Barclay v. United States , 443 F.3d 1368 ( 2006 )

Error: Bad annotation destination
United States Court of Appeals for the Federal Circuit
05-1255
JOHN BARCLAY, CONSTANCE BARCLAY, ROYER BARCLAY, ALTHEA BARCLAY,
JOHN AMOS, MARCIA J. BACON, RONALD J. BARTEL, MELVIN BERGEN,
JOHN E. BOYLE, JONATHAN EHRLICH, FLORENCE EHRLICH,
DONALD GRAUMANN, RUBEN KLIEWER, ALVIN KROUPA, BARBARA KROUPA,
BURDETT LEDELL, LEE DALE MILLER, VERNON MINNS, FRANK A. MITCHELL,
MID KANSAS COOPERATIVE ASSOCIATION, JOHN F. OPAT, ROBERT PRESNELL,
JANET REGIER, SONJA REGIER, DON REINHARDT, JANICE REINHARDT,
MARY J. RODGERS, DARRELL THOMPSON, ROBERT TURNER,
GENEVA TURNQUIST, DONALD TURNQUIST, CLARK E. WIEBE,
and MARLENE J. WEBER,
Plaintiffs-Appellants,
v.
UNITED STATES,
Defendant-Appellee.
05-5109
RENEWAL BODY WORKS, INC.,
Plaintiff-Appellant,
v.
UNITED STATES,
Defendant-Appellee.
Cecilia Fex, Ackerson Kauffman Fex, PC, of Washington, DC, argued for
plaintiffs-appellants John Barclay, et al. With her on the brief was Nels Ackerson.
Robert J. Rosati, of Fresno, California, argued for plaintiff-appellant Renewal
Body Works, Inc.
Lane M. McFadden, Attorney, Appellate Section, Environment & Natural
Resources Division, United States Department of Justice, of Washington, DC, argued
for defendant-appellee in 05-1255. With him on the brief were Kelly A. Johnson, Acting
Assistant Attorney General, and Kathryn E. Kovacs and John E. Arbab, Attorneys.
John E. Arbab, Attorney, argued for defendant-appellee in 05-5109. With him on the
brief were Kelly A. Johnson, Acting Assistant Attorney General, and Kathryn E. Kovacs,
Attorney.
Mark F. (Thor) Hearne II, Lathrop & Gage L.C., of St. Louis, Missouri, for amici
curiae Sarah Illig, et al. in appeal 05-1255. With him on the brief were J. Robert Sears
and Alok Ahuja. Of counsel on the brief were Charles J. Cooper, David H. Thompson,
and David M. Lehn, Cooper & Kirk, PLLC, of Washington, DC.
05-1255 appealed from: United States District Court for the District of Kansas
Senior Judge Wesley E. Brown
05-5109 appealed from: United States Court of Federal Claims
Judge George W. Miller
United States Court of Appeals for the Federal Circuit
05-1255
JOHN BARCLAY, CONSTANCE BARCLAY, ROYER BARCLAY, ALTHEA BARCLAY,
JOHN AMOS, MARCIA J. BACON, RONALD J. BARTEL, MELVIN BERGEN,
JOHN E. BOYLE, JONATHAN EHRLICH, FLORENCE EHRLICH,
DONALD GRAUMANN, RUBEN KLIEWER, ALVIN KROUPA, BARBARA KROUPA,
BURDETT LEDELL, LEE DALE MILLER, VERNON MINNS, FRANK A. MITCHELL,
MID KANSAS COOPERATIVE ASSOCIATION, JOHN F. OPAT, ROBERT PRESNELL,
JANET REGIER, SONJA REGIER, DON REINHARDT, JANICE REINHARDT,
MARY J. RODGERS, DARRELL THOMPSON, ROBERT TURNER,
GENEVA TURNQUIST, DONALD TURNQUIST, CLARK E. WIEBE,
and MARLENE J. WEBER,
Plaintiffs-Appellants,
v.
UNITED STATES,
Defendant-Appellee.
-----------------------------------------
05-5109
RENEWAL BODY WORKS, INC.,
Plaintiff-Appellant,
v.
UNITED STATES,
Defendant-Appellee.
___________________________
DECIDED: April 11, 2006
___________________________
Before NEWMAN, DYK, and PROST, Circuit Judges.
Opinion for the court filed by Circuit Judge DYK. Dissenting opinion filed by Circuit
Judge NEWMAN.
The United States District Court for the District of Kansas and the Court of
Federal Claims dismissed several landowners’ Fifth Amendment takings claims
challenging the operation of the National Trail Systems Act (the “Trails Act”), 16 U.S.C.
§ 1247(d). Barclay, et al. v. United States, 351 F. Supp. 2d 1169 (D. Kan. 2004);
Renewal Body Works, Inc. v. United States, 64 Fed. Cl. 609 (2005). Applying our
decision in Caldwell v. United States, 391 F.3d 1226 (Fed. Cir. 2004), cert. denied 126
S. Ct. 366 (2005) (mem.), both the district court and the Court of Federal Claims held
that the claims were time-barred because they were filed more than six years after the
Surface Transportation Board (“STB”) issued the Notices of Interim Trail Use or
Abandonment (“NITU”). We agree that Caldwell governs, and we affirm.
