Court of Appeals of Indiana rules on I&M’s use of eminent domain

Published: Jul. 21, 2022 at 5:48 PM EDT
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SOUTH BEND, Ind. (WNDU) - Did a local power company misuse its power?

Indiana’s Court of Appeals has a constitutional problem with the recent use of eminent domain on the part of Indiana Michigan Power.

The sharply worded ruling states that “property owners have a right to defend against subterfuge and bad faith in the seizure of property.”

Indiana Michigan Power is doing a lot of work to upgrade its Central South Bend Transmission System.

The project includes the installation of a new two-mile underground transmission line connecting the Colfax and Muessel substations.

That transmission line would cut across three parcels of private property owned by developer Dave Matthews and 701 Niles LLC.

Matthews did not object to the project until he learned a third party was involved.

“The M.O.U. (memorandum of understanding) is uh, it revealed that there was this arrangement in place, or attempted to be put in place, to allow the piggybacking,” said Shawn Ryan, an attorney representing Matthews and 701 Niles LLC.

Late in the process it was disclosed that Notre Dame was looking for a way to get power from a hydro-electric generating station it is building at Seitz Park, back to campus.

The plan called for the university to use the same underground duct bank Indiana Michigan Power was to build on land the utility seized through eminent domain.

Indiana Michigan Power argued that Notre Dame’s involvement was “incidental,” to the utility’s “paramount public use”—therefore allowed.

The Indiana Court of Appeals sent a strong message otherwise.

“There is a distinct division between public use and private use, and it will completely bar the use of eminent domain for private taking, or for private use,” said Ryan.

It appears that the ruling will not have much practical application. A written statement provided by the University of Notre Dame reads, “Because of the ongoing litigation and in order to meet our project schedule, the university worked with the city to find a route other than through the property in question. That was accomplished and we are pleased that a significant sustainability project that is a win-win for the community and university is near completion.”

AEP Indiana Michigan Transmission Company issued the following written statement:

“AEP Indiana Michigan Transmission Company appropriately exercised its statutory powers of eminent domain to secure easement rights to construct an underground transmission line that will aid in its objectives to provide reliable service to the South Bend area. The Indiana Court of Appeals recently ruled that AEP Indiana Michigan Transmission Company may not permit University of Notre Dame to use, as a part of Notre Dame’s planned hydro-electric facility, the easement rights appropriately secured by AEP Indiana Michigan Transmission Company. While AEP Indiana Michigan Transmission Company carefully considers the Court of Appeal’s ruling to determine its next step, the underground transmission line will move forward to completion without Notre Dame’s utilization and be put to use by AEP for the benefit of the South Bend area. Construction on the project has been substantially completed since early May and the remaining work relating to installation of conductors is expected to be completed by this fall.”

While Dave Matthews originally had no objection to the utility work taking place on his property, he did object to the amount of compensation being offered (around $75,000).

That disagreement lead to the use of condemnation.

In its ruling the court writes:

“AEP’s Line and the University’s private line constitute two separate, distinct sets of easements and that only the former may be obtained by condemnation.”

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