Court Opinion

ID: 6112107
Source: CourtListenerOpinion
Date Created: 2022-01-24 21:02:34.081495+00
Date Added: 2024-06-11T08:54:22.071853
License: Public Domain

Case: 21-1445   Document: 36   Page: 1   Filed: 01/20/2022

   United States Court of Appeals
       for the Federal Circuit
                ______________________

     GEORGE ANDERSON, AUDREY BABLES,
   CHRISTOPHER DONAL, ESTES ET UX, ADELE
  MARY GADLIN, MICHAEL HOLLEMAN, REGINA
     HOLLEMAN, SHERRY DIANE BRANDON
     HOLLOMAN, RALPH DAVID HOLLOMAN,
  ROBERT MOORE KING, DORIS J. KING, TERESA
    MAYS, LESTER MCDOWELL, MARIA ROSA
    MENDOZA, JUNIOR MORGAN, GINA GAIL
  MOSLEY, DINNA ANNETTA PATTON, MICHAEL
    PATTON, ERIC J. POWERS, TANYA RENEE
  RIGSBY, NKA TANYA GRAVES, W S SPEARMAN,
  DAVID SMITH, LYDIA C. WEAVER, CHARLES E.
  WILSON, APALA D. WILSON, KATIE G. WRIGHT,
  ESTATE OF JUSTO & CLAR BELTRAN, EUNICE
                   JACKSON,
               Plaintiffs-Appellants

 JAVIER SANCHEZ, VALENTINA SANCHEZ, LOVIE
          LEE STANLEY, DOE NO. 3,
                  Plaintiffs

                          v.

                  UNITED STATES,
                  Defendant-Appellee
                ______________________

                      2021-1445
                ______________________
Case: 21-1445     Document: 36      Page: 2    Filed: 01/20/2022

 2                                              ANDERSON   v. US

    Appeal from the United States Court of Federal Claims
 in No. 1:17-cv-00668-MMS, Senior Judge Margaret M.
 Sweeney.
                 ______________________

                 Decided: January 20, 2022
                  ______________________

    JOHN ROBERT SEARS, Baker, Sterchi, Cowden & Rice
 LLC, St. Louis, MO, argued for plaintiffs-appellants.

     JEFFREY AARON HALL, Environment and Natural Re-
 sources Division, United States Department of Justice
 Washington, DC, argued for defendant-appellee. Also rep-
 resented by ERIKA KRANZ, JEAN E. WILLIAMS.
                  ______________________

      Before PROST, REYNA, and STOLL, Circuit Judges.
 REYNA, Circuit Judge.
      In this rails-to-trails case, the United States Court of
 Federal Claims interpreted multiple real property deeds
 and determined that the property owners conveyed fee sim-
 ple interests, not easements, to a railroad. The Court of
 Federal Claims granted summary judgment for Appellee,
 the United States, upon determining that no takings from
 the landowners occurred when the government later au-
 thorized conversion of the railroad line to a recreation trail.
 We hold that the granting clauses of the subject deeds un-
 ambiguously conveyed fee simple interests in the land and
 not easements despite contradictory language elsewhere in
 the deeds. We affirm the judgment of the Court of Federal
 Claims.
                         BACKGROUND
     The Surface Transportation Board (“STB”) has exclu-
 sive jurisdiction to regulate the discontinuance or abandon-
 ment of nearly every railroad in the United States. See
Case: 21-1445       Document: 36   Page: 3    Filed: 01/20/2022

 ANDERSON   v. US                                            3

 49 U.S.C. § 10501(b). The STB is tasked with, among other
 things, enforcing the National Trails System Act (the
 “Trails Act”). See 16 U.S.C. §§ 1241, et seq.
     In 1983, Congress amended the Trails Act by adding a
 process known as “railbanking.” See 16 U.S.C. § 1247(d).
 In general, railbanking involves the transition of unused
 railroad corridors into recreational hiking and biking
 trails—a process commonly referred to as “rails to trails.”
 Like a discontinuance or abandonment, railbanking is sub-
 ject to authorization by the STB, and the STB retains ju-
 risdiction over the railroad line. See Preseault v. Interstate
 Com. Comm’n, 494 U.S. 1, 6–7 (1990).
      Generally, railbanking involves a transfer of interest in
 the use of a rail corridor to a third-party entity. See
 16 U.S.C. § 1247(d). This transfer of interest can consti-
 tute a taking depending on the nature of the property in-
 terest held by the railroads. See Preseault v. United States,
 100 F.3d 1525, 1552 (Fed. Cir. 1996). If a railroad initially
 was granted only a limited-use easement over the corridor,
 then a taking may occur when the STB authorizes the
 third-party entity to make use of the corridor for recrea-
 tional purposes. Id. If the railroad initially was granted a
 fee simple interest, the railbanking may result in no taking
 because “there is no owner of a separate underlying prop-
 erty interest to claim the rights of the servient estate
 holder.” Id.
                     PROCEDURAL HISTORY
      Plaintiffs-Appellants (the “Landowners”) 1 own parcels
 of land adjacent to a 2.45-mile strip of a railroad line (the

