Legislature(2001 - 2002)
04/24/2002 01:44 PM Senate JUD
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SB 309-ADVERSE POSSESSION
SENATOR THERRIAULT said he agreed to introduce SB 309 but it
pertains to an area of statute that he has not dealt with before.
He noted the committee discussion to this point has raised some
interesting public policy calls. He said he is not an expert in
this area but others are here to testify on the legislation.
MR. RUSSELL DICK, resource manager for the Sealaska Corporation,
introduced Mr. John Tillinghast, legal counsel for Sealaska
Corporation and said they would address any technical/legal
issues with this bill.
MR. DICK said that Sealaska is very supportive of SB 309, which
will restrict claims of adverse possession against private
property. Sealaska Corporation is the regional corporation under
the Alaska Native Claims Settlement Act and the largest private
property landowner in Southeast Alaska. Alaska Native
Corporations are the largest private landowners in Alaska in
general. Sealaska has talked with other regional corporations who
indicated their support for SB 309 as well.
MR. DICK explained that lands conveyed to the Native corporations
serve two fundamental purposes: to settle Alaska Natives
aboriginal claims and to meet the social, cultural and economic
needs of Natives, hence these lands are the foundation of Native
people's existence. Congress imposed a prohibition of adverse
possession claims as long as these lands remained in an
undeveloped state. Sealaska felt that was probably good policy
when ANCSA was first created, but many did not recognize how
expansive these land bases would become in the future. ANCSA
didn't consider the degree of development on these lands nor did
it consider the burden that it places on having to actively
police these large, remote landholdings. Sealaska alone has
290,000 acres of land throughout Southeast Alaska with an
entitlement expected to reach upwards of 350,000 acres. The
burden of having to police those lands doesn't serve any public
purpose and seems to Sealaska to be an economic waste. In
addition, Sealaska has a real estate department to purchase non-
ANCSA lands. Those lands do not maintain the same prohibition of
adverse possession claims so Sealaska must deal with that as
well.
MR. DICK said that Alaska has always seemed to respect private
property rights, as there is so little private property in
Alaska: the doctrine of adverse possession seems inconsistent
with that recognition. The state has made itself immune to
adverse possession claims due to the expansive nature of its
lands and the economic burden associated with having to police
them. Sealaska, as a private property owner, is asking for those
same protections.
CHAIRMAN TAYLOR asked if any state allows adverse possession of
state land.
MR. JON TILLINGHAST said to the best of his knowledge, every
state prohibits its land from being taken by adverse possession,
as does the federal government.
CHAIRMAN TAYLOR commented, "And that is because every state has
either the Fifth Amendment that the federal government has or has
an amendment identical to it that the state cannot take land -
the king cannot take land from its citizens without a payment of
just compensation. Right?"
MR. TILLINGHAST said he understood the question to be whether any
state allows land to be taken from the king. They do not. He
thought the policy justification for that is that the state and
federal government own large parcels of remote land and it would
be too much of a burden on the public fist to require the
government to patrol its own lands.
CHAIRMAN TAYLOR said it is also part of the Fifth Amendment that
the king is not allowed to take by adverse possession either. The
king must take land by eminent domain and pay full, fair and true
value and use a formal process. He asked why the state should
afford the same privilege to a private landowner.
MR. TILLINGHAST responded:
Two answers. First, we are also firm believers in state
and private land being treated equally and if you were
going to elevate the one over another, frankly my
ideology suggests that you elevate private land over
public but we're not asking for that, we're just asking
for equal treatment. My understanding is that state
does take land from private people by adverse
possession.
CHAIRMAN TAYLOR said he just learned that the other day and he
does not believe the state or a city or borough should be able to
"take private land by road grader." He explained:
They're taking a ten-foot wide easement and every year
when they grade the road they move a little further out
in the guy's yard. The next thing you know the street's
25 feet wide. They never purchased it. They never
condemned it and took it. They never paid a dime for it
and here the city or the state is enforcing some right
of adverse possession through prescription, some sort
of prescriptive right, because 'well we've used it all
of these years so now it's ours.' I think that is
totally backwards and we should not tolerate it.
MR. TILLINGHAST replied that during the earlier hearings on this
bill, the Alaska Department of Transportation and Public
Facilities (DOTPF) opposed it because it wanted to preserve its
right to take people's private property without paying for it.
Sealaska was shocked.
CHAIRMAN TAYLOR said he wanted that on the record because he was
given that information yesterday and he too was stunned. That is
a major shift in real property law in this state and he is
thinking about drafting legislation to address the problem.
