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Tennessee Gas Pipeline Company, L.L.C. v. Permanent Easement for 7.053 Acres

United States District Court, M.D. Pennsylvania

August 30, 2017

TENNESSEE GAS PIPELINE COMPANY, L.L.C., Plaintiff,
v.
PERMANENT EASEMENT FOR 7.053 ACRES, PERMANENT OVERLAY EASEMENT FOR 1.709 ACRES AND TEMPORARY EASEMENTS FOR 8.551 ACRES IN MILFORD AND WESTFALL TOWNSHIPS, PIKE COUNTY PENNSYLVANIA, TAX PARCEL NUMBERS 097.00-01-24 AND 097.00-01-24.001, KING ARTHUR ESTATES, et al., Defendants.

          MEMORANDUM

          A. Richard Caputo United States District Judge

         Presently before me is the Motion for Partial Summary Judgment (Doc. 27) filed by Plaintiff Tennessee Gas Pipeline Company, L.L.C. (“Tennessee”) in this condemnation action commenced under the Natural Gas Act, 15 U.S.C. 717 et seq. Tennessee seeks summary judgment on certain claims for damages by Defendant King Arthur Estates, LP (“King Arthur”) which Tennessee argues are not recoverable as just compensation under federal law. For the reasons that follow, Tennessee's motion for partial summary judgment will be granted in part and denied in part.

         I. Background

         A. Procedural History.

         Tennessee filed the Complaint in condemnation of property pursuant to Federal Rule of Civil Procedure 71.1 against King Arthur on or about July 31, 2012. (See Doc. 1). In the Complaint, Tennessee sought to acquire a permanent easement and temporary easements (the “Rights of Way”) on properties (the “subject properties”) owned by King Arthur in Pike County, Pennsylvania. (See id.). Prior to the filing of the Complaint, Tennessee owned an existing permanent easement of varying width across King Arthur's property. (See id. at ¶ 15; see also Doc. 3, ¶ 15).

         On October 2, 2012, a Stipulated Order was entered granting Tennessee the right to access and possess the Rights of Way as identified in the Complaint. (See Doc. 10). Tennessee subsequently posted the bond as required in the Stipulated Order and took access and possession of the Rights of Way. (See Doc. 11).

         After the action was administratively reopened, (see Doc. 14), the parties engaged in discovery pertinent to the determination of just compensation. (See, e.g., Doc. 16). Following the close of discovery, Tennessee filed the instant motion for partial summary judgment and supporting documents on July 29, 2016. (See Docs. 27-29). King Arthur's opposition was timely submitted on September 2, 2016, (see Doc. 33), and Tennessee's reply brief in further support of its motion was timely filed on September 20, 2016. (See Doc. 38). Tennessee's motion for partial summary judgment is thus ripe for disposition.

         B. Pertinent Factual Background.

         During the course of discovery, the parties identified and deposed a number of experts pertaining to the determination of just compensation in this action. First, King Arthur retained John McChesney (“McChesney”) as its appraiser to provide a valuation of the subject properties. (See Doc. 28 (Tennessee's Statement of Material Facts (“Tennessee's SMF”)), ¶ 4; Doc. 33-1 (King Arthur's Statement of Material Facts (“King Arthur's SMF”)), ¶ 4). According to McChesney, the subject properties consist of eighteen (18) parcels covering approximately 975 acres and were worth $3, 656, 000.00 prior to the taking of the Rights of Way. (See Tennessee's SMF, ¶ 5; King Arthur's SMF, ¶ 5). After the taking of the Rights of Way, though, McChesney testified that the subject properties are worth $1, 682, 000.00. (See Tennessee's SMF, ¶ 7; King Arthur's SMF, ¶ 7). Moreover, McChesney opined that the value of timber taken from the property by Tennessee was $18, 411.00. (See Tennessee's SMF, ¶ 9; King Arthur's SMF, ¶ 9). McChesney also concluded that King Arthur suffered additional damages as a result of the condemnation of the Rights of Way, including professional fees in the amount of $62, 798.00, development costs totaling $915, 408.00 and timber replacement and reforestation costs of $159, 555.00. (See Tennessee's SMF, ¶ 11; King Arthur's SMF, ¶ 11). Additionally, McChesney testified that the negative market impact as a result of the taking of the Rights of Way equaled $1, 909, 160.00. (See McChesney Dep., 97:25-98:9).

         Tennessee's appraisal expert, Richard Drzewiecki (“Drzewiecki”), opined that the pre-taking market value of the subject properties was $4, 029, 000.00, while the post-taking market value of the properties is $3, 884, 000.00. (See Drzewiecki report, 5). Drzewiecki further opined that it would cost $57, 055.34 to reforest the temporary workspace. (See id. at 66). Drzewiecki also concluded that King Arthur suffered severance damages in the amount of $44, 440.00 as a result of the pipeline easement because “land immediately adjacent to the pipeline will be somewhat less desirable after the imposition of the easement and development of the line.” (Id. at 65).

         Michael Weeks (“Weeks”), a civil engineer, was retained by King Arthur to assess the adverse impacts associated with the taking of the Rights of Way related to Tennessee's installation of the pipeline. (See Weeks Dep., 73:9-20). The adverse impacts identified by Weeks include the construction of water bars, over-clearing and taking outside of the permanent and temporary easements, and the impacts associated with the future development of the property. (See id. at 73:21-74:14).

         King Arthur retained Steven Vitale, PhD (“Vitale”), as an expert to “provide technical analysis of the impact of the gas main on the property.” (See Vitale Dep., 54:3-6). Vitale was asked to assess the impact the pipeline would have on the property in terms of its potential for development. (See id. at 55:17-24). Specifically, Vitale evaluated the impact of the pipeline on properties to be constructed in the pipeline's vicinity. (See id. at 56:14-15). James Leary (“Leary”) was retained by King Arthur to appraise the value of timber and replanting costs associated with the Rights of Way and restoration of the temporary easements. (See Tennessee's SMF, ¶ 28; King Arthur's SMF, ¶ 28). And, lastly, Davis Chant (“Chant”) was retained as King Arthur's marketing, land development, and highest and best use consultant. (See Tennessee's SMF, ¶ 38). According to Chant, the Vitale report alters the highest and best use of the subject properties and that the existence of the pipeline seriously damages King Arthur's ability to sell the properties. (See Id. at ¶ 39).

         II. Legal Standard

         Summary judgment shall be granted “if 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). Summary judgment is appropriate when “the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Wright v. Corning, 679 F.3d 101, 103 (3d Cir. 2012) (quoting Orsatti v. N.J. State Police, 71 F.3d 480, 482 (3d Cir. 1995)). A fact is material if ...


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