Opinion ID: 901858
Heading Depth: 1
Heading Rank: 3

Heading: The 1875 Right of Way Act

Text: [¶ 8.] We discussed the 1875 Act in Brown v. Northern Hills Regional Railroad Authority, 2007 SD 49, 732 N.W.2d 732. Beginning in the 1800s, Congress enacted several bills which explicitly granted public lands to railroad companies to aid the construction of a cross-country railroad. Barney [v. Burlington Northern R.R. Co.], 490 N.W.2d [726,] 729 [(SD 1992)] (citing Act of Sept. 20, 1850, 9 Stat. 466). Pursuant to these bills, Congress gave generous land grants from the public domain to the railroads to subsidize the costs of the western expansion. Id. The expansion stretched from the 100th meridian from the middle of Nebraska to California. Id. Because of mounting public criticism, the nature of the land grants changed in 1872. Id. [T]he House of Representatives enacted a resolution condemning its policy of outright land grant subsidies to railroads. Id. (citing Leo Sheep Co. v. United States, 440 U.S. 668, 99 S.Ct. 1403, 59 L.Ed.2d 677 (1979)). Instead, Congress began to reserve the land for homesteads and educational purposes. Id. Notwithstanding this changed policy, Congress continued to encourage the expansion of the West by enacting the 1875 Act, which authorized ROW [right of way] grants to railroads. Id. (citing 43 U.S.C. § 934). Id. ¶ 9. [¶ 9.] The United States issued land patents to homesteaders, passing title and ownership of certain public land to private individuals. Id. Some patents were issued subject to a railroad's right of way. Id. However, because the land patent at issue in Brown did not contain language indicating that the United States retained a reversionary interest in the right of way, we held that whatever interest the United States retained in the ROWs [rights of way] through the 1875 Act was relinquished when land patents were issued[.] Id. ¶ 22. The case was then remanded to determine whether the right of way had been abandoned. [¶ 10.] Here, CNW's predecessor in interest, FEMV, acquired a right of way interest in public lands under the 1875 Act. The United States also issued land patents to certain predecessors in interest of plaintiffs. [7] These land patents were subject to the railroad's right of way. But, like the land patents in Brown, the patents here do not reserve any interest in the Right of Way in the United States. Therefore, under Brown, if the Right of Way has been abandoned, plaintiffs are the fee owners as the heirs, successors, or assigns of the original property owners. See id. [¶ 11.] Plaintiffs contend that CNW abandoned the Right of Way in 1970, when it removed the railroad tracks and facilities and never again used the Right of Way for railroad purposes. NHRRA, on the other hand, insists that despite CNW's application for abandonment with the ICC, it could not legally abandon the Right of Way unless a specific Act of Congress would authorize such action. [8] NHRRA contends that 43 U.S.C. §§ 912, 913 require this specific Act of Congress. NHRRA insists these sections apply because 43 U.S.C. § 939 gave Congress the power to amend the 1875 Act. [9] [¶ 12.] In Brown, we rejected the notion that sections 912 or 913 apply when the United States issues a land patent without specifically reserving an interest in the right of way. 2007 SD 49, ¶ 22, 732 N.W.2d at 740. The facts of this case fit squarely within our holding in Brown; therefore, sections 912 and 913 do not apply in this case. Nevertheless, NHRRA maintains that no abandonment can occur because a railroad cannot alienate its property interest acquired by a congressional act. [10] We can find no authority to support NHRRA's assertion. Rather, based on our review of the caselaw, courts across the nation, both federal and state, have declared railroad rights of way abandoned despite the fact that the rights of way were acquired by a federal act. See Denver & R.G.R. Co. v. Mills, 222 F. 481, 486 (8th Cir.1915) (recognizing that a right of way granted to a railroad by Congress can be abandoned). Most