National Railroad Passenger Corp. v. Catalina Enterprises, Inc. Pension Trust , 147 F. App'x 378 ( 2005 )

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 04-1480
NATIONAL RAILROAD PASSENGER CORPORATION, a/k/a
Amtrak,
Plaintiff - Appellee,
versus
CATALINA ENTERPRISES, INCORPORATED PENSION
TRUST,
Defendant - Appellant,
and
1.578 ACRES MORE OR LESS OF LAND, located at
6301 Quad Avenue in Baltimore City, Maryland;
STERN FAMILY INVESTMENTS, LLLP; G. REX
SIZEMORE; CATALINA ENTERPRISES, INCORPORATED;
UNKNOWN OTHERS; NANCY C. ROBERTSON; GENERAL
VECTOR CORPORATION; BANK OF AMERICA, as
successor in interest to Maryland National
Bank; EDWARD J. MAKOWSKI, JR.; BALTIMORE CITY,
State of Maryland,
Defendants,
versus
DAVID P. STERN, Trustee; WHITING-TURNER
CONTRACTING COMPANY; KYRIAKOS P. MARUDAS;
RONALD U. SHAW; BANK OF AMERICA; EDWARD J.
MAKOWSKI,
Parties in Interest.
Appeal from the United States District Court for the District of
Maryland, at Baltimore. Paul W. Grimm, Magistrate Judge. (CA-00-
3569-PWG)
Argued: November 30, 2004 Decided: September 30, 2005
Before WIDENER, MICHAEL, and MOTZ, Circuit Judges.
Affirmed by unpublished per curiam opinion. Judge Widener wrote a
dissenting opinion.
ARGUED: Douglas Richard Taylor, Rockville, Maryland, for Appellant.
Natalie Paige Drinkard, HODES, ULMAN, PESSIN & KATZ, P.A., Towson,
Maryland, for Appellee. ON BRIEF: Patricia McHugh Lambert, HODES,
ULMAN, PESSIN & KATZ, P.A., Towson, Maryland, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).
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PER CURIAM:
I.
This is an eminent domain case between plaintiff National
Railroad Passenger Corporation (Amtrak) and defendant Catalina
Enterprises (Catalina). This case began on December 5, 2000 when
Amtrak, using the power of condemnation conferred on it by Congress
under 49 U.S.C. § 24311, filed its complaint in condemnation, and
for possession of, certain lands in the district of Maryland. The
property at issue is approximately 1.578 acres of land which is
improved by a warehouse of approximately 32,396 square feet.
Approximately 16,800 square feet of the warehouse had been damaged
by a fire in 1992 and had not been repaired or reconstructed at the
time of the taking. The parties consented to a magistrate judge’s
jurisdiction and the case was assigned to a magistrate judge. The
defendant requested that the question of just compensation be
submitted to a jury, which was denied on March 21, 2001. The case
was then assigned to a land commission, consisting of three retired
state judges, which held a five-day hearing in the matter, and
determined that the compensation for the property was $305,242.
The district court conducted a hearing on defendant’s objections
and opposition to the land commissioners’ report on February 2,
2004, in which it applied a de novo standard of review. The
district court overruled the objections to the land commissioners’
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report and adopted its findings of fact and conclusions of law.
The report of the land commissioners was filed on March 11, 2004.
Judgment was then entered on March 12, 2004. Defendant appeals the
orders of the district court, which it asserts prevented it from
having a fair trial.
Catalina first asserts that the district court’s March 12,
2002 order wrongfully precluded it from sufficiently completing
discovery on the issue of the cost of repairing the warehouse, that
the court’s February 4, 2003 order failed to provide an adequate
opportunity to complete discovery on that issue, and that the
district court abused its discretion in not granting an extension
to file an expert’s report, due to a blizzard. Defendant also
challenges the district court’s denial of its request for a jury
trial. Defendant also argues that the district court erred both
in denying its motion in limine regarding plaintiff’s hybrid
witness and in concluding that the estimate to repair the property
from an earlier lawsuit had been adopted by Catalina’s witness.
Catalina lastly asserts that the district court erred in
determining that just compensation for the property was $305,242.
For the reasons stated below, we affirm the judgment of the trial
court.
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II.
Catalina contends that the trial court erred in denying its
request for a jury trial in this case. The denial of Catalina’s
request for a trial by jury in this case is governed by the abuse
of discretion standard. United States v. Keller, 142 F.3d 718 (4th
Cir. 1998). There is no Constitutional right to a jury trial in
eminent domain proceedings. United States v. Reynolds, 397 U.S.
14, 18 (1970) (citing Bauman v. Ross, 167 U.S. 548, 593 (1897)).
