Opinion
For Opinion on Hearing, see 98 Cal.Rptr. 454, 490 P.2d 1142.
Opinion on pages 164 to 172 omitted
HEARING GRANTED
See 6 Cal.3d 141.
Phill Silver and Robert M. Silver, Hollywood, for defendants-appellants.
John D. Maharg, County Counsel, and Charles Vinson Tackett, Deputy County Counsel, for plaintiff-respondent.
ALLPORT, Associate Justice.
The sole issue presented on this consolidated appeal is whether, in a proceeding in eminent domain. a defendant is entitled to be awarded, as part of the costs of suit, expenses which he has incurred for expert witnesses. Each of the defendants, in separate actions, filed a memorandum of costs and disbursements in the trial court which included expert witness fees and expert appraisal report fees. Plaintiff's motions to retax these costs were consolidated, the motions were granted and the defendants have appealed from that order.
The precise issue presented on this appeal was considered in City of Los Angeles v. Vickers, 81 Cal.App. 737, 254 P. 687. There the appellate court concluded that the constitutional requirement of 'just compensation' did not require that a defendant in a condemnation action be reimbursed by the plaintiff for fees paid to expert witnesses. The reported decision in Vickers does not indicate that a hearing in the Supreme Court was requested. Defendants contend that Vickers is 'wrong in principle and should not be followed.' For reasons which will be set forth hereinafter, we agree with defendants and hold that section 14 of article I of the California Constitution, which provides that private property shall not be taken or damaged for public use without just compensation, requires that defendants in actions in eminent domain, under appropriate circumstances, recover as costs reasonable [94 Cal.Rptr. 551] amounts for fees paid to expert witnesses.
In City of Los Angeles v. Moyer, 108 Cal.App. 4, 290 P. 1073, there was not strict adherence to the rule set forth in Vickers. The defendant in Moyer was allowed $5 and $25 as expert witness fees but appealed because these sums were less than the amounts which he had requested in his cost bill. The appellate court stated that the evidence was sufficient to sustain the implied findings of the trial court and, therefore, affirmed the order. The propriety of awarding expert witness fees as costs was not, however, explicitly considered.
In Vickers, 81 Cal.App. 737, at page 739, 254 P. 687, at 687-688, the court stated: 'In a condemnation case which came before our own courts a defendant included in his cost bill items of the counsel fees paid by him in conducting his defense. On a motion to tax the trial court struck out the items in question, and on appeal the very ground was taken which is urged by respondent here. The court, according to the syllabus in the report, which is a fair statement of the effect of a portion of the opinion, decided: 'The 'just compensation' to which the owner of property is entitled under section 14 of article I of the Constitution, in proceedings in eminent domain, does not include reasonable disbursements made by him for attorneys at the trial; it has reference to the value of the property taken and the damage to property not taken, and nothing more.' * * * (Pacific Gas & E. Co. v. Chubb, 24 Cal.App. 265, 141 P. 36). This case appears to exactly in point upon the question which respondent makes as to his rights under the Constitution. It is true that the decision relates to attorney's fees as costs, but expenditures made to lawyers for the defense of a condemnation suit and fees paid to experts for their testimony stand in the same category in so far at it may be contended that payment of the latter reduces, in effect, the amount to be paid to a defendant under decree of condemnation. We think the point made under the Constitution is without merit.'
In order to expose the basic infirmity of Vickers it is necessary to consider the reasoning of the court in Pacific Gas Etc. Co. v. Chubb, supra, 24 Cal.App. 265, 141 P. 36, which was relied on in Vickers. The court in Chubb initiated its reasoning by reference to section 1249 of the Code of Civil Procedure which provided that the measure of compensation for property taken or damaged is the actual value at the date of the issuance of summons and, concluded correctly therefrom, that the jury which ascertained the compensation to which the property owner was entitled could not consider attorneys' fees as an element of property value. The court then reasoned as follows (at page 267, 141 P. at page 36): 'If the measure of compensation is to be the actual value of the land at the date the summons issues or at the date of the trial, and if this compensation is to be ascertained by a jury or a court sitting as a jury, and if the jury or court cannot take in to account attorney's fees as an element of damage, it would seem to follow that the 'just compensation' contemplated by the Constitution is the value of the land taken, and the damage to land not taken and nothing more.'
