Lyman v. Plymouth Empire Properties CA3 ( 2013 )

Filed 12/2/13 Lyman v. Plymouth Empire Properties CA3
NOT TO BE PUBLISHED
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
THIRD APPELLATE DISTRICT
(Amador)
----
JOSH LYMAN et al., C070973
Plaintiffs, Cross-defendants and (Super. Ct. No. 08CV5212)
Appellants,
v.
PLYMOUTH EMPIRE PROPERTIES, INC.,
Defendant, Cross-complainant and
Respondent;
IONE BAND OF MIWOK INDIANS,
Defendant and Respondent.
This case stands for the simple proposition that it is not an abuse of discretion to
deny an equitable easement to landowners who purchased landlocked property knowing
they did not have legal access to the land and who had been told they needed to secure an
easement before purchasing the property. We reject plaintiffs Josh and Julie Lyman’s
distortion of the standard of review as well as their misreading of the leading authority on
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equitable easements and affirm the judgment, rejecting their attempt to quiet title to an
easement over property owned by defendants Plymouth Empire Properties, Inc. (PEP),
and the Ione Band of Miwok Indians (the Tribe). However, we must reverse the
judgment insofar as it awards $100 in damages to PEP for trespass because we conclude
there is insufficient evidence to support the finding.
FACTS
At the heart of this controversy is the so-called “County Road 81,” which is not a
county road at all. For some period of time many years ago the road was designated
“County,” but Amador County never improved or maintained the road, and eventually the
fact the public held no rights in the road was clarified in a reverse quiet title action. The
judgment held that “County Road 81” never was a county road. Nevertheless, “County
Road 81,” which is little more than a dirt track, traverses property owned by defendants
PEP and the Tribe, and provides ingress and egress to several property owners, including
plaintiff Josh Lyman’s brother, Jared Lyman. In 2004 PEP installed several permissive
use signs along the road. There is also a sign stating “Private Road.”
Indeed, Jared purchased his land before plaintiffs purchased theirs and negotiated
the purchase of an access easement from defendant PEP. Other neighbors, the Allisons,
have been granted permission to access their property. Before plaintiffs purchased their
property, Carol Emerson, a vice-president at PEP, told plaintiff Josh Lyman that he
needed to secure an easement for ingress and egress. The title reports confirmed that
there was no recorded access to the parcels. Plaintiff Josh Lyman acknowledged that at
the time of purchase he was aware there was no legal access to the property. He knew it
was not a public road. He assumed he had a right to use a county road and he assumed,
despite advice to the contrary, that he did not need to secure any access rights.
After purchasing the property, plaintiffs traveled over defendants’ property on
County Road 81 to access their property. They have not spoken to other neighbors about
alternative access to their property, including the adjoining land to the east known as
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Montevina Vineyards. Historically, people have also used a road across the Montevina
vineyards for access to plaintiffs’ land and other property in the area.
PEP has plans to develop its property, and the location of the road would impair its
ability to either sell the property or fully develop it. The grant of the easement would
also encumber the Tribe’s ability to build housing or pursue solar or broadband
development, which might require moving the road.
The trial court’s findings are blunt. “The conclusion is inescapable that Plaintiffs
simply ‘rolled the dice’, and it is astonishing that anyone would consummate a purchase
under such circumstances as shown by the evidence here. Having been told by
Ms[.] Emerson there was no access to the parcels Plaintiffs proposed to purchase, without
any investigation with Amador County officials and records or requirement that the
buyers ensure the parcels had access and going forward on the chance their assumption
was correct, Plaintiffs cannot be said to be ‘innocent’ in respects of the present
controversy. Plaintiffs’ actions are fairly characterized as willful, or at very least, as
grossly negligent, and through their conduct alone, have caused the controversy by
encroaching on the property of their neighbors.”
The court expressly considered the hardship to defendants if an easement were
imposed. “The road in issue crosses a sensitive portion of the land of the Defendants.
Evidence established, as did the courts’ view of the site, that the only propitious portion
of the Tribe’s parcel for most development, the level portion, is the area traversed by the
road, as immediately south of the road the land drops off steeply and is cut by ravines.
