If you missed our National Year in Review post, click here.
I am not sure I can remember a year with more agricultural law-related opinions being issued by Texas appellate courts. From fence law to eminent domain, hemp to liability, here are some of the biggest legal stories of 2020 from the Lone Star State.
Dicamba Registration Vacated, New Registration Issued, Lawsuit Filed
Although this is a national issue, and we addressed it in more detail on our National Year in Review post, because it had such an impact on Texas cotton producers, I had to include it on this list as well.
In June, shockwaves were sent across the country when the US Court of Appeals for the Ninth Circuit held that the EPA improperly granted registration for three over-the-top dicamba products. As a result, the Ninth Circuit vacated the federal registration for these products. [Read blog post here.] This resulted in a great deal of uncertainty and confusion about what farmers, most of whom had already planted the seeds and purchased their chemicals. Shortly thereafter, the EPA issued a Cancellation Order for the three pesticides, which included an existing stocks provision. This allowed producers to use any stocks through July 31, 2020 if the products were packaged, labeled, and released for shipment prior to the June 3 decision from the Ninth Circuit. [Read more here.]
In October, the EPA issued a new registration for three of the over-the-top dicamba products for 2021-2025. [Read more here.] The EPA imposed a number of additional restrictions, including a nationwide cutoff date of June 30 for soybeans and July 30 for cotton, an increased buffer requirement, the use of a pH buffering agent, and a simplified label. Additionally, the EPA will no longer allow states to further restrict the federal label through the use of FIFRA Section 24(c), the “special local needs labels.” While expansions may still be allowed under Section 24(c), restrictions will not. Instead, any additional restrictions must be done through Section 24(a). This will require a much slower, more cumbersome process to further restrict the federal label. Essentially, if a state wanted to impose more restrictions than the federal label, as some states have previously done with earlier cut off dates, the state regulators would have to go through a state law or rulemaking process. [Read more here.] In response to this new registration, Plains Cotton Growers and the American Soybean Association filed suit against the EPA, claiming that the new label restrictions were arbitrary and capricious and exceed the EPA’s authority under federal law. [Read Complaint here.]
TX Supreme Court Addresses Fence Law Standard in Pruski v. Garcia
In the first of three major decisions from the Texas Supreme Court, the Justices clarified an issue related to the applicable standard when animals get out onto a US or State Highway. This case arose in Wilson County when a bull escaped and was hit on a state highway. The bull was in a pasture with a gate that was latched, but was not locked, although a lock was present on the gate. The bull’s owner had only had cattle out one time before–approximately 8 years earlier. He was not aware that his bull escaped prior to the accident.
Wilson County has a local stock law applicable to cattle that provides an animal owner may not “permit” an animal to run at large in the county. Under Texas law, an animal owner may not “knowingly permit” an animal to run at large on a State or US highway. And so, the question arose–which of these two standards applied? The plaintiff argued the lower “permit” standard was applicable, while the bull owner argued it was the more stringent “knowingly permit” standard.
The Texas Supreme Court sided with the bull owner, making clear that in a situation where a collision with an animal occurs on a US or State Highway in a county with a stock law, a plaintiff will be required to prove that the livestock owner “knowingly permitted” the animal to run at large in order for the owner to be held liable. Based on the facts of this case, the court held that the plaintiff failed to prove that the bull owner “knowingly permitted” the bull to run at large and, therefore, dismissed all charges. [Read more here.]
TX Supreme Court Reverses Lower Court Rulings for Landowner in SWEPCO v. Lynch Easement Width Case
This case involved a landowner of property encumbered by a blanket easement signed in 1949 allowing the utility company to build an electric transmission line across the property. The line was erected in 1949 and since that time, the company used 30′ total width. In 2014, the utility company began to rebuild and modernize the lines and offered landowners $1000 in exchange for supplementing the existing easement with an express width of 100 feet. The plaintiffs in this case refused the $1,000 offer and contended the company’s use should be limited to the historically used 30′. Both the trial court and court of appeals sided with the landowners. The utility company appealed.
The Texas Supreme Court reversed. The Justices said they would not write a limitation into the parties’ agreement that was not included. “We see no reason to disturb this Court’s…long-standing treatment of general easements in Texas. The starting point of any exercise in easement construction is the same as for contract interpretation: the easement’s plain language. If the easement’s terms are ascertainable and can be given legal effect, courts will not supplant the easement’s express terms with additional terms nor consult extrinsic evidence to discern the easement’s meaning. Parties who enter into easements are certainly capable of writing a fixed width into the easement. That is their prerogative. But as the prior cases demonstrate, sometimes parties to an easement account for anticipated developments in technology and demand by not fixing an easement’s width. The use of a general easement without a fixed width is a strategic decision that does not render an easement ambiguous or require a court to supply the missing term.” [Read more here.]
