Sunday, July 11, 2010

Placing a Value on Things

One of my favorite law jokes concerns a fifth grade class where each of the kids has to get up and describe what a parent does for a living.

Little Sammie gets up and says, "My dad is a social worker who is the boss at a company which cares for mentally challenged people!"

Little Susie gets up and says, "My mommy is a stewardess for US Airways -- she flies to Europe and South America and other places!"

Little Johnnie, whose father is a trial lawyer, gets up and says, "My dad says that he is a piano player in a whorehouse!"

The federal government, several decades ago, was confronted with a special problem when buying-up private land in Idaho to establish the federally-owned Clearwater River National Forest there. Exercising eminent domain, federal appraisers would visit privately-held lands, private residences, and private businesses, and put a price on it which they believed comprised fair market value for the property, and then arrange to have it paid.

At a remote place called Maggie's Bend, Idaho, they discovered that Maggie's Bend was actually a whorehouse, a perfectly legal business in Idaho back then.

Federal appraisers were struck dumb. How to put a value on such a property and business? Sample the goods themselves? Hunt down reguilar customers and interview them?

In his wonderful book, "Strange Encounters: Adventures of a Renegade Naturalist," author Daniel B. Botkin reveals that appraisers and owner shook hands on the concept of counting the number of towels coming down from upstairs to be laundered each month, and assigning a dollar value to each towel.

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