Northwest Natural Gas Co. v. City of Portland

• Decision Date: 21 December 1984
• Parties: NORTHWEST NATURAL GAS CO., Pacific Power & Light Co., Pacific Northwest Bell, and General Telephone Company of the Northwest, Appellants, v. CITY OF PORTLAND, County of Multnomah, Tri-County Metropolitan Transportation District, Respondents, State of Oregon, Defendant, Portland General Electric Company, Appellant. A8302-00967; CA A28765.
• Court: Oregon Court of Appeals

Page 1099

690 P.2d 1099

70 Or.App. 647

NORTHWEST NATURAL GAS CO., Pacific Power & Light Co Pacific Northwest Bell, and General Telephone Company of the Northwest, Appellants, v. CITY OF PORTLAND, County of Multnomah, Tri-County Metropolitan Transportation District, Respondents State of Oregon, Defendant Portland General Electric Company, Appellant.

A8302-00967; CA A28765.

Court of Appeals of Oregon.

Argued and Submitted June 20, 1984.

Decided Nov. 7, 1984.

Reconsideration Denied Dec. 21, 1984.

Jacob Tanzer, Portland, argued the cause for appellants Northwest Natural Gas, Pacific Power & Light, Pacific Northwest Bell, and General Telephone Company of the Northwest. With him on the briefs was Ball, Janik & Novack, Portland.

Warren Hastings, Portland, argued the cause and filed the briefs for appellant Portland General Electric Co.

Christopher P. Thomas, City Atty., Portland, argued the cause for respondent City of Portland. With him on the brief was Kathryn Beaumont Imperati, Portland.

Paul R. Meyer, Portland, argued the cause for the respondents County of Multnomah and Tri-County Metropolitan Transportation District. With him on the brief were Susan G. Whitney, and Kobin & Meyer, Portland, and John Leahy, Multnomah County Counsel, Portland.

Before RICHARDSON, P.J., and WARREN and ROSSMAN, JJ.

WARREN, Judge.

Over the past decade, as a result of a planning process involving governmental units and local citizens, the Banfield Transitway Project was chosen from among 30 alternative proposals as the solution to the transportation problems along the Banfield Freeway/Burnside Street Corridor in Multnomah County. The project involves improvements to the existing Banfield Freeway as well as the construction of a light rail transit system (LRT) owned and operated by Tri-County Metropolitan Transportation District (Tri-Met) to connect downtown Portland with Gresham. The construction necessitates extensive relocation of facilities within the public right-of-way of investor-owned utilities Northwest Natural Gas (NNG), Pacific Power and Light (PP & L), Pacific Northwest Bell (PNB), General Telephone (Gen Tel) and Portland General Electric (PGE) (hereinafter "Utilities").

This proceeding for declaratory relief arises from the dispute between the Utilities and Portland, Multnomah County, and Tri-Met (defendants) ¹ as to who must pay for the costs of the relocation. The trial court found that Utilities must pay, and they appeal. We affirm in part and reverse in part.

Utilities locate their facilities in a public right-of-way at the sufferance of the government. Government can require the facilities to be moved when the public way is needed for a public use and, if it does, the Utilities have no automatic claim for a taking of their property because of the loss of the capital investment in their existing facilities. See New Orleans Gaslight Co. v. Drainage Commission of N.O., 197 U.S. 453, 458-59, 25 S.Ct. 471, 472-73, 49 L.Ed. 831 (1904); N.O. Gas Light Co. v. Louisiana Light Mfg. Co., 115 U.S. 650, 6 S.Ct. 252, 29 L.Ed. 516 (1885).

In this case the Banfield Transitway Project is divided into four segments--Gresham, Multnomah County, Banfield and City of Portland, and not all Utilities nor all defendants are involved in every segment. Determination of the rights and liabilities involves consideration of common law, franchise agreements, statutes, ordinances and a 1928 deed. The inquiry which arises in the analysis of all the legal relationships between the parties, apart from the 1928 deed, is whether the construction of LRT is a legitimate governmental activity.

We have considered the franchise agreements, ordinances and statutes briefed by the parties and find that they are inapplicable ² or that they do not address the question of who must bear the cost of relocation ³ or that the language of the franchises and laws must be interpreted according to common law. Portland has granted a franchise to PNB and a revocable license to PP & L. Under the language of both, the Utilities must pay for relocation of facilities interfering with "public works." PGE and the city stipulated that any existing franchise agreement "expressly reserves to the City of Portland the full police power over such public streets." However, whether or not the installation of LRT is a "public work" or within the "police power" of Portland must be determined by common law. The parties agree that the franchise to NNG does not address relocation costs.

