Kees v. N. States Power Co.

• Decision Date: 14 May 2013
• Docket Number: No. 2012AP424.,2012AP424.
• Citation: 348 Wis.2d 762,2013 WI App 84,833 N.W.2d 872
• Parties: Robert KEES and Helen Kees, Plaintiffs–Appellants, v. NORTHERN STATES POWER COMPANY, a/k/a Xcel Energy, Inc. and Chippewa Valley Motor Car Association Ltd., Defendants–Respondents.
• Court: Wisconsin Court of Appeals

348 Wis.2d 762
833 N.W.2d 872
2013 WI App 84

Robert KEES and Helen Kees, Plaintiffs–Appellants,
v.
NORTHERN STATES POWER COMPANY, a/k/a Xcel Energy, Inc. and Chippewa Valley Motor Car Association Ltd., Defendants–Respondents.

No. 2012AP424.

Court of Appeals of Wisconsin.

May 14, 2013.

Appeal from a judgment of the circuit court for Pepin County: Thomas E. Lister, Judge. Affirmed.
Before HOOVER, P.J., MANGERSON, J., and THOMAS CANE, Reserve Judge.¶ 1PER CURIAM.

Robert and Helen Kees appeal a judgment granting Northern States Power Company fee title to a strip of land on which a railroad was constructed in 1882. They contend the land was granted for railroad purposes by the federal government in the 1850s, and they are entitled to exercise a reversionary interest in the property because it was abandoned in the late 1970s. They also argue, in the alternative, that they have adversely possessed the land. We reject these arguments and affirm.

BACKGROUND

¶ 2 The Chippewa Valley and Superior Railway Company (“Superior Railway”) constructed a railroad in western Wisconsin in 1882. It passed through Pepin County and over certain sections of land now owned by the Keeses. The Keeses obtained their interest in the property under a 1995 land contract.¹ The disputed portion of the railroad, which is essentially a 100–foot–wide strip of land, has become known as “the Railway.”

¶ 3 In 1881, the Railway was owned by various individuals and entities. Between 1881 and 1882, they each conveyed to Superior Railway fee title to their portion of the 100–foot–strip.² The Railway was then acquired by various companies until it eventually wound up in the hands of an entity the parties call “Milwaukee Road.”

¶ 4 Milwaukee Road used the Railway as a railroad until sometime in 1977 or 1978. Milwaukee Road then filed for bankruptcy, and the Railway was sold during those proceedings to Northern States. Neither Northern States nor its successors in interest have removed the railroad tracks. In 1995, Northern States agreed to lease the tracks to the Chippewa Valley Motor Car Association. The Association has since rehabilitated and used certain segments of the Railway for transportation services.

¶ 5 After chasing Association members off the Railway several times, the Keeses filed suit, seeking a declaration that they, not Northern States, were the rightful owners of the Railway. They asserted the Railway was constructed pursuant to a right-of-way granted by the federal government; the right-of-way, in their view, was subsequently abandoned during Milwaukee Road's bankruptcy and reverted to them under 43 U.S.C. § 912.³ In the alternative, the Keeses claimed they obtained title by adverse possession pursuant to Wis. Stat. § 893.26.⁴

¶ 6 The circuit court granted Northern States' motion for summary judgment on both the Keeses' reverter and adverse possession claims. The court determined the Railway was constructed pursuant to state versus federal law, that it was never abandoned, and that no reversionary rights under 43 U.S.C. § 912 were applicable. As for the Keeses' adverse possession claim, the court determined that the applicable possession period was the longer twenty-year period under Wis. Stat. § 893.25, not the shorter “color of title” period under Wis. Stat. § 893.26. The court further determined that the allegedly adverse acts were insufficient as a matter of law. The final judgment granted Northern States fee title to the Railway. The Keeses now appeal.

DISCUSSION

¶ 7 We review a grant of summary judgment de novo. Olson v. Town of Cottage Grove, 2008 WI 51, ¶ 32, 309 Wis.2d 365, 749 N.W.2d 211. The summary judgment methodology is well established. See Hoida, Inc. v. M & I Midstate Bank, 2006 WI 69, ¶ 16, 291 Wis.2d 283, 717 N.W.2d 17. A party is entitled to summary judgment if there are no genuine issues of material fact and that party is entitled to judgment as a matter of law. Wis. Stat. § 802.08(2). We conclude summary judgment was appropriate on both the Keeses' abandonment and adverse possession claims.

I. Abandonment

¶ 8 The Keeses believe they are entitled to ownership of the Railway by virtue of 43 U.S.C. § 912. This statute, known as the “Abandoned Railroad Right of Way Act,” was designed to dispose of abandoned railroad lands to which the United States holds a right of reverter. Avista Corp. v. Wolfe, 549 F.3d 1239 (9th Cir.2008). “In short, § 912 requires that public lands given by the United States for use as railroad rights of way be turned into public highways within one year of their abandonment or be given to the owners of the land traversed by the right of way.” ⁵Id.

