Filed:   September 7, 2000

                   UNITED STATES COURT OF APPEALS

                       FOR THE FOURTH CIRCUIT


                            No. 99-1117
                          (CA-93-990-AMD)



Washington Metropolitan Area Transit Authority,

                                                Plaintiff - Appellee,

          versus


Precision Small Engines, et al.,

                                   Parties in Interest - Appellants.



                             O R D E R



     The court amends its opinion filed June 19, 2000, as follows:

     On the cover sheet, section 1 -- the status is changed from

“UNPUBLISHED” to “PUBLISHED.”

     On page 2, section 1 -- the status line is corrected to read

“Affirmed by published per curiam opinion.”

     On page 2, section 3 -- the reference to use of unpublished

opinions as precedent is deleted.
                             - 2 -




     On page 4, fifth full paragraph, line 1 -- the paragraph is

corrected to begin “Arguing that the mezzanine in question is

personal property ....”

                                     For the Court - By Direction




                                     /s/ Patricia S. Connor
                                              Clerk
PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

WASHINGTON METROPOLITAN AREA
TRANSIT AUTHORITY,
Plaintiff-Appellee,

v.

PRECISION SMALL ENGINES; GREGORY
HNARAKIS; THOMAS STOKES,
Parties in Interest-Appellants,

and

                                                               No. 99-1117
ONE PARCEL OF LAND IN PRINCE
GEORGE'S COUNTY, MARYLAND;
HARRY S. KRAMER; BERNICE J.
KRAMER; UNKNOWN OWNERS;
WASHINGTON SUBURBAN SANITARY
COMMISSION,
Defendants,

TAMARA HNARAKIS; DOMINION BANK
OF MARYLAND,
Parties in Interest.

Appeal from the United States District Court
for the District of Maryland, at Baltimore.
Andre M. Davis, District Judge.
(CA-93-990-AMD)

Argued: April 6, 2000

Decided: June 19, 2000

Before LUTTIG and WILLIAMS, Circuit Judges, and
Gerald Bruce LEE, United States District Judge for the
Eastern District of Virginia, sitting by designation.

_________________________________________________________________
Affirmed by published per curiam opinion.

_________________________________________________________________

COUNSEL

ARGUED: David Danny Freishtat, SHULMAN, ROGERS, GAN-
DAL, PORDY & ECKER, P.A., Rockville, Maryland, for Appellants.
Kathryn E. Kovacs, Appellate Section, Environment & Natural
Resources Division, UNITED STATES DEPARTMENT OF JUS-
TICE, Washington, D.C., for Appellee. ON BRIEF: Lois J. Schiffer,
Assistant Attorney General, David C. Shilton, David Lastra, Appel-
late Section, Environment & Natural Resources Division, UNITED
STATES DEPARTMENT OF JUSTICE, Washington, D.C., for
Appellee.

_________________________________________________________________



_________________________________________________________________

OPINION

PER CURIAM:

Precision Small Engines, Inc. ("Precision") appeals the district
court's holding, in a one-day bench trial, that a disputed mezzanine
constructed by Precision was, for "taking" purposes, a fixture, right-
fully compensated to the owners of the property and not the tenant,
Precision. The district court held that, at the time of the condemnation
by Appellee Washington Metropolitan Area Transit Authority
("WMATA"), the mezzanine was affixed to the property in question
and, as a factual matter, was a part of the realty for which the landlord
received just compensation. We affirm.

I.

Precision sells and repairs small and medium size engines, lawn-
mowers, landscape machinery, snow plows, and generators. Gregory

                     2
Hnarakis, Tammy Hnarakis, and Thomas Stokes are the principals of
the company. WMATA is an interstate compact entity created with
Congressional consent as an instrumentality of the District of Colum-
bia, the State of Maryland, and the Commonwealth of Virginia. It is
empowered by its charter to exercise the power of eminent domain to
purchase real or personal property.

Until 1988, Precision leased 4820 and 4822 Lehigh Avenue in Col-
lege Park, Maryland from Harry and Bernice Kramer. When the com-
pany originally moved to this location, Mr. Hnarakis and Mr. Stokes
were aware that WMATA might take the property in the future.
Accordingly, when they built a wooden mezzanine for additional stor-
age space, they made it removable. In addition, because the walls at
this original location were plasterboard with aluminum studs, the
mezzanine could not be attached to the property.

