Scherger v. Northern Natural Gas Co., CX-96-2319

• Decision Date: 05 March 1998
• Docket Number: No. CX-96-2319,CX-96-2319
• Citation: 575 N.W.2d 578
• Parties: Util. L. Rep. P 26,650 Norbert SCHERGER, et al., Respondents, v. NORTHERN NATURAL GAS COMPANY, petitioner, Appellant.
• Court: Minnesota Supreme Court

Page 578

575 N.W.2d 578

Util. L. Rep. P 26,650

Norbert SCHERGER, et al., Respondents, v. NORTHERN NATURAL GAS COMPANY, petitioner, Appellant.

No. CX-96-2319.

Supreme Court of Minnesota.

March 5, 1998.

Rehearing Denied April 7, 1998.

Eastlund, Solstad & Hutchinson, Ltd., Thomas F. Hutchinson, Daniel J. McGarry, Minneapolis, Joseph R. Cade, Savage, for Appellant.

Dunlap & Seeger, P.A., Kenneth R. Moen, Rochester, for Respondents.

Heard, considered, and decided by the court en banc.

OPINION

PAGE, Justice.

Norbert and Delores Scherger (the "Schergers") petitioned the Dodge County District Court for a writ of mandamus ¹ requiring Northern Natural Gas Co. ("Northern") to initiate condemnation proceedings in order to replace an existing Northern pipeline located within an easement on the Schergers' property. After cross-motions for summary judgment on stipulated facts, the district court denied the Schergers' motion seeking to require Northern to initiate condemnation proceedings and granted Northern's motion, which sought to have the Schergers' action dismissed. On appeal, the court of appeals reversed and remanded, holding that the location of Northern's replacement pipeline easement on the Schergers' property "must be within the scope of the easement as defined by construction of the original 1932 pipeline." We reverse and reinstate the summary judgment entered in favor of Northern.

The stipulated facts are as follows: Northern is a Delaware corporation engaged in the transportation of natural gas in interstate commerce through a pipeline system it owns, operates, and maintains. The Schergers are the owners of farm property located in Dodge County, Minnesota. On November 3, 1931, the Schergers' predecessors in title granted an easement in favor of Northern. Among other things, the agreement granting the easement gave Northern a "blanket" easement ² over and through a portion of the Schergers' property "together with the right of ingress to and egress from said premises, for the purpose of constructing, inspecting, repairing, maintaining and replacing the property of the grantee located thereon, or the removal thereof, in whole or in part, at the will of the grantee." The easement agreement also provides for the payment of "the sum of Fifty Cents (50cents) per lineal rod * * * which is to be paid when and as the location of pipe lines over and through the lands hereinafter described shall be established, surveyed and measured * * *." In 1932, pursuant to this agreement, Northern constructed a natural gas pipeline through the Schergers' property, which it has operated and maintained since.

By letter dated October 26, 1995, Northern informed the Schergers that, pursuant to the 1931 easement agreement, it intended to "replace" the pipeline running through the Schergers' property. At that time, Northern tendered a check to the Schergers for $905 as compensation for installing the replacement pipeline. ³ The replacement pipeline was to run alongside the original pipeline, 50 feet away at its closest point and 300 feet at its most distant. The Schergers responded to Northern's letter by demanding, pursuant to Minn.Stat. § 300.045 (1996), "a definite and specific description of [Northern's] present gas pipeline easement on their property." Further, the Schergers demanded that a new easement agreement be negotiated and that if negotiations were unsuccessful, "then [Northern] should use [its] eminent domain powers" to acquire a new easement. In response, Northern indicated that it was willing to define the "present pipe line easement" across the property when construction of the replacement pipeline was completed, but asserted that the original easement agreement gave it the right to put the replacement pipeline anywhere on the property within the boundaries of the original easement grant. ⁴

The Schergers petitioned for a writ of mandamus, seeking to require Northern to initiate condemnation proceedings in order to replace the original pipeline. In denying the Schergers' motion for summary judgment and granting Northern's motion, the district court found that "there is no ambiguity in the terms of the easement, and that the easement grants [Northern] the right to replace the pipeline." In addition, the district court found that Minn.Stat. § 300.045 was inapplicable. Importing an analysis from the Washington Court of Appeals, the Minnesota Court of Appeals reversed, holding that the location of the replacement pipeline must be within the scope of the easement "as defined by construction of the original 1932 pipeline." Scherger v. Northern Natural Gas Co., 562 N.W.2d 328, 331 (Minn.App.1997) (citing Mielke v. Yellowstone Pipeline Co., 73 Wash.App. 621, 870 P.2d 1005 (1994)). It remanded for a determination of whether or not Northern's replacement pipeline was "within the 'line of reasonable enjoyment' of the original easement * * * or within 'the minimum necessary for the safe conduct of [Northern's] business' " (quoting Mielke and Minn.Stat. § 300.045). While using the statute's language, the court of appeals declined to reach the issue of the applicability of Minn.Stat. § 300.045.

We are presented with two issues: (1) whether Northern, as grantee, under a blanket easement, has the right under the terms of the 1931 easement agreement to replace the pipeline constructed on the Schergers' property in 1932, with a new pipeline, at a different location within the easement; and (2) whether a demand under Minn.Stat. § 300.045 for a legal description of an older, existing easement legally restricts Northern's easement to the location of the original pipeline.

An easement is an interest in land possessed by another which entitles the grantee of the interest to a limited use or enjoyment of that land. Minneapolis Athletic Club v. Cohler, 287 Minn. 254, 258, 177 N.W.2d 786, 789 (1970). The extent of an easement depends entirely upon the construction of the terms of the agreement granting the easement. Hwy. 7 Embers, Inc. v. Northwestern Nat'l Bank, 256 N.W.2d 271, 275 (Minn.1977). "When the terms of an easement grant are unclear, extrinsic evidence may be used to aid in the interpretation of the easement grant; however, when the language granting the easement is clear and unambiguous, the court's power to determine the extent of the easement granted is limited." Bergh and Misson Farms, Inc. v. Great Lakes Transmission Co., 565 N.W.2d 23, 26 (Minn.1997). While ambiguities in contract agreements are resolved against the drafter, see, e.g., Cherne Indus., Inc. v. Grounds & Assoc., Inc., 278 N.W.2d 81, 89 (Minn.1979), "[g]enerally, an easement grant is to be strictly construed against the grantor." Bergh, 565 N.W.2d at 26 (citing Romanchuk v. Plotkin, 215 Minn. 156, 160, 9 N.W.2d 421, 424 (1943)).

The Schergers contend...