Reporter's Statement of the Case

plies for vessels and as a base for the fishing fleets and for coastal naval operations of the Government, both during the late war and in times of peace. The Corinthian Yacht Club was located fronting on the harbor and adjoining the west side of Yale Avenue immediately adjacent to the portion of the property taken by the Government under the President's proclamation of December 2, 1918. This club had been practically closed prior to December 2, 1918.

XX. The Cape May Real Estate Company's development was divided into two major portions: "Plan A" and "Plan B." "Plan A" consisted of the portion of the property between Madison Avenue and Pittsburgh Avenue and extending from the Atlantic Ocean some 10 or 12 blocks to the northward. "Plan A" also included all of the land between Beach Avenue and New Jersey Avenue and halfway between New Jersey Avenue and New York Avenue for the entire distance eastward to Sewells Point. About December, 1918, all of the streets in "Plan A" had been actually opened, graded, and surfaced with gravel. Cement curbs and sidewalks had been constructed between Madison Avenue and Pittsburgh Avenue and throughout "Plan A" a large number of first-class cottages had been constructed. There was no water or sewerage installed in the requisitioned area save a small pipe constructed by the Government to the naval air station along Yale Avenue, and a similar pipe to Sewells Point. In the block between Pittsburgh Avenue and Baltimore Avenue, extending from Beach Avenue to New Jersey Avenue, there had been erected the new Cape May Hotel, a brick structure costing about $1,000,000. Along Beach Avenue for several blocks east of the hotel had been constructed a number of fine residences. Beach Avenue was a broad thoroughfare 102 feet in width extending along the Atlantic Ocean to Sewells Point. On the northerly side of it were constructed cement sidewalk and cement curbing, while on the ocean side it had a twenty-foot boardwalk, protected by a bulkhead, which extended to Sewells Point. New Jersey Avenue was likewise graded its entire distance and had a gravel surface as far eastward as California Avenue. The cross streets, running north and south, were graded and

Reporter's Statement of the Case

improved with cement curbs and sidewalks from Beach Avenue to New Jersey Avenue.

XXI. "Plan B" was the portion of the property outside of "Plan A." It was being made ready for sale, and prior to December 2, 1918, had been brought up to the established grade, with the exception of certain areas. The portion of "Plan B" east of Yale Avenue (in the commandeered area) had been completely filled with the exception of the two small areas designated as "Low Area No. 2" and "Low Area No. 4." The established grade at the middle line of the tract was between 12 and 13 feet above low water and sloping slightly toward the beach and toward the harbor to a point 8 feet above low water for purposes of drainage. The low areas No. 2 and No. 4 above mentioned would have required about 244,000 cubic yards to bring them to the established grade.

XXII. The western boundary of the tract included in the President's proclamation of December 2, 1918, was the westerly line of Yale Avenue. Yale Avenue was physically opened, graded, and surfaced with gravel throughout its entire length from Beach Avenue to the harbor. The cement curbs and sidewalks had been constructed. This avenue was the means of approach to the Corinthian Yacht Club which fronted on the harbor. The fence erected by the Government was located on the easterly line of Yale Avenue and the street was not in fact closed to public use. The whole of the bed of Yale Avenue, however, was within the lines of the commandeered tract.

XXIII. At Sewells Point had been erected a large casino or amusement pavilion adjacent to the harbor and the shore end of Cold Spring Inlet. This casino was destroyed by fire on July 4, 1918, and had not been rebuilt prior to December 2, 1918. At this point also was located by the city of Cape May a wharf or boat landing which was the terminus of a line of pleasure boats which operated between Sewells Point and Wildwood Crest, a near-by summer resort. This landing had served as a terminus for street cars which formerly ran to Sewells Point, but which line had not been operated since 1916.

Reporter's Statement of the Case

XXIV. An electric street railway, known as Cape May, Delaware Bay & Sewells Point Street Railway Company had, prior to 1917, operated a line of passenger cars from Cape May, partly along Beach Avenue to Madison Avenue, and thence along New Jersey Avenue to Sewells Point. During the period of the war, while the United States Government was in occupation under a nominal lease of the premises afterwards commandeered, the Government made use of the tracks and other facilities for the transportation of materials and supplies to the Government base at Sewells Point.

XXV. During the several years constituting the period of the World War market conditions affecting seashore developments were adverse. The city of Cape May was a more popular summer resort sixteen or eighteen years prior to the requisition than at the time of said requisition. There was only one residence on the requisitioned area, which was a stucco house, in a state of disrepair. Following the armistice in November of 1918 conditions for the development and marketing of seashore property became more favorable.

