North Carolina Ex Rel. North Carolina Department of Administration v. Alcoa Power Generating, Inc.

853 F.3d 140, 2017 WL 1216573, 2017 U.S. App. LEXIS 5691
CourtCourt of Appeals for the Fourth Circuit
DecidedApril 3, 2017
Docket15-2225
StatusPublished
Cited by7 cases

This text of 853 F.3d 140 (North Carolina Ex Rel. North Carolina Department of Administration v. Alcoa Power Generating, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fourth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
North Carolina Ex Rel. North Carolina Department of Administration v. Alcoa Power Generating, Inc., 853 F.3d 140, 2017 WL 1216573, 2017 U.S. App. LEXIS 5691 (4th Cir. 2017).

Opinions

Affirmed by published opinion. Judge Niemeyer wrote the majority opinion, in which Judge Agee joined. Judge King wrote a dissenting opinion.

NIEMEYER, Circuit Judge:

The State of North Carolina commenced this action against Alcoa Power Generating, Inc., seeking a declaratory judgment that North Carolina owns a 45-mile segment of the riverbed of the Yadkin River in North Carolina that, over the past 100 years, Alcoa purportedly acquired by deed and developed, with the construction of four hydroelectric dams to supply electrical power to its aluminum smelting plant in Badin, North Carolina.1

In its complaint, North Carolina alleged that, at the time it attained statehood in 1789, the 45-mile segment of the Yadkin River was navigable and therefore that North Carolina had always “owned and continue[d] to own the submerged bed of the Relevant Segment of the Yadkin River [144]*144in its entirety and [to] hold title to that submerged land in trust for the people of the State.” It alleged further that Alcoa had been using the segment only with North Carolina’s permission and that, when Alcoa announced in April 2010 that it was permanently shutting down its smelting plant and laying off its employees there, conditions changed so as to prompt North Carolina to withdraw its permission.

The district court, in an opinion making findings of fact and conclusions of law following a bench trial, found that the relevant segment of the Yadkin River was not navigable at North Carolina’s statehood so as to give it title to the riverbed as an aspect of sovereignty. The court also ruled as a matter of law that Alcoa successfully proved its title to 99% of the relevant segment under North Carolina’s Marketable Title Act and to the remaining 1% under the doctrine of adverse possession.

On North Carolina’s appeal, we affirm, concluding that the district court did not clearly err in its factual finding that the Yadkin River was not navigable at statehood and did not err in concluding, as a matter of law, that Alcoa has good title to the riverbed.

I

The Yadkin River rises in the northwestern part of North Carolina near the town of Blowing Rock and, for a stretch, flows eastward before flowing southward across the center part of the State to the North Carolina-South Carolina border, where it is known as the Pee Dee River. The dispute in this case involves a 45-mile segment of the river running through Rowan, Davie, Davidson, Stanly, and Montgomery Counties, which Alcoa purportedly acquired by deed and developed.

In 1915, Alcoa constructed its smelting plant in Badin and concurrently began acquiring riverbed land and constructing hydroelectric dams to supply the plant with electric power. It constructed one dam in 1917 in the area of the river known as the Narrows; another in 1919 in an area known as the Falls; and a third in 1927 near High Rock. When it sought to build a fourth dam in 1987 in Tuckertown, it filed a declaration of its intent to do so with the Federal Power Commission (“FPC”) but stated in its declaration its belief that the federal government lacked regulatory jurisdiction because the stretch of the Yad-kin River on which the dam was to be constructed was not navigable. North Carolina agreed with Alcoa’s position, stating to the FPC that the segment of the river “at the Tuckertown project and below is not now and has not been a navigable stream.” The State also represented to the FPC that Alcoa had acquired its riverbed rights “in every respect in accordance with” state law.

Some 20 years later, in 1956, when Alcoa applied to the FPC for a 50-year license for its dams, it again stated its belief that the FPC did not have jurisdiction. Alcoa acknowledged, however, that because the FPC had taken the position that the interests of interstate commerce and foreign commerce would be affected by Alcoa’s activities, it was applying for a 50-year license. Again, North Carolina supported Alcoa’s application and adopted Alcoa’s evidence, which included the deeds by which Alcoa had acquired the riverbed. The FPC granted Alcoa the 50-year license, as requested.

In 2006, when the FPC license expired and Alcoa applied for a renewal, North Carolina again received notice of Alcoa’s claim of ownership of the riverbed and again did not object to Alcoa’s claim.

For decades, Alcoa has paid property taxes on the riverbed parcels it acquired and posted signs on its property prohibit[145]*145ing trespassing. Alcoa has also granted North Carolina permits and licenses to enter its property.

In 2007, Alcoa decided to cease its aluminum smelting operations at Badin, and it ultimately closed that plant in 2010, laying off the plant’s employees. Nonetheless, it continued to seek and obtain renewals of its licenses for the operation of its hydroelectric dams, enabling it to sell at wholesale the electricity produced by those dams.

In response to Alcoa’s closure of the smelting plant, North Carolina commenced this action in 2013 in the Wake County Superior Court. It sought a declaratory judgment that the riverbed of the relevant segment of the Yadkin River was “the sole and exclusive property of the State.” It claimed that Alcoa had been using North Carolina’s property with its permission and that the closure of the Badin plant “so fundamentally changed the basis” of its relationship with Alcoa that North Carolina now wished to withdraw that permission. To support its claim of ownership, North Carolina alleged that the relevant segment of the Yadkin had always been and continued to be navigable in fact and that, as a consequence of the segment’s navigability, it owned and had owned since statehood not only the riverbed of the relevant segment but also the entire river, as an incident of sovereignty.

Alcoa removed the case to the district court pursuant to 28 U.S.C. § 1441(a), contending that the issue of navigability for title was a question of federal law arising under the U.S. Constitution. North Carolina disagreed, however, and filed a motion to remand the case to state court, asserting that its complaint did not state a claim arising under federal law. The district court agreed with Alcoa’s invocation of federal jurisdiction and denied North Carolina’s motion to remand.

The parties filed cross-motions for summary judgment, which the district court denied, concluding that the question of navigability, which was central to the resolution of other issues, could not be resolved without a trial. At a bench trial on this issue, North Carolina presented one witness — Professor Larry Tise, an expert in history — and Alcoa presented four witnesses, three of whom were expert witnesses — Dr. Michael Harvey, a fluvial geo-morphologist; Dr. Mark Newell, an expert marine archeologist; and Dr. Dan Morrill, a historian. Alcoa’s fourth witness was Ray Barham, an Alcoa manager who testified as to Alcoa’s claim of ownership of the riverbed beneath the relevant segment and its activities there.

At the conclusion of the trial, the district court found that North Carolina had not carried its burden of proving that the contested segment of the Yadkin River had been navigable at statehood.

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Bluebook (online)
853 F.3d 140, 2017 WL 1216573, 2017 U.S. App. LEXIS 5691, Counsel Stack Legal Research, https://law.counselstack.com/opinion/north-carolina-ex-rel-north-carolina-department-of-administration-v-alcoa-ca4-2017.