March 28, 2014
The U.S. Supreme Court’s recent decision in Marvin M. Brandt Revocable Trust v. U.S. (2014 WL 901843) resolves an issue, nearly 150 years in the making, which affects not only those whose property is encumbered by a railroad right-of-way, but also those who enjoy (or were planning to enjoy) its benefits.
In the latter half of the 19th century, as railways began to stretch westwards across the United States, the federal government sought to encourage this expansion by making it easier for railroads to gain legal access to the required land. This happened in roughly three different ways during three different periods. Prior to 1871, the railroads were granted land outright, often with additional land subsidies for infrastructure development. Between 1871 and 1875, the federal government used piecemeal legislation to grant designated railroads “’the right of way’ through public lands, but without any accompanying land subsidy.” Id. Finally, the General Railroad Right-of-Way Act of 1875 (43 U.S.C. § 934) was passed. This Act was designed to be a more permanent solution to providing railroad companies rights-of-way through public lands, but did not contain specific instructions for the fate of the land once the railroad no longer used it.
It’s well-settled that “a right of way granted to a railroad by a pre–1871 Act of Congress included ‘an implied condition of reverter’ to the Government if the right of way ceased to be used ‘for the purpose for which it was granted.’” Brandt (quoting Northern Pacific R. Co. v. Townsend, 190 U.S. 267, 271, 23 S.Ct. 671, 47 L.Ed. 1044 (1903)). Additionally, in 1915, the Court found an implied condition of reverter in land grants made under the General Railroad Right-of-Way Act. Rio Grande Western R. Co. v. Stringham, 239 U.S. 44, 47, 36 S.Ct. 5, 60 L.Ed. 136 (1915). Consequently, the federal government’s claim on former railroad land appeared undisputed. A solid body of state and federal case law developed holding that when a right-of-way under the General Railroad Right-of-Way Act was no longer in use as a railroad, the Federal Government retained a property interest in the land. Mauler v. Bayfield County, 309 F.3d 997, 999 (7th Cir.2002); Vieux v. East Bay Reg’l Park Dist., 906 F.2d 1330, 1335 (9th Cir.); Marshall v. Chicago and Northwestern Transportation Company, 31 F.3d 1028 (10th Cir.1994); Barney v. Burlington N. R.R. Co., 490 N.W.2d 726, 731 (S.D.1992).
Since the early 1980s, much of the land granted under the General Railroad Right-of-Way Act was converted into recreational trails for hikers and cyclists pursuant to the National Trails System Act Amendments of 1983, which amended the National Trails System Act (16 U.S.C. § 1241 et seq.). See Preseault v. I.C.C., 494 U.S. 1, 110 S. Ct. 914, 108 L. Ed. 2d 1 (1990). Commonly referred to as “rails-to-trails,” this act takes advantage of the long stretches of perfectly graded land upon which the railway lines once sat.
In 2005 however, the United States Court of Federal Claims held that “[t]he federal government had ample opportunity to preserve a reversionary interest in the right-of-way granted to railroad companies under the 1875 Act, but failed to do so.” Beres v. U.S., 64 Fed.Cl. 403, 428 (Fed.Cl. 2005). This signaled trouble for “rails-to-trails” conversions and a victory for private land-owners seeking compensation for what they perceived as an uncompensated taking following the abandonment of a railway through their property.
In Brandt, the U.S. Supreme Court has seconded the holding in Beres, finding that land granted under the General Railroad Right-of-Way Act was merely an easement. Accordingly, the United States retains no reversionary interest in the land and the easement simply terminates upon abandonment. Although this may not end rails to trails conversions, it will certainly significantly increase their cost, as the land (or at least a new easement) will need to be purchased from myriad private owners along the length of the trail.