (2), Federal Rules of Civil Procedure, 28 U.S.C.A., refuse to recognize the master’s findings or escape the conclusion to which they led, merely because of a difference in personal persuasion on the evidence or a dissatisfaction with the result reached.”

See also Krinsley v. United Artists Corp., 7 Cir., 225 F.2d 579, and Ferroline Corp. v. General Aniline & Film Corp., 7 Cir., 207 F.2d 912, at page 920, where the Court of Appeals said:

“The threshhold question here then is the same as it was in the court below, — whether, as a matter of law, the master’s findings of fact were clearly erroneous.”

And see Morris Plan Industrial Bank v. Henderson, 2 Cir., 131 F.2d 975, 976, 977, quoted supra in the opinion of the majority.

It is clear to me from reading the opinion of the Court that it does not intend to state categorically the valuation found by the commissioners was clearly erroneous. The nearest approach to such a statement is the Court’s comment:

“We cannot say that the district court erred in rejecting the commission’s findings as clearly erroneous, or that the findings of the district court are themselves clearly erroneous.”

In light of the acceptance of the Fourth Circuit’s view that the judgment of the trial court is itself protected by the clearly erroneous rule, this does not, it seems, amount to a statement by the court that the commissioners’ findings were clearly erroneous. I can sympathize with the majority’s refusal to hold that the Commission’s findings are clearly erroneous. Such a holding on a record as replete with supporting evidence as this would come back to haunt us in every future case in which a litigant seeks a reversal of the findings of a trial court. In my opinion it would make a meaningless phrase out of the clearly erroneous doctrine. I think on the record which was the basis of the commission’s findings, neither the district court nor we could legally hold their valuation clearly erroneous, and that therefore the judgment arrived at by the district court “by creating a formula of compensation based upon a contrary view,” to use the language of the Supreme Court in the Mt. Clemens Pottery Company case, was wrong and must be reversed. It seems to me clear beyond doubt that viewing this Court as having the duty to approve the valuation found by the commission, unless clearly erroneous, we could not conceivably make such a finding on the record before us.

*208There were four witnesses for the Government, all of whom were found by the commission to be competent appraisers and all of whom testified that the land was worth substantially less than the valuation arrived at by the commission. Without attempting to detail the entire testimony, it seems to me sufficient, in order to demonstrate the substantiality of this evidence, to comment briefly on some of the testimony. One of the witnesses, Ward, testified that he had been born and raised in the county in which most of the land lies, that he had bought and sold land in the very tracts involved, that he had cruised it for timber, that he had bought lands much closer to town than the lands here in issue within a reasonable period before the taking at substantially lower prices per acre than his estimate; that he had, for the purpose of this appraisal, inspected two of the tracts.2

Mr. Ward’s testimony, which the commission used primarily as to a basis for its valuation, was to the effect that the lands as to which the commission found “there were no improved roads, no utility lines, no railroads, no bridges, no buildings, and practically no improvements of any nature,” was worth approximately $31 per acre. In his appraisal I think it is clear from the record that in some instances he included some value for standing timber. To the figure testified to by Mr. Ward, the commissioners added some $12,000 for timber on the entire tract and also added $5 per acre which they found to be the value resulting from the assembling of the several tracts. The district judge, after setting aside the finding by the commissioners, found a valuation of approximately $80 per acre.

In addition to Mr. Ward’s testimony there was evidence offered by two Augusta real estate dealers, both of whom testified to their knowledge of the property and of sales in connection with comparable tracts. Their testimony was that the property was worth substantially less than $31 an acre. So too was the evidence given by the Government’s witness, Spencer Cooley, who had spent some four or five years studying the property in this area of condemnation as an appraiser for the Government. His testimony as to value was somewhat lower than Mr. Ward’s and was based on his study of sales of land in the vicinity. In order to arrive at comparable sales he made a study of all of the sales in the area over a period of several years, finally considering 90 separate transfers of title. His testimony was supported finally by four particular sales which he considered most nearly comparable. Obviously, however, the consideration that he would give to all of the other sales in the area was a matter which would go to the weight of his testimony as an expert. All of this material was before the commissioners and properly entered into their appraisal of the worth and weight to be given to the opinions of the experts.

The trial court stated that:

“The most careful appraiser of the land as distinguished from the growing timber was by the witness Henderson. His experience as an appraiser lends weight to his valua.tion. The commissioners described him as a competent land evaluator [as they did also as to all other witnesses]. My observation of Mm as a witness in other condemnation cases leads me to the same conclusion. After a study of all the evidence it is my view that his testimony is entitled to more weight than *209that of the witnesses for the United States.” (Emphasis added.)

This entire statement by the court is in terms of the evaluation of the weight to be given to the testimony of experts. Obviously there is much more to be considered by the tribunal, whose duty it is to make the findings based on such testimony, than a question of credibility in the usual sense. The appearance and plausibility, the apparent frankness and presence of or lack of interest, the degree of understanding of the factors that go into making up a proper basis for valuation, are all things that become apparent to the tribunal that hears and sees the witnesses. A holding by any court that the valuation here arrived at by the commissioners was clearly erroneous in spite of the substantial quality of the evidence would, it seems to me, be contrary to accepted principles on which such findings can be reviewed and set aside. As we have recently stated in Stephens v. United States, infra, in quoting with approval the unreported opinion of the district court whose judgment we affirmed :

“ * * * it was for the Commission to determine the credibility of the witnesses and the weight to be given their testimony. The findings of the Commission have ample support in the evidence and it is not for the Court to substitute any finding that he might make from the evidence for that made by the Commissioner who observed and heard each and every witness testify.”

And also:

“Since the award is within the range of the credited testimony, and the commission was not bound to accept the valuation of any particular witness, we may not re-weigh the evidence in a de novo review or reverse merely because the commission found a valuation more closely based upon the testimony of the Government appraisers than upon that of the landowner’s witnesses.” Stephens v. United States, 5 Cir., 235 F.2d 467, 469, 471.

I think that the trial court erred in setting aside the finding of valuation by the commissioners and that its judgment should be reversed with instructions to enter a judgment for the amounts fixed by the commissioners in their finding.

Rehearing denied: TUTTLE, Circuit Judge, dissenting.

. The entire paragraph from which this quotation is taken is quoted in the majority opinion.

. The district court commented adversely on the fact that before he personally inspected the other tracts for the purpose of this appraisal he had a heart attack and was unable’ to finish this inspection, overlooking completely his undisputed testimony that he had been familiar with these lands all his life. The opinion of the district judge, in discussing Mr. Ward’s failure to inspect the tracts in connection with this particular appraisal, mistakenly speaks of it as though he had at best only appraised two of the twelve tracts of land.” (Emphasis added.) Obviously Mr. Ward appraised all of them, but inspected only two of them in direct connection with this appraisal.