Thanks to the good folks at Volokh and Gideon's Trumpet for alerting us to the Texas Supreme Court's opinion in a case we've been following, but somehow slipped by, Texas Rice Land Partners, Ltd. v. Denbury Green Pipeline-Texas, LLC, No. 09-0901 (April 19, 2011).
Texas, like many other states, delegates the power of eminent domain to certain utlilities (Hawaii even delegates the power to "irrigation corporations"). Under a Texas statute, Tex. Nat. Res. Code § 111.002, a pipline company may take property to transport carbon dioxide "to or for the public for hire." A dispute arose between a property owner and a pipeline company when the owner objected to the taking of its property for a pipeline, claiming that there was no evidence that the pipeline would be used by the public to transport CO2. The pipeline company asserted it met the definition of "common carrier" because it accepted the regulatory jurisdiction of the Texas Railroad Commission, and by doing so, the pipeline rendered the carrier's pipelines legally open for public transmission without any inquiry about whether the pipeline was actually open to the public. It was, in lawyer's parlance, a "common carrier" as a matter of law.
The trial court agreed with the pipeline, and the Court of Appeals affirmed. The majority opinion somehow managed to conclude that the taking would be for a public use, without ever once mentioning the Texas Constitution's requirement that private property can only be take for public use, regardless of what any statute may provide.
The Texas Supreme Court reversed, concluding that the Texas Constitution's public use clause required the trial court to make an actual and factual inquiry into the company's claim that the pipeline would be available for use by the public. ."Unadorned assertions of public use are constitutionally insufficient. Merely registering as a common carrier does not conclusively convey the extraordinary power of eminent domain or bar landowners from contesting in court whether a planned pipeline meets statutory common-carrier requirements." Slip op. at 2. The court remanded the case for consideration of that issue.
Professor Ilya Somin suggests that this decision may not have that big of an impact because condemnors have other ways of taking property:
But Texas eminent domain law contains several other loopholes that make it easy for private interest groups to get government to condemn property for their own benefit. As I discuss in this article and here, Texas’ post–Kelo eminent domain reform law includes a very broad definition of “blight” that enables almost any property to be declared blighted and transferred to private parties. Oil companies and others seeking to use eminent domain for private pipelines might be able to get the land they want by having it declared blighted.
Read his entire post here. He is likely correct, but at least with this opinion, the Texas Supreme Court foreclosed the easy path (the court held that a pipline owner cannot "conclusively acquire the right to condemn property by checking the right boxes on a one-page form"). Professor Gideon Kanner takes a brighter view, noting that at least the Texas court did not consider the pipeline company's assertion of public use "'well nigh conclusive' without explaining why that is so," unlike the federal courts:
Historians have shown that this judicial attitude arose in the railroad construction era (and even before then) because judges thought that development of the country was a good thing that should be encouraged. In theory, that may be OK, but their Lordships never explained, either then or now, why this pro-development policy should be pursued on the backs of innocent citizens who have the misfortune of winding up in the path of some public or not-so-public project, especially when its economic outcome promotes and enhances the economic wellbeing of the condemnor.
He concludes: "The Texas Supreme Court’s decision, rare as it is, is an instance of a state court taking a real look at the exercise of the power of eminent domain and, instead of just rubber-stamping the condemnor’s plans, asking if the statutory words invoked by the would-be condemnor actually match reality. And that is not a bad thing."
Whether this opinion augurs a new day in Texas on eminent domain standards or whether the decision after remand will reveal that the promise of meaningful judicial review of the professed reasons for a taking is writ on air remains to be seen. Count us as hopeful.
In case you are interested, here are the briefs filed in the case. The oral argument video is archived here. The court's docket entry is here.
Texas Rice Land Partners Ltd v. Denbury Green Pipeline-Texas LLC, No 09-0901 (Tx Apr 19 2011)
