Court Opinion

ID: 185233
Source: CourtListenerOpinion
Date Created: 2011-02-05 02:29:17+00
Date Added: 2024-06-11T17:26:14.149860
License: Public Domain

222 F.3d 990 (D.C. Cir. 2000)
City of Philadelphia, Appelleev.Consolidated Rail Corporation, AppelleeNational Railroad Passenger Corporation, Appellant
No. 97-7221 to 97-7223
United States Court of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued January 11, 1999Decided July 7, 2000

Appeals from the United States District Court for the District of Columbia(Nos. 96rr00001, 96rr00003)
Dennis M. Moore argued the cause for appellant National  Railroad Passenger Corporation.  With him on the briefs  were J. Brian Molloy and John L. Moore, Jr.
Joann  Hyle argued the cause for appellant Consolidated  Rail Corporation.  With her on the briefs were Laurence Z.  Shiekman and Stacey A. Mufson.  Stephanie L. Kralik entered an appearance.
Kenneth A. Murphy argued the cause for appellee City of  Philadelphia.  With him on the brief was Gaetan J. Alfano.
Susan D. Colwell argued the cause and filed the brief for  appellee Pennsylvania Public Utility Commission.  John F.  Povilaitis entered an appearance.
Before:  Silberman, Sentelle and Garland, Circuit Judges.
Opinion for the Court filed by Circuit Judge Sentelle.
Sentelle, Circuit Judge:

1
Consolidated Rail Corporation  and National Railroad Passenger Corporation appeal from a  summary judgment entered against them in favor of the City  of Philadelphia and the Pennsylvania Public Utility Commission requiring the railroads to pay for the refurbishment of a  highway bridge.  Because the question of ownership of the  bridge was a matter governed by the state law of Pennsylvania, we certified that question to the Supreme Court of  Pennsylvania.  That court having now ruled that the City of  Philadelphia owns the bridge, we reverse the judgment of the  District Court and remand the case for the entry of summary  judgment in favor of the railroads.

Analysis

2
This case originated in the District Court for the District of  Columbia sitting as a Special Court under the Regional Rail Reorganization Act of 1973, 45 U.S.C. § 719 (1994).  The case  is a contest between the City of Philadelphia ("the City") and  the Pennsylvania Public Utility Commission ("PUC") on one  side, and Consolidated Rail Corporation ("Conrail") and National Railroad Passenger Corporation ("Amtrak") on the  other, over who owns a highway bridge over a below-grade railroad right-of-way, who has to pay for its repair and  upkeep, and in what amount.  The railroads appeal the  District Court's grant of summary judgment against Conrail  and Amtrak and in favor of the City and the PUC, in which  the railroads were required to pay for the refurbishment of a  highway bridge as its owners and as successors to the now defunct Pennsylvania Railroad and its successor, the also  defunct Penn Central Transportation Company ("Penn Central") under a contract with the City in which the railroad  promised to maintain the bridge at no cost to the City.  The  dispositive issue in the case is the ownership of the bridge  under Pennsylvania law.  If the Pennsylvania Railroad, the  original builder, never owned the bridge, but merely was a  party with a contractual maintenance obligation, then the  bridge did not pass to the railroads when the properties of  Pennsylvania Railroad's successor Penn Central passed to  Conrail and Amtrak under the provisions of the Regional Rail  Reorganization Act of 1973.  The parties offer Pennsylvania  authority both for the proposition that highway bridges are  parts of the highway they carry, and that they are appurtenances to the property they cross.  No one provides, nor have  we located, any case from Pennsylvania directly considering  what effect the ordinance between the City and the railroad  and the allocation of maintenance obligations in perpetuity  may have on the question of ownership in the first instance.

A. Jurisdiction

3
This action was originally filed in the Special Court under  45 U.S.C. § 719(e) (1994).  The Special Court was abolished  by Congress effective January 17, 1997, and its original  jurisdiction was transferred to the United States District  Court for the District of Columbia.  See 45 U.S.C. § 719(b)(2)  (Supp. III 1997).  We have jurisdiction of this appeal under  45 U.S.C. § 719(e) (Supp. III 1997) and 28 U.S.C. §§ 1291  and 1294 (1994).

