# U ni te d S ta te s Co ur t of A pp ea ls For the Eig hth Circu it

__ __ __ __ __ __ __ __ __ __ __ __ __ _
No. 1 4- 30 25

__ __ __ __ __ __ __ __ __ __ __ __ __ _ Qua li ty A g S erv ic e o f Io wa, In c.

ll ll ll ll ll ll ll ll ll ll l Pla in ti

ff - App el la nt

v.

Bu rli ng to n No rth ern an d S an ta Fe Rai lway; BNSF Ra il way Co m pa ny; Bu rli ng to n Nor th ern an d S an ta Fe Rai lway Com pa ny; Bu rli ng to n No rth ern Rai lro ad Co m pa ny

ll ll ll ll ll ll ll ll ll ll l Defe nd

an ts - App el le es

__ __ __ __ __ __ App eal fro m

Uni te d S ta te s Di st ric t Co ur t fo r th e So ut he rn Dis tri ct of I owa - Des M oi ne s

__ __ __ __ __ __
Su bm it te d: Sep te m

be r 22 , 20 15 Fil ed : Oct ob er 3 0, 2 01 5

__ __ __ __ __ __ Befo re MUR PHY, MELLOY, an d S MITH, Ci rcu it Ju dg es

.

__ __ __ __ __ __
MURP HY, Circ ui t J ud ge

.

Th e q u es ti on in th is ap pe al is whi ch pa rty own s a pa rti cu la r si de tra c k i n M e l r o s e , Io wa. The si de tra ck is ad jacen t to two rai lro ad tra ck s be lo ng in g to Bu rli ng to n Nor th ern San ta Fe Rai lway ("B NSF") an d al so to th e pr op ert y of Qua li ty Ag Se rv ic e o f Io wa ("Qu al it y Ag" ). Qua li ty Ag con te nd s t ha t i t o wns th e si de tra ck by m ean s of ad ve rs e po ss es si on du e to it s co nt in uo us po ss es si on of th e si de tra ck fro mAug us t 25 , 20 00 to Aug us t 2 5, 2 01 0. BNSF ha s st or ed eq ui pm en t on th e si de tra ck

si nc e o ne of i ts tra in s d erai le d n ear i t o n Au gu st 3, 2 01 0.

Qua li ty Ag al le ge s th at BNSF ha s br each ed an ag reem en t be twee n th e pa rti es

. BNSF's m ot io n fo r su m

m ary jud gm en t was gr an t e d by th e di st ric t co ur t aft er it 1

co nc lu de d t ha t t he ad ve rs e p os se ss io n c la im by Q ua li ty A g was in su ffi ci en tl y pl ed
, th at BNSF own s th e si de tra ck
, an d th at th e ag reem en t al le ge d by Qua li ty Ag la ck ed

c o n s i de rat io n. On Qua li ty Ag’s ap pe al we co nc lu de th at it s cl ai m of ad ve rs e
po ss es si on fai ls si nc e it di d no t ex cl us iv el y po ss es s th e si de tra ck fo r at le as t te n y ears

.

BNSF own s two rai lro ad tra ck s th at ru n th ro ug h Mel ro se , Io wa. In 19 94 it so ld

a p a rcel of la nd ad

jacen t to it s rai lro ad tra ck s in Mel ro se to Farm ers Co op e r a t i v e Ass oc ia ti on ("F arm ers Co op "). The sa le di d no t in cl ud e an ad joi ni ng si de tra ck us ed

to di ve rt rai lro ad tra ffi c of f th e m ai n tra ck s. Farm ers Co op so ld it s pa rcel to Qua li ty Ag on Au g u s t 25
, 20 00
, an d Qua li ty Ag ha s si nc e us ed th e si de tra ck to rece iv e fert il iz er de li ve rie s

. I t s p res id en t an d own er, Jo se ph Si nc la ir, te st ifi ed at hi s de po si ti on th at a rep res en ta ti ve of Farm ers Co op to ld hi m th at at th e ti m e of th e sa le th e pu rch as ed pr op ert y in cl ud ed th e si de tra ck

. Thu s, from Aug us t 25
, 20 00 un ti l at le as t 20 12
, it s pr es id en t as su m ed th at Qua li ty Ag own ed th e si de tra ck

. Si nc la ir al so
te st ifi ed th at sh or tl y

aft er Qu al it y

Ag’s p ur ch as e fro m

Farm ers Co op it en te red in to

an ag reem en t perm it ti ng BNSF t o u se th e si de tra ck if B NSF m ai nt ai ne d it

. Qua li ty Ag was un ab le to pro du ce t hi s al le ge d wri tt en ag reem en t.

