Olson v. United States

STONE, Circuit Judge.

These are three separate appeals by landowners from judgments awarding damages in a condemnation proceeding prosecuted by the United States against the lands of each.

These lands border the Lake of the Woods, which is a large body of water partly in the state of Minnesota and partly in Canada. The surface area of the lake is approximately 1,500 square miles with its outlet, by the Winnipeg river, in Canada. There are natural water power sites along that river. In order to utilize and develop these power possibilities, it is necessary to regulate the outflow of the water from the lake so as to maintain a dependable, uniform rate of flow during all seasons. This regulation of outflow must be secured by dams by which the flow can be controlled. The effect of such a dam is to restrain the outflow, to use the lake as a sort of reservoir, and to raise the natural level of the lake. A raised level overflows shore lands. The lands involved here are shore lands so affected and it is this character of damage or taking which is in question.

In 1898, the Keewatin Power Company (a Canadian corporation) constructed, for power purposes, such a control dam in Canada, near Kenora. It utilized the. lake as a reservoir and caused an average rise in the lake level of about three feet with resulting invasion of the shore lands. This flooding of shore lands has intermittently continued since 1898 and is substantially the level to be maintained hereafter. No damages were paid f<?r this overflowing' of lands.

In 1909, a treaty was made between the United States and Great Britain “relating to boundary waters” (Jan. 11, 1909, 36 Stat. part 2, p. 2448). This treaty established an International Joint Commission which, within defined limits, was given jurisdiction over “all cases involving the use or obstruction or diversion of the waters” (article 8 of treaty) covered by articles 3 and 4 of the treaty and respecting which those two articles required the approval of the commission. This jurisdiction expressly included “uses for power * , * purposes” (art. 8). This treaty was general and did not specifically mention the Lake of the Woods.

The commission was organized and the Lake of the Woods situation was referred to it. The final report (May 18, 1917) of the commission was submitted to the two governments and resulted in the “Treaty and protocol * * * to regulate the level of the Lake of the Woods” (July 17,1925, 44 Stat. part 3, p. 210-8). This treaty provided that “the level of Lake of the Woods shall ordinarily be maintained between elevations 1056 and 1061.25 sea level datum, and between these two elevations the regulation shall be such as to ensure the highest continuous uniform discharge of water from the lake” (article 4). There were other provisions applying to exceptional water conditions. An International Lake of the Woods Control Board was established to secure maintenance of the levels provided in the treaty. In article 8 is a provision that: “A flowage easement shall be permitted up to elevation 1064 sea level datum upon all lands bordering on Lake of the W.oods in the United States, and the United States assumes all liability to the owners of such lands for the costs of such easement.” Article 9 provided:

“The United States and the Dominion of Canada shall each on its own side of the boundary assume responsibility for any damage or injury which may have heretofore resulted to it or to its inhabitants from the fluctuations of the level of Lake of the Woods or of the outflow therefrom.

“Each shall likewise assume responsibility for any damage or injury which may hereafter result to it or to its inhabitants from the regulation of the level of Lake of the Woods in the manner provided for in, the present Convention.”

To carry into effect this Convention of 1925, the Act of May 22,1926 (44 Stat. part 2, p. 617) and an amendatory act (April 18, 1928, 45 Stat. 431) were passed. These two acts provided that the Secretary of War should investigate and report to Congress on claims for “damages caused, prior to the acquisition of flowage easements under this Act.” The secretary was required to acquire, by purchase or condemnation, “the flowage easements up to elevation one thousand and sixty-four sea-level datum upon all lands in such State [Minnesota] bordering on the Lake of the Woods, Warroad River, and Rainy River.” Such condemnations were to be in accordance with the Act of August 1, 1888 (25 Stat. 357 [40 USCA §§ 257, 258]) and “with the constitutional provisions of the State of Minnesota which provide that private property shall not be taken, destroyed, or damaged for public use without just compensation therefor first paid or secured.”