recently, courts have held that a railroad right of way is abandoned when converted to a recreational trail. Ellamae Phillips Co. v. United States, 77 Fed.Cl. 387, 394 (2007), vacated on other grounds, 564 F.3d 1367 (Fed.Cir. 2009); see also Preseault v. Interstate Commerce Comm'n, 494 U.S. 1, 13, 110 S.Ct. 914, 922, 108 L.Ed.2d 1 (1990) (abandonment by converting right of way to a recreational trail); Hash v. United States ( Hash II ), 403 F.3d 1308, 1318 (Fed.Cir. 2005). [¶ 13.] Acknowledging that a right of way acquired by a congressional act can be abandoned, we must now determine what constitutes legal abandonment. South Dakota has not previously addressed the issue of abandonment of a railroad right of way. We note, however, that railroad rights of way implicate particularly unique property interests. [11] See Hanson Indus., Inc. v. County of Spokane, 114 Wash.App. 523, 58 P.3d 910, 914 (2002) (The chaos reflected in court decisions arises from the unique nature of railroad rights-of-way.). Thus, while our past cases discussing abandonment of easements might be instructive, we are particularly guided by the decisions of courts that have considered abandonment of railroad rights of way. [¶ 14.] In addressing abandonment of rights of way, courts have invoked common law abandonment principles. Chatham v. Blount County, 789 So.2d 235, 241 (Ala. 2001); Hinojos v. Lohmann, 182 P.3d 692, 701 (Colo.Ct.App.2008); Martell v. Stewart, 6 Kan.App.2d 387, 628 P.2d 1069, 1070-71 (1981); Washington Sec. and Inv. Corp. v. Horse Heaven Heights, Inc., 132 Wash.App. 188, 130 P.3d 880, 884-85 (2006). One court considered state-specific statutory abandonment law. Macerich Real Estate Co. v. City of Ames, 433 N.W.2d 726, 729 (Iowa 1988). And, depending on the circumstances, other courts have considered federal enactments, such as 43 U.S.C. §§ 912, 913. Marshall v. Chicago and Nw. Transp. Co., 31 F.3d 1028, 1032 (10th Cir.1994); Washington Securities and Inv. Corp., 130 P.3d at 885-86. [¶ 15.] Since at least 1920, railroad abandonment of rail line has been regulated by the Interstate Commerce Commission (ICC), which is now the Surface Transportation Board (STB). See 49 U.S.C. § 10903 (1995). While authorization from the ICC or other authority to abandon a rail corridor is indicative of the railroad's intent to abandon its right of way, the authorization is generally not conclusive evidence of abandonment. [12] See Schnabel v. DuPage County, 101 Ill. App.3d 553, 57 Ill.Dec. 121, 428 N.E.2d 671, 677 (1981) (citing Lake Merced Golf & Country Club v. Ocean Shore R.R. Co., 206 Cal.App.2d 421, 23 Cal.Rptr. 881 (1962); Faus v. Pacific Elec. Ry. Co., 146 Cal. App.2d 370, 303 P.2d 814 (1957); City Motel, Inc. v. State ex rel. State Dept. of Highways, 75 Nev. 137, 336 P.2d 375 (1959)); Michigan Dept. of Natural Res. v. Carmody-Lahti Real Estate, Inc., 472 Mich. 359, 699 N.W.2d 272, 287 (2005); In re Condemnation by County of Lancaster, 909 A.2d 913, 920 (Pa.Commw.Ct.2006); see also City of Aberdeen v. Chicago and N.W. Transp. Co., 602 F.Supp. 589, 591 (D.S.D.1984); but see Kansas City Area Transp. Auth. v. 4550 Main Assoc., Inc., 742 S.W.2d 182, 191 (Mo.Ct.App.1986) (An intention to abandon is inferred by the discontinuance of rail service with no prospect for resumption of service.). [¶ 16.] `[I]n order to establish that a railroad has abandoned its right-of-way easement, it is necessary to prove actual relinquishment and the intention to abandon the use of the premises.' Nat'l Wildlife Federation v. ICC, 850 F.2d 694, 703 (D.C.Cir.1988) (quoting Schnabel, 57 Ill.Dec. 121, 428 N.E.2d at 676); Martell, 628 P.2d at 1070. Intent to abandon can be inferred from the circumstances. Nat'l Wildlife Federation, 850 F.2d at 703. [M]ere non-use is probative of such intent but may not be sufficient in itself to demonstrate abandonment. Id.; see also Martell, 628 P.2d at 1071. Yet, when nonuse destroy[s] either the object for which the easement was established or the means of its enjoyment[,] abandonment is established. Schnabel, 57 Ill.Dec. 121, 