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Sabal Trail Transmission, LLC v. Real Estate

United States District Court, N.D. Florida, Gainesville Division

June 5, 2017

Sabal Trail Transmission, LLC, Plaintiff,
Real Estate, ET AL., of Corrections Defendants.


          Mark E. Walker United States District Judge

         “[T]he dichotomy between personal liberties and property rights is a false one. Property does not have rights. People have rights[, such as t]he right to enjoy property without unlawful deprivation . . . . That rights in property are basic civil rights has long been recognized.” Lynch v. Household Fin. Corp., 405 U.S. 538, 552 (1972) (citations omitted). Those basic civil rights also dictate that private property owners must be compensated when their property is taken for public use.

         This case presents a related, straightforward choice-of-law question. What substantive law controls the amount of compensation due to a private landowner for the taking of his or her property by a private entity exercising federal eminent-domain authority-federal or state law? If federal law controls, Defendants are not entitled to litigation expenses. But if state law controls, they are.

         Because Eleventh Circuit precedent-and the overwhelming weight of authority-teaches that state substantive law controls, Plaintiff's Motion for Partial Summary Judgment, ECF No. 69, is DENIED.


         Sabal Trail Transmission, LLC (“Plaintiff”) proposes to construct 516.2 miles of mainline pipeline in Alabama, Georgia, and Florida, known as the Sabal Trail Project (“Project”). ECF No. 1, at 3-4. Plaintiff also proposes associated lateral pipelines in Florida, five new compressor stations, and a hub in Central Florida. Id. at 4. The Project will supply natural gas to Florida Power & Light Company and Duke Energy Florida, LLC, for their power-generation needs. Id. at 3-4.

         The Federal Energy Regulatory Commission (“FERC”) issued Plaintiff a Certificate of Public Convenience and Necessity (“FERC Certificate”) for the Project. Id. at 3. As holder of that FERC Certificate, § 717f(h) of the Natural Gas Act authorizes Plaintiff to “exercise . . . the right of eminent domain” and bring a condemnation action against private property owners for any property needed to construct, operate, or maintain a pipeline or associated facilities. 15 U.S.C. § 717f(h) (2012).

         Plaintiff initiated an eminent-domain condemnation action against multiple private property owners (“Defendants”). ECF No. 1. Plaintiff then filed a Motion for Partial Summary Judgment, asserting that the Fifth Amendment to the United States Constitution's “just compensation” measure-which does not include the property owner's litigation expenses in an eminent-domain condemnation action-governs. ECF No. 69, at 1; see also United States v. Bodcaw Co., 440 U.S. 202, 203 (1979) (“Thus, ‘[a]ttorneys' fees and expenses are not embraced within just compensation . . . .'” (quoting Dohany v. Rogers, 281 U.S. 362, 368 (1930))). Defendants disagree, and argue that the Florida Constitution's “full compensation” measure-which includes reasonable attorney's fees and expenses-governs. ECF No. 81, at 1-2; see also Fla. Const. art. X, § 6(a) (“No private property shall be taken except for a public purpose and with full compensation therefor paid to each owner . . . .” (emphasis added)); Joseph B. Doerr Trust v. Cent. Fla. Expressway Auth., 177 So.3d 1209, 1215 (Fla. 2015) (holding that it is “fundamentally clear” that the definition of full compensation under Florida's Constitution includes reasonable attorney's fees (citations omitted)).


         Summary judgment is appropriate when “the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). The parties agree to all material facts; thus, the only disputes relate to questions of law. “Where the unresolved issues are primarily legal rather than factual, summary judgment is particularly appropriate.” Bruley v. Vill. Green Mgmt. Co., 592 F.Supp.2d 1381, 1388 (M.D. Fla. 2008) (quoting Uhl v. Swanstrom, 79 F.3d 751, 754 (8th Cir. 1996)).


         Plaintiff contends that the Fifth Amendment's “just compensation” measure controls because federal law supplies the exclusive measure of compensation in Natural Gas Act condemnation proceedings. This Court disagrees.


         Federal law governs questions involving the rights and liabilities under the Natural Gas Act. See United States v. Kimbell Foods, Inc., 440 U.S. 715, 726 (1979) (“[F]ederal law governs questions involving the rights of the United States arising under nationwide federal programs.”). But that does not mean that federal law necessarily applies. See Id. at 727-28 (“Controversies directly affecting the operations of federal programs, although governed by federal law, do not inevitably require resort to uniform federal rules.” (citations omitted)). “Instead, ‘whether to adopt state law or to fashion a national federal rule is a matter of judicial policy dependent upon a variety of considerations always relevant to the nature of the specific governmental interests and to the effects upon them of applying state law.'” Redwing Carriers, Inc. v. Saraland Apartments, 94 F.3d 1489, 1500 (11th Cir. 1996) (quoting Kimbell Foods, 440 U.S. at 728).

         In that scenario, courts must first start “with the premise that state law should supply the federal rule unless there is an expression of legislative intent to the contrary, or, failing that, a showing that state law conflicts significantly with any federal interests or policies . . . .” Ga. Power Co. v. Sanders, 617 F.2d 1112, 1116 (5th Cir. 1980)[1] (citing Wallis v. Pan Am. Petroleum Corp., 384 U.S. 63, 68 (1966)). When deciding whether there is a “significant conflict” between a federal policy or interest and the application of state law, id. at 1117 (quoting Wallis, 384 U.S. at 68), courts consider the following factors: “(1) the need for a nationally uniform body of law, (2) whether the application of state law would frustrate specific objectives of the federal program at issue, and (3) the extent to which application of a federal rule would upset commercial relationships predicated on state law.” Columbia Gas Transmission Corp. v. Exclusive Nat. Gas Storage Easement, 962 F.2d 1192, 1195-96 (6th Cir. 1992) (citing Kimbell Foods, 440 U.S. at 728-29).


         This Court's analysis begins with the language of the Natural Gas Act. See Id. at 1197 (beginning a similar case “with the statutory language”). Section 717f(h) states that “[t]he practice and procedure in any action or proceeding for [condemnation under § 717f(h)] shall conform as nearly as may be with the practice and procedure in similar action or proceeding in the courts of the State where the property is situated . . . .”[2] 15 U.S.C. § 717f(h).

         That language is largely unhelpful and arguably irrelevant. Both parties agree that “the practices and procedures of federal eminent domain actions, including those filed pursuant to the Natural Gas Act, 15 U.S.C § 717f(h), are governed by Rule [71.1][3]and not by state [procedural] law.” S. Nat. Gas Co. v. Land, Cull-man Cty., 197 F.3d 1368, 1375 (11th Cir. 1999); see also ECF No. 69, at 12; ECF No. 81, at 21. That ...

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