Sinclair Transportation Company v. Sandberg, Court of Appeals No. 08CA1249 (Colo. App. 9/17/2009)

• Decision Date: 17 September 2009
• Docket Number: No. 08CA1249.,08CA1249.
• Parties: Sinclair Transportation Company, d/b/a Sinclair Pipeline Company, a Wyoming corporation, Petitioner-Appellee, v. Lauren Sandberg, Kay F. Sandberg, Ivar E. Larson, and Donna M. Larson, Respondents-Appellants.
• Court: Court of Appeals of Colorado

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Sinclair Transportation Company, d/b/a Sinclair Pipeline Company, a Wyoming corporation, Petitioner-Appellee, v. Lauren Sandberg, Kay F. Sandberg, Ivar E. Larson, and Donna M. Larson, Respondents-Appellants.

Court of Appeals No. 08CA1249.

Court of Appeals of Colorado, Division VI.

September 17, 2009.

Weld County District Court Nos. 07CV290 & 07CV292, Honorable Daniel S. Maus, Judge, Honorable Paul McLimans, Judge.

In this condemnation action, respondents, Lauren and Kay F. Sandberg and Ivar E. and Donna M. Larson (collectively, landowners), appeal the trial court's order granting petitioner, Sinclair Transportation Company (STC), immediate possession of landowners' properties and its judgment determining the properties' values. We affirm.

ORDER AND JUDGMENT AFFIRMED.

Faegre & Benson, LLP, John R. Sperber, Brandee L. Caswell, Denver, Colorado, for Petitioner-Appellee.

Dean & Reid, LLC, Daniel W. Dean, Fort Collins, Colorado, for Respondents-Appellants.

Opinion by JUDGE HAWTHORNE

I. Facts and Procedural Background

In January 2006, STC, a Wyoming corporation, requested landowners to amend a 1963 easement over landowners' properties in Weld County to allow STC to install within the easement a ten-inch pipeline adjacent to a previously installed six-inch petroleum pipeline. The 1963 easement is fifty feet wide and encumbers approximately 1.04 acres of the Sandbergs' property and 1.75 acres of the Larsons' property.

STC requested the amendment to allow it to supplement the amount of refined petroleum motor fuels it transports by the six-inch pipeline from Sinclair, Wyoming to a distribution terminal in Henderson, Colorado. At the distribution terminal, STC receives, stores, and loads the fuel onto trucks for distribution to wholesalers and customers in the Denver metropolitan area, Nebraska, Wyoming, New Mexico, and Utah.

After negotiations, STC and landowners failed to reach an agreement, and STC initiated condemnation proceedings. At the immediate possession hearing, the trial court found that STC proved by a preponderance of the evidence that it was entitled to immediate possession of landowners' properties. Following a subsequent valuation hearing, the court awarded landowners compensation for their properties in the amounts estimated by STC's appraiser. Landowners now appeal the court's order granting immediate possession and its judgment based on the evidentiary and valuation rulings.

II. Power of Eminent Domain

Landowners contend that the trial court erred by finding that STC has legal authority to condemn landowners' properties because STC does not qualify as an entity granted the power of eminent domain under either section 38-4-102 or section 38-5-105, C.R.S. 2009. We disagree.

A. Standard of Review

In cases involving condemnation proceedings, we review the trial court's factual findings for clear error and review its legal conclusions de novo. E-470 Pub. Highway Auth. v. 455 Co., 3 P.3d 18, 22 (Colo. 2000).

B. Analysis

Private property may not be condemned by a private entity unless there exists express, or necessarily implied, statutory authority to condemn. Colo. Const. art. II, § 15; Buck v. Dist. Court, 199 Colo. 344, 347, 608 P.2d 350, 352 (1980); Dep't of Health v. Hecla Mining Co., 781 P.2d 122, 125 (Colo. App. 1989).

Here, STC's condemnation petition asserts that both section 38-4-102 and section 38-5-105 grant it the power of eminent domain as a foreign pipeline company. Following the immediate possession hearing, the court entered a written order reiterating its ruling made during the hearing that "STC has the legal authority to condemn [landowners' properties]." Even though the court did not cite the legal authority on which it relied, we infer that it relied on section 38-5-105 because it announced its ruling during the hearing shortly after STC argued that it is granted the power of eminent domain under section 38-5-105. Therefore, we begin our analysis with that section.

1. Section 38-5-105

When construing a statute, our primary duty is to ascertain and give effect to the legislature's intent, looking first to the statute's plain language. McIntire v. Trammell Crow, Inc., 172 P.3d 977, 979 (Colo. App. 2007). If the statute's plain language is clear and unambiguous, we apply the statute as written. Garhart ex rel. Tinsman v. Columbia/HealthONE, L.L.C., 95 P.3d 571, 591 (Colo. 2004).