The asumption by the court in Chubb that section 1249 of the Code of Civil Procedure was as protective of a property owner's right to just compensation as is required by section 14 of article I of the Constitution was clearly erroneous. In San Francisco v. Collins, 98 Cal. 259, 33 P. 56, which was decided some 21 years before Chubb, the Supreme Court considered the propriety of requiring the defendant tin a propriety of requiring the defendant in a condemnation action to pay sheriff's fees, clerk's fees, notary's fees, fees for serving subpoenas, one-half of the jury and reporter's fees, and 'fees of twelve witnesses for defendants, $30.' Section 1255 of the Code of Civil Procedure provides for the allowance of costs in eminent domain proceedings as follows: 'Costs may be allowed or not, and if allowed, may be apportioned between the parties on the same or adverse sides, in the discretion of the court.' In Collins the defendants argued that the plaintiff should have been required to pay its own costs and all proper costs of the defendants. The reason for this contention was the same as that advanced in the instant case: '[T]o subject the defendants to payment of any portion of the costs is an infringement of their constitutional right to full and just compensation for the costs is and infringement of their constitutional right to full and just compensation for the taking and damaging [94 Cal.Rptr. 552] of their lands.' In response to this argument it was stated in Collins (page 262, 33 P. page 57): 'As a general proposition, applied to proper costs incurred in good faith, I think this point should be sustained.'
The Supreme Court in Collins, after quoting section 1255 of the Code of Civil Procedure and noting plaintiff's claim 'that the order of the court below, allowing and apportioning the costs, was a proper exercise of the discretionary power conferred by this section,' stated at page 262, 33 P. at page 57, as follows: 'But this power must be limited by section 14, art. I, of the constitution, which provides that 'private property shall not be taken or damaged for public use without just compensation having been fist made to or paid into court for the owner.' In proceedings to condemn, the burden of proving the compensation to which they are entitled is cast upon the defendants, who are also entitled to contest the material allegations of the complaint. To require the defendants in this case to pay any portion of their costs necessarily incidental to the trial of the issues on their part, or any part of the costs of the plaintiff, would reduce the just compensation awarded by the jury, by a sum equal to that paid by the jury, by a sum equal to that paid by them for such costs.' (See Heimann v. City of Los Angeles, 30 Cal.2d 746, 753, 185 O.2d 597, overruled on other grounds.) It is manifest from the language just quoted that the 'just compensation' to which a property owner is entitled is not limited to the amount which the jury or court ascertains to be the proper date of valuation, by encompasses reasonable amounts for necessary costs. The allowance of such costs is constitutionally required and the only discretion which is vested in the trial court by section 1255 of the Code of Civil Procedure is with respect to the determination of what are proper and reasonable costs. As stated in Collins (98 Cal. page 263, 33 P. page 57): 'No doubt the court has power to determine what are proper and what are improper items of cost in proceedings of this kind, and to disallow such as are improper, as in other cases. For example, unnecessary expenditures, made in bad faith, for the purpose of increasing the costs or obstructing the proceeding, are not properly taxable as costs, and may be disallowed; and cases may possibly arise in which a portion of the expense of the party seeking to condemn may be properly charged and apportioned to the landowner, on the ground that such expense was caused and incurred only by reason of unnecessary obstructive proceedings of the latter, interposed in bad faith; * * *.'
Clearly, the court in Chubb misread the import of Collins when it distinguished that case by saying (24 Cal.App. at page 269, 141 P. at page 37): 'The question here [recovery of attorneys' fees] was not presented, nor is the decision [in Collins] authority for holding that in such cases any costs are allowable except as authorized by statute.'
If the constitutional basis for the result in Collins was that to deny the defendants their costs 'would reduce the just compensation awarded by the jury, by a sum equal to that paid by them for such costs,' how, then, can a valid distinction be drawn based upon the nature of the necessary expenditure which would justify the recovery of certain costs but not of others?
