Caquelin v. United States

• Decision Date: 06 November 2018
• Docket Number: No. 14-37L,14-37L
• Parties: NORMA CAQUELIN, Plaintiff, v. UNITED STATES, Defendant.
• Court: U.S. Claims Court

NORMA CAQUELIN, Plaintiff, v. UNITED STATES, Defendant.

No. 14-37L

United States Court of Federal Claims

November 6, 2018

Post-trial decision on remand in a rails-to-trails takings case; liability for a temporary taking arising upon issuance of a NITU by the Surface Transportation Board

Thomas S. Stewart, Stewart, Wald & McCulley LLC, Kansas City, Missouri, for plaintiff. With him at the trial and on the briefs was Elizabeth McCulley, Stewart, Wald & McCulley LLC, Kansas City, Missouri. Also with him on the briefs were Steven M. Wald of Stewart, Wald & McCulley LLC, St. Louis, Missouri, and J. Robert Sears, of Baker Sterchi Cowden & Rice, L.L.C., St. Louis, Missouri.

Kristine S. Tardiff, Trial Attorney, Natural Resources Section, Environmental and Natural Resources Division, United States Department of Justice, Concord, New Hampshire for defendant. With her on the briefs was Jeffrey H. Wood, Acting Assistant Attorney General, Environmental and Natural Resources Division, United States Department of Justice, Washington, D.C.

OPINION AND ORDER

LETTOW, Senior Judge.

This rails-to-trails takings case is before the court after a trial held on remand from the United States Court of Appeals for the Federal Circuit. The remand directed the court to develop a factual record bearing on the government's contention that a set of precedents in the court of appeals should be overruled. See Caquelin v. United States, 697 Fed. Appx. 1016 (Fed. Cir. 2017) ("Caquelin II"), vacating 121 Fed. Cl. 658 (2015) ("Caquelin I"). The government had argued on appeal that a recent decision of the Supreme Court, Arkansas Game & Fish Comm'n v. United States, 568 U.S. 23 (2012), had undercut prior decisions by the Federal Circuit (and, indeed, the Supreme Court) relating to the analysis of takings claims in the rails-to-trails context. See Caquelin II, 697 Fed. Appx. at 1019 ("[E]n banc review may be warranted" because the "Arkansas Game decision does raise questions about Ladd [v. United States, 630 F.3d 1015 (Fed. Cir. 2010)]," and other earlier rails-to-trails decisions by the court of appeals.).

The case has its genesis in a Notice of Interim Trail Use ("NITU") issued by the federal Surface Transportation Board ("STB"), which authorized conversion of a portion of a railroad line located in Hardin and Franklin Counties, Iowa and its attendant right-of-way into a public recreational trail pursuant to Section 208 of the National Trails System Act Amendments of 1983, Pub. L. No. 98-11, § 208, 97 Stat. 42, 98 ("Trails Act") (codified at 16 U.S.C. § 1247(d)).¹ Plaintiffs, Kenneth Caquelin, now deceased,² and his wife, Norma Caquelin, owned two parcels of land adjacent to and under the railroad right-of-way on the date of the STB's action.³ For one parcel, the predecessor railroad had acquired its interest by a right of way deed, and for the other parcel, the railroad had acquired its rights by condemnation. Stip. ¶ 1; Caquelin I, 121 Fed. Cl. at 660. The successor railroad held easements limited to railroad purposes that were exceeded by issuance of the NITU, rendering the government liable for taking plaintiffs' property without just compensation under the Fifth Amendment. See, e.g., Preseault I, 494 U.S. at 12-13 (holding that the Tucker Act, 28 U.S.C. § 1491(a), provided a remedy for an alleged taking of a propertyinterest in land previously used as a railroad right-of-way that had been transferred to a public entity for use as a public trail).⁴

FACTS⁵

The parties' dispute concerns a 10.46-mile strip of land extending from milepost 201.46 near Ackley, Iowa, to milepost 191.0, outside Geneva, Iowa, upon which the North Central Railway Association, Inc. ("North Central Railway") previously acquired easements for railway purposes through a series of mesne conveyances. Caquelin I, 121 Fed. Cl. at 660. A railroad had been constructed by the Eldora Railroad and Coal Company in 1866 from approximately one mile north of Eldora, Iowa, to Ackley, Iowa for the purpose of transporting coal from the Coal Bank Hill area in the Iowa River valley near Eldora⁶ to a connection at Ackley with an east-west railroad, then known as the Dubuque & Sioux City Railroad, which later became part of the Illinois Central Railroad. Stip. Ex. 11 at STB000023. Between 1868 and 1870, the line was extended north to Northwood, Iowa, and south to Marshalltown, Iowa, where it connected with the Chicago & North Western Railroad. Id. A predecessor extending the rail line, the Central Railroad of Iowa,⁷ acquired rights in one of the parcels at issue by a right-of-way deed, see Caquelin I, 121 Fed. Cl. at 660 (citing Pls.' Mem. in Support of Mot. for Partial Summ. Judgment on Liability ("Pls.' Mot."), at 13 & Exs. A-2 (Maps of the Line) & J (Right of Way Deed by Henry and Maria Ihde to Central Railroad of Iowa (filed Apr. 30, 1870)), and rights to the second parcel by a condemnation, see id. (citing Pls.' Mot. at Ex. K (Latham Condemnation, Franklin County, Iowa (witnessed Aug. 31, 1870))). North Central Railway acquired property rights in the rail corridor in 1989. See United States' Cross-Mot. for Summ. Judgment & Mem. in Support, and Opp'n to Pls.' Mot. for Partial Summ. Judgment on Liability ("Def.'s Cross-Mot.") at 2-3, ECF No. 18. The rail corridor traverses a rural area of fertile agricultural land. See id. at 2; see also Stip. Ex. 6 (Franklin County Assessor's map of parcels). Indeed, the segment of the rail corridor at issue in this case is comprised of Klinger silty clay loam andDinsdale silty clay loam (designated soil types 184 and 337B, respectively), DX22, which both have a very high Corn Suitability Rating ("CSR") of 95, DX 11; see also Tr. 246:20 to 248:5.⁸

