Railroad Issues

References

• Railroad Land John Foster, Fidelity National
• Railroad Law & Title Insurance Issues William H. Reetz, North American Title. WLTA Presentation 2015

Rails to Trails

A series of class action cases have tested whether the cessation of use of railroad tracks for railroad purposes and conversion to biking, hiking and recreational trails triggers a compensable taking. The issue turns in part on how the railroad right of way was acquired -- whether it was a purchase or grant in fee or an easement. That is often determined under the applicable law in effect at the time of the grant and whether the tracks were run through a portion of the "checkerboard" granted to the railroad, or an alternate section.

A number of cases, going up to the US Supreme Court have held that when a railroad track built on an easement is abandoned and converted in a rails to trails project, that triggers a compensable taking. Many class action firms are representing those interests.

• Staying on Track with Trains and Title Issues By Travis A. Beaton, Joanne Darcy Crum, and Kelly Quam
  • Marvin M. Brandt Revocable Trust v. U.S.
  • Rogers v. U.S. (FL S.Ct)
  • Partial List of Rails to Trails Cases

Railroad Law may Pre-empt Prescriptive Easements on Crossings

Plaintiff had been in open, continuous, adverse, notorious and actual use of the disputed area to provide daily access from its site by its employees, customers, vendors, distributors, delivery trucks, and any other vehicles or individuals accessing the site. Plaintiff's use of the disputed area had been adverse to any right, title and interest of Defendant. Hundreds of vehicles per day used the disputed area and have done so for at least the past forty years. Defendant, who owned part of the disputed area, suddenly barricaded it and demanded Plaintiff stop crossing that part. The inability of vehicles to continue to use Defendant’s property is causing substantial damage to Plaintiff's business and operations.

Plaintiff sought a temporary restraining order prohibiting the blockade, alleging it had acquired a prescriptive easement. Seems like no-brainer, right? The Federal District Court hearing the application denied the TRO because “Plaintiff has not shown a strong likelihood of success on the merits.” Defendant was CSX Transportation, Inc., and its property was used in connection with its rail operations. CSX was able to show that Plaintiff's claim for a prescriptive easement is preempted by the Interstate Commerce Commission Termination Act ("ICCTA"). Chefs’ Warehouse Midwest, LLC, v. CSX Transportation, Inc., Case No. 1:17-cv-00555 (U. S. D. C., S. D. Ohio, Western Division, Sept. 15, 2017).

The ICCTA grants the Surface Transportation Board exclusive jurisdiction over "transportation by rail carriers" and "the construction, acquisition, operation, abandonment, or discontinuance of spur, industrial, team, switching, or side tracks, or facilities,” even if the tracks are located entirely in one State. The remedies provided in the ICCTA preempt state law remedies. "Transportation" is defined in the Act includes all of the facilities, equipment, property, and instruments related to the movement of property by rail, regardless of ownership.

Comment: The ICCTA explicitly preempts specific state law sanctioned activities, while other actions, such as acquisition of prescriptive easements, can be preempted if they have the effect of “unreasonably burdening or interfering with rail transportation.” The question of whether a state law claim would "unreasonably interfere" with rail transportation requires a fact-specific, case-by-case determination. Although there are cases where preemption is not warranted, in Chefs’ Warehouse, CSX was able to show tractor trailers using the access area routinely come within four feet of the railroad track and impermissibly "foul" (interfere with) the track and that a signal cable was damaged by a tractor trailer using the access area.