Opinion
No. ED 86292
March 28, 2006
Appeal from the Circuit Court of St. Louis County, Hon. Robert S. Cohen.
Earl Robert Schultz III, Carl B. Hillemann III — co-counsel, Chesterfield, Missouri, Barry Sullivan — co-counsel, Gabrielle Sigel — co-counsel, Chicago, Illinois, Attorneys for City of Bridgeton.
Carl Joseph Pesce, Paul David Lawrence III — co-counsel, St. Louis, Missouri, Attorneys for Missouri-American Water Company.
James Patrick Gamble, St. Louis, Missouri, Attorney for Missouri Growth Association.
Michael F. Barnes, St. Louis, Missouri, Attorney for Union Electric Company.
Suzanne Montgomery, St. Louis, Missouri, Attorney for Southwestern Bell Telephone, L.P.
David P. Abernathy, St. Louis, Missouri, Attorney for Laclede Gas Company.
Randy Edgar Hayman, Jefferson City, Missouri, Attorney for Metropolitan St. Louis Sewer District.
Before Nannette A. Baker, Presiding Judge (Sat), Robert G. Dowd, Jr., Judge (Sat), Sherri B. Sullivan, Judge (Writer).
Introduction
The City of Bridgeton (Bridgeton) appeals from the summary judgment entered by the trial court in favor of Missouri-American Water Co. (Missouri-American) on Bridgeton's claims of trespass and ejectment, and denying Bridgeton's request for injunctive and other appropriate relief. We affirm.
Factual and Procedural Background
In 1951, Bridgeton entered into a 20-year franchise agreement with Missouri-American's predecessor to lay and maintain water mains, pipes and fire hydrants within Bridgeton's city limits. In 1956, Bridgeton annexed the area that included Taussig Road. It is undisputed that Taussig Road is located in the public right-of-way.
In 1998 and 1999, TriSTAR Business Communities, LLC (TriSTAR) was developing "Park 370," an industrial park in Hazelwood. To improve access to Park 370, TriSTAR wanted to build an interchange on Route 370, and thus sought Bridgeton's permission to make improvements at Route 370 near its intersection with Missouri Bottom and Taussig Roads. Bridgeton granted approval, subject to the condition that TriSTAR agree to finance improvements to Taussig Road. To secure Bridgeton's approval for its own project, TriSTAR agreed to provide financing for Bridgeton's improvements to Taussig Road.
Most of the Missouri Bottom Road/Route 370 project was to be located in Hazelwood, but part of it would be within Bridgeton city limits.
Missouri-American determined that the Taussig Road project would require the relocation of some pipe sections and hydrants, and told Bridgeton that it would cost $500,000.00 to perform the task. Bridgeton refused to pay Missouri-American for the relocation, and brought a lawsuit against Missouri-American, alleging trespass and seeking ejectment. The trial court granted summary judgment in favor of Missouri-American. This appeal follows.
Standard of Review
Our review of the trial court's grant of summary judgment is essentially de novo. ITT Commercial Fin. Corp. v. Mid-Am. Marine Supply Corp., 854 S.W.2d 371, 376 (Mo. banc 1993). The propriety of summary judgment is purely an issue of law. Id. We need not defer to the trial court's order, as its judgment is founded on the record submitted and the law. Id. The criteria on appeal for testing the propriety of summary judgment are no different from those which should be used by the trial court to determine the propriety of sustaining the motion initially. Id. Summary judgment is proper only in those situations in which the movant can establish that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law. Id. at 377.
Points Relied On
In its first point, Bridgeton maintains that the trial court erred in granting summary judgment in favor of Missouri-American because the court incorrectly found applicable to this case the exception recognized by this Court's decision in Home Builders Ass'n of Greater St. Louis v. St. Louis County Water Co., 784 S.W.2d 287 (Mo.App.E.D. 1989), to a utility's common-law duty to pay to move its facilities for road improvements like Bridgeton's Taussig Road Project, in that: (1) the Home Builders exception to the common-law rule applies only where road projects are undertaken by private developers, not governmental bodies, as is the case here; (2) under the common-law rule, Missouri-American must pay to relocate its facilities because Bridgeton is exercising a governmental, rather than proprietary, function in undertaking to repair and to improve Taussig Road; and (3) even under the exception to the common-law rule recognized in Home Builders, Missouri-American must pay to relocate its facilities because the Taussig Road Project overwhelmingly benefits the public and affords virtually no private benefit to TRiSTAR.
