People Ex Rel. Deparment of Public Works v. Superior Court , 68 Cal. 2d 206 ( 1968 )

TRAYNOR, C. J.

The Department of Public Works seeks to compel the trial court to proceed with the condemnation of three instead of two parcels of real property owned by the real parties in interest, Roy and Thelma Rodoni.

The department built a freeway across a farm owned by the Rodonis. The farm consists of a southern rectangular parcel and a northern triangular parcel. The northeast corner of the former touches the southwest corner of the latter. The free-' way crosses the adjoining corners, taking a tip of each, which total .65 acres. As a result, the northern parcel of approximately 54 acres is landlocked.

In addition to the .65 acres the freeway occupies, the department seeks to condemn the remaining landlocked 54 acres pursuant to Streets and Highways Code section 104.1.¹ Its purpose is to protect the fisc by eliminating the risk that excessive severance damages to the landlocked parcel might be awarded for the taking of the corner that provided access to it. The department points out that if it is allowed to condemn the entire parcel the Rodonis will receive full value for their property, the risk of excessive severance damages will be eliminated, and ultimately it will be able to reduce the cost of the freeway by selling the part of the parcel not needed for freeway purposes.

The Rodonis challenge the excess condemnation on the ground that taking property for such a purely economic purpose violates article I, section 14 of the California Constitution* ² because such taking is not for a “public use.” They contend that excess condemnation must be limited to parcels that may properly be deemed remnants with respect to which the public interest in avoiding fragmented ownership comes into play. In their view, 54 acres, even if landlocked and of little value, cannot be deemed a remnant of .65 acres. They insist that the state pay severance damages for the landlocked parcel and allow them to retain it, even though severance damages may be equal to its full original market value. They also assert that the excess condemnation is prohibited by section 14% of article I of the California Constitution³ because it is not limited to land lying within 200 feet of the freeway.

The trial court decided in favor of the Rodonis and ordered the complaint dismissed insofar as it seeks to condemn the landlocked parcel. It held that to allow the taking of any land not physically necessary for the freeway would be a taking for other than the public use and that if section 104.1 were construed to allow such a taking it would be unconstitutional. The department then petitioned for a writ of mandate ordering the Merced County Superior Court to proceed with the trial of the original complaint or in the alternative for a writ of prohibition forbidding the court from proceeding in accordance with its order dismissing the complaint in part. (See Tide Water Assoc. Oil Co. v. Superior Court (1955) 43 Cal.2d 815 [279 P.2d 35] ; Financial Indem. Co. v. Superior Court (1955) 45 Cal.2d 395, 399 [289 P.2d 233] ; People ex rel. Dept. Public Works v. Rodoni (1966) 243 Cal.App.2d 771 [52 Cal.Rptr. 857].)

We hold that section 104.1 validly authorizes the trial court to proceed with the action to condemn the 54 acres. We also hold, however, that it must refuse to condemn the property if it finds that the taking is not justified to avoid excessive severance or consequential damages. The latter holding will assure that any excess taking will be for a public use and preclude the department from using the power of excess condemnation as a weapon to secure favorable settlements.

It is for the Legislature to determine what shall be deemed a public use for the purposes of eminent domain, and its judgment is binding unless there is no 11 ‘ possibility the legislation may be for the welfare of the public. ’ ” (Linggi v. Garovotti (1955) 45 Cal.2d 20, 24 [286 P.2d 15], quoting University of Southern Cal. v. Robbins (1934) 1 Cal.App.2d 523, 525-526 [37 P.2d 163] ; see also Housing Authority v. Dockweiler (1939) 14 Cal.2d 437, 449-450 [94 P.2d 794] ; Lux v. Haggin (1886) 69 Cal. 255, 303-304 [4 P. 919, 10 P. 674] ; County of Los Angeles v. Anthony (1964) 224 Cal.App.2d 103, 106 [36 Cal.Rptr. 308] ; Tuolumne Water Power Co. v. Frederick (1910) 13 Cal.App. 498, 503 [110 P. 134].) “Any departure from this judicial restraint would result in courts deciding on what is and is not a governmental function and in their invalidating legislation on the basis of their view on that question at the moment of decision, a practice which has proved impracticable in other fields.” (United States ex rel. T.V.A. v. Welch (1946) 327 U.S. 546, 552 [90 L.Ed. 843, 848, 66 S.Ct. 715].)

