delivered the opinion of the court:
This matter involves a suit by the plaintiff gas corporation to condemn a subsurface geological strata under the land owned by the defendants for the purpose of storing gas underground. The condemnation suit did not seek the fee-simple title to the property but only the right to inject and withdraw gas from the St. Peter geological formation lying under the 160 acres of the defendants’ land. The trial court directed a verdict awarding the defendants the sum of $4000 as just compensation for the taking of this underground strata. From this judgment defendants appeal directly to this court. Ill. Rev. Stat. 1959, chap. 47, par. 12.
It appears from the record that on March 21, i960, the plaintiff filed a petition with the Illinois Commerce Commission for an order granting the plaintiff a certificate of public convenience and necessity for the testing, development, operation and maintenance of an underground gas-storage reservoir near the village of Mahomet, pursuant to the Illinois Public Utilities Act (Ill. Rev. Stat. 1959, chap. 111^3, par. 50, 56) and the Gas Storage Act (Ill. Rev. Stat. 1959, chap. 104, pars. 104, 105). The initial hearing before the Commerce Commission was set for April 21, i960, notice was sent by registered mail to the record owner of each privately owned tract of land in the storage area against which eminent domain was to be exercised, and notice was given by publication in a newspaper of general circulation, more than 21 days prior to the April 21, i960, hearing. Pursuant to such notices, hearings were held before the Commerce Commission and on July 29, i960, an order was entered by the Commission finding that there was reasonable expectation that the St. Peter geological formation in the vicinity of the village of Mahomet had a dome type of structure at approximately 1,650 feet below the surface, which might be utilized for the injection, storage and withdrawal of large quantities of gas. The dome-like structure covered approximately 23,000 acres with the primary area of somewhat less than 5000 acres at the crest of the structure which was to be the area for the initial development as a pilot or test operation. The order of the Commission made findings as to the nature of the geological structure; the absence of coal, gas, oil or mineral deposits in any commercial quantities; that notices had been sent to all land owners whose lands were to be subjected to condemnation; that the use of the gas-storage reservoir will not injure any water resources and will be confined to a geological stratum lying more than 500 feet below the surface of the soil; that the natural gas which is proposed to be stored would be used for ultimate distribution to the public in the city of Chicago and that the public convenience and necessity of a substantial portion of the gas-consuming public in the State of Illinois will be served by such gas-storage project. The order of Commission grants to the plaintiff under section 55 of the Public Utilities Act a certificate of public convenience and necessity to test, develop, construct, operate and maintain a gas-storage project and approves, under and pursuant to the provisions of the Natural Gas Storage Act, the development, construction, operation and maintenance of the underground natural gas-storage reservoir on a pilot operation. The order provides certain restrictive conditions protecting the rights of the owners of lands within the boundaries of the storage area and the public resources of the State, and for the carrying of public liability insurance.
No appeal was taken from the order of the Commission and thereafter on October 18, i960, the plaintiff filed the present action in the circuit court of Champaign County. The complaint alleged that plaintiff was a public utility and had obtained an order from the Commerce Commission authorizing an under ground storage project in the vicinity of the village of Mahomet in Champaign County involving some 4,390 acres and that the plaintiff had acquired, by voluntary grant, the necessary rights to enable it to undertake the underground storage of gas from the owners of the land lying within the test storage area, except as to the 160 acres belonging to the defendants and prayed that the court ascertain and assess the compensation to be paid to the defendants and that plaintiff have the right, privilege and easement to develop and conduct the gas-storage operation under such land.
Following the issuance of summons against the defendants and the disposition of certain motions, pretrial discovery and preliminary matters, the case came on for trial and the plaintiff introduced evidence that the defendants operated the 160 acres as a farm for the raising of grain and livestock, that it was improved with the usual farm buildings, that it was located in a rural farming area and that no oil or gas had ever been produced in the area.
The plaintiff also presented the evidence of three expert real-estate appraisal witnesses who each testified as to the value of the farm before taking and the value after taking, showing that there was a loss in value of $4000. By stipulation plaintiff agreed that its activities would be confined to the subsurface strata of the St. Peter formation and would not involve any part of the surface of defendants’ land.
The defendants attempted to introduce evidence that the highest and best use of the property was for the purpose of underground storage of gas and proposed through expert witnesses to show the value or worth of the underground storage easement was approximately $300,000, and that the taking of the easement diminished the value of the defendants’ land in that amount. The defendants’ evidence to this effect was rejected by the trial court after an extensive series of offers of proof and the trial court directed a verdict, since the only competent evidence which had been allowed to be introduced showed damages to the defendants by reason of the subsurface easement of $25 per acre. Judgment was accordingly entered on the verdict for $4000.