¶ 9 For an underlying landowner to lay claim under 43 U.S.C. § 912, he or she must show that an initial interest was granted by the federal government and subsequently abandoned. The former requirement is evident from the very first words of the statute: only “public lands of the United States” that “have been or may be granted to any railroad company for use as a right of way” qualify for reverter. See Avista Corp., 549 F.3d at 1246. Hence, as a threshold matter, the Keeses must establish that the disputed land was the subject of a conveyance from the federal government. They then must show that the railroad's interest was abandoned, and that abandonment was confirmed by Congress or the courts.

A. The Railway was not the subject of a valid grant from Congress

¶ 10 The Keeses claim the Railway was a grant of public land pursuant to an 1852 federal law. This law, part of a 19th century congressional effort to subsidize railroad construction through “lavish [land] grants from the public domain,” see Great N. R.R. Co. v. United States, 315 U.S. 262, 273, 62 S.Ct. 529, 86 L.Ed. 836 (1942), gave any railroad company chartered at the time or within ten years a 100–foot right of way through public lands, see Right of Way Act of 1852, ch. 80, § 1, 10 Stat. 28, 28 (the “1852 Act”).

¶ 11 Rights of way granted under the 1852 Act came with several conditions. In addition to the threshold eligibility criteria—a timely charter—the company also had to perfect the grant by providing the commissioner of the General Land Office with a correct plat of the survey showing the proposed route. Id., § 3, 10 Stat. at 28. The railroad had to be “begun”—a term whose meaning is disputed by the parties—within ten years from the date of the Act's passage, and needed to be completed within fifteen years. Id. These deadlines, as well as the deadline for chartering a railroad company, were extended by five years in 1862. See Act of July 15, 1862, ch. 179, 12 Stat. 577, 577. We now turn to each of these requirements.

i. The grant is not traceable to a timely chartered company

¶ 12 As a threshold matter, the 1852 Act grants an interest in land only to companies chartered within fifteen years of its passage. The Keeses concede Superior Railway, formed in 1881, was not eligible to receive any interest in federal land under the 1852 Act, but they assert a predecessor company chartered within the relevant period was. Specifically, they contend the Chippewa Valley Railroad Co. (“Chippewa Valley”), chartered in 1857, took advantage of this federal grant.

¶ 13 The Keeses claim the interest obtained through this initial grant to Chippewa Valley was then transferred through five different companies before finally resting with Northern States today. According to the Keeses' chronology, the Chippewa Valley and Lake Superior Railway Co. (“Lake Superior”) was formed in 1870. However, it did not acquire the right-of-way until 1881, when it succeeded to the interests of a company formed that same year upon the merging of Chippewa Valley and the Wabasha and Lake Superior Railway Co. (“Wabasha”). At some point in 1881, Lake Superior apparently transferred the right-of-way to a new company, Superior Railway, which purchased fee title to the Railway. The following year, Superior Railway, which had by then laid track on the Railway, was sold to the Chicago, Milwaukee, and St. Paul Railway Co. (“St.Paul”). St. Paul was the predecessor of the entity the parties call “Milwaukee Road.” Milwaukee Road allegedly obtained the right-of-way in 1927 when it purchased St. Paul's assets. Milwaukee Road then conveyed the right-of-way to Northern States in 1979.

¶ 14 Noteably, the alleged transfers between Wabasha, Lake Superior, and Superior Railway did not involve direct asset acquisitions.⁶ This severely compromises the Keeses' theory of corporate succession. Unlike an appurtenant easement, interests granted under the 1852 Act did not initially run with the land; as we shall explain, they were inchoate interests that required perfection by submitting to the proper authorities a correct plat of the railroad route. This inchoate interest was a corporate right, and documentation of the transfer is necessary. The Seventh Circuit Court of Appeals has held that, absent evidence of a “corporate relationship,” which the court specifically defined as an “asset or stock acquisition that might have made the [tardy company] a successor to the [timely chartered company],” the former company has not satisfied the condition precedent to obtaining a right-of-way under the 1852 Act. Samuel C. Johnson 1988 Trust v. Bayfield Cnty., 649 F.3d 799, 802 (7th Cir.2011).

¶ 15 Instead, the Keeses maintain the transfer of rights occurred by operation of 1868 Wis. Laws, ch. 331, § 9.⁷ That section states that, in all cases “where any franchise or privilege has been or shall be granted by law to several persons, the grant shall be deemed several as well as joint, so that one or more may accept and exercise the franchise as though the same were granted to him or them alone.” According to the Keeses, there was a “corporate relationship [between Chippewa Valley and Lake Superior] insofar that the two companies shared common directors.” In their view, this shared governance was sufficient to trigger ch. 331, § 9, and pass the right-of-way between the...