As pertinent here, section 38-5-105 provides:

Such . . . pipeline company . . . is vested with the power of eminent domain, and authorized to proceed to obtain rights-of-way for poles, wires, pipes, regulator stations, substations, and systems for such purposes by means thereof. Whenever such company. . . is unable to secure by deed, contract, or agreement such rights-of-way, or easements of persons or corporations, it shall be lawful for such . . . pipeline company . . . to acquire such title in the manner now provided by law for the exercise of the right of eminent domain and in the manner as set forth in this article.

The phrase "[s]uch . . . pipeline company" in this section necessarily means, as relevant here, by reference back to section 38-5-101, C.R.S. 2009, "[a]ny domestic or foreign . . . pipeline company . . . authorized to do business under the laws of this state." See Reg'l Transp. Dist. v. Aurora Pub. Schs., 45 P.3d 781, 783 (Colo. App. 2001) (use of "the" as article introducing "vehicle designed to transport seven or more passengers" in repealed Colorado statute referred back to the previously specified entity, "a public school vehicle designed to transport seven or more passengers" in that same statute).

Here, STC claims that section 38-5-105 grants it the power of eminent domain because it is a foreign pipeline company authorized to do business in Colorado. However, landowners correctly observe that neither section 38-5-105 nor any other section in Article 5 defines "pipeline company." Therefore, we address whether STC is a pipeline company as that term is contemplated by section 38-51-05.

Because no Colorado statute or case law defines "pipeline company" as it is used in section 38-5-105, we look to the words' plain and ordinary meanings and other jurisdictions' instructive decisions. See People v. Swain, 959 P.2d 426, 432 (Colo. 1998) (where statute does not define "driving," court looks to plain and ordinary meaning); see also In re Marriage of Ciesluk, 113 P.3d 135, 142 (Colo. 2005) (when case presents issue of law of first impression, we may look to other jurisdictions' instructive decisions).

Webster's Third New International Dictionary 1722 (2002) defines "pipeline" as "a line of pipe connected to pumps, valves, and control devices for conveying liquids, gases, or finely divided solids." "Company" is defined as "an association of persons for carrying on a commercial or industrial enterprise or business." Id. at 461.

The following statutory provisions and case law also inform our analysis as to a pipeline company's functions and the substances one commonly conveys:

1. Section 7-43-102, C.R.S. 2009, contemplates that pipeline companies are corporations formed "for the purpose of constructing a pipeline for the conveyance of gas, water, or oil." (Emphasis added.)

2. In the context of "Rights-of-Way: Designated Common Carriers," section 38-4-102 provides that a pipeline company is "[a]ny foreign or domestic corporation organized or chartered for the purpose, among other things, of conducting or maintaining a pipeline for the transmission of power, water, air, or gas." (Emphasis added.)

3. In Larson v. Chase Pipe Line Co., 183 Colo. 76, 79, 514 P.2d 1316, 1317 (1973), our supreme court, without identifying the substance(s) conveyed, determined that a Kansas corporation, authorized to do business in Colorado, that financed and would operate a proposed pipeline in Colorado was a proper entity under the precursor statute to 38-5-105 to bring a condemnation action to obtain a right-of-way across private property.

4. Other jurisdictions define a pipeline company as one conveying, in addition to power, air, gas, water, and oil, other products, including steam, natural gas, processed gas, manufactured gas, crude oil, refined petroleum products, coal, and related products. See Watergate Improvement Assocs. v. Pub. Serv. Comm'n, 326 A.2d 778, 785 (D.C. 1974) ("pipeline company" "includes every corporation . . . owning, operating, managing, or controlling the supply of liquid, steam, or air through pipes or tubing to consumers for use or for lighting, heating, or cooling purposes, or for power" (quoting D.C. Code § 43-121)); see also 49 U.S.C. § 60101(a)(4)(a), (a)(7) (defining "hazardous liquid" as "petroleum or a petroleum product" and "interstate hazardous liquid pipeline facility" as "hazardous liquid pipeline facility used to transport hazardous liquid in interstate or foreign commerce"); ANR Pipeline Co. v. Louisiana Tax Comm'n, 997 So. 2d 92, 95 n.2 (La. Ct. App. 2008) ("`Pipeline company' means any company that is engaged primarily in the business of transporting oil, natural gas, petroleum products, or other products within, through, into, or from this state . . . ." (quoting La. Rev. Stat. Ann. § 47:1851)); Phillips Natural Gas Co. v. State, 402 N.W.2d 906, 908 (N.D. 1987) ("`[p]ipeline company' means a company owning, holding, or operating under a lease or otherwise, any property in this state for the purpose of transporting crude oil, natural gas, processed gas, manufactured gas, refined petroleum products, or coal and related products for public use" (quoting N.D. Cent. Code § 57-06-02(3))); Columbia Gas Transmission Corp. v. Levin, 882 N.E.2d 400, 406 (Ohio 2008) (a person includes a pipeline company "transporting natural gas, oil, or coal or its derivatives through pipes or tubing, either wholly or partially within this state" (quoting Ohio Rev. Code Ann. § 5727.01(D)(5))); Columbia Gas Transmission Corp. v. State Corp. Comm'n, 414 S.E.2d 827, 829 (Va...