The defendants, appellants in this court, raise numerous grounds for reversing the judgment of the trial court. Basically, these fall into four principal categories. First, the matter of’ “jurisdictional proof” (as defendants characterize it) as a prerequisite for the faking of defendants’ land. This involves the validity of the order of the Commerce Commission and an asserted lack of certain other “jurisdictional requirements.” Second, the constitutionality of the Gas Storage Act of 1951. (Ill. Rev. Stat. 1959, chap. 104, pars. 104 et seq.) Third, errors of the trial court relating to rulings on continuances, discovery and the pleadings which defendants contend denied them due process of law. Fourth, the exclusion of all evidence of value offered by the defendants with the withdrawal of the case from the jury and the direction of a verdict.
Concerning defendants’ objections to the judgment of the lower court because of the lack of so-called “jurisdictional proof,” their first contention is that the condemnation petition does not refer expressly to the statute which authorizes plaintiff to exercise eminent domain. There is no merit to this contention. The complaint states that the right to enter upon and take or damage private property is conferred by the Public Utilities Act and the Gas Storage Act when ordered or authorized by an order of the Commerce Commission. Attached to the complaint is the order of the Commerce Commission which specifies not only the statutes but even the particular sections of the statutes under which the plaintiff proceeded. In determining whether a petition for condemnation sufficiently alleges the statutory requirements for condemning property, the Commission’s order attached to the petition as an exhibit must be considered in adjudging the sufficiency of the petition. (City of Chicago v. Central National Bank,
We likewise find no substance to the position of the defendants pertaining to the plaintiff’s failure to negotiate in good faith. We are of the opinion that an adequate attempt to acquire the property right by negotiation was made by plaintiff. A final letter offering defendants $45 per acre for storage rights was sent to the defendants and no response thereto was received. While such an attempt is sufficient to show adequate negotiation, (Public Service Co. of Northern Illinois v. Recktenwald,
Next defendants urge that the enabling order of the Commerce Commission is void because it is not supported by the requisite findings. However, orders of the Commerce Commission which are within its statutory authority are not void but voidable only, (People ex rel. Illinois Highway Transportation Co. v. Biggs,
Neither do we find the Gas Storage Act of 1951 unconstitutional. It is not special nor local legislation. (People ex rel. Dencen v. People’s Gas Light and Coke Co.
Nor is the Gas Storage Act an amendment by reference to the Public Utilities Act in violation of section 13 of article IV of the constitution. A careful examination of its provisions clearly shows that it is a complete and independent legislative enactment. Its application is limited to the acquisition by eminent domain of property rights for underground storage of gas, (Wilcox v. Commerce Com.
Whether underground storage rights could also be acquired through eminent domain by virtue of section 59 of the Public Utilities Act, where the Commission has ordered or authorized improvements under section 50 of that act, as contended by plaintiffs, we need not specifically decide.
The next category of defendants’ objections deals with the denial of due process in violation of constitutional rights because of the rulings of the trial court upon pretrial matters. While defendants list some 17 supposed “arbitrary actions” by the trial court which “constitute the denial of due process” they fail, in most cases, to point out wherein the ruling was erroneous other than being adverse to them. Rulings on continuances and most of the matters contained in defendants’ “specifications” were discretionary with the trial court and no abuse of discretion 'is shown. Furthermore, the request of the defendants and the rulings of the trial court in many of the complained-of instances relate to the theory of damages sought by the defendants and which we discuss later. As to the constitutional point of denial of due process, however, we have held that neither an abuse of discretion nor an erroneous rule of law as to damages or the refusal to admit evidence or grant continuances will support a reversal for violation of due process. (Chicago Land Clearance Com. v. Darrow,
We next turn to defendants’ primary argument and the basic issue in this proceeding, namely, the proper measure of damages to be used in determining the compensation payable to the defendants for impregnating with gas a subsurface strata lying under their land. The decision on this issue will determine the correctness of the trial court’s rulings on the admissibility and refusal of evidence and whether or not the defendants, by the directed verdict, were denied their right of trial by jury.
The measure of damages in a condemnation proceeding is “just compensation” and this is generally determined by the fair market value of the property taken. (17 I.L.P. 233, Eminent Domain, sec. 61; Central Illinois Public Service Co. v. Lee,
As we stated in Housing Authority of East St. Louis v. Kosydor,
While these general rules are applicable to the present case, there are no decisions in Illinois, and, so far as we have been able to determine, none in other jurisdictions, involving the condemnation of an underground gas-storage reservoir. Consequently, the measure of damages applicable to the taking of a subsurface geological formation is one of first impression. Moreover, gas-storage fields have been the subject of experimentations for several years and some have proven successful while others have not. There is no certainty that the Mahomet field will be successful. The order of the Commerce Commission merely finds that the St. Peter formation may be suitable and that a pilot operation may “prove the soundness of the Galena-Plattsville cap-rock and to provide performance data on the St. Peter storage formation.”
