United States v. 50 Acres of Land, Etc., the City of Duncanville

706 F.2d 1356, 1983 U.S. App. LEXIS 26802
CourtCourt of Appeals for the Fifth Circuit
DecidedJune 13, 1983
Docket81-1615
StatusPublished
Cited by8 cases

This text of 706 F.2d 1356 (United States v. 50 Acres of Land, Etc., the City of Duncanville) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United States v. 50 Acres of Land, Etc., the City of Duncanville, 706 F.2d 1356, 1983 U.S. App. LEXIS 26802 (5th Cir. 1983).

Opinion

JOHN R. BROWN, Circuit Judge:

Today we find ourselves lodged among melon rinds, coffee grounds, countless tin cans and sundry other unlikely neighbors amidst the City of Duncanville sanitary landfill. In this ignoble setting, we examine one of our most treasured constitutional principles — the Fifth Amendment’s precept that private property shall not be taken for public purposes without just compensation. We consider the question of what constitutes the 1 payment of “just compensation” to a public condemnee who has a duty to replace a condemned public facility. Appellee, the United States, contends that Duncanville is entitled only to the fair market value of its old landfill, which was condemned by the government. Duncanville argues that just compensation is the cost of a substitute landfill. We agree with Duncanville and conclude that under the Fifth Amendment a public condemnee which has a legal or factual duty to replace a condemned facility is entitled to the reasonable cost of a functionally equivalent substitute facility. We conclude also that the trial court’s instruction concerning the substitute facilities standard was inadequate to enable the jury to make an intelli-. gent determination of that cost. Accordingly, we remand for a new trial.

*1358 Indeed, this case is redolent with Fifth Amendment issues, as Duncanville objects also to the trial court’s award of 6% interest under the Declaration of Taking Act, 40 U.S.C. § 258a. This Court has very recently held that the 6% rate is a floor, not a ceiling, on allowable rates of interest in this situation, and that the refusal to allow a higher rate of interest may be a denial of just compensation under the Fifth Amendment. U.S. v. 329.73 Acres of Land, Situated in Grenada and Yalobusha Counties, State of Mississippi, (5th Cir.1983) (en banc) 704 F.2d 800. As we remand for a new trial on the issue of the reasonable cost of a substitute facility, we also remand to the district court the question of a proper rate of interest.

Duncanville is a small home rule city of approximately 28,000 people located in the southwest portion of Dallas County, Texas. It operated a sanitary landfill on a tract of approximately 50 acres southwest of the city, along Ballwag Road in Dallas County, near the Tarrant County line. The United States condemned this tract (the Ballwag site) pursuant to the construction of Lake-view Lake, a redundantly named U.S. Army Corps of Engineers flood control project. 1 In accordance with the provisions of the Declaration of Taking Act, the government deposited its estimated value of the condemned property, $199,950.00, into the registry of the Court. 2

For approximately two years after the taking of the Ballwag site, Duncanville trucked its daily garbage to a landfill near Ferris, Texas, some 22 miles to the southeast. It then acquired a new site of its own in northwest Ellis County (the Ellis County site), approximately the same driving time from Duncanville as the Ballwag site. This site consists of approximately 113.7 acres. Duncanville has been using the Ellis County site since January 1, 1981.

Duncanville demanded a jury trial on the issue of compensation, contending that the amount offered by the government was inadequate because Duncanville was entitled to' the reasonable cost of substitute facilities, rather than merely the fair market value of the condemned property. Duncan-ville asked for the cost of the Ellis County land, the costs of permitting and preparation, and the costs of the interim use of the Ferris landfill.

After the presentation of evidence and arguments, the trial judge submitted two special interrogatories to the jury. Special question number one required a finding as to the fair market value of the 50-acre Ballwag site, which the jury fixed at $225,-000. Special question number two required a finding as to the cost of supplying a functionally equivalent substitute landfill site, which the jury fixed at $723,654.01. The district court then concluded that as a matter of law the market value of the Ballwag site was the proper measure of compensation and entered judgment for $225,000.00. He set interest on the unpaid balance of $25,050.00 at 6%. 3 Duncanville appeals.

The Fifth Amendment to the U.S. Consti- . tution provides,

[N]or shall private property be taken for public use, without just compensation.

The issue here is what measure of compensation is “just” when a public entity is obligated to replace its condemned public facility.

In United States v. 564.54 Acres of Land, More or Less, Situated in Monroe and Pike Counties, Pennsylvania, (Lutheran Synod), 441 U.S. 506, 99 S.Ct. 1854, 60 L.Ed.2d 435 (1979), the Supreme Court declined to discuss the precise question presented here. The Court ruled that the payment of fair market value is sufficient compensation to *1359 a private non-profit organization whose property is operated for a public purpose.

In Lutheran Synod, the Court acknowledged that generally an award of fair market value strikes “a fair ‘balance between the public’s need and the claimant’s loss’ upon condemnation of property for a public purpose.” 441 U.S. at 512, 99 S.Ct. at 1857, 60 L.Ed.2d at 441, quoting United States v. Toronto, Hamilton & Buffalo Nav. Co., 338 U.S. 396, 402, 70 S.Ct. 217, 221, 94 L.Ed. 195 (1949). Nevertheless, the Court recognized and reaffirmed that fair market value is not and cannot be the single, inflexible measure of just compensation.

“[W]hen market value has been too difficult to find, or when its application would result in manifest injustice to owner or public, courts have fashioned and applied other standards.... Whatever the circumstances under which such constitutional questions arise, the dominant consideration always remains the same: What compensation is ‘just’ both to an owner whose property is taken and to the public that must pay the bill?”

441 U.S. at 512, 99 S.Ct. at 1857, 60 L.Ed.2d at 442, quoting United States v. Commodities Trading Corp., 339 U.S. 121, 123, 70 S.Ct. 547, 549, 94 L.Ed. 707 (1950). See also United States v. 320.0 Acres of Land, More or Less, in the County of Monroe, State of Florida, 605 F.2d 762, 780-81 (5th Cir.1979).

The substitute facilities doctrine arose from that realization that “just compensation” and “fair market value” are not always synonymous.

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