United State v. 180.37 Acres of Land, More or Less

254 F. Supp. 209, 1966 U.S. Dist. LEXIS 8192
CourtDistrict Court, W.D. Virginia
DecidedMay 23, 1966
DocketCiv. A. No. 64-C-58-R
StatusPublished
Cited by3 cases

This text of 254 F. Supp. 209 (United State v. 180.37 Acres of Land, More or Less) is published on Counsel Stack Legal Research, covering District Court, W.D. Virginia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United State v. 180.37 Acres of Land, More or Less, 254 F. Supp. 209, 1966 U.S. Dist. LEXIS 8192 (W.D. Va. 1966).

Opinion

DALTON, Chief Judge.

This is an action of a civil nature brought by the United States of America at the request of the Secretary of the Army for the taking of property under power of eminent domain in connection [210]*210with the construction, operation, and maintenance of the John W. Flannagan Dam and Reservoir, Pound River, Dickenson County, Virginia, and for the ascertainment and award of just compensation to the owners and parties in interest. Although in this proceeding, several tracts and rights of different parties are involved, this opinion will deal only with the interest of the Atomic Fuel Company, Incorporated (hereinafter referred to as “Atomic”) in three tracts, designated as 111-1, 111-2, and 111 E-4.

The owner of the mineral rights in the tracts here involved is the Steinman Development Company (hereinafter referred to as “Steinman”), a New Jersey corporation. By an indenture entered into on January 1, 1957 between Steinman and the Pound River Coal Company, Incorporated (hereinafter referred to as “Pound River”), the former purported to lease for- a period of five years (beginning December 31, 1956), “for coal mining purposes only”, 581 acres of land, a portion of which comprises the tracts in question here. The “lessee” was to have a right of renewal provided, among other things, that it constructed a plant capable of producing 300 tons of coal per day during the period of the original lease. Such a plant was never constructed, but it appears that Steinman nevertheless continued to “lease” the land to Pound River after the expiration date of the original agreement. By an instrument dated December 9, 1963, Pound River assigned the “lease” between it and Stein-man to Atomic, and it is through this assignment that Atomic claims its right to compensation by reason of the government condemnation.

The tracts which the government took lie along the left ascending side of Cane Branch and along the edge of the 581 acre “leasehold,” and comprise 17.26 acres of the total 581 acres in which Atomic claims an interest.

The complaint in this case was filed on June 4, 1964, together with a declaration of taking and a judgment on declaration of taking vesting title to the estate defined therein in and to the properties described therein in the United States- of America on June 4, 1964. The record shows that until sometime prior to this date Cane Branch was to be used as a “spillway” in connection with the operation of the Flannagan Dam. Flowage easements only were first obtained and the channel was straightened, widened, and leveled off to accommodate the overflow waters from the dam. Due to some change in the projected function and use of the dam it was determined sometime prior to June 4, 1964 that certain changes should be made, including the placing of a gate structure in the Cane Branch valley. This necessitated the present taking.

Tract 111-1 is taken in fee, and consists of 38.14 acres, some five acres of which are included in Atomic’s 581 acre grant. The taking of tracts 111-2 and 111 E-4 in effect gives the government the fee for a period of two years only, after which it will merely retain a flow-age easement. It is further provided that the type and location of any structures now existing or to be erected on the land must be approved by the District Engineer, U.S. Army Engineer District Huntington, or his duly authorized representative.

Federal Rule 71A(h) provides that in condemnation proceedings the court may, in its discretion, appoint a commission of three persons to determine the issue of compensation to be awarded. The commission shall have the powers of a master provided in subdivision (c) of Rule 53. Rule 53(e) (2) provides that the findings of fact by the master shall be accepted unless clearly erroneous, and Rule 71A applies this standard to the findings of the commission.

This cause was referred to three commissioners for findings as to the relative interests of the parties involved and the just compensation to be afforded each of them. By a report dated January 8,1966, the commissioners granted Atomic only the nominal consideration of one dollar for whatever interest it possessed in [211]*211tracts 111-1, 111-2 and 111 E-4. For the reasons which follow, the court will affirm the findings of the commission.

It is a mandate of the Fifth Amendment to the Constitution of the United States that “private property [shall not] be taken for public use, without just compensation.” However, before any consideration of compensation can be embarked upon, it must first be determined whether Atomic has an interest in the condemned land which the Fifth Amendment protects. It does not seem to be disputed by any of the parties here that to entitle a person having a right of occupancy of real estate to recover compensation when the land is taken, he must have an actual estate or interest in the soil. A mere contractual relation not creating such an interest is insufficient. See 2 Nichols, Eminent Domain § 5.23(7) (3rd ed. 1963).

The first line of inquiry with respect to Atomic’s interest in the land in question concerns the nature of the instrument which was assigned to it by Pound River, as it is elementary that the fact that it was called a “lease” by the parties does not necessarily make it so. It is not how or what someone may characterize an instrument that determines its classification; it is the tenor, contents and substance which is the test of what the document is in law. It was the duty of the commissioners to ascertain the actual relationship which existed between Steinman and Pound River, and they came to the conclusion that the indenture of January 1, 1957 granted a mere license rather than a leasehold estate (in the report the instrument was sometimes referred to as “the lease,” presumably for identification purposes). In reaching this decision, the commissioners did a thorough and competent job on a complex problem which required much thought and research, and this court agrees fully with their conclusion.

A lease of the tracts in question would have created an actual estate in the lessee, and in eminent domain proceedings the lessee would be entitled to compensation for the taking of his interest. 2 Nichols, Eminent Domain § 5.23(1) (3d ed. 1963). However, “ [a] mining license is an incorporeal right to take ore or minerals from the land of another — a mere privilege existing contemporaneously with a like right in the grantor. It carries with it no estate or possessory interest in the land. It is only when the right to mine the minerals is not exclusive that it may be classed as an easement in the nature of a license. The licensee acquires no right to the mineral until he separates it from the freehold.” 36 Am. Jur. Mines & Minerals § 63 (1941). Bostic v. Bostic, 199 Va. 348, 99 S.E.2d 591, 66 A.L.R.2d 971 (1957). See also: Annot., 66 A.L.R.2d 978 (1959); 36 Am. Jur. Mines & Minerals § 40 (1941). Since a license is generally revocable at will, the owner of such a privilege has no remedy for an invasion of hi's rights. It follows from this that a license as such is generally not considered compensable in eminent domain proceedings. “It has been rationalized that since the sale of the dominant estate destroys the license, the license is equally destroyed upon the vesting of title in the condemnor.” 2 Nichols, Eminent Domain § 5.751 (3d ed. 1963).

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254 F. Supp. 209, 1966 U.S. Dist. LEXIS 8192, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-state-v-18037-acres-of-land-more-or-less-vawd-1966.