Shri Lambodara, Inc. v. Parco, Ltd. ( 2023 )

IN THE COURT OF APPEALS OF IOWA
No. 22-0993
Filed May 10, 2023
SHRI LAMBODARA, INC.,
Plaintiff-Appellee,
vs.
PARCO, LTD.,
Defendant-Appellant.
________________________________________________________________
Appeal from the Iowa District Court for Black Hawk County,
Melissa Anderson-Seeber, Judge.
Parco, Ltd. appeals from the district court’s grant of summary judgment to
Shri Lambodara, Inc. AFFIRMED.
Peter D. Arling and Alyssa M. Carlson of O’Connor & Thomas, P.C.,
Dubuque, for appellant.
Jordan M. Talsma of Beecher, Field, Walker, Morris, Hoffman & Johnson,
P.C., Waterloo, for appellee.
Heard by Greer, P.J., and Chicchelly and Buller, JJ.
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BULLER, Judge.
This case arises from a dispute between two adjoining landowners over
whether a covenant granting pedestrian and vehicular access between their lots
had expired. After Parco, Ltd. blocked access between its lot and a lot owned by
Shri Lambodara, Inc. (Lambodara), Lambodara petitioned for declaratory
judgment. In resistance, Parco argued the covenant was an expired negative
easement or use restriction and counterclaimed for trespass and an injunction.
The district court granted summary judgment to Lambodara, finding the covenant
had not expired because it was an easement and not a use restriction. The district
court also dismissed Parco’s counterclaims. We affirm based on a straightforward
application of the 2014 statutory amendments to Iowa Code section 614.24(5)(a)
(2020), supported by the covenant’s plain language and the structure of the
document.
I. Background Facts and Proceedings
Lambodara and Parco own adjoining businesses in Black Hawk County.
The land is divided into three lots, as shown on the aerial map admitted at trial,
which we have included on the following page. Lot 1 occupies the bottom portion
of the map, Lot 2 occupies the upper left portion, and Lot 3 is in upper right. We
have added the bold black labels for “Lot 1 (Parco)” and “Lot 3 (Lambodara)” for
clarity, as the underlying labels are visible but not easy to read in the scanned copy
of the exhibit in our record.
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A 1984 deed of dedication with eight covenants governs all businesses on
the lots. The first three paragraphs of the deed (A through C) regulate use of the
land in ways immaterial to this appeal, and the fourth paragraph (D) establishes a
twenty-one-year expiration for the three preceding paragraphs. Paragraph G, the
language in contention, provides:
For the mutual benefit of the undersigned, its successors and
assigns in the ownership of the lot in said subdivision, the
undersigned covenants that no barriers will ever be erected to
prevent free and unlimited access for the owners and tenants and
invitees on the lots in said subdivision between the driveways and
parking areas on the lots in said subdivision, and this provision shall
be a covenant running with the land as though incorporated in each
and every deed and mortgage for all the lots in said subdivision
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hereafter, and may be enforced by the owners or tenants of any lot
in said subdivision.
Parco has owned a restaurant on Lot 1 since shortly after execution of the
1984 deed, and Lambodara has owned a hotel on Lot 3 since December 2009. At
the start of the relationship between Lambodara and Parco, the parties got along,
and patrons of the businesses had free access between the parking areas of all
three lots. Tensions flared in 2015 when Parco started to build a curb on its
property, blocking vehicle access between Lots 1 and 3. Lambodara’s attorney
demanded Parco stop building the curb and alleged Parco was violating
paragraph G. After receiving the letter, Parco ceased construction and removed
what it had built.
In 2017, Parco spent $51,724.21 to repair a damaged patch of concrete
near the boundary of Lots 1 and 3. Parco later accused Lambodara of causing the
damage, but between 2017 and 2021, Parco did not accuse Lambodara of
damaging the concrete, nor did Parco request that Lambodara’s customers refrain
from driving near the area.
Relations between the neighbors deteriorated after December 2020 when
Parco directed snow to be piled near the boundary between Lots 1 and 3,
obstructing access between the lots. Lambodara’s attorney demanded Parco
remove the snow according to the paragraph G easement. Parco’s attorney
responded and claimed that paragraph G was a negative easement that had
expired. Parco also asserted that while Parco previously “allowed [Lambodara’s]
customers’ recent use of its property outside the Easement, that use creates a
potential danger to Parco’s customers as they access the [restaurant] operated by
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Parco and, furthermore, has created significant damage to the paved surface on
Parco’s property.” In April 2021, Parco erected concrete barriers in the area where
the snow had been, which led to litigation.
Lambodara petitioned for declaratory judgment, requesting the district court
construe paragraph G as an easement requiring Parco to keep free and open
access between the lots. Lambodara also requested a permanent injunction
against Parco impeding access between Lots 1 and 3. Parco counterclaimed for
trespass and for an injunction against Lambodara. Both parties sought full or
partial summary judgment. The court reserved ruling on summary judgment and
heard evidence in a bench trial. After trial, the court granted Lambodara’s motion
for summary judgment, found that the language of paragraph G created an
easement rather than a use restriction, and denied Parco’s counterclaims. Parco
appeals.
