B-19202, AUGUST 13, 1941, 21 COMP. GEN. 125

B-19202: Aug 13, 1941

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NEED ONLY OBTAIN SUCH TITLE AS IN ITS JUDGMENT WILL PROTECT THE INTERESTS OF THE GOVERNMENT. IS WARRANTED IN THE PARTICULAR CASE. 1941: I HAVE YOUR LETTER OF JULY 26. WAS AMENDED BY THE ACT OF OCTOBER 9. SUCH WAIVER WILL NOT JEOPARDIZE THE INTERESTS OF THE UNITED STATES.'. THE QUESTIONS ARE AS FOLLOWS: 1. WILL PROTECT THE INTERESTS OF THE GOVERNMENT? 2. IN EVERY CASE OBTAIN FULL AND COMPLETE EVIDENCE OF THE CONDITION OF THE RECORD TITLE IT IS GETTING REGARDLESS OF THE COST AND LACK OF PRACTICAL NEED FOR DOING SO. IS WARRANTED IN THE PARTICULAR CASE? BELIEVE THAT AN OUTLINE OF THE CIRCUMSTANCES SURROUNDING THESE TWO TYPES OF EASEMENT PURCHASES WILL BE HELPFUL TO YOUR CONSIDERATION OF THE QUESTIONS BEING ASKED.

B-19202, AUGUST 13, 1941, 21 COMP. GEN. 125

REAL ESTATE - ACQUISITION OF EASEMENTS OR RIGHTS-OF-WAY - TITLE REQUIREMENTS WHERE, IN CONNECTION WITH THE ACQUISITION OF EASEMENTS OR RIGHTS-OF WAY, THE ATTORNEY GENERAL WAIVES THE REQUIREMENT FOR HIS TITLE OPINION, THE BONNEVILLE POWER ADMINISTRATION MAY PURCHASE EASEMENTS UNDER THE AUTHORITY OF THE BONNEVILLE PROJECT ACT OF 1937 WITHOUT OBTAINING PERFECT TITLE, AND NEED ONLY OBTAIN SUCH TITLE AS IN ITS JUDGMENT WILL PROTECT THE INTERESTS OF THE GOVERNMENT, BUT SUCH DISCRETION MAY NOT TRANSCEND THE LIMITS IMPOSED OR CONTEMPLATED BY THE LEGISLATION AUTHORIZING THE ACQUISITION OR BE EXERCISED IN AN ARBITRARY OR UNREASONABLE MANNER, AND WOULD NOT JUSTIFY PAYMENTS TO PERSONS HAVING NO COLOR OF RIGHT, INTEREST OR TITLE IN THE LAND TO CONVEY. WHERE, IN CONNECTION WITH THE ACQUISITION OF EASEMENTS OR RIGHTS-OF WAY BY THE BONNEVILLE POWER ADMINISTRATION, THE ATTORNEY GENERAL WAIVES THE REQUIREMENT FOR HIS TITLE OPINION, THE ADMINISTRATION IN SUPPORT OF ITS PAYMENTS THEREFOR NEED OBTAIN ONLY SUCH TITLE EVIDENCE AS, IN ITS JUDGMENT, IS WARRANTED IN THE PARTICULAR CASE, BUT SHOULD FURNISH A SHOWING OF WAIVER BY THE ATTORNEY GENERAL, AN APPROPRIATE ADMINISTRATIVE STATEMENT OF THE PAYEE'S CLAIMED INTEREST IN THE LAND, AND THE EVIDENCE REASONABLY RELIED ON BY THE ADMINISTRATOR IN VERIFICATION OF THE PAYEE'S CLAIM OF INTEREST.

COMPTROLLER GENERAL WARREN TO THE SECRETARY OF THE INTERIOR, AUGUST 13, 1941:

I HAVE YOUR LETTER OF JULY 26, 1941, IN PART AS FOLLOWS:

SECTION 355 OF THE REVISED STATUTES (40 U.S.C. SEC. 255), WHICH REQUIRES FEDERAL AGENCIES PURCHASING ANY SITE OR LAND FOR THE PURPOSE OF ERECTING A "PUBLIC BUILDING" THEREON TO OBTAIN THE ATTORNEY GENERAL'S OPINION AS TO THE "VALIDITY" OF THE TITLE TO THE SITE OR LAND BEFORE EXPENDING PUBLIC FUNDS FOR THE ACQUISITION OR IMPROVEMENT THEREOF, WAS AMENDED BY THE ACT OF OCTOBER 9, 1940, CHAPTER 793 (54 STAT. 1083), TO PROVIDE AMONG OTHER THINGS THAT:

"* * * THE ATTORNEY GENERAL MAY, IN HIS DISCRETION, WAIVE THE REQUIREMENT FOR HIS OPINION IN CONNECTION WITH THE ACQUISITION OR IMPROVEMENT OF EASEMENTS AND RIGHTS-OF-WAY * * * WHEN IN HIS OPINION, SUCH WAIVER WILL NOT JEOPARDIZE THE INTERESTS OF THE UNITED STATES.'

IN VIEW OF THIS AMENDMENT THE BONNEVILLE POWER ADMINISTRATION DESIRES YOUR OPINION ON TWO QUESTIONS IN CONNECTION WITH ITS ACQUISITION AND IMPROVEMENT OF EASEMENTS AND RIGHTS-OF-WAY PURSUANT TO THE BONNEVILLE ACT (ACT OF AUGUST 20, 1937, 50 STAT. 731, 16 U.S.C. SEC. 832). BOTH OF THESE QUESTIONS CONCERN THE PROCEDURE TO BE FOLLOWED BY BONNEVILLE IN THE EVENT THAT THE ATTORNEY GENERAL, IN HIS DISCRETION, WAIVES THE REQUIREMENT FOR HIS OPINION AS TO THE EASEMENTS BEING ACQUIRED. THE QUESTIONS ARE AS FOLLOWS:

1. ASSUMING SUCH A WAIVER BY THE ATTORNEY GENERAL, MUST BONNEVILLE IN ITS PURCHASE OF EASEMENTS UNDER THE BONNEVILLE ACT IN ALL CASES OBTAIN SUBSTANTIALLY PERFECT TITLE TO ITS EASEMENTS, REGARDLESS OF COST AND REGARDLESS OF THE LIMITED NEEDS OF THE GOVERNMENT; OR, MAY IT PURCHASE SUCH TITLE TO THE EASEMENTS AS, IN ITS JUDGMENT, WILL PROTECT THE INTERESTS OF THE GOVERNMENT?