B. Material Facts of the Case

4
The basic facts material to this issue are not disputed.  The  bridge in question crosses six railway tracks in the railroad  right of way at 41st Street in Philadelphia.  The City owns the bridges over 40th Street and 42nd Street, but maintains that  the railroads own the 41st Street bridge.  The 41st Street  bridge crosses six railway tracks, four owned by Amtrak and  two owned by Conrail.  The original steel and timber bridge  elevating 41st Street where it intersects with the railroad  right of way was built at the site in 1875.  That bridge was  replaced by the now-deteriorating steel and concrete structure which was built in 1929, pursuant to a Philadelphia city  ordinance that required the Pennsylvania Railroad to build  and maintain the bridge at its own cost under the supervision  of the Philadelphia Department of Public Works.  The Pennsylvania Railroad1 signed a document accepting these requirements on May 11, 1927.  The Pennsylvania Public Service  Commission (which became the PUC) issued a Certificate of  Public Convenience for construction of the highway bridge on  February 21, 1928, and Penn Central completed construction  in August of 1929.  None of these documents mentions ownership of the bridge.

5
It appears that the Pennsylvania Railroad and its successor  Penn Central lived up to this contractual obligation until  financial crisis struck the rail industry in the northeast,  threatening its extinction.  By 1971, Penn Central had filed  for bankruptcy. It was not alone.  By the early 1970s, the  railroads in the northeast were failing at such a rapid rate  that Congress stepped in to resolve the regional rail crisis. Congress passed the Regional Rail Reorganization Act of  1973, Pub. L. No. 93-236, 87 Stat. 985 (1974) (codified as  amended at 45 U.S.C. § 701 et seq. (1994)) (the "Rail Act"),  which allowed the railroads to reorganize into a single entity,  and Conrail was designed to salvage the viable rail properties,  leaving much of the debt behind in bankruptcy and beginning  with a "clean slate."  The process by which new, financially viable railroads were built from the wreckage that was the  northeastern rail system forms the essential legal background  to this case.  See generally Regional Rail Reorganization  Act Cases, 419 U.S. 102, 108-17 (1974).

6
The Rail Act created the United States Railway Association, see 45 U.S.C. § 711(a), a non-profit corporation, which in  turn prepared a Final System Plan ("FSP") which designated  how rail properties held by the bankrupt railroads would be  distributed, see 45 U.S.C. § 716.  The Rail Act also created  Conrail, see 45 U.S.C. § 741(a), and mandated that rail properties designated in the FSP be conveyed to Conrail, see 45  U.S.C. § 743(b).  The conveyance process was supervised by  the Special Court and implemented through a Conveyance  Order of the Special Court.  See 45 U.S.C. § 719(b).  Properties related to passenger rail service were then reconveyed to  Amtrak.  The transfer that matters in this case occurred  when, pursuant to the Rail Act, all of Penn Central's "rail  properties," i.e. properties "used or useful in rail transportation service," 45 U.S.C. § 702(14), were conveyed to Conrail,  and the property related to passenger rail service was reconveyed to Amtrak.  The City and the PUC claim that Penn  Central's trustees in bankruptcy conveyed all of the real  property in Philadelphia County to Conrail, "including the  railroad right of way, rails, and the 41st Street Bridge formerly owned by [the Pennsylvania Railroad]."

7
The railroads dispute that the bridge was ever owned by  Penn Central, and thus dispute that it could ever have been  properly conveyed to them.  They characterize the Rail Act  conveyances differently.  According to the railroads, the  deeds between the trustees of the Penn Central bankruptcy  estate and Conrail, and between Conrail and Amtrak, conveyed the real property free and clear of liens and encumbrances.  The six railroad tracks under the 41st Street bridge  were conveyed to Conrail, and four of them were reconveyed  to Amtrak.  Real property was conveyed by deed, and other  property was conveyed by Bills of Sale and Assignment,  which specifically excluded contracts for the "rehabilitation  and modernization" of property without complete financial  remuneration of the new railroads.  Contracts for the "maintenance and security" of property not passed to Conrail also  were expressly not conveyed.

8
The railroads denied any ownership interest in the bridge,  and opposed attempts by the City to have them maintain the bridge.  The bridge continued to deteriorate to the point that  it was closed to vehicular traffic in 1993, and only pedestrians  were allowed across.  The City notified the PUC of the  deteriorated condition of the bridge, and the PUC approved  the closure. (To the extent not preempted by federal law, the  PUC has regulatory authority over bridges crossing railroad  rights of way under Pennsylvania law, and may permit  changes or construction, and determine who must pay for  maintenance.)  The PUC began an investigation to determine  who was responsible for the repair and future maintenance of  the bridge.  The PUC directed Amtrak to create a plan for  repairing the bridge, and ordered the City to pay the initial  costs of repair.

