Iowa Supreme Court Takes Conservative Approach to Airspace Hazards

Iowa farm grain elevators have height restrictions near airports

Restrictions on land use near an airport are important for obvious reasons. Tall objects create hazards to ascending and descending aircraft, and local land uses that attract large numbers of people produce a greater risk of injury if something does go wrong on take off or landing. Various methods exist to limit building height and land uses; the most familiar are local zoning ordinances. 

The Federal Aviation Administration (FAA) has also enacted rules for airports, known as the Part 77 rules. These rules help ensure the safe operation of the airport by describing “imaginary surfaces” above and around the airport that cannot be penetrated by obstructions like buildings or trees. The rules require that any proposed construction within certain distances from an airport be submitted to the FAA for a hazard determination. Until the FAA performs its assessment, construction is prohibited. The regulations permit the FAA to determine that an obstruction may not be a hazard even if it penetrates a Part 77 surface, if certain mitigating measures are taken.

The Iowa Supreme Court recently decided a case, Carroll Airport Commission, v. Danner, in which local farmers (the Danners) wanted to build a  twelve-story grain leg (bucket elevator) in the flight path of the Carroll, Iowa, municipal airport.  Unbeknownst to the Danners, the airport commission had adopted zoning regulations that limited the height of structures in the vicinity of the airport. The regulations generally match the Part 77 height restrictions. The Danners began construction before notifying the FAA or the airport of their plans. 

 A local airport commissioner saw the Danners’ construction taking place. The commission then told the Danners that the grain leg violated airport zoning regulations and would not be approved. The commission also asked the FAA to perform a hazard evaluation under Part 77. Though the proposed elevator leg exceeded the Part 77 height limits, the FAA made a “no hazard” determination “on the condition the farmer paint it and place blinking red lights on top.”  Despite the “no hazard” determination, the commission refused to grant a variance from its zoning height restrictions and sued to require the elevator leg be torn down as a nuisance. The Danners defended the suit on the basis that, once the federal agency made a “no hazard” determination, that ruling took precedence and the commission was preempted from enforcing a more rigorous requirement.

The Iowa Supreme Court had to decide whether the local airport zoning could be enforced even though it was more exacting than the FAA’s determination. This raises the question of when a federal government action preempts local regulation. The answer implicates the Supremacy Clause of the U.S. Constitution:

This Constitution, and the laws of the United States which shall be made in pursuance thereof; and all treaties made, or which shall be made, under the authority of the United States, shall be the supreme law of the land; and the judges in every state shall be bound thereby, anything in the Constitution or laws of any State to the contrary notwithstanding.

Article VI, Clause 2, United States Constitution

The Supremacy Cause makes federal law the supreme law of the land, which controls over conflicting local law. This leaves open the possibility that local law is enforceable where it does not conflict with federal law. After analyzing the federal regulations, case law, and Iowa law, the Iowa Supreme Court determined there was no conflict between federal and local law here and, in fact, the federal laws contemplated that local rules could be more restrictive. In conclusion, the Court upheld the commission’s finding that the grain leg was a nuisance and a hazard to air navigation and ordered the structure removed.

Eminent Domain and the Bakken Pipeline Redux

Iowa farm land

The Dakota pipeline carries oil from North Dakota to Illinois through Iowa, but does not pick up or drop off product in this state. A while back, I wrote a post about the pipeline and the fight over the use of eminent domain to acquire Iowa land for its construction. That post noted that in May 2016, the Iowa Utilities Board (IUB), over the objections of certain environmental groups and landowners, granted the pipeline company a permit for the pipeline’s construction. The IUB found that the pipeline would “promote the public convenience and necessity,” in the language of the statute. The IUB then granted the company the right to use eminent domain if necessary to acquire right of way for the project. The objectors appealed to the Iowa district court, which upheld the IUB’s ruling. The objectors then appealed to the Iowa Supreme Court, which issued its ruling on May 31, 2019, upholding the IUB’s decision, 4-3.

The initial question the Court needed to answer was who, in the first instance, decides whether a project “promotes public convenience and necessity,” the agency or the courts.  The Court found that the legislature intended that the IUB be the body that determines what projects meet the test. That being the case, on judicial review of the agency’s decision the courts, following general principles of administrative law, do not remake the determination. Instead, the courts review the IUB’s decision to ensure that it was not “[b]ased upon an irrational, illogical, or wholly unjustifiable application of law” and that its factual determinations were supported by “substantial evidence.”  The Court held the IUB’s ruling had met the tests; that is, it was rational and based on the evidence presented. 

Next, the Court took on what it called the most significant issue in the case: whether the use of eminent domain for the Dakota Access pipeline violated the Iowa Constitution’s prohibition on taking private property except for public use. The Court’s focus was on whether the public benefits of a project must be direct or whether indirect benefits are enough. In that regard, the Court found that, even though Iowans could not directly access the pipeline, the pipeline provides beneficial side effects in the form of cheaper and safer transportation of oil, which in a competitive marketplace results in lower prices for petroleum products for all, including Iowans. The Court noted that Iowa benefits significantly from lower fuel prices pointing out the very interesting facts that, “Iowa is fifth in the country in per capita energy use [and] eighth in the country in per capita gasoline consumption.”