Sections 104.1, 104.2, 104.3 and 104.6 of the Streets and Highways Code set forth the purposes for which the department may acquire or condemn property not immediately needed or property not physically needed for state highway purposes. In addition to the excess condemnation authorized by section 104.1, the department may condemn property for nonhighway public uses to be exchanged for property already devoted to such nonhighway uses when the department wishes to acquire the latter property for highway use. (§ 104.2)⁴ It may condemn property adjacent to highways and other public works to be constructed by it and thereafter convey the adjacent property to private parties subject to restrictions protecting the highway or other public use. (§104.3.)⁵ It may also acquire property for future needs and lease such property until it is needed. (§ 104.6.)⁶ None of these sections limits the others, and each “is a distinct and separate authorization.” (§ 104.7.)

Section 104.3 is patterned after section 14% of article I of the California Constitution and, like that section, limits the property to be taken for protective purposes to property lying within 200 feet of the public work. It may be assumed without deciding that the constitutional provision compelled the statutory limitation; that the reference to streets in section 14% includes state highways and that protective condemnations authorized by section 14% are also limited by it. Section 14%, however, does not limit the power of the Legislature to authorize excess condemnation for other than protective purposes. “Because eminent domain is an inherent attribute of sovereignty, constitutional provisions merely place limitations upon its exercise.” (People ex rel. Dept. of Public Works v. Chevalier (1959) 52 Cal.2d 299, 304 [340 P.2d 598].)

Section 14% was adopted in 1928 at a time when the validity of any excess condemnation was doubtful. It was not adopted to limit the power of eminent domain but to authorize condemnations that its sponsors believed would not be permitted under then current rules of constitutional law. (1928 Ballot Pamphlet, Argument for Proposed Senate Constitutional Amend. No. 16.) Although it includes limitations on the condemnations it authorizes and to that extent limits the state’s inherent power of eminent domain, it in no way limits those condemnations that it does not authorize. Accordingly, since it only authorizes condemnations for protective purposes, it does not restrict condemnations for other purposes. (People ex rel. Dept. of Public Works v. Garden Grove Farms (1965) 231 Cal.App.2d 666, 668-673 [42 Cal.Rptr. 118] ; see also State ex rel. Highway Com. v. Curtis (1949) 359 Mo. 402 [222 S.W.2d 64] ; State ex rel. Thomson v. Giessel (1955) 271 Wis. 15, 51-54 [72 N.W.2d 577. 595-597] ; State ex rel. Evjue v. Seyberth (1960) 9 Wis.2d 274, 279-281 [101 N.W.2d 118, 121-122].)

In section 104.1 the Legislature has determined that excess condemnation is for a public use whenever remaining parcels are of little value or in such a condition as to give rise to claims or litigation concerning severance or other damages. Although the statutory language is broad, it may reasonably be interpreted to authorize only those excess condemnations that are for valid public uses; namely, condemnation of remnants (see e.g., Kern County High School Dist. v. McDonald (1919) 180 Cal. 7, 16 [179 P. 180] ; People v. Thomas (1952) 108 Cal.App.2d 832, 836 [239 P.2d 914] ; In re Opinion of Justices (1910) 204 Mass. 616, 619-620 [91 N.E. 578] ; 2 Nichols, Eminent Domain (3d ed. 1963) §7.5122 [1], p. 717) or condemnations that avoid a substantial risk of excessive severance or consequential damages. On the record before us, the taking in the present case is justified on the latter ground.

Although a parcel of 54 landlocked acres is not a physical remnant, it is a financial remnant: its value as a landlocked parcel is such that severance damages might equal its value. Remnant takings have long been considered proper. “The reasoning behind the ‘remnant theory,’ ... is that by limiting the acquisition to only such parts of the property as are needed by the particular improvement, fragments of lots would remain of such shape and size as to render them separately valueless, with the result that the city would be required to pay for the whole, although it took only a part, and with the further result that because of the lack of such value, the city would thereafter be deprived of collecting taxes on these remnants.” (Annot., 6 A.L.R.3d 297, 317 (1966) ; see also, 2 Nichols, Eminent Domain (3d ed. 1963) § 75122 [1] p. 718.) There is no reason to restrict this theory to the taking of parcels negligible in size and to refuse to apply it to parcels negligible in value.

In the present case the entire parcel can probably be condemned for little more than the cost of taking the part needed for the highway and paying damages for the remainder. It is sound economy for the state to take the entire parcel to minimize ultimate costs.

Under these circumstances excess condemnation is constitutional. “The cost of public projects is a relevant element in all of them, and the Government, just as anyone else, is not required to proceed oblivious to elements of costs. [Citations.] And when serious problems are created by its public projects, the Government is not barred from making a common sense adjustment in the interest of all the public.” (United States ex rel. T.V.A. v. Welch, supra, 327 U.S. 546, 554 [90 L.Ed. 843, 849] ; see also United States v. Agee (6th Cir. 1963) 322 F.2d 139; Boston v. Talbot (1910) 206 Mass. 82, 89 [91 N.E. 1014] ; New Products Corp. v. State Highway Comr. (1958) 352 Mich. 73, 86 [88 N.W.2d 528] ; Kern County High School Dist. v. McDonald, supra, 180 Cal. 7, 16; People v. Thomas, supra, 108 Cal.App.2d 832, 836.)