BACKGROUND
I
By 1990, the nation’s interstate railway system had shrunk from its peak of
272,000 miles of track in 1920 to about 141,000 miles of track, and railroads continue
abandoning track each year. Preseault v. Interstate Commerce Comm’n, 494 U.S. 1, 5
(1990) (“Preseault I”). As the Supreme Court explained in Preseault I, the purpose of
the Trails Act was to preserve unused railroad rights-of-way by converting them into
recreational trails. Id. The mechanism is a STB order (a NITU) staying railroad
abandonment during the pendency of trail use.
As described in detail in Preseault I, 494 U.S. at 7-8, Preseault v. United States,
100 F.3d 1525, 1537-40 (Fed. Cir. 1996) (en banc) (“Preseault II”), and Caldwell, 391
F.3d at 1228-30, in order to abandon a line that is subject to STB jurisdiction, a railroad
must apply to the STB under either 49 U.S.C. § 10903 (standard abandonment), or 49
05-1255, 05-5109 2
U.S.C. § 10502 (abandonment by exemption).1 All proceedings involved in these
appeals were exemption proceedings. Under the Trails Act, the STB may issue a NITU,
suspending exemption proceedings for 180 days to allow a third party to enter into an
agreement with the railroad to use the right-of-way as a recreational trail. 49 C.F.R.
§ 1152.29(b)(2) and (d) (2005). If the railroad and the trail operator reach an
agreement, “the NITU extends indefinitely to permit interim trail use . . . .” Caldwell, 391
F.3d at 1230; see 49 C.F.R. § 1152.29(d)(1). If no trail use agreement is reached, the
NITU converts into an effective notice of exemption, allowing the railroad to “abandon
the line entirely and liquidate its interest.” Preseault I, 494 U.S. at 7; see Caldwell, 391
F.3d at 1230. While it retains jurisdiction over the right-of-way, the STB may reopen
exemption proceedings to substitute a new trail operator, 49 C.F.R. § 1152.29(f), to
accept late-filed trail use requests, 49 C.F.R. § 1152.29(e)(1), or to vacate a notice of
exemption and issue a NITU when a railroad late files its statement of willingness to
negotiate, 49 C.F.R. § 1152.29(g).
In Preseault I, the Court noted but did not resolve the claim that “Congress . . .
violated the Fifth Amendment by precluding reversion of state property interests.” 494
U.S. at 9; see also id. at 22 (O’Connor, J., concurring) (operation of the Trails Act “may
delay property owners’ enjoyment of their reversionary interests,” which “burdens and
defeats the property interest”). In Preseault II, we established that the elimination of
adjacent landowners’ state law reversionary interests when abandonment is suspended
under the Trails Act constitutes a Fifth Amendment taking. 100 F.3d at 1550-52. In
1
On January 1, 1996, the STB succeeded the Interstate Commerce
Commission as the agency with authority to regulate the interstate rail system. 49
U.S.C. § 702 (2000). We use “STB” to refer to both agencies.
05-1255, 05-5109 3
Caldwell, we held that such a claim accrues for statute-of-limitations purposes when
railroad abandonment proceedings are suspended by the STB’s issuance of a NITU.
Caldwell, 391 F.3d at 1235. The Barclay appellants (the appellants in No. 05-1255) and
Renewal (the appellant in No. 05-5109) challenge both the correctness of the Caldwell
decision and its applicability to the particular facts of their takings claims.
II
The Barclay appellants filed their Trails Act takings claims in the United States
District Court for the District of Kansas on April 7, 2004. The complaint alleged that
railroad rights-of-way running across the Barclay appellants’ property in Kansas were
converted into three different recreational trails (the Meadowlark, Sunflower, and Flint
Hills trails) pursuant to the Trails Act, and that these conversions constituted Fifth
Amendment takings. The government moved to dismiss on the ground that the
complaint was not filed within the six year statute of limitations. We decided Caldwell
while the government’s motion was pending. Because the initial NITUs for all three
trails were issued prior to the cutoff date for the statute of limitations,2 the district court
dismissed the complaint.
The district court found that the Supreme Court’s decisions in American Pipe &
Construction Co. v. Utah, 414 U.S. 538 (1974), and Crown Cork & Seal Co., Inc. v.
Parker, 462 U.S. 345 (1983), required tolling the statue of limitations for eleven months,
three weeks, and one day, during the pendency of Swisher v. United States, 189 F.R.D.
638 (D. Kan. 1999), a class action alleging Trails Act takings in which the Barclay
2
The relevant NITUs were issued on September 28, 1995 (Meadowlark
trail), April 12, 1996 (Sunflower trail), and March 31, 1995, and May 24, 1996 (Flint Hills
trail). As noted the complaint was filed on April 7, 2004.
