A-43439, AUGUST 15, 1932, 12 COMP. GEN. 238

A-43439: Aug 15, 1932

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INTEREST WILL BE ALLOWED AT THE RATE OF 4 PERCENT PER ANNUM ON THE EXCESS OF THE AMOUNT AWARDED OVER THE AMOUNT ESTIMATED AS JUST COMPENSATION AND PAID INTO THE REGISTRY OF THE COURT AT THE FILING OF THE DECLARATION OF TAKING. INTEREST WILL NOT BE ALLOWED ON THE AMOUNT ESTIMATED AS JUST COMPENSATION AND PAID INTO THE REGISTRY OF THE COURT AT THE FILING OF THE DECLARATION OF TAKING. 1932: REFERENCE IS MADE TO LETTERS OF JULY 13 AND 26. THERE APPEARS TO HAVE BEEN RAISED IN YOUR DEPARTMENT A QUESTION AS TO THE COMPUTATION OF INTEREST PAYMENTS IN CONNECTION THEREWITH. IN THE CASE REFERRED TO A DECLARATION OF TAKING WAS FILED JANUARY 14. 500 WAS ESTIMATED AS JUST COMPENSATION FOR THE PARCEL HERE INVOLVED DESCRIBED AS PARCEL II AND SAID AMOUNT WAS PAID INTO THE REGISTRY OF THE COURT COINCIDENT WITH THE FILING OF THE DECLARATION OF TAKING.

A-43439, AUGUST 15, 1932, 12 COMP. GEN. 238

ECONOMY ACT - INTEREST ON JUDGMENTS - SITES FOR PUBLIC BUILDINGS IN THE PAYMENT OF JUDGMENTS ENTERED IN CONDEMNATION CASES, INTEREST WILL BE ALLOWED AT THE RATE OF 4 PERCENT PER ANNUM ON THE EXCESS OF THE AMOUNT AWARDED OVER THE AMOUNT ESTIMATED AS JUST COMPENSATION AND PAID INTO THE REGISTRY OF THE COURT AT THE FILING OF THE DECLARATION OF TAKING, FROM THE DATE OF SAID FILING TO THE DATE OF PAYMENT, IN ACCORDANCE WITH THE PROVISIONS OF THE ACTS OF MARCH 1, 1929, 45 STAT. 1415, AND FEBRUARY 26, 1931, 46 STAT. 1421, AS MODIFIED BY SECTION 319 OF THE ACT OF JUNE 30, 1932, 47 STAT. 412. INTEREST WILL NOT BE ALLOWED ON THE AMOUNT ESTIMATED AS JUST COMPENSATION AND PAID INTO THE REGISTRY OF THE COURT AT THE FILING OF THE DECLARATION OF TAKING.

COMPTROLLER GENERAL MCCARL TO THE ATTORNEY GENERAL, AUGUST 15, 1932:

REFERENCE IS MADE TO LETTERS OF JULY 13 AND 26, 1932 (SWR-33-24-20), RELATIVE TO THE ACQUISITION BY THE UNITED STATES OF CERTAIN PARCELS OF LAND DESIRED AS A SITE FOR A FEDERAL BUILDING AT MINNEAPOLIS, MINN. THERE APPEARS TO HAVE BEEN RAISED IN YOUR DEPARTMENT A QUESTION AS TO THE COMPUTATION OF INTEREST PAYMENTS IN CONNECTION THEREWITH.

IN THE CASE REFERRED TO A DECLARATION OF TAKING WAS FILED JANUARY 14, 1932, UNDER AUTHORITY OF THE ACT OF FEBRUARY 26, 1931, 46 STAT. 1421. SCHEDULE A OF THE DECLARATION OF TAKING, $10,500 WAS ESTIMATED AS JUST COMPENSATION FOR THE PARCEL HERE INVOLVED DESCRIBED AS PARCEL II AND SAID AMOUNT WAS PAID INTO THE REGISTRY OF THE COURT COINCIDENT WITH THE FILING OF THE DECLARATION OF TAKING.

THE AMOUNT ESTIMATED AS JUST COMPENSATION FOR SAID PARCEL II WAS THE AMOUNT WHICH HAD BEEN AWARDED BY THE COMMISSIONERS ON MAY 6, 1931. THE OWNER APPEALED FROM THE AWARD FOR SAID PARCEL II, BUT BEFORE THE HEARING AN AGREEMENT WAS REACHED BETWEEN THE OWNER AND THE GOVERNMENT THAT THE VALUE OF PARCEL II SHOULD BE $11,500 INSTEAD OF $10,500. ACCORDINGLY, JUDGMENT WAS ENTERED PROVIDING THAT UPON PAYMENT OF $11,500, TOGETHER WITH SUCH INTEREST ON THE SUM OF $10,500 ORIGINALLY AWARDED AS MAY BE ALLOWED BY LAW, TITLE TO PARCEL II WOULD VEST IN THE UNITED STATES.

