United States v. Toronto Hamilton & Buffalo Navigation Company/Concurrence Frankfurter

Mr. Justice FRANKFURTER, concurring.

Even though I join the Court's opinion in its general direction, the treacherous nature of the subject matter makes appropriate a separate statement of views.

Resort to the conventional formulas for ascertaining just compensation for the taking of property rarely bought and sold, and having therefore no recognized market value, does not yield fruitful results. The variables are too many to permit of anything except an informed judgment. Everything, therefore, turns on the process of judgment to the end that judgment be not based on standards too difficult of application or evidence too tenuous for solid inference.

It is this Court's duty to lay down standards for application by the lower courts. But since we are concerned with ascertainment of rather elusive values, those whose primary duty it is to make these estimates ought not to be cramped by rules that are too rigid and too artificial. If the questions presented to this Court in a particular case really turn, as they do here, on the relevance of data and the reasonableness of the inferences drawn from them in arriving at just compensation, the training and experience of the fact-finders become important.

If a jury is to make the valuation the area within which speculation may in the nature of things roam at large should be as narrowly confined as possible. See Kimball Laundry Co. v. United States, 338 U.S. 1, 20, 69 S.Ct. 1434, 1445. But when the valuer is a court and particularly the tribunal that consists of judges to whom may fairly be attributed the expertness that comes from frequent dealing with the more elusive problems of value, it seems desirable for this Court to allow such tribunal considerable freedom from hard and fast rules in determining what data are relevant and what significance may be drawn from them. Barring obviously wrong criteria, or findings baseless in proof, experience counsels empiricism in dealing with these problems. And empiricism suggests sailing as close to the record of a particular case as possible. Only thus shall we avoid abstract pronouncements bound to distort or to be distorted by the case-by-case adjudicatory process especially appropriate in problems of this nature. Either lip-service will be paid such formulas while decisions are rooted in considerations outside them, or formulas not fitting practical circumstances will achieve impractical results.

In the light of this general approach the cae before the Court comes down to this:

1. The starting point of the computation by the Court of Claims of the amount to be awarded for the Government's taking of the Maitland was capitalization of its earnings between 1916 and 1932. While we do not have the evidence that was before the court below, its findings disclose no reasonable relation between such earnings and the value of the vessel in 1942, the year of the taking, whether for use on the Great Lakes or in Florida waters. To permit such data to serve as a springboard for judgment is to leave too much temptation for unbridled speculation even by experienced judges.

2. In these days of quick mobility both for persons and property it would be an unjustifiably artificial rule to confine the worth of mobile property, as was the Maitland, to place value. Of course if there was an active market for property to be condemned at about the time and place of the taking, evidence of demand for special uses, or at other places, would not be helpful in seeking the general value of the property as against some unusual salability of the property, unusual either by reason of location or as a matter of use. Such evidence of atypical demand should be excluded not because it has no logical relevance but because such practical significance as it has is already reflected in current market prices. But here it was found that there was in fact no market on the Great Lakes for vessels like the Maitland, and, since what the United States got had to be translated into dollars and cents, there is no reason in sense and therefore none in law for excluding from consideration that there was a demand for vessels such as the Maitland for use as a car ferry between Florida and Cuba.

3. But such evidence must be critically used. It is one thing to exclude such evidence of demand at a distant place to which the property was transferable and quite another to assume that a finding that in 1942 there was such a demand is proof positive that the Maitland would have found a market in Florida and to base valuation on such assumption. Particularly is this true when the court below found that it would have cost at least $115,000 to transport the Maitland to Florida waters and to outfit it for salt-water use. The amount of this expenditure is more than the arithmetic measure of the difference in value between a vessel located in Florida and one on the Great Lakes. The risk to a profitable venture that the $115,000 expenditure implies casts doubt on the likelihood of the Maitland's use in the Florida trade. For the greater the risk the smaller the impact of the opportunities of the distant market. The short of the matter is that for its difficult task of valuing the Court of Claims should not be confined either to acceptance or rejection of the Florida demand in toto. Like most problems in the law it is a matter of degree.

4. This Court should not go beyond indicating the broad lines for adjudication by the Court of Claims, leaving to that court discretion appropriate to its experience in applying the indicated standards to the facts before it. The analysis we have outlined must be fitted to facts not now before us. I am not prepared therefore to specify as a matter of law what number of logically relevant sales do or do not meet the claimant's burden. After the Court of Claims has made additional findings in the light of this Court's decision it will be time enough to consider whether the data before it are too tenuous to permit solid inferences from them, as set forth in appropriate findings, regarding the weight which the Court of Claims may accord to the Florida demand.