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Court of Appeals Finds that Utilities Can Establish Prescriptive Rights in Private Property More Easily Than Other Companies

The Wisconsin Court of Appeals recently decided a case regarding the rights of utility companies to gain prescriptive rights over private property by using it over time.  Williams v. American Transmission Co., LLC, 2007 WI App 246.  American Transmission Company (ATC) maintained electric power poles and transmission lines on a certain portion of property pursuant to a 1969 revocable agreement with previous owners.  When the Williams purchased the property in 2003, they sought a claim of inverse condemnation against ATC to force the removal of the poles and transmission lines.  The Court of Appeals found that ATC had established a prescriptive right to continue use of the property because it had been using the property for more than 10 years.  Therefore, the Williams could not maintain their inverse condemnation action.

The Court decided that section 893.28(2), which generally applies only to utility companies, applied to the situation because the 1969 agreement established "use of rights in the real estate of another," even though the agreement was revocable and the use was "non-adverse." In effect, the 1969 "revocable" property agreement became irrevocable simply by the passage of time.

In contrast, the statute that establishes the prescriptive rights of non-utilities, section 893.29(1), requires that the use be "adverse."  In addition, utilities need only establish continued use for 10 years or more, while others must establish continued adverse use for at least 20 years.  In application, these differences grant utilities far greater prescriptive rights than those held by other private parties, resulting in utility companies being treated more like public entities, with fewer restrictions on their ability to establish prescriptive rights.

The Court did not rule on whether the transfer of rights to ATC without compensation to the Williams raised a constitutional issue of "taking" private property without just compensation, as the issue was not presented by the parties, setting up another possible defense to similar claims in future cases.

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