The Empire Dist. Electric Co. v. Gaar

• Decision Date: 13 July 2000
• Citation: The Empire Dist. Electric Co. v. Gaar, 26 S.W.3d 370 (Mo. App. 2000)
• Parties: (Mo.App. S.D. 2000) The Empire District Electric Company, Appellant, v. Lois M. Gaar, Respondent. 23242 0
• Court: Missouri Court of Appeals

26 S.W.3d 370 (Mo.App. S.D. 2000)

The Empire District Electric Company, Appellant, v. Lois M. Gaar, Respondent.

23242

Missouri Court of Appeals Southern District

07/13/2000

Appeal From: Circuit Court of Taney County, Hon. James L. Eiffert

Counsel for Appellant: John S. Dolence

Counsel for Respondent: Joel B. Laner

Opinion Summary: None

Prewitt, J., and Barney, J., concur.

Kerry L. Montgomery, Presiding Judge

This matter involves a disputed boundary line between two parcels of real property owned by The Empire District Electric Company (Appellant) and Lois M. Garr (Respondent) respectively. After a land survey revealed that the property boundaries overlapped, Appellant filed an action for ejectment against Respondent and requested the trial court to quiet title in its name. Respondent filed a counterclaim asserting that she acquired title to the property through adverse possession. Appellant contended that its land was given to a public use and therefore protected against adverse possession claims by section 516.090.¹ The trial court rejected Appellant's argument and vested title in Respondent. This appeal followed.

The parties presented the case to the trial court based upon a joint statement of facts. A brief recital of these facts is necessary to illuminate the issues on appeal.

In 1913, pursuant to an Act of Congress, the Ozark Power & Water Company constructed the Ozark Beach Hydroelectric Project (the Project) and created Lake Taneycomo in Taney County, Missouri. In order to construct and operate the Project, Ozark Power & Water Company obtained title to various tracts of real property along the lake's perimeter. On March 18, 1913, Ozark Power & Water Company obtained a parcel of land from Eliza J. Groves by warranty deed. A portion of this parcel is the subject of this case.

On April 14, 1927, Appellant acquired Ozark Power & Water Company and obtained title to all real property owned by the company in Taney County. Appellant is a Kansas corporation, authorized to do business in Missouri. It is a private, for-profit corporation whose common stock is publicly traded and held by various shareholders.

Appellant continues to operate the Project and has been licensed by the federal government to do so since 1958. The Federal Energy Regulatory Commission (FERC) licenses the Project "to further the public interest by meeting public needs including, but not limited to, the public supply of electricity, flood control, conservation efforts, and public recreation." FERC issued the most recent 30-year license in 1992.

The 1992 license states that the Project consists of "all lands, to the extent of the licensee's interest in those lands, enclosed by the project boundary." Although Appellant had not entered upon the property in question for the ten-year period prior to March 31, 1996, and it had no current plans to use the property in connection with the delivery of hydroelectric power, it included the property within the Project boundaries on all license applications.

In December of 1987, Respondent purchased the parcel of land abutting the portion of Appellant's land that is at issue. Respondent improved the property with a residence, garden, dock, and outbuildings. Although Respondent does not currently reside on the property, she leases it out and intends to use it to house missionaries. Respondent has paid the property tax assessment on the land since she purchased it.

In 1996, Appellant began negotiating with the Missouri Department of Conservation regarding a potential lease of a portion of its property for the development of a public access boat ramp. In April of that year, Appellant had the land surveyed. The survey revealed that the eastern boundary of the property described in Respondent's deed overlapped the western boundary of the property described in Appellant's deed. Consequently, Appellant filed an action for ejectment requesting to clarify the proper boundary lines of the parcels.

Thereafter, Respondent filed a counterclaim requesting the trial court to grant her title to the disputed portion of land based upon a claim of adverse possession. Appellant did not dispute that Respondent and her immediate predecessors in title had maintained actual, open, notorious, and exclusive possession under a claim of right for a continuous 10-year period ending on March 31, 1996. Instead, Appellant maintained that all property within the Project boundary was put to public use and therefore protected against Respondent's adverse possession claim by section 516.090, which provides that no statute of limitation shall extend to lands "given, granted, sequestered or appropriated to a public use."