Federal Rule of Civil Procedure 71A(h) explicitly gives the
district court discretion in determining whether or not to grant a
jury trial, specifically stating:
[A]ny party may have a trial by jury of the issue of just
compensation by filing a demand therefor within the time
allowed for answer or within such further time as the
court may fix, unless the court in its discretion orders
that, because of the character, location, or quantity of
the property to be condemned, or for other reasons in the
interests of justice, the issue of compensation shall be
determined by a commission of three persons appointed by
it . . . .
Fed. R. Civ. P. 71A(h). This rule “gives the trial court
discretion to eliminate a jury entirely.” United States v.
Reynolds, 397 U.S. 14, 20 (1970); Accord Keller, 142 F.3d at 721.
In this case, the district court exercised its discretion and
determined that the issue of just compensation should be determined
before the land commissioners. The district court identified
reasons for this determination as the existence of a standing land
commission for the district; the peculiar nature of land
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condemnation cases involving commercial property; and the judicial
and real estate experience of the land commissioners. In our
opinion, this decision was a permissible exercise of the district
court’s discretion under Rule 71A(h). There is nothing in the
reasons given by the district court to support Catalina’s claim
that the denial of a trial by jury was an abuse of discretion. On
appeal, Catalina takes the position that Amtrak was allowed to
change its position as to a jury trial on account of a change in
Fed. R. Civ. P. 53 and infers that this required the granting of
its motion for trial by jury. Any such action which has been so
taken by Amtrak, the court does not consider to be a sufficient
reason to support a holding of an abuse of discretion in the
district court’s denial of Catalina’s motion.
The denial of trial by jury is affirmed.
III.
Catalina also contends that the district court erred by
preventing it from adequately completing discovery and presenting
evidence on the issue of the cost of repairing the warehouse.
Catalina takes issue with two orders of the district court to
support this argument. As Catalina concedes, Brief of Appellant at
16, we review the challenged orders for abuse of discretion.
The complaint in this case was filed on December 5, 2000;
discovery was contentious. In an effort to resolve one discovery
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dispute, on October 25, 2001, the district court issued an order
requiring Catalina to submit the report of its appraisal expert,
Richard H. Nichols, within ninety days. J.A. 137. On January 16,
2002, Catalina moved that it be allowed an additional thirty days
to submit Mr. Nichols’ report because that report assertedly relied
on another expert’s opinion as to the cost of repair and
reconstruction and the other expert had unexpectedly died on
January 8. J.A. 202-203. On January 22, 2002, the district court
held a conference to resolve this and other discovery matters.
J.A. 207-242. The court granted the thirty days extension. J.A.
224, 243.
On February 11, 2002, Catalina submitted Mr. Nichols’ report
but moved for an extension of time until March 30, 2002 to submit
the report of its additional experts (now six of them) on repair
and reconstruction. J.A. 249-52. On March 12, 2002, the district
court denied that motion reasoning that the issue of repair and
reconstruction costs was of “slight, if any relevance,” not
warranting the considerable expense entailed in the creation of
“six expert reports and perhaps an equal number of rebuttal
experts.” J.A. 278. This March 12, 2002 order is the first order
Catalina challenges.
Even assuming the district court abused its discretion in
issuing this order, that abuse was cured when the court later
modified its order to permit Catalina the opportunity to designate
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a repair and reconstruction expert. Seven months after the
issuance of the March 12, 2002 order, on October 31, 2002, Catalina
moved for modification of the March 12 order to permit it
additional time to submit the reports of its repair experts. J.A.
497-504. On February 4, 2003, the district court held a hearing on
the matter, in which Catalina clarified that even though the fire-
damaged building had been torn down in the preceding seven months,
it would like to “have a witness, a cost estimator or contractor be
able to express an opinion regarding the cost of repair.” J.A.
613. Given expert testimony that repair and reconstruction,
although an “unusual” element in determining valuation, was not
“unheard of,” J.A. 597, the court modified its March 12, 2002
order. It permitted Catalina thirty days to disclose a
“contractor, or a cost estimator” and submit that expert’s report
on repair costs. J.A. 617.
In doing so, the court warned Catalina:
. . . the pace has not been exemplary. I will be candid,
there have been times when I have been tempted to reach
the conclusion that [Catalina] has not been acting with
the degree of concern to get this thing resolved that I
thought was appropriate. . . . I will make it crystal
clear that these deadlines will not be modified, they
will be met or they are gone.
J.A. 616-617 (emphasis added). On February 5, 2003, the court
issued a written order confirming this oral order; the written
order provided inter alia that Catalina had 30 days -- until March
6, 2003 -- to designate “a general contractor or a cost estimator”
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on the issue of repair costs and to submit his report. The court
reiterated that the order would “not be changed absent
extraordinary circumstances.” J.A. 631-632 (emphasis added).
