A public transit agency sought a declaration that a gas utility was contractually responsible for the cost of relocating pipelines where they crossed a rail corridor.
The pipelines had been installed pursuant to historical crossing agreements between the utility’s predecessor and a railway company, which were assigned to the transit agency when it purchased the rail corridor.
The utility argued the agreements did not apply where the pipelines ran along municipal road allowances and further contended the payment obligations were tied to federal railway regulation that did not apply to the transit agency.
The court held the crossing agreements were valid contractual obligations assigned to the transit agency and enforceable regardless of the regulatory status of the parties.
The utility was ordered to reimburse the transit agency for relocation costs exceeding $2.3 million plus interest.