The trial court held a hearing on the matter on August 16, 1999. The sole issue presented to the trial court was whether Respondent could adversely possess property included within the Project boundary. On August 24, 1999, the trial court issued Findings of Fact and Conclusions of Law determining that "the property claimed by [Appellant] has not been devoted to a public use." The trial court found that although the public derives an indirect benefit from Appellant's ability to generate electricity, this does not amount to a public use as contemplated by section 516.090. The trial court then concluded that the statute did not bar Respondent's adverse possession claim. The court subsequently entered a judgment dismissing Appellant's claim and quieting title in Respondent's name.

Appellant raises four points on appeal. Each point challenges the soundness of the trial court's determination that the subject property was not put to a public use and thereby protected by section 516.090. Appellate review of this court-tried case is governed by the principles set forth in Murphy v. Carron, 536 S.W.2d 30 (Mo.banc 1976). "The judgment of the trial court must be sustained unless it is without substantial evidentiary support, unless it is against the manifest weight of the evidence, or unless it erroneously declares or applies the law." Osage Water Co., v. Miller County Water Auth., Inc., 950 S.W.2d 569, 572 (Mo.App. 1997) (citing Murphy v. Carron at 32). This Court will defer to the trial court's findings of fact where the evidence is conflicting but not to its determinations of law. City of Kansas City v. Hon, 972 S.W.2d 407, 409 (Mo.App. 1998).

In Points I, III, and IV, Appellant raises the issue of federal preemption.² In each of these points, Appellant claims the Supremacy Clause of the United States Constitution preempted the trial court from concluding that the disputed property was not dedicated to a public use for the purposes of section 516.090 because the land falls within the Project boundary and FERC had already made a binding determination as to the public utility of the land.

The Supremacy Clause³ empowers the federal government to preempt state laws to the extent it believes that such action is necessary to achieve its purposes. Silvey v. Mallinckrodt, Inc., 976 S.W.2d 497, 498-99 (Mo.App. 1998). The law of preemption is well-settled:

[The federal government may preempt state laws] by federal statute or by federal regulations which have been properly adopted in accordance with statutory authorization. Thus, a federal agency acting within the scope of its congressionally delegated authority may preempt state law.

An agency's statutorily authorized regulations will preempt any state or local law that conflicts with those regulations or frustrates their purpose. In addition, in proper circumstances, an agency may determine that its authority is exclusive and preempt any state efforts to regulate in the forbidden area. When determining whether an agency regulation preempted state law, we must look at 1) whether the agency intended to preempt state law and 2) whether Congress authorized the agency to preempt state law.Id. at 499 (citations omitted).

In its first point on appeal, Appellant contends that the trial court erred in finding the property had not been devoted to public use because FERC, "through its extensive licensing procedure mandated by the Federal Power Act, has determined the entire Project, including the subject property, serves the public interest." Appellant suggests that FERC's decision to issue the license amounted to a final and binding determination as to the "public utility" of the land. Appellant argues that under the Supremacy Clause of the United States Constitution the trial court was preempted from making its independent finding that the land was not put to a "public use" as contemplated by section 516.090.

Appellant fails to cite, and our research failed to reveal, any cases in support of its proposition that the mere issuance of an operating license by FERC bound the trial court to apply section 516.090 to the property at issue. Appellant notes that FERC has issued orders that broadly define the public interest under the Federal Power Act to include "the protection of fish and wildlife and their habitat, the development of public recreation and project reservoirs, and the preservation of environmental amenities." Public Utility District No. 1 of Lewis County, Washington, 80 FERC 61,350, page 7, FERC Records & Information Management System (Sept. 25, 1997). Appellant equates a determination that a project is in the "public interest" in the context of FERC's licensing procedures with "public use" for the purposes of section 516.090.

Appellant concludes that prior to issuing the 1992 license, FERC assessed all land included within the boundaries of the Project in the license application and determined the public necessity and utility of the entire area, "not just the electrical facilities within the Project." This contention ignores the language in section 796(11) of the Federal Power Act that defines a "project" to include only "lands or interests in lands the use and occupancy of which are necessary or appropriate in the maintenance and operation of such unit." (...