2. IF YOU CONCLUDE THAT WHEN THE ATTORNEY GENERAL WAIVES THE NECESSITY FOR HIS OPINION, THE BONNEVILLE ACT PERMITS BONNEVILLE, IN APPROPRIATE CASES, TO PURCHASE EASEMENTS WITHOUT OBTAINING SUBSTANTIALLY PERFECT TITLE THERETO, MUST BONNEVILLE, NEVERTHELESS, IN EVERY CASE OBTAIN FULL AND COMPLETE EVIDENCE OF THE CONDITION OF THE RECORD TITLE IT IS GETTING REGARDLESS OF THE COST AND LACK OF PRACTICAL NEED FOR DOING SO; OR, UNDER THE BONNEVILLE ACT, MAY BONNEVILLE OBTAIN ONLY SUCH TITLE EVIDENCE AS, IN ITS JUDGMENT, IS WARRANTED IN THE PARTICULAR CASE?

THESE QUESTIONS ARISE IN CONNECTION WITH THE PURCHASE OF EASEMENTS IN THE COURSE OF BONNEVILLE'S OWN CONSTRUCTION PROGRAM AND ALSO IN CONNECTION WITH THE PURCHASE OF THE PROPERTIES OF PRIVATELY OWNED UTILITIES. BELIEVE THAT AN OUTLINE OF THE CIRCUMSTANCES SURROUNDING THESE TWO TYPES OF EASEMENT PURCHASES WILL BE HELPFUL TO YOUR CONSIDERATION OF THE QUESTIONS BEING ASKED.

A LARGE PART OF THE LAND ACROSS WHICH EASEMENTS ARE OBTAINED FOR THE CONSTRUCTION OF BONNEVILLE'S TRANSMISSION LINES IS OF EXTREMELY LOW VALUE. IN THE DESERT AREAS OF EASTERN OREGON AND WASHINGTON, FOR EXAMPLE, MUCH OF THE LAND IS COVERED WITH SAGEBRUSH AND AT BEST IS USEFUL ONLY FOR GRAZING. IN THE WESTERN AREAS THE TRANSMISSION LINES CROSS DOZENS OF MILES OF LOGGED OFF WASTE LANDS. SUCH LANDS CAN BE PURCHASED OUTRIGHT FOR $5.00 TO $10.00 AN ACRE. WHEN IT IS CONSIDERED THAT THE TRANSMISSION LINES USUALLY HAVE A MINIMUM CLEARANCE IN EXCESS OF THIRTY FEET AND THAT THE POLES OR STRUCTURES ARE LOCATED FROM 800 TO 1,200 FEET APART, IT IS APPARENT THAT INTERFERENCE WITH NORMAL USE OF THE LANDS IS NEGLIGIBLE. HAS THEREFORE BEEN POSSIBLE TO PURCHASE EASEMENTS ACROSS SUCH LANDS FOR A NOMINAL CONSIDERATION.

UNFORTUNATELY, HOWEVER, THE OWNERS OF SUCH LOW-VALUE LAND FREQUENTLY GIVE LITTLE ATTENTION, AND LESS MONEY, TO THE CONDITION OF THEIR TITLES. FOR EXAMPLE, IN DOZENS OF CASES THERE HAS BEEN FAILURE EVEN TO RECORD THE ORIGINAL PATENT FROM THE GOVERNMENT. WITH RESPECT TO SUCH LOW-VALUE LANDS, THE COST TO BONNEVILLE OF OBTAINING COMPLETE EVIDENCE OF RECORD TITLE AND PURCHASING EASEMENTS ONLY WHEN TITLE IS CLEAR OR HAS BEEN PERFECTED HAS BEEN UNDULY HIGH, EXCEEDING MANY TIMES OVER THE CONSIDERATION PAID TO THE OWNER.

CONSIDER, FOR EXAMPLE, BONNEVILLE'S EXPERIENCE TO MARCH 31 OF THIS YEAR ON THE CONDIT-GLENWOOD LINE IN KLICKITAT COUNTY, WASHINGTON. THIS LINE WAS CONSTRUCTED PRIOR TO THE ABOVE QUOTED AMENDMENT TO SECTION 355 AND THE EASEMENT COSTS THEREOF ARE AN EXAMPLE OF THE COSTS OF OBTAINING COMPLETE TITLE EVIDENCE SHOWING CONVEYANCE OF "VALID" TITLE TO THE GOVERNMENT AS FORMERLY REQUIRED BY SECTION 355. AN EASEMENT RIGHT-OF-WAY 7.84 MILES LONG, CONTAINING 47.71 ACRES AND INVOLVING 42 SEPARATE TRACTS, WAS ACQUIRED. EASEMENTS WERE ACQUIRED FROM LANDOWNERS IN MOST CASES FOR A CONSIDERATION OF $5.00, THE TOTAL CONSIDERATION FOR ALL EASEMENTS BEING $290.00. TITLE CERTIFICATES, UNDER THE PREVAILING CONTRACT PRICE OF $30.00 A TRACT, AMOUNTED TO $1,260.00. IN ORDER TO SECURE CURATIVE DATA NECESSARY TO MAKE SURE THAT "VALID" TITLE TO THE EASEMENTS WAS OBTAINED AND IN ORDER TO PREPARE THE REQUIRED CLOSING PAPERS, THE TIME OF AN ATTORNEY AND A STENOGRAPHER WAS REQUIRED FOR APPROXIMATELY FORTY-TWO DAYS. INCLUDING TRAVEL EXPENSE AND PER DIEM, THE TITLE COST CHARGEABLE TO THIS CURATIVE AND CLOSING WORK, EXCLUSIVE OF OFFICE OVERHEAD, AMOUNTED TO APPROXIMATELY $630.00. THE TOTAL COST OF TITLE WORK, THEREFORE, WAS $1,890.00, FOR EASEMENTS COSTING $290.00. EVEN ASSUMING THAT THE UNAVOIDABLE COST OF PREPARING THE CLOSING PAPERS AND OBTAINING THEIR EXECUTION AMOUNTED TO $10.00 AN EASEMENT, WHICH IT PROBABLY DID NOT, THE GOVERNMENT WAS REQUIRED TO EXPEND FIVE TIMES AS MUCH TO SATISFY ITSELF THAT IT WAS GETTING TITLE WHICH IN THE ATTORNEY GENERAL'S OPINION WAS "VALID" AS IT PAID FOR THE EASEMENT RIGHTS OBTAINED.