9
The current case was initiated by the City in the Special  Court asking for a declaration that the responsibility to  maintain the 41st Street bridge had been conveyed to Amtrak  and Conrail by the Special Court's order transferring PennCentral's property.  Conrail then brought a related action  against the PUC, seeking to bind it to any order issued by the  Special Court.  The two cases were consolidated.  On simultaneous motions for summary judgment, the Special Court  held that the real property under the 41st Street bridge and  the bridge itself had been owned by Penn Central and had  been conveyed to Conrail and Amtrak, and that the contractual obligation to maintain the bridge under the 1927 agreement  had also been conveyed.  The Special Court further held that  while Conrail and Amtrak were not responsible for any  deterioration that took place prior to April 1, 1976 under the  Rail Act's "fresh start policy," the deterioration had substantially occurred after that date.  It held Conrail and Amtrak  responsible for all of the costs associated with repair and  maintenance of the bridge, and apportioned two-thirds to  Amtrak and one-third to Conrail, according to the number of  rail lines each owned.  The Court also stated that Amtrak's  obligation was not a tax or fee, but a contractual obligation.It did not address Amtrak's defenses that the action under  the contract was barred by the statute of limitations or  discharged in the Penn Central bankruptcy proceeding.

C. The Certification

10
Because this case presented a question that will likely rise  again in the context of litigation over the so-called "orphan  bridges" to which neither the railroads nor the municipalities  claim title, and because state law governing ownership of the  bridge is dispositive of the question of contractual allocation  of maintenance agreements, we concluded that an authoritative response to the question would assist in establishing  uniformity in future proceedings.  We further concluded that  the precise effect of the ordinance contracts on questions of  bridge ownership is purely a question of state law.  We  therefore petitioned the Supreme Court of Pennsylvania for  certification of the question of state law under 204 Pa. Code  § 29.451 (1999).  The Pennsylvania Supreme Court helpfully  granted our petition, and has now decided the certified question.

11
Based on the undisputed facts, that court held that it "has  long been recognized as the law in Pennsylvania" that "where  a railroad company has constructed at its own expense a  bridge over its tracks at a street crossing, and the bridge is to  constitute part of a public highway and be maintained by the  municipality, title to the bridge rests in the municipality."City of Philadelphia v. Consolidated Rail Corp., 560 Pa. 587, 747 A.2d 352, 354 (2000)  (citing Pennsylvania R.R. v. Greensburg, J. & P. Street Ry.,  176 Pa. 559, 575, 35 A. 122, 129 (1896)).  As further authority,  the Supreme Court cited North Pennsylvania Railroad Co. v.  Inland Traction Co., 205 Pa. 579, 587-89, 55 A. 774, 775-76  (1903), which held that a "railroad lacked standing to object to  proposed use by streetcars of a highway bridge that it  constructed over its right-of-way, inasmuch as the bridge  became part of the public highway, and the railroad thus had  no property interest that would be affected."  Consolidated  Rail, 747 A.2d at 354.  The court further recognized as a longestablished principle "that a bridge carrying a public street is  deemed to be a part of the street, and, as such, it is owned by  the entity that owns the street."  Id. (citing Heinlein v.  Allegheny County, 374 Pa. 496, 499, 98 A.2d 36, 38 (1953)).As it is "undisputed that the City owns the public street that is supported by the 41st Street bridge," it has owned the  bridge since the completion of its reconstruction in 1929.2

Conclusion

12
The Pennsylvania Supreme Court having decided the governing question of state law that the City and not the  railroads owns the bridge, and the railroads having been  absolved of contractual liability by the bankruptcies and the  Reorganization Act, we reverse the decision of the District  Court granting summary judgment in favor of the City and  the PUC and remand the case for the entry of summary  judgment in favor of the railroads.

Notes:

1
 The Pennsylvania Railroad, through merger, became the Penn  Central Transportation Company.

2
 On June 19, 2000, the Supreme Court of Pennsylvania issued an  order denying the City's application for reconsideration.