LOS ANGELES
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THURSDAY, MARCH 20, 2014
PERSPECTIVE
High court backs landowners in abandoned railway dispute
Debra J. Albin-Riley
I
n the escalating national feud over
former railroad rights of way, the
U.S. Supreme Court has sided
with landowners wrestling with the
government for ownership of property formerly used by rail operators.
The decision could influence Fifth
Amendment takings cases across the
country, including the burgeoning
number of cases involving “rails-totrails” litigation.
In Brandt v. U.S., 2014 DJDJAR
2853, the justices voted 8-1 in favor
of the Brandt family, who claimed the
right to unencumbered ownership of
the land underlying a former railroad
right of way. The March 10 decision
reversed rulings by the district court
and the 10th U.S. Circuit Court of Appeals and resolves the conflict in the
lower courts over this question: What
happens when a right of way granted
to a railroad by statute is later abandoned by the railroad? The Supreme
Court’s answer: The land goes to the
party owning that property underlying
the right of way, and does not automatically revert to the government.
In Brandt, a railroad obtained the
original right of way in 1908 by virtue
of the General Railroad Right-of-Way
Act of 1875 (1875 Act). The U.S. later conveyed 83 acres of land in Fox
Park, Wyo., to the Brandt family in
1976, including the land underlying
the railroad right of way. The conveyance to the Brandts was accomplished
by a land patent, which conveyed the
land in fee simple, but also stated that
the land was granted “subject to those
rights for the railroad purposes….”
The land patent did not specify what
would happen if the railroad abandoned the right of way.
The last railroad to hold the right
of way, the Wyoming and Colorado
Railroad, sought to abandon the right
of way after an attempt to turn the unused railroad line into a tourist attraction failed. In 1996 the Wyoming and
Colorado notified the Surface Transportation Board of its intent to abandon the right of way. The tracks and
ties were removed and abandonment
was completed in 2004. But the story
did not end here, because the U.S. initiated an action seeking a judicial declaration of abandonment and an order
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quieting title to the abandoned right
of way to the U.S. The government
based its claim on the premise that it
had retained a reversionary interest in
the railroad right of way, which vested
in the U.S. upon the railroad’s abandonment.
The 1875 act and other statutes
like it tell the evolving story of our
country’s history through the use
of American railroads.
Marvin Brandt contested the government’s claim and filed a counterclaim, claiming the portion of the right
of way running over his family’s land
was only an easement, and terminated
when the railroad abandoned the right
of way. Thus, Brandt claimed, like any
easement, upon its extinguishment
occasioned by the railroad’s abandonment, his clan enjoyed full and unencumbered title to the land.
Addressing the government’s claim
that the 1875 act granted the railroad
something more than an easement that
gave the U.S. a reversionary interest
in that “additional” property interest,
the Supreme Court cited to its decision in Great Northern Railway Co.
v. United States, 315 U.S. 262 (1942),
issued more than 70 years ago. In that
case, the railroad holding a right of
way conferred by the 1875 act sought
to drill for oil beneath the right of
way. The government sued to enjoin
the oil drilling, claiming the railroad
had only an easement and the govern-
ment retained all interests underlying
the easement. In the Great Northern
case, the Supreme Court sided with
the government, finding that the 1875
act “grants only an easement, and not
a fee.” In so holding, the court seized
upon that portion of the 1875 act that
decreed “all such lands over which
such right of way shall pass shall be
disposed of subject to such right of
way.”
In the Brandt case, the court noted the patent conveying the Fox Park
land in 1976 gave the Brandt family
fee simple title to the land, only encumbered by the easement held by
the railroad in its right of way over
the land. Applying common law principles of property law, the court reasoned that when the railroad enjoying
the easement abandoned it, the easement ceased to exist. Upon the easement’s extinguishment, the Brandts
owned the same unfettered right to the
land under the former right of way as
they held to the rest of the Fox Park
property.
The 1875 act and other statutes like
it tell the evolving story of our country’s history through the use of American railroads. The Brandt decision recounts part of the story: The 1875 act
was one of a series of statutes enacted
to facilitate transcontinental railroads
during the mid-to-late 19th century.
To accomplish that goal, Congress
passed several laws giving railroads
“rights of way” over vast stretches of
public lands throughout the country.
But times change, and so has our
nation’s use of railroads. In the later
part of the 20th century, the national problem of declining rail use led
Congress to enact laws seeking to
preserve railroad lines not currently in use for possible future use, by
converting those lines to recreational
trails. This “rails-to-trails” conversion
activity can be subject to the Fifth
Amendment takings clause. When
the government takes private property, it must provide just compensation;
however, whether or not a rails-totrails conversion amounts to a taking
can turn on the nature of the property
interest held — by the private landowner and the railroad — in the right
of way and the underlying land at the
time of the taking.
Several landowners across the nation currently seek redress in the U.S.
Court of Claims for governmental
takings in rails-to-trails cases. Since
the government’s liability to pay just
compensation to a private landowner
can depend on the nature of the property right acquired, the deeds at issue
(often recorded in the late 19th or early 20th century) often require close
scrutiny. And these archaic deeds,
like the 1875 act, frequently feature
the words “across” or “over” the land
or “subject to” the railroad’s right of
way. Although state law governs property rights determinations and laws of
the property’s locale apply, the Brandt
decision offers litigants some guidance as to whether a property interest
given long ago to a railroad is a fee
simple interest or “only” an easement.
As the Brandt court confirmed, we
have a “special need for certainty and
predictability where land titles are
concerned.” The decision advances
the battle for those American property
owners continuing to grapple with the
government over land rights where
trains did, but no longer run.
Debra J. Albin-Riley is a partner in the Complex
Litigation Practice
Group of Arent Fox
LLP in Los Angeles
and San Francisco.
She has tried several
complex commerDEBRA J. ALBIN-RILEY cial, health care and
Arent Fox
rails-to-trails cases.
Reprinted with permission from the Daily Journal. ©2014 Daily Journal Corporation. All rights reserved. Reprinted by ReprintPros 949-702-5390.