"EVEN WHERE LINES ARE CONSTRUCTED ACROSS VALUABLE FARM LANDS, EASEMENTS CAN USUALLY BE ACQUIRED AT VERY LOW PRICES IN COMPARISON WITH ORDINARY TITLE COSTS, BECAUSE, EXCEPT AT POLE OR STRUCTURE LOCATIONS, THE EASEMENT DOES NOT INTERFERE WITH NORMAL USE OF THE LAND FOR FARMING. OUT OF 809 CASES UNCLOSED ON DECEMBER 31, 1940, OPTIONS HAD BEEN OBTAINED IN 603, OR MORE THAN 74 1/2 PERCENT, TO PURCHASE EASEMENTS FOR LESS THAN $100.00. PROTECT SUCH SMALL INVESTMENTS THE GOVERNMENT HAS BEEN FORCED TO SPEND AN AVERAGE OF $21.63 FOR ALL TITLE CERTIFICATES AND AN AVERAGE OF $33.06 FOR ALL TITLE WORK, A TOTAL OF $54.69 FOR EACH EASEMENT.

"PRIVATELY OWNED UTILITY COMPANIES HAVE LONG RECOGNIZED THE FOLLY OF SPENDING SUBSTANTIAL SUMS FOR INVESTIGATION OF TITLE TO LAND ACROSS WHICH RIGHT-OF-WAY EASEMENTS ARE DESIRED. IT IS AN ALMOST STANDARD PRACTICE IN THE INDUSTRY TO BUY EASEMENTS ON THE BASIS OF ONLY THE SKETCHIEST TITLE INVESTIGATION, AND SOMETIMES WITHOUT ANY INVESTIGATION AT ALL. THE UNIVERSAL EXPERIENCE OF THE PRIVATE COMPANIES INDICATES THAT THEIR BUSINESS JUDGMENT HAS BEEN GOOD. LITTLE IF ANY LOSS HAS RESULTED, AND THE SAVINGS OVER THE COST OF OBTAINING COMPLETE TITLE EVIDENCE AND PERFECTING TITLE ARE TREMENDOUS. WE ARE ADVISED THAT THE PRACTICE AND EXPERIENCE OF THE AMERICAN TELEPHONE AND TELEGRAPH COMPANY AND ITS AFFILIATED COMPANIES IS SIMILAR.

IN ADDITION TO ACQUIRING FROM LANDOWNERS RIGHT-OF-WAY EASEMENTS FOR THE CONSTRUCTION OF NEW LINES, BONNEVILLE HAS ALREADY PURCHASED EXISTING TRANSMISSION LINES, INCLUDING EASEMENTS THEREFOR, FROM TWO PRIVATELY OWNED UTILITY COMPANIES, AND IS NOW CONDUCTING NEGOTIATIONS FOR THE PURCHASE OF THE TRANSMISSION FACILITIES OF SEVERAL OTHER COMPANIES. IN THE CASE OF ONE OF THE COMPANIES WITH WHICH NEGOTIATIONS ARE PENDING, APPROXIMATELY 18,000 EASEMENTS WILL BE TRANSFERRED TO THE GOVERNMENT IF THE SALE IS EFFECTED. LIKE MOST OTHER SUCH COMPANIES, THIS COMPANY ACQUIRED THESE EASEMENTS WITHOUT EXTENDED TITLE SEARCHES, AND MANY OF ITS TITLES ARE DOUBTLESS IMPERFECT. HOWEVER, ITS LINES ARE IN EXISTENCE AND OPERATION, AND HAVE BEEN FOR YEARS. INDEED, THE EASEMENTS HAVE BEEN IN THE QUIET BUT ADVERSE AND NOTORIOUS POSSESSION OF THE COMPANY FOR CONSIDERABLY IN EXCESS OF THE STATUTORY PERIOD FOR BRINGING ACTIONS FOR POSSESSION. THE RECORDS OF THE COMPANIES ARE OPEN TO THE GOVERNMENT. NO ADVERSE OR PARAMOUNT CLAIMS ARE BEING ASSERTED AGAINST THE EASEMENTS.

IF ANOTHER PRIVATE COMPANY WERE BUYING THESE LINES, IT WOULD TAKE TITLE TO THESE EASEMENTS ON AN "AS IS" BASIS. IF BONNEVILLE MUST OBTAIN COMPLETE TITLE EVIDENCE AND PURCHASE THE EASEMENTS ONLY WHEN IT CONSIDERS TITLE UNQUESTIONABLE, IT WILL HAVE TO SPEND THE NECESSARY SUMS ITSELF SINCE THE SELLING COMPANY HAS ADVISED US THAT IT WILL NOT UNDERTAKE TO CONVEY PERFECT TITLE. BONNEVILLE'S PURCHASE OF CERTIFICATES OR ABSTRACTS OF TITLE AND ITS EFFORTS TO CURE ALL DEFECTS IN THE TITLES TO THE EASEMENTS WILL INVOLVE AN EXPENDITURE OF APPROXIMATELY $1,000,000. THE JUDGMENT AND EXPERIENCE OF THE UTILITY INDUSTRY SHOWS THAT THIS EXPENDITURE OF PUBLIC FUNDS WOULD BE WHOLLY UNWARRANTED. MOREOVER, IF BONNEVILLE MUST FOLLOW SUCH A COURSE, THE TIME NEEDED TO OBTAIN AND EXAMINE COMPLETE TITLE EVIDENCE AND TO CURE ALL DEFECTS WILL INVOLVE A CONSEQUENT DELAY IN PAYMENT FOR THE PROPERTY WHICH WILL SERIOUSLY JEOPARDIZE THE CONSUMMATION OF THE SALE.