ON JUNE 21, 1932, YOU WROTE THE SECRETARY OF THE TREASURY SETTING FORTH THE FACTS HEREINBEFORE RECITED CONCERNING PARCEL II AND STATED THAT WHEN THERE WAS PAID INTO THE COURT FOR USE OF THE PERSONS ENTITLED THERETO THE SUM OF $1,000 FOR PARCEL II AND THE DEPARTMENT OF JUSTICE WAS SO ADVISED, THE UNITED STATES ATTORNEY WOULD BE INSTRUCTED TO CAUSE TO BE ENTERED A FINAL JUDGMENT AND TO DELIVER TO THE SECRETARY OF THE TREASURY AN OPINION THAT TITLE TO SAID PARCEL HAD VESTED IN THE UNITED STATES. A SITE ACCOUNT WAS SUBMITTED TO THIS OFFICE BY THE TREASURY DEPARTMENT CALLING FOR PAYMENT OF $1,000 AS BALANCE OF JUDGMENT FOR PARCEL II.

IN THE SETTLEMENT ISSUED BY THIS OFFICE TO EFFECT FINAL PAYMENT OF THE CLAIM NO INTEREST WAS ALLOWED ON THE $10,500 WHICH PREVIOUSLY HAD BEEN DEPOSITED IN THE REGISTRY OF THE COURT, BUT INTEREST WAS ALLOWED AT THE RATE OF 4 PERCENT PER ANNUM ON THE $1,000 AWARDED IN ADDITION TO THE AMOUNT WHICH HAD BEEN ESTIMATED AS JUST COMPENSATION AND DEPOSITED AT THE TIME OF THE FILING OF THE DECLARATION OF TAKING.

THE ACTION IN NOT ALLOWING INTEREST ON THE AMOUNT DEPOSITED IN THE REGISTRY OF THE COURT WAS IN ACCORDANCE WITH THE PLAIN PROVISIONS OF THE ACT OF FEBRUARY 26, 1931, SUPRA, UNDER AUTHORITY OF WHICH THE DECLARATION OF TAKING WAS FILED, THAT "INTEREST SHALL NOT BE ALLOWED ON SO MUCH THEREOF AS SHALL HAVE BEEN PAID INTO THE COURT.' SAID ACT PROVIDES, HOWEVER, THAT ANY AMOUNT FINALLY AWARDED IN EXCESS OF THE ESTIMATED JUST COMPENSATION SHALL BEAR INTEREST AT THE RATE OF 6 PERCENTUMPER ANNUM FROM THE DATE OF THE VESTING OF TITLE UNDER THE DECLARATION OF TAKING, PRESUMABLY WITH THE OBJECT OF PUTTING THE PERSONS ENTITLED TO THE COMPENSATION AWARDED IN AS FAVORABLE A POSITION AS IF THE AMOUNT AWARDED HAD BEEN ORIGINALLY DEPOSITED.

THE INTEREST ALLOWED IN THE SETTLEMENT BY THIS OFFICE WAS COMPUTED AT THE RATE OF 4 PERCENT PER ANNUM INSTEAD OF AT 6 PERCENT AS PROVIDED IN THE ACT OF FEBRUARY 26, 1931, BECAUSE OF SECTION 319 OF THE ACT OF JUNE 30, 1932, PUBLIC NO. 212, 47 STAT. 412, WHICH PROVIDES:

HEREAFTER THE RATE OF INTEREST TO BE ALLOWED OR PAID SHALL BE 4 PERCENTUM PER ANNUM WHENEVER INTEREST IS ALLOWED BY LAW UPON ANY JUDGMENT OF WHATSOEVER CHARACTER AGAINST THE UNITED STATES AND/OR UPON ANY OVERPAYMENT IN RESPECT OF ANY INTERNAL-REVENUE TAX. ALL LAWS OR PARTS OF LAWS IN SO FAR AS INCONSISTENT HEREWITH ARE HEREBY REPEALED.

THE LIMITATION IN SECTION 319 OF THE ACT OF JUNE 30, 1932, SUPRA, ON THE RATE OF INTEREST "TO BE * * * PAID" THEREAFTER IS A LIMITATION ON THE USE OF APPROPRIATED MONEYS, AND PRECLUDES THIS OFFICE FROM CERTIFYING FOR PAYMENT UNDER ANY APPROPRIATION THERETOFORE OR THEREAFTER MADE INTEREST AT OTHER THAN 4 PERCENTUM PER ANNUM UPON ANY JUDGMENT OF WHATSOEVER CHARACTER AGAINST THE UNITED STATES.

