892 F.3d 1164
Fed. Cir.2018Background
- This is a rails-to-trails takings suit: Chicago Coating Co. and Ignacio & Benjamin Martinez sued the United States claiming the STB’s issuance of a Notice of Interim Trail Use (NITU) effected a Fifth Amendment taking of their alleged reversionary interests in former railroad corridor parcels in Cook County, Illinois.
- BNSF initiated abandonment/exemption proceedings in 2012–2013; the Chicago Department of Transportation sought interim trail use; the STB issued an NITU in April 2013 and extensions followed while no railbanking agreement was finalized.
- Appellants trace title to two 19th-century deeds: the Jones Deed (1878 quitclaim language referencing “right of way…for railroad purposes” and a right of reentry and homestead waiver) and the Wilkins Deed (1875 warranty-form conveyance of “a strip of land…so long as…used…for the purpose of a railroad” with an express reconveyance condition).
- The trial court granted summary judgment to the Government, concluding both deeds conveyed fee simple title (not mere easements), so no compensable property interest existed and no taking occurred.
- On appeal the Federal Circuit reviewed de novo whether, under Illinois law, the deed language created fee simple title or a limited easement and affirmed the trial court: both instruments conveyed fee simple.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Jones Deed conveyed fee simple or an easement | Jones deed’s references to “right of way,” “for railroad purposes,” and "over and across" show intent to grant only an easement that would revert on nonuse | Statutory quitclaim form, language conveying “all interest,” homestead-waiver, and overall deed language show fee simple conveyance | Fee simple: statutory form and homestead waiver, plus the instrument read as a whole, indicate fee simple conveyance |
| Whether Wilkins Deed conveyed fee simple or an easement | Phrase “so long as…used…for the purpose of a railroad” limits conveyance to an easement | Statutory warranty form and explicit conveyance of “a strip of land” with no limiting grant language show fee simple; reconveyance clause consistent with fee | Fee simple: statutory warranty form and clear object (“strip of land”) support fee simple conveyance |
| Whether issuance of NITU effected a compensable taking | If Appellants hold reversionary easements, NITU (railbanking) eliminates state-law reversion and effects a taking | No compensable taking because Appellants hold no cognizable easement or reversionary interest; title is fee simple in railroad/grantee | No taking: because deeds conveyed fee simple, plaintiffs lack compensable property interest |
| Proper law and standard for resolving deed interpretation | Illinois property law governs; intent of parties from instrument controls; summary judgment proper if no material factual dispute on intent | Same; statute-presumptions from deed forms apply; resolve as matter of law on undisputed documents | Applied Illinois law and deed-form presumptions; summary judgment appropriate where deed language unambiguous |
Key Cases Cited
- Preseault v. Interstate Commerce Comm’n, 494 U.S. 1 (1990) (railbanking and NITU can give rise to a Fifth Amendment takings claim)
- Preseault v. United States, 100 F.3d 1525 (Fed. Cir. 1996) (en banc) (rails-to-trails takings framework and inquiry whether original deed created an easement)
- Ellamae Phillips Co. v. United States, 564 F.3d 1367 (Fed. Cir. 2009) (three-part test for rails-to-trails takings: ownership, scope, and prior termination/abandonment)
- Urbaitis v. Commonwealth Edison Co., 575 N.E.2d 548 (Ill. 1991) (statutory deed form presumption of fee and construing purpose language as descriptive, not limiting)
- Sowers v. Illinois Central Gulf R. Co., 503 N.E.2d 1082 (Ill. App. Ct. 1986) (language locating a railroad does not necessarily limit estate to an easement)
- Tallman v. E. Ill. & Peoria R. Co., 41 N.E.2d 537 (Ill. 1942) (historic example where right-of-way language produced only an easement; illustrates contextual deed analysis)