XXVI. The total holdings of the Cape May Real Estate Company within the lines of "Plan A" and "Plan B," and together with the accreted area of 33 acres and the riparian rights along the Atlantic Ocean frontage and the riparian rights along the harbor frontage, together with the bed of Yale Avenue, all within the commandeered area, as of December 2, 1918, were of the fair and reasonable market value in the aggregate of $365,500.

XXVII. The property of the Cape May Real Estate Company lying within the bounds and limitations of the tract of land described in the proclamation of the President, dated December 2, 1918 (No. 1504), as of the date of the commandeering by the United States was subject, inter alia, to the following encumbrances and liens:

(1) Mortgage deed of trust to the Colonial Trust Company, dated July 1st, 1907, and recorded in Bk. 180, folio 207, made to secure the issue of 3,500 bonds of $1,000.00 each. The same covers all the property of the said company on Plan A.

(2) Four mortgages to Nelson Z. Graves, dated and recorded as follows:

Reporter's Statement of the Case

(a) Dated February 21st, 1912, and recorded in Bk. 106, folio 146, amount $250,000.00, with interest at 6%..

(b) Dated January 8th, 1913, and recorded in Bk. 112, folio 320, for $75,000.00, with interest at 6%.

(c) Dated January 14th, 1913, and recorded in Bk. 120, folio 73, for $30,000.00, with interest at 6%.

(d) Dated February 14th, 1914, and recorded in Bk. 122, folio 472, for $25,000.00, with interest at 6%.

All of which said last-mentioned four mortgages are now vested in the Mutual Liquidating Company by virtue of an assignment of the same, dated August 12th, 1915, and recorded in Book of Assignment No. 16, folio 1.

(3) Judgment, Colonial Trust Company, Trustee, v. Cape May Real Estate Co. New Jersey Supreme Court, November term, 1910, page 289, amount $357,950.21, with interest at 6% and costs, dated December 29th, 1910, Judgment, vol. 5, page 174.

(4) Judgment, Peter Shields v. Cape May Real Estate Company. New Jersey Supreme Court, June term, 1917, folio 315; amount $62,083.50, with interest at 6% and costs, dated October 25th, 1917, Judgment, vol. 10, page 408. Now pending on rule to show cause why judgment should not be opened.

Assignment to Henry Darlington, jr., dated August 5th, 1918, and recorded in Book H of Assignments, page 598.

XXVIII. On June 25, 1907, a contract was executed by the Cape May Real Estate Company in the form appearing as Exhibit A to defendant's counterclaim, which is by reference made a part hereof. This document was not signed or executed by anyone on behalf of the United States. This document recites the appropriation of $311,000 for the improvement of Cold Spring Inlet by the act of Congress approved March 2, 1907 (Public, No. 168), and recites further that, in consideration of the expenditure of said appropriation in the improvement of Cold Spring Inlet, the company accepted the proviso of the said act of Congress, and further agreed to construct prior to September 30, 1909, by excavation or otherwise, immediately inshore of said Cold Spring Inlet and connected therewith, a harbor suitable for commerce, of which at least 400 acres shall have a depth

Reporter's Statement of the Case

of not less than thirty feet at mean low water. The time for performing this work was later extended to September 30,

1914.

XXIX. Before the time for finishing the harbor work was extended to September 30, 1914, the whole situation was reviewed in a letter from Major R. R. Raymond, in charge of the U. S. Engineers Corps for the Wilmington district, who, on May 17, 1911, sent to Mr. N. Z. Graves, the president of the Cape May Real Estate Company, a letter. This letter reads in part as follows:

"The question to be determined is, What work is necessary to make the present harbor available? About 250 acres of the basin is now dredged to 30 feet; the Government channel is to be 25 feet deep.

"To make the present harbor available, therefore, requires the dredging of the Government channel to twenty-five feet and the dredging of a channel connecting the Government channel with the basin. The dredging to be done at the expense of the Cape May Real Estate Company to accomplish this is about 1,360,000 cubic yards, which, at, say, 6 cents per yard, will cost $81,600."

XXX. The amount of dredging involved in excavating the area of 400 acres to a depth of thirty feet would be 19,360,000 cubic yards. The Cape May Real Estate Company actually excavated from the harbor a total of 19,785,580 cubic yards. This excess yardage was due to the fact that a portion of the harbor was dredged to a depth in excess of thirty feet, and to the further fact that part of the dredging was in an area outside of the 400 acres.

XXXI. When the dredging work was discontinued in April, 1913, there would have been required additional excavations of 3,900,000 cubic yards to bring the harbor to a continuous depth of thirty feet over an area of 400 acres. The channel or inlet between the jetties which, for the distance of a mile, formed the entrance to the harbor from the ocean was dredged by the Government to a depth of twenty-five feet, and there is no authorization or plan for any greater depth. The availability of the harbor for commerce would be limited by the depth of the entrance channel-twenty-five feet.