Discussion
The common-law rule in Missouri is that a utility company must relocate its facilities in public streets at its own expense when changes are required by public necessity, or public convenience and security require it. Home Builders, 784 S.W.2d at 289. However, this general rule is inapplicable when the relocation of its facilities has been necessitated by the municipality's exercise of a proprietary rather than a governmental function or purpose. Id. In Home Builders, five real estate developers were required, by the appropriate governmental authorities, to complete certain roadway improvements associated with their particular projects as a condition to obtaining permission to construct those projects. These improvements required the relocation of facilities owned and operated by the water company in the public right-of-way. The water company refused to relocate its right-of-way facilities unless compensated by a developer. The developers filed a declaratory judgment action against the water company to determine whether each individual developer or the water company was responsible for the cost of relocating the facilities.
This Court held that if the project necessitating the right-of-way improvement does not involve a governmental act, or if the governmental act is the development of a project for which the purpose is proprietary rather than governmental, the general rule does not apply. Id. at 290.
In the instant case, an initial cursory examination indicates that the purpose of the improvements to Taussig Road is governmental, in that the improvements are necessary for the safety and benefit of the public. Further, it appears that TriSTAR's development in itself does not necessitate the improvements to Taussig Road. Rather, improvements to Taussig Road have been necessary and contemplated by Bridgeton for some time before TriSTAR's proposed development. If our analysis ended there, then Missouri-American would clearly be responsible for the costs of relocating the pipes and hydrants.
However, a more comprehensive analysis of the situation before us takes into account that an exaction was made by Bridgeton on TriSTAR, a private developer, to improve Taussig Road as a condition for Bridgeton's approval of TriSTAR's Route 370 project. Not only did this exaction tie TriSTAR's project to the Taussig Road project in such a manner that realization of the former was contingent upon the accomplishment of the latter, but it also invokes the necessity of a cost-benefit analysis.
Although the general public benefits from the improvements to Taussig Road, these benefits are incidental. The primary beneficiary of the work is TriSTAR, which would not have been permitted to pursue its project without agreeing to perform the improvements. Since TriSTAR "presumably enjoys the economic opportunity that the development represents, it seems proper that it should also bear the attendant costs." Pacific Gas Electric Co. v. Dame Construction Co., 191 Cal. App. 3d 233, 240 (1987).
Furthermore, TriSTAR clearly contemplated its responsibility for relocating the water facilities, as Paragraph 8A of its contract with Bridgeton, under a section called "Project Costs," provides that TriSTAR will pay for any utility relocation "not paid by the utility involved." In planning its development and the attendant costs, TriSTAR obviously not only had the ability to take the utility relocation costs at issue into account, but in fact did, as is evidenced by the aforementioned contractual language. Developers have a better opportunity than utilities such as the water company to anticipate and to plan for the costs of relocation associated with their proposed projects. Home Builders, 784 S.W.2d at 293.
Based on the foregoing, we reject Bridgeton's argument that Missouri-American must pay to relocate its facilities because the Taussig Road Project overwhelmingly benefits the public and affords virtually no private benefit to TRiSTAR, and find, on the contrary, that not only does the Taussig Road Project primarily benefit TriSTAR, but also that Bridgeton contemplated in its agreement with TriSTAR that TriSTAR would bear responsibility for the costs of the utility relocation.
Accordingly, Point I is denied.
In its second point, Bridgeton claims that the trial court erred in granting summary judgment in favor of Missouri-American for the independent reason that Missouri-American did not prove that it has a valid right to occupy the Taussig Road right-of-way in the first instance, in that: (1) the grounds offered by the trial court are insufficient to show such a right as a matter of law; (2) the 1902 County Franchise upon which Missouri-American relies could not grant the utility a right to occupy a right-of-way that belonged to Bridgeton, rather than to the County, at the time the pipes were first installed; (3) if any such right ever had existed, it would have expired during the 60 years between the grant of the County Franchise and the first installation of pipes along Taussig Road; and (4) even the County Franchise requires by its terms that the utility pay to relocate its facilities whenever the relevant governmental unit determines — in its sole discretion — that such relocations are necessary.
Discussion
Missouri-American and its predecessors have existed as public utilities in St. Louis County for over 100 years. In 1901, Missouri's General Assembly gave circuit courts of Missouri counties the power to authorize utility companies to lay and maintain facilities on public roads. These grants of power to public utilities are known as franchises. In 1902, Missouri-American's predecessor obtained a perpetual franchise from St. Louis County, granted by court order, to lay and maintain its water main and pipes across the public highways of St. Louis County. Home Builders, 784 S.W.2d at 287. This franchise was granted to Missouri-American's predecessor and its successors and assigns. At that time, Taussig Road was in an unincorporated area of St. Louis County, which was later annexed by Bridgeton in 1956.