THE FOREGOING DISCUSSION SHOULD MAKE IT PLAIN THAT AS A PRACTICAL MATTER IN BUYING THE LOW-COST EASEMENTS IT NEEDS FOR THE CONSTRUCTION OF NEW LINES, BONNEVILLE SHOULD FOLLOW THE TITLE PRACTICES THAT ARE STANDARD IN THE UTILITY INDUSTRY. THAT IS, BONNEVILLE SHOULD EXAMINE THE TAX ROLLS AND PERHAPS THE LAST DEED OF RECORD, AND SHOULD QUESTION THE PERSONS IN POSSESSION OF THE LAND. IT SHOULD THEN ACCEPT A WARRANTY DEED SUBJECT TO SUCH OUTSTANDING INTERESTS OR INFIRMITIES AS THE ADMINISTRATOR HAS DISCOVERED AND IN HIS DISCRETION HAS WAIVED AS NOT PREJUDICIAL TO THE BEST INTERESTS OF THE GOVERNMENT. THIS PROCEDURE SHOULD NOT BE INFLEXIBLE. OBVIOUSLY, LESS TITLE EXPENSE SHOULD BE INCURRED WHEN THE PRICE PAID FOR THE EASEMENT IS SMALL, AND MORE TITLE EXPENSE SHOULD BE INCURRED WHEN THE PRICE PAID FOR THE EASEMENT IS SUBSTANTIAL; THERE WILL BE TIMES, ESPECIALLY WHEN A LARGE SUM IS BEING PAID FOR AN EASEMENT, WHEN BONNEVILLE CLEARLY SHOULD OBTAIN COMPLETE TITLE CERTIFICATES OR ABSTRACTS AND CURE ALL TITLE DEFECTS.

IT SHOULD ALSO BE PLAIN THAT IN BUYING AN EXISTING UTILITY SYSTEM, BONNEVILLE SHOULD ACCEPT THE COMPANY'S LINES, INCLUDING THE TITLES TO ITS EASEMENTS, AS THEY ARE. INDEED IT WOULD SEEM PARTICULARLY UNWISE TO INSIST ON THE DISCOVERY AND REMOVAL OF EVERY TITLE DEFECT IN THESE PURCHASES, SINCE TO DO SO WOULD INVOLVE FERRETING OUT THE HOLDERS OF CLOUDS ON THE TITLES TO THE SELLING COMPANY'S EASEMENTS AND INVITING THEM TO PRESENT CLAIMS WHICH OTHERWISE THEY MIGHT HAVE ALLOWED TO BE DORMANT.

BEFORE LEAVING THIS DISCUSSION, IT IS IMPORTANT TO POINT OUT THAT IN BUYING EASEMENTS ON THIS BASIS, BONNEVILLE WOULD NOT BE TAKING SUBSTANTIAL RISKS. AS HAS ALREADY BEEN SAID, THE EXPERIENCE OF THE UTILITY INDUSTRY SHOWS THAT FEW, IF ANY, OF THE TITLES TO BONNEVILLE'S EASEMENTS WOULD EVER BE QUESTIONED. THIS IS BECAUSE IN A GREAT MAJORITY OF CASES THE LANDOWNER'S USE OF THE LAND IS NOT MATERIALLY PREJUDICED BY THE PRESENCE OF THE TRANSMISSION LINE. IT IS AN OBSERVED FACT THAT WHEN THE OWNERSHIP OF LAND PASSES, FOR EXAMPLE, FROM MORTGAGOR TO MORTGAGEE, OR FROM VENDOR TO VENDEE, THE NEW OWNER DOES NOT ORDINARILY QUESTION THE PRESENCE ON THE LAND OF AN ELECTRIC POWER LINE. THIS IS, OF COURSE, PARTICULARLY TRUE IN THE CASE OF LOW VALUE LANDS SINCE THE SMALL AMOUNT OF MONEY INVOLVED IN THESE CASES DOES NOT JUSTIFY THE NEW OWNER IN BRINGING LEGAL PROCEEDINGS AGAINST THE OWNER OF THE POWER LINES.

HOWEVER, IN THE IMPROBABLE EVENT THAT A HIDDEN DEFECT IN THE TITLE TO BONNEVILLE'S EASEMENT SHOULD BE ASSERTED AT A FUTURE TIME, SEVERAL PROTECTIONS WOULD STILL BE AVAILABLE TO BONNEVILLE. IN THE FIRST PLACE, TO THE EXTENT THAT THE DEFECT WAS NOT EXCEPTED THEREFROM, BONNEVILLE COULD RECOVER AGAINST THE SELLER ON HIS WARRANTY. IN THE SECOND PLACE, IF THE CLAIMANT ASSERTED HIS RIGHT ON THE BASIS OF AN UNRECORDED INTEREST, BONNEVILLE WOULD HAVE THE PROTECTION OF THE RECORDING ACTS. IN THE THIRD PLACE, BONNEVILLE COULD RELY ON THE STATUTE OF LIMITATIONS AND WOULD SUCCEED TO ANY PROTECTION THEREUNDER WHICH THE ORIGINAL VENDOR OF THE EASEMENT MAY HAVE HAD. IN THE FOURTH PLACE, BONNEVILLE COULD MAKE ANY EQUITABLE DEFENSES WHICH THE ORIGINAL VENDOR MAY HAVE HAD AGAINST THE ASSERTION OF THE OUTSTANDING INTERESTS. IN THE CASE OF THE ACQUISITION OF AN EXISTING SYSTEM THIS WOULD BE A PARTICULARLY VALUABLE RIGHT SINCE IT IS THE DUTY OF THE CLAIMANTS PROMPTLY TO MAKE THEIR INTEREST KNOWN AS SOON AS THE LINE IS CONSTRUCTED AND EASEMENT THEREBY MADE OPEN AND NOTORIOUS. NITTANY VALLEY R. CO. V. EMPIRE STEEL AND IRON CO., 218 PA. 24; 67 ATL. 349 (1907). LASTLY, IT SHOULD BE NOTED THAT WHERE THE GOVERNMENT CONSTRUCTS TRANSMISSION LINES ITS PURCHASE OF AN EASEMENT LIKEWISE BECOMES OPEN AND NOTORIOUS, ENABLING IT TO MAKE EQUITABLE DEFENSES IN ADDITION TO THOSE WHICH THE ORIGINAL VENDOR MAY HAVE HAD. BUT EVEN ASSUMING THE REMOTE POSSIBILITY THAT IN A FEW CASES AN INTEREST PARAMOUNT TO THE GOVERNMENT'S INTEREST WOULD BE ASSERTED AND PROVED, BONNEVILLE COULD REPURCHASE THE EASEMENT AT LITTLE MORE EXPENSE THAN THE COSTS OF A PRIOR TITLE EXAMINATION. IF THE HOLDER OF THE PARAMOUNT INTEREST REFUSED TO RECOGNIZE THE EASEMENT FOR A REASONABLE CONSIDERATION, A NEW EASEMENT COULD ALWAYS BE CONDEMNED. IF SUCH A CONDEMNATION WERE BROUGHT, THE DEFENDING LANDOWNER'S DAMAGES WOULD BE MEASURED BY THE VALUE OF THE EASEMENT ALONE, WITHOUT INCLUDING THE VALUE OF THE GOVERNMENT'S IMPROVEMENTS. THIS IS THE GENERAL RULE, AND IT HAS BEEN ADOPTED IN BOTH OREGON AND WASHINGTON WHERE BONNEVILLE CONSTRUCTION AND ACQUISITIONS TAKE PLACE. SEARL V. SCHOOL DISTRICT, 133 U.S. 553 (1890); CONSOLIDATED CO. V. NORFOLK CO., 228 U.S. 596 (1913); STATE V. MOHLER, 115 ORE. 562, 237 PAC. 690 (1925); SEATTLE AND N.R. CO. V. CORBETT, 22 WASH. 189, 60 PAC. 127 (1900).