Being unable to secure these flowage rights upon various tracts by purchase, a condemnation proceeding was', instituted, which included lands owned by these appellants. Commissioners were appointed to assess damages to the several tracts sought to be condemned and reported damages as to each. Both the United States and each of these appellants appealed from the awards of the commissioners. The appeals as to the tracts owned by these three appellants were, by agreement and order, consolidated for trial before a jury. Erom judgments of awards of damages as to the tracts owned by each of these appellants each of them has brought his separate appeal. They are consolidated for hearing and determination in this court.

But one main issue is involved in these appeals. It is raised in the record in various ways — by exclusion of evidence, refusal to charge, and the charge to the jury. The issue is whether the use of these properties for flowage purposes is such) a use as, under the circumstances here, can be considered as an element of that value for which compensation must be made. Appellants present their argument under three distinct points, each of which has the same purpose and effect — -to allow compensation for this flowage use value.

Point I is that this reservoir or flowage easement was at the time of taking under this action and for years before had been an existing, established easement; that it was a “unit” of value of the land; that it was such “unit” alone which was taken and, therefore, that the measure of value for compensation should be the value of this taken unit and not the difference between the values of the entire tract before and after taking under this action. Point II is that, whatever measure of value (either the above unit or the above difference) be applied, the taking of this existing and established use is a proper element of value in damages and compensation because such use existed at, prior to and independent of this condemnation, is such as may be advantageously employed by others than this condemnor and is such as naturally would or actually has increased the market value of the property. Point III is that the fair annual rental value of the flowage use is an element in compensation for taking of such use. All of these matters have been presented by counsel upon both sides with great ability and with commendable clearness and fairness. About all that could have been put before us, both for and against, has been presented and the court has been materially aided thereby.

I. The Unit Measure.

The brief of appellants reads: “Appellants urge that compensation for property taken, rather than damage to their remaining estate, be employed as the measure of their compensation, because it is more consistent with sound reasoning, and because it more clearly points out the error of the trial court” — that error being “the exclusion of all evidence of the most valuable use [flow-age] which their property has served for thirty years and for which it is adaptable.” The discussion, by appellants, of this urged measure of compensation may be helpful in scrutinizing the claimed erroneous action of the trial court, but the vital inquiry under this “point” is whether “it is more consistent with sound reasoning” to employ this unit measure of value.

The reasoning of appellants is that the “orthodox method of assessing just compensation is to determine the value of the whole property before and after the taking and compute the difference”; that this method came into practice in condemnations of rights of way for roads or railroads under circumstances which did not require the taking of the entire property affected; that “a different rule obtains where the entire unit of property is taken”; that the unit rule applies “where the property taken is a separate unit or species of property, and is capable of being acquired and transferred independently of the land on which it may be located”; that “easements of all kinds are dealt with in the law as property, separate and distinct, just the same as any other item of property”; that the matter here dealt with is a “flowage easement”; that flowage rights and reservoirs are listed and valued for rate and taxation purposes, are sold and dealt in as separate units, and conveyances thereof are recorded as such under the laws ■ of Minnesota; that it is “good business and sound economics to treat storage reservoirs and flowage easements as separate units of property”; and that, as to this particular easement, it appears that it is a complete, existing unit of property and has been for thirty years, is being condemned for identically the same use it has served for that period, will be perpetually so used, the entire unit is taken and appellants have expressly waived all claim for damages to their remaining property.

In the examination of adjudicated eases, it is suggested that, as to some, there has been confusion and failure to distinguish “between compensation for property talcen when it is all taken, and damages to the remaining estate when the property is not all taken.” It is urged that here “all of the flow-age rights, and all of the flowage property belonging to appellants is being taken, and appellants have expressly waived all claims for damage to their remaining property; also, that it is important to distinguish between easements long in existence and use before condemnation and easements brought into being by such proceedings.”

“Sound reasoning,” as employed here, must be understood, of course, in a legal sense. As to this, appellants properly admit that the “orthodox method of assessing just compensation is to determine the value of the whole property before and after the taking and compute the difference.” However, they contend that “a different rule obtains where the entire unit of property is taken,” that an entire unit of property is (in this sense) taken where it is “capable of being acquired and transferred independently of the land on which it may be located," and all of such unit is taken and that this easement is of that character.