Today, this power is exercised and governed by the Missouri Public Service Commission. See, Ogg v. Mediacom, L.L.C., 142 S.W.3d 801, 813 (Mo.App.W.D. 2004).
Bridgeton argues that its annexation of Taussig Road after the grant of the franchise, and the fact that Missouri-American's predecessor did not lay any pipes under Taussig Road prior to Bridgeton's annexation of it, inexorably lead to the conclusion that Missouri-American does not have the right to occupy the Taussig Road right-of-way.
On the contrary, Taussig Road still falls within the scope of Missouri-American's franchise even though it was later annexed by Bridgeton. Bridgeton's annexation of the area did not affect Missouri-American's predecessor's right and power as a franchise to furnish services in the area. See Missouri Public Service Comm'n v. Platte-Clay Elec. Coop., Inc., 407 S.W.2d 883, 889 (Mo. 1966). Missouri-American's predecessor also did not have to actually lay pipes under Taussig Road before Bridgeton annexed it to claim its franchise as to that particular area. See Russell v. Sebastian, 233 U.S. 195, 207 (1914).
Bridgeton contends that the 1902 franchise is not perpetual because it does not contain a specified duration. However, the grant of a franchise that does not specify a period of duration is a grant in perpetuity. Platte-Clay, 407 S.W.2d at 889. Furthermore, Bridgeton's contention contradicts this Court's classification of the 1902 franchise: "The Water Company accepted and holds a perpetual franchise granted in 1902 by court order from St. Louis County, giving it the right to lay and maintain its water main and pipes across the public highways of St. Louis County." Home Builders, 784 S.W.2d at 287.
We find that Missouri-American has a valid right to occupy the Taussig Road right of way.
For the foregoing reasons, Point II is denied.
In its third point, Bridgeton argues that the trial court erred in granting summary judgment in favor of Missouri-American with respect to facilities located on formerly private property because the record shows that Missouri-American is required to relocate those facilities, in that Bridgeton has title to the property and has exercised its common-law and contractual rights to revoke Missouri-American's authority to occupy that property.
Discussion
Bridgeton maintains that the trial court did not address the issue of whether Missouri-American must pay to relocate those facilities that are located on property that was private property before Bridgeton acquired it for the Taussig Road project. Specifically, Bridgeton posits that Missouri-American has to pay to relocate facilities (1) located pursuant to the so-called "License for Underground Facilities" granted by Norfolk Western Railway Company (Norfolk) in 1967 (1967 License), and (2) located on the property without either an easement or a license.
As for its first position, Bridgeton maintains that it is Norfolk's successor pursuant to the terms of the 1967 License and has the power to order Missouri-American to pay for the relocation of the particular pipes and such in the confines of the area governed by the 1967 License. As for its second position, Bridgeton claims that a significant portion of at least one pipe section that must be relocated is on private property now belonging to Bridgeton, but not covered by any easement or license. Bridgeton asserts that it has the right to order Missouri-American to relocate facilities in that property at Missouri-American's own expense.
Bridgeton concedes that Missouri-American must be compensated for the cost of relocating facilities located within written easements on said property. The 1967 License provides that Norfolk grants Missouri-American permission to construct, operate, use, maintain, or remove a 20-inch pipe line, for the handling of water over the Norfolk property. Although this contract was titled "License for Underground Facility," it operates as and is worded like an easement and it therefore is one. Missouri law recognizes that some "licenses" are in fact easements. See Annin v. Lake Montowese Dev. Co., Inc., 759 S.W.2d 240, 241 (Mo.App. 1988). A true license only grants the licensee the privilege to go onto premises for a certain purpose, and does not vest in the licensee any title, interest or estate.Id. The 1967 License, in contrast, says that it inures to the benefit of and is binding on the "successors and assigns of the parties thereto, respectively." This language clearly indicates an intent for the privileges conveyed therein to run with the land like an easement. Missouri law will treat a "license" that operates like an easement as an easement. Annin, supra.
Further, we note that there is no reservation of power to terminate Missouri-American's privileges in the 1967 License, nor is there a provision for termination, and Missouri-American paid valuable consideration to Norfolk to exercise its privileges under the agreement in a series of acts over time. All of these factors are indications that the 1967 License is in actuality, an easement. See Wilson v. Owen, 261 S.W.2d 19, 23-24 (Mo. 1953). As such, Missouri-American is not obligated to pay for the relocation of its facilities in this area.
As for the area with allegedly no easement, Bridgeton has presented insufficient evidence to demonstrate that Missouri-American's pipe is illegally present there.
For the foregoing reasons, Point III is denied.
The judgment of the trial court is affirmed.
Nannette A. Baker, P.J. and Robert G. Dowd, Jr., J., concur.