Sampson v. United States

529 F.2d 1299, 208 Ct. Cl. 656, 1976 U.S. Ct. Cl. LEXIS 138
CourtUnited States Court of Claims
DecidedJanuary 28, 1976
DocketNo. 379-68
StatusPublished
Cited by3 cases

This text of 529 F.2d 1299 (Sampson v. United States) is published on Counsel Stack Legal Research, covering United States Court of Claims primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Sampson v. United States, 529 F.2d 1299, 208 Ct. Cl. 656, 1976 U.S. Ct. Cl. LEXIS 138 (cc 1976).

Opinions

SkeltoN, Judge,

delivered the opinion of the court:

This case involves the claim of Walter J. Sampson, Bernard Greenbaum, Abner J. Mesirow, and Arthur A. Bogeaus, Co-partners, doing business under the name of Southeastern Industrial Development District (SID or plaintiff), as former owners of the Chimes Office Building in Syracuse, New York, to an award of $292,574.26 assessed against the United States, a former lessee of the building, as restoration damages upon the termination of the lease, as recommended by Trial Judge Spector and approved by an order of the court of June 28,1974, in 204 Ct. Cl. 920, from which no appeal was taken. The Equitable Life Assurance Society of the United States (Equitable) intervened in the suit before trial claiming that it is entitled to the award as mortgagee of the building in accordance with the terms of its mortgage and the assignment contained therein, so that the proceeds of the award can be applied on its unpaid mortgage indebtedness. SID moved to dismiss the intervention by Equitable. A decision on the motion was postponed until the merits had been decided, and we are now required to decide whether to allow the motion to dismiss Equitable’s intervention, and if denied, to decide who is entitled to the award. Both parties moved for summary judgment and oral argument was heard by a panel of the court, after which judgment was entered granting plaintiff’s motion for summary judgment, denying that of Equitable and dismissing Equitable’s petition in intervention. See 207 Ct. Cl. 17 (1975).

Following the above opinion, Equitable moved for a rehearing en banc which was granted, although SID opposed the motion. Additional briefs were filed and oral argument was heard by the en banc court. We reverse the decision of the panel and hold that Equitable is allowed to intervene and that 'as mortgagee and assignee it is entitled to the $292,574.26 award to be applied on its unpaid mortgage debt.

It appears that it will be necessary to again describe the basic facts upon which this controversy is based. The Chimes Building was built by the Hubb City Bealty Corporation in 1928 at a reported cost of $1,420,000. That corporation executed a bond in the sum of $1,200,000 and a mortgage on the property to Metropolitan Life Insurance Company, recorded [660]*660August 31,1929, in Liber 750 of Mortgages, page 641, County Clerk’s Office, Onondaga County, New York. Another bond in the sum of $600,000 and mortgage was given on the building by James E. and Blanche O. Hefferman to the Syracuse Trust Company on March 20, 1928, which was recorded the same day in Liber 725 of Mortgages, page 129 of said county. In due time, Equitable acquired these bonds and mortgages and combined and consolidated them with later mortgages, as will be described below.

On July 5, 1946, the Onondaga Holding Corporation acquired the Chimes Building subject to the above mortgages. On December 3, 1946, the United States leased the building from the corporation for $250,000 per year for five years with three five-year renewal options.

After leasing the building to the Government, the Onondaga Holding Corporation desired to consolidate the 1928 and 1929 mortgages, and such prior mortgages were combined and consolidated with the new mortgage, dated December 26, 1947. This consolidation was advantageous to Onondaga because the debts were consolidated into one debt and the dates and amounts of payments were made more flexible. This 1947 mortgage is recorded in Book 1310, page 663, of Mortgages, Onondaga County, New York. It is important, because for the first time an assignment of awards was made to Equitable. This assignment appears in Clause 20 as follows:

20. That any and all awards heretofore and hereafter made to the present and all subsequent owners of the mortgaged premises by any governmental or other lawful authorities for taking by eminent domain the whole or any part of said premises or any easement therein, including any awards for any changes of grade of streets, are hereby assigned to the holder of said mortgage who is hereby authorized to collect and receive the proceeds of any such awards from such authorities and to give proper receipts and acquittances therefor, and to apply the same toward the payment of the amount owing on account of said bond and mortgage, notwithstanding the fact that the amount owing thereon may not then be due and payable; and the said party of the second part convenants and agrees, upon request, to make, execute and deliver any and all assignments and other instruments sufficient for the purpose of assign[661]*661ing the aforesaid awards to the holder of said mortgage, free, clear and discharged of any and all encumbrances of any kind or nature whatsoever.

It will be noted that the assignment of awards in Clause 20 in this 1947 mortgage is limited to awards by the Government “for taking J>y eminent domain the whole or any fart of said 'premises * * [Emphasis supplied.] It is important to note that this limitation of awards to those for Government taking by eminent domain was omitted and does not appear in later (1954) moitgages executed by SID to Equitable, where the assignment covers all awards made by anyone. As will 'be shown below, neither the Government nor takings by eminent domain are even mentioned in the assignments in the 1954 mortgages executed by SID and upon which the parties base their claims in this case.

On February 29, 1952, over four years after Onondaga executed the 1947 mortgage to Equitable, SID acquired the Chimes Building for $3,000,000. At that time 'SID needed additional funds and to take care of this need it borrowed $284,625 from Equitable and in connection therewith executed a bond and mortgage dated April 1, 1954, recorded in Book 1642, page 221, of Mortgages, Onondaga County, New York. This mortgage contains an assignment of all awards made or to be made to the present and all subsequent owners of the ’building to Equitable as security for the payment of the bond. This assignment, as pointed out above, was a revision and a rewriting of what appeared in Clause 20 of the 1947 mortgage quoted above. The revised Clause 20 (although it is not so numbered in this 1954 mortgage) provides as follows:

Together also with any and all awards 'heretofore made and hereafter to be made to the present and all subsequent owners of said premises, including any award and awards for change of grade of any street ¡affecting said premises, which said award and awards are hereby assigned to the mortgagee, who is hereby authorized and empowered to collect and receive such award and awards and to give proper receipts and acquittances therefor, and to appy [sic] the same toward the payment of the amount owing on this mortgage, notwithstanding the fact that the amount owing on this mortgage may not then be due and payable; and the mortgagor for himself, [662]*662■bis heirs and all subsequent owners of said premises, hereby covenants and agrees with the mortgagee and the successors and 'assigns of the mortgagee, upon request by the holder of this mortgage to make, execute and deliver any and all assignments and other instruments sufficient for the purpose of ¡assigning said award and awards to the holder of this mortgage, free, clear and discharged of any encumbrances of any kind or nature whatsoever.

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Sampson v. United States
207 Ct. Cl. 17 (Court of Claims, 1975)

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Bluebook (online)
529 F.2d 1299, 208 Ct. Cl. 656, 1976 U.S. Ct. Cl. LEXIS 138, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sampson-v-united-states-cc-1976.