Pursuant to its power of eminent domain, WMATA condemned
4820 and 4822 Lehigh Avenue in 1988. Precision, again leasing from
landlords Mr. and Mrs. Kramer, moved the mezzanine to a new loca-
tion at 4824 Lehigh Avenue, customizing it to fit the space.The mez-
zanine formed a second level of approximately 1,200 square feet in
the seventy-five foot deep warehouse and it was eight feet off the
ground. Since one of the walls in the new location was cinder block,
Precision was able to bolt the mezzanine to the wall using lag bolts.
It took several weeks to install the mezzanine and would have taken
approximately the same amount to dismantle and remove it. More-
over, extracting the lag bolts could have left more than thirty holes in
the wall. Precision never obtained permits to construct the mezzanine,
nor did it obtain the landlord's written permission to build it, as
required by the lease.

On January 13, 1993, the Kramers accepted WMATA's offer of
$1,166,000.00 for Parcel ME091, which included 4824 Lehigh Ave-
nue. Later that month, Precision was notified they would have to
move once again. This time, however, WMATA advised Precision
that the mezzanine would have to stay, and that WMATA would be
purchasing it as part of the Kramers' property. Accordingly,
WMATA filed the appropriate papers to take the property, including
the mezzanine, but refused to compensate Precision for the mezza-
nine.

                    3
Specifically, WMATA filed a Complaint for Condemnation, Dec-
laration of Taking, and Motion for Delivery of Possession in the
United States District Court for the District of Maryland on April 5,
1993. No answer was filed by Precision. Instead, on March 9, 1994,
almost a year later, Precision filed a "Counter Claim" alleging that the
mezzanine was a trade fixture and Precision's personal property.

On May 6, 1998, Precision filed a motion for partial summary
judgment, seeking a court order that the mezzanine taken by
WMATA was compensable to them. The district court denied this
motion without a hearing on September 11, 1998, holding that a dis-
pute of material fact as to whether the mezzanine was personalty or
realty precluded summary judgment.

The district judge heard the one-day non-jury bench trial on
December 18, 1998, and entered judgment in favor of WMATA on
December 21, 1998. Precision filed its notice of appeal on January 15,
1999.

II.

Whether personal property has been so attached to realty as to
become a fixture is a question of fact, and a lower court's finding is
upheld on appeal by this Court unless it is "clearly erroneous." See
Multi-Channel TV Cable Co. v. Charlottesville Quality Cable Corp.,

, 1121-22 (4th Cir. 1995). "A finding is `clearly errone-
ous' when although there is evidence to support it, the reviewing
court on the entire evidence is left with the definite and firm convic-
tion that a mistake has been committed." United States v. United
States Gypsum Co., 

, 395 (1948).

Arguing that the mezzanine in question is personal property and, as
such, compensable as part of Appellee's taking, Precision claims that
the government must compensate it for the value of the lumber and
other hardware which constituted the mezzanine.1 Accordingly, Preci-
sion submits that the district court erred in finding that the mezzanine
had the character of real property, despite the fact that the tenant con-
_________________________________________________________________

1 Alternatively, Precision contends that the "replacement value" of the
mezzanine would represent adequate compensation.

                    4
sidered it personalty. Precision contends further that WMATA wrong-
fully refused to place any value on the mezzanine.

Under Maryland law, a determination of whether an item is a fix-
ture requires the Court's consideration of the following factors: (1)
annexation to the realty, either actual or constructive; (2) adaptation
to the use of that part of the realty with which it is connected; and (3)
the intention of the party making the annexation to make the article
a permanent accession to the freehold (intention being inferred from
the nature of the article, the situation of the party making the annexa-
tion, the mode of annexation, and the purpose for which it was
annexed). See Schofer v. Hoffman, 

, 274 (1943).