WITH YOUR LETTER OF JULY 13, 1932, WAS INCLOSED FOR CONSIDERATION A MEMORANDUM PREPARED IN YOUR DEPARTMENT ON THE QUESTION RAISED. THE ARGUMENT SET FORTH IN THE MEMORANDUM SEEMS TO BE THAT THE FIXING OF JUST COMPENSATION FOR LAND TAKEN UNDER THE RIGHT OF EMINENT DOMAIN IS FOR THE COURTS RATHER THAN THE LEGISLATIVE BRANCH OF THE GOVERNMENT. WHILE THIS OFFICE DOES NOT DISAGREE WITH THAT VIEW ALTHOUGH IT MAY BE SAID INTEREST DUE IS NOT NECESSARILY A PART OF THE COMPENSATION, IT IS TO BE NOTED THAT THE ACT OF FEBRUARY 26, 1931, DOES NOT EVEN PURPORT TO TAKE AWAY FROM THE COURTS ANY OF THEIR FUNCTIONS OR POWERS IN THE MATTER OF FIXING JUST COMPENSATION FOR PROPERTY SO TAKEN BUT IT DOES PROVIDE A MEANS WHEREBY THE UNITED STATES MAY TAKE OVER THE PROPERTY AND THE OWNER BE PAID SUCH PART OF THE ESTIMATED JUST COMPENSATION AS THE COURT MAY DETERMINE WITHOUT WAITING FOR THE LONG DRAWN OUT COURSE OF THE ORDINARY CONDEMNATION PROCEEDINGS. THIS WOULD SEEM TO BE A MATTER ENTIRELY WITHIN THE POWER OF THE CONGRESS. UNDER SAID ACT THE CONGRESS HAS FIXED THE DATE AS OF WHICH THE UNITED STATES ACQUIRES TITLE AND THE OWNER ACQUIRES THE RIGHT TO JUST COMPENSATION, BUT THERE IS LEFT WITH THE COURT THE POWER TO DETERMINE THE AMOUNT OF THAT JUST COMPENSATION. THE PROVISION FOR INCLUDING INTEREST WAS, NO DOUBT, WRITTEN INTO THE ACT OF FEBRUARY 26, 1931, IN VIEW OF THE ESTABLISHED RULE THAT INTEREST IS NOT ORDINARILY PAID ON CLAIMS AGAINST THE UNITED STATES. I ASSUME IT WOULD NOT SERIOUSLY BE QUESTIONED THAT IF THE CONGRESS HAD THE POWER TO FIX THE RATE OF INTEREST IN THE ACT OF FEBRUARY 26, 1931, IT LIKEWISE HAD THE POWER TO REDUCE THAT RATE IN THE ACT OF JUNE 30, 1932.

THE AMOUNT PAID INTO THE REGISTRY OF THE COURT IS, OR IN A PROPER CASE MAY BE, IMMEDIATELY AVAILABLE TO THE PERSON OR PERSONS FOUND BY THE COURT TO BE ENTITLED THERETO, WHICH IS PRESUMED TO BE THE REASON FOR THE STATUTORY PROVISION THAT NO INTEREST SHALL BE ALLOWED ON THE AMOUNT PAID INTO THE REGISTRY OF THE COURT.

IF, IN THE INSTANT CASE OF PARCEL II, THE COURT DOES NOT CONSIDER THE PERSONS ENTITLED TO THE COMPENSATION AWARDED ARE ENTITLED TO THE INTEREST ALLOWED BY THE SETTLEMENT ON THE $1,000, THE CLERK WILL, NO DOUBT, BE SO INSTRUCTED BY THE COURT AND ANY EXCESS IN HIS HANDS WHEN THE WHOLE PROCEEDING IS CONCLUDED MAY BE REFUNDED TO THE UNITED STATES.

AFTER CAREFUL CONSIDERATION OF THE MATTERS SET FORTH IN THE MEMORANDUM FROM YOUR DEPARTMENT, I HAVE TO ADVISE THAT THIS OFFICE WILL CONTINUE TO MAKE SETTLEMENTS IN SIMILAR CASES ALLOWING INTEREST ONLY AS PROVIDED FOR IN THE ACT OF FEBRUARY 26, 1931, AS QUALIFIED BY SECTION 319 OF THE ECONOMY ACT OF JUNE 30, 1932. SEE DECISION OF JULY 22, 1932, A-43355,12 COMP. GEN. 103.