We need not decide in what specific cases other than those mentioned the statute authorizes excess condemnation. It should be emphasized, however, that the economic benefit to the state must be clear. The economic benefit of avoiding the cost of litigating damages is not sufficient. The statute does not authorize excess condemnation anytime the condemnee claims severance or consequential damages. To allow such condemnation would nullify the constitutional guarantee of just compensation (Cal. Const., art. I, § 14) by permitting the state to threaten excess condemnation, not because it was economically sound, but to coerce condemnees into accepting whatever value the state offered for the property actually taken or waiving severance or consequential damages to avoid an excess taking.⁷

As so construed section 104.1 is not an unconstitutional delegation of legislative power. Adequate standards appear in other provisions of the code. Section 102 of the Streets and Highways Code requires the Highway Commission, before authorizing condemnation by the department of any real estate for highway purposes, to make a determination that the “public interest and necessity require the acquisition” and that “the real property or interest therein described in such resolution is necessary for the improvement.”⁸ Section 103 makes the decision of the commission on the necessity of the improvement and of the taking of given property conclusive.⁹ Section 104 provides a nonexclusive list of various purposes for which property is deemed necessary.¹⁰ Only after these other conditions are met does section 104.1 come into play.

The power of eminent domain may be delegated by the Legislature to administrative bodies. (Holloway v. Purcell (1950) 35 Cal.2d 220, 231 [217 P.2d 665].) Discretion cannot be absolute, but “if the delegating statute establishes an ascertainable standard to guide the administrative agents no objection can properly be made to it.” (Wotton v. Bush (1953) 41 Cal.2d 460, 468 [261 P.2d 256].) In the Holloway ease we held that standards found in Streets and Highways Code section 100.2 governing the discretion of the State Highway Commission in fixing the location of freeways were sufficiently definite. Section 100.2 authorizes the commission to approve the location of freeways whenever that location “in its opinion will best subserve the public interest.” The standards found in section 104.1 are no less definite, and are similarly constitutional.

The question remains of the scope of review of the department’s decision to condemn excess property. Section 103 of the Streets and Highways Code makes the determination of the Highway Commission conclusive on the necessity of taking particular land. If the taking is for a public use and just compensation is paid, no constitutional rights of the eondemnee are infringed by making the issue of necessity nonjusticiable. (People ex rel. Dept. of Public Works v. Chevalier, supra, 52 Cal.2d 299; see also Rindge Co. v. County of Los Angeles (1923) 262 U.S. 700, 708-710 [67 L.Ed. 1186, 1193-1194, 43 S.Ct. 689].)

The issue of whether a taking is for a public use, however, is justiciable. (People ex rel. Dept. of Public Works v. Chevalier, supra, 52 Cal.2d 299.) The distinction between the scope of review of the questions of public use and necessity was properly recognized in People ex rel. Dept. of Public Works v. Lagiss (1963) 223 Cal.App.2d 23, 39 [35 Cal.Rptr. 554] : ‘ ‘ The necessity for the construction of a highway at the place designated and in the manner determined by the Commission, together with the amount of land required therefor, are matters which were conclusively established by the adoption of the resolution [of necessity]. The question as to whether the land was to be devoted to a public use, however, as distinguished from private purposes or to accomplish some purpose which is not public in character, became a proper issue for the judicial determination of the court. ’ ’ To raise an issue of improper excess taking, eondemnees -must show that the condemner is guilty of “fraud, bad faith, or abuse of discretion in the sense that the condemner does not actually intend to use the property as it resolved to use it” (People ex rel. Dept. of Public Works v. Chevalier, supra, 52 Cal.2d 299, 304), or that the contemplated use is not a public one (see also People ex rel. Dept. of Public Works v. Lagiss, supra, 223 Cal.App.2d 23, 35-44; Yeshiva Torath Emeth Academy v. University of Southern Cal. (1962) 208 Cal.App. 2d 618, 619-620 [25 Cal.Rptr. 422] ; County of San Mateo v. Bartole (1960) 184 Cal.App.2d 422, 430-434 [7 Cal.Rptr. 569] ; People ex rel. Dept. of Public Works v. Nahabedian (1959) 171 Cal.App.2d 302, 306-309 [340 P.2d 1053]).

When, as in this ease, the property is not needed for the physical construction of the public improvement, the question of public use turns on a determination of whether the taking is justified to avoid excessive severance or consequential damages. Accordingly, if the court determines that the excess condemnation is not so justified, it must find that it is not for a public use.