In Vickers, 81 Cal.App. 737, 254 P. 687, the court considered, but rejected, the argument that 'costs' as that word is used in section 1255 of the Code of Civil Procedure embraces expert witness fees. In rejecting that argument the court compared the language of section 1255 with that of former section 1025 of the Code of Civil Procedure which contained a general provision for costs. The court stated at pages 740-741, 254 P. at page 688 as follows: 'Section 1022 of the Code of Civil Procedure provides that 'costs are allowed of [94 Cal.Rptr. 553] course, to the plaintiff, upon a judgment in his favor.' in certain specified actions, among which are not included those commenced for the purpose of condemning real property under the exercise of the right of eminent domain. It is provided in section 1025 of the same Code that in actions other than those mentioned in section 1022 'costs may be allowed or not, * * * in the discretion of the court. * * *' These two sections are found in a chapter of the Code entitled 'Costs.' Section 1255 of the same Code, contained in a 'title' is headed Eminent Domain,' so far as its language is material here, is identical with section 1025. * * * It has bee determined in Bathgate v. Irvine, 126 Cal. 135, 58 P. 442, 77 Am.St.Rep. 158, that in an action to quiet title fees paid to experts may not be allowed as costs. The taxation of costs in such actions is regulated by the provisions of section 1025 of the Code of Civil Procedure; but section, 1255, relating to condemnation proceedings, is cast in the same language as section 1025. It would seem, therefore, that, as the fees of experts are not allowable under the latter section they cannot be allowable under section 1255.'
The fatal unsoundness of this reasoning lies in the failure of the court sto recognize and give proper weight to the constitutional dimension pertaining to the recovery of costs in condemnation proceedings which was recognized in Collins. Such constitutional considerations are not applicable to the recovery of costs in other actions. This basic distinction was recognized in Silver Lake etc. Irr. Co. v. Los Angeles, 32 Cal.App. 123, at page 126, 162 P. 432, at pages 433-434, wherein it was stated: 'In the case of City [and County] of San Francisco v. Collins, 98 Cal. 259, 33 P. 56, our Supreme Court has pointed out that, as section 14 of article I of the Constitution provides that private property shall not be taken or damaged for public use without just compensation having first been made, the general statute relating to costs to be allowed to a plaintiff in an action cannot be made to apply in condemnation cases. In this decision it is quite clearly intimated that, by reason of the constitutional guaranty, suits in eminent domain are properly subject to different treatment in the matter of the rights of the parties to costs than are civil suits in general.'
The view that a constitutional provision for the payment of 'just compensation' for private property taken for public use requires that a defendant be allowed to recover as part of his costs reasonable fees paid to expert witnesses has been adopted in Louisiana (State Through Department of Highways v. Babineaux, La.App., 189 So.2d 450) and Florida (Dade County v. Brigham, 47 So.2d 602).
In Dade County v. Brigham, supra, 47 So.2d 602, at pages 604-605 the Supreme Court of Florida stated: 'Section 73.16, Florida Statutes 1941, FSA, which provides 'All costs of proceedings shall be paid by the petitioner, including a reasonable attorney's fee * * *' should be construed in the light of Section 12 of our Declaration of Rights, FSA, which declares that private property shall not be taken 'without just compensation.' (Italics supplied.) When so construed the language 'All costs of proceedings * * *' must be held, in a proper case, to include fees of expert witnesses for the defendants. The allowance or disallowance of such fees should be a matter for the trial judge to decide in the exercise of sound judicial discretion. [p] Since the owner of private property sought to be condemned is forced into court by one to whom he owes no obligation, it cannot be said that he has received 'just compensation' for his property if he is compelled to pay out of his own pocket the expenses of establishing the fair value of the property, which expenses in some cases could conceivably exceed such value.'