The testimony of the Tribe’s administrator made clear the fact that without the flexibility
to deal with a user of the road as they have with the Jared Lyman and Allison families,
the development potential of their parcels is constrained. Similarly, the value of PEP and
Tribe land would be compromised by the existence of an easement over which they have
no effective ability to impose limits on use or effect its relocation to accommodate their
development interests. The attractiveness of PEP land to the Tribe or any other potential
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purchaser would be adversely affected by imposition of an easement for use by
Plaintiffs.” The grant of an equitable easement was denied.
As to PEP’s cross-complaint for trespass, the court entered judgment in favor of
PEP and granted damages of $100. The trespass cause of action was based on the
construction of a “$20 fence” on PEP’s property. Plaintiff Josh Lyman testified he did
not construct the fence, nor did he instruct others to do so. No one testified who actually
constructed the fence. One of PEP’s representatives testified that he saw plaintiffs’
livestock grazing on PEP property.
As to the $20 fence, the trial court found that “not until Plaintiffs bought and
began fencing their property was there an issue of where cattle would roam in the area,
and given that they had an obvious interest in containing their cattle and excluding others,
the greater likelihood is that they caused the disputed fence to be erected.” The court also
explained, “[T]estimony by Mr. Monaghan established that cattle bearing Plaintiffs’
brand were grazing within the strip of PEP land between Plaintiffs’ and the
Vineyard/push gate and contained by the ‘$20 fence’. The weight of the evidence is that
Plaintiffs’ caused the fence to be placed between the fence post corner on their property
and fencing on the PEP-Montevina property line. Cost of removal of the several posts
and strung wire is nominal, certainly not more than $100, and such sum is awarded to
PEP which may itself cause its removal. No evidence was presented nor were damages
sought for loss of use of the portion of PEP property south of the fence from the time it
appeared.”
The case was tried on theories of easement by prescription, implication/necessity,
and equity/balance of the hardships. Pursuant to section 631.8 of the Code of Civil
Procedure, the court granted defense motions as to the theories of prescription and
implication. On appeal, plaintiffs do not challenge those rulings. At issue is the denial of
a grant of an equitable easement and trespass.
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DISCUSSION
I
Standard of Review
“In appropriate cases in which the requirements for traditional easements are not
present, California courts have exercised their equity powers to fashion protective
interests in land belonging to another, sometimes referring to such an interest as an
‘equitable easement.’ ” (Tashakori v. Lakis (2011) 196 Cal. App. 4th 1003, 1008
(Tashakori).) Plaintiffs’ first obstacle is the deferential and limited scope of appellate
review. “When reviewing a trial court’s exercise of its equity powers to fashion an
equitable easement, we will overturn the decision only if we find that the court abused its
discretion.” (Ibid.)
Plaintiffs insist, however, that we must independently review the trial court’s
ruling because “the legal inquiry requires an evaluation of whether the legal principles of
negligent and willful conduct were incorrectly interpreted and applied by the Trial Court
to the doctrine of relative hardship, and to the legal concept of ‘innocent
encroachment’. ” Plaintiffs’ reliance on Crocker National Bank v. City and County of
San Francisco (1989) 49 Cal. 3d 881, 888 (Crocker) is misplaced.
First, Crocker is a tax case and does not involve an equitable easement. It does
involve the classification of an item of personal property as a fixture for purposes of
taxation. The Supreme Court explained that “[t]axation must, of course, be uniform and
the tax laws uniformly applied. [Citation.] Uniformity depends on proper classification.
And proper classification is furthered through the application of independent review.”
(Crocker, supra, 49 Cal.3d at pp. 888-889.) Thus, “the pertinent inquiry bears on the
various policy considerations implicated in the solution of the problem of taxability, and
therefore requires a critical consideration, in a factual context, of legal principles and
their underlying values.” (Id. at p. 888.)
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Second, the taxability question “reduces itself to whether a reasonable person
would consider the item to be a permanent part of the property . . . .” (Crocker, supra,
49 Cal.3d at pp. 887-888.) An appellate court is as well equipped as the trial court to
apply the reasonable person standard in deciding classification issues that would support
a uniform tax policy. (Ibid.)
