Opinion
C.A. No.: 98C-09-079-FSS.
Submitted: August 31, 2000.
Decided: November 29, 2000.
Upon Defendant's Motion In Limine DENIED
Somers S. Price, Jr., Esquire, Todd L. Goodman, Esquire and Michael B. Miller, Esquire, Potter Anderson Corroon, LLP, Hercules Plaza, 1313 North Market Street, Wilmington, Delaware, 19801. Attorneys for Plaintiff.
William D. Bailey, Jr., Esquire, 222 Delaware Avenue, Suite 900, P.O. Box 25130, Wilmington, Delaware, 19899. Attorney for Defendant.
OPINION and ORDER
This is a condemnation by an electric utility that falls squarely under 26 Del. C. § 908. It follows the property owner's victory in a trespass case in the Court of Chancery. Until the property owner brought suit and forced the issue, the utility incorrectly assumed that it had a valid easement from a railroad that owned a right of way across the property. For decades the utility maintained and serviced electric distribution facilities on the property. As it turned out and as discussed below, the Court of Chancery determined that the utility's easement was defective. Accordingly, in order to establish a valid easement, the utility filed this condemnation proceeding. Now, before the trial on the easement's value, the Court must decide when the utility actually took possession.
I.
In order to decide when the utility took its easement from the property owner, it is necessary to know something about the history of the subject parcel and the easement. The Chancery Court's decision extensively discusses the utility's and the property owner's respective claims to the land and the easement.
Forwvood v. Delmarva Power and Light Co., Del. Ch., C.A. No. 10948, Lamb, V.C. (Mar. 16, 1998) (Mem. Op.).
In summary, Delmarva Power Light Company decided to build and maintain electric service facilities near Rockland Road outside Wilmington in 1935. The utility followed the well-known practice of locating its transmission lines and other distribution facilities along an existing railroad right of way, more or less. Instead of acquiring an easement from the owner of the fee, the utility merely obtained the railroad's permission to use the railroad right of way. The record does not disclose the financial arrangements, if any, between the railroad and the utility. In any event, from 1935 through 1957, the utility expanded its distribution facilities along the right of way. The utility rewired, added a line and replaced its poles with taller ones.
On June 6, 1960, the property owner acquired fee simple title to the land. When the property owner took, the railroad was using the right of way and the utility's distribution facilities were obvious. Apparently, the relationship between the property owner and the utility was uneventful until the railroad abandoned its right of way in 1976. There was no strife for several years after that. Prom time-to-time, the utility's linemen entered onto the land in order to maintain the utility's lines and poles. The property owner testified: "[I]f they were linemen and wanted permission to come; there was never a refusal." On one or two occasions, the utility did tree trimming. Also, in 1979 a surveying crew, which presumably was associated with the utility, entered the land and completed work, with the property owner's tacit permission.
While the property owner tolerated the utility's linemen, its tree trimming crews and engineers allegedly caused problems. At some point, two engineers crossed the property in order to get to the power lines. They did that after the property owner refused to give them permission to come onto the land. At another time, tree trimmers "knocked down a couple of trees, an apple tree and pear tree. . . ."
By 1984, relations between the utility and the property owner had begun to sour noticeably. At that time, a representative of the utility allegedly trespassed on the land and destroyed fruit trees that the property owner valued sentimentally. On another occasion in 1991, after the Chancery case was under way, the utility entered the land with a bulldozer, escorted by police officers armed with rifles. Then the utility destroyed established trees, which presumably were interfering with the utility's equipment.
By 1988 the utility's customers who were served by the distribution facilities on the disputed property were experiencing frequent power outages. Moreover, a condominium was being built nearby. The utility announced plans to expand its service and bury its lines. It tried unsuccessfully to reach an accord. After meeting with the property owner, the utility sent a letter dated May 27, 1988. In the letter, the utility requested the property owner's consent to the proposed work and the utility also asserted, "[W]e believe we have sufficient rights to complete this project within the rail bed."
On September 30, 1988, the property owner formally refused to agree to the utility project and the property owner promised litigation "to bring your claim against our property into a legal clarification." Despite the property owner's written protest, in December 1988 the utility began extensive work on its distribution facilities. The work took approximately six weeks, ending in January 1989. The utility claims that it did the work without entering the property owner's land, but the die was cast.
The property owner filed suit in June 1989 to enjoin the utility from trespassing on the land. As presented above, the Court of Chancery eventually decided the parties' respective interests on March 16, 1998 and that litigation ended when the Court of Chancery issued an order on July 14, 1998. The Court of Chancery enjoined the utility "from continuing to tresspass upon the land . . .," but the court gave the utility a grace period for filing a condemnation action under 29 Del. C. § 908, which was enacted for situations like this one. Hence, the utility filed its complaint here on September 11, 1998.
