Judge rules Iowa law unconstitutional in Clay County farmer’s challenge to pipeline

SPENCER — Iowa landowners opposed to liquid carbon dioxide pipelines crossing their property won a legal victory Wednesday, when a judge ruled a state law giving surveyors the right to enter private property is unconstitutional.

Ruling in a Clay County case, District Judge John Sandy said the law violated Iowa's constitution because it does not provide for just compensation for certain damages to landowners for their loss of the right to deny entry onto their land.

“The court can find no other reasonable interpretation in which Iowa Code (section) 479B.15 passes 'constitutional muster,’ ” Sandy wrote in his ruling denying Navigator Heartland Greenway's request for an injunction to allow third-party survey crews access to Sioux Rapids landowner Martin Koenig's property in northwest Iowa.

The ruling is a win for property owners across the state, said Koenig's attorney, Brian Jorde of Omaha, Neb.

“It's a good day for anyone who cares about property rights, and we're hopeful that this momentum continues. It's a significant, significant ruling,” Jorde said.

In a statement, Navigator said it will appeal the ruling because it deviates from precedents established in surrounding states where judges have recently upheld similar survey statutes.

“Navigator plans to appeal the ruling and believes that further review will uphold the constitutionality of the statute, aligning with the conclusions reached by courts in neighboring jurisdictions,” the company said.

“We remain committed to engaging in open and transparent communication with landowners and interested stakeholders. The vast majority of our surveys have been completed through voluntary collaboration with landowners and tenants. We remain committed to upholding the highest standards of safety and integrity in all of our operations.“

Court challenge

Navigator sued Koenig in August after twice being denied entry to his farmland that lies in the route of the company's proposed CO2 pipeline. Koenig responded with a counterclaim challenging the constitutionality of Iowa's right of entry law, and the case proceeded to trial on April 19 in Clay County District Court.

In his legal analysis of the law, Sandy said the statute grants pipeline companies the right to enter private land over Koenig's right to exclude them from his property. Because the law amounts to a government-authorized physical invasion despite the owners' right to exclude, Sandy said, the action is a "per se" taking that calls for just compensation.

Jorde had argued the statute does not provide for payment of damages for that loss of the right to deny entry to private land, only for actual damages to the land caused by surveyors' actions.

Sandy said his review of the law showed that if a surveyor causes actual damages to the property, the pipeline company must cover the damages.

But when non-actual damages, such as those inflicted upon a landowner who has lost the right to prevent people from entering his property, are subjective and not easily determined, the law's definition of actual damages does not cover the “per se” taking that Sandy determined takes place.

“No other construction of the statute, as it currently exists, would render any compensation for damages that are not ‘actual.’ It is in this way that the statute is unconstitutional and incapable, beyond a reasonable doubt of any valid application,” Sandy wrote in his 19-page ruling.

Woodbury case

The ruling was filed as Jorde and Navigator await a judge's ruling in a similar lawsuit in Woodbury County.

Like Koenig, Vicki Hulse denied Navigator's third-party surveyors entry to land north of Moville owned by her and her husband, William.

Navigator sued for an injunction to gain access to the property, and the Hulses responded with a constitutional challenge of the same state law at issue in the Clay County case. They also argue they did not receive proper notification of surveyors' intent to enter their land to perform their studies.

District Judge Roger Sailer in October denied Navigator's injunction request and presided over a one-day trial in Sioux City in March.

  Buy Photo

Navigator’s plan

Navigator has applied for a state permit to build a pipeline through five states that would collect carbon dioxide from ethanol and fertilizer processors in Iowa, Nebraska, South Dakota, Minnesota and Illinois, convert it to liquid form and transport it under high pressure to an Illinois site, where it would be pumped thousands of feet beneath the surface.

Many Iowa landowners have refused to grant surveyors access to their land or sign easements.

Navigator has filed lawsuits against other landowners who have denied access to their property. Those landowners have filed constitutional challenges similar to those in the Koenig and Hulse cases.

"We're hopeful other courts will look at Judge Sandy's analysis and conclude he was right," said Jorde, who represents other landowners. "One or more of these will find their way to the Iowa Supreme Court."

The Navigator pipeline is one of two carbon pipelines proposed to run through the northwest Iowa.

The other pipeline developer, Summit Carbon Solutions, also has gone to court against landowners who have denied access to surveyors to gain an injunction to access the parcels. Landowners in those cases, too, have responded with constitutional challenges.