By contrast, the questions to be resolved by a trial court in deciding whether to
grant an equitable easement are unique to the factual context and unrelated to any policy
of uniformity. Simply put, the question is not predominantly legal. Rather, the court
must resolve what individual landowners believed and what they did—inherently factual
questions. Crocker is inapposite.
Indeed, in cases involving equitable easements the chorus is harmonious. Because
the trial court exercised its equity powers when fashioning an easement, “we review the
judgment under the abuse of discretion standard.” (Hirshfield v. Schwartz (2001)
91 Cal. App. 4th 749, 771 (Hirshfield).) “The question whether the defendant’s conduct is
so egregious as to be willful or whether the quantum of the defendant’s negligence is so
great as to justify an injunction is a matter best left to the sound discretion of the trial
court.” (Linthicum v. Butterfield (2009) 175 Cal. App. 4th 259, 267 (Linthicum); accord,
Zanelli v. McGrath (2008) 166 Cal. App. 4th 615, 638.) We turn, therefore, to a review of
the record to determine whether the trial court abused its discretion in deciding that
plaintiffs’ conduct was “fairly characterized as willful, or at the very least, as grossly
negligent” and that they “effectively sought to ‘extort’ their neighbors.” We can find no
abuse of discretion in the court’s conclusion that “it would be a manifest injustice, akin to
extortion” to burden defendants with an easement.
II
Equitable Easement
Plaintiffs’ appeal is premised on a misunderstanding of what they characterize as
the “common law” regarding equitable easements. They insist that negligence is
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equivalent to the type of innocent encroachment that justified equitable easements in
Linthicum and Tashakori. While both cases offer a helpful template in reviewing a trial
court’s exercise of discretion in granting an equitable easement, neither case is factually
analogous to the case before us. They do, however, deserve close examination.
In Linthicum, the plaintiffs’ neighbors had used a roadway over the plaintiffs’ land
for many years, believing they had an easement from the United States Forest Service.
(Linthicum, supra, 175 Cal.App.4th at pp. 263-264.) The plaintiffs bought the parcel and
sought to enjoin the neighbors’ use of a road that provided the sole access to their
properties. (Id. at p. 262.) No alternative access could be constructed. (Id. at p. 265.) In
exercising its discretion to deny the plaintiffs’ request for injunctive relief, the court
considered the following factors: “ ‘1. Defendant must be innocent—the encroachment
must not be the result of defendant’s willful act, and perhaps not the result of defendant’s
negligence. In this same connection the court should weigh plaintiff’s conduct to
ascertain if he is in any way responsible for the situation. 2. If plaintiff will suffer
irreparable injury by the encroachment, the injunction should be granted regardless of the
injury to defendant, except, perhaps, where the rights of the public will be adversely
affected. 3. The hardship to defendant by the granting of the injunction must be greatly
disproportionate to the hardship caused plaintiff by the continuance of the encroachment
and this fact must clearly appear in the evidence and must be proved by the defendant.
But where these factors exist, the injunction should be denied, otherwise, the court would
lend itself to what practically amounts to extortion.’ [Citation.]” (Id. at p. 265.)
The trial court found that the plaintiffs purchased the parcel with full knowledge
of the historical use of the roadway and nevertheless sought to deprive their neighbors of
the value and use of their properties. (Linthicum, supra, 175 Cal.App.4th at p. 266.) The
court also found that the roadway did not substantially interfere with the plaintiffs’ right
to use and develop their property, yet the neighbors would suffer a catastrophic loss if
denied access to their properties. (Ibid.) The Court of Appeal affirmed the trial court’s
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denial of the request for an injunction, finding that the court “acted well within its
discretion in denying the injunction.” (Id. at p. 267.)
The equities were just as apparent and imbalanced in Tashakori. In Tashakori, as
in the instant case, the trial court was asked to exercise its inherent equitable power to
fashion an equitable easement rather than to enjoin an encroachment as in Linthicum.
“[T]he courts are not limited to judicial passivity as in merely refusing to enjoin an
encroachment. Instead, in a proper case, the courts may exercise their equity powers to
affirmatively fashion an interest in the owner’s land which will protect the encroacher’s
use.” (Hirshfield, supra, 91 Cal.App.4th at p. 765.)
