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3rd Cir. Trips Over Meaning of 'Replace' in Gas Line Easement

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By William Peacock, Esq. on October 01, 2014 3:19 PM

The majority said that this was a "straightforward" case: Columbia Gas Transmission has the "right of eminent domain to obtain easements over the land of objecting landowners, outside of the existing right of way, in order to replace deteriorating pipeline."

And yet, the dissent (and the district court) felt that this was far more complicated, because it depends on how you define "replace" -- replace in place, or replace and reroute, up to a mile from the original location of the gas line. (H/T to The Legal Intelligencer.)

Who said law can't be interesting?

Defining 'Replace'

To anyone who has ever read or drafted a statute, it might seem ridiculous that you'd need to define every word in the text. But if you don't, this is exactly what can happen.

According to the opinion, Columbia has already replaced 95 percent of Line 1655, but installation of the last 1,000 feet is stalled because the gas company decided to relocate the line away from its heavily populated original location to a new location, up to a mile away. However, the landowners who own the land that will be crossed by the new path refused to negotiate an easement, which led to these condemnation proceedings.

The issue is simple to spot, but hard to solve: If Columbia is merely replacing "existing facilities" (including gas lines), it can do so, and obtain the necessary condemnations via eminent domain, with no issue whatsoever, thanks to The Natural Gas Act, 15 U.S.C. § 717f(h) and its existing Federal Energy Regulatory Commission (FERC) certificate.

The district court, arguing that the regulations were ambiguous as to the meaning of "replace," adopted its own interpretation, sourced from an obscure "notice of "proposed rulemaking" for "Emergency Reconstruction of Interstate Natural Gas Facilities" promulgated by FERC after 9/11. It held that the word "replace" is a "term that generally does not imply significant relocation."

But the majority here disagreed. Judge Marjorie Rendell explained: "The meaning of 'replace,' as commonly understood, is not so limited. One replaces electrical wiring in a house, for example, by removing worn out or obsolete wires and putting in new ones, even if the new wires are routed differently from the original wires."

Dissent: Ambiguous, Dangerous

Judge Kent A. Jordan wrote a dissent agreeing with the district court. He argued that the mere fact that they are having this discussion shows that "replace" is ambiguous, and requires the court to look at how FERC itself has interpreted the term. (Hence, that little obscure proposed notice of rulemaking.)

Like any good dissent, Jordan also warned of the far-reaching consequences of the majority's "limitless reading of the regulations," which he called "problematic" and "constitutionally suspect":

The Majority manages to turn those limiting regulations [requiring FERC certificates, hearings for landowners, etc. on new projects] into a grant of limitless authority to natural gas companies for basically the same activity as long as that activity is labeled a 'replacement.' The approach adopted today allows a gas company to bypass all notice-and-hearing requirements by tying its proposed project to the originally authorized pipeline, even if that authorization was provided decades ago and in an entirely different location. No consideration is given to the rights of newly affected parties. That is fundamentally at odds with regulations requiring notice and an opportunity to participate in certificate hearings.

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