Arizona Supreme Court Holds That Claims for Compensation for Easements Across School Trust Lands Are Barred by the Statute of Limitations.

The Arizona-New Mexico Enabling Act of 1910 granted approximately ten million acres of land to the State of Arizona to be held in trust to support public schools.  From 1929 to 1967, the State Land Commissioner, who administers the trust, conveyed more than nine hundred easements to government entities for public use but received no consideration.  In 1967, the United States Supreme Court held that the Enabling Act requires the trust to be compensated for such easements.  Lassen v. Ariz. ex rel. Ariz. Highway Dep’t, 385U.S. 458, 469 & n.22 (1967).

On June 4, 2003, counsel for two school districts sent a letter to the State Land Commissioner regarding the nine hundred uncompensated easements.  After discussions failed to resolve the districts’ concerns, they filed suit on October 15, 2004.  Easement holders, who were joined as defendants, moved to dismiss the suit on various grounds.   

The parties to the action (and the Court) agreed that the suit was governed by a one-year statute of limitations.  See A.R.S. § 12-821.  The Court concluded that the districts’ claim accrued in 1967 when the United States Supreme Court’s decision in Lassen put beneficiaries of the land trust on constructive notice of claims regarding the easements.  The Court rejected the district’s argument that the State Land Commissioner has a continuing duty to remedy the violation of the Enabling Act.  Thus, the Court concluded, the districts’ claim was barred by the statute of limitations. 

Vice Chief Justice Berch authored the opinion. 

Justice Hurwitz concurred in part with Justice Berch’s opinion and concurred in the result.  He objected, however, to the Court’s conclusion that the districts’ claim accrued when theU.S. Supreme Court’s issued Lassen.  According to Justice Hurwitz, that reasoning was unnecessary to the Court’s holding because the districts were clearly on notice of their claim when their attorney sent a letter to the State Land Commissioner on June 4, 2003.  Because they filed suit more than one year later, their claim was barred by the statute of limitations.