Tenneco, Inc. v. May, 2300.

• Decision Date: 24 June 1974
• Docket Number: No. 2300.,2300.
• Parties: TENNECO, INC., Plaintiff, v. Glenn MAY et al., Defendants.
• Court: U.S. District Court — Eastern District of Kentucky

377 F. Supp. 941

TENNECO, INC., Plaintiff, v. Glenn MAY et al., Defendants.

No. 2300.

United States District Court, E. D. Kentucky, Lexington Division.

June 24, 1974.

John E. Smith, Lancaster, Ky., R. Vincent Goodlett, Halzelrigg & Cox, Frankfort, Ky., for plaintiff.

William R. Bagby, Lexington, Ky., for defendants.

MEMORANDUM

SWINFORD, District Judge.

On May 6, 1957, the plaintiff was granted an easement for an underground pipeline across the defendants' property. The pipeline was duly installed and maintained without interference with the servient estate. Early in 1971, the defendants commenced construction of a paved roadway over portions of the Tenneco easement. This action for injunctive relief and damages was initiated following the plaintiff's determination that the contemplated road and vehicle traffic would place excessive stress on the pipeline. An agreed order entered October 26, 1971, temporarily enjoining the defendants from using the affected area as a public thoroughfare enabled the plaintiffs to "encase" the pipe to withstand the pressures engendered by highway traffic. A hearing conducted on May 31, 1972, resulted in stipulations regarding most of the facts alleged in the complaint. The record is before the court for determination whether the defendants are responsible for the $4,903.39 cost of strengthening the pipeline.

A peripheral issue is raised concerning the jurisdiction of this court. It is argued that the plaintiff's assertion of both federal question and diversity jurisdiction is without foundation. Although the complaint attempts to predicate jurisdiction upon 28 U.S.C. § 1337 and 15 U.S.C. § 717 et seq., it is evident that the federal aspects of this claim are at best insubstantial, and that the substantive issue resounds intrinsically in state law. Pan American Petroleum Corporation v. Cities Service Gas Company, D.Kan., 182 F.Supp. 439, 446 (1958). While the complaint's recitation of an amount in controversy exceeding $10,000 properly invoked 28 U.S.C. § 1332, the parties have since agreed that the damages incurred amounted to $4,903.39. The defendants mistakenly seize upon this reduction as grounds for dismissal for lack of subject matter jurisdiction. The requisite amount in controversy is ascertained at the commencement of the action, by reference to the good faith allegations of the complaint.

"(T)he sum claimed by the plaintiff controls if the claim is apparently made in good faith. It must appear to a legal certainty that the claim is really for less than the jurisdictional amount to justify dismissal. The inability of plaintiff to recover an amount adequate to give the court jurisdiction does not show his bad faith or oust the jurisdiction. . . . But if, from the face of the pleadings, it is apparent, to a legal certainty, that the plaintiff cannot recover the amount claimed or if, from the proofs, the court is satisfied to a like certainty that the plaintiff never was entitled to recover that amount, and that his claim was therefore colorable for the purpose of conferring jurisdiction, the suit will be dismissed. Events occurring subsequent to the institution of suit which reduce the amount recoverable below the statutory limit do not oust jurisdiction." St. Paul Indemnity Co. v. Cab Co., 303 U.S. 283, 288-290, 58 S.Ct. 586, 590, 82 L.Ed. 845 (1938).

The complaint sought equitable relief preventing the defendants from continuing operations which would allegedly result in a disruption of operations costing in excess of $10,000. In injunction actions, "the amount in controversy is determined by the value of the property right sought to be protected against the alleged interference." Hulsenbusch v. Davidson Rubber Company, 8th Cir., 344 F.2d 730, 733 (1965). See also Garland v. Humble Oil & Refining Company, E. D.Tenn., 306 F.Supp. 608, 609 (1969); Dosdall v. Fraser, D.Mont., 246 F.Supp. 311, 313-314 (1965). The fact that the amount recoverable was subsequently stipulated at less than $10,000 does not defeat jurisdiction.

"(W)here plaintiff, by stipulation, affidavit or amended pleading, reduces his claim below the requisite jurisdictional amount, the district court is not deprived of jurisdiction. . . . (E)vents subsequent to the filing of the complaint which reduce the amount recoverable will not affect Federal jurisdiction that has been initially properly invoked." DeLorenzo v. Federal Deposit Insurance Corporation, S.D.N.Y., 259 F.Supp. 193, 196 (1966).

St. Paul Indemnity Co. v. Cab Co., supra; Lewis v. Cook, 6th Cir., 409 F.2d 619 (1969).

The defendants admit the binding effect of the easement granted Tenneco, the construction of a paved street passing over the plaintiff's buried pipeline, and the costs incurred in strengthening the pipe. Although conceding that the original installation did not satisfy the minimum safety requirements for lines under public streets, the defendants are silent as to the propriety of the operations undertaken by the plaintiff. Consequently, the court must determine (1) whether the protective measures were necessary; (2) the liability of the defendants for the costs of encasing the pipe.

The testimony at the hearing conducted on May 31, 1972, left scant doubt as to the necessity of securing the pipeline against the increased hazards attendant to highway traffic. Three Tenneco employees testified without contradiction that prevention of damage to the line commanded buttressment capable of withstanding the added pressure.

The easement granted in 1957 described land used for agricultural purposes and is silent regarding the issue in the case at bar. The proper construction of the grant must therefore reflect the general philosophy underlying this area of the law. Holbrook v. Hammond, 302 Ky. 10, 13, 192 S.W.2d 746 (1946). The holder of an easement enjoys not the land itself but merely an incorporeal right respecting the property.

"It is ancient law that nothing passes under an easement but what is necessary for its reasonable use and proper enjoyment. . . . `It is not necessary that the grantor should expressly reserve any right which he may exercise consistently with a fair enjoyment of the grant. Such rights remain with him, because they are not granted . . . .'" City of Williamstown v. Ruby, Ky., 336 S.W.2d 544, 546 (1960).

At the same time, the grantee as owner of the dominant estate is entitled to the "free and unrestricted use of the passway . . ." Sandman v. Highland, 312 Ky. 128, 132, 226 S.W.2d 766, 768 (1950); although the easement must impose the least possible burden, the servient holder "has no right to use the land subject to the easement in such a manner as to interfere with the reasonable and prudent exercise and enjoyment of the easement by its owner." Horky v. Kentucky Utilities Company, Ky., 336 S.W.2d 588, 589 (1960). This court is of the opinion that the road construction and concomitant necessity of encasing the pipeline constituted an unreasonable interference with the dominant estate.

The few decisions addressing this question have intimated that the easement holder should not be required to bear the costs made necessary by the landowner's development of the surface for his own profit. In Potter v. Northern Natural Gas Co., 201 Kan. 528, 441 P.2d 802 (1968), a landowner undertaking commercial development sued to require a pipeline company to...