It must be conceded that there are many kinds of easements which are capable of being acquired and transferred independently of the land on which they may be located. Also, that flowage easements aré of that character. As to all of the flowage right (treated here as a “unit”) being taken, the record does not support such assertion. It is clear that flowage rights are taken to the extent needed by this improvement, but the record tends rather to support the view that there existed other flowage rights beyond (higher than) those taken — otherwise, why the provisions of the treaty limiting the maximum flowage (Treaty and Protocol of February 24, 1025, arts. 4, 7, 8, 44 Stat. 2108) and appointing a Control Board (arts. 3, 5) to supervise the water levels. At least it is eertain there is no showing here that the maximum flowage level of this taking is the entire possible flowage level of the lands. Thus while it is not shown that all of the possible flowage rights of these lands are taken, yet the situation is one of a flowage easement capable of separate acquisition and transfer. Does this situation bring this easement within a rule of separate unit valuation for condemnation purposes? Appellants cite International Paper Co. v. United States, 282 U. S. 399, 51 S. Ct. 176, 75 L. Ed. 410; United States v. Cress, 243 U. S. 316, 37 S. Ct. 380, 61 L. Ed. 746; Carondelet Canal & Nav. Co. v. Louisiana, 233 U. S. 362, 388, 34 S. Ct. 627, 58 L. Ed. 1001; Adams v. C. B. & N. Ry. Co., 39 Minn. 286, 290, 39 N. W. 629, 1 L. R. A. 493, 12 Am. St. Rep. 644; 1 Dunnell’s Minn. Digest, § 3057; 20 C. J. 593; and 20 C. J. 655’. International Paper Co. v. United States, 282 U. S. 399, 51 S. Ct. 176, 75 L. Ed. 410, was a suit for damages by a lessee of water flowage right for the taking thereof. The only thing, taken was the only thing owned by the plaintiff, to wit, the right to water flowage under its lease. The “unit” was the subject of separate ownership by that plaintiff. United States v. Cress (also U. S. v. Kelly et al.), 243 U. S. 316, 37 S. Ct. 380, 61 L. Ed. 746, were eases for damages from flowage caused through water raised by dams. It was held (Cress Case) that as to certain lands intermittently overflowed the taking constituted an easement (page 329 of 243 U. S., 37 S. Ct. 380, 61 L. Ed. 746); that as to destruction of a ford and private right of way thereto recovery could be had therefor as damage to the land to which it was appurtenant, (page 329 of 243 U. S., 37 S. Ct. 380, 61 L. Ed. 746); that (Kelly Case) the right to unobstructed flow away from a mill dam “is not a mere easement or appurtenance” and destruction of such right is “a taking of a part of the land” (page 330 of 243 U. S., 37 S. Ct. 380, 386, 61 L. Ed. 746). Carondelet Canal So Navigation Co. v. Louisiana, 233 U. S. 362, 34 S. Ct. 627, 58 L. Ed. 1001, involved the question of impairment of a contract by state legislation. This depended upon whether a contract between the state and the company provided for eompensation by the state when it took over a canal and related works constructed and operated by the company for fifty years under the contract. No issue of eminent domain was involved. The expression in the opinion, intended by citation of appellants, is (page 388 of 233 U. S., 34 S. Ct. 627, 635, 58 L. Ed. 1001): “It may be