Nevertheless, on February 28, 2003 Catalina again moved for an
extension of time. Catalina stated that after ten days it had
located a repair expert, D. Neil Sinclair, but could not submit his
report because a February snowstorm had prevented Mr. Sinclair from
visiting the site and so preparing his report. J.A. 633-34.
Amtrak objected to the motion on numerous grounds, noting inter
alia that the snowstorm did not prevent Catalina from fulfilling
its other discovery obligations under the rules; yet Catalina had
failed to notify Amtrak of Mr. Sinclair’s qualifications, rate of
compensation, list of publications, or list of cases in which he
had testified -- all of which are required by Fed. R. Civ. P. 26 --
and had failed to contact counsel for Amtrak to make arrangements
to visit the site or discuss the issue, as required by the Local
Rules. J.A. 653E-M.
On April 7, 2003, the district court denied Catalina’s motion
for extension J.A. 690 -- this is the second order that Catalina
challenges on appeal. The court assumed, without deciding, as
Catalina proffered, that the excuses offered for the delay “are not
because of Pension Trust” but decided that they did not warrant a
modification of the deadline. The district court acted pursuant to
Rule 37(c) and found that Catalina had not demonstrated
9
“substantial justification” for its failure to meet the deadlines
imposed by the court in its order of February 4, 2003. It found,
further, that Amtrak would be prejudiced by granting additional
time.
Rule 37(c)(1) expressly provides a district court with
discretion to penalize a party who fails -- “without substantial
justification” -- to comply with procedural rules and court orders.
No finding of fault or “bad faith” is required prior to imposition
of these sanctions. We are of the opinion the findings of the
district court are essentially factual and are not clearly
erroneous. Its decision to preclude the admission of the testimony
of the expert as to the cost of repairs was not an abuse of
discretion and is affirmed. See Mut. Fed. Sav. & Loan v. Richards
& Assocs., 852 F.2d 88 (4th Cir. 1989); cf. Rabb v. Amatex Corp.,
757 F.2d 996 (4th Cir. 1985).
IV.
There was no reversible error in admitting the testimony of
James Jost offered by Amtrak as an hybrid witness - part expert,
part fact. There was also no reversible error admitting an
estimate of repair damage prepared by Catalina’s insurance company
and used in an earlier law suit.
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V.
Catalina’s final contention is that the district court erred
in determining that it had failed to prove by a preponderance of
the evidence that the resulting value from the repairs justified
the necessary expenditures, and therefore determining that just
compensation was $305,242. To support this Catalina points to the
fact that the land commissioners failed to discuss and consider the
testimony of Mr. Nichols that it was economically feasible to
repair the warehouse and any seller of the property would do so
before selling. However, the district court rejected Mr. Nichols’
repair cost opinions as not being persuasive.
Notably, the method each side depended on to ascertain value
was the same and based largely on rental value of the premises.
Amtrak’s evidence of rental value was $20.00. Catalina’s was
$22.50. The finding of the land commissioners of $22 was not
clearly erroneous, and we affirm.
The judgment of the district court is accordingly
AFFIRMED.
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WIDENER, Circuit Judge, dissenting:
I respectfully dissent. While the reasons given by the
majority usually justify an affirmance, in this case I think that
a new trial is required for the reasons which follow.
I.
There can be no doubt that the excluded evidence is the key to
this case. Indeed, the district court commented that the “only
real differences, and everybody agrees, is whether or not the
repairs were feasible to the fire damaged property.” The Land
Commissioners noted this issue’s importance as well. The Land
Commissioners’ report also expressly relied on Catalina’s failure
to submit reconstruction expert testimony in recommending an award
in Amtrak’s favor.
Nevertheless, Catalina failed to introduce any competent
evidence on which evidence of repair costs could be made.
They failed to provide expert opinion that any steel or
masonry could be used or, if some could be used, exactly
how much and at what cost.
J.A. 1771.
The reason that the evidence was so crucial is simple: the
area to be restored, the cost of which was disputed, constituted
about one-half of the total square footage of the property. As the
Land Commissioners observed, the parties’ determinations of value
per square foot were almost identical: $20 by Amtrak, and $22.50
by Catalina. Thus, the condemnation award would effectively have
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doubled had Catalina’s reconstruction-cost evidence been considered
and credited. On the other hand, exclusion possibly halved the
award.
II.
The district court erred by excluding evidence that should
have been provisionally admitted, making it impossible for this
court to assess whether the exclusion was harmless.
A.
In this non-jury setting, the district court should have
admitted relevant evidence of repair costs and disregarded any
evidence that it found inadmissible or unpersuasive when rendering
its decision.