In Tashakori, as in Linthicum, one of the parties was innocent. The Tashakoris
bought a parcel “with the innocent belief that an easement to the public road existed.”
(Tashakori, supra, 196 Cal.App.4th at p. 1010.) They later subdivided the parcel into
two, but both parcels shared a common driveway. They sold one of the parcels, which,
unbeknownst to them, left their remaining lot landlocked. (Id. at p. 1005.)
The trial court found that the owners of the other parcel would “suffer virtually no
harm at all from the Tashakoris’ use of the shared driveway to access Lot 18, and that the
Tashakoris would be irreparably harmed if their sole means of accessing their property
were denied.” (Tashakori, supra, 196 Cal.App.4th at p. 1010.) The court granted an
equitable easement over the common driveway, and the Court of Appeal affirmed. (Id. at
pp. 1005-1006.)
Plaintiffs’ spin on cases favorable to defendants is disingenuous. They insist that
their predicament is at least as innocent as the neighbors in Linthicum, who years earlier
had been asked by the Forest Service to renew their special unit permits but failed to do
so. Those neighbors, plaintiffs argue, assumed like they did that either the roadway was
public or that they had an easement to use it, but they did not verify the legal status of the
land before they purchased it. Nevertheless, the court characterized their encroachment
as innocent. Plaintiffs complain that the trial court did not apply the same rationale to
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their situation, an equally innocent encroachment based on their mistaken belief that
County Road 81 was a public road and/or they had the right to use it because otherwise
their property was landlocked.
But plaintiffs simply dismiss all the facts that distinguish their willful or grossly
negligent conduct from the innocent encroachment the court found in Linthicum. Before
plaintiffs purchased the property, Carol Emerson, a shareholder and board member of
defendant PEP, personally told plaintiff Josh Lyman that he needed an easement for
ingress and egress to access the property. The title reports confirmed the same fact—
“[t]he lack of a right of access recorded in insurable form to and from said land to a
public street” and the “[l]ack of right of recorded access to and from said premises.”
From their conversations and the title reports, therefore, plaintiffs were aware and
understood before buying the property that there was no recorded legal access to it.
Based on this evidence, the court determined that plaintiffs had merely “ ‘rolled
the dice,’ ” and purchasing the property with the knowledge they had no legal access was
“astonishing.” In the court’s view, their “actions are fairly characterized as willful, or at
very least, as grossly negligent, and through their conduct alone, have caused the
controversy by encroaching on the property of their neighbors.” There is ample evidence
to support the trial court’s finding, and we can find no abuse of discretion in refusing to
grant an easement in equity when the purchasers bought a parcel they knew was
landlocked and made no attempt to negotiate an easement before consummating the sale.
Plaintiffs’ conduct was more akin to the property owner in Linthicum who,
knowing his neighbors had used a roadway over the parcel he planned to purchase,
bought it anyway and then attempted to enjoin his neighbors’ use. The trial court had
little difficulty in assessing the relative equities. The neighbors had used the roadway for
many years before discovering any potential problem, a problem they believed was
resolved when the Forest Service did not provide them the promised permit. (Linthicum,
supra, 175 Cal.App.4th at p. 264.) Unlike plaintiffs, they had no notice prior to
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purchasing their property that they did not have the legal right to use the roadway.
Plaintiffs, like their counterparts in Linthicum, bought their property with knowledge of
the facts and gambled anyway. In both cases the trial courts, sitting in equity, did not
abuse their discretion by aborting the plaintiffs’ attempts to take advantage of their
neighbors.
Nor can plaintiffs compare their nonchalant approach to proceeding with the
purchase of property they knew lacked legal access with the diligent investigation
undertaken by the landowners in Tashakori. The trial court found they “reasonably relied
on inaccurate representations by the real estate broker and the prior owner, and the legal
description contained in the preliminary title report” and believed that there was a
recorded easement that allowed access. (Tashakori, supra, 196 Cal.App.4th at p. 1007.)
Plaintiffs, on the other hand, willfully ignored the information they received from the title
reports and from defendant PEP, and ask us to save them from their recklessness at
defendants’ expense. This we cannot do.