05-1255, 05-5109 4
appellants were class members. The district court nevertheless concluded that the
action was not timely filed, applying our holding in Caldwell that the claims accrued on
issuance of the original NITUs. The district court rejected contentions that replacement
NITUs, rather than the initial NITUs, triggered the accrual of their claims for the Flint
Hills and Sunflower trails, holding that subsequently issued NITUs covering the same
rights of way “merely continued in effect the blocking of the reversionary interests begun
by the first NITU” and “could not amount to a separate taking of the property triggering a
new claim . . . .” Barclay, 351 F. Supp. 2d at 1179. The Barclay appellants timely
appealed, and we have jurisdiction pursuant to 28 U.S.C. § 1295(a)(2).
III
Renewal’s complaint in the Court of Federal Claims alleged that Trails-Act
conversion of a railroad right-of-way running across Renewal’s property in California
constituted a taking. The STB authorized abandonment effective May 28, 1995, and the
putative trail operator filed a trail use request on May 23, 1995. The railroad had
removed most of the track and equipment by July 1995, though abandonment had not
been consummated under federal law. The STB subsequently issued a NITU on
October 23, 1995, and the right-of-way was converted into a trail.
Renewal filed its complaint in the Court of Federal Claims on December 11,
2003. The Court of Federal Claims dismissed the complaint, relying on Caldwell to
conclude that “Renewal’s claim accrued on October 23, 1995, the day the NITU was
issued,” well outside the six-year limitations period. Renewal, 64 Fed. Cl. at 615.
Renewal timely appealed, and we have jurisdiction pursuant to 28 U.S.C. § 1295(a)(3).
05-1255, 05-5109 5
DISCUSSION
We review both the district court’s dismissal for want of jurisdiction and the legal
conclusions of the Court of Federal Claims without deference. Lion Raisins, Inc. v.
United States, 416 F.3d 1356, 1362 (Fed. Cir. 2005); Applegate v. United States, 25
F.3d 1579, 1581 (Fed. Cir. 1994). We agree with the district court and the Court of
Federal claims that these actions are time-barred under our decision in Caldwell.3
I
We explained in Caldwell that “[t]he taking, if any, when a railroad right-of-way is
converted to interim trail use under the Trails Act occurs when state law reversionary
property interests that would otherwise vest in the adjacent landowners are blocked
from so vesting.” Caldwell, 391 F.3d at 1233. Abandonment is suspended and the
reversionary interest is blocked “when the railroad and trail operator communicate to the
STB their intention to negotiate a trail use agreement and the agency issues an NITU
that operates to preclude abandonment under section 8(d)” of the Trails Act. Id. We
concluded that “[t]he issuance of the NITU is the only government action in the
railbanking process that operates to prevent abandonment of the corridor and to
preclude the vesting of state law reversionary interests in the right of way.” Id. at 1233-
34 (emphasis in original). Thus, a Trails Act taking begins and a takings claim accrues,
if at all, on issuance of the NITU. We explicitly held in Caldwell that “[w]hile the taking
may be abandoned . . . by the termination of the NITU[,] the accrual date of a single
taking remains fixed.” Id. at 1235. The issuance of the NITU is the only event that must
3
Because we agree with the district court that the Barclay appellants’
claims were time-barred even assuming that the Swisher action tolled the limitations
period, we do not decide here whether the Swisher action required tolling.
05-1255, 05-5109 6
occur to “entitle the plaintiff to institute an action.” Creppel v. United States, 41 F.3d
627, 631 (Fed. Cir. 1994). Accrual is not delayed until a trail use agreement is executed
or the trail operator takes physical possession of the right-of-way.
II
The Barclay appellants and Renewal first argue that Caldwell was wrongly
decided and should be overruled. Panels of this court are bound by previous
precedential decisions until overturned by the Supreme Court or by this court en banc.
Kimberly-Clark Corp. v. Fort Howard Paper Co., 772 F.2d 860, 863 (Fed. Cir. 1985).
The court declined to rehear Caldwell en banc, and the Supreme Court denied
certiorari. Caldwell v. United States, 126 S. Ct. 366 (2005) (mem.). In any event, the
majority of these arguments were rejected in Caldwell. To the extent that they are new,
they are without merit.
The appellants and amicii contend that Caldwell was wrongly decided insofar as
it relied on federal rather than state law to determine when abandonment and reversion
of railroad rights-of-way occur.
Renewal argues that because the railroad had removed its track and equipment
from the right-of-way by June 1995, effectively abandoning it under California law and
granting Renewal “full and exclusive, undisturbed, and uncontested possession and
use” of the property until trail use began, App. Br. of Renewal at 17, the issuance of the
NITU in October, 1995 did not block Renewal’s reversionary interest. Thus, Renewal
concludes that its claim did not accrue until it was physically ousted from the property
when trail use began.
