United States v. 8286 Sq. Ft. of Space in Paca-Pratt Bldg.

61 F. Supp. 737, 1945 U.S. Dist. LEXIS 2050
CourtDistrict Court, D. Maryland
DecidedJuly 25, 1945
DocketCiv. 2260
StatusPublished
Cited by16 cases

This text of 61 F. Supp. 737 (United States v. 8286 Sq. Ft. of Space in Paca-Pratt Bldg.) is published on Counsel Stack Legal Research, covering District Court, D. Maryland primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United States v. 8286 Sq. Ft. of Space in Paca-Pratt Bldg., 61 F. Supp. 737, 1945 U.S. Dist. LEXIS 2050 (D. Md. 1945).

Opinion

CHESNUT, District Judge.

In this federal condemnation case the .government had taken under the Second War Powers Act of 1942, 50 U.S.C.A. Appendix § 631 et seq., and on June 17, 1944 occupied, 8286 square feet of space on the 8th floor of the Paca-Pratt Building *738 (heretofore known as ■ the Sonneborn Building) in the City of Baltimore, for office use by the Baltimore Cargo Port of Embarkation. The term for which the space was originally taken was for a term of years ending June 30, 1945, which, however, by notice duly given and filed in this proceeding with deposit of agreed upon rental, has now been extended until June 30, 1946. At the time the government took possession of the office space it was under lease from the owner, The Paca-Pratt Realty Corporation, to Lee Cohen and Harry Gray, co-partners trading as Hy Grade Fur Company, by a written lease dated April 30, 1943 for one year commencing on the 1st day of May 1943, and ending on the 30th day of April 1944, “or until the stipulated term shall as hereinafter provided sooner cease or be terminated or be renewed or continued, at the annual rental of $3237.60”. The lease provided that in the absence of sixty days written notice prior to expiration, it should be renewed for the further term of a year upon the same conditions as to rental and otherwise. Under date of February 29, 1944 the landlord undertook to give the sixty day notice of termination to the tenant but the letter mailed at the office of the landlord in New York City was not received by the tenant until several days later, and therefore was not a timely notice for termination; in consequence of which the lease was automatically renewed to terminate April 30, 1945.

On July 12, 1944 the former tenants ot the space, the Hy Grade Fur Company, filed a claim, and an amendment thereto on June 19, 1945, for just compensation. The United States has filed a motion to strike the claim on the ground that the tenant is not entitled to any compensation for the taking in the circumstances of the case. At the trial of this issue the parties waived a jury and the case was heard upon the evidence submitted. The pertinent and controlling facts found from the evidence can be briefly stated.

The Sonneborn (now Paca-Pratt) Building is situated in the business district of Baltimore City. It was originally occupied and used for the manufacture of clothing, but more recently, after a change of ownership, it has been rented to various tenants for manufacturing and other purposes.

The Hy Grade Fur Company, now a partnership, successor to a corporation of the same name, had been a tenant of the condemned office space for about fifteen years under successive leases.' It used the premises for the manufacture of comparatively inexpensive fur coats. It had equipped the space with machinery and other trade tools and fixtures appropriate for the business. By reason of the government’s taking possession it was obliged to remove its fixtures on very short notice, and to temporarily relocate for a few months in another building nearby, and then to again remove to another more permanent location. It has filed an itemized claim for expenses of removal of its fixtures to these new locations and the cost of adapting machinery to the new location, and similar expenses in the amount of $4459.88, with a separate and additional claim in the amount of $4500 for damages based on interference with and diminution of business by reason of the necessary relocations. It has offered evidence tending to support most of the items of its claim. It is, however, not necessary to determine the exact amount of damages sustained. Under no aspect of the case could the claim for damages to the business be allowed. A number’ of separate items for moving expenses and kindred items would also have to be disallowed even if the claimants were entitled to some recovery; but the testimony is convincing that the claimants undoubtedly sustained substantial actual consequential damages in the amount of several thousand dollars due to expenses of moving and readaptation of machinery necessitated by change in location and inaccessibility of the kind of electric power current previously used in the Paca-Pratt Building.

The lease was on a long printed form, the 14th Article of which reads as follows: “Fourteenth: It is mutually convenanted and agreed that if the whole or any part of the premises shall be required, taken or condemned by any competent authority for any public or quasi-public use or purpose, then in any such event this lease and the term and any renewal and all rights and liabilities of the parties, each to the other, thereafter accruing, shall cease and expire and become null and void from and after the date when such possession shall be required or title be vested, without apportionment to Tenant of the award or other compensation, if any, by reason of such requisition, taking or condemnation; but nothing herein contained shall deprive Tenant of the right, if any, to receive from *739 the requisitioning or condemning authority award for compensation or loss of or damage to any of Tenant’s tangible property or business, provided the same is not in diminution of the award or compensation payable to Landlord; and Tenant shall make payment of all rent and other charges accrued and pro-rated to the date of such requisition, taking or condemnation.”

The basic rental rate for space in the Paca-Pratt Building has been 40 cents per square foot. An agreement has been made between the government and the building owner that the rental to be paid by the government during its temporary occupation of the space condemned, shall be at the rate of 50 cents per square foot per year, but with reduction to 45 cents per square foot to July 1, 1948, if the government occupies the property that long, in consequence of certain improvements to an elevator made at government expense. The rental paid by the claimants was at the rate of about 40 cents per square foot. It is contended by the government that the increased rental agreed to be paid by it is in consideration for additional services to be performed by the landlord particularly in that the office space will be occupied by many more employes than those heretofore serving the claimants. This reason for the increased rental is disputed by the claimants as a matter of fact. It is unnecessary to decide the point in this case.

My conclusion is that the claimants are not entitled to recover, principally by reason of the fourteenth article of the lease quoted above.

Opinion

Counsel for the claimants relies on the recently decided case of United States v. General Motors Corporation, 323 U.S. 373, 65 S.Ct. 357, 361. This now well known federal condemnation case dealt with the admissibility of evidence for the determination of just compensation in “an extraordinary and unusual” situation. The particular case involved a taking by the government for temporary occupancy of a warehouse, then under a long term lease to the tenants who were claimants in the case. The court was dealing with a situation in which presumably the government’s occupation would be much less in duration than that of the tenant’s lease, and after the termination of the government occupation the tenants would resume occupancy. The tenants had equipped the building with costly trade fixtures which it was necessary to remove and store during the temporary occupation.

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Bluebook (online)
61 F. Supp. 737, 1945 U.S. Dist. LEXIS 2050, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-v-8286-sq-ft-of-space-in-paca-pratt-bldg-mdd-1945.