that it did not own the canal, or the bayou, or the old basin. Indeed, ownership of their soil was disclaimed at the bar. But, we repeat, there was valuable property which the statute contemplated could revert and could be compensated for. Monongahela Navigation Co. v. United States, 148 U. S. 312,13 S. Ct. 622, 37 L. Ed. 463.” Here the entire property and title thereto was in the company, separate from the ownership of the land, and that entirety was the unit for which the company was entitled to compensation. Adams v. C. B. & N. Ry. Co., 39 Minn. 286, 39 N. W. 629, 1 L. R. A. 493, 12 Am. St. Rep. 644, was an action for damages to property through operation of a railway along the street in front. The holding was that plaintiff had an easement for light and air to this lot and, for deprivation thereof, he could recover damages to the lot. Dunnell’s Digest, § 3037, is a statement that “an easement is property and may be ‘taken’ within the meaning of the C'onstitution,” citing the Adams Case, supra. 20 C. J. 593, § 83, and 655, § 131, recognize easements appurtenant to land as property subjeet to eminent domain. The result of these citations is not to sustain the contention of appellants that where an easement is capable of separate acquisition and transfer it is a unit for condemnation valuation purposes. The rule is that an easement is such unit only where, prior to condemnation, it has been severed in ownership from the fee. International Paper Co. v. United States, 282 U. S. 399, 51 S. Ct. 176, 75 L. Ed. 410. Even though the ownership of the easement has been severed from the ownership of the land upon which it is imposed, the easement is not such unit if it is appurtenant to — enjoyed in connection with — land of the owner of the easement. In such eases, the damage for taking is the injury to the land to which it is thus appurtenant. United States v. Cress, 243 U. S. 316, 329, 37 S. Ct. 380, 61 L. Ed. 746 (ford and right of way thereto); United States v. Grizzard, 219 U. S: 180, 185, 31 S. Ct. 162, 55 L. Ed. 165, 31 L. R. A. (N. S.) 1135; United States v. Welch, 217 U. S. 333, 339, 30 S. Ct. 527, 54 L. Ed. 787, 28 L. E. A. (N. S.) 385, 19 Ann. Cas. 680. In the Welch Case (page 339 of 217 U. S., 30 S. Ct. 527,54 L. Ed. 787, 28 L. E. A. (N. S.) 385; 19 Ann. Cas. 680) the court said: “ * * * the value of the easement cannot be ascertained without reference to the dominant estate to which it was attached.” This criterion of separate ownership is further illustrated in, Sharp v. United States, 191 U. S. 341, 351-356, 24 S. Ct. 114, 48 L. Ed. 211, where several entirely separate tracts were owned by the same person and one only was taken, and in Boston Chamber of Commerce v. Boston, 217 U. S. 189, 30 S. Ct. 459, 54 L. Ed. 725, where several different characters of ownerships endeavored to combine in seeking damages to the tract. In the latter ease (page 195 of 217 U. S., 30 S. Ct. 459, 460, 54 L. Ed. 725) the court said: “But the Constitution does not require a disregard of the mode of ownership, — of the state of the title. It does not require a parcel of land to be valued as an unencumbered whole when it is not held as an unencumbered whole. It merely requires that an owner of property taken should be paid for what is taken from him. It deals with persons, not with tracts of land.”