05-1255, 05-5109 7
While state law generally creates the property interest in a railroad right-of-way,
Preseault I, 494 U.S. at 8, 16,4 “the disposition of reversionary interests [is] subject . . .
to the [STB’s] ‘exclusive and plenary’ jurisdiction to regulate abandonments” of railroad
rights of way. Id. at 8 (quoting Chi. & N. W. Transp. Co. v. Kalo Brick Y Tile Co., 450
U.S. 311, 321 (1981)). Federal law dictates when abandonment occurs. Thus,
Renewal is incorrect that state law governs the timing of the abandonment.
Abandonment cannot occur until authorized by federal law, and the NITU precludes
abandonment and the reversion that would follow if abandonment were consummated.
16 U.S.C. § 1247(d) (2000); 49 C.F.R. § 1152.29(d)(1); Caldwell, 391 F.3d at 1229;
Preseault v. Interstate Commerce Comm’n, 853 F.2d 145, 151 (2d Cir. 1988) (“Until the
[STB] issues a certificate of abandonment, the railway property remains subject to the
[STB’s] jurisdiction, and state law may not cause a reverter of the property.”); Nat’l
Wildlife Fed’n v. Interstate Commerce Comm’n, 850 F.2d 694, 704 (D.C. Cir. 1988)
(“Nor may state law cause a reverter of a right-of-way prior to an [STB]-approved
abandonment.”). Thus, there could be no abandonment until authorized by federal law.
The NITU barred the abandonment; abandonment cannot occur after issuance of a
NITU while the NITU is in effect. The barrier to reversion is the NITU, not physical
ouster from possession. As Renewal itself admits, after issuance of the NITU, “the
4
In Toews v. United States, 376 F.3d 1371 (Fed. Cir. 2004), we reiterated
that state law controls the basic issue of whether trail use is beyond the scope of the
right-of-way. Id. at 1376-77. This merits question is distinct from the issue of claim
accrual. See also Hash v. United States, 403 F.3d 1308, 1319-23 (Fed. Cir. 2005)
(applying Idaho law to determine whether reversionary interests existed).
05-1255, 05-5109 8
easement continued in existence beyond the time when it otherwise would have been
abandoned.” Reply Br. of Renewal, at 4. Thus, the NITU triggers accrual. 5
The Barclay appellants’ state law argument is also without merit. In the case of
the Meadowlark trail, they insist that the NITU would not itself block a reversion if the
railroad continued to use the right-of-way for railroad purposes after the NITU was
issued. They argue that under Kansas law (which assertedly is different from California
law), the taking can occur only after federal law authorized abandonment – that is, when
the railroad ceases operations and the trail operator assumes physical possession.
They thus urge that the trail operator’s physical occupation, and not the Meadowlark
trail NITU, blocked the reversion.6 But even if under Kansas law the reversion would
not occur until after federal authorization of abandonment, that state law reversion was
still delayed by the issuance of the NITU, and the claim still accrued with the issuance of
the NITU. It similarly makes no difference that railroad use may have continued after
the NITU issued. The termination of railroad use was still delayed by the NITU.
III
The Barclay appellants also contend that Caldwell is distinguishable on a number
of grounds.
A
The Barclay appellants argue that the original NITUs issued for the Flint Hills trail
were vacated and that a second taking occurred when a new NITU was issued.
5
Renewal also appears to argue that the railroad conferred rights on
Renewal to use the right-of-way for parking during the period of railroad use, and that
the conversion to trail use ousted Renewal from the right to use the right-of-way for
parking. Whether or not this is correct, the alleged ouster was not a consequence of
actions taken under the Trails Act.
6
Amicii Sarah and Gale Illig also advance this same argument.
05-1255, 05-5109 9
Although issuance of a NITU requires that at least one trail operator file a statement of
willingness to assume responsibility for the trail before issuance of the NITU, and that
trail operator is listed in the NITU, the ordering clause of a NITU is not typically limited to
a particular trail operator7 and a railroad is free to negotiate a trail use agreement with
any party. See Rail Abandonments – Use of Rights-of-Way as Trails, Ex Parte No. 274
(Sub. No. 13), 2 I.C.C.2d 591, 605-06, 608, 1986 WL 68617 (1986) (“Rail
Abandonments”); Neb. Trails Council v. Surface Transp. Bd., 120 F.3d 901, 906 (8th
Cir. 1997); Goos v. Interstate Commerce Comm’n, 911 F.2d 1283, 1293 (8th Cir. 1990).
Nonetheless, it is common that, if after issuance of the NITU the trail operator named in
the original NITU becomes unwilling or unable to assume responsibility for the trail, a
new operator will be able to be formally substituted by issuance of a new NITU before
an agreement with the railroad is reached. It is also common for the original trail
operator to become unwilling or unable to serve after an agreement is reached with the
railroad, and for the original trail operator to propose to transfer trail use rights and
responsibilities to a new trail operator. See Rail Abandonments, 2 I.C.C.2d at 606-08
(recognizing such “serial trail use” as appropriate).
