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December 3, 1959


The opinion of the court was delivered by: John E. Miller, Chief Judge.

On January 19, 1959, the plaintiff filed its complaint to acquire the fee simple title to certain property owned by the defendant, Arkansas & Ozarks Railway Corporation, hereinafter referred to as the railway corporation, and unknown parties, for use in connection with the Table Rock Dam and Reservoir Project.

On January 22, 1959, upon motion of the plaintiff, the court ordered:

    "* * * that all defendants in this action and all
  persons in possession or control of the property
  described in the complaint shall surrender possession
  of the said property to the plaintiff within five
  days after service of a copy of this order; provided,
  that the defendant, Arkansas & Ozarks Railway
  Corporation, may continue to use the said property at
  its own risk to the extent and for such time as its
  use does not interfere with the possession and use of
  the plaintiff."

On February 12, 1959, the court by order extended the time of the railway corporation 60 days from that date in which to file an answer or other responsive pleading. On April 10, 1959, the answer of the railway corporation was filed in which it, inter alia, alleged:

    "3. The defendant, Arkansas & Ozarks Railway
  Corporation, states that the plaintiff, United States
  of America, has previously in January of 1959,
  obtained an order for delivery of possession of the
  properties involved in this condemnation proceeding
  and that possession of said properties has been
  awarded to the plaintiff, United States of America,
  with a proviso that the defendant might continue to
  use the said property at its own risk to the extent
  and for such time as its use does not interfere with
  the possession or use of the plaintiff; the defendant
  states that such order imposes an undue burden of
  hardship upon the defendant, causing it to operate
  said properties at its own risk subject to any use
  the plaintiff might desire to make of said property
  including inundation thereof; the defendant asserts
  that the operation of a railroad under such
  conditions is extremely hazardous and unusually
  costly to it.
    "Defendant asserts that the action of the plaintiff
  in seeking to permit the defendant to continue to use
  said properties at its own risk and subject to any
  immediate possession of the plaintiff, is an attempt
  by the plaintiff to relieve itself of its
  responsibility not to overflow said railroad and to
  interfere with the operation thereof; that said
  proviso imposes a responsibility upon the defendant
  for the acts of the plaintiff regardless of how or
  when taken.
    "Defendant further asserts that in view of the
  order of possession to the plaintiff and the
  hazardous conditions under which defendant is allowed
  to continue said operation, this cause should be set
  for an immediate trial at which time the defendant
  will introduce evidence as to the value of the
  property and just compensation to it for the taking

On June 26, 1959, the plaintiff filed an amendment to its complaint, making a great number of individuals parties defendant, and alleged that said individuals have or claim to have an interest in the property taken. The purpose of such amendment was to bring in the former owners of the right-of-way in order that it might be determined whether the railway corporation owned the right-of-way in fee or owned merely an easement for the operation of the railroad. Following the making of such individuals as parties defendant, there have been answers filed by some persons claiming to be the owners of the fee in the right-of-way.

On August 25, 1959, the court entered an order requiring the parties to submit briefs in support of their contentions on the question of the measure of damages in this cause. The brief of the railway corporation was received October 6, 1959, and the brief of the plaintiff was received October 13, 1959.

On November 25, 1959, the plaintiff filed a "Motion for Pretrial Order," in which plaintiff, inter alia, alleged:

    "4. Before the parties can adequately prepare for
  trial they are entitled to know what is the measure
  of just compensation to be followed in this case.
    "Wherefore, plaintiff, United States of America,
  prays that the Court enter a pretrial order setting
  out the measure of just compensation in this case."