     1  The Landowners in this action are George Ander-
 son, Audrey Bables, Christopher Donal Estes Et Ux, Adele
 Mary Gadlin, Michael Holleman, Regina Holleman, Sherry
 Diane Brandon Holloman, Ralph David Holloman, Robert
 Moore King, Doris J. King, Teresa Mays, Lester McDowell,
Case: 21-1445    Document: 36     Page: 4   Filed: 01/20/2022

 4                                           ANDERSON   v. US

 “Line”) in McLennan County, Texas, which is owned by Un-
 ion Pacific Railroad Company. See J.A. 41. Union Pacific’s
 predecessor in interest, Texas Central Railroad Company
 (“Texas Central”), originally acquired the Line in 1902
 through a series of transactions, including multiple deeds
 executed by the Landowners’ predecessors in interest.
 Three of those deeds are at issue in this appeal: (1) the
 Falkner Deed, (2) the Brown Deed, and (3) the George
 Deed. J.A. 82–93.
     In February 2019, the Landowners filed an amended
 complaint in the United States Court of Federal Claims
 (“Court of Federal Claims”), alleging takings of real prop-
 erty interests caused by the STB’s authorization of rail-
 banking of the Line. J.A. 4. The Landowners sought
 compensation based on a theory that their predecessors in
 interest had conferred only easements to Texas Central in
 the century-old deeds. Id.
     The parties agree that all three deeds at issue on ap-
 peal contain the same operative language. By way of ex-
 ample, the Falkner Deed was executed in March 1902 and
 provides in relevant part:
     That we C. Falkner and wife Emma J. Falkner . . .
     do grant, bargain, sell and convey unto the said
     Texas Central Railroad Company all that piece or
     parcel of land, situate, lying and being in the
     County of McLennan, State of Texas, and described
     as follows:

 Maria Rosa Mendoza, Junior Morgan, Gina Gail Mosley,
 Dinna Annetta Patton, Michael Patton, Eric J. Powers,
 Tanya Renee Rigsby n/k/a Tanya Graves, W S Spearman,
 David Smith, Lydia C. Weaver, Charles E. Wilson, Apala
 D. Wilson, Katie G. Wright, the Estate of Justo & Clar Bel-
 tran, and Eunice Jackson.
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 ANDERSON   v. US                                            5

    Being a strip of land 75 feet in width . . . [detailed
    description of land]. This conveyance is made to
    the Texas Central Railroad Company for a right of
    way over and upon which the said railroad com-
    pany is to construct and operate and maintain its
    said railroad as the same is now located and estab-
    lished over and upon the above described tracts of
    land. And the right to take and use all stone earth
    and other material existing or that may be found
    within the right of way is hereby granted.
 J.A. 82–85 (emphases added).
     The Court of Federal Claims interpreted the deeds as
 having granting clauses (the first paragraph reproduced
 above) that conveyed fee simple estates, not easements.
 Anderson v. United States, 147 Fed. Cl. 661, 676–79, 681
 (2020). The Court of Federal Claims explained that under
 Texas law, the granting clause controls if it is not ambigu-
 ous, despite other language in the deed(s) referring to the
 conveyance as a right of way. Id. at 677 (citing Tex. Elec.
 Ry. Co. v. Neale, 252 S.W.2d 451, 453 (Tex. 1952)). The
 Court of Federal Claims concluded that because the grant-
 ing clauses at issue unambiguously conveyed fee simple in-
 terests, summary judgment in favor of the government was
 proper as to all claims based on the Falkner, Brown, and
 George deeds.
     The Landowners appeal. We have jurisdiction pursu-
 ant to 28 U.S.C. § 1295(a)(3).
                     STANDARD OF REVIEW
     We review the Court of Federal Claims’s legal conclu-
 sions de novo and its factual findings for clear error. Ca-
 sitas Mun. Water Dist. v. United States, 708 F.3d 1340,
 1351 (Fed. Cir. 2013) (citing Estate of Hage v. United
 States, 687 F.3d 1281, 1285 (Fed. Cir. 2012)). Accordingly,
 we review a grant of summary judgment by the Court of
 Federal Claims de novo. FastShip, LLC v. United States,
Case: 21-1445    Document: 36      Page: 6    Filed: 01/20/2022

