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Nature Conservancy v. Browder

February 5, 2008

THE NATURE CONSERVANCY
v.
DON BROWDER, ET AL.



The opinion of the court was delivered by: J. Ronnie Greer United States District Judge

MEMORANDUM OPINION AND ORDER

On May 30, 2007, the Plaintiff, The Nature Conservancy ("TNC"), filed a complaint, [Doc. 1],in this Court against the Shady Valley Watershed District ("District"), Unformed Watershed District ("Unformed District"), Don Browder, Vance Gentry, Earl B. Howard, Jr., Gerald Buckles, Wayne Duncan, Garry Dunn, Earl B. Howard, Sr., and Randy McQueen, seeking first a declaratory judgment that District has been dissolved by operation of law, that TNC's property in Johnson County, Tennessee, is free from any and all easements held by the Defendants, and that the Unformed District does not hold any property rights once held by the dissolved District. Second, TNC seeks to quiet the title to its property and for the Johnson County Register of Deeds to reform all deeds and remove any and all easements once held by the District. Third, the Plaintiff alleges that the Defendants violated the Tennessee Consumer Protection Act ("TCPA"), see T.C.A. § 47-18-104(27) (2008), and fourth, the Plaintiff asserts a negligence per se claim against the individual Defendants. The basis for subject matter jurisdiction is diversity, see 28 U.S.C. § 1332(a) (2008).

On June 7, 2007, the parties agreed to a preliminary injunction, [Doc. 27], enjoining the Defendants and their agents from coming onto TNC's land and from causing damage to TNC's property. Before filing an answer, the Defendants filed two motions to dismiss, [Docs. 32 and 34]. In the first motion, [Doc. 32], the subject of this opinion, the Defendants moved for dismissal pursuant to Fed. R. Civ. P. 12(b)(1), lack of subject matter jurisdiction, and (b)(6), failure to state a claim upon which relief can be granted, regarding all four claims.

The Defendants first argue that this Court lacks subject matter jurisdiction because:

1) the Plaintiff lacks standing to sue, contending that the declaratory judgment and quiet title actions can only be brought as quo warrantor claims; 2) "the Declaratory Judgment Act, 28 U.S.C. § 2201, does not create an independent basis for subject matter jurisdiction";*fn1 and 3) the amount in controversy is not met.*fn2 Secondly, the Defendants argue that the complaint should be dismissed because 1) the "Plaintiff cannot prove that the District is no longer in existence," and 2) the TCPA and negligence per se claims should be dismissed, "thereby destroying any basis for a damage claim exceeding the amount of $75,000."

I. FACTS

The complaint states that in September 1958, the directors of a proposed Shady Valley Watershed District filed organizing papers to form a watershed district under the Tennessee Watershed District Act of 1955, see T.C.A. § 69-6-101, et seq., and received its charter in 1960. The District issued a work plan for "improvements" to Beaverdam Creek and its tributaries. In June 1964, property owners along Beaverdam Creek and its tributaries granted the District easements to execute the work plan. The complaint further outlines the District's purpose according to statute. Its statutory powers include the power to:

construct any drainage works or improvements; to construct any works or improvements for the control, retention, diversion, or utilization of water; retard runoff of water and soil erosion; construct ditches, channel improvements, dikes, levees, flood prevention reservoirs, water conservation reservoirs, or irrigation reservoirs or facilities, parks, and other recreational facilities.

Each easement granted stated that the purpose of the easement was for or in connection with the construction, operation, maintenance and inspection of the following described works of improvement: Channel Improvement of Beaverdam Creek and its tributaries, as described in the Watershed Work Plan for the Shady Valley Watershed Project, consisting of clearing, enlargement, excavation, placing of waste excavation material, and installation of mitigation (fish and wildlife conservation) measures, either or all.

The complaint alleges that the District completed its work plan prior to 1980, and further alleges that because the District has failed to exercise its corporate powers for a period of ten years, it is dissolved by operation of law.

The complaint further states that TNC "has been actively involved with land conservation [in Johnson County, where the work plan was executed by the District] since 1978 and "actively acquiring land [in the same area] since 1994" for the purpose of preserving "existing bogs and to restore bogs that have been drained, which in turn provide habitat for rare and threatened species."*fn3 Moreover, the complaint alleges that TNC has established wetland mitigation banks at its bogs, and the banks allow TNC to "sell wetland mitigation credits." In addition, the complaint states that TNC received a letter dated March 12, 2007, from Defendant Gentry, writing for "The Shady Valley Watershed District board of directors," which requested TNC to immediately unblock all Shady Valley Watershed laterals located on Shady Valley Nature Conservancy properties.

The Shady Valley Watershed Board will inspect the laterals located on Shady Valley Nature Conservancy properties no later than May 12, 2007 to ensure that blockages to the laterals have been removed.

The complaint alleges four causes of action: 1) declaratory judgment that the District has been dissolved by operation of law, that the District's easements are, thus, extinguished, and that the Unformed District does not hold any property rights in the easements; 2) quiet title action declaring TNC's property free and clear of any clouds and for the Johnson County Register of Deeds to reform the deeds; 3) violation of the TCPA, stating that TNC is a "consumer of real property" and that the Defendants "engaged in acts and practices deceptive to Plaintiff"; and 4) that the individual Defendants committed criminal impersonation, "as defined by Tenn. Code Ann. § 39-16-30," thus, "giving rise to a finding of negligence per se, in this instance, tortious impersonation."

The complaint also states, "This action involves an amount in controversy exceeding $75,000.00, exclusive of interest and costs, and between citizens of different States. This Court's subject matter jurisdiction is proper pursuant to 28 U.S.C. § 1332(a). . . ." Elsewhere, it states that TNC paid $1.7 million for ten parcels of land, the subject of this litigation. Damages are mentioned only two other times in the complaint. Under the TCPA claim, the complaint states, "As a consequence of Defendants' deceptive acts and practices, Plaintiffs have been damaged by such fraud in an amount to be shown at trial," and under the negligence per se claim, it states, "Defendants' negligence per se has proximately caused Plaintiff harm for which Defendants are liable in an amount to be proven at trial."

II. AMOUNT IN CONTROVERSY

A. Standard of ...


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