Sinclair Pipe Line Company v. United States

• Decision Date: 01 March 1961
• Docket Number: No. 537-59.,537-59.
• Citation: 287 F.2d 175
• Parties: SINCLAIR PIPE LINE COMPANY v. UNITED STATES.
• Court: U.S. Claims Court

287 F.2d 175 (1961)

SINCLAIR PIPE LINE COMPANY v. UNITED STATES.

No. 537-59.

United States Court of Claims.

March 1, 1961.

Harold Medill, Independence, Kan., for plaintiff.

Howard O. Sigmond, with whom was Perry W. Morton, Asst. Atty. Gen., Washington, D. C., for defendant.

WHITAKER, Judge.

Plaintiff sues to recover just compensation for the alleged taking of its right to maintain and operate a section of pipeline across land acquired by defendant through condemnation proceedings. Plaintiff had acquired from the former owner permission to maintain its pipeline on the land condemned by defendant, but, upon acquisition of the property by defendant, it was required to remove its pipeline from the property.

A section of plaintiff's pipeline system had been maintained and operated on land owned by the Pennsylvania Railroad Company in Dauphin County, Pennsylvania, under a written agreement dated November 1, 1942, with the railroad, under which it extended to plaintiff "permission and privilege as a mere license, revocable and terminable upon notice as hereinafter provided * * *" to construct and maintain its pipeline across the land in question. Paragraph 5 of the agreement provided in part:

"In the event of the lease, sale or disposal of the premises or any part thereof encumbered by this license, then the Refining Company shall, at its sole cost and expense, make such adjustments of, relocation in or removal of its facilities as may be requested by the Railroad Company, or its grantees * * *."

In 1956 defendant, in order to construct the Olmsted Air Force Base, instituted condemnation proceedings in the United States District Court, Middle District of Pennsylvania, to acquire the land on which plaintiff had installed its pipeline. A declaration of taking was filed whereby defendant acquired from the railroad the fee simple title to the land, subject only to existing easements for public roads and highways, public utilities, railroads and pipelines. Following the acquisition of title, defendant took possession of the land.

Thereafter, on November 26, 1958, plaintiff and defendant entered into a written contract whereby plaintiff agreed to relocate its pipeline to allow for the development of the Air Force Base, and it did relocate it. Defendant paid plaintiff for the cost of relocating that portion of its pipeline which was located on land in which plaintiff had an easement, but it refused to pay for the cost of relocating that portion located on land in which the Government thought plaintiff did not have an easement, which is the portion with which we are concerned. Plaintiff, however, reserved "the right at its election to claim compensation from the Government for the cost of relocating its existing facilities between points `A' and `B', Exhibit `B'," the portion with which we are concerned. Plaintiff now claims its cost of relocation of these facilities, as compensation for the taking of what it calls a "terminable easement" in the lands.

Defendant says that plaintiff had no compensable interest in the land, but a mere license to maintain the pipeline across the railroad's land, subject to the railroad's right, under paragraph 5 of its agreement with plaintiff, supra, to require plaintiff to relocate it at its own expense, in case of sale or lease, and it asserts that it acquired this right when it acquired the fee.

In its declaration of taking, defendant set out what it wanted and what it intended to take. The stipulation of facts shows that the declaration of taking recited that the United States was taking "the fee simple title to said land * * *, subject only to existing easements for public roads and highways, public utilities, railroads, and pipe lines." Hence, the defendant did not take any easement in the property owned by a pipeline company, among other easements, and, so, if plaintiff had an easement in the property, it was not taken.

It seems plain that plaintiff did not have an easement. The railroad took pains not to grant an easement. The contract between it and the pipeline company recited that the railroad company "extends to the said Refining Company permission and privilege, as a mere license, revocable and terminable upon notice as hereinafter provided, to construct * * *." This was not the grant of an easement in the property. The railroad parted with no part of its title. Notwithstanding the license, it continued to own the property in fee simple; its title was unencumbered, and could be transferred free of any claim to an interest in the property by the pipeline company.

Had it intended to convey an interest in the land, which could be asserted against a subsequent owner, the contract would have used words of conveyance, such as "grant" and "convey"; instead, it recited that the railroad company extended "permission and privilege, as a mere license." Had there been an intention to convey an interest, the contract would have been acknowledged and recorded, so that subsequent owners of the property would be bound by the terms of the contract. Neither was done.

All the authorities recognize a distinction between an easement and a license, and the difference in the rights of the holder of one as against the other. Thomson, Real Property, Vol. I, § 318 (1939 ed.) distinguishes an easement from a license as follows:

"An easement should be carefully distinguished from a license given to one person to do something on the land of

...