Application of the above-established principle to the situation here must result in ruling this point I against appellants because there is here neither separate ownership nor separate tract of land taken.

II. Flowage Use.

Appellants’ second and main contention; is that the flowage use of their lands for power reservoir purposes is an element of value proper to be considered in determining the damage from this taking. They contend that the uses to which land taken may be applied are properly and always considered as elements of value; that this flowage use existed at the time of this taking and had for years prior thereto; that such is the most valuable use of the lands; and that such use naturally tends to and actually has affected the market value of these lands. The position of the government is that all of the above considerations are overridden for the reasons that any influence of flowage use on the value of these lands was impossible because the union of the properties necessary to this improvement was impracticable save by international agreement and eminent domain; because of the impossibility of obtaining authority to regulate lake levels for power purposes; because control of the lake outlets was necessary .for any enjoyment of this use for power purposes and possibility of acquiring such control was removed by appropriation thereof by the Canadian government, since 1898, for navigation purposes; and because thet right of flowage upon these lands had been reserved by the United States in the laws under which these lands were opened for entry. [3,4] In so far as is necessary for a determination of this matter, the law applicable thereto is as follows. The Fifth Amendment provides, “nor shall private property be taken for public use, without just compensation.” “Compensation” means recompense or “equivalent” (Monongahela Nav. Co. v. United States, 148 U. S. 312, 326; 13 S. Ct. 622, 37 L. Ed. 463) to the owner and has no relation to advantage to the taker (United States v. Chandler-Dunbar, etc., Co., 229 U. S. 53, 76, 33 S. Ct. 667, 57 L. Ed. 1063; McGovern v. N. Y., 229 U. S. 363, 371, 33 S. Ct. 876, 57 L. Ed. 1228, 46 L. E. A. [N. S.] 391; United States v. Grizzard, 219 U. S. 180, 183, 31 S. Ct. 162, 55 L. Ed. 165; 31 L. E. A. [N. S.] 1135; Boston Chamber of Commerce v. Boston, 217 U. S. 189, 195, 30 S. Ct. 459, 54 L. Ed. 725; Monongahela Nav. Co. v. United States, 148 U. S. 312, 343, 13 S. Ct. 622, 37 L. Ed. 463). “Just” means a fair money equivalent for what is taken — its fair money value. Where there is an actual current market value for things of the kind taken, that, naturally, fixes the fair money value. Davis v. George B. Newton Coal Co., 267 U. S. 292, 301, 45 S. Ct. 305; 69 L. Ed. 617; United States v. New River Collieries Co., 262 U. S. 341, 43 S. Ct. 565; 67 L. Ed. 1014; Vogelstein & Co. v. United States, 262 U. S. 337, 43 S. Ct. 564, 67 L. Ed. 1012. However, most condemnations are of real estate or of interests therein where conditions as to valuation are different (Sharp v. United States, 191 U. S. 341, 349, 350, 24 S. Ct. 114, 48 L. Ed. 211) and no such actual market value exists. However, “market value” is still the standard (De Laval, etc., Co. v. United States, 284 U. S. 61, 72, 52 S. Ct. 78, 76 L. Ed. 168; McCoy v. Union Elev. R. R. Co., 247 U. S. 354, 365, 38 S. Ct. 504, 62 L. Ed. 1156; United States v. Chandler-Dunbar, etc., Co., 229 U. S. 53, 81, 33 S. Ct. 667, 57 L. Ed. 1063; United States v. Grizzard, 219 U. S. 180,183, 31 S. Ct. 162, 55 L. Ed. 165, 31 L. R. A. [N. S.] 1135), but it must be determined otherwise than by current market prices. In such situations, the definition of market value is “the sum that would in all probability result from fair negotiations between an owner who is willing to sell and a purchaser who desires to buy.” De Laval, etc., Co. v. United States, 284 U. S. 61, 73, 52 S. Ct. 78, 80, 76 L. Ed, 168; Brooks-Scanlon Corporation v. United States, 265 U. S. 106, 123, 44 S. Ct. 471, 68 L. Ed. 934. The time for which the value is determined is the time of taking (De Laval Co. v. United States, 284 U. S. 61, 72, 52 S. Ct. 78, 76 L. Ed. 168; Phelps v. United States, 274 U. S. 341, 344, 47 S. Ct. 611, 71 L. Ed. 1083; Brooks-Scanlon Corporation v. United States, 265 U. S. 106, 123, 125; 44 S. Ct. 471, 68 L. Ed. 934; Vogelstein & Co. v. United States, 262 U. S. 337, 43 S. Ct. 564, 67 L. Ed. 1012; Monongahela Nav. Co. v. United States, 148 U. S. 312, 341, 13 S. Ct. 622, 37 L. Ed. 463), and this is unaffected by an unlawful taking prior to and existing at the time of lawful taking (Searl v. School District, 133 U. S. 553, 10 S. Ct. 374, 33 L. Ed. 740).

