Carolina Power and Light Company v. Clark

91 S.E.2d 569 (1956)

243 N.C. 577

CAROLINA POWER AND LIGHT COMPANY, Petitioner, v. Jesse C. CLARK, Jr., Hattle M. Clark and Buncombe County, North Carolina, Defendants.

No. 91.

Supreme Court of North Carolina.

February 29, 1956.

*570 Charles F. Rouse, Raleigh, Robert F. Phillips and Harkins, Van Winkle, Walton & Buck, Asheville, for petitioner, appellant.

W. W. Candler and Cecil C. Jackson, Asheville, for defendant respondents, appellees, Jesse C. Clark, Jr., and Hattie M. Clark.

PARKER, Justice.

The evidence of the individual defendants introduced without objection, except as to the testimony of Sam W. Huddleston set forth below, which was objected to on the ground that he had not qualified as an hydraulic engineer to express an opinion, tends to show the following facts. They own a farm of about 100 acres in Beaverdam Valley. Beaverdam Creek, a clear mountain stream about 14 to 16 feet wide and 10 to 18 inches deep, runs approximately through the center of the farm. On the north end of the farm is a narrow gorge 100 to 150 feet wide, where a dam could be placed to create a lake and to make a development for residential lots. Before petitioner's power lines were placed on the easement, they had plans for the construction of a dam. A dam was needed to pond water for irrigation on the farm. Just before the power line was built, they had secured tractors and equipment to build a dam. The petitioner placed five poles on the easement on the farm to carry its lines. Their witness, Sam W. Huddleston, testified that a dam about 120 feet wide at the bottom and about 12 to 14 feet wide at the top could be built in the narrow gorge on the farm. The poles of the petitioner would damage the proposed lake, because the water of the lake would have to be maintained at a level not to interfere with the power lines.

In reply to the above evidence petitioner offered the testimony of Lee G. Warren, who has had experience in the building of hydroelectric developments for 22½ years. At the request of the petitioner he went out to the farm of the appellants, and made a survey or calculation as to the building of a dam wholly on their farm. He testified as to the things to be considered in order to calculate and build a dam there. He was then asked this question by petitioner: "Do you have an opinion, from your inspection of this site which you speak of, the approximate cost of the construction of a dam there?" The appellants objected, the objection was sustained, and the petitioner excepted, which is its exception No. 5 and assignment of error No. 5. The witness, if permitted to answer, would have replied: "Yes, 20 feet high it would cost $50,000.00; that is a rolled clay dam, with rock riprap sides, surfaces, and for 10 feet high it would cost approximately $20,000." The jury did not hear this excluded testimony. The petitioner assigns the exclusion of this evidence as error.

In fixing values on property in condemnation proceedings for any and all uses or purposes to which the property is reasonably adapted and might, with reasonable probability, be applied, but has never been applied, its availability for future uses must be such as enters into and affects its market value, and regard must be had to the existing business or wants of the community, *571 or such as may be reasonably expected in the immediate future to affect present market value. The test is what is the fair value of the property in the market. The uses to be considered must be so reasonably probable as to have an effect on the present market value. Purely imaginative or speculative value should not be considered. Gallimore v. State Highway and Public Works Commission, 241 N.C. 350, 85 S.E.2d 392; Nantahala Power & Light Co. v. Moss, 220 N.C. 200, 17 S.E.2d 10; Carolina-Tennessee Power Co. v. Hiawassee River Power Co., 186 N.C. 179, 119 S.E. 213; Teeter v. Postal Telegraph-Cable Co., 172 N.C. 783, 90 S.E. 941; Wadsworth Land Co. v. Piedmont Traction Co., 162 N.C. 503, 78 S.E. 299; Brown v. W. T. Weaver Power Co., 140 N.C. 333, 52 S.E. 954, 3 L.R.A., N.S., 912; Olson v. United States, 290 U.S. 623, 54 S. Ct. 229, 78 L. Ed. 543; Boom Co. v. Patterson, 98 U.S. 403, 25 L. Ed. 206; Illinois Power & Light Corporation v. Parks, 322 Ill. 313, 153 N.E. 483; Pruner v. State Highway Com'r, 173 Va. 307, 4 S.E.2d 393; State Highway Commission v. Brown, 176 Miss. 23, 168 So. 277; Andrews v. Cox, 127 Conn. 455, 17 A.2d 507.