Moreover, plaintiffs have a misguided notion that their conduct was somehow
irrelevant because others had used County Road 81 as a public road long before they ever
purchased the property. In other words, even if their conduct was willful or negligent,
they could rely on the innocent conduct of others who “created” the encroachment.
There is no authority for their argument; indeed, it is at odds with the principles reiterated
in the cases they cite regarding equitable easements.
In these cases the courts balance the equities between the persons encroaching on
another’s land and the landowners. “The ‘relative hardship’ test helps courts assess
whether to deny injunctive relief to a property owner and instead grant an equitable
easement to the encroaching user. To create an equitable easement, ‘three factors must
be present. First, the defendant must be innocent. That is, his or her encroachment must
not be willful or negligent. The court should consider the parties’ conduct to determine
who is responsible for the dispute. Second, unless the rights of the public would be
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harmed, the court should grant the injunction if the plaintiff “will suffer irreparable
injury . . . regardless of the injury to defendant.” Third, the hardship to the defendant
from granting the injunction “ ‘ “must be greatly disproportionate to the hardship caused
plaintiff by the continuance of the encroachment and this fact must clearly appear in the
evidence and must be proved by the defendant. . . .” [Citation.]’ [Citation.]” (Tashakori,
supra, 196 Cal.App.4th at p. 1009.)
As noted above, plaintiffs cannot surmount the first hurdle—their conduct was not
innocent. The trial court’s findings, supported as they are by substantial evidence, were
sufficient to deny the equitable easement. But the trial court addressed the second and
third factors as well, concluding that the easement would unfairly limit the development
potential for both defendants. Plaintiffs complain that whatever limitation on
development potential defendants might conceivably suffer pales in comparison to the
irreparable injury they will suffer when their property becomes landlocked.
We need not weigh in on this controversy. The trial court noted that plaintiffs had
failed to explore any alternative easements over other neighbors’ property. Whether or
not they did or should have does not change the pivotal finding that the dispute was of
plaintiffs’ own doing. We note that doubtful cases should be decided in favor of the
landowner and not the encroacher. (Linthicum, supra, 175 Cal.App.4th at p. 266.) Here
there is not even room for doubt. Plaintiffs knew what they were buying, knew they did
not have legal access to the property, bought it anyway, and then attempted, as the trial
court found, to extort their neighbors. On this record, we cannot say the trial court
abused its discretion in denying them an equitable easement.
III
Trespass
Defendant PEP cross-complained for trespass based on the appearance of a
$20 fence on its property. Plaintiffs appeal the $100 damage award to cover the cost of
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removing the fence. They contend there is no substantial evidence to support a finding
that they constructed or instructed anyone else to construct the fence. We must agree.
Plaintiff Josh Lyman testified he did not install the fence, nor did he have anyone
install it on his behalf. Defendant PEP presented no evidence as to who constructed the
fence or when it was done. The court’s finding was based solely on the inference it drew
that plaintiffs benefited from the existence of the fence. But since there was no evidence
to substantiate when the fence appeared, it is pure speculation that plaintiffs alone
benefited from it. In fact, plaintiff Josh Lyman testified that there was a tenant on this
section of PEP’s land who was running cattle and was concerned that those cattle would
get off his property. According to plaintiffs, the fence benefited the tenant because it
restrained the cattle grazing on the PEP property from entering onto other parcels.
We agree with plaintiffs that a “ ‘mere scintilla of evidence need not be affirmed
on review.’ [Citation.]” (Kuhn v. Department of General Services (1994)
22 Cal. App. 4th 1627, 1633.) “While substantial evidence may consist of inferences, such
inferences must be ‘a product of logic and reason’ and ‘must rest on the evidence’
[citation] . . . .” (Ibid.) Inferences that are the result of mere speculation or conjecture
cannot support a finding. (Ibid.) The trial court’s finding rests not on the evidence, but
on mere speculation and conjecture.
DISPOSITION
The judgment is reversed insofar as it awards damages to PEP of $100 for
trespass; in all other respects, the judgment is affirmed. Respondents shall recover costs
on appeal.
RAYE , P. J.
We concur:
ROBIE , J.
HOCH , J.
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