MR. TILLINGHAST remarked that SB 309 will prevent anyone from
doing that. He said the only justification for the doctrine of
adverse possession in Alaska Supreme Court cases is the theory
that if you have an idle capitalist doing nothing with vacant
land, and an industrious worker is willing to squat on it and
grow corn, it is good public policy to let the squatter take the
land. He said in his mind, it is none of the state's business
what a private property owner does with his property. He said he
does not believe any other state has done what SB 309 proposes to
do but Alaska has always been proud that it does not do things
the same way as other states.
MR. TILLINGHAST asserted that ANCSA corporations have enormous
holdings in remote places and the cost of policing those lands to
make sure that squatters are not living on them is huge. It might
be a cost worth bearing if it served a valid public purpose but
it does not. Squatters should not be rewarded by the state for
living on private land. He said if the state wants to send a
clear signal that it respects private property rights, it should
enact SB 309.
CHAIRMAN TAYLOR recounted a case he had that went to the Supreme
Court but was dismissed. He represented a couple that owned a
small house in Wrangell for over 50 years. The couple had loaned
money to their nephew to buy an adjoining piece of property. The
state came along and widened Evergreen Ave., which they lived on.
The state did a survey for right-of-way purposes and found the
lines for all of the lots on the street to be incorrect. The
nephew's lot was a pie shaped piece that took in the couple's
sidewalk, garden and a corner of their house. The neighbors had a
new survey done of the whole neighborhood and "each guy handed
the other guy a quit claim deed" so that they owned their
original pieces of property, except the nephew.
TAPE 02-21, SIDE B
CHAIRMAN TAYLOR then explained the nephew insisted the couple pay
him for the corner of their property at close to the amount the
couple had loaned him. If SB 309 had been enacted, the couple
would have to pay to the nephew, from the day they took
possession, full market value at the current appraisal plus
interest plus the cost of an appraisal. In addition, the couple
would have to pay in a short time frame otherwise ownership would
revert to the nephew. Chairman Taylor said he was able to find
U.S. Forest Service aerial photographs of the land in 1954 and,
coupled with reliable testimony, was able to establish by adverse
possession that the couple had occupied the area of the lot with
the garden.
MR. TILLINGHAST said Chairman Taylor interpreted the legislation
correctly and drew a distinction that the bill itself draws.
Section 1 is the "anti-squatter act," which is aimed at the bad-
faith guy who puts up a shack on land with no legitimate claim or
title. Section 2 involves those situations in which both sides
are proceeding with some good faith, or certainly the adverse
possessor is. The possessor has some claim of title but something
went wrong, such as an erroneous survey. The bill proposes to
keep the doctrine of adverse possession in those instances
because that's where the doctrine does have a legitimate current
use. He suggested in a situation where the adverse possessor is
making a claim under claim of title in which the couple had a
deed but the survey was wrong, the allocation of rents and
payments ought to be discretionary with the court. He noted in
the case Chairman Taylor described, it would be unfair to make
the couple pay.
CHAIRMAN TAYLOR commented that most folks in Wrangell leased
before the 1970s and everything was done on contract of sale,
which was not recorded. He noted that the couple he represented
would not have been able to comply with some of the provisions of
Section 2(a)(1), in which the possessor would need "(C) an
instrument under which the possessor claimed title was recorded
at the time the possessor's claim of title began;".
MR. TILLINGHAST said the intent of SB 309 is to make major
changes to the squatter provision in Section 1. It was not
Sealaska's intent to unduly complicate or change the situations
Chairman Taylor is talking about. He said it may well be that
some of the items in Sections 2 and 3 should be removed and that
it is healthy to take a critical look at the details of Sections
2 and 3 because that has not happened yet. To this point, the
debate has been about Section 1 with the state arguing that it
still wants to take people's land for highways.
CHAIRMAN TAYLOR said he is willing to work with Mr. Tillinghast
on Sections 2 and 3. He noted he has some sympathy for a vast
landowner who must patrol for squatters, but Congress has already
given protection on undeveloped land. He said he owns undeveloped
remote acreage and gets to that property once every year to make
sure no one has put a cabin on it. He believes that is part of
the responsibilities of a diligent landowner. He said he is not
ready to rewrite the property laws on adverse possession yet but
he is willing to look at the other provision. Chairman Taylor
noted that he has hired Mike Wright, an attorney, as committee
staff until the end of the session so Mr. Wright will be
available to provide additional effort in this regard.
SENATOR THERRIAULT commented that his wife had a pro bono case
that was similar to the one Chairman Taylor related so he is
aware that there are instances in which the adverse possession
doctrine has proved useful.
CHAIRMAN TAYLOR asked Jim Cantor to testify.