Crisp v. Nantahala Power & Light Co., 201 N.C. 46, 158 S.E. 845, 846, was an action to recover damages for the construction of an electric transmission line over the plaintiff's land. The Court said: "The defendant contends that several witnesses were allowed to give their opinion as to the purpose for which the lands are adapted or suitable and to give an opinion of its decreased value. We see no objection to the competency of this character of evidence." See also to same effect Nantahala Power & Light Co. v. Rogers, 207 N.C. 751, 178 S.E. 575; Teeter v. Postal Telegraph-Cable Co., supra.

The individual defendants offered testimony to show that their land was plainly adapted for a dam site, and that the easement acquired by petitioner in impairing or destroying its availability for a dam site decreased the present value of their land. The excluded testimony of petitioner's witness, Lee G. Warren, as to the high cost of constructing a dam upon their property, was competent as tending to show that, because of the high cost of building a dam upon this land, the availability of this property for a dam site would not enter into the contemplation of a prospective seller or purchaser of the property, and could not reasonably be held to affect or enhance its present market value. The exclusion of this testimony was prejudicial error to petitioner. Such error is apparent from a reading of the charge where it appears that the judge recapitulated the evidence of the individual defendants as to the availability of their land for a dam site to create a lake for purposes of irrigation and for selling building lots around it, and petitioner's evidence as to the high cost of constructing a dam upon this property was excluded from the knowledge and consideration of the jury.

The petitioner assigns as error No. 8 this part of the charge: "Where * * * a public utility takes by condemnation a perpetual easement entitling it to occupy and use the entire surface of a part of a tract of land * * *."

The petitioner assigns as error No. 9 this part of the charge: "The rule declares that the full market value of the part of the land covered by perpetual easement will be a proper element of the compensation, and forbids any diminution in the allowable compensation on account of any use which the landowner might make of any part of the land covered by the perpetual easement."

The petitioner assigns as error No. 10 this part of the charge: "Since the condemnor acquires the complete right to occupy and use all the land covered by the perpetual easement for all time to the exclusion of the landowners, the bare fee remaining in the landowner is, for all practical purposes, of no value, and the value of the perpetual easement acquired by the condemnor is virtually the same as the value of the land embraced by it."

At the beginning of the trial the parties to this special proceeding entered into a stipulation to this effect: The petitioner *572 is a public utilities corporation existing under, and by virtue of, the laws of North Carolina, and is doing business within said State in the distribution of electricity for commercial, industrial and domestic use. That it has the power of eminent domain for the purposes of its business. That the petitioner, under its power of eminent domain, has taken an easement and right of way over the land of the individual defendants, which easement is specifically described in the stipulation, with the privilege to construct, operate and maintain in, upon, and through said land, in a proper manner, with poles, wires and other necessary apparatus and appliances, a line for the purpose of transmitting electricity, with the right at all times to enter upon said land to inspect said line, and to make necessary repairs and alterations, with the right to permit the attachment of, and to carry in conduit wires and cables of any other company or person, together with the right to keep the right of way clear of all structures, except ordinary fences, trees, etc. "That, except for said purposes, the petitioner does not propose to interfere with the rights of the defendants; that the defendants shall have the full power and right to use the lands over which said right of way and easement shall be condemned for all purposes not inconsistent with the rights to be acquired therein and the use thereof by the petitioner * * *. It is further stipulated and agreed that the land described in the preceding paragraphs is acquired by the petitioner for the purpose of conducting the business for which it is engaged, and the specific use of said land, right of way and easement for the purpose of laying out, constructing, maintaining, operating and preparing, altering, replacing and removing power lines and communication lines in connection with the business of said petitioner."

