ANALYSIS OF JULY 5, 2018 SUPREME COURT OPINION

(Posted July 5, 2018) The Supreme Court of Virginia hands down a single published opinion this morning. The parties argued Barr v. Atlantic Coast Pipeline at the end of February; today’s decision ends a three-year battle between several Nelson County landowners and the owners of a Delaware company.

Lawyers and judges are not always universally admired by members of the general public, for a variety of reasons. One of those is the fact that, on occasion, we employ counter-intuitive definitions for ordinary words. Judicial decisions occasionally hold that shall sometimes means may (for a recent example, see Rickman v. Commonwealth from December 2017). The SCV held in February 2015 that the word above in a statute actually means above or below (Landini v. Bil-Jax). Today, a majority of the court rules that in the context of surveying access, the word and actually means or. While judicial decisions explain these incongruous interpretations, the general public usually just shakes its collective head and wonders how anyone could toss aside basic rules of English.

Here’s the setup: Atlantic Coast wanted to enter onto several parcels in 2015 to survey the properties, so it could identify the best route for a planned natural-gas pipeline. By statute, it can ask owners for permission to enter. If they say no, the company can give notice of its intent to enter, specifying the date or dates of entry, and then go ahead and conduct the surveying work.

Atlantic Coast was unable to get these landowners’ permission to enter their parcels, so it sent out notices. To be extra-special-cautious, the company filed a declaratory-judgment petition, seeking a judicial declaration that it had the right to enter. (In my opinion, that’s a very sensible approach.) The owners demurred on two grounds. First, they asserted that the notices gave more than one date for entry, not a single date. Second, they claimed that the surveying work didn’t meet the requirements in the Virginia statute.

The second issue is the real heart of today’s ruling. The relevant statutory text authorizes public service companies to:

make such examinations, tests, hand auger borings, appraisals, and surveys for its proposed line or location of its works as are necessary (i) to satisfy any regulatory requirements and (ii) for the selection of the most advantageous location or route, the improvement or straightening of its line or works, changes of location or construction, or providing additional facilities …

The primary issue in this appeal is the word and, located between parts (i) and (ii). It’s important because Atlantic Coast had only one basis for needing to enter: to select the most advantageous route. The owners argued that the right to enter must be based on both needs – that’s what the word and means – so the absence of a regulatory need means the company had no right to enter before condemning.

A trial judge disagreed and ruled in favor of Atlantic Coast. Today a divided Supreme Court agrees and affirms. Justice Powell writes for the majority. She disposes of the one-date requirement, noting that in last year’s decision in Chaffins v. Atlantic Coast Pipeline had required only “dates certain,” not a single date for performance of all the work. Atlantic Coast’s specified windows were reasonably narrow, and many of them overlapped, so the court finds this aspect of the notices to be appropriate.

As I indicate above, the real issue here is that troublesome and. The majority finds that, viewed in context, the word actually means or here. There are judicial decisions that permit that counterintuitive interpretation, and the court rules today that this situation falls in that class of decisions.

There are four rationales for this ruling. First, the court finds that viewing the requirements as alternatives facilitates the clear legislative intent, which is to permit pipeline companies to create a workable plan to build an important public project. Second, a literal interpretation of and here would render other parts of the statute meaningless. Specifically, some of the statutory reasons for entry occur before construction and some are after; interpreting and as conjunctive would mean that the later-phase work would never be relevant. Third, requiring that work satisfy both requirements would mean that the company couldn’t do any work outside the narrow regulatory requirements; that means that the second requirement would be coextensive with the first, and the company would lose all discretion “for no discernible purpose.” And fourth, the legislature has used and in both the conjunctive and disjunctive forms in the same sentence.

Late last year, the Supreme Court handed down a 4-3 decision in Levick v. McDougal, involving the legitimacy of a wedding that the parties celebrated before they went out and got a license. I found that case utterly fascinating, because of the marvelous back-and-forth between Justice Kelsey’s majority opinion and Justice Powell’s dissent. Today those same combatants go at it again, this time with Justice Kelsey alone in dissent. The exchange is just as vigorous, and just as fascinating to follow, as it was in Levick.

There are several components to the dissent’s argument, but the theme is that taking rights by condemnation is supposed to be hard, because of the importance that we place on ownership of private property. To exercise the right of eminent domain, a condemnor has to follow statutory requirements to the letter.

Justice Kelsey points out that, pursuant to federal law, a pipeline company doesn’t acquire the power of eminent domain until it gets a permit. This company sought access to the owners’ properties long before it got a permit. The dissent points out that last year’s decision in Palmer v. Atlantic Coast Pipeline had noted that companies “vested with eminent domain authority,” are granted the right of entry. That authority doesn’t vest until the company gets a permit, so it can’t exercise the right of entry until then.

The dissent then tackles the four-pronged analysis in the majority. First, the legislature could well have intended that both conditions occur before the company has the right of entry. Second, the phrase regulatory requirements in the Virginia statute doesn’t say “regulatory requirements required to obtain the certificate,” and agencies can require additional surveys after the initial construction. Third, Justice Kelsey practically erupts at the concept that pipeline companies would lose all discretion for no reason:

No discernible purpose? What about the legislative purpose to withhold from a pipeline company the legal license to trespass onto private property when no “regulatory requirements” make it “necessary” to do so …?

Finally, the dissent argues that the use of and in the conjunctive in the same sentence indicates that that’s the natural reading of the word here, too. Substituting a disjunctive use in the other part of the sentence produces an absurd result; interpreting and to mean and in this part is perfectly understandable.

I’ll close by noting two things that aren’t present in today’s opinion. First, in last year’s Palmer decision, the landowner wound up waiving what looked like a killer argument: Virginia law authorizes only Virginia companies to exercise the powers of public-service companies, including the right of entry at issue here. Atlantic Coast is a Delaware company. I expected that objection to be front-and-center here; but no. The landowners raised the objection in their demurrer to the initial DJ action, but when Atlantic Coast filed amended pleadings, the owners didn’t renew it. At some point, the justices will confront what looks like a real barrier to this company’s work here, but this isn’t the case.

The second thing missing is the chief justice, who sat this case out. (Senior Justice Millette sat in for him.) The likeliest explanation for that is the fact that this case originated in the chief justice’s home county, and he probably knew one or more of the appellants, so he recused himself.