Last month, the Supreme Court of the United States (please, there is no such thing as the “United States Supreme Court”) decided a very interesting case about easements. “Easements?”, you ask. Yes, easements. We use them almost every day. Well, every weekend, perhaps. Greenways. Rails to trails. Beach access. You name it. Also, the case is interesting because it holds the Federal Government to a much older (1940-old, which is old) argument it made about easements, and which contradicts the Government’s argument in this recent case.
We’re talking today about Marvin M. Brandt Revocable Trust v. United States, No. 12-1173 (March 10, 2014).
In 1875, to encourage settlement of the West and to entice railroads to develop, Congress passed the General Railroad Right-of-Way Act, which granted to “any railroad” a “right of way through the public lands of the United States” to the “extent of 100 feet on each side of the central line” provided the railroad either (1) actually constructed its railroad or (2) filed a proposed map of its rail corridor. From that day forward, after the right of way is obtained, “all such lands over which such right of way shall pass shall be disposed of subject to the right of way”.
In 1908, pursuant to the Act, the Laramie[,] Hahn’s Peak & Pacific Railway Company obtained a 66-mile, 200-foot wide right of way through southern Wyoming. By 1911, the Railway had completed construction of its railroad over the Act-granted right of way.
In 1976, the United States patented an 83-acre parcel to the Brandt family, conveying fee simple title but reserving and excepting certain rights-of-way and easements “to the United States”. For purposes of our discussion today, we’ll focus on the reservation and exception that the land was patented “subject to those rights for railroad purposes as have been granted to the Laramie[,] Hahn’s Peak & Pacific Railway Company.” That right of way stretched for nearly 1/2-mile across the Brandt parcel, covering 10 of the 83 acres. As noted by the Court, “[t]he patent did not specify what would occur if the railroad abandoned this right of way”.
The rail line owning the right of way changed hands a number of times, ending with the Wyoming and Colorado Railroad. In 1996, the Railroad notified the Surface Transportation Board of its intention to abandon the right of way.
In 2006, the United States filed this lawsuit seeking a judicial declaration that the right of way had been abandoned and an order quieting title to the right of way in the United States. All property owners along the right of way settled or defaulted but for the Brandts, which took issue with the attempt to quiet title in the United States.
The Brandts contend that the “stretch of the right of way crossing [the Brandt] family’s land was a mere easement that was extinguished upon abandonment by the railroad, so that, under common law property rules, [the Brandts] enjoyed full title to the land without the burden of the easement”.
The United States “countered that it had all along retained a reversionary interest in the railroad right of way—that is, a future estate that would be restored to the United States if the railroad abandoned or forfeited its interest”. In this sense, the United States is arguing that the 1875 Act created something more than an easement, the latter working as the Brandts indicate. It is this “implied reversionary interest” in the United States that underlies the dispute.
The trial court granted summary judgment to the United States, and the appellate court affirmed. The Supreme Court granted certiorari, and reversed. In an 8-1 decision, the Court determined the Brandts held title to their 83 acres free and clear of the abandoned easement. The other landowners are SOL.
The Majority’s decision sits on two pillars: (1) the common law nature of easements and (2) an earlier argument from the United States’, on which the United States succeeded, that supports the Brandts’ position and contradicts the United States’ position in this lawsuit.
First, the common law nature of easements. Citing myriad secondary sources, the Court notes that an easement is a “nonpossessory right to enter and use land in the possession of another”, which “disappears” if the beneficiary “abandons” at which point “the landowner resumes his full and unencumbered interest in the land”. Thus, the railroad’s decision to abandon and ruling that it had abandoned “resume[d]” in the Brandts their patented interest in the property.
Second, the United States’ inconsistency. In what appears to be a point of order first raised before the Supreme Court — there is no mention of this at either the trial court or the appellate court level — the Court notes that the United States argued successfully in 1940, adopted by the Court “in full”, that the 1875 Act “clearly grants only an easement, and not a fee”. See Great Northern Railway Co. v. United States, 315 U.S. 262 (1942). Thus, the United States cannot now argue that the 1875 Act creates something more than an easement, with an implied reversionary interest in the United States after abandonment. Of course, if you’re the United States, there is likely nary an argument you haven’t made before.
The dissent takes the position that railroad rights of way have always been treated differently than ordinary easements, and rightfully so, as sui generis property rights not governed by the common law regime. In the context of railroad rights of way, the dissent points out, “traditional property terms like ‘fee’ and ‘easement’ do not neatly track common-law definitions” as the rights of way have characteristics of both easements and fee. The dissent insists that precedent, including the decision in Great Northern Railway, is clear that railroad rights of way were granted by the 1875 Act “with an implied possibility of reverter in the United States”.
And then the dissent gets real, which is our jam: “By changing course today [from prior precedent regarding railroad rights of way and implied reversionary interests in the United States], the Court undermines the legality of thousands of miles of former rights of way that the public now enjoys as means of transportation and recreation.” Yep, those trails, which had been rails, could likely fail.
Mike Thelen practices in Womble, Carlyle’s Real Estate Litigation and Land Use practice group. He regularly represents a wide variety of clients, from local governments to businesses, in land use and land development matters in both state and federal venues throughout North Carolina. Follow the North Carolina Land Use Litigator on Twitter at @nclanduselaw and “like” us on Facebook here.
Categories: Eminent Domain & Taking Issues