Pleadings Filed By The United States Forest Service Put Company On Notice That Its Claim Of Easement Was In Dispute, Thus Triggering The Twelve-Year Statute Of Limitations Under The Quiet Title Act
WISCONSIN VALLEY IMPROVEMENT COMPANY v. UNITED STATES OF AMERICA (June 22, 2009)
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Wisconsin Valley Improvement Company (“WVIC”) operates dams on the Wisconsin River, some of which are licensed by the Federal Energy Regulatory Commission. Years ago, during a license renewal process, the U. S. Forest Service asked the Commission to impose conditions on the WVIC license that would curtail certain flooding on federal land. WVIC claimed that it had prescriptive easements over the federal lands that made the requested conditions inappropriate. In a brief filed with the Commission in February of 1996, the Forest Service explicitly did not concede the easement claim but argued that it had a right to the conditions regardless of the existence of a valid easement. The matter was resolved on the grounds that the existence of an easement was irrelevant. Thus, the issue of the easement’s existence was not resolved. In June of 2008, WVIC filed suit under the Quiet Title Act to establish their flowage easement. The district court concluded that the suit was not filed within the twelve-year statute of limitations of the Quiet Title Act because the claim accrued no later than the filing of the February 1996 brief. It dismissed for lack of subject matter jurisdiction. WVIC appeals.
In their opinion, Chief Judge Easterbrook and Judges Sykes and Van Bokkelen affirmed, as modified. The Court noted that a claim accrues, for purposes of the Quiet Title Act, when a person knows or reasonably should know that the United States maintains an adverse claim to property. Although the Court recognized that there was no evidence that the Forest Service ever flatly forbade the flooding of its lands, it agreed that its refusal to concede the issue in the Commission briefing was enough to lead a reasonable person to conclude there was a potential dispute. That knowledge is enough to trigger the period of limitations. The Court did take issue with the district court's characterization of the issue as jurisdictional. Subject matter jurisdiction is granted by federal law -- statutes of limitations do not detract from a federal court’s authority to decide the issues. The Court affirmed the judgment as modified to a dismissal with prejudice.