The railway corporation on its brief states:

    "The oddity of this problem of eminent domain
  requires an understanding, somewhat, of the total
  track facilities of condemnee. At the outset it is
  important to observe that it is a `one track'
  railroad, operating only between the towns of
  Seligman, Missouri (just over the Arkansas line in
  Missouri) to Harrison, Arkansas, a total distance of
  65.4 miles. It owns in toto 69 miles of trackage
  including some short spur lines from its main track
  into Berryville, Arkansas and Eureka Springs,
  Arkansas. On its one rail route from Seligman,
  southeasterly, to Harrison (population, 4238), the
  railroad furnishes freight service only to Eureka
  Springs (pop. 2914), Berryville (pop. 1482), Green
  Forest (pop. 755), and Alpena (pop. 313). The terrain
  over which this small one-track railroad traverses is
  quite mountainous, being located in the heart of the
  Ozark Mountains. For this reason it is very difficult
  to find a suitable path for the rails to be laid
  without increasing the cost of construction out of
  all proportion to the potential traffic. At its
  northwesterly terminus, Seligman, its tracks connect
  with the tracks of St. Louis-San Francisco Railroad
  Co., and at Harrison, its southeasterly terminus, it
  does not connect with any rail facility. Nor does it
  connect with or cross any other rail facility in its
  total 69 miles of trackage. It is an inlet for
  interstate freight traffic originating beyond
  Seligman and delivered there by the Frisco, as an
  interconnecting rail carrier, to the communities
  heretofore described, plus an outlet from those
  communities in reverse. Very little freight traffic
  both originates and terminates intrastate on its
  route, most of its business being deliveries into or
  out of its area of operation.
    "The understood location of the 2.064 miles of
  right-of-way here involved would place this flooded
  gap in its trackage only about eight to ten miles
  southeast of Seligman. Thus, and unless a feasible
  and economical substitute route can be constructed
  through this rough terrain, most, if not all of which
  is impassable, condemnee has been effectively and
  permanently put out of business the same as if the
  government was taking all of its physical properties.
  In this connection, it must be remembered that the
  White River runs generally north and south through
  Carroll, Benton and Washington Counties, in Arkansas,
  and there will always be the problem of crossing this
  river (in addition to the rough terrain), the level
  of which, we understand, will be greatly raised by
  the construction of the dam which creates the
  necessity for this proceeding."

The plaintiff on its brief states:

    "This action involves a `one-track' railroad as
  indicated by the brief filed by condemnee. In
  addition to the facts concerning it which condemnee
  wants understood, condemnor desires to point out that
  it operates no passenger facilities and operates only
  three trains per week. It originates a train at one
  terminus which travels to the other terminus that
  day. The next day the process is repeated in reverse,
  and so on, except

  that it operates no trains on Sunday."

The historical facts relating to the various attempts to operate the railroad are as follows:

A railroad, of which the part extending from Harrison, Arkansas, to Seligman, Missouri, was a part, was originally constructed in 1900-1903 by the Missouri & North Arkansas Railway Company. The line when completed extended originally from the City of Helena, Arkansas, on the Mississippi River, west and northwest to Neosho, Missouri, and thence to Joplin, Missouri, over leased tracks, a distance of 330.4 miles. Later, and after the Missouri & North Arkansas Railway Company had gone through a receivership, the ownership was transferred to the Missouri & Arkansas Railway Company, which undertook to operate the railroad as originally operated by the Missouri & North Arkansas Railway Company.

On September 6, 1946, the Missouri & Arkansas Railway Company ceased to operate the railroad, and on February 14, 1947, M.P. Gross and Sol Frankel filed a petition in this court for the appointment of a receiver "to take charge and possession of the property of the defendant corporation and to hold the same intact and to continue the prosecution and defense of any and all actions pending by or against the corporation, in any courts, and any proceedings pending before the Interstate Commerce Commission of the United States or any other governmental bodies; and plaintiffs also pray for such other and further relief as may be just and equitable in the premises."

In accordance with the petition, the court appointed receivers. The course of that case through this court was rather tortuous. See, Gross v. Missouri & Arkansas Ry. Co., D.C., 74 F. Supp. 242.

Subsequent to the opinion, the Interstate Commerce Commission, on August 9, 1948, issued its certificate permitting abandonment by the receivers of the Missouri & Arkansas Railway Company of all lines, ...

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