In using this defined standard no account is given to values or necessities peculiar to the seller (Mitchell v. United States, 267 U. S. 341, 344, 345, 45 S. Ct. 293, 69 L. Ed. 644; Monongahela Nav. Co. v. United States, 148 U. S. 312, 326, 13 S. Ct. 622, 37 L. Ed. 463), or the buyer (United States v. Chandler-Dunbar Co., 229 U. S. 53, 76, 33 S. Ct. 667, 57 L. Ed. 1063; McGovern v. N. Y., 229 U. S. 363, 371, 33 S. Ct. 876; 57 L. Ed. 1228, 46 L. R. A. [N. S.] 391; Boston Chamber of Commerce v. Boston, 217 U. S. 189, 195, 30 S. Ct. 459, 54 L. Ed. 725), but only such matters as would affect the ordinary seller and buyer in negotiating a fair price. In reality the result sought and reached is what the trier of fact finds is a fair sales value. To reach this result, such trier may consider all matters which would naturally influence agreement upon a price by sellers and buyers willing but not compelled to bargain. Obviously, the uses to which property may be put vitally affect its value. But “use” in this sense does not mean mere physical adaptability. A square block of firm land anywhere in the United States is physically adapted to support a towering office building, but very few have any value for that purpose. It is use adaptability which concerns us. Since value is to be determined as of the time of taking, it is use adaptability apparent at that time. Since market value is the standard sought, it is use adaptability which would affect market value at the time of taking — that is, which would influence a seller and a buyer in arriving at a fair price then. The above considerations limit the uses which may be shown. Such uses include not only present use (Phelps v. United States, 274 U. S. 341, 344, 47 S. Ct. 611, 71 L. Ed. 1083; Mitchell v. United States, 267 U. S. 341, 344, 345; 45 S. Ct. 293, 69 L. Ed. 644; Hanson Lumber Co. v. United States, 261 U. S. 581, 590, 43 S. Ct. 442, 67 L. Ed. 809; Monongahela Nav. Co. v. United States, 148 U. S. 312, 328^330, 13 S. Ct. 622, 37 L. Ed. 463),.but other uses. The difficulty in many adjudicated cases has been to determine when potential uses may be shown. Since they must- be such as would influence market value at the time of taking, the Supreme Court has ruled that they must be “probable * * • within some reasonable time” (Sharp v. United States, 191 U. S. 341, 356, 357, 24 S. Ct. 114, 118, 48 L. Ed. 211) or “probably be desired and available for” (United States v. Chandler-Dunbar, etc., Co., 229 U. S. 53, 77, 33- S. Ct. 667, 677, 57 L. Ed. 1063) or “considerable enough to be a practical consideration and actually to influence prices” (McGovern v. N. Y., 229 U. S. 363, 372, 33. S. Ct. 876, 877, 57 L. Ed. 1228, 46 L. R. A. [N. S.] 391), but cannot be such as are “speculative, remote, and not shown to be commercially practicable” (United States v. Coronado Beach Co., 255 U. S. 472, 488, 41 S. Ct. 378, 380, 65 L. Ed. 736) nor “too remote and speculative to have any legitimate effect upon the valuation” (McGovern v. N. Y., 229 U. S. 363; 372, 33 S. Ct. 876, 877, 57 L. Ed. 1228, 46 L. R. A. [N. S.] 391). Whether a potential use is such as may be shown within the above definitions, naturally, depends largely upon the circumstances of each situation (McGovern v. N. Y., 229 U. S. 363, 373, 33 S. Ct. 876, 57 L. Ed. 1228, 46 L. R. A. [N. S.] 391), but one factor is “demand for the use” (Monongahela Nav. Co. v. United States, 148 U. S. 312, 328, 13 S. Ct. 622, 627, 37 L. Ed. 463; Kerr v. South Park Comm., 117 U. S. 379, 387, 6 S. Ct. 801, 29 L. Ed. 924). Also, and particularly pertinent to our case, where the use depends upon assembly of numerous tracts separately owned the probability of uniting or acquiring all of them necessary to the use is an important — maybe a controlling —consideration in determining whether the use is “too remote and speculative to have any legitimate effect upon the valuation” (McGovern v. N. Y., 229 U. S. 363, 372, 33 S. Ct. 876, 877, 57 L. Ed. 1228, 46 L. R. A. [N. S.] 391, and, see, United States v. Chandler-Dunbar, etc., Co., 229 U. S. 53, 80, 33 S. Ct. 667, 57 L. Ed. 1063), and “In estimating that probability, the power of effecting the change by eminent domain must be left out” (McGovern v. N. Y., 229 U. S. 363, 372, 33 S. Ct. 876; 877, 57 L. Ed. 1228-, 46 L. R. A. [N. S.] 391, and see United States v. Chandler-Dunbar, etc., Co., 229 U. S. 53, 80, 81, 33 S. Ct. 667, 57 L. Ed. 1063). The things we deem material to bear in mind in the foregoing statement of the law are that existing uses influence values; that potential uses are not considered if they are remote and speculative; that they are remote and speculative if the use depends upon the union of numerous tracts, variously owned, and such union is improbable; and that in determining such probability the power of eminent domain must be excluded.