SINCE IT IS PARTICULARLY IN THE CASE OF LOW-COST EASEMENTS THAT BONNEVILLE IS SEEKING RELIEF FROM HIGH TITLE COSTS, AND SINCE ONLY IN RARE INSTANCES WOULD BONNEVILLE FIND IT NECESSARY TO REPURCHASE SUCH AN EASEMENT, IT SHOULD BE CLEAR THAT THE EXPENSE INVOLVED IN REPURCHASING AN OCCASIONAL LOW-COST EASEMENT WOULD BE FAR LESS THAN THE COST OF SECURING COMPLETE TITLE EVIDENCE AND CLEARING ALL TITLE DEFECTS TO ALL SUCH EASEMENTS.

CONSIDERING THE BROAD AUTHORITY OF THE BONNEVILLE ACT AND THE ABSENCE OF RESTRICTIONS IN ANY OTHER STATUTE PROVIDED THE ATTORNEY GENERAL HAS WAIVED THE REQUIREMENT FOR HIS OWN OPINION, IT IS SUBMITTED THAT THE BONNEVILLE POWER ADMINISTRATOR MAY ACQUIRE AND IMPROVE RIGHT-OF-WAY EASEMENTS WITH SUCH TITLE AND UPON SUCH EVIDENCE AS HE DETERMINES TO BE IN THE BEST INTERESTS OF THE GOVERNMENT.

YOUR VIEWS WITH RESPECT TO THESE MATTERS ARE RESPECTFULLY REQUESTED.

IN DECISION OF FEBRUARY 21, 1940, 19 COMP. GEN. 739, IT WAS HELD THAT PAYMENTS FOR POWER TRANSMISSION LINE EASEMENTS FOR THE BONNEVILLE PROJECT COULD NOT LAWFULLY BE MADE WITHOUT OBTAINING THE ATTORNEY GENERAL'S APPROVAL OF TITLES PURSUANT TO SECTION 355, REVISED STATUTES.

SECTION 355, REVISED STATUTES, WAS SUBSEQUENTLY AMENDED BY THE ACT OF OCTOBER 9, 1940, PUBLIC, NO. 825 (54 STAT. 1083), TO READ IN PART AS FOLLOWS:

NO PUBLIC MONEY SHALL BE EXPENDED UPON ANY SITE OR LAND PURCHASED BY THE UNITED STATES FOR THE PURPOSES OF ERECTING THEREON ANY ARMORY,ARSENAL, FORT, FORTIFICATION, NAVY YARD, CUSTOMHOUSE, LIGHTHOUSE, OR OTHER PUBLIC BUILDING OF ANY KIND WHATEVER, UNTIL THE WRITTEN OPINION OF THE ATTORNEY GENERAL SHALL BE HAD IN FAVOR OF THE VALIDITY OF THE TITLE.

NOTWITHSTANDING THE PROVISIONS OF THIS OR ANY OTHER LAW, WHENEVER THE AVERAGE VALUE OF ANY LANDS OR INTERESTS IN LAND TO BE ACQUIRED BY OR ON BEHALF OF THE UNITED STATES UNDER A SINGLE OPTION OR CONTRACT OF SALE DOES NOT EXCEED $10 PER ACRE (HEREINAFTER REFERRED TO AS "LOW VALUE LANDS"), THE TITLE MAY BE ACCEPTED SUBJECT TO SUCH INFIRMITIES AS, IN THE OPINION OF THE ATTORNEY GENERAL, MAY, WITHOUT JEOPARDIZING THE INTERESTS OF THE UNITED STATES, BE LEFT FOR REMOVAL BY CONDEMNATION OR OTHER APPROPRIATE PROCEEDINGS, IF AND WHEN NECESSARY: PROVIDED, THAT THE TOTAL VALUE OF ANY LANDS OR INTERESTS TO BE ACQUIRED UNDER A SINGLE OPTION OR CONTRACT OF SALE SUBJECT TO AN INFIRMITY DOES NOT EXCEED $3,500. NO PUBLIC MONEY SHALL HEREAFTER BE EXPENDED FOR THE ACQUISITION OF SUCH LOW-VALUE LANDS OR INTERESTS IN LAND BY OR ON BEHALF OF THE UNITED STATES FOR ANY PURPOSE UNTIL THE WRITTEN OPINION OF THE ATTORNEY GENERAL HAS BEEN HAD APPROVING THE TITLE SUBJECT, IF EXPEDIENT, TO INFIRMITIES AS HEREIN PROVIDED. HOWEVER, NO MONEY IN EXCESS OF $2,500 SHALL BE EXPENDED FOR THE CONSTRUCTION OF BUILDINGS, WORKS, OR OTHER IMPROVEMENTS (EXCEPT ROADS, TRAILS, AND FIRE-PROTECTION IMPROVEMENTS) ON ANY SITE, TRACT, OR PARCEL OF LAND THE TITLE TO WHICH IS SUBJECT TO INFIRMITIES, UNTIL THE WRITTEN OPINION OF THE ATTORNEY GENERAL IN FAVOR OF THE VALIDITY OF THE TITLE HAS BEEN HAD AS IN THE CASE OF OTHER LANDS. FOR THE PURPOSE OF THIS ACT, VALUES OF LANDS AND INTERESTS IN LAND SHALL BE DETERMINED BY THE CONSIDERATION PAID OR TO BE PAID.