This Court said in North Carolina State Highway v. Black, 239 N.C. 198, 79 S.E.2d 778, 782: "Whether there is any substantial difference beween an easement and a fee-simple estate in land depends upon the nature and extent of the easement."

The nature and extent of the easement acquired controls the rights of the parties. Each case must stand on its exact facts. Chesson v. Jordan, 224 N.C. 289, 29 S.E.2d 906.

In Carolina Power & Light Co. v. Bowman, 229 N.C. 682, 51 S.E.2d 191, 195, 6 A.L.R.2d 194, the Court said: "The general rule in regard to land condemned for use for electric power transmission lines seems to be that the landowner has the right to make use of the strip of land condemned in any manner which does not conflict with the rights of the Power Company, and which is not inconsistent with the use of the land for the purposes for which condemnation was allowed, and which does not interfere with the free exercise of the easement acquired."

According to the stipulation entered into by the parties here except the defendant Buncombe County, which did not answer, the easement acquired by petitioner in the instant case expressly states, "that the defendants shall have the full power and right to use the lands over which said right of way and easement shall be condemned for all purposes not inconsistent with the rights to be acquired therein and the use thereof by the petitioner." This is a substantial right for the appellants. According to the stipulated easement here, the landowners have this further substantial right, that, if any additional burden is put upon this right of way or easement not properly embraced in the general purposes for which condemnation was had, the compensation for such additional burden will accrue to the owner and not to the petitioner. Phillips v. Postal Tel. Cable Co., 130 N.C. 513, 41 S.E. 1022; Hodges v. Western Union Postal Tel. Co., 133 N.C. 225, 45 S.E. 572; Brown v. W. T. Weaver Power Co., supra; Teeter v. Postal Telegraph-Cable Co., supra; Rouse v. City of Kinston, 188 N.C. 1, 123 S.E. 482, 35 A.L.R. 1203; Crisp v. Nantahala Power & Light Co., supra; Hildebrand v. Southern Bell Telephone & Telegraph Co., 219 N.C. 402, 14 S.E.2d 252. The stipulation as to the easement in the instant case seems to have been entered into by the parties so as *573 to conform to the general rule set forth in the paragraph immediately above in Carolina Power & Light Co. v. Bowman.

The lower court in its charge, and particularly in the part of it which is covered by petitioner's assignments of error Nos. 8, 9 and 10, ignored the nature and extent of the easement acquired by petitioner here according to the express stipulation, and charged the law, as if petitioner had acquired the complete right to occupy and use the entire surface of the part of the land covered by a perpetual easement for all time to the exclusion of the individual defendants. In so charging, the court was in error, and assignments of error Nos. 8, 9 and 10 are good. Of course, if petitioner had acquired such an easement as the lower court charged, which it did not, "the bare fee remaining in the landowner is, for all practical purposes, of no value, and the value of the perpetual easement acquired by the condemnor is virtually the same as the value of the land embraced by it." North Carolina State Highway v. Black, supra.

The petitioner assigns as error No. 13 the failure of the court to charge the jury as to the use that the appellants could make of the easement acquired as stipulated. This assignment of error is good.

This Court said in Nantahala Power & Light Co. v. Carringer, 220 N.C. 57, 16 S.E.2d 453, 454: "When an easement is acquired in land the fee remains in the original owner burdened by the uses for which the easement is acquired. Hence, in awarding compensation to the owner of land for an easement acquired due consideration is to be given to the fact that the fee remains in the owner subject to the prior rights incident to the easement."

Carolina Central Gas Co. v. Hyder, 241 N.C. 639, 86 S.E.2d 458, 460, is distinguishable. In that case the Court said: "In the instant case, the nature of the easement is stipulated and does not purport to limit the petitioner's use to the exercise only of such rights as may be reasonably necessary to carry out the purposes for which the easement is sought."

For prejudicial error in the exclusion of evidence and for prejudicial errors in the charge, petitioner is entitled to a

New trial.