Panhandle Eastern Pipe Line v. Madison Cty.
| Decision Date | 18 September 1995 |
| Docket Number | No. IP 95-0682-C H/G.,IP 95-0682-C H/G. |
| Citation | 898 F. Supp. 1302 |
| Parties | PANHANDLE EASTERN PIPE LINE COMPANY, a Delaware corporation, Plaintiff, v. MADISON COUNTY DRAINAGE BOARD, Stephen E. Randolph, Gene Best, Doug Drake, Jeff Purdue, Ted Waymire, Emley J. Hallgrath, Patrick Manship, Bradley A. Rayl Surveying and Engineering, and Van Horn Excavating, Inc., Defendants. |
| Court | U.S. District Court — Southern District of Indiana |
COPYRIGHT MATERIAL OMITTED
Thomas A. Withrow, Henderson Daily Withrow & Devoe Indianapolis, Indiana, for plaintiff.
William J. Norton, Anderson, Indiana, for defendants.
Dennis F. McCrosson, Stilwell, McCrosson & Life, Indianapolis, Indiana for intervenor Jane Morehead.
Nancy L. Gettinger, Office of the Attorney General, Indianapolis, Indiana for amicus curiae State of Indiana.
FINDINGS OF FACT AND CONCLUSIONS OF LAW ON COMPLAINT FOR INJUNCTIVE AND DECLARATORY RELIEF
This case concerns the ditches of Madison County, Indiana. It pits the interests of farmers who need to drain their land against the interests of a pipeline company whose underground pipelines run through the needed drainage ditch. Plaintiff Panhandle Eastern Pipe Line Company ("Panhandle") brought this action against the Madison County Drainage Board (the "Drainage Board"), its members, and an engineering firm and an excavation company hired to provide services to the Drainage Board. The defendants plan to deepen and widen the John Dugan Regulated Drain in order to improve drainage of nearby farmland. Panhandle seeks injunctive and declaratory relief to prevent the Drainage Board from widening and deepening the drain in ways that would either damage several Panhandle pipelines or force Panhandle to incur substantial expense in burying those pipelines deeper in the ground. Panhandle argues that Indiana law does not authorize, and that the federal Constitution forbids, the Drainage Board's attempt to require Panhandle to bear the cost of burying its pipelines deeper to accommodate the drainage project. Panhandle also argues that the Drainage Board has acted without giving Panhandle notice required by Indiana statute. This entry states the court's findings of fact and conclusions of law pursuant to Fed.R.Civ.P. 52(a). In summary, the court concludes that Ind.Code § 36-9-27-48 authorizes the Drainage Board to require Panhandle to pay the cost of reburying its pipelines, but that the law violates the takings clause of the Fifth Amendment as applied to Panhandle under the circumstances of this case. The court will enter a declaratory judgment to that effect.
Panhandle filed its original complaint on May 23, 1995, seeking preliminary and permanent injunctive relief. On May 25, 1995, Panhandle filed its motion for a temporary restraining order and amended the request in its complaint for preliminary and permanent injunctive relief. The court held a hearing with notice that same day on the application for a temporary restraining order. At the hearing, Juanita Morehead (also known as Jane Morehead) appeared by counsel and was granted leave to intervene as a defendant. Ms. Morehead owns farmland that would benefit if the Drainage Board carries out its proposed project, and her interests will be harmed if the project does not go forward. Because the imminence of the threatened harm was not clear at the May 25 hearing, the court took under advisement Panhandle's motion for a temporary restraining order and set a briefing schedule and hearing date for Panhandle's motion for a preliminary injunction. On May 31, 1995, Panhandle filed its Amended Motion for Temporary Restraining Order. That motion was not ruled upon and became moot.
On June 16, 1995, the court held a hearing on Panhandle's motion for preliminary injunction. The court received stipulated evidence1 and heard testimony from Bradley Rayl, an engineer who has planned the project to reconstruct the John Dugan Drain. After hearing argument, the court issued an oral ruling denying Panhandle's motion for preliminary injunction on the basis that the threat of irreparable harm to Panhandle was not sufficiently imminent to warrant a preliminary injunction. The court stated that it believed prompt declaratory relief would be sufficient to protect Panhandle's interests in the event that Panhandle should prevail on the merits of its claims. However, the court said it would delay its ruling in order to provide an opportunity for the State of Indiana to file a brief on the constitutionality of Ind.Code § 36-9-27-48, and to provide other parties an opportunity to respond. The court also stated its intention to treat the factual record made at the preliminary injunction hearing as the factual record for purposes of a final judgment on declaratory relief, subject to the parties' rights to seek by July 10, 1995, permission to supplement the record. No party has asked to submit additional evidence.2 Defendants have not answered the complaint but have moved to dismiss on the basis of arguments that will be addressed in this decision. Plaintiff filed on June 28, 1995, an amended complaint that makes clear it is seeking declaratory relief as well as injunctive relief. Accordingly, this matter is ripe for final judgment on the existing factual record.