The regulations provide a mechanism for substituting trail operators and updating
NITUs without abandonment. The original and replacement trail operators file a notice
7
See, e.g., Cent. Kan. Ry., LLC – Abandonment Exemption – In Marion &
McPherson Counties, KS, STB Docket No. AB-406 (Sub. No. 6X), 1996 WL 169774(1996) (original Sunflower Trail NITU) (imposing no limitations on negotiating parties,
referring only to “the trail user” in specifying the requirements for interim trail use); Mo.
Pac. R.R. Co. – Abandonment Exemption – In Morris & Dickinson Counties, KS, STB
Docket No. AB-3 (Sub. No. 121X), 1995 WL 137149 (1995) (Flint Hills trail, Dickinson
Segment original NITU) (same); Union Pac. R.R. Co. – Abandonment Exemption – In
McPherson County, KS, STB Docket No. AB-33 (Sub. No. 89X), 1995 WL 569357(1995) (same).
05-1255, 05-5109 10
in accordance with 49 C.F.R § 1152.29(f)(1). Then, a new NITU (naming the new trail
operator) is substituted for the original NITU (naming the original trail operator). As the
regulation provides, “[t]he board will reopen the abandonment or exemption proceeding,
vacate the existing NITU or CITU; and issue an appropriate replacement NITU or CITU
to the new trail user.” 49 C.F.R. § 1152.29(f)(2). There is no gap between the original
and replacement NITUs. Though formally “vacat[ing]” the original NITUs, the STB
makes clear that, in substance, it is “substituting” trail users “in the [same]
proceedings.”8
Under these circumstances, we agree with the district court’s conclusion that the
series of STB NITU orders must be viewed as part of a single and continuous
government action rather than as new takings. Any other approach would result in
multiple potential takings of the same reversionary interest. In Caldwell, we rejected
that approach, following United States v. Dow, 357 U.S. 17, 24 (1958), where the
Supreme Court dismissed as “bizarre” the contention that there could be “two different
‘takings’ of the same property, with some incidents of the taking determined as of one
date and some as of the other.” So long as abandonment was not consummated, the
STB retained jurisdiction over the right-of-way. See Baros v. Tex. Mexican Ry. Co., 400
F.3d 228, 236 (5th Cir. 2005); Birt v. Surface Transp. Bd., 90 F.3d 580, 585 (D.C. Cir.
1996). Thus, any extensions or modifications of the original NITU were not separate
potential takings.
8
See Mo. Pac. R.R. – Abandonment Exemption – In Osage, Lyon, & Morris
Counties, KS, STB Docket No. Ab-3 (Sub. No. 111X), Mo. Pac. R. Co. – Abandonment
Exemption – In Miami, Franklin, & Osage Counties, KS, STB Docket No. AB-3 (Sub.
No. 115), Mo. Pac. R. Co. – Abandonment Exemption – In Morris & Dickinson Counties,
KS, STB Docket No. AB-3 (Sub. No. 121X), 1997 WL 414314 (1997).
05-1255, 05-5109 11
B
No different result is required for the Sunflower Trail NITU. The initial Sunflower
Trail NITU was set to expire on June 6, 1997. Although a new trail operator filed a
request to be substituted and for the issuance of a new NITU on June 6, the STB did
not issue the NITU until 10 days later, on June 16, 1997. The Barclay appellants argue
that under these circumstances the original NITU became inoperative, abandonment
occurred, and the landowners’ interest reverted. The replacement NITU in their view
was a distinct government action that affected a new taking. Here again, however, the
new NITU in substance merely extended the original NITU9 and listed a new potential
trail operator. Moreover, it is clear that the STB had authority to extend the NITU and
that abandonment did not occur in the interim. See Birt, 90 F.3d at 585-87. In Birt, a
landowner argued that the STB abused its discretion by retroactively extending a CITU
(the version of the NITU issued in standard abandonment proceedings rather than
exemption proceedings) eight days after the CITU expired. The District of Columbia
Circuit disagreed, concluding that the STB retained jurisdiction over the right-of-way,
and thus had authority to issue the extension, because the railroad did not consummate
abandonment while the CITU was expired. Id. at 585-87. The new CITU became
merely a continuation of the old. We agree with the District of Columbia Circuit’s
decision in Birt. Here, the railroad did not consummate abandonment of the Sunflower
Trail right-of-way or file a notice of consummation with the STB between June 6, 1997,
9
Cent. Kan. Ry., LLC – Abandonment Exemption – In Marion & McPherson
Counties, KS, STB Docket No. AB-406 (Sub. No. 6X), 1997 WL 323576 (1997) (“Upon
reconsideration, the notice of exemption served . . . on March 13, 1996, exempting the
abandonment of the line described above is modified to the extent necessary to
implement interim trail use/rail banking . . . until December 13, 1997.”).
05-1255, 05-5109 12
the day the initial NITU expired, and June 16, 1997, the day the replacement NITU was
issued.10 Thus the new NITU was not a separate taking.