Forwood v. Delmarva Power and Light Co., Del. Ch., C.A. No. 10948, Lamb, V.C. (July 14, 1998) (ORDER).
II.
For present purposes, the utility concedes that the property owner holds unburdened title to the land. And the property owner concedes the utility's statutory authority to condemn the easement. Everyone agrees that under this case's unusual circumstances, where the land was burdened before the condemnation was started, the date of the taking will serve as the date of valuation.
The property owner argues that the date of the taking is December 5, 1988, when the utility "sought by positive action [the utility construction] to assert `dominion' over the Forewood property. . . ." The property owner contends that the utility's "invasion, to permanently install equipment" in 1988 amounted to a de facto taking. The utility does not dispute the events in 1988, but the utility contends that by then it already was in possession and it had taken its easement. According to the utility, a de facto taking occurred at the moment the utility's license expired in 1976 and the utility's distribution facilities remained on the property nevertheless.
III.
In terms of their positions on the law, the parties are not far apart. They effectively discount and distinguish each other's lead cases, but fundamentally they agree as a matter of law that the taking occurred when the utility dispossessed the property owner. They also agree about the basic facts. As presented above, the dispute is over the point at which the utility entered into possession. The Court can resolve that issue as a matter of law, from the undisputed facts.
Danforth v. United States, 308 U.S. 271, 284 (1939); cited in State v. Gabor, Del. Super., C.A. No. 94C-06-256, Quillen, J. (Dec. 31, 1996) (Letter Op. and Order); See also State v. Rehoboth Market Place Assoc., Del. Super., C.A. No. 89C-SE-35, Lee, J., (Feb. 26, 1992) (Mem. Op.).
IV.
The Court appreciates the fact that the property owner always permitted the utility's linemen to enter the land. The Court further appreciates the fact that the utility's tree trimmers, surveyors and engineers only entered the land occasionally, with or without permission. Moreover, the Court recognizes that the utility "rearranged" its distribution facilities in 1988. Nevertheless, the land was burdened by the utility since long before the property owner acquired title in 1960. The distribution facilities were intrusive and permanent.
According to the Court of Chancery, after the railroad left, "Delmarva's continued presence became adverse to Mrs. Forward's interest as owner of the land." The factual underpinnings for the Court of Chancery's holding are apparent. The property owner cannot back away now from their implications. The utility was in possession under a license in 1960. Although the utility lost its license in 1976, its use of the land did not change. Moreover, the utility never doubted its right to use the land for the utility's purposes. What happened in 1988-1989 was less a function of the utility's trying to increase its claim and take something new from the property owner. It was more a case of the property owner's finally asserting her rights and attempting to clear the air. In short, the Court agrees with the utility that the utility took possession of the land in 1976.
V.
Finally, based on the parties' positions and the generally appreciating real estate market in New Castle County, the Court assumes that the easement has become more valuable over time and an earlier date of taking means a lower value for the easement. If that is what this decision means, that result is not unfair. As condemnations go, this case is anomalous. The condemnor usually files suit before taking possession. And the law of eminent domain is concerned that the condemnor should not benefit from taking first and filing suit later. In this situation, however, the utility behaved reasonably. It had been using the land for 25 years before the property owner took title. When the property owner bought the property, the utility's encroachment was open and obvious. For sixteen years after the property owner took title, the utility used the land constantly. Even after the railroad pulled up its track, the utility used the land for 12 more years before the property owner filed suit. The property owner had to contend with the utility from the moment the property owner acquired title and for the next 28 years.
See 4 Nichols on Eminent Domain § 12A.04-.05 (3d ed. 1998); See also Uniform Eminent Domain Code § 1003(b)(3) (1974).
But for the railroad's unanticipated demise, the utility still would be maintaining its facilities along the rail bed and the property owner would be entitled to nothing. It is hard to believe that the property owner paid much, if anything, for the reversionary interest in the railroad right of way, including the utility's license. It appears that the property owner is reaping a windfall occasioned by the utility's mistake when the utility acquired a license from the railroad instead of an easement from the holder of record in 1935. For its old mistake the utility now must pay. But the Court must adopt a date of valuation that is fair. In that regard, the Court is mindful of 10 Del. C. § 6113.
10 Del. C. § 6113 ("Interest shall accrue on the award from the date of taking possession or from the date of the award, whichever first occurs.")