MR. JIM CANTOR, Assistant Attorney General, Department of Law,
Transportation Section, informed members he was testifying on
behalf of the Department of Transportation and Public Facilities
(DOTPF).
CHAIRMAN TAYLOR noted, for the record, that he discussed this
legislation for an hour the previous day with Assistant Attorney
General Bill Cummings.
MR. CANTOR informed members that DOTPF opposes SB 309 as it
raises two areas of concern. The first is with accommodation
between neighbors, which is more of a problem in rural areas. For
example, a maintenance crew may show up to deal with a drainage
problem and work with the landowner to come up with a solution.
The solution may inadvertently or intentionally involve a pipe
that crosses into another piece of property. Sometimes the
adjoining landowner has given explicit or tacit approval that is
not recorded. Time then passes, the adjoining landowner has moved
on and the new landowner looks at SB 309 and sees a way to
collect money on what was actually done permissively. He noted
there have been many situations where crews in the field work
with landowners and things are done permissively. The current
statute of limitations is 10 years, which would be changed by SB
309, so that a cause of action could exist 30 years later, after
all memory of the arrangement is gone. He noted this situation
primarily arises with drainage issues and driveway linkage
issues.
In regard to Chairman Taylor's comment about the movement of road
right-of-ways, MR. CANTOR pointed out that gravel roads tend to
drift as they are maintained. DOTPF now has a program that local
governments have pushed to put asphalt on gravel roads and those
roads are eventually turned over to the local governments. He
said the initial objection to that program was that all roads
would have to be surveyed. The communities' response was that
they knew the roads were there so they encouraged the state to
put the asphalt on them. Essentially the communities did that
knowing adverse possession claims could be made on the areas
where the road had drifted.
MR. CANTOR noted that SB 309 has no statute of limitations. He
recounted that when he was in law school, he bought a house in
Upstate New York. Before he signed the papers, the lawyers told
him the title had a flaw, that being that a group of investors
bought a large part of the parcel during the Civil War. They
disappeared and no heirs came forward. They assumed the matter
was cleared up by adverse possession by the 1870s. He signed the
papers but, under SB 309, he would have had to worry about record
interests back to the Civil War. Those interests could have been
resurrected. He suggested, on behalf of DOTPF, changing the
statute of limitations to 15 years to give property owners a
little more certainty as to who owns the land.
CHAIRMAN TAYLOR asked Mr. Cantor to forward to his office the
legal theories and precedent cases upon which the state bases its
arguments that it, through inverse condemnation, takes land over
time because a road grader drifts to the outside corner of a road
each time it is graded so that after 15 years the state owns the
property that a private property owner is paying taxes on. He
said Mr. Cummings said some of the judges in this state allow the
state to acquire private property in that way.
MR. CANTOR said he was not versed in the names of those cases but
would look into them and that the theory used in those cases is
the statute of limitations on inverse condemnation.
CHAIRMAN TAYLOR said he is aware that is a positive way for the
state to acquire land at no cost but he does not feel it is
appropriate.
MR. TILLINGHAST said he realizes SB 309 has raised complex
issues, particularly Sections 2 and 3. He asked Chairman Taylor
if the committee would be comfortable allowing Section 1 to move
out of committee so that at least the private landowners of the
state can stop spending money chasing after squatters.
CHAIRMAN TAYLOR replied:
I'm concerned about some of the ways in which the state
itself is using that. We do have properties we have
sold under the state sales. We have now retaken some of
those. There's adverse possession claims within those
too. I just have a general concern about that entire
body of law at this point, Jon, and I'd like to instead
hold the bill, work with you, and work with the state
to see if we can come up with some additional
alternatives. A whole batch of this West was settled by
squatters, most of Oklahoma - they call their football
team the "Sooners" because they got there sooner than
they were supposed to and they squatted on that land.
We used to allow squatters in this state - we called
them homesteaders. Go out and squat on any piece of
land you can and make a house out of it, make a cabin,
clear a little bit of land - if you live there, we'll
give you 160 acres. That's what the federal government
did so I think there's a whole body of law and reasons
why we have something like the adverse possession laws
and I really want to think about this one a little
further before we go forward with it. Thank you very
much Jon, I appreciate it.
SENATOR THERRIAULT said that now that he understands the problems
associated with Sections 2 and 3, he would be agreeable to
dropping those sections, if that is the Chair's desire. He said
knowing that Chairman Taylor is a strong proponent of putting
large amounts of remote land in private ownership, he hopes
Chairman Taylor can see the benefit of Section 1.
CHAIRMAN TAYLOR said he intends to work on Section 1. He then
noted SB 159 was also on today's calendar but Senator Donley
asked that it not be taken up at this time. He then adjourned the
meeting at 2:56 p.m.
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