428 N.E.2d at 676. [¶ 17.] Here, the stipulated facts show that in 1968, CNW issued a board resolution stating that the abandonment of the [rail] line will be advantageous to the economic and efficient overall operation of the company and said branch line is no longer necessary or expedient in the operation of such transportation system. The resolution directed that if authority was granted from the ICC for abandonment, the company was [a]uthorized to take such action as may be necessary or appropriate to consummate such abandonment in all respects; and the salvaging, sale or other disposition of said branch line and the materials, property, right-of-way and land incidental thereto, in whole or in one or more parts, for such consideration as shall be at least the substantial equivalent of the net salvage value thereof, and for the best prices obtainable for the right-of-way and land. [¶ 18.] In 1970, CNW filed an application for abandonment with the ICC. The application indicated that abandonment should be authorized because: (a) the major shipper on the line is presently relocating to Whitewood, South Dakota, and the remaining shippers on the line do not ship sufficient volume to warrant maintenance of the line which is extremely difficult to operate because of the significant grades and almost continuous curvature; (b) continued maintenance, reconstruction and rehabilitation of the line is not economically justified and would not be in the interest of the public or the Applicant; and (c) rehabilitation and continued maintenance of the line required for continued operations constitutes an undue burden on interstate commerce. The ICC issued CNW a certificate and order authorizing abandonment of the railroad. Thereafter, CNW removed its railroad tracks and facilities and abandonment was finalized. There has been no railroad service on the Right of Way since 1970. In 1972, CNW quitclaimed all interest and title in the Right of Way to the State of South Dakota. After a series of conveyances, NHRRA acquired its interest in the Right of Way in 2004 and 2006, from DOT, CNW's successor, Union Pacific Railroad Company, and Dakota, Minnesota & Eastern Railroad Corporation. [¶ 19.] Based on our review of the law governing railroad abandonments, we conclude that by filing an application with the ICC for a certificate of abandonment and asserting no intent to continue or resume use of the Right of Way, CNW exhibited its intent to abandon the Right of Way. When CNW entered into a contract with the State in 1970 to sell its interest in the Right of Way, CNW then made clear its intent to discontinue use of the property for easement purposes. Finally, by removing the tracks and facilities and actually selling its interest to the State, CNW sufficiently relinquished its rights to the easement to constitute abandonment. [¶ 20.] NHRRA, nonetheless, insists that the act of selling the property to the State is wholly inconsistent with relinquishment of the property and inimical to abandonment. [13] On the contrary, courts have consistently held that an attempt to convey or sell a right of way easement to others to be used for other purposes defeats the purpose of the easement and constitutes abandonment. [14] Chatham, 789 So.2d at 241; Cannco Contractors, Inc. v. Livingston, 282 Ark. 438, 669 S.W.2d 457, 459 (1984); Lake Merced Golf & Country Club, 23 Cal.Rptr. at 890-91; Mammoth Cave Nat'l Park Ass'n v. State Highway Comm'n, 261 Ky. 769, 88 S.W.2d 931, 935 (Ct.App.1935); Seventy-Ninth Street Improvement Corp. v. Ashley, 509 S.W.2d 121, 123 (Mo.1974); Marthens v. B & O R.R. Co., 170 W.Va. 33, 289 S.E.2d 706, 711-12 (1982); see also Buffalo Twp. v. Jones, 571 Pa. 637, 813 A.2d 659, 665-66 (2002) (no intent to abandon when railroad attempted to sell or convey because the railroad retained a right to reenter for future railroad use ). When CNW abandoned the Right of Way, the easement extinguished. The circuit court did not err when it quieted title in plaintiffs to the right of way property conveyed through the 1875 Act.