THE ATTORNEY GENERAL IS HEREBY AUTHORIZED TO APPROVE THE TITLE TO EASEMENTS OR RIGHTS-OF-WAY TO BE ACQUIRED BY OR ON BEHALF OF THE UNITED STATES, SUBJECT TO SUCH INFIRMITIES AS, IN HIS OPINION, WILL NOT JEOPARDIZE THE INTERESTS OF THE UNITED STATES.

THE FOREGOING PROVISIONS OF THIS SECTION SHALL NOT BE CONSTRUED TO AFFECT IN ANY MANNER ANY EXISTING PROVISIONS OF LAW WHICH ARE APPLICABLE TO THE ACQUISITION OF LANDS OR INTERESTS IN LAND BY THE TENNESSEE VALLEY AUTHORITY; AND NOTHING IN THIS SECTION SHALL BE CONSTRUED TO AFFECT IN ANY MANNER ANY AUTHORITY WHICH THE SECRETARY OF WAR, THE CHIEF OF ENGINEERS, OR THE SECRETARY OF THE INTERIOR HAVE UNDER THE PROVISIONS OF LAW IN FORCE ON THE DATE THIS SECTION AS AMENDED TAKES EFFECT WITH RESPECT TO THE APPROVAL BY THEM OF TITLE TO LAND OR INTERESTS IN LAND ACQUIRED BY THE WAR DEPARTMENT OR THE DEPARTMENT OF THE INTERIOR, AS THE CASE MAY BE. NOR SHALL THE FOREGOING PROVISIONS OF THIS SECTION, OR THE PROVISIONS OF ANY OTHER LAW, BE CONSTRUED TO REQUIRE ANY OPINION OF THE ATTORNEY GENERAL IN CONNECTION WITH THE ACQUISITION OR IMPROVEMENT OF EASEMENTS AND RIGHTS OF- WAY FOR MILITARY OR NAVAL PURPOSES; OR FOR THE ACQUISITION OR IMPROVEMENT OF EASEMENTS AND RIGHTS-OF-WAY BY THE DEPARTMENT OF AGRICULTURE FOR FOREST AND OTHER CONSERVATION PURPOSES WHERE THE COST OF ANY SUCH EASEMENT OF RIGHT-OF-WAY ACQUIRED UNDER A SINGLE INSTRUMENT OF CONVEYANCE AND THE COST OF ANY IMPROVEMENT THEREON DOES NOT EXCEED $2,500; AND THE ATTORNEY GENERAL MAY, IN HIS DISCRETION WAIVE THE REQUIREMENT FOR HIS OPINION IN CONNECTION WITH THE ACQUISITION OR IMPROVEMENT OF EASEMENTS AND RIGHTS-OF- WAY FOR OTHER PURPOSES WHEN, IN HIS OPINION, SUCH WAIVER WILL NOT JEOPARDIZE THE INTERESTS OF THE UNITED STATES.' ( ITALICS SUPPLIED.)

THE LAST PARAGRAPH QUOTED, FINISHING WITH THE WAIVER CLAUSE HERE IN QUESTION, WAS INCORPORATED IN THE ACT AS AN AMENDMENT RECOMMENDED BY THE HOUSE COMMITTEE ON THE JUDICIARY, THE COMMITTEE REPORT, HOUSE REPORT NO. 2514, SEVENTY-SIXTH CONGRESS, THIRD SESSION, MAKING THE FOLLOWING EXPLANATION:

THE AMENDMENT MADE BY THE COMMITTEE ON THE JUDICIARY WAS DRAFTED BY THE DEPARTMENT OF JUSTICE TO MEET THE REQUIREMENTS OF THE WAR DEPARTMENT, THE DEPARTMENT OF AGRICULTURE, AND THE TENNESSEE VALLEY AUTHORITY. UNDER THE AMENDMENT THE EXISTING PROVISIONS OF LAW APPLICABLE TO THE ACQUISITION OF LANDS OR INTERESTS IN LAND BY THE TENNESSEE VALLEY AUTHORITY WOULD NOT BE AFFECTED. NOR WOULD THERE BE REQUIRED AN OPINION OF THE ATTORNEY GENERAL IN CONNECTION WITH THE ACQUISITION OR IMPROVEMENT OF EASEMENTS AND RIGHTS- OF-WAY FOR MILITARY OR NAVAL PURPOSES; OR FOR THE ACQUISITION OR IMPROVEMENT OF EASEMENTS AND RIGHTS-OF-WAY BY THE DEPARTMENT OF AGRICULTURE FOR FOREST AND OTHER CONSERVATION PURPOSES WHERE THE COST OF ANY SUCH EASEMENT OR RIGHT-OF-WAY ACQUIRED UNDER A SINGLE INSTRUMENT OF CONVEYANCE AND THE COST OF ANY IMPROVEMENT THEREON DOES NOT EXCEED $2,500; AND THE ATTORNEY GENERAL IS EMPOWERED IN HIS DISCRETION TO WAIVE THE REQUIREMENT FOR HIS OPINION IN CONNECTION WITH THE ACQUISITION OR IMPROVEMENT OF EASEMENTS AND RIGHTS-OF-WAY FOR OTHER PURPOSES WHEN, IN HIS OPINION, SUCH WAIVER WILL NOT JEOPARDIZE THE INTERESTS OF THE UNITED STATES.

