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CURB is holding a public meeting on 29 June 2017 at Westlake Library, starting at 6:00PM 

Read the 24th Edition of CURB Update our bi-monthly newsletter.

"They [Appalachian Power] absolutely have the right to destroy Nissens' [or anyone’s] dock for whatever reason they want. It is stupid, but people can make foolish contracts." -- Judge James Reynolds Franklin County Circuit Court

Franklin County Circuit Court Justice Reynolds, on 11 April decided Pressl v APCO in favor of APCO; and on 16 June decided APCO v Nissen, in APCO’s favor. Both cases concerned the retained property rights of shoreline property owners on Smith Mountain Lake. Both decisions were grievously wrong and will be appealed before the Virginia Supreme Court. C.U.R.B. is criticizing the decisions, not Judge Reynolds personally, nor will C.U.R.B. impugn his integrity – that’s a line we will not cross.

Judge Reynolds determined Appalachian Power has the ‘unbounded’ right to enter upon any SML shoreline property and "cut, burn and/or remove" any structure, at any time, for any reason, or for no reason at all. With this ruling, the court disregarded decades of binding Virginia easement and contract law. An easement is a contract, which reserves to the landowner residual land rights. APCO cannot legally take owner residual rights by unilaterally changing the use of the easement beyond its original purpose. Those residual rights include access to the navigable waters of the lake using docks.

Prior to 1959, APCO began purchasing flowage easements from shoreline landowners to build a dam for hydro-power generation and for the right to clear land for the impoundment of water, period.

The court wrongly ruled APCO’s limited flowage rights are now so expanded that APCO effectively owns Nissens’ and Pressls’ property. Virginia easement law disagrees. Nissens and Pressls pay taxes on their land, not APCO. The flowage easement is a contract; a privilege to flood Nissens’ land, and the Nissens retained their right to use their land, so long as they do not prevent APCO from flooding and generating electricity.

The over-arching principle of contract interpretation is to determine the parties’ intent leading into, at the time the contract was made, and the conduct of the parties after the contract was made. APCO’s 1960 license had no requirement to regulate shorelines and APCO regulated nothing, until after 2003. APCO speculated in SML real estate, making millions of dollars selling lakefront property; promised flowage easement grantors recreational access as compensation for granting the easement; encouraged landowners to build over 6,400 docks, commercial marinas, restaurants, slip rentals, homes and condos; insisted that local government was responsible for regulation of shoreline construction; and APCO has never sought nor obtained a court order to remove anything, until now. None of these material facts were considered by the court.

Instead Judge Reynolds rationalized, “people sign bad contracts/easements all the time,” implying that all landowners in 1960 understood if they built a dock, that APCO could come later "to cut, burn and/or remove" their dock, their marina, their business, even their home. Western Virginians in 1960 were country-folk, but none were this stupid. (Yes, there are many homes built within the project.). Judge Reynolds ruled that APCO can tear out your dock or any structure in the project.

This ruling means any structure along the shoreline can be ‘cut, burned and/or removed’ at APCO's discretion, placing over One Billion Dollars of private investment at risk, even if landowners sign APCO’s permit. The APCO permit includes all future changes to the APCO’s federal license (the easement does not). APCO has zero federal regulatory authority, unless a landowner is foolish enough to sign a permit and subject themselves to APCO’s federal license.

Legally, since APCO disregarded what they now assert is an 'unbounded' right to remove anything [which they never had] for almost 5 decades, APCO lost those rights. This basic, well understood and enforced legal principle is called 'The Doctrine of Latches.’

Judge Reynolds repeatedly referenced Judge Moon's vacated and reversed decisions. Recall this federal district court judge ignored the U.S. Constitution’s limitation that federal courts only have jurisdiction in civil actions arising under the Constitution, laws, or treaties of the United States. The U.S. Fourth Circuit Court of Appeals ruled that APCO has NO federal regulatory authority and that a property owner cannot violate federal law because FERC only regulates APCO. This is legal precedent Judge Reynolds chose not to follow.

Judge Reynolds ignored that many 'material facts' were unresolved and in dispute, yet granted summary judgement anyway -- a violation of Virginia Supreme court case law and procedure/code that precludes a court from granting summary judgement under such circumstances. APCO was entitled to summary judgment only if there were no material facts genuinely in dispute. Utilizing summary judgment in complex cases like this, particularly where motive and intent are involved, is inappropriate. In considering a motion for summary judgment, the court must adopt those inferences from the facts that were most favorable to the Nissens.

It was evident from Judge Reynolds' demeanor, that he was uncomfortable, and conflicted when he became aware of facts and law he had not previously considered. It did not appear he had studied the briefs or supporting case law and likely had decided prior to the hearing. Judge Reynolds had the opportunity and every legal reason to deny APCO summary judgement. But he chose not to, because he had boxed himself in with the extremely premature and wrongful dismissal of Pressls' case on a demurrer. He acknowledged Pressls’ case was under appeal to the Virginia Supreme Court. So, he punted and said, I'll let the Virginia Supreme Court decide this on appeal. Then he denied APCO's demand they be granted the right to 'cut, burn, and/or remove' Nissens' dock, until the Va. Supreme Court rules. APCO's legal counsel asked the court to deny the Nissens' from occupying and using their dock. Judge Reynolds said he would not prevent the Nissens from using their property [perhaps the flowage easement does not give APCO fee simple ownership after all].

Taking property without paying is theft. Claiming one has federal regulatory authority, when it has none, is a lie. Coercing a landowner to sign a permit claiming federal regulatory authority, when untrue, is extortion. 

CURB has faith in the superior court's adherence to Virginia law and will require Judge Reynolds to recognize shoreline owner rights under the 1960 easement.

All Property Owners Should be Concerned
Over $1.0 Billion in Private Investment is at Risk

Judge Reynolds clearly does not recognize the impact his decision holds for SML property owners.  In its second lawsuit against Nissen, APCO wrote “APCO has decided not to remove some structures at Smith Mountain Lake.”  This is absurd and false. There are thousands of structures and improvements (unidentified to FERC) built without an APCO permit, below the 800-foot contour, known as 'encroachments.'  These encroachments include: marina work buildings, marina boat slip rentals, restaurants, golf course greens and holes, the 36-unit Vista Pointe Resort, swimming pools, decks, homes and parts of homes, the causeway to Contentment Island, well-over 1.5 million linear feet of riprap, seawalls, bulkheads, beaches, access paths/roads, private boat ramps and some 6,400 residential docks.  The judge believes the flowage easement is nearly the equivalent of fee ownership and APCO can remove anything?  If this were true, (which it is not according to the Va. Supreme Court) then every property owner has just had his property below the 800-foot contour seized, without being compensated.  Judge Reynolds’ dismissal of Pressls' complaint places over $1B of improvements at the risk of changing FERC requirements and APCO’s discretion.  Consider the losses if APCO removed Vista Point Condo's ($10,8M+), all riprap ($150M+), 6,400 residential docks ($480M+), these alone would amount to over $640,000,000. The loss of residential and commercial property values would be enormous, and all future investment and economic growth would end.