To understand the problem we must initially determine the nature of the taking. Plaintiff’s petition sought, and the judgment of the court gave the plaintiff the right, privilege and easement to introduce gas into the St. Peter geological strata and to store gas in such formation with the right to remove such gas with any water vapors absorbed. No taking of the fee or damages to the surface of the land is involved. Plaintiff’s taking amounts t.Q no more than an easement, and the usual measure of damages payable to such cases is based upon the diminution of the fair cash market value of the property burdened by the easement. North Shore Sanitary Dist. v. Schulik,
We know of no factors or considerations involved in the condemnation of an easement for the underground storage of gas which requires it to have a different measure of damages than the customary measure of damages for easement acquisition. It is difficult for us to see how a commercially valueless salt-water-filled sandstone formation 1600 feet below the surface and which is unusable by the defendants, can take on any added value by virtue of a possible special use unavailable to them. However, if defendants’ theory of damages is applicable, it should apply whether plaintiffs were seeking to condemn the whole (fee simple) of plaintiff’s property or just the easement, since the defendants’ theory is that the highest and best use of the property is specifically as a gas storage reservoir.
The evidence which defendants sought to introduce and the offers of proof made by defendants were based on the valuation of a successfully operating gas-storage field. Defendants offered the testimony of petroleum engineers who had prepared figures of the possible amount of gas which could be stored in the Mahomet field, assuming that it would be as capable as anticipated, and which showed that a reasonable development of the field would produce a future net revenue of $238,777,500 which was then discounted to obtain a present-day worth of $59,453,228 with the proportionate share of defendants’ farm evaluated at $413,616. Other witnesses offered by defendants were prepared to testify that the highest and best use of defendants’ land was for underground storage of natural gas and that the land for that purpose was worth $250,000 to $300,000 and, after the easement taking, it would be worth from $50,000 to $100,000, so that the damage to the defendants’ land was in the neighborhood of $200,000. The lower court rejected these offers of proof. The plaintiff introduced evidence of value by customary methods. As an adverse witness, George Buckles testified that the 160-acre farm was used in a grain and livestock operation, was improved with. usual farm buildings and that there had never been any oil or gas produced and that he knows of no oil or gas under the land. Plaintiff also presented the evidence of three expert real-estate appraisal witnesses who testified as to the value of the farm before the taking of the easement and the value after the easement, with a determinaton of $4000 as being the difference or the burden of the plaintiff’s easement. Two of the real-estate witnesses testified as to the sales of the fee of other tracts in the area during 1959, i960, and January of 1961, at prices ranging from $500 to $600 per acre, and some of these sales were after the seller became aware of the gas-storage possibilities. The defendants’ land was valued at $500 per acre.
While, as we have already noted, there are no specific decisions dealing with the condemnation of underground storage rights, there are some analogous situations in the water reservoir and hydro-electric power project cases. In United States ex rel. TVA v. Powelson,
We have also held that frustration of an anticipated return need not constitute a compensatory element in a condemnation case. Housing Authority of East St. Louis v. Kosydor,
In McGovern v. New York,
We recognize that there may be special cases where the property is exceptionally adapted and available for a particular use which should be taken into consideration in fixing the value. See: United States v. Chandler-Dunbar Water Power Co.,
Olson v. United States,
In this case defendants’ position relies on the “physical adaptability” of their land or what might be called the “strategic location” of their property. In United States v. Chandler-Dunbar Water Power Co.
Neither is there a “reasonable possibility” that the defendants could use their land together with the other lands necessary for a gas-storage field. Such a project not only depends on the putting together of some 5,000 acres, the minimum for the pilot operation of Mahomet, but also the obtaining of a certificate for the project from the Commerce Commission. The argument of defendants that other utilities had expressed interest in the availability of an underground storage area and, therefore, there is “marketability” to the under ground storage rights in the defendants’ 160 acres, is without merit. Before any utility could operate a gas-storage project an order granting a certificate of public convenience and necessity would be required even though no condemnation was involved. (Wilcox v. Commerce Com.
We do not consider City of Chicago v. Sexton,
Furthermore, at the very heart of defendants’ position is the fact that the St. Peter sandstone formation under the defendants’ land achieves value solely because it is a part of the certificated storage project of the plaintiff and, therefore, runs headlong into a well established rule in determining values, i.e., that no consideration is to be given to the value to the condemnor for some special use. (City of Chicago v. Harrison-Halsted Building Corp.
We are, therefore, of the opinion that defendants’ theory of value for their property was remote and speculative and the trial court was correct in rejecting the defendants’ offer of proof. Where the theory of value of the property is dependent on too many contingencies and is too uncertain, the trial court does not err in excluding such evidence. Chicago Land Clearance Com. v. Darrow,
Since the offered testimony was properly excluded, the only competent evidence submitted to the jury was that the fair cash market value of the easement burden was $25 per acre or $4,000. Consequently, the court properly directed a verdict in that amount. (City of Chicago in Trust for Schools v. Riley,
We, therefore, conclude that the judgment of the circuit court of Champaign County was correct and it is affirmed.
Judgment affirmed.