THUS THE BILL, AS FINALLY ENACTED, CONTAINED THE PROVISIONS OF THE ORIGINAL BILL, THIRD PARAGRAPH QUOTED, SUPRA, AUTHORIZING THE ATTORNEY GENERAL TO APPROVE THE TITLE TO EASEMENTS OR RIGHTS-OF-WAY TO BE ACQUIRED BY OR ON BEHALF OF THE UNITED STATES "SUBJECT TO SUCH INFIRMITIES AS, IN HIS OPINION, WILL NOT JEOPARDIZE THE INTERESTS OF THE UNITED STATES," TOGETHER WITH THE PROVISION SUBSEQUENTLY ADDED AUTHORIZING THE ATTORNEY GENERAL, IN HIS DISCRETION, TO "WAIVE THE REQUIREMENT FOR HIS OPINION IN CONNECTION WITH THE ACQUISITION OR IMPROVEMENT OF EASEMENTS AND RIGHTS-OF- WAY FOR OTHER PURPOSES WHEN, IN HIS OPINION, SUCH WAIVER WILL NOT JEOPARDIZE THE INTERESTS OF THE UNITED STATES.' THE TWO PROVISIONS, WHILE COMPLEMENTARY IN PURPOSE TO PERMIT THE ACQUISITION OF EASEMENTS AND RIGHTS -OF-WAY WITHOUT UNNECESSARY RESTRICTIONS, ARE DIFFERENT IN SCOPE AND OPERATION. UNDER THE FIRST, THE ATTORNEY GENERAL MAY APPROVE THE TITLE TO EASEMENTS OR RIGHTS-OF-WAY SUBJECT TO SUCH INFIRMITIES AS IN HIS OPINION WILL NOT JEOPARDIZE THE INTERESTS OF THE UNITED STATES. THIS, OF COURSE, CONTEMPLATES THAT THE ACTUAL CONDITION OF THE TITLE WILL BE EXAMINED BY THE ATTORNEY GENERAL TO DETERMINE WHAT INFIRMITIES EXIST AND WHETHER THEY SAFELY MAY BE WAIVED. THE SECOND PROVISION GOES MUCH FURTHER AND PERMITS THE ATTORNEY GENERAL TO WAIVE EVEN THE REQUIREMENT OF HIS OPINION AS TO THE CONDITION OF THE TITLE, WHERE, IN HIS DISCRETION, HE DETERMINES THAT SUCH COURSE SAFELY MAY BE FOLLOWED. IN CONTRAST WITH THE FIRST PROVISION, IN EFFECT AUTHORIZING A WAIVER OF INFIRMITIES IN TITLES TO EASEMENTS OR RIGHTS-OF-WAY, THIS SECOND PROVISION AUTHORIZING A WAIVER OF THE ATTORNEY GENERAL'S OPINION ON THE VALIDITY OF THE TITLE CONTEMPLATES THAT NO EXAMINATION OF THE TITLE NEED BE MADE BY THE ATTORNEY GENERAL IN SUCH CASES. THERE WOULD BE NO REASON FOR THE ATTORNEY GENERAL TO EXAMINE THE TITLE EXCEPT TO GIVE HIS OPINION THEREON, AND, CONSEQUENTLY, THE WAIVER OF THE TITLE OPINION CONNOTES THE ELIMINATION OF THE NEED FOR ANY TITLE EXAMINATION BY HIM IN SUCH CASES.

THE QUESTION HERE PRESENTED IS AS TO WHAT ADMINISTRATIVE EXAMINATION OF TITLES BY THE ACQUIRING AGENCY IS REQUIRED IN LIEU OF THE ATTORNEY GENERAL'S EXAMINATION AND OPINION IN CASES OR CLASSES OF CASES INVOLVING THE ACQUISITION OF EASEMENTS OR RIGHTS-OF-WAY, WHERE THE ATTORNEY GENERAL, PURSUANT TO THE STATUTE, HAS PREDETERMINED THAT A WAIVER OF HIS TITLE OPINION WILL NOT JEOPARDIZE THE INTERESTS OF THE UNITED STATES. CLEARLY, IF A STRICT EXAMINATION OF THE TITLE IN SUCH CASES WERE REQUIRED TO PROTECT THE INTERESTS OF THE GOVERNMENT, THERE WOULD BE NO OCCASION FOR THE ATTORNEY GENERAL TO WAIVE HIS OPINION, NOR REASONABLE BASIS FOR THE STATUTORY PROVISION AUTHORIZING SUCH WAIVERS IN THE ATTORNEY GENERAL'S DISCRETION. IT IS NOT TO BE ASSUMED THAT THE CONGRESS INTENDED BY SUCH PROVISION MERELY TO PERMIT THE TRANSFER TO THE ACQUIRING AGENCY OF THE NORMAL TITLE EXAMINATION DUTIES OF THE ATTORNEY GENERAL IN SUCH CASES, WITH THE RESULTING AND UNNECESSARY INCREASE, IF NOT DUPLICATION, OF WORK, PERSONNEL, AND EXPENSE. RATHER, THE PROVISION IS TO BE VIEWED AS COMMITTING TO THE ATTORNEY GENERAL THE DISCRETION TO DETERMINE IN WHAT CASES EASEMENTS AND RIGHTS-OF-WAY SAFELY MAY BE ACQUIRED AND UTILIZED WITHOUT THE USUAL STRICT EXAMINATION INTO THE CONDITION OF THE TITLES INVOLVED, AND AS THUS LEAVING LARGELY TO THE ACQUIRING AGENCY THE DETERMINATION OF WHAT EVIDENCE OF TITLE SHOULD BE OBTAINED IN SUCH CASES TO MEET THE REQUIREMENTS OF ITS PROGRAM UNDER AUTHORIZING STATUTES. THE OTHER HAND, SUCH DISCRETION IN THE ACQUIRING AGENCY IS A LEGAL DISCRETION, AND, OF COURSE, MAY NOT TRANSCEND THE LIMITS IMPOSED OR CONTEMPLATED BY LEGISLATION AUTHORIZING THE ACQUISITION OF THE EASEMENTS OR RIGHTS-OF WAY, OR BE EXERCISED IN AN ARBITRARY OR UNREASONABLE MANNER. IT WOULD NOT JUSTIFY PAYMENTS TO PERSONS HAVING NO COLOR OF RIGHT, INTEREST, OR TITLE IN THE LAND TO CONVEY.