 6                                            ANDERSON   v. US

 892 F.3d 1298, 1302 (Fed. Cir. 2018). Summary judgment
 is appropriate where the movant shows that there is no
 genuine dispute as to any material fact, and that the mo-
 vant is entitled to judgment as a matter of law. Id.;
 RCFC 56(a). We view the facts supported by evidence, as
 well as all inferences drawn therefrom, in the light most
 favorable to the non-moving party. United States v.
 Diebold, Inc., 369 U.S. 654, 655 (1962).
      Whether a taking occurred is a legal question based on
 factual underpinnings. Chi. Coating Co., LLC v. United
 States, 892 F.3d 1164, 1169 (Fed. Cir. 2018) (quoting
 Stearns Co. v. United States, 396 F.3d 1354, 1357 (Fed. Cir.
 2005)). In a takings case, determining the scope of a com-
 pensable property interest is a question of law. Casitas,
 708 F.3d at 1351 (citing Tex. State Bank v. United States,
 423 F.3d 1370, 1378 (Fed. Cir. 2005)). Relevant here,
 whether a specific deed conveys a fee simple interest or an
 easement is a question of law that we review de novo under
 the law of the state in which the property interest arises,
 here the State of Texas. Chi. Coating, 892 F.3d at 1169–70
 (citing Bd. of Regents v. Roth, 408 U.S. 564, 577 (1972)).
     In Texas, the standard of review applied to summary
 judgment in a deed construction case “is tied directly to
 whether the deed is clear on its face.” BNSF Ry. Co. v.
 Chevron Midcontinent, L.P., 528 S.W.3d 124, 128 (Tex.
 App. 2017). An unambiguous deed is reviewed de novo,
 looking only to the four corners of the document and em-
 ploying the usual canons of textual construction. Id. (citing
 Clayton Williams Energy, Inc. v. BMT O & G TX, L.P.,
 473 S.W.3d 341, 348 (Tex. App. 2015)). Interpretation of
 an ambiguous deed, i.e., a deed with two or more reasona-
 ble interpretations, presents a mixed question of law and
 fact, as a court may consider parol evidence regarding in-
 tent. Id. That said, “[a] deed is not ambiguous merely be-
 cause certain provisions of the deed conflict or appear to be
 internally inconsistent.” Id.
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 ANDERSON   v. US                                           7

                          DISCUSSION
      The Landowners concede that they would not have any
 interests remaining in the corridor if fee simple interests
 were conveyed under the subject deeds. See Appellants’
 Br. 2. Indeed, “[i]f the railroad company owns the land in
 fee simple, then the Government cannot have committed a
 taking and the analysis ends.” Chi. Coating, 892 F.3d
 at 1170 (citing Preseault, 100 F.3d at 1533). Therefore, we
 first review whether the Falkner, Brown, and George deeds
 conveyed fee simple interests.
     We agree with the Court of Federal Claims that Texas
 Electric Railway Co. v. Neale, 252 S.W.2d 451 (Tex. 1952),
 is controlling in this action. The deed in Neale contained
 the following language:
    (1) Know All Men By These Presents: That We . . .
    do by these presents grant, sell and convey . . . the
    following described piece or parcel of land, to-wit:
    (2) [detailed description of land]
    (3) It being the intention of this deed to convey a
    strip of land 100 feet wide for 550 feet, and 80 feet
    wide for the balance of the way through the prop-
    erty of J J Dean in the Tomas de la Vega Eleven
    League Grant.
    (4) It is further understood herein that the above
    strip of land is conveyed upon the further condition
    and consideration that said Southern Traction
    Company will, as soon as it begins operation, estab-
    lish a stop on the right of way hereinabove conveyed
    about the center thereof for the purpose of letting
    passengers on and off its cars which stop shall be
    as near a street crossing as possible and said Co.,
    shall forever keep up and maintain said stop when
    so established, and said company further agrees to
    allow to be opened and dedicated as streets across
    said right of way such streets as may be opened by
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 8                                             ANDERSON   v. US

     grantors herein, it being understood that the prop-
     erty through which this right of way is given is to
     be opened up as an addition to the city of Waco,
     ...
     (6) However, this deed is made as a right-of-way
     deed for an Interurban Railway from Dallas to
     Waco, Texas, and in case said railway shall not be
     constructed over said land then this conveyance
     shall be of no effect.
 Neale, 252 S.W.2d at 452–53 (emphases added).
     Faced with conflicting language in the Neale deed, the
 Texas Supreme Court examined Texas case law and artic-
 ulated the following rules for interpreting such deeds:
     First . . . a deed which by the terms of the granting
     clause grants, sells and conveys to the grantee a
     “right of way” in or over a tract of land conveys only
     an easement; and second . . . a deed which in the
     granting clause grants, sells and conveys a tract or
     strip of land conveys the title in fee, even though in
     a subsequent clause or paragraph of the deed the
     land conveyed is referred to as a right of way.
 Id. at 453 (emphasis added) (citing Right of Way Oil Co. v.
 Gladys City Oil, Gas & Mfg. Co., 157 S.W. 737 (Tex. 1913)
 (easement conveyed where granting clause recited: “I . . .
 have and do hereby grant . . . for the purpose of construct-
 ing, operating and maintaining its railroad, the right of
 way, two hundred feet in width, over and upon the above-
 described tract of land” (emphasis added)); Calcasieu Lum-
 ber Co. v. Harris, 13 S.W. 453 (Tex. 1890) (fee simple inter-
 est conveyed where granting clause recited “a strip of land”
 even though deed later referred to the land as a “right-of-
 way”); Brightwell v. Int’l-Great N. R.R. Co., 49 S.W.3d 437
 (Tex. 1932) (fee simple interest conveyed where granting
 clause recited “a strip of (200) Two Hundred feet in width
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 ANDERSON   v. US                                            9

