Kershaw Sunnyside Ranches, Inc. v. Yakima Interurban Lines Ass'n

• Decision Date: 25 May 2004
• Docket Number: No. 21289-1-III.,21289-1-III.
• Citation: 91 P.3d 104,121 Wash.App. 714
• Court: Washington Court of Appeals
• Parties: KERSHAW SUNNYSIDE RANCHES, INC., a Washington Corporation, Respondent and Cross-Appellant, v. YAKIMA INTERURBAN LINES ASSOCIATION, a Washington Nonprofit Corporation, BNSF Acquisition, Inc., a Delaware Corporation, The State of Washington, Defendants, Level 3 Communications, LLC, a Delaware Limited Liability Company, Appellant, The Burlington Northern and Santa Fe Railway Company, a Delaware Company, Respondent.

91 P.3d 104

121 Wash.App. 714

KERSHAW SUNNYSIDE RANCHES, INC., a Washington Corporation, Respondent and Cross-Appellant, v. YAKIMA INTERURBAN LINES ASSOCIATION, a Washington Nonprofit Corporation, BNSF Acquisition, Inc., a Delaware Corporation, The State of Washington, Defendants, Level 3 Communications, LLC, a Delaware Limited Liability Company, Appellant, The Burlington Northern and Santa Fe Railway Company, a Delaware Company, Respondent.

No. 21289-1-III.

Court of Appeals of Washington, Division 3, Panel Nine.

May 25, 2004.

Mark C. Laughlin, Fraser, Stryker, Meusey, Olson, Boyer & Bloc, Omaha, NE, James S. Berg, James S. Berg PLLC, Yakima, WA, for Appellant.

Kevin T. Montoya, Attorney at Law, Yakima, WA, for Respondent.

KATO, C.J.

Level 3 Communications, LLC, (Level 3) appeals summary judgment orders concluding it trespassed by installing underground telecommunications lines in a railroad right-of-way that crosses property owned by Kershaw Sunnyside Ranches, Inc. (Kershaw). It contends the railroad that approved the installation owned the right-of-way in fee simple; alternatively, it contends the lines are an incidental use of the right-of-way. Kershaw has cross appealed, contending the superior court erred in finding the orders were appealable. We affirm in part, reverse in part, and remand.

The property at issue is a 75-foot-wide railroad right-of-way crossing Kershaw's property between Fruitvale and Naches. The right-of-way was created in 1905 by Edward and Ora Kershaw, then the owners of the property. The 1905 deed is on a preprinted form with handwritten additions. The deed stated in pertinent part (with handwritten portions underlined):

NOW THEREFORE, KNOW ALL MEN BY THESE PRESENTS, That we, the said E.A. Kershaw and Ora A. Kershaw, husband and wife, the parties of the first part, for and in consideration of the sum of one thousand & 00 Dollars, lawful money of the United States, to him in hand paid by the said party of the second part and other good and valuable considerations including the covenants of second party, hereinafter contained[,] receipt whereof is hereby acknowledged, do hereby give, grant, sell, confirm and convey to the said party of the second part, the NORTH YAKIMA & VALLEY RAILWAY COMPANY, a Corporation, its successors or assigns, a strip of land seventy five feet wide, in, along, over and through the hereinafter described land in Yakima County, Washington, the property of said part[y] of the first part, to be used by said party of the second part as a right of way for a railway forever, together with the perpetual right to construct, maintain and operate a railway or railways over and across the same....

TO HAVE AND TO HOLD the said right of way, strip of land, easements, privileges and appurtenances to it, the said North Yakima & Valley Railway Company, its successors or assigns, forever,

Provided, it is understood and agreed that second party[,] its successors or assigns, shall at its or their own proper cost and expense, provide and maintain over and across said railroad and right of way four suitable and convenient crossings of sufficient width to permit the use thereof of wagons, hay rakes and other ordinary farm machinery, in passing to and from the portions of said premises separated by said railroad and right-of-way with proper approaches and one of which shall be an open crossing, provided with proper cattle guards, and the others may be provided with convenient and suitable gates, which shall be provided and maintained by second party, its successors or assigns....

It is understood and agreed that the aforesaid covenants and agreements on the part of second party shall run with said granted right of way and be binding upon said company, and its successors and assigns, so long as a railway may be maintained by it or them, over and across said premises.

Clerk's Papers (CP) at 585-87; see CP 654-55.

The North Yakima and Valley Railway Company later transferred its interest in the right-of-way to the Northern Pacific Railroad, predecessor to the Burlington Northern and Santa Fe Railway Co. (BNSF). BNSF subsequently transferred its interest to the Yakima Interurban Lines Association, reserving to itself the mineral and water rights, as well as "an exclusive, permanent easement for construction, reconstruction, maintenance, use and/or operation of one or more longitudinal pipelines for transporting hydrocarbon substances and telecommunication or fiber optic communication lines." CP at 590. In 1998, BNSF agreed to permit Level 3 to construct a fiber-optic transmission line on the right-of-way. Level 3 installed underground lines on the right-of-way pursuant to this agreement.