In People ex rel. Dept. of Pub. Works v. Lynbar, 253 Cal.App.2d 870, at pages 879-880, 62 Cal.Rptr. 320, at pages 327-328, we find the following: 'We base this conclusion [94 Cal.Rptr. 554] on the fundamental nature of the constitutional requirement of just compensation. All of condemnation law (statutory and decisional), procedure and practice is but a means to this end of just compensation. The power of eminent domain is granted to the executive branch of the state government so that private property may be taken expeditiously for public use whenever it is so needed, but only upon payment of just compensation to the property owner. The right to take private property involuntarily for public use is conditional and bottomed upon the performance by public authorities of this obligation to pay to the owner of private property the just compensation due him. This obligation of the state to make just compensation to the property owner for the property taken has long been recognized in this state as concomitant with and inseparable from its right of eminent domain. (See San Francisco, A. & S. R. R. Co. v. Caldwell, 31 Cal. 367, 372.) [p] Just compensation under the fifth Amendment to the United States Constitution, so far as taking damages are concerned, means the full and perfect equivalent in money of the property taken. The owner is to be put in as good a position pecuniarily as he would have occupied if his property had not been taken from him. (United States v. Miller, 317 U.S. 369, 373, 63 S.Ct. 276, 87 L.Ed.2d [sic] 336, 342, 147 A.L.R. 55.) We believe that the due process clause of the fourteenth Amendment to the United States Constitution requires this as well. (Cf. Marin Municipal Water Dist. v. Marin Water etc. Co., 178 Cal. 308, 314, 173 P. 469.) [p] In our opinion this is likewise the mandate of article I, section 14 of our State Constitution. The property owner must be made whole for his loss and be recompensed in an amount of money equal to that loss. (City of Los Angeles v. Harper, 139 Cal.App. 331, 334, 33 P.2d 1029.) In short, just compensation is based on the loss the owner suffers rather than the benefit which the taker receives. (People v. La Macchia, 41 Cal.2d 738, 754, 264 P.2d 15 overrule on another point. County of Los Angeles v. Faus, 48 Cal.2d 672, 679, 312 P.2d 680.)'
There being no sound basis for drawing a constitutional distinction between fees for jurors, for example, and fees for expert witnesses, a defendant in a condemnation action under certain circumstances is entitled to recover as costs reasonable expenses which he incurs in order to obtain the services of expert witnesses; otherwise, the 'just compensation' awarded by the jury or the court would be in effect reduced by a sum equal to that paid by a defendant for such costs.
While the issue is not presented in the instant case, the clear implication of the reasoning of this opinion is that reasonable attorneys' fees are also recoverable as costs by a defendant in a condemnation action.
Cal.Const., art. I, see. 14 has been held to be self-executing. No creation of a remedy by legislative enactment is required. (Bacich v. Board of Control, 23 Cal.2d 343. 346, 144 P.2d 818; Rose v. State of California, 19 Cal.2d 713, 719, 123 P.2d 505.)
We do not hold, however, that in all cases of eminent domain the fees of expert witnesses are recoverable as a matter of right. The recovery is to be governed by the facts of the particular case and involves a twofold determination by the trial court. The first determination to be made is whether such fees must be included in the award in order to insure the 'just compensation' contemplated by the Constitution. In order to realize the market value of his holding, a property owner, compelled to litigate with the state as to the value, may well be required to incur substantial financial obligations for professional services calculated to realize his constitutionally guaranteed right. To require payment for such out of the award is not proper since the compensation contemplated by the Constitutions is thus reduced [94 Cal.Rptr. 555] by the amount of the expenses incurred. Hence it must be first determined whether or not the defendant was compelled to litigate. The answer to the query lies in the reasonableness of the prelitigation offer made by the condemnor judged in the light of the ultimate determination of the trier of fact as to the value. If the offer was substantially equivalent to the award, litigation was not compelled and it would not be reasonable to permit the recovery of these items of expense. On the other hand, if the offer was so disproportionately low that recourse to litigation and the incurring of this expense was compelled to achieve just compensation the opposite result should obtain. Upon a determination first being made that this item is reimbursable, then a second step, that of determining the proper amount to be allowed, must be considered. As can be seen it is not contemplated that a property owner offered a fair amount should be permitted to gamble for a higher award at the expense of the condemnor for such is not consistent with the definition of reasonableness. A determination of the propriety of this allowance includes consideration of not only the monetary amount sought, but of the compelling necessity for incurring the expense. The power to award such expert witness fees rests in the sound discretion of the trial court within the limitations set forth herein.
The order from which the appeal has been taken is reversed and each case is remanded to the trial court with directions to determine the reasonableness of the expert witness expenses as respectively set forth in the memoranda of costs and disbursements filed by the defendants and to order the plaintiff to pay such costs as the trial court determines to be reasonable under the governing law as set forth in the opinion herein.
SCHWEITZER, Acting P. J., and COBEY, J., concur.