C
The Barclay appellants also insist that the Meadowlark Trail NITU did not block
their reversionary interest because, unlike the NITU at issue in Caldwell, it contained a
180-day public use condition issued pursuant to 49 U.S.C. § 10905. The public use
condition requires offering rights-of-way for sale to parties interested in using the
property for, inter alia, “highways, other forms of mass transportation, conservation,
energy production or transmission, or recreation.” 49 U.S.C. § 10905 (2000). Here, at
the time of the issuance of the NITU, a trail operator was named and the railroad had
stated its willingness to negotiate a trail use agreement. The trail operator alternatively
requested the issuance of the public use condition, apparently on the theory that a
public use condition would preserve the right-of-way for trail use. In accordance with its
policy, the STB issued both conditions simultaneously. The STB in the NITU made
clear that the public use condition was “subject to the execution of a trail agreement,”
and that “[i]f an interim trail use/rail banking agreement is executed within the 180-day
period specified above, the public use condition will expire to the extent the trail use/rail
banking agreement covers the same line segment.” Union Pac. R. Co. – Abandonment
Exemption – In McPherson County, KS, STB Docket No. AB-33 (Sub. No. 89X), 1995
10
As of December 24, 1996, the railroad must file a notice of consummation
of abandonment with the STB within one year of the effective date of the notice of
exemption permitting abandonment. 49 C.F.R. § 1152.29(e)(2); 61 Fed. Reg. 67876-
01, 67896-97 (Dec. 24, 1996) (adding § 1152.29(e)(2)). The STB retains jurisdiction
over the right-of-way until the notice of consummation is filed. See Baros, 400 F.3d at
236.
05-1255, 05-5109 13
WL 569357, (1995) (“Meadowlark NITU”). No agreement was reached under the public
use condition, and it expired after 180 days.
The Barclay appellants’ theory appears to be that if the right-of-way were
purchased under the public use condition for a use that was within the scope of the
right-of-way, for example, continued rail use for mass transit, reversion might not have
occurred under state law, and hence that the blockage of the reversion did not occur
until the public use condition expired.
We do not think that Caldwell can be distinguished on this basis. The primary
object of the NITU was to preclude abandonment and thus to enable a trail use
agreement. But for the NITU’s trail use condition, the railroad could abandon the line
immediately and trigger the reversion, since the public use condition did not itself
preclude abandonment. See Fritsch v. Interstate Commerce Comm’n, 59 F.3d 248, 252
(D.C. Cir. 1995) (section 10906 precludes sale or other disposal of the right-of-way, but
not abandonment); Nat’l Wildlife Fed’n, 850 F.2d at 701-02 (what is now section 10905
“has no rail banking provision that would preempt state laws that could otherwise result
in reversion of rights-of-way to abutting landowners upon a cessation of rail service”).
The bar on abandonment effected by the NITU’s trail use condition triggered accrual of
the cause of action here just as it did in Caldwell.
D
Finally, the Barclay appellants argue that their Sunflower Trail claims did not
accrue when the initial NITU was issued on April 12, 1996, because after the
replacement NITU was issued on June 16, 1997, a group of landowners petitioned to
reopen the exemption proceeding and vacate both the initial NITU and the replacement
05-1255, 05-5109 14
NITU. The petitioners argued that the railroad omitted material facts in its notice of
exemption and that CKC was financially unfit to serve as trail operator. The STB denied
the petition to reopen on December 18, 1998. The petitioners appealed to the District of
Columbia Circuit, which affirmed in part and reversed in part on October 22, 1999. See
Jost v. Surface Transp. Bd., 194 F.3d 79 (D.C. Cir. 1999). On remand, the STB further
explained its reasoning and again denied the petition on May 8, 2001. That denial was
not appealed.
The Barclay appellants contend that their claim did not accrue until the petition to
reopen was finally denied on May 8, 2001, even though the original NITU as extended
by the replacement NITU never ceased to be effective. This is merely another version
of the argument -- rejected in Caldwell -- that the original NITU should not be viewed as
the taking because subsequent events might render the NITU only temporary. The
Sunflower Trail claims accrued when the original NITU issued, regardless of the petition
to reopen.
IV
In summary, we adhere to Caldwell and hold that the issuance of the original
NITU triggers the accrual of the cause of action. The appellants’ arguments in these
cases urging a different trigger, depending on when abandonment occurred under state
law, when the last NITU in a series was issued, or when the NITU was no longer subject
to collateral attack, merely emphasize the correctness of the Caldwell rule. Appellants’
arguments lead potentially to multiple takings of a single reversionary interest and
endless litigation concerning the appropriate date for accrual, thus leaving landowners
and the government in a state of great uncertainty as to their respective rights and
05-1255, 05-5109 15
obligations. Here, as in Caldwell, we conclude that takings law supplies a single bright-
line rule for accrual that avoids these adverse consequences.
CONCLUSION
The decisions of the district court and Court of Federal Claims dismissing the
appellants’ complaints are
AFFIRMED.