Let a writ of mandate issue ordering the trial court to proceed with the trial of the case under the original complaint in accordance with the views expressed herein.

McComb, J., Tobriner, J., Burke, J., and Sullivan, J., concurred.

1 “ Whenever a part of a parcel of land is to be taken for State highway purposes and the remainder is to be left in such shape or condition as to be of little value to its owner, or to give rise to claims or litigation concerning severance or other damage, the department may acquire the whole parcel and may sell the remainder or may exchange the same for other property needed for State highway purposes. ’ ’

2 California Constitution article I, section 14: “Private property shall not be taken or damaged for public use without just compensation having first been made to, or paid into court for, the owner. ...”

3 “The State, or any of its cities or counties, may acquire by gift, purchase or condemnation, lands for establishing, laying out, widening, enlarging, extending, and maintaining memorial grounds, streets, squares, parkways and reservations in and about and along and leading to any or all of the same, providing land so acquired shall be limited to parcels lying wholly or in part within a distance not to exceed one hundred fifty feet from the closest boundary of such public works or improvements; provided, that when parcels which lie only partially within said limit of one hundred fifty feet only such portions may be acquired which do not exceed two hundred feet from said closest boundary, and after the establishment, laying out and completion of such improvements, may convey any such real estate thus acquired and not necessary for such improvements, with reservations concerning the future use and occupation of such real estate so as to protect such public works and improvements and their environs and to preserve the. view, appearance, light, air and usefulness of such public works.

(‘ The Legislature may, by statute, prescribe procedure. ’ ’

4 ‘ ‘ Whenever property which is devoted to or held for some other public use for which the power of eminent domain might be exercised is to be taken for State highway purposes, the department may, with the consent of the person or agency in charge of such other public use, condemn, in the name of the people of the State of California, real property to be exchanged with such person or agency for the real property so to be taken for State highway purposes. This section does not limit the authorization to the department to acquire, other than by condemnation, property for such purposes. ’ ’

5 “ The department may condemn real property or any interest therein for reservations in and about and along and leading to any State highway or other public work or improvement constructed or to be constructed by the department and may, after the establishment, laying out and completion of such improvement, convey out [sic] any such real property or interest therein thus acquired and not necessary for such improvement with reservations concerning the future use and occupation of such real property or interest therein, so as to protect such public work and improvement and its environs and to preserve the view, appearance, light, air and usefulness of such public work; provided, that land so condemned under authority of this section shall be limited to parcels lying wholly or in part within a distance of not to exceed one hundred fifty feet from the closest boundary of such public work or improvement; provided that when parcels which lie only partially within such limit of one hundred fifty feet are taken, only such portions may be condemned which do not exceed two hundred feet from said closest boundary. ’ ’

6 “The authority conferred by this code to acquire real property for state highway purposes includes authority to acquire for future needs. The department is authorized to lease any lands which are held for state highway purposes and are not presently needed therefor on such terms and conditions as the director may fix and to maintain and care for such property in order to secure rent therefrom. ...”

7 Nor does section 104.1 authorize excess condemnation for recoupment purposes, as the term is used in those cases that disfavor it. The statute does not authorize the state to condemn for the sole purpose of taking lands enhanced by the improvement in order to recoup that increase in value or for the sole purpose of developing the area adjacent to the improvement for a profit. (See Annot., 6 A.L.R.3d 297, 311-314.) The department’s purpose is to avoid the windfall to the condemnee and the substantial loss to the state that results when severance damages to a severed parcel are equal to its value.

8 Streets and Highways Code section 102: “In the name of the people of the State of California, the department may condemn for State highway purposes, under the provisions of the Code of Civil Procedure relating to eminent domain, any real property or interest therein which it is authorized to acquire. The department shall not commence any such proceeding in eminent domain unless the commission first adopts a resolution declaring that public interest and necessity require the acquisition, construction or completion by the State, acting through the department, of the improvement for which the real property or interest therein is required and that the real property or interest therein described in such resolution is necessary for the improvement.”

9 Streets and Highways Code section 103: “The resolution of the commission shall be conclusive evidence: (a) Of the public necessity of such proposed public improvement, (b) That such real property or interest therein is necessary therefor, (c) That such proposed public improvement is planned or located in a manner which will be most compatible with the greatest public good and the least private injury.”

10 Streets and Highways Code section 104: “The department may acquire, either in fee or in any lesser estate or interest, any real property which it considers necessary for State highway purposes. Beal property for such purposes includes, but is not limited to, real property considered necessary for any of the following purposes: [Herein are listed such purposes as rights of way, offices, parks adjoining the highway, landscaping, drainage, maintenance, etc.]” ........