Court decides ownership interest in land had been transferred to Railway; ownership did not revert to surrounding owners when railway discontinued

What happens when a railway is abandoned or discontinued?  More specifically, what happens to the rail line property itself?  In a recent decision, the Superior Court in Ontario had to decide whether a Railway had acquired the land for its now discontinued rail line as a full fee simple parcel (ownership of the land) or simply as an easement or right-of-way.  The line had been acquired in 1871 and discontinued in 2002.  In 2004, the Railway agreed to sell the rail line land to the County in which the line was located.  The neighbouring landowners, the successors in title to the original landowners from whom the rail line land had been acquired, challenged the sale.  They took the position that the Railway had acquired nothing more than a right to use the land for a railway; once the railway was discontinued, the land reverted to the neighbouring owners and could not be sold to the County.

The case came to court because the County alleged that the neighbouring landowners had interfered with the County's attempted use of the land (to be incorporated into a recreational trail).  The neighbouring owners intended to use the land for agricultural purposes, and made a counterclaim for a declaration that they were the rightful owners of the land.  The question was whether the original grant in 1871 was a grant of a fee simple interest in the land or of something less, such as a limited grant of rights to use the land.

Registered in 1871 in the Land Registry was a "Conveyance of Line of Way".  As stated in the conveyance, in consideration of the payment of $345.80, the original owners did "hereby ... grant and confirm to the [Railway Company], its successors and assigns for ever" an 8.67 acre portion of the owners' property.  Was that registration sufficient to transfer ownership of the land, such that no interest in the land would revert to the original owners or their successors?  The Court decided the issue on a motion for partial summary judgment brought by the neighbouring landowners.

Justice Grace reviewed the applicable railway legislation in place at the time of the conveyance and determined that the conveyance was a transfer of the fee simple ownership of the land:

The statutory provisions applicable in this case are, in my view, similar to those considered in Lowe.  As long as the acquisition of real property was for a purpose related to the establishment, maintenance and/or operation of a railroad, Canada Southern was statutorily empowered to acquire a fee simple interest in land.  The company could do so by negotiating an agreement with a land owner or in the event of an unwillingness to sell, through a process akin to expropriation. 

Although the conveyance document itself did not specify that fee simple ownership had been "sold" to the Railway, that was the effect of the language in the document in the context of the applicable legislative regime.  

And Justice Grace did not accept the alternative argument of the neighbouring landowners that, even if a fee simple ownership interest in the land had been transferred, that interest would be subject to reversion in the event that use of the rail line was discontinued.  There was no language to that effect in the conveyance document.

Read the decision at: Corporation of the County of Oxford v. Vieraitis.

Lawsuits challenge railroad's authority to OK oil pipeline

Here is an interesting article from AP business writer, Josh Funk, about growing conflicts between railways and neighbouring landowners in the US over pipelines and pipelines royalties: Click here to read the article at PennEnergy.com.  Not all railways hold full ownership over the land beneath their tracks; so who has the authority to grant permission for a pipeline, and to whom is compensation payable?

The Line Fences Act and Abandoned Rail Rights of Way

In 2005, in response to concerns expressed by owners of abandoned rail rights-of-way and the agricultural community the Minister of Municipal Affairs and Housing asked Dr. Wayne Caldwell to consult with key stakeholders to identify the issues, develop possible solutions, build consensus and provide non-binding advice on possible changes to section 20 of the Line Fences Act.  The result was a substantial report on the subject by Dr. Caldwell:

Abandoned Rail Right of Ways (ARROWs) and the need for fencing create a unique challenge for the Line Fences Act. While federal requirements for fencing of active rail right-of-ways are contained in the Railway Safety Act3 the provincial Line Fences Act has jurisdiction over fencing adjacent to ARROWs. Specifically the legislation under Section 20 requires municipal owners (as well as the Crown in right of Ontario and a crown agency and any non-adjacent landowner) of former or abandoned rail right-of-ways to construct and maintain, in perpetuity, all fences adjacent to all ARROWs that have come into municipal ownership.

The requirement of the legislation that fencing be provided by municipalities has become an issue from two perspectives. From municipalities’ perspectives there is a concern that they will be required to provide and maintain miles of unneeded fences. From an agricultural perspective some municipalities have been reticent to fulfill their obligations and some farmers have been forced to resort to the courts to ensure that appropriate fences are constructed. Amidst these two issues are a myriad of subtleties that will be explored later within this report.

In response to municipal and agricultural concerns the province initiated this study with the following three goals:

􀂃 To identify all issues related to line fence responsibilities on abandoned rail rights-of-way and develop possible solutions.

􀂃 Seek to build consensus on possible solutions to issues and to identify areas where no consensus has been reached.

􀂃 To provide non-binding advice to the Minister on improvements to section 20 of the Line Fences Act and on other actions that may provide relief to the issues identified.

Read the full report at: The Line Fences Act and Abandoned Rail Right of Ways.

CBC News - Saskatchewan - Sask. farmer sues over payments to railways

CBC News - Saskatchewan - Sask. farmer sues over payments to railways

CBC reports on a proposed class action lawsuit commenced by Saskatchewan farmer, Gordon Wallace, who alleges that Canada's major railways have overcharged farmers for maintenance of railcars since 1983.