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Quality AG Serv. of Iowa, Inc. v. Burlington N. & Santa Fe Ry.

United States Court of Appeals, Eighth Circuit

October 30, 2015

Quality Ag Service of Iowa, Inc., Plaintiff - Appellant
v.
Burlington Northern and Santa Fe Railway; BNSF Railway Company; Burlington Northern and Santa Fe Railway Company; Burlington Northern Railroad Company, Defendants - Appellees

Submitted September 22, 2015

Appeal from United States District Court for the Southern District of Iowa - Des Moines.

For Quality Ag Service of Iowa, Inc., Plaintiff - Appellant: Bruce Henry Stoltze Sr., Bruce Henry Stoltze Jr., Stoltze & Updegraff, Des Moines, IA.

For Burlington Northern and Santa Fe Railway, BNSF Railway Company, Burlington Northern and Santa Fe Railway Company, Burlington Northern Railroad Company, Defendants - Appellees: Ryan Gene Koopmans, Mitchell Ryan Kunert, Michael William Thrall, Nyemaster & Goode, Des Moines, IA.

Before MURPHY, MELLOY, and SMITH, Circuit Judges.

OPINION

Page 387

MURPHY, Circuit Judge.

The question in this appeal is which party owns a particular sidetrack in Melrose, Iowa. The sidetrack is adjacent to two railroad tracks belonging to Burlington Northern Santa Fe Railway (" BNSF" ) and also to the property of Quality Ag Service of Iowa (" Quality Ag" ). Quality Ag contends that it owns the sidetrack by means of adverse possession due to its continuous possession of the sidetrack from August 25, 2000 to August 25, 2010. BNSF has stored equipment on the sidetrack since one of its trains derailed near it on August 3, 2010.

Quality Ag alleges that BNSF has breached an agreement between the parties. BNSF's motion for summary judgment was granted by the district court[1] after it concluded that the adverse possession claim by Quality Ag was insufficiently pled, that BNSF owns the sidetrack, and that the agreement alleged by Quality Ag lacked consideration. On Quality Ag's appeal we conclude that its claim of adverse possession fails since it did not exclusively possess the sidetrack for at least ten years.

BNSF owns two railroad tracks that run through Melrose, Iowa. In 1994 it sold a parcel of land adjacent to its railroad tracks in Melrose to Farmers Cooperative Association (" Farmers Coop" ). The sale did not include an adjoining sidetrack used to divert railroad traffic off the main tracks. Farmers Coop sold its parcel to Quality Ag on August 25, 2000, and Quality Ag has since used the sidetrack to receive fertilizer deliveries. Its president and owner, Joseph Sinclair, testified at his deposition that a representative of Farmers Coop told him that at the time of the sale the purchased property included the sidetrack. Thus, from August 25, 2000 until at least 2012, its president assumed that Quality Ag owned the sidetrack. Sinclair also testified that shortly after Quality Ag's purchase from Farmers Coop it entered into an agreement permitting BNSF to use the sidetrack if BNSF maintained it. Quality Ag was unable to produce this alleged written agreement.

On August 3, 2010 a BNSF train derailed one hundred yards east of the sidetrack. Since then the railroad has kept equipment on the sidetrack, preventing Quality Ag from using the track. As a result fertilizer deliveries to Quality Ag must be made by truck at increased cost, and Quality Ag filed this action against BNSF. Count I, which has since been dismissed, sought damages due to increased delivery costs and property damage resulting from the derailment. Count II alleges that BNSF has failed to maintain the sidetrack in violation of its contract with Quality Ag.

Although BNSF produced a land survey during discovery which shows it as the owner of the sidetrack, Quality Ag responds that it is the owner because of its

Page 388

adverse possession. The district court granted summary judgment to BNSF on Count II. The court ruled that BNSF owned the sidetrack and that Quality Ag could not prevail on its adverse possession theory because it had not been pled in its complaint. The court also concluded that the maintenance agreement lacked consideration ...


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