COSTS
No costs.
05-1255, 05-5109 16
United States Court of Appeals for the Federal Circuit
05-1255
JOHN BARCLAY, CONSTANCE BARCLAY, ROYER BARCLAY, ALTHEA BARCLAY,
JOHN AMOS, MARCIA J. BACON, RONALD J. BARTEL, MELVIN BERGEN,
JOHN E. BOYLE, JONATHAN EHRLICH, FLORENCE EHRLICH,
DONALD GRAUMANN, RUBEN KLIEWER, ALVIN KROUPA, BARBARA KROUPA,
BURDETT LEDELL, LEE DALE MILLER, VERNON MINNS, FRANK A. MITCHELL,
MID KANSAS COOPERATIVE ASSOCIATION, JOHN F. OPAT, ROBERT
PRESNELL,JANET REGIER, SONJA REGIER, DON REINHARDT, JANICE REINHARDT,
MARY J. RODGERS, DARRELL THOMPSON, ROBERT TURNER,
GENEVA TURNQUIST, DONALD TURNQUIST, CLARK E. WIEBE,
and MARLENE J. WEBER,
Plaintiffs-Appellants,
v.
UNITED STATES,
Defendant-Appellee.
----------------------------------------
05-5109
RENEWAL BODY WORKS, INC.,
Plaintiff-Appellant,
v.
UNITED STATES,
Defendant-Appellee.
NEWMAN, Circuit Judge, dissenting.
The panel majority holds that a Fifth Amendment taking occurs in a rails-to-
trails case, and is actionable for compensation, on the date the government issues a Notice
of Interim Trail Use or Abandonment ("NITU"). Such Notice announces the railroad's right
to abandon railway use and negotiate with a potential trail operator. If an agreement for
interim trail use is reached, the right-of-way is rail-banked for possible future railway use.
16 U.S.C. §1247(d). If such an agreement is not reached within 180 days, or an extension
thereof, the right-of-way is deemed abandoned and any easements therefor are
extinguished in accordance with the applicable state law. See Preseault v. Interstate
Commerce Comm'n, 494 U.S. 1, 7 n.5 (1989) ("If agreement [for interim trail use with a
qualified trail operator] is reached, interim trail use is thereby authorized. If not, the CITU or
NITU automatically converts into an effective certificate or notice of abandonment."). Thus,
the statute and the NITU do not make trail use mandatory, and if trail use is not achieved,
the statute effects abandonment of railway use and reversion of the right-of-way easement.
A Fifth Amendment taking cannot occur simply upon issuance of a NITU, because
the deprivation of the reversion has not yet occurred, and may never occur. If railway use
is simply abandoned, the easement is extinguished, the property is unburdened, and no
taking occurs. Thus the issuance of a Notice of Interim Trail Use or Abandonment is not a
per se taking, and no right of compensation arises on issuance of the Notice. My
colleagues err in holding that the period of limitations for Fifth Amendment compensation
starts to accrue, and that an action can be brought, immediately upon issuance of the
NITU. As explained in Hair v. United States 350 F.3d 1253 (Fed. Cir. 2003), a period of
limitations does not accrue until an issue is actionable:
The basic rule is that the clock of a statute of limitations begins to run from
the date the plaintiff's cause of action "accrues," . . . A cause of action
"accrues" when the plaintiff has a complete and present cause of action.
"The earliest opportunity for a complete and present cause of action is that
moment when the plaintiff has suffered a legally recognizable harm at the
hands of the defendant, such as the time of contract breach or the
commission of a tortious wrong."
Id. at 1260 (quoting 1 Calvin W. Corman, Limitation of Actions §6.1 (1991)).
05-1255, 05-5109 2
As discussed in Preseault v. United States, 100 F.3d 1525 (Fed. Cir. 1996), the
conversion of a railroad right-of-way to a recreational trail can constitute a Fifth Amendment
taking. However, the cause of action and right to compensation do not vest until the claim
accrues. In Boling v. United States, 220 F.3d 1365 (Fed. Cir. 2000) this court reiterated
that: "In general, a takings claim accrues when 'all events which fix the government's
alleged liability have occurred and the plaintiff was or should have been aware of their
existence.'") Id. at 1370 (quoting Hopland Band of Pomo Indians v. United States, 855 F.2d
1573, 1577 (Fed. Cir. 1988)). From my colleagues' ruling that a taking occurred as soon as
the possibility arose for trail conversion as an alternative to abandonment of the right-of-
way, I must, respectfully, dissent.