1. Plaintiff Panhandle Eastern Pipe Line Company is a Delaware corporation with its principal place of business in Houston, Texas. Panhandle operates transmission lines for natural gas from points of origin in Texas, Oklahoma, and Kansas, through Missouri, Illinois, Indiana, Ohio, and Michigan. Panhandle owns and operates four underground pipelines running through the State of Indiana; those pipelines are designated the 100 Line, the 200 Line, the 300 Line, and the 400 Line (collectively, "the Lines").
2. Defendant Madison County Drainage Board is a public body established by Ind. Code § 36-9-27-4. Its individual members are defendants Stephen E. Randolph, Gene Best, Doug Drake, Jeff Purdue, Ted Waymire, and Emley J. Hallgarth, who are all citizens of Indiana. Defendant Patrick Manship is the County Surveyor of Madison County, Indiana, and also a citizen of Indiana. Defendant Bradley A. Rayl Surveying and Engineering is a citizen of Indiana, and defendant Van Horn Excavating, Inc. is an Indiana corporation with its principal place of business in Fulton County, Indiana.
3. Panhandle's Lines run through the John Dugan Regulated Drain in Madison County. Panhandle owns easements and rights-of-way for its Lines running through the John Dugan Regulated Drain. Panhandle obtained those rights in 1936, 1943, and 1962. Panhandle's easements and rights-of-way are recorded in the Office of the Recorder of Madison County. Some of Panhandle's easements and rights-of-way were obtained through condemnation proceedings using the power of eminent domain.
4. Intervenor Juanita Morehead is a citizen of Indiana who owns farmland that would benefit if the John Dugan Drain is improved.
5. Engineers for the Drainage Board found that the John Dugan Drain was not adequate for its purpose: it could not carry measurable amounts of precipitation without the adjacent farmlands standing in water for long periods of time. In 1992, defendant Bradley Rayl Engineering submitted to the Drainage Board a proposal for repairing and improving the John Dugan Drain, including deepening and widening the drain. Pursuant to Ind.Code § 36-9-27-1 et seq., the Drainage Board has the authority to reconstruct and to widen such regulated drains and to assess the costs of such projects from the owners of the land that benefits from any such project. The statute specifies the procedures the Drainage Board must follow to approve such a project and to assess the costs from property owners.
6. On February 26, 1992, the Drainage Board held a public hearing on a petition to reconstruct the John Dugan Drain. The Drainage Board approved the petition.
7. The Drainage Board had issued prior written notice of the petition and hearing to affected property owners identified on the tax rolls, but did not give Panhandle prior written notice of the petition and hearing concerning the proposed reconstruction of the John Dugan Drain.
8. On May 24, 1995, after successfully defending the proposed project against challenges by other parties in the state courts, the Drainage Board planned to approve a contract with defendant Van Horn Excavating to carry out the proposed reconstruction of the John Dugan Drain for approximately $90,000. The filing of this suit has apparently delayed final approval of the contract, and the Drainage Board does not intend to give the contractor notice to proceed until this court decides whether Panhandle may be required to bear the cost of relocating its pipelines to accommodate the enlarged drain.
9. The Drainage Board's plans for reconstruction call for deepening the John Dugan Drain by 5 and ½ feet, and widening it by about 10 feet. If Panhandle's pipelines were not moved, enlarging the drain by this amount would expose and suspend in mid-air about 15 to 25 feet of three of Panhandle's pipelines, and would substantially reduce the amount of "cover" over the fourth line to as little as a few inches.
10. Safety requirements imposed by federal law require Panhandle to maintain a sufficient amount of "cover" on its underground pipelines. See, e.g., 49 C.F.R. § 192.327. Panhandle's 100 Line is 22 inches in diameter and is rated up to 760 pounds per square inch maximum allowable operation pressure (MAOP). The 200 Line is 24 inches in diameter and is also rated up to 760 pounds per square inch MAOP. The 300 Line is 30 inches in diameter and is rated up to 810 pounds per square inch MAOP. The 400 Line is 30 inches in diameter and rated up to 900 pounds per square inch MAOP.
11. Relocating or lowering the pipelines to comply with federal safety requirements would require an estimated eleven to twelve months to design...
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