SUBSECTIONS (B), (C), AND (F) OF SECTION 2 OF THE BONNEVILLE PROJECT ACT OF AUGUST 20, 1937, 50 STAT. 732-733, PROVIDE:

(B) IN ORDER TO ENCOURAGE THE WIDEST POSSIBLE USE OF ALL ELECTRIC ENERGY THAT CAN BE GENERATED AND MARKETED AND TO PROVIDE REASONABLE OUTLETS THEREFOR, AND TO PREVENT THE MONOPOLIZATION THEREOF BY LIMITED GROUPS, THE ADMINISTRATOR IS AUTHORIZED AND DIRECTED TO PROVIDE, CONSTRUCT, OPERATE, MAINTAIN, AND IMPROVE SUCH ELECTRIC TRANSMISSION LINES AND SUBSTATIONS, AND FACILITIES, AND STRUCTURES APPURTENANT THERETO, AS HE FINDS NECESSARY, DESIRABLE, OR APPROPRIATE FOR THE PURPOSE OF TRANSMITTING ELECTRIC ENERGY, AVAILABLE FOR SALE, FROM THE BONNEVILLE PROJECT TO EXISTING AND POTENTIAL MARKETS, AND, FOR THE PURPOSE OF INTERCHANGE OF ELECTRIC ENERGY, TO INTERCONNECT THE BONNEVILLE PROJECT WITH OTHER FEDERAL PROJECTS AND PUBLICLY OWNED POWER SYSTEMS NOW OR HEREAFTER CONSTRUCTED.

(C) THE ADMINISTRATOR IS AUTHORIZED, IN THE NAME OF THE UNITED STATES, TO ACQUIRE, BY PURCHASE, LEASE, CONDEMNATION, OR DONATION, SUCH REAL AND PERSONAL PROPERTY, OR ANY INTEREST THEREIN, INCLUDING LANDS, EASEMENTS, RIGHTS-OF-WAY, FRANCHISES, ELECTRIC TRANSMISSION LINES, SUBSTATIONS, AND FACILITIES AND STRUCTURES APPURTENANT THERETO, AS THE ADMINISTRATOR FINDS NECESSARY OR APPROPRIATE TO CARRY OUT THE PURPOSES OF THIS ACT. TITLE TO ALL PROPERTY AND PROPERTY RIGHTS ACQUIRED BY THE ADMINISTRATOR SHALL BE TAKEN IN THE NAME OF THE UNITED STATES.

(F) SUBJECT TO THE PROVISIONS OF THIS ACT, THE ADMINISTRATOR IS AUTHORIZED, IN THE NAME OF THE UNITED STATES, TO NEGOTIATE AND ENTER INTO SUCH CONTRACTS, AGREEMENTS, AND ARRANGEMENTS AS HE SHALL FIND NECESSARY OR APPROPRIATE TO CARRY OUT THE PURPOSES OF THIS ACT.

IN VIEW OF THIS BROAD STATUTORY AUTHORITY AND THE STATUTORY PURPOSES TO BE SERVED, I THINK THERE CAN BE NO REASONABLE DOUBT OF THE LEGAL AUTHORITY OF THE ADMINISTRATOR TO ACQUIRE EASEMENTS AND RIGHTS-OF-WAY ON THE BASIS AND UNDER THE CONDITIONS SET FORTH IN YOUR LETTER IN CASES WHERE THE ATTORNEY GENERAL, PURSUANT TO SECTION 355, REVISED STATUTES, AS AMENDED BY THE ACT OF OCTOBER 9, 1940, SUPRA, HAS WAIVED THE REQUIREMENT OF HIS OPINION IN CONNECTION THEREWITH. ACCORDINGLY, YOU ARE ADVISED THAT THIS OFFICE WILL NOT BE REQUIRED TO OBJECT TO PAYMENTS, OTHERWISE CORRECT AND PROPER, MADE IN CONNECTION WITH THE ACQUISITION OF EASEMENTS AND RIGHTS-OF -WAY ON SUCH BASIS WHERE IT IS SHOWN THAT THE ATTORNEY GENERAL HAS WAIVED THE REQUIREMENT FOR HIS OPINION, AND WHERE THE PAYMENT IS SUPPORTED BY AN APPROPRIATE ADMINISTRATIVE STATEMENT OF THE PAYEE'S CLAIMED INTEREST IN THE LAND OVER WHICH THE EASEMENT OR RIGHT-OF-WAY IS GRANTED AND OF THE EVIDENCE REASONABLY RELIED ON BY THE ADMINISTRATOR IN VERIFICATION OF SUCH CLAIM, E.G., ACTUAL OCCUPANCY OF THE LAND, TAX ROLLS, LAST CONVEYANCE OF RECORD, ETC. THE REQUIREMENT OF SUCH EVIDENCE IN SUPPORT OF PAYMENTS ACTUALLY MADE IN CONNECTION WITH THE ACQUISITION OF EASEMENTS AND RIGHTS- OF-WAY IS NOT TO BE UNDERSTOOD, HOWEVER, AS IMPLYING ANY REQUIREMENT THAT ALL OTHER POSSIBLE OUTSTANDING INTERESTS IN THE LAND MUST BE COVERED BEFORE PAYMENT IS MADE, THAT BEING A MATTER PRIMARILY OF ADMINISTRATIVE CONCERN IN DETERMINING WHAT RIGHTS SHOULD BE ACQUIRED SAFETY TO UTILIZE THE EASEMENTS UNDER ALL THE CIRCUMSTANCES INVOLVED.

IT FOLLOWS THAT INSOFAR AS THE EXPENDITURE OF PUBLIC FUNDS IS CONCERNED, THE FIRST PART OF THE FIRST QUESTION SPECIFICALLY STATED IN YOUR LETTER MAY BE ANSWERED IN THE NEGATIVE, THE SECOND PART OF SAID QUESTION IS ANSWERED IN THE AFFIRMATIVE, THE FIRST PART OF THE SECOND QUESTION IS ANSWERED IN THE NEGATIVE, AND THE SECOND PART THEREOF IN THE AFFIRMATIVE.