With these matters in mind we turn to the facts here. Appellants press strongly the fact that this use at the time of and for years prior to the taking in this condemnation was an actual existing use. That is true. Was the use here of the character and within the proper intendment of the decisions or, outside of those decisions, is it'logieally to be regarded as a use which would influence market value of these lands? The decisions above cited as to actual use at the time of taking (and there are many others from various courts) all have to do with a use by the owner which would pass to a buyer of the land and of which the owner is deprived by the taking. The actual use here is through an unlawful trespass. Seeombe v. Milwaukee & St. Paul Railroad Co., 23 Wall. 108, 118, 23 L. Ed. 67. This trespass established the physical adaptability of the lands for this flowage for power purposes. What effect had the establishment of such fact upon the sales value of the lands which would influence a seller and buyer of such at the time of this taking? EOr more than thirty years, these lands had borne the burden of this trespass to their detriment without hope of redress. There was no such hope because this trespass was occasioned by works erected in the outlet of the lake within a foreign territory by a foreign company acting under authority of the foreign government. During that entire time there could exist no value to the owner or to a prospective buyer in this use of flowage. It was a positive reducer of value. It rendered part of the land unfit for any purpose to the owner or such a buyer. Nor was there any hope of compensation for continued usage which could possibly have added to the sales value of the land. It was a peculiar and unfortunate situation where the landowner was helpless. There was no demand for this use by anyone who would or could be made to compensate him therefor. It had been appropriated under circumstances which were beyond his power to remedy. Then there came a change. Opening the matter by the general Treaty of 1909, the government sought to cure this unjust situation by the Convention of 1925. This it did by assuring the levels of the lake (the measure of intrusion upon the lands) and by voluntarily assuming to pay compensation therefor. It was not until the Convention of 1925¹ that there was any possibility of the landowner receiving any compensation for this taking of his land. Nor has there been before or since any possibility of any other demand for such use. In this situation (which existed at the time of this condemnation taking), it seems to us, justice to the landowner and to the public¹ would demand that this flowage use be excluded from estimation of sales value of the lands unless it can he seen that such use was properly an element of such value, irrespective of these actualities. In other words, if such use was properly an element of such value before this trespass then it continued to be such in spite thereof and should he taken into account — otherwise not. We think it should not be so regarded for the reasons following.

At the time of this taking by condemnation, the Lake of the Woods covered about 1,500 square miles. The shore line (main shore and islands) is estimated at 3,093 miles (United States 188, Canada 2,905) o-r 2,225 miles (United States 140, Canada 2,085). Lands affected by the condemnation flowage level comprise a great number of separate tracts variously owned. In Canada: 15,000 acres are owned by the Province of. Ontario, 16,000 acres by the dominion (in Manitoba), over 30 tracts are Indian reservations, and there are 723 tracts privately owned. The Canadian public lands had been withdrawn from settlement some years with a view to this character of improvement. In the United States: The United States owned something less' than 11,000 acres, the state of Minnesota owned one fair-sized tract, 850 tracts were privately owned by about 775 owners; with over 1,200 other persons having legal interests (mortgagees, etc.) therein. Added to the considerations of multiplicity of tracts and ownership are the patent difficulties of successfully dealing with various governmental units and Indian tribes. To assemble all of this flowage affected land would require acquisition of the rights of this great number of persons (including two nations, one state, two provinces, Indian tribes, and private persons) in this large number of separately and variously owned tracts. We cannot think that such an eventuality held that degree of probability or possibility which could affect the value of these lands and be an influence or consideration affecting, in the slightest degree, the minds of sellers and buyers thereof in arriving at a fair price therefor. Such use is too remote and speculative to have such effect in faet and, therefore, can have none in law.

