PROVIDENCE & WORCESTER COMPANY v. Exxon Corp.

359 A.2d 329, 116 R.I. 470, 1976 R.I. LEXIS 1297
CourtSupreme Court of Rhode Island
DecidedJune 10, 1976
Docket74-309-Appeal
StatusPublished
Cited by14 cases

This text of 359 A.2d 329 (PROVIDENCE & WORCESTER COMPANY v. Exxon Corp.) is published on Counsel Stack Legal Research, covering Supreme Court of Rhode Island primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
PROVIDENCE & WORCESTER COMPANY v. Exxon Corp., 359 A.2d 329, 116 R.I. 470, 1976 R.I. LEXIS 1297 (R.I. 1976).

Opinion

*472 Paolino, J.

These are two appeals from a judgment entered in the Superior Court in two civil actions consolidated for trial and heard together before a justice of that court sitting without a jury. 1

The complaint in the first of the two actions, No. 72-1562, prayed for a mandatory injunction ordering defendants to remove certain obstructions from a right-of-way and permanently enjoining defendants from obstructing the way.

The complaint in the second action, No. 73-2372, prayed for the same mandatory injunction as in the earlier case and also for a declaratory judgment declaring the rights, status and other legal relations of the parties under reservations contained in a deed from plaintiffs’ predecessor to defendants’ predecessor dated August 28, 1941. It is undisputed that this deed, which will hereinafter be referred to as “the 1941 deed,” is the basic document upon which the ultimate resolution of these appeals rests. This complaint also contained a prayer that the court order *473 defendants “* * * to prepare and deliver to Plaintiffs a conveyance of the existing pier and vessel berth.” The pier referred to is the Wilkesbarre Pier, so-called, hereinafter sometimes called “the pier.”

There are many facts which relate to this case in one way or another but, for the sake of brevity, the factual discussion which follows relates only those facts which we perceive to be pertinent to our holding herein.

This case involves a dispute over the rights of several parties to a pier extending from the shore in the city of East Providence into Providence harbor. The pier was constructed during the 1870’s by the Wilkesbarre Coal and Iron Co. and was later acquired by the Providence and Worcester Railroad Company (P&W), the predecessor in interest of plaintiff Providence and Worcester Company, a Delaware Corporation (P&W-Del.). Until the pier was partially destroyed by the 1938 hurricane, it was used primarily as a facility for unloading coal and iron from deep water vessels onto railroad cars. That storm destroyed only the coal-unloading facilities on the pier while the pier itself remained structurally sound.

P&W conducted railroad operations from 1844 until 1888, when it leased substantially all of its real and personal properties, excepting its corporate seal and record books, to the New York, Providence and Boston Railroad Company, the predecessor in interest of the New York, New Haven and Hartford Railroad Company (New Haven). In 1892, P&W executed a new lease of said properties for a term of 99 years to New Haven, thus cancelling the 1888 lease. By the terms of the 1892 lease, New Haven was granted a general power of attorney by which New Haven could “* * * bargain and sell lands and structures of the lessor on such terms as to the lessee shall seem meet * * By the same instrument, P&W agreed to *474 affix its corporate seal, upon New Haven’s request, to all such deeds and conveyances.

The first major transaction under this lease provision regarding the pier that is the subject of this controversy was a deed to the pier and some of the adjoining land, executed in 1941 between New Haven and the Colonial Beacon Oil Company (Colonial). This conveyance was accomplished with P&W’s full acquiescence but it contained a reservation of rights in the pier facility by P&W. The construction to be given to the language of this reservation is the root issue of the present controversy and an understanding of the issue requires the inclusion herein of certain background information which sheds some light on the respective intents of the parties to the 1941 conveyance.

There were three parties who participated in the negotiations which culminated in a sizeable transaction of which the 1941 deed was but a part. These parties were New Haven, Colonial, and P&W and it is the position of each of the parties to the current litigation, who are all successors in interest in some degree to one or more of the three contracting parties, that an examination of the motives of the original parties will dictate a particular construction of the deed reservation and thus a verdict in their favor. This contractual intent is to be gleaned largely from documentary evidence submitted at trial consisting in large measure of correspondence among the principal negotiators for the parties and certain leases of other premises executed among the parties on the same date that the 1941 deed was executed.

Insofar as New Haven is concerned, the following information is pertinent. The pier had been damaged during the 1938 hurricane and was in need of expensive repairs if it was to be returned to its full railroad operating potential. Under the 1892 lease, New Haven would most likely *475 have been found to have had an obligation to P&W to return the pier to such operating condition. However, because New Haven had a comparable facility on the Providence side of the harbor, it was unwilling to spend the money required to effect the necessary repairs to the Wilkesbarre pier. Thus New Haven desired to sell the pier and thus rid itself of the tax and maintenance liability that the pier represented.

Similarly, the circumstances under which the deed was procured indicate that Colonial had a significant interest in having the use of the pier and the appurtenant right-of-way. Colonial owned a petroleum storage depot in the Phillipsdale section of East Providence, several miles upstream from the pier. Because the waters of the Seekonk River were too shallow at that point to accommodate deep water tankers, Colonial was required to use other means of transporting oil from deep water ports to its depot. Accomplishing this task by the use of shallow draft barges was a costly and inefficient process. Colonial desired, therefore, to install a pipeline extending from the deep water vessel berth at the pier to its Phillipsdale depot by way of a right-of-way which belonged to P&W and New Haven and which followed that very route. 2 In this, Colonial hoped to alleviate, to some extent, the competitive disadvantage it suffered in having no direct access to the sea.

P&W’s situation in 1941 sheds considerable light on its intention in including the contested reservations in the 1941 deed. Since 1935, New Haven had been in bankruptcy and its affairs were administered by trustees ap *476 pointed by the United States District Court for the District of Connecticut. P&W, aware that the 1892 lease was subject to possible disaffirmance by the trustees in bankruptcy, sought to participate directly in any negotiations between Colonial and New Haven regarding the pier, to secure an affirmation of the 1892 lease and thus to insure that P&W would not have to commence independent operations.

P&W was aware also that a future disaffirmance of the 1892 lease, pursuant to another reorganization or the termination of such lease by expiration, would require it to operate, if at all, as an independent railroad company. If this ever became the case, P&W would need its own free, direct access to the sea.

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Bluebook (online)
359 A.2d 329, 116 R.I. 470, 1976 R.I. LEXIS 1297, Counsel Stack Legal Research, https://law.counselstack.com/opinion/providence-worcester-company-v-exxon-corp-ri-1976.