Ora Kershaw transferred the Kershaw property to Ronald Kershaw in 1960. The quit claim deed expressly excepted the railroad right-of-way. Ronald and Betty Kershaw transferred the property in 1986 to the family business, Kershaw Sunnyside Ranches, Inc. which is now operated by Ronald Kershaw's two sons, Robert and Edward.

Kershaw filed this action in 2000 against Level 3, BNSF, Yakima Interurban Lines, and the State of Washington. The complaint sought an order quieting title to the right-of-way and allowing removal of the fiber-optic cable, compensation for trespass and damage to personal property, and a permanent injunction against the continued use of the right-of-way by Level 3 and Yakima Interurban Lines. Kershaw later amended the complaint to add allegations that Level 3 had violated 42 U.S.C. § 1983, RCW 80.04.440, and Article I, Section 16 of the Washington Constitution.

Kershaw moved for partial summary judgment, requesting an order "adjudging that none of the Defendants have rights to occupy the real property in which Level 3 Communications laid a fiber-optic cable." CP at 899. The superior court held: (1) the 1905 deed transferred only a right-of-way for a railroad, not a fee simple interest, and the Kershaws retained the subsurface rights to the property; (2) Level 3 had the right to use the right-of-way for its fiber-optic cable, but only through the eminent domain process, with just compensation to Kershaw; and (3) the right-of-way had not been abandoned.

Level 3 moved to dismiss the additional claims stated in Kershaw's amended complaint. Kershaw then moved for partial summary judgment on the issues of liability for trespass and for violation of 42 U.S.C. § 1983 and RCW 80.04.440. In a memorandum opinion, the superior court posed and answered the issues as follows:

1. Whether Level 3 Communications had authority to bury its fiber optic telecommunications cable in the right-of-way ... without paying compensation to [Kershaw]. ANSWER: No. The authority granted by BNSF was insufficient.

2. Whether the right to compensation granted by the doctrine of eminent domain for the burden of a fiber optic telecommunications cable extends to [Kershaw] as fee owner of the servient estate where the dominant estate is a railroad right-of-way.

ANSWER: Yes. A telecommunications fiber optic [cable] buried within a private railroad right of way ... is an unreasonable burden on the fee owner of the property. It was not bargained for in the original grant of a right-of-way to the railroad. It is not an incidental use of the railway in the traditional sense. A telecommunications company has the right to condemn the property for an easement to bury its fiber optic cable. Any property owner whose property is taken in whole or in part by such a burden is entitled to compensation.

3. Whether a telecommunications fiber optic cable buried in this railroad right-of-way is an incidental use of the railroad.

ANSWER: No. Incidental uses are measured by what is reasonably necessary for the building, operation and maintenance of the railroad. Where the fiber optic cable will be used substantially to service other members of the public and where the railroad is not significantly dependent on the fiber optic cable for its primary means of communication, the cable is not an "incidental use" of the railroad.

4. Whether Level 3 Communications has trespassed on the property of [Kershaw] by burying its fiber optic cable in the railroad right of way running through [Kershaw's] property.

ANSWER: Yes. Either direct authority from [Kershaw] or authority granted vis a vis a condemnation order was necessary for Level 3 Communications to bury its fiber optic cable within the railway corridor crossing [Kershaw's] property. [Kershaw] has not granted permission nor has a condemnation order been entered allowing the burial.

5. Whether the court's [previous] ruling ... regarding [Kershaw's] subsurface rights is inconsistent with its ruling that Level 3 Communications may bury its cable with condemnation damages for [Kershaw].

ANSWER: No. Subsurface rights refer to mineral and related rights, not to the top soil lying beneath the surface. Regardless of whether a fiber optic cable is buried in top soil or a deeper stratum, and regardless whether minerals are disturbed, Level 3 Communications may bury its cable only with direct permission of [Kershaw] or upon paying damages as measured by the doctrine of condemnation. Condemnation may be instituted by Level 3 Communications. An inverse condemnation claim may be instituted by [Kershaw]. [Kershaw] is not compelled to file an inverse condemnation claim. If neither party proceed[s] with a condemnation action, [Kershaw] will be entitled to other legal or equitable relief, and may not be limited to damages of "just compensation" measured by the doctrine of condemnation. Mineral, gas, and other valuable subsurface rights remain unresolved as between [Kershaw] and the railroad successors and assigns of N.Y. & V. Ry. Co. These potential competing rights have not been put in issue by the pleadings.

CP at 809-11.

The court entered an order consistent with its prior summary judgment order and its memorandum opinion. Level 3 filed this appeal, but this court remanded for entry of ...