To this it may be said that the rejected offer of proof was to show that prices had actually been so affected. That prices of these privately owned lands would be affected by the prospect of purchase or condemnation of the flowage rights under the Convention of 1925 is entirely probable and natural. Before that convention, such at tract of land would be worth only its usage for agricultural or fishing purposes with the burden of the flowage actually there and the most which could be vaguely hoped for would be the removal of the flowage and the resultant use, for the above purposes, of the overflowed land. With the convention came the certainty of compensation for the overflowed land. To the extent of this compensation, the value of the lands would be increased to the owner and, therefore, would be a factor in| sales price thereof. Beyond this, there is no vestige of reason for an increase. Even if owners and buyers might actually have thought that this compensation would include an enhancement from use for flowage purposes, there was no justification in law for such view. Such thought could spring only from the convention which had in mind this very improvement and values arising because of the particular improvement cannot be included in compensation. McCoy v. Union Elev. R. Co., 247 U. S. 354, 366, 38 S. Ct. 504, 62 L. Ed. 1156; United States v. Chandler-Dunbar, etc., Co., 229 U. S. 53, 76, 77, 80, 33 S. Ct. 667, 57 L. Ed. 1063; Monongahela Nav. Co. v. United States, 148 U. S. 312, 326,13 S. Ct. 622, 37 L. Ed. 463 ; Shoemaker v. United States, 147 U. S. 282, 305, 13 S. Ct. 361, 37 L. Ed. 170; Kerr v. South Park Comm., 117 U. S. 379, 386; 387, 6 S. Ct. 801, 29 L. Ed. 924. Also, this convention clearly provided for accomplishment of acquisition through eminent domain and where the use is possible only through the exercise of that power, “it must be left out” (McGovern v. N. Y., 229 U. S. 363, 372, 33 S. Ct. 876; 57 L. Ed. 1228, 46 L. R. A. [N. S.] 391) in estimating the probability of such a use as affecting sales value and compensation. With no further examination of the difficulties urged by appellee, we think the trial court correctly excluded consideration of this flow-age use as an element of value. i

III, Rental Value.

In view of what has been above determined as to point II, little need be said as to the contention of appellants that the annual rental value of this flowage use was improperly denied consideration. This suit is not concerned with compensation for the use of flowage rights prior to the taking under this condemnation. That is a different situation under rules of law (Secombe v. Railroad Co., 23 Wall. 108, 118; 23 L. Ed. 67; Searl v. School District, 133 U. S. 553; 564, 10 S. Ct. 374, 33 L. Ed. 740) and, under the Convention of 1925, art. 9, is to be eared for by a separate and different method. The problem in. this action is whether flowage use value is ■ a proper element of sales-markebvalue to be considered in determining the compensation due the landowners. If (as we have above held) this use cannot be properly considered, it is obvious that we are' not concerned with any method of estimating the value of such denied use. Annual rental value thereof has no other purpose either in faet or in the decisions cited by appellants.

Conclusion.

The judgments must be, and are, affirmed.

1 Compensation must be just not only to tbe landowner but to the public (Searl v. School District, 133 U. S. 553, 562, 10 S. Ct 374, 33 D. Ed. 740; Garrison v. City of N. Y., 21 Wall. 196, 204, 22 D. Ed. 612), and all of tbe circumstances and elements at tbe time of taking must be considered (Brooks-Scanlon Corporation y. United States, 265 U. S, 106, 123, 124,. 125, 126, 44 S. Ct. 471, 68 L. Ed. 934).