II. Standard of Review
We review a summary judgment ruling for corrections of errors at law. See
Susie v. Family Health Care of Siouxland, P.L.C., 942 N.W.2d 333, 336 (Iowa
2020). Summary judgment is appropriate when no disputed issue of material fact
exists and the moving party is entitled to judgment as a matter of law. See id.III. Discussion
The parties on appeal largely cast the debate as concerning whether
paragraph G is an “affirmative easement” or a “negative easement” under Iowa’s
historical case law. We, like the district court found and a commentator suggests,
believe this language is outdated in light of the 2014 amendments to Iowa Code
section 614.25. The analysis required by that section turns on whether a covenant
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is an easement or a “use restriction.” See David M. Erickson & Christopher Talcott,
Iowa Practice Series: Real Estate Law and Practice § 1:12 (Nov. 2022 update)
(noting that the definition of “use restrictions” under the 2014 amendment “is
generally consistent with the Iowa Supreme Court’s prior case law—indeed, the
amendment could be seen as simply clarifying the original intent of the drafters of
the Stale Uses and Reversions Act”).
The 2014 amendments to chapter 614 defined “use restrictions” to exclude
“easement[s] for pedestrian or vehicular access.” See 2014 Iowa Acts ch. 1067,
§ 1 (codified at Iowa Code § 614.24(5)(a)). Paragraph G is such an easement: it
requires “free and unlimited access for [Lambodara’s] owners and tenants and
invitees . . . between the driveways and parking areas on [Parco’s] lot[].” Because
the General Assembly expressly carved out pedestrian- and vehicular-access
easements from “use restrictions,” the twenty-one-year expiration does not apply,
and we affirm the district court. The analysis could end here. But, given the
parties’ briefing, we go further.
Even if were to use the outdated terminology of “affirmative easement” and
“negative easement,” we would come to the same conclusion. Paragraph G grants
one party (Lambodara and its tenants and invitees) use of another’s land (Parco’s
lot), which is the textbook historical definition of an affirmative easement. See
Amana Soc’y v. Colony Inn, Inc., 315 N.W.2d 101, 110 (Iowa 1982); see also
Restatement (First) of Property §§ 451–52 (Am. Law Inst. Mar. 2023 update).
Even the more restrictive language of paragraph G, which expressly forbids
barriers, is consistent with an affirmative easement. See Restatement (Third) of
Property: Servitudes § 1.2(1) (Am. Law Inst. Mar. 2023 update) (recognizing an
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easement that creates “a nonpossessory right to enter and use land in the
possession of another . . . obligates the possessor not to interfere with the uses
authorized by the easement”). Paragraph G, under the historical case law, would
be an affirmative easement.
While we think this case is resolved on the plain language of the covenant
and application of the statutory text, we also find the structure of the document
supports the district court’s ruling. Paragraph D explicitly provides that paragraphs
A through C only endure “for a period of twenty-one years,” and no such limitation
applies to paragraph G. The covenant’s drafters knew how to impose the twenty-
one-year limitation for use restrictions, and we presume they acted deliberately
when they did not include such a provision for paragraph G. Cf. Farmers Coop.
Co. v. DeCoster, 528 N.W.2d 536, 539 (Iowa 1995) (“[W]here a statute with respect
to one subject contains a given provision, the omission of such provision from a
similar statute is significant to show a different intention existed.”). Also, rather
than being grouped with the use restrictions in A through C, the covenant drafters
placed paragraph G following easements in paragraphs E and F. Various canons,
as well as common sense, tell us that the grouping and sequence of provisions
can help us understand intent. Cf. Antonin Scalia & Bryan A. Garner, Reading
Law: The Interpretation of Legal Texts 152, 196–97, 214 (2012) (explaining the
nearest-reasonable-referent, associated-words, and distributive-phrasing canons
of construction, all of which support the notion that the sequencing and placement
of terms is useful in understanding text). To the extent either party argues
paragraph G is ambiguous, we find the covenant operates as an easement rather
than a use restriction.
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In support of its claim otherwise, Parco cites an unpublished decision of our
court and an out-of-state decision. We think both cases are distinguishable. In
Franklin v. Johnston, the covenant at issue acted only to restrict access into a
specific area, rather than facilitating “free and unlimited access” of a property. See
No. 15-2047, 2017 WL 1086205, at *4 (Iowa Ct. App. Mar. 22, 2017). The Franklin
covenant also explicitly expired after a twenty-one-year period, while paragraph G
here has no expiration date. Id. The Georgia case relied on by Parco, Davista
Holdings, LLC v. Capital Plaza, Inc., also involved language that only acted to
restrict the rights of a landowner, rather than creating an affirmative right to use of
a property. See 741 S.E.2d 266, 270 (Ga. Ct. App. 2013). The terms of the
covenant in that case also explicitly expired after twenty years, further
distinguishing it from paragraph G. See id. at 268.
Last, concerning counterclaims, Parco’s opening brief offers a sole
paragraph on this issue, with no citation to legal authority. We conclude Parco
waived its claim, as saving development of an argument for the reply brief is
improper and deprives the appellee of any opportunity to respond on the merits.
See Iowa R. App. P. 6.903(2)(g)(3); Villa Magana v. State, 908 N.W.2d 255, 260
(Iowa 2018); Goodenow v. City Council, 574 N.W.2d 18, 27 (Iowa 1998). But even
if this claim had been raised in the opening brief, we would affirm. In finding
paragraph G was an easement rather than a use restriction, the district court
necessarily disposed of Parco’s counterclaims, as any alleged trespass or request
for injunction was meritless as a matter of law. See Restatement (First) of Property
§ 451.
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IV. Disposition
We hold paragraph G is an easement not subject to the twenty-one-year
expiration period, rather than a use restriction, and we affirm the district court.
AFFIRMED.