Ms. Caquelin is a resident of Cedar Falls, Iowa, who acquired the two parcels, numbered 1219200016 and 1219200001, in Franklin County, Iowa, through inheritance from her grandparents. Stip. ¶¶ 2-5 & Ex. 6 (map of parcels).⁹ Plaintiff alleges that under Iowa law, she gained fee title up to the centerline of the rail corridor in question. Compl. ¶ 4; see also Pl.'s Mot. at 1-2, Exs. G (Warranty Deed (May 11, 2007)), H (Summary of Parcels (Jan. 15, 2015)), & I (Map of Parcels); Hr'g Tr. 5:21-25 (May 14, 2015).

On May 13, 2013, North Central Railway filed a Proposed Abandonment with the STB,¹⁰ including a verified notice of exemption pursuant to 49 C.F.R. § 1152.50, seeking to abandon the railroad line on the grounds that "no local traffic [or overhead] has moved over the [l]ine for at least two years." Stip. Ex. 11 at STB000006, STB000009 (Notice of Exemption-Abandonment Exemption (May 9, 2013)).¹¹ Under STB's regulations, the abandonment exception for therailroad line was scheduled to become effective July 5, 2013. See Stip. Ex. 11 at STB000074-75 (STB Notice (June 5, 2013)).

Shortly before the abandonment exception became effective, on June 24, 2013, the City of Ackley and the Iowa National Heritage Foundation (collectively "the City") filed a request for issuance of a Public Use Condition under 49 U.S.C. § 10905 and a NITU under the Trails Act. See Stip. ¶ 12.a & Ex. 11 at STB000066 (Pet. for Recons. (filed June 21, 2013 and entered June 24, 2013)); Hr'g Tr. 6:4-11 (May 14, 2015) (noting that "the railroad initially applied purely for abandonment").¹² Several days later, on June 27, 2013, a letter from North Central Railway was entered with the STB indicating its agreement with the requested public use condition and related restrictions and its willingness to negotiate with the Iowa Trails Council regarding acquisition of the railroad line. See Stip. ¶ 12.c; see also Stip. Ex. 11 at STB000073 (Letter to Chief, Section of Administration, Office of Proceedings, STB from Counsel for North Central Railway (filed June 24, 2013 and entered June 27, 2013)). On July 3, 2013, STB accordingly issued a NITU for the railroad line. Stip. Ex. 11 at STB000077 (STB Decision and Notice of Interim Trail Use or Abandonment (July 3, 2013)).¹³ The NITU provided a 180-day period during which the railroad could negotiate with the potential trail group regarding "railbanking and interim trail use" of the corridor. Id. at STB000080. After the 180-day period, absent an extension, the NITU would expire by its own terms, at which point the railroad would be authorized to abandon the line. See id. at STB000081.

On October 15, 2013, the Iowa Trails Council filed a Trail Use Request with the STB, and negotiations over a Trail Use Agreement ensued, contemplating that the rail corridor would be used as a public recreational trail with railbanking for possible future activation as a railroad. See Caquelin I, 121 Fed. Cl. at 662.¹⁴ No agreement was reached, however. On December 6, 2013, the Iowa National Heritage Foundation requested a 180-day extension to continue negotiations, see Stip. Ex. 11 at STB000082 (Letter to Cynthia T. Brown, STB, from President, Iowa Natural Heritage Foundation (Dec. 6, 2013)), but North Central Railway did not file a letter indicating its consent, and on December 30, 2013, the NITU expired, see id.; see also Hr'g Tr. 12:7-15, 29:22 to 30:4 (May 14, 2015). On March 31, 2014, the railroad consummated abandonment of its line and the STB's regulatory jurisdiction ended. Stip. ¶ 12.f & Ex. 11 at STB000085 (STB Decision (May 9, 2014)). On April 24, 2014, North Central Railway notified the STB that it had exercised the authority to fully abandon the line. Id. ¶ 12.f & Ex. 11 at STB000084 (Notice of Consummation (Apr. 24, 2014)).

On January 16, 2014, Mr. and Mrs. Caquelin filed suit in this court. Their complaint alleged an uncompensated taking of their property in contravention of the Fifth Amendment. Specifically, plaintiffs argued that cessation of railroad activities across the burdened property effected an abandonment under Iowa law of the railroad-purposes easement, leading to a taking when the STB forestalled plaintiffs from regaining use and possession of their property. Compl. ¶¶ 7-9. Plaintiffs averred the...