Bhl Properties, LLC v. United States, 15-179

Background

Soo Line Railroad filed for exempt abandonment of a Racine County, WI corridor in Jan 2014; the STB granted abandonment authority and, after the Wisconsin DNR sought interim trail use, issued a NITU in March 2014 permitting negotiations for rail-banking/trail use.
The NITU has been extended repeatedly and remained effective while parties negotiated a trail-use agreement.
Multiple landowners sued the United States in the Court of Federal Claims alleging the NITU effected a Fifth Amendment taking of state-law reversionary or adjacent property interests; most plaintiffs later dismissed their claims, leaving only Dennis Lee.
Lee owns a two-acre parcel that terminates at Durand Avenue (Highway 11), which lies between his parcel and the railroad corridor; he argues he also owns the land under Durand Avenue (subject to a county easement) and therefore is the presumptive owner of the land underlying the railroad corridor.
The government disputed Lee’s ownership of the land under Durand Avenue and revoked most title stipulations; the record contains Lee’s deeds describing his parcel by metes and bounds that do not include Durand Avenue and a 1926 deed from an earlier owner to Racine County for a highway easement, but no chain of title linking Lee to the land beneath Durand Avenue.
The Court held Lee bears the burden to prove he owns the land abutting the corridor; because he failed to produce evidence showing ownership of the land under Durand Avenue (or a chain of title from the 1926 grant), the Court granted the government summary judgment and denied Lee partial summary judgment.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether issuance of the NITU effected a compensable taking under the Trails Act for Lee	Lee contends he owns land under Durand Ave and thus is the adjacent landowner whose state-law reversionary interest is blocked by the NITU, creating a taking	Government argues Lee has not shown ownership of land under Durand Ave and so has no burdened or adjacent property interest to be taken	Court held no taking because Lee failed to prove ownership of land under Durand Ave; granted gov’t summary judgment
Whether the presumption that an abutting owner holds title to a highway centerline helps Lee	Lee invokes Wisconsin presumption that abutting owner holds title to centerline of adjacent highway	Government notes even if Lee owned to the centerline, he would not own the far side of Durand Ave and thus would not abut the rail corridor	Court held the presumption, even if applied, does not establish ownership of the portion of Durand Ave needed to make Lee adjacent to the corridor
Whether deeds and maps submitted suffice to establish chain of title to the land under Durand Ave	Lee points to his recorded deeds describing his two-acre parcel and an expert map showing his parcel ends at Durand Ave	Government points to deed language and absence of any conveyance linking Lee to land underlying Durand Ave; stresses Lee bears burden to prove ownership	Court held the deeds’ metes-and-bounds descriptions exclude Durand Ave and no chain of title was shown; evidence insufficient
Whether summary judgment was appropriate	Lee argued government’s revocation of stipulations should not bar him and that factual disputes remain	Government argued Lee lacked essential title evidence and so cannot meet an essential element of his takings claim	Court found no genuine issue of material fact on title for Lee’s claim and granted government summary judgment

Key Cases Cited

Preseault v. Interstate Commerce Comm’n, 494 U.S. 1 (1990) (Trails Act authorizes interim trail use; framework for rails-to-trails takings)
Preseault v. United States, 100 F.3d 1525 (Fed. Cir. 1996) (describing property-interest analysis when easements terminate and adjacent owners’ interests vest)
Caldwell v. United States, 391 F.3d 1226 (Fed. Cir. 2004) (STB’s NITU can effect compensable taking by blocking state-law reversionary interests)
Rogers v. United States, 814 F.3d 1299 (Fed. Cir. 2015) (government must provide compensation if NITU results in taking of private property)
Ladd v. United States, 630 F.3d 1015 (Fed. Cir. 2010) (rails-to-trails takings and analysis of easement termination)
Yee v. City of Escondido, 503 U.S. 519 (1992) (physical occupation by government requires compensation)
Nollan v. California Coastal Comm’n, 483 U.S. 825 (1987) (appropriation of a public easement across private land constitutes a taking)
Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419 (1982) (permanent physical occupation is a taking)
Barclay v. United States, 443 F.3d 1368 (Fed. Cir. 2006) (STB abandonment procedures and ownership analysis)
Pollnow v. State Dep’t of Nat. Res., 276 N.W.2d 738 (Wis. 1979) (upon abandonment of easement, land reverts to abutting owners; title presumed in abutting owners in absence of contrary evidence)