The decision was not unanimous, however. Justice Wiggins, joined by Justice Appel, dissented, arguing that the use of eminent domain to acquire the necessary right of way for the pipeline that simply runs through the state is not authorized by the Iowa constitution “because the Iowa public cannot use and does not derive a direct benefit from it.” He argued that the indirect or secondary benefits to Iowa relied on by the IUB are not sufficient.

Justice McDonald also dissented, but on the grounds that the case was moot. By the time the case got to the Supreme Court, the pipeline was built and operating. Therefore, there was nothing meaningful for the Court to do. Or, as Justice McDonald put it, “What’s done is done.”

Agricultural Leases, or A Horse is a Horse

A single horse

A horse, a horse! My kingdom has a horse.*

If you have been following the United States Senate hearings on the nomination of Judge Neil Gorsuch for the Supreme Court, you may have heard some discussions about how judges should read statutes and the constitution. Without getting too technical, while at the same time trying to avoid the risk of oversimplification, the Senators have been talking principally about two schools of thought. One is that judges should read the words and apply them, period, whatever the result. The second school is that judges should read the words in the context of the problem the writers were trying to resolve and give them a meaning that the writers intended, or would have intended if they had foreseen the problem in the case before the court, even if the writers did not use exactly the right words.

The Iowa Supreme Court last month decided a case that is an instructive example of how these two theories play out when courts read statutes that, if applied according to their plain meaning, could lead to absurd results. The case involved a statute addressing the definition of agricultural leases. The particular question was, “Does a single horse make a farm?”  Porter vs. Harden (Iowa S. Ct. No. 15–0683, Filed March 10, 2017 Amended March 13, 2017). In answering the question, the majority of the court employed the context based rule whereas the dissent, and the Iowa Court of Appeals before it, employed the plain meaning rule.

The question arose in the setting of a lease termination and the answer was important because Iowa law gives tenants differing protections depending on the type of property being leased and the duration of the lease. For example, residential tenants are given more protections than commercial tenants because generally residential tenants have much less bargaining power and sophistication than commercial tenants who have the means to negotiate with their landlords.  

Farm tenants, since 1939, have been given certain statutory protections because of the seasonal nature of the business and the historical importance of agriculture to Iowa. Particularly, in terminating a farm tenancy, the landlord must follow timelines set by the legislature.  Generally, the law requires written notice of termination to be given on or before September 1, with termination to occur the following March 1. This assures that there is sufficient time for the tenant to harvest growing crops and for the parties to negotiate a new lease or find other land to rent, or find another tenant. A 2006 amendment to the statute added grazing to the existing list of agricultural activities.

The parties in the Porter case had a month to month lease. In those cases, either party has the power to cancel the lease by giving 30 days notice to the other party, if the subject of the lease is not agricultural land. Porter, the landlord, gave Harden, the tenant, notice that it was canceling the lease in 30 days, thus following the legal requirements for terminating a month to month lease. The tenants on this six-acre property, which was their primary residence, claimed they were entitled to the much longer notice required to terminate a farm tenancy because they had a horse grazing on the property. They claimed that a close reading of the statute regarding farm leases required only one grazing animal to qualify the property as a farm. The district court did not agree and ruled in the landlord’s favor saying, “the keeping of one 38-year old horse does not make this a farm tenancy.” The tenant appealed.

The Iowa Court of Appeals reversed the district court and ruled that, even though it might be an absurd result, as the statute was written, the definition of livestock “means an animal …”. Reading the statute strictly, one old horse could make a farm tenancy.  The landlord asked the Supreme Court to review the Court of Appeals’ decision.

The Supreme Court looked again at the statute and decided the Court of Appeals was reading the statute too literally. To determine what the legislature meant required reading the statute in context of its purpose as well other statutes addressing the same or similar subject matter. It then said, “just as we would not conclude that someone with a small vegetable garden ‘produces crops . . . on the land’ …, we think it would be questionable to hold that someone keeping an old mare at the homestead ‘provides for the care and feeding of livestock on the land’ within the meaning of the same statute.”  

The Court emphasized that it would assume the legislature intended a reasonable interpretation of the statute and imprinted a primary purpose test on the statute. That is, one must look at the property to see if its main object was the growing of crops or the feeding of livestock. By accepting the “one old mare” argument, any tenant anywhere could create a farm merely by bringing an old horse or a few chickens onto the property. Probably not what the legislature intended.

However, one justice dissented essentially adopting the Court of Appeals reasoning. When a statute’s language is plain and unambiguous, a court should look no further than the statute. Here the statute says “an animal.” Even though the result may be absurd, it is up to the legislature to fix it, not the courts. The courts have only to apply the statute as written, even if poorly written. If the legislature does not like the result, it can rewrite the statute.

If you have questions about this case, or other issues involving leases, you need not hesitate to contact us.

Apologies to William Shakespeare’s play, Richard III,  Act-V, Scene-IV.