Howard v. United States

• Citation: 964 N.E.2d 779
• Decision Date: 20 March 2012
• Docket Number: No. 94S00–1106–CQ–333.,94S00–1106–CQ–333.
• Parties: Henry L. HOWARD, et al., Plaintiffs, v. UNITED STATES, Defendant.
• Court: Supreme Court of Indiana

964 N.E.2d 779

Henry L. HOWARD, et al., Plaintiffs,
v.
UNITED STATES, Defendant.

No. 94S00–1106–CQ–333.

Supreme Court of Indiana.

March 20, 2012.

[964 N.E.2d 780]

Brent W. Baldwin, J. Robert Sears, Baker Sterchi Cowden & Rice, L.L.C., St. Louis, MO, Bryan H. Babb, Alan S. Townsend, Bose McKinney & Evans LLP, Indianapolis, IN, Attorneys for Plaintiffs.

Ignacia S. Moreno, Assistant Attorney General, David C. Shilton, United States Department of Justice, Environment & Natural Resources Division, Washington, DC, Joseph H. Hogsett, United States Attorney, Southern District of Indiana, Shelese Woods, United States Attorneys Office, Indianapolis, IN, Attorneys for Defendant.

DICKSON, Justice.

The United States Court of Federal Claims has certified for our resolution the following question:

Under Indiana law, are railbanking and interim trail use pursuant to 16 U.S.C. § 1247(d) uses that are within the scope of the easements acquired by the railroad companies either by prescription, condemnation, or the deed at issue; and if either is not within the scope of the easements originally acquired, is railbanking with interim tr[ai]l use a shifting public use?

Pursuant to Indiana Appellate Rule 64, we accepted the question and now answer both parts in the negative. Under Indiana law, railbanking and interim trail use pursuant to 16 U.S.C. § 1247(d) are not uses within the scope of the easements, and railbanking with interim trail use does not constitute a permissible shifting public use.

The underlying suit is what is commonly referred to as a “Rails to Trails” case. See Consol. Rail Corp., Inc. v. Lewellen, 682 N.E.2d 779 (Ind.1997) (holding that railroad easements had been abandoned and thus could not be transferred to railroad corridor trails group). The question arises from a federal lawsuit brought by 128 Indiana landowners whose lands are burdened by railroad easements. Together these easements compose a railroad corridor approximately twenty-one miles in length. Because the rail lines are no longer in use, the railroad, pursuant to federal law, 49 U.S.C. § 10903, sought authorization from the Surface Transportation Board (“STB”) to abandon the easements. The STB authorized the railroad to negotiate transfer of the railroad corridor to the Indiana Trails Fund for use as a public trail (“interim trail use”) in accordance with the National Trails System Act (“Trails Act”), 16 U.S.C. § 1247. The Trails Act authorizes the STB to facilitate such transactions in order to “preserve established railroad rights-of-way for future reactivation,” Id. § 1247(d), a process frequently called “railbanking.”

The Court of Federal Claims certified this question to us in accordance with Preseault v. I.C.C., which upheld the constitutionality of the Trails Act but noted that “[s]tate law generally governs the disposition of reversionary interests” and that, “[b]y deeming interim trail use to be like discontinuance rather than abandonment, Congress prevented property interests from reverting under state law.” 494 U.S. 1, 8, 110 S.Ct. 914, 920, 108 L.Ed.2d 1, 11 (1990) (citation omitted). In her concurrence, Justice O'Connor stated, “Determining what interest petitioners would have enjoyed under [state] law, in the absence of the [Interstate Commerce Commission]'s recent actions, will establish whether petitioners possess the predicate property interest that must underlie any takings claim.” ¹

[964 N.E.2d 781]

Id. at 21, 110 S.Ct. at 926, 108 L.Ed.2d at 20 (O'Connor, J., concurring). The Court concluded that any remedy to which a landowner may be entitled must be secured through the provisions of the Tucker Act, 28 U.S.C. § 1491(a)(1). See Preseault, 494 U.S. at 11–17, 110 S.Ct. at 921–24, 108 L.Ed.2d at 13–17.

To determine whether railbanking and interim trail use pursuant to the Trails Act are permitted uses within the scope of the easements under Indiana law, we first consider Indiana law regarding the abandonment and the preservation of railroad rights-of-way. The General Assembly has specifically delineated when and how a railroad easement may be deemed abandoned. See Ind.Code §§ 32–23–11–6 to –8; Lewellen, 682 N.E.2d at 783 (“[T]he common law on whether abandonment [of railroad easements] has occurred was superseded by the General Assembly.”). One means of preserving the railroad easements is by converting it to a recreational trail under the Trails Act. Ind.Code § 32–23–11–7 (“A right-of-way is not considered abandoned if the [ICC] or [STB] imposes on the right-of-way a trail use condition under 16 U.S.C. § 1247(d).”). Accordingly, such rights-of-way may be “railbanked” indefinitely because such action does not abandon the easement but rather preserves it. This informs, but does not settle the first part of the certified question, which asks whether, under Indiana law, such Trails Act uses are within the scope of the easements acquired. This question—regarding the use of the railroad rights-of-way as public recreational trails—is governed by the Indiana common law on easements.

Indiana law with respect to the scope of easements ² is well settled. The extent of the easement interest is determined by the purpose served by the easement. New York Cent. R.R. Co. v. Yarian, 219 Ind. 477, 482–83, 39 N.E.2d 604, 606 (1942) (“It is sometimes said that reservations of easements are strictly limited to the purposes in the minds of the parties, but we believe a proper application of the rule puts the limitation not upon the character of traffic upon a reserved way, but upon the purpose to be served by the traffic.”); see also McCauley v. Harris, 928 N.E.2d 309, 314 (Ind.Ct.App.2010) (“It is well established that easements are limited to the purpose for which they are granted.”), trans. denied.

Usually, easements arise to fill some need or serve some purpose. That purpose, whether expressed in the grant, implied, or acquired through prescription, is the focal point in the relationship which exists between the titleholders of the dominant and servient estates. The servient estate is burdened to the extent necessary to accomplish the end for which the dominant estate was created. The titleholder of the dominant estate cannot subject the servient estate to extra burdens any more than the holder of the servient estate can materially impair or unreasonably interfere with the use of the easement.

[964 N.E.2d 782]

Klotz v. Horn, 558 N.E.2d 1096, 1099–1100 (Ind.1990) (citations omitted) (quoting Brown v. Heidersbach, 172 Ind.App. 434, 438, 360 N.E.2d 614, 618 (1977), reh'g denied, trans. denied ). And while this Court has had little occasion to apply these rules of late, these principles continue to have force today. See, e.g., Rehl v. Billetz, 963 N.E.2d 1, 6–7 (Ind.Ct.App.2012), pet. for reh'g pending; Kwolek v. Swickard, 944 N.E.2d 564, 571 (Ind.Ct.App.2011), trans. denied; McCauley, 928 N.E.2d at 314.

The fact that the majority of the easements at issue in this case were created by prescription or condemnation and not granted by deed ³ does not alter the analysis. The purpose of the adverse...