TX Supreme Court Rules Farm Animal Liability Act Inapplicable to Injured Ranchers & Ranch Hands in Waak v. Zuniga
Mr. Zuniga was killed by a bull while working as a ranch hand for the Waak cattle ranch. His family filed a wrongful death suit against the ranch owners. In response, the ranch owners raised the Texas Farm Animal Liability Act (FALA) as a defense.
The FALA provides that a person is not liable for injuries during a farm animal activity if those injuries are caused by an inherent risk of the activity. The trial court dismissed the case, finding the FALA did apply. The Court of Appeals held that the FALA was inapplicable due to Mr. Zuniga’s status as an employee.
The Texas Supreme Court, in a surprising opinion, held that the FALA does not apply in situations where the injured party is a rancher or ranch hand. Instead, the Court found that the protections of the FALA are confined to “shows, rides, exhibitions, competitions, and the like.” Thus, the FALA was not a valid defense for the Waaks, and the case was remanded for trial on the issue of wrongful death. [Read more here.]
Two Justices issued a strong dissent in the case, beginning with the following language: “As the Court reads the Farm Animal Liability Act, ‘any person’ means only some people. ‘Farm animal activities’ are not covered if they take place on ranches. And not just anybody who engaged in a ‘farm animal activity’ is a ‘person who engages in the activity.’ Who decides whether these limitations exist and how far they extend? Not the Legislature, which did not include any of them in the Act’s text. Instead, courts will decide when the statute’s words mean exactly what they say and when they mean something else. The unfortunate result is that people cannot simply read the Act–and others similarly drafted–and know what it means based on grammar and sentence structure. They must wait to see what the courts make of it.”
First District Court of Appeals in Houston Sides with Landowner in Hlavinka v. HSC Pipeline Partnership Pipeline Condemnation Appeal
In this case, the Hlavinkas own property that they purchased years ago with the primary purpose of generating income by acquiring additional pipeline easements. HSC Pipeline Partnership (HSC) sought to obtain a 30-foot wide pipeline easement across the Hlavinka property. When the parties were unable to reach an agreement on the easement terms, the Hlavinkas filed suit challenging HSC’s eminent domain power. The trial court ruled in favor of HSC on that issue, and at trial for compensation, excluded the testimony of Terry Hlavinka related to comparable private pipeline easement sales on his property. The Hlavinkas appealed.
The First District Court of Appeals in Houston reversed. [Read more here.] First, the court held that HSC did not conclusively establish its “common carrier” status to qualify to utilize eminent domain. The issue before the court was whether HSC proved by a “reasonable probability” that it was a common carrier. The court held that HSCs reliance on one contract shown did not provide conclusive evidence to support common carrier status, particularly in light of there being no other interconnections or potential customers. Thus, it reversed the trial court’s summary judgment on this issue and remanded the case for trial.
Second, the court addressed an important evidentiary issue–can Mr. Hlavinka, as a lay person, offer testimony regarding other private pipeline sales on the property and the fact that the highest and best use of the property was not agricultural use, but use for pipeline developments? The court answered in the affirmative, holding that his testimony was wrongfully excluded by the trial court.
Both parties have filed a petition for review with the Texas Supreme Court.
Corpus Christi Court of Appeals Holds High-Speed Rail Has Eminent Domain Authority in Texas Central Railroad v. Miles
In a contentious battle in Central Texas, the question of whether Texas Central Railroad (TCR) has eminent domain power to take land to build a high-speed rail from Dallas to Houston has been a major issue. In this case, Mr. Miles is a landowner along the proposed route of the high-speed rail, and he was by TCR contacted about providing access to survey his land. Mr. Miles filed suit seeking a declaration that TCR could not conduct the planned survey as they are not a “railroad company” or an “interurban electric railway” that has the power of eminent domain. Mr. Miles bases this on the fact that they have no trains, tracks, and are not operating as a railroad. TCR argues that they are, in fact, a railroad company and interurban electric railway such that they have eminent domain power and, consequently, the right to survey.
The trial court sided with Mr. Miles, holding that TCR met neither definition. TCR appealed.
The Corpus Christi Court of Appeals reversed, holding that TCR has eminent domain because it is both a railroad company and interurban electric railway. Key to this determination was a provision in the Code Construction Act, which states that “words in the present tense included the future tense.” [Read more here.]
Mr. Miles has filed a petition for review with the Texas Supreme Court.
Hemp Production Legal in Texas
Lastly, hemp production is now legal in the state of Texas. In March, the Texas Department of Agriculture adopted its hemp regulations, officially allowing for legal hemp production in the state of Texas. The regulations are lengthy and impose a number of requirements on producers including obtaining correct permits, transport manifests, mandatory THC testing, and destruction of plants exceeding the legal THC threshold. [Read more here or view video here.]