Cengage Advantage Books: Business Law Today, The Essentials 10th Edition by Roger LeRoy Miller

تمرين 7

Town of Midland v. Morris
FACTS The Transcontinental Pipeline transports and distributes natural gas from the Gulf of Mexico to the northeastern United States. The city of Monroe, North Carolina, decided to supply its citizens and the surrounding area with natural gas by constructing a direct connection between its natural gas distribution system and the Transcontinental Pipeline. To construct the connecting pipeline, Monroe needed to acquire the rights to property along a forty-two-mile route. To do this, Monroe entered into an agreement with the town of Midland under which Midland would acquire the property (either by voluntary transfer or by eminent domain) and grant an easement to Monroe. In exchange, Midland would have the right to install a tap on the pipeline and receive discounted natural gas services.
In 2008, Midland began the process of acquiring the property necessary for construction of the pipeline. When negotiations for voluntary acquisitions of the rights-of-way failed, Midland exercised its eminent domain authority to condemn the needed property. Midland filed fifteen condemnation actions, which the property owners (including Harry Morris) challenged. The trial court ruled in favor of Midland, and the property owners appealed. The property owners claimed, among other things, that Midland had not condemned the property for public use or benefit because Midland had no concrete plans to furnish natural gas services from the pipeline to the city and its citizens.
ISSUE Was Midland's condemnation of property to construct a natural gas pipeline a taking for public use even though the city had no immediate plan to furnish gas to its residents?
DECISION Yes. The appellate court affirmed the lower court's decision that Midland had lawfully exercised its eminent domain power.
REASON The court chose to interpret the relevant state statutes broadly rather than narrowly. A narrow interpretation would have limited the city's power to establish a public utility to situations in which the city had a concrete plan to furnish services. Under the court's broader interpretation, it was enough that the city had a plan to develop the infrastructure and capability even if it had no immediate plan to actually furnish the services. The agreement with Monroe gave Midland control over a tap on the pipeline and the right to receive a specific amount of natural gas per day at a discounted cost.
Even though Midland might never tap into the pipeline, the court found that the condemnation satisfied the public use test because it gave the citizens of Midland a right to a definite use of the condemned property. Furthermore, the court reasoned that the availability of natural gas benefited the public by contributing to the general welfare and prosperity of the public at large. "Midland's tap on the Pipeline, and its potential to provide natural gas service, likely will spur growth, as well as provide Midland with an advantage in industrial recruitment. These opportunities must be seen as public benefits accruing to the citizens of Midland, such that Midland's condemnations are for the public benefit."
CRITICAL THINKING-Ethical Consideration Is it fair that a city can exercise its eminent domain power to take property even though the property will not be used immediately to benefit the city's residents? Why or why not?