Deeds
Clark v CSX Trans, Inc, 737 NE2d 752 (Ind Ct App 2000).
Facts: Property owners in a class action lawsuit claimed an interest in property along a railroad corridor. They alleged the railroad was only granted an easement in the property and the easement was destroyed when the railroad abandoned the property. A subclass of those claiming an interest in property the railroad wanted to sell to the City of Carmel sought a declaration of interests in twenty-three parcels and damages for slander of title. The trial court grouped the different deeds into categories based on similar language.
The trial court held the following deed language conveyed a fee simple estate to the railroad:
1. Granting clause said grantor "conveys and warrants," "Warranty Deed" is the title on the cover and "through" appears in the descriptive clause. Condemnation proceedings were about to begin.
2. Granting clause said grantor "conveys and warrants," the term "forever" is in the habendum clause and the term "right-of-way" appears on the cover.
3. Grantor "convey[s] and warrant[s] . . . a strip of land." The deed is titled "Right Of Way Deed" and provides that "for and in consideration of the benefits to accrue to [grantor] from the location and construction of its railroad and the sum of . . . dollar."
- Consideration equals $425 and "forever" appears in the habendum clause.
- Consideration equals $175 and construction of a fence.
- Habendum clause states "forever." Consi-deration equals one dollar, resetting the fence and providing a wagon road.
4. Language of the granting clause states grantor conveys and warrants a strip of land to the railroad and condemnation proceedings had begun when the deed was created.
The trial court held the following conveyed an easement and not a fee simple to the railroad:
Granting clause states "for and in consideration of a substantial strand barbed wire fence being built on the lines of the right of way described below and the further consideration of one dollar . . . do[es] hereby convey and warrant . . . the real estate." Descriptive clause requires that the railroad keep the fence in good repair and if not "the deed shall be void and of no effect" and that conveyance is for "so long as [the railroad] continue[s] to operate."
Granting clause states "party of the first part, for and in consideration of the benefits to accrue to me from the location and construction of its railroad, and the sum of One Thousand One Hundred Dollar[s] . . . [does] hereby convey unto said party of the second part, its successors and assigns, a strip of land," and title of deed is "Right of Way Deed."
Holding:
1. Affirmed. The phrase "convey and warrant," the title "Warranty Deed" and the absence of any limiting language such as "right-of-way" conveys a fee simple estate. Even though the railroad could only receive an easement through condemnation proceedings, it is inappropriate to consider extrinsic evidence, such as the threat of such proceedings, when the language of the deed is clear.
2. Affirmed. The language on the cover and in the habendum clause are relevant factors to consider in deed construction, but neither is dispositive of the parties' intent. The title itself is not enough to create ambiguity because the language of the granting clause is unambiguous. The language "forever" in the habendum clause confirms the intent to convey a fee simple.
3. Affirmed. A grant of a "parcel" or a "strip" of land without any language further limiting the estate is construed to convey a fee simple estate. A nominal amount of consideration is one element in deed construction that may indicate the parties' intention to create an easement. However, because the granting clause in this particular deed clearly conveys a fee simple, the consideration does not create an ambiguity.
- The value of the property at the time the deed was created is not known therefore the court cannot determine that the consideration indicates an intention to create an easement.
- The consideration is not nominal and does not defeat the unambiguous language granting a fee simple to the railroad.
- Nominal consideration is not enough to create ambiguity when the language clearly conveys a fee simple to the railroad.
4. Affirmed. It would violate the four-corners rule to look beyond the unambiguous language of the granting clause to extrinsic evidence of the condemnation proceedings. The granting clause conveys a fee simple estate to the railroad.
5. Affirmed. Language that the deed would be void if the fence is not maintained creates an ambiguity therefore, because the railroad drafted the deed, it is construed in favor of the subclass. The deed grants an easement to the railroad and that easement was extinguished and when the railroad abandoned the property, therefore the railroad no longer holds an interest in the land.
6. Reversed. An easement is not created just because the words "and warrant" are not present in granting clause. The absence of such language only indicates the owner was not warranting his title and does not indicate an intention to convey less than a fee simple estate.
EDITOR'S NOTE: Under Illinois law, a fee simple estate is conveyed by a deed stating that grantor "conveys and warrants" to railroad "A piece or parcel of a tract of land" upon the express condition "[t]hat said grantee shall construct and maintain ... a grade crossing . . . where [the street] would intersect said right-of-way ... across said right-of-way" and "a culvert underneath its road bed ... [where] right-of-way intersects [the street]." Urbaitis v Commonwealth Edison, 143 Ill 2d 458, 466-67, 575 NE2d 548, 551, 159 Ill Dec 50, 53 (Ill1991). The term "right-of-way" in the deed only serves as a reference to the land itself and does not limit the estate granted to an easement. Id at 469, 552, 54.
Without any other words limiting the estate, the phrase "convey and warrant" is construed to grant a fee simple estate. Id at 467, 552, 54. For more on Illinois deed construction for Railroads, see the Underwriting Manual, Chapter 14.
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