As we reported this morning, earlier today the Federal Circuit decided Albright v. United States, a takings case we have been following because it attracted an amicus brief. Chief Judge Prost authored today’s unanimous panel opinion affirming the Court of Federal Claim’s conclusion that the federal government did not commit any taking under the Fifth Amendment. In particular, the courts agreed that, when the government converted a particular railroad line into a recreational trail, no taking occurred because at that time the plaintiffs-appellants did not have a property interest in the railroad line. Their predecessors-in-interest, the courts ruled, did not grant easements to the railroad line but, instead, “fee simple absolute title” ownership of the land in question. This is our opinion summary.
In this case, owners of land in Oregon asserted that the United States Surface Transportation Board violated the Takings Clause of the Fifth Amendment by converting a railway easement to a recreational trail. As mentioned, Chief Judge Prost authored today’s panel opinion. Judges Linn and Taranto joined Chief Judge Prost’s opinion. Chief Judge Prost explained the background of the case:
One hundred thirty-two deeds were initially at issue in the case. Twenty-six deeds remain at issue in this appeal. Appellants contend that “their predecessors-in-interest granted only easements to the railroad which terminated when the railroad became dormant” and, as a result, “conversion of the rail corridor gave rise to a” compensable Fifth Amendment taking. . . . In response, the government argued that there was no compensable taking because the deeds at issue “conveyed the property within the rail corridor to the railroads in fee simple absolute.” . . . The Court of Federal Claims agreed with the government, concluding on partial summary judgment that the twenty-six deeds at issue conveyed fee simple title to the railroad and that, therefore, no Fifth Amendment taking occurred.
The Federal Circuit reviewed the grant of summary judgment de novo.
The court explained that “the only issue on appeal is whether the twenty-six deeds at issue conveyed to the railroad an estate in fee simple absolute or an easement.” On the one hand, if the deeds conveyed an easement, then a valid takings claim might be possible. On the other hand, if the deeds conveyed a fee simple title to the land, then no valid taking claims would be possible.
To determine whether the deeds conveyed an easement or fee simple absolute title, the court applied Oregon law. In short, the court “agree[d] with the Court of Federal Claims that each of the twenty-six deeds conveyed fee simple title to the railroad and, accordingly, Appellants have no compensable Fifth Amendment takings claim relating to these deeds.”
Applying Oregon law, the court focused on the intention of the parties. Reviewing Oregon precedent, the court noted that the Oregon Supreme Court has stressed the importance of what the deed purports to convey, but it has indicated there is a “divergence of opinion” when the language merely references “the use or purpose to which the land is to be put.” One example of confusing language the Oregon courts have highlighted is the phrase “right of way.”
In this case, the Federal Circuit noted that, “[i]mportantly, the granting clauses of all twenty-six deeds at issue purport to convey land—not an easement, not a right of way, and not property for specified purposes.” While some of the deeds included the phrase “right of way,” the court noted, they “do so only in their descriptions of the property conveyed and only to describe the land itself, not to describe what was being conveyed.” Furthermore, while other deeds indicate that the right to operate a railroad is conveyed, “this language is clearly employed merely to confirm that the conveyance includes that right, not to limit the interest conveyed to that right.” Moreover, explained the court, “none of the deeds provide for a reverter or otherwise contain language limiting the use that the grantee could make of the land.”
In sum, . . . the granting clauses in all the deeds at issue here plainly purport to convey real property. And the deeds state that the property is conveyed to the grantee and its successors and assigns “forever.” The granting clauses do not purport to convey an easement, a right of way, or something else that would indicate an intent to convey an easement, such as property for specific purposes . . . . Nor do the deeds provide for reverter or otherwise limit the uses the grantee can make of the land. These observations strongly support the conclusion that the deeds transferred fee simple absolute title to the land.
After making these points, the Federal Circuit proceeded to reject several arguments made by the appellants. Use of the phrase “strip of land” did not change the court’s conclusion. Nor did the argument that the deeds did not describe the land with sufficient precision. Furthermore, according to the court, the deeds did not use “through” and “across” to limit what was conveyed. Nor was the court convinced that nominal consideration evidenced intention to convey only an easement: “Under these circumstances, reciting nominal consideration is insufficient to overcome the other factors supporting a determination that the deeds convey an estate in fee simple absolute.” Finally, the court rejected the argument that the deeds should be understood to convey an easement based on the idea that “each deed specifically states that the railroad had already surveyed and located a railway across the grantor’s land prior to executing the deed.” The court explained that the precedent relied upon by the appellants applied Vermont rather than Oregon law, and that anyway the Vermont Supreme Court has indicated a location survey does not automatically convert a subsequent fee-simple convenance into an easement.
As a result, the Federal Circuit affirmed the conclusion of the Court of Federal Claims that no taking occurred.