O n A u g u s t 3, 20 10 a BNSF tra in de rai le d on e hu nd red y ard s eas t of th e si de tra ck

. Si nc e t he n th e rai lro ad ha s ke pt eq ui pm en t on th e si de tra ck
, pr ev en ti ng Qua li ty Ag fro m us in g th e tra ck

. As a res ul t fert il iz er de li ve rie s to Qua li ty Ag m us t be m ad e by tru ck a t in crea se d co st , an d Qua li ty Ag fil ed th is act io n ag ai ns t BNSF.

Th e Hon or ab le Jo hn A. Ja rv ey , Uni te d St at es Dis tri ct Co ur t Ju dg e f o r t h e 1 So ut he rn Dis tri ct of I owa

.
-2

-Co un t I, whi ch ha s si nc e be en di sm is se d, so ug ht da m ag es du e to in crea se d del iv ery

co st s an d pr op ert y da m ag e res ul ti ng fro m th e de rai lm en t. Co un t II al le ge s th at BNSF ha s fa il ed to m ai nt ai n t he si de tra ck in vi ol at io n o f it s co nt ract wit h Qu al it y Ag.

Alt ho ug h BNSF pr od uc ed a la nd su rv ey du rin g di sc ov ery whi ch sh ows it as th e

own er of th e si de tra ck
, Qua li ty Ag res po nd s th at it is th e own er be cau se of it s ad ve rs e
po ss es si on

. The di st ric t co ur t gr an te d su m m ary jud gm en t to BNSF on Co un t II. The

co ur t ru le d th at BNSF own ed th e si de tra ck an d th at Qua li ty Ag co ul d no t pr ev ai l on it s ad ve rs e po ss es si on th eo ry be cau se it ha d no t be en pl ed in it s co m pl ai nt

. The co ur t

a l s o co nc lu de d th at th e m ai nt en an ce ag reem en t la ck ed co ns id erat io n be cau se it si m pl y all owe d B NSF th e ri gh t t o u se it s o wn p ro pe rty. Q ua li ty A g a pp eal s.

W e rev ie w a di st ric t co ur t's gr an t of su m m ary jud gm en t de no vo , "v ie win g al l

ev id en ce an d d r a win g al l reas on ab le in fere nc es in fav or of th e no nm ov in g pa rty."
Jo ne s v. Fro st , 77 0 F.3 d 11 83
, 11 85 (8 th Ci r. 20 14 ). S u mm ary jud gm en t is
ap pr op ria te "wh en th ere is no ge nu in e di sp ut e of m at eri al fact an d th e pr ev ai li ng pa rty is en ti tl ed to jud gm en t as a m at te r of law." Id.

Qua li ty Ag arg ue s th at it own s th e si de tra ck pu rs ua nt to ad ve rs e po ss es si on an d th at th e di st ric t co ur t erre d in co nc lu di ng th at it ha d no t pr op erl y pl ed th at th eo ry

. W e

ne ed no t anal y ze whet he r Qua li ty Ag’s adv ers e po ss es si on cl ai m was pro pe rly pl ed be cau se it fai ls as a m at te r of la w. In or de r to ga in ti tl e by ad ve rs e po ss es si on , o ne "m us t es t a b li sh ho st il e, act ua l, op en , ex cl us iv e an d co nt in uo us po ss es si on , un de r a cl ai m of rig ht or co lo r of ti tl e, fo r at le as t te n y ears , by cl ear an d po si ti ve pr oo f." Carp en te r v. Ru pe rto , 31 5 N.W .2d 78 2, 78 4 (Io wa 19 82 ). The ex cl us iv e po ss es si on el em en t is no t m et if th e la nd own er an d th e po te nt ia l ad ve rs e po ss es so r bo th oc cu py th e la nd du rin g th at te n y ear pe rio d. Hue bn er v. Kub ers ki
, 38 7 N.W

. 2 d 1 4 4
, 14 7 ( I o w a Ct

. App

. 19 86 ). In or de r to pr ev ai l he re, Qua li ty Ag m us t pr ov e ad ve rs e
po ss es si on fo r t h e p e r i od be twee n Aug us t 25
, 20 00 an d Aug us t 25
, 20 10

. Si nc e

-3

-BNSF be ga n oc cu pyin g th e si de tra ck aft er th e de rai lm en t on Aug us t 3, 20 10
, Qua li ty

Ag ca nn ot est ab li sh it s ad ve rs e p os se ss io n c la im

.

The al le ge d m ai nt en an ce ag reem en t be twee n th e pa rti es m us t be su pp or te d by

co ns id erat io n req ui rin g ei th er a be ne fit to th e pr om is or or a de tri m en t to th e pr om is ee. See Mar ge so n v. Arti s, 77 6 N.W .2d 65 2, 65 5 (Io wa 20 09 ). Si nc e Qua li ty Ag ha s no t sh own th at it own s th e si de tra ck
, it s br each of co nt ract cl ai m al so fai ls

. The jud gm en t of th e d is tri ct co ur t i s af

fir m ed

.

__ __ __ __ __ __ __ __ __ __ __ __ __ __ __

-4

-