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February 20, 1962

UNITED STATES of America, Petitioner-Plaintiff,
284,392 SQUARE FEET OF FLOOR SPACE IN the property known as 227-237 SCHERMERHORN STREET, AND 240-252 LIVINGSTON STREET, BOROUGH OF BROOKLYN, COUNTY OF KINGS, CITY AND STATE OF NEW YORK, and Martin S. Goldring, Hyman J. Sobiloff, Gabriel Lavine, Samuel A. Strassler; Unknown Owners, Defendants

The opinion of the court was delivered by: BARTELS

This is an action brought by the Government to take property under the power of eminent domain. The complaint filed on September 26, 1961, alleges that the action was instituted at the request of the Commissioner, Public Building Service, General Services Administration, to take a leasehold estate in or the right to use and occupy the property described therein for public use, namely, office space and related purposes, for 'a term of years commencing July 1, 1961, and ending June 30, 1963, with the Government having the right to terminate at any time on or after June 30, 1962, upon 60 days prior written notice, together with the right in the United States to remove, within a reasonable time * * * any and all improvements and structures placed therein or thereon by and for the United States during its use and occupancy of the property under said initial term or any extended term or during the term of Lease No. GS-02B-474 and any extensions thereof * * *.'

It is further provided in the complaint that 'Said right to use and occupy the above described property is subject to the same interests, rights, and conditions as incorporated in Lease No. GS-02B-474 (and supplemental agreements and renewals).'

 The Declaration of Taking filed the same day contains a similar description of the estate taken, and a recital that the amount of $ 175,344.75 would be 'just compensation for the period commencing July 1, 1961 and ending June 30, 1962'. Pursuant thereto, a deposit of said sum was made into the Registry of this Court. An order for possession issued the following day, September 27, 1961.

 Defendants in their answer object to the action and taking on the following grounds: (a) there is no authority for the condemnation of the interest sought to be condemned; (b) a taking 'subject to the conditions' in prior leases between the parties subjects the defendants to in personam obligations; (c) the action, commenced September 26, 1961, seeks to condemn the property retroactively as of July 1, 1961 and is therefore improper; and (d) the deposit pursuant to the Declaration of Taking does not reflect a good faith estimate of just compensation, is arbitrary and hence violative of law.

 On this state of the record the Government moves to strike the answer on the ground that it fails to allege facts sufficient to constitute a defense. Defendants reply by moving to dismiss the complaint and vacate the Declaration of Taking. In the alternative, defendants seek to withdraw the funds deposited pursuant to the Declaration of Taking in the event that the primary relief prayed for is denied. These motions, taken together, question the respective pleadings by raising issues which the Court will consider seriatim.

 I. Estate to be Taken

 A. In personam obligations

 Defendants contend that the complaint and Declaration of Taking are invalid because on their face they seek to condemn certain terms and obligations which impose in personam obligations on the landlord. Section 258a of Title 40 United States Code Annotated, requires that the Declaration of Taking shall contain a description of the lands to be taken sufficient for identification as well as the estate or interest in the lands to be taken. Rule 71A of the Rules of Civil Procedure provides that the complaint shall contain a description of the property sufficient for identification and also the interest to be acquired. The prior lease granted or reserved to the landlord certain rights in the leased premises. Accordingly, some reference to the prior lease was necessary to describe and circumscribe the precise nature of the use and occupancy taken. Moreover, the lessee had certain rights of removal under the old lease and in tacking on its new use and occupancy, it was natural that some reference be made thereto. The Government has denied, on the record, that under the clause referring to the prior lease, it seeks to impose any duties or obligations upon the defendants. On the contrary, it states that it now seeks to take no more of an interest in the premises than it previously possessed under the prior lease without, however, any personal obligations. It is agreed by both parties that no in personam obligations can be imposed upon the landlord. It is true that the description contained in the Declaration of Taking and the complaint for purposes of identification and taking was not the most artistic or accurate. Nevertheless, a reasonable meaning which will support a pleading should, if possible, be adopted rather than one which will defeat the pleading. Reconstruction Finance Corporation v. J. G. Menihan Corporation, D.C.N.Y.1938, 22 F.Supp. 180; Sewerage Commission of City of Milwaukee v. Activated Sludge, Inc., 7 Cir., 1934, 69 F.2d 594. Viewing the complaint and Declaration of Taking realistically, the Court concludes that they seek only to condemn the use and occupancy of the premises.

 It is possible that the landlord may subsequently agree to furnish the Government the same services theretofore rendered under the prior lease, but no such agreement on the part of the landlord can be compulsory. Its existence, or lack of existence, will affect the amount of any award hereafter made.

 B. Removals

 Objection is made to the attempt by the Government to obtain the right to remove 'any and all improvements and structures' placed on the premises during its use and occupancy. Defendants claim that the Government is condemning at present a portion of the real estate which may or may not spring into existence in the future. With respect to past improvements, the Government has a right of removal under the prior leases. With respect to future improvements, there is no property which the defendants now own which is being condemned. The matter is highly speculative because there may not be any 'improvements' in the future. Moreover, only improvements that become fixed to the real estate will create any rights in the defendants, and the value of those rights, if any, can be ascertained at a valuation hearing held for the purpose. If after removing any improvements the premises are not returned to the defendants in the same condition as received by the Government, then the latter would be obliged to respond in damages for any injury to the real estate. These questions seem to be the ones which naturally flow from use and occupancy of premises.

 C. Indefiniteness

 The next objection to the nature of the estate taken is that the Government seeks to condemn use and occupancy for a two-year yerm, with a right to terminate on 60 days' written notice on or after the expiration of the first year's term. Defendants contend that the estate to be condemned is therefore too vague to be defined. Condemnation of leasehold interests in property with the right of renewal, has been judicially approved. United States v. 396 Corp., 2 Cir., 1959, 264 F.2d 704, cert. den., 361 U.S. 817, 80 S. Ct. 60, 4 L. Ed. 2d 64. In effect, the arguments advanced by defendants raise the issue of whether or not such an interest is too difficult to evaluate, not the validity of the taking. *fn1" Adverting to the question of evaluation, it is not disputed that an option to renew may be valued and appraised. United States v. Petty Motor Co., 1946, 327 U.S. 372, 380-381, 66 S. Ct. 596, 90 L. Ed. 729. While it is true that an evaluation in advance of the commencement of the option period entails a certain amount of speculation, that does not per se invalidate the proceeding. At the time that the value of the interest is fixed some equitable method of determining ...

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