With this legal backdrop, we conclude that the district court cor-
rectly found the mezzanine to be "absolutely affixed" to the property
as a "second floor." Precision's sole witness testified that he and his
partner bolted the mezzanine to the concrete block wall of the build-
ing and adjusted the mezzanine to fit the new location. The evidence
further suggests that removing the mezzanine would have required
dismantling the entire structure and would have left more than thirty
holes in the cinder block wall.

Precision's subjective intent in installing the mezzanine is not rele-
vant to the district court's ultimate determination. Cf. In re Sucesores
de Abarca, Inc. v. Gov't Dev. Bank for Puerto Rico, 

,
396 (1st Cir. 1988). Moreover, Precision's own evidence establishes
a basis for the conclusion that it intended to annex the mezzanine to
the property and that the district court's finding is not clearly errone-
ous.

First, the mezzanine could not be removed from the warehouse
without being dismantled. Second, Appellants' intent as to whether
the structure was a permanent installation must be considered in light
of their decision to bolt the mezzanine to the wall -- in contrast to
their earlier installation of the same mezzanine at a nearby location
where no such bolting was performed. Third, the requirement of dis-
mantling lends major credence to the district court's finding of the
mezzanine's permanence. Taken together, these determinations by the
district court mitigate against this Court's finding that the district
judge was clearly erroneous in classifying the mezzanine as realty.

                     5
III.

Regarding Precision's estoppel argument, this Court will not con-
sider issues raised for first time on appeal without exceptional circum-
stances of plain error or a fundamental miscarriage of justice. See
Muth v. United States, 

, 250 (4th Cir. 1993).

Here, Precision contends that WMATA was estopped to deny that
the mezzanine in question was personal property since WMATA had
previously assessed value to it when they paid Precision for the first
relocation. In support of this argument, Precision contends that the
doctrine of equitable estoppel may be asserted against the government
when it is acting in a proprietary manner. This is the situation here,
they claim, because the purchase of real estate was the function per-
formed by the government -- and such a function may be considered
"proprietary." See, e.g., The Falcon, 

, 1014 (D. Md.
1927). Precision also alleges that the "change in position" by
WMATA toward the status of the mezzanine is contrary to public pol-
icy.

As stated above, however, the general rule is that this Court will
not consider issues raised for the first time on appeal. Notably, Preci-
sion does not dispute that they failed to raise this issue at the district
court level. Because Precision did not evoke the issue of equitable
estoppel in the district court, it can not do so here.

Moreover, even if Precision's estoppel argument were properly
before this Court for review, it lacks merit because the operation of
estoppel against government entities is limited, see Office of Person-
nel Management v. Richmond, 

, 419 (1990), and Preci-
sion has failed to prove detrimental reliance on the government's
alleged misrepresentation. See generally United States v. Agubata, 

, 1083 (4th Cir. 1995).

IV.

Finally, the district court did not consider Precision's charge that
all of the allegations in its "Counter Claim" were admitted because
WMATA failed to file an answer to it. This Court declines to rule on

                     6
issues that were not addressed by the lower court. See Renn v. Garri-
son, 

, 352 (4th Cir. 1996).2

Consequently, the district court did not err by hearing all of Appel-
lee's contentions in this matter.

AFFIRMED
_________________________________________________________________

2 Even if Precision had properly preserved their argument on the
"Counter Claim," it would not prevail in this Court because the "Counter
Claim" was not a permissible pleading. Under Federal Rule of Civil Pro-
cedure ("FRCP") 71A(e), aside from contesting the amount of a compen-
sation award, any defense or objection not asserted in an answer is
waived. See Fed. R. Civ. P. 71A(e). Simply put, no other pleading
besides the answer is contemplated. See id.; see also Atlantic Seaboard
Corp. v. Van Sterkenburg, 

, 458 (4th Cir. 1963) ("One
pleading to raise all objections and defenses to the taking and one hear-
ing to dispose of them are contemplated, not successive pleadings and
successive hearings spanning a much longer period of time.").

Because Precision failed to file an answer altogether to WMATA's
notice of the taking, which was sent pursuant to FRCP 71A(d), it effec-
tively waived the substance of its "Counter Claim." In addition, the filing
of a "Counter Claim" almost one year after service of the original Com-
plaint is altogether untimely.

                    7