 of land” even though deed later referred to a “right of
 way”)).
     Here, the granting clause in the Falkner deed reads:
 “[W]e C. Falkner and wife Emma J. Falkner . . . grant, bar-
 gain, sell and convey unto the said Texas Central Railroad
 Company all that piece or parcel of land, situate, lying and
 being in the County of McLennan, State of Texas, and de-
 scribed as follows: . . . .” J.A. 82–85 (emphasis added). As
 in Neale, this granting clause unambiguously conveys a
 piece or parcel of land, not an easement right of way. Well-
 settled Texas law instructs that the granting clause con-
 trols, even if the deed later refers to the conveyed land as a
 right of way. Neale, 252 S.W.2d at 453. As the Texas Su-
 preme Court stated in 1932, and again in 1952, this rule
 “has become a rule of property under which titles and se-
 curities of immense value have been acquired in [Texas],
 and it should not now be disturbed or changed.” Id. at 455
 (quoting Brightwell, 49 S.W.2d at 439).
     The Landowners argue that we should follow the more-
 recent ruling in BNSF Railway Co. v. Chevron Midconti-
 nent, L.P., 528 S.W.3d 124, 128 (Tex. App. 2017), instead of
 Neale. Appellant’s Br. 12–16. However, the BNSF deci-
 sion is distinguishable from both Neale and the present ac-
 tion. In BNSF, the granting clause at issue conveyed “unto
 the said party . . . and unto its successors and assigns, for
 a right of way, that certain strip of land hereinafter de-
 scribed, as the same has been finally located over, through
 or across the following tracts of land . . . .” 528 S.W.3d
 at 130. The BNSF court noted that “the language in the
 granting clause d[id] not clearly convey only a strip of land,
 but rather straddle[d] the line between the two different
 types of deeds, blending elements of both together.” Id.
 Thus, Neale was not dispositive in BNSF because the
 granting clause at issue in BNSF was ambiguous. Id.
 at 135. BNSF does not help the Landowners in this action
 because the granting clauses of the Falkner, Brown, and
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 10                                           ANDERSON   v. US

 George deeds clearly convey only a piece or parcel of land;
 they are not ambiguous like the granting clause in BNSF.
     The Landowners also contend that the deeds conveyed
 easements because they also granted the right to take nat-
 ural resources, such as stone, timber, earth, and other ma-
 terials, from the land, a grant that would have been
 superfluous if the land was conveyed in fee simple. Appel-
 lant’s Br. 17–19. This argument, however, was settled by
 Calcasieu Lumber, Brightwell, and Neale. The deeds at is-
 sue in those cases also contained similar grants of the right
 to take materials from the land. See Neale, 252 S.W.2d
 at 455 (acknowledging that the deeds in Calcasieu Lumber
 and Brightwell also conveyed the right to take materials
 from the land). Regardless, “[u]nder Neale, the unambigu-
 ous granting clause would knock out any contradictory lan-
 guage repugnant to that conveyance, which would mean
 reading the natural resource right allocation as being a re-
 dundancy.” BNSF, 528 S.W.3d at 133 & n.8 (explaining
 that the conveyed right to take and use “all of the wood,
 water, stone, timber and other material on said strip of
 land” was relevant there only because the deed in BNSF
 did “not have an unambiguous granting clause”). Here, the
 unambiguous granting clause knocks out as redundant the
 subsequent language in the deeds that contradict the fee
 simple conveyance. We therefore hold that the granting
 clauses of the deeds at issue unambiguously conveyed fee
 simple interests and not easements despite the presence of
 contradictory language elsewhere in the deeds.
                        CONCLUSION
    The Falkner, Brown, and George deeds conveyed fee
 simple interests and not easements. Accordingly, we
Case: 21-1445        Document: 36   Page: 11   Filed: 01/20/2022

 ANDERSON    v. US                                         11

 affirm the summary judgment granted by the Court of Fed-
 eral Claims in favor of the appellee.
                           AFFIRMED
                              COSTS
 No costs.