Easement

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7^th Circuit Court of Appeals

Case Name: Stephen R. West v. Louisville Gas & Electric Company, et al.

Case No.: 19-2442

Officials: BAUER, EASTERBROOK, and HAMILTON, Circuit Judges.

Focus: Easement

This appeal presents a question about how 47 U.S.C. §541(a)(2), part of the Cable Communications Policy Act of 1984, affects use of a utility easement in Indiana. In 1938 a predecessor of Stephen West granted a perpetual easement to a predecessor of Louisville Gas & Electric Company, permitting it to build and maintain a 248-foot-tall tower carrying high-voltage electric lines. (Ownership of both the underlying land and the easement has changed hands since 1938. For simplicity we refer to the current owners.) In 2000 Louisville Gas permitted Charter Communications to install on the towers a fiber-optic cable that carries communications (telephone service, cable TV service, and internet data). Louisville Gas asked in 1990 for explicit permission to do this, and West refused. In 2000 it concluded that the existing easement allows the installation of wires that carry photons (that is, fiber-optic cables) along with the wires that carry electrons. West disagreed and filed this suit under the diversity jurisdiction, seeking compensation from Louisville Gas, under Indiana’s substantive law, for the addition of the new cable.

It is easy to imagine a rule of state law under which only the most explicit language in an easement dedicates the land to any given use— and it is equally easy to imagine a rule of state law that reads easements more broadly. Where does Indiana stand? The answer is that Indiana is permissive. It treats easements as permitting new uses compatible with the original grant. See Howard v. United States, 964 N.E.2d 779, 783 (Ind. 2012) (“a new use that is compatible with the original purpose is within the scope of the easement”) (emphasis in original), relying on Fox v. Ohio Valley Gas Corp., 235 N.E.2d 168 (Ind. 1968). “The owner of an easement, known as the dominant estate, possesses all rights necessarily incident to the enjoyment of the easement. The dominant estate holder may make repairs, improvements, or alterations that are reasonably necessary to make the grant of the easement effectual.” McCauley v. Harris, 928 N.E.2d 309, 314 (Ind. App. 2010) (internal citation omitted). See also Rehl v. BilleI, 963 N.E.2d 1 (Ind. App. 2012). What’s more, most states permit the holder of an easement to allow third parties to use rights available under the easement. See Restatement (Third) of Property (Servitudes) §5.9 (2000). We have not seen anything to suggest that Indiana would reject that principle.

So as far as we can tell, then, the use that Louisville Gas and Charter have jointly made of the easement is permissible under Indiana law. At least the air rights have been “dedicated” to transmission, and a telecom cable is “compatible” with electric transmission. Both photons and electrons are in the electromagnetic spectrum. Now that West and Louisville Gas have settled their own differences about the scope of the 1938 easement, there is no basis for any relief against Charter. Whether other states’ laws, or other situations (such as an easement for a buried gas pipeline being used as the springboard for a cable company to build towers and string lines above the corridor), would justify a more restrictive reading of what has been “dedicated for compatible uses” is a question for some other case.

Affirmed

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Derek A Hawkins is trademark corporate counsel for Harley-Davidson. Hawkins oversees the prosecution and maintenance of the Harley-Davidson’s international trademark portfolio in emerging markets.