We turn first then to the 1928 deed. The rights of PGE and PP & L on East Burnside and Burnside Court are governed by a 1928 deed from PGE's predecessor, Portland Electric Power Company, to the County. In 1982, PGE sold its facilities between 97th and 122nd Avenue on East Burnside to PP & L. In 1982, PP & L demanded and received from PGE a deed for the real property on which the poles are located. ⁴ Presently PGE has power lines on both sides of East Burnside and on Burnside Court. The lines and poles on East Burnside between 97th and 122nd Avenues belong to PP & L, except for a transmission line across 97th Avenue into the Russellville substation that is owned by PGE. Between 122nd Avenue and the termination of Burnside Court, Gen Tel maintains wires with the permission of PGE.

In 1928, the Portland Electric Power County deeded 67 tracts of land to the county for use as a public highway ⁵ and reserved an easement with the following language:

"The above described property has heretofore been used by the Grantor as a right-of-way for railroad and electric transmission line purposes and it is expressly understood that the Grantor reserves from the operation of this deed the physical improvements constituting the said railroad and/or said transmission line. * * * [I]t is also understood that the Grantor will continue the maintenance and operation of said transmission lines over and upon said property and shall have the right to go upon and over said property for the purpose of constructing, maintaining and operating electric transmission lines thereon and thereover in such location as may be prescribed by the said County.

"As part consideration of this deed, but not as a condition in any way affecting the title conveyed hereunder, the said County will:

" * * *

"(2) Reimburse the Grantor for any expense that the Grantor may be reasonably put to by reason of any change in the present location of its existing transmission line as required by the County, and/or as may be reasonably necessary because of the construction, maintenance and operation of a public highway upon said property; provided, however, that if, prior to any required change as aforesaid in the location of said transmission line, or section thereof, the grantor shall, by reason of deterioration, destruction or similar cause, rebuild said transmission line, or any section thereof, with ten or more consecutive poles, the grantor will rebuild its said transmission line, or said section thereof, at its sole expense upon a location over said lands to be designated by the County for the building, construction and operation of a public highway upon said lands.

The agreement thus requires the county to pay for relocation if the county forces a change in the existing line before the company rebuilds the line. After 1928, the company voluntarily relocated the existing line which had been constructed in 1913. On the north side of Burnside replacement took place in 1930 and 1934. On the south side the line was replaced in 1948. The company paid for the relocation. While we agree with the trial court that the deed agreement as to who would pay for relocation referred only to the line that existed in 1913, we disagree that, because the company voluntarily replaced that line, it is required to bear the expense of the present relocation.

The deed is silent as to who should bear the cost for later relocations required by the county. The county argues:

"The easement created by the 1928 deed simply gives the power company the right to have its transmission line somewhere within or upon the right-of-way. There is no right created as to a specific location for that transmission line. Any right to reimbursement under the 1928 deed would derive from the specific provisions in that deed regarding reimbursement, and there is no separate right to reimbursement created by the mere fact that Portland Electric Power Company [reserved] an easement. So long as the power company is still allowed to locate its line somewhere within the public right-of-way, no property rights are taken from the power company when it is requested to relocate somewhere within that right-of-way."

The deed language shows that the grantor intended to keep an interest in, and separate from, the land given for a public use. Multnomah County accepted the dedication with the easement. See Sunset Lake v. Remington, 45 Or.App. 973, 976, 609 P.2d 896 (1980). The rights of PG & E and PP & L originated, not from their facilities being located within the public right of way, but from an express reservation in a deed made by a fee owner.

Although the deed here does not specify a particular location of the easement, the relocation of the 1913 line did not effect an abandonment of the easement that allows the servient owner, the county, to order relocation without compensation. For at least 49 years on the north side of Burnside and 35 years on the south, the county has known about and acquiesced in the location of the lines. That acquiescence has given the easement a definite location. See Beck v. Lane County, 141 Or. 580, 589, 18 P.2d 594 (1933). The location cannot be changed without consent of both the landowner and easement owner:

"After the point or place at which, or lying along which an easement is to be exercised has once been fixed, whether by express terms of the grant, or by agreement or acquiescence, one of the parties cannot change such location without the...