In Multi-Medical Convalescent & Nursing Center of Towson v.
N.L.R.B., 550 F.2d 974 (4th Cir. 1977), we expressed grave concern
about an administrative law judge’s “curtail[ing] development of
potentially relevant lines of inquiry.” Id. at 976. We
recommended liberalized admission in non-jury trials:
Professor Wright tells us that “the attitude now
governing has been strongly stated by Judge Sanborn: ‘In
the trial of a nonjury case, it is virtually impossible
for a trial judge to commit reversible error by receiving
incompetent evidence, whether objected to or not’.” The
appellate courts have taken a similarly critical view of
exclusionary rulings by administrative agencies. Thus,
we strongly advise administrative law judges: if in
doubt, let it in.
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Id. at 978 (citations omitted).
This principle extends to all sorts of non-jury trials. See
Eagle-Picher Indus., Inc. v. Liberty Mut. Ins. Co., 682 F.2d 12, 18
(1st Cir. 1982) (“a district court, sitting without a jury, might
be well advised to admit provisionally all extrinsic evidence of
the parties’ intent, unless it is clearly inadmissible, privileged,
or too time consuming, in order to guard against reversal”)
(emphasis added); Gulf States Utils. Co. v. Ecodyne Corp., 635 F.2d
517, 519 (5th Cir. 1981) (calling exclusion of “prejudicial”
evidence in a bench trial a “useless procedure”). We expressly
adopted Gulf States in Schultz v. Butcher, 24 F.3d 626 (4th Cir.
1994), finding that the district court’s error in excluding
evidence was not harmless because “a party was prevented from fully
developing evidence relevant to a material issue.” Id. at 632
The broader admissibility of evidence in bench trials is
premised on the helpfulness of the practice in appellate review.
Indeed, McCormick recommends that courts “provisionally admit all
arguably admissible evidence, even if objected to[,] with the
announcement that all admissibility questions are reserved until
all the evidence is in”; the treatise explains that this “helps
ensure that appellate courts have in the record the evidence that
was rejected as well as that which was received.” McCormick on
Evidence § 60 (4th ed. 1992) (footnote omitted).
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Given the Land Commissioners’ reliance on the absence of
reconstruction-cost testimony in support of Catalina, I believe
that these principles apply to this case, where the excluded
evidence spoke to not just a material issue, but the material
issue. Cf. Schultz, 24 F.3d at 632. The district court should
have admitted the evidence into the record and later decided the
questions of admissibility and weight to be given the evidence.
B.
The report in question with respect to an estimate of repair
costs was due on March 6, 2003, 30 days from the date of the
February 4, 2003 hearing. It was offered for filing late, a reason
given by Catalina being that Baltimore, in that period, had a snow
storm, which turned out to be a blizzard, which was all or part of
the reason offered for the delay. While the district court
rejected the reasons given by Catalina for the late offering of the
repair estimate, it stated in two places that it did not rely on
those reasons for its decision not to admit the testimony of the
expert who had been employed by Catalina. It stated, on April 7,
2003, “Even assuming without deciding, as Catalina proffers, that
the excuses offered for the delay are not because of Pension Trust,
such excuses do not warrant a modification of the deadline.” J.A.
691. And, in deciding Catalina’s objections to the Land
Commissioners’ finding, the district court stated:
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Now, because the Defendants in this case failed to comply
with that order, the sanctions appropriate were under
Rule 37 of the Federal Rules of Civil Procedure. They
were sanctioned for failing to obey a court order
They were not sanctioned under Rule 37 for failing to
make Rule 26(A)(2)(b) disclosures, which has a different
standard and is a more stringent standard.
J.A. 1928. Thus, the key evidence was held to be inadmissible and
kept from the Land Commissioners because of the violation of a
court order.
It is true the district court decided that Amtrak had been
prejudiced by such failure, but it did not state how Amtrak was
prejudiced. In particular, so far as this record shows, there was
no delay on account of such failure, the letters from the expert
with respect to the delay being dated February 27 and March 14,
2003. So far as we are advised, the case, at the time of the
district court’s order of April 7, 2003, had not been set for
trial, and the trial of the case before the Land Commissioners was
some five months later, in September, 2003. So whatever prejudice
Amtrak may have suffered, it was not in a delay of the trial. In
any event, any prejudice to Amtrak on that account, other than
allowing Catalina to reach the merits of the controversy, could
only have been in annoyance and additional expenses, if any. As we
have mentioned before, Amtrak was in possession of the property and
had been using the same for more than a year, so there was no
denial of use.
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Accordingly, I would vacate the judgment of the district court
and grant a new trial.
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