The general rule in physical takings cases is that the taking is actionable when the
property is taken and liability is fixed, not when it is suggested to be taken. In United States
v. Clark, 445 U.S. 253 (1980) the Court stated that "physical takings by governmental
bodies that may entitle a landowner to sue for compensation," 445 U.S. at 256, occur with
the occupation of the property: "Condemnation proceedings, depending on the applicable
statute, require various affirmative action on the part of the condemning authority. To
accomplish a taking by seizure, on the other hand, a condemning authority need only
occupy the land in question." 445 U.S. at 257. In Nollan v. California Coastal Comm’n, 483
U.S. 825, 832 (1987) the Court made clear that it is the permanent occupation or
permanent right of traversal that triggers the owner's right to compensation, not the
commencement of negotiations. See generally Dow v. United States, 357 U.S. 17 (1958)
(the taking occurred when the property was occupied, not when the deed was transferred
some time later). In Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419 (1982)
the Court focused on the permanent physical occupation of the property in determining
05-1255, 05-5109 3
whether a taking had occurred, not the legislative or administrative events that authorized
that occupation.
The NITU is prospective, and requires additional steps by the rail carrier and others
before either of the two options authorized by the NITU will take legal effect. See 49 C.F.R.
§1152.29. The NITU does not require that the railroad must consummate an agreement for
rails-to-trails conversion. 48 C.F.R. §§1152.29(d), (e)(2); see National Wildlife Federation
v. Interstate Commerce Comm'n, 850 F.2d 694, 700-02 (D.C. Cir. 1988). As discussed in
the context of whether the issuance of a NITU must be preceded by an environmental
impact study, the tentative aspect of the NITU is stressed:
[I]ssuance of an NITU or CITU is not only incidental to the abandonment, but
also is itself not a guarantee of eventual trail use. The NITU or CITU serves
only "to provide an opportunity for the railroad and prospective trail users to
negotiate an agreement; thus, when [the STB issues] a NITU or CITU there
is only a possibility that a particular right-of-way actually will be used as a
recreational trail."
Goos v. Interstate Commerce Comm'n, 911 F.2d 1283, 1293 (8th Cir. 1990) (emphasis in
original).
When the government issued the NITU herein, it was not known whether the right-
of-way would be converted to a recreational trail. If the ensuing negotiations had failed,
such that the trail did not come into being, there could be no taking based on trail use. A
suit for compensation is not ripe until the taking occurs. The panel majority states that "the
termination of railroad use was still delayed by the NITU," maj. op. at 9, producing the
incongruity whereby despite the delay in abandonment, the majority holds that the cause of
action had already accrued. A "delay" of possible conversion to trail use, while it remains
unknown whether trail use will occur at all, is not a per se taking with already vested
entitlement to compensation. A taking claim does not accrue until "all events have
05-1255, 05-5109 4
occurred that fix the alleged liability of the Government and entitle the plaintiff to institute an
action." Seldovia Native Ass'n v. United States, 144 F.3d 769, 774 (Fed. Cir. 1998). The
plaintiffs herein could not have sued for compensation while the trail use negotiations were
ongoing; the period of limitations cannot accrue before suit could have been brought. Hair,
350 F.3d at 1260.
Indeed, the panel majority reinforces this view in its recognition that "So long as
abandonment was not consummated, the STB retained jurisdiction over the right-of-way."
Maj. op. at 11. Yet the "key date for accrual purposes is the date on which the plaintiff's
land has been clearly and permanently taken." Boling, 220 F.2d at 1370 (citing Seldovia).
A taking claim cannot accrue any earlier than when the indispensable event required to
establish the government's liability has occurred. See Hash v. United States, 403 F.3d
1308, 1318 (Fed. Cir. 2005) ("On the railway's abandonment of its right-of-way these
owners were disencumbered of the railway easement, and upon conversion of this land to a
public trail, these owners' property interests were taken for public use, in accordance with
the principles set forth in the Preseault cases.")
The panel majority errs in holding that the railroad's "willingness to negotiate a trail
use agreement," maj. op. at 13, is an actionable Fifth Amendment taking. Although my
colleagues extol the virtues of a "bright line" for accrual of the period of limitations, citing
Caldwell v. United States, 391 F.2d 1226 (Fed. Cir. 2004), their choice of bright line would
vest compensation rights although no taking may ever occur. The issuance of a Notice of
Interim Trail Use is not a taking, whether or not railway use has already been abandoned,
and independent of when trail use is successfully consummated. For a taking, "the alleged
harm must be actual or imminent, not conjectural or hypothetical." Whitmore v. Kansas,
495 U.S. 149, 155 (1990). As elaborated in Preseault, 100 F.3d at 1530 ("We find no
05-1255, 05-5109 5
support in Vermont law for the proposition, propounded by the defendants and accepted by
the dissent, that the scope of an easement limited to railroad purposes should be read to
include public recreational hiking and biking trails."), liability for a taking is based on the
change in use of the easement from railroad use to recreational trail. Until that change is
fixed and its occurrence firm, there is no accrual of the right to recover compensation for
such taking.
To the extent that Caldwell is construed to hold otherwise, as does the panel
majority, Caldwell warrants review. We should sit en banc for this purpose, for the
government advises that there are some twenty-two pending cases arising from the
National Trails System Act. It is appropriate and necessary for this court to clarify the
inconsistencies in our precedent.
05-1255, 05-5109 6