In Re: Condemnation by Sunoco Pipeline, L.P. of Permanent and Temporary Rights of Way for the Transportation of Ethane, Propane, Liquid Petroleum Gas, and other Petroleum Products in the Twp. of North Middleton, Cumberland County, PA ~ Appeal of: R.S. Martin
143 A.3d 1000
| Pa. Commw. Ct. | 2016Background
- Sunoco Pipeline, L.P. filed three Declarations of Taking to condemn small permanent and temporary easements in Cumberland County for construction of portions of the Mariner East 2 (ME2) pipeline, part of a larger NGL (natural gas liquids) transmission project.
- Sunoco has long operated an interstate/intrastate pipeline system and holds legacy PUC certificates of public convenience (CPCs) dating to prior ownership; PUC issued additional orders in 2014 expanding and clarifying Sunoco’s intrastate authority (including tariffs) for transporting petroleum products such as propane.
- Condemnees (landowners) filed preliminary objections arguing, inter alia, that: (1) a prior York County decision (Loper) precluded Sunoco’s takings (collateral estoppel); (2) ME2 is purely interstate and therefore outside PUC jurisdiction so Sunoco lacks BCL eminent-domain power; (3) ME2 does not provide PUC‑regulated service; and (4) there was no public need for the takings.
- The trial court consolidated the objections, held an evidentiary hearing, and overruled the preliminary objections, concluding ME2 will provide both interstate (FERC) and intrastate (PUC) service and that PUC had authorized intrastate service (so Sunoco is a public utility with eminent-domain power).
- The Commonwealth Court affirmed the trial court’s order, holding collateral estoppel did not apply, the record shows ME2 will provide intrastate service regulated by PUC, Sunoco possesses PUC‑based authority (CPCs/tariffs), and courts of common pleas may not relitigate PUC’s public-need determinations in eminent-domain preliminary-objection proceedings.
Issues
| Issue | Plaintiff's Argument (Condemnees) | Defendant's Argument (Sunoco) | Held |
|---|---|---|---|
| 1) Collateral estoppel from York County (Loper) | Loper resolved that ME2 was interstate only; that decision should bar these takings. | Loper addressed a different configuration (purely interstate) and did not decide PUC‑based regulation; ME2 was reconfigured to include intrastate service. | Not barred: issues differ (Loper addressed FERC-based regulation only); collateral estoppel inapplicable. |
| 2) Whether ME2 is interstate only (precluding PUC jurisdiction) | Crossing state lines makes ME2 exclusively interstate commerce under federal law; PUC cannot regulate. | Shipments and pipeline segments can be both interstate and intrastate; commingled systems and specific on/off points in PA create intrastate service subject to PUC. | Held both interstate and intrastate service will occur; PUC jurisdiction over intrastate movements applies. |
| 3) PUC regulation / CPCs / authority to condemn | Sunoco lacks a PUC CPC specifically authorizing ME2 or to exercise eminent domain for it; FERC certificates control. | PUC orders and tariffs (including the 2014 orders expanding territory and allowing intrastate propane service) authorize intrastate Mariner East service; CPCs cover upgrades/expansions. | Held PUC orders and approved tariffs show Sunoco is a PUC‑regulated public utility for intrastate Mariner East service; BCL eminent‑domain power applies. |
| 4) Public need and scope of review | Trial court must review public need; PUC CPCs are not dispositive and takings should be denied absent judicial finding of public purpose. | PUC determines public need in CPC proceedings; common pleas may decide scope/validity/compensation but not relitigate PUC’s public‑need determinations. | Held common pleas cannot relitigate PUC’s public‑need findings; PUC CPCs are prima facie evidence of public need; Eminent Domain Code limits preliminary objections accordingly. |
Key Cases Cited
- Fairview Water Co. v. Public Utility Comm’n, 502 A.2d 162 (Pa. 1985) (once PUC finds proposed utility service necessary and proper, scope/validity/damages are for common pleas; PUC determines public need)
- Lands of Stone, 939 A.2d 331 (Pa. 2007) (public purpose test: public must be primary and paramount beneficiary; courts scrutinize true purpose of takings)
- In re Opening a Private Road (O’Reilly), 5 A.3d 246 (Pa. 2010) (takings analysis requires public purpose; courts must review whether statute-authorized takings serve public benefit)
- Kelo v. City of New London, 545 U.S. 469 (U.S. 2005) (discusses public-purpose/public-use standard under the Takings Clause)
- National Steel Corp. v. Long, 718 F. Supp. 622 (W.D. Mich. 1989) (federal regulation under ICA/FERC does not displace state regulation of local interests; interstate/intrastate distinctions can coexist)