Generally, with a few exceptions, a state owns tidelands, submerged lands, and lands lying below navigable lakes and rivers within its borders by reason of its sovereignty. Sovereign ownership by the states has two distinct elements. The first is the proprietary ownership of the land, which, under certain limited circumstances, may be sold by the state to others. The second is the interest held by the state in trust for the public, which, except for very limited circumstances may not be sold by the state. Sovereign ownership and the difficulties encountered in attempting to determine the character of the property which is the subject of a title order make wetlands an extra hazardous title risk.
The law in this area has primarily evolved from the English common law where those waters that were affected by tides and the abutting shores of those waters were deemed to be in the public domain and the King held title to those waters in trust for the benefit of the public. The concept of the land held by the sovereign for the benefit of the public goes back to the time of the Magna Charta. Royal ownership of these lands became the law of the colonies. After the revolution, the original states succeeded to the interests of the crown in the tidelands and large flowing waters. New states entering the union enjoyed the same rights of sovereignty and ownership under the equal footing doctrine. The leading case on this point is Illinois Central R.R. v. Illinois, 146 U.S. 387 (1892) where the court held that the state’s ownership of the Lake Michigan shore in Chicago was impressed with a trust for the benefit of the public. Put simply, generally, a state owns tidelands, submerged lands, and lands lying below navigable lakes and rivers within its borders by reason of its sovereignty.
While this public interest is referred to in various ways in different jurisdictions, it will be referred to here as “the public trust.” This public trust encompasses the public’s right to use tidelands and other navigable waters for commerce, navigation, and fishing.
In a more recent case, Phillips Petroleum Co. v. Mississippi, 108 S. Ct. 791 (1988), the Supreme Court reaffirmed that the state was vested with title to all lands under all waters affected by tide, whether navigable or not. The recent trend has been to expand the effect of the public trust by designating such activities as recreational use and even the preservation of tidelands in their natural state as a valid exercise of the public trust power. The public trust continues to exist even if the property is conveyed by the state into private ownership. These public rights may, as a practical matter, render the property worthless to its private owner.