Oberlander v. Hennequin ( 2023 )

03/14/2023
DA 22-0274
Case Number: DA 22-0274
IN THE SUPREME COURT OF THE STATE OF MONTANA
2023 MT 45RONALD R. OBERLANDER,
Third-Party Plaintiff, Third-Party Counter-defendant,
and Appellant,
v.
JACQUES HENNEQUIN, CARLIE HENNEQUIN,
KENT J. WATKISS, TAWANA RAE WATKISS, JEFFREY S.
MCDONALD, NATALIE M. MCDONALD, CHRISTOPHER
ROEMER, JOHN ZAUHER, KELLI GOLDSBURY, JOHN
GOLDSBURY, SUSAN DORAN CARTER, STEFANY J.
FRAY, PATRICK OFFEN, SAM STOVER, AUDREY J.
STOVER, KATHIE L. STANISLAW, WALTER W.
RICHARDS, III, SUSAN L. RICHARDS, JOHN D.
RANDALL, SUSAN K. RANDALL, LOUIS LEVINSON,
CAROLYN M. LEVINSON, VICTOR C. BIELBY AS
TRUSTEE OF THE VICTOR C. BIELBY TRUST,
JOHN S. STIEGLER, AND MELISSA STIEGLER,
Third-Party Defendants, Third-Party Counter-claimants,
and Appellees.
APPEAL FROM: District Court of the Twenty-First Judicial District,
In and For the County of Ravalli, Cause No. DV-21-317
Honorable Shane A.Vannatta, Presiding Judge
COUNSEL OF RECORD:
For Appellant:
Jeffrey R. Kuchel, Gregory G. Schultz, Crowley Fleck PLLP,
Missoula, Montana
For Appellees:
Joseph D. Houston, Kevin S. Jones, Jones & Associates, PLLC,
Missoula, Montana
Submitted on Briefs: January 25, 2023
Decided: March 14, 2023
Filed:
ir,-6m---if
__________________________________________
Clerk
2
Justice Beth Baker delivered the Opinion of the Court.
¶1 Ronald Oberlander appeals the Twenty-First Judicial District Court’s preliminary
injunction preventing Oberlander from accessing his leased State school trust land via
private roadways in the Hidden Valley Ranches subdivision. The District Court granted
the injunction after determining that Oberlander did not have standing to bring a
prescriptive easement claim because he was not the owner of the dominant tenement at
issue and had not otherwise asserted a legal right or claim to use the route.
¶2 The District Court mistakenly concluded that only an owner of land benefitted by
an easement may bring a prescriptive easement claim. As an occupant of the dominant
tenement, Oberlander has standing to bring a prescriptive easement claim pursuant to
§ 70-17-109, MCA. We accordingly reverse the District Court’s grant of a preliminary
injunction.
FACTUAL AND PROCEDURAL BACKGROUND
¶3 The Hidden Valley Ranches subdivision was created in 1977 by the recording of
Certificate of Survey No. 1316 in Ravalli County. To ensure that property owners could
access the individual tracts within Hidden Valley Ranches, Certificate of Survey No. 1316
created a “60’ Private Roadway and Utility Easement.” Pursuant to the Hidden Valley
Ranches Declaration of Covenants, the Hidden Valley Ranches Homeowners Association
(HOA) maintains the roads subject to this easement. All property owners within Hidden
Valley Ranches are members of the HOA, which is operated by a Board. The HOA pays
for maintenance of the private roads with assessments from its members.
3
¶4 In 2001, Ronald Oberlander acquired leases for State school trust land located in
Ravalli County. Oberlander’s leases cover 327.7 grazing acres and 352.3 agricultural
acres. At the same time he acquired these leases, Oberlander purchased an adjacent parcel
of land within Hidden Valley Ranches—Tract 25a. Prior to the preliminary injunction,
Oberlander accessed the leased land by traveling through his tract and over portions of two
private roads maintained by the HOA—Hidden Valley Road South and Fescue Slope Road.
¶5 In 2021, the HOA filed a complaint against Oberlander and applied for a preliminary
injunction, alleging that Oberlander used Hidden Valley Road South and Fescue Slope
Road to transport his farming equipment “without an easement or legal right to do so and
without contribution for the added burden upon and damage to the [HOA] roads.” In the
alternative, the HOA alleged that if an easement allowed for Oberlander’s use, his use now
exceeded the easement’s scope because he “increased usage and thereby caus[ed] damages
to the [HOA].” The HOA claimed Oberlander’s use constituted a trespass, violation of
applicable covenants, and unjust enrichment. The HOA requested that the District Court
enjoin Oberlander from using the private roads to access the leased State land for the
pendency of litigation.
¶6 Oberlander filed a counterclaim against the HOA and a third-party complaint
against individual property owners within Hidden Valley Ranches whose property he
entered to reach the State land. Oberlander’s counterclaim requested that the District Court
find Oberlander’s historic agricultural use of Tract 25a compliant with any applicable
covenants asserted by the HOA. In his third-party complaint, seeking declaratory
4
judgment, Oberlander claimed a prescriptive easement appurtenant to his State leasehold.
Oberlander filed a lis pendens regarding his alleged prescriptive easement.
¶7 Some of the individual property owners that Oberlander named in his third-party
complaint did not respond, and the District Court entered their defaults. The individual
property owners who did respond counterclaimed for trespass and moved the court to join
the State of Montana as an additional third-party plaintiff due to the State’s interest as the
owner of the land benefitted by Oberlander’s prescriptive easement claim.
¶8 In an April 2022 order, the District Court denied the property owners’ motion for
joinder. In the same order, it dismissed Oberlander’s claim for a prescriptive easement,
concluding that he lacked standing to bring such a claim. The District Court determined
that only the State could bring a prescriptive easement claim as owner of the land benefitted
by such an easement. The court noted an October 25, 2021 letter the State sent to counsel
for the HOA and property owners stating that it “d[id] not claim a prescriptive easement
for the use of Hidden Valley Road South or Fescue Slope Road.”
¶9 After the court dismissed Oberlander’s prescriptive easement claim, the property
owners who responded to Oberlander’s third-party complaint applied for a preliminary
injunction enjoining Oberlander from crossing over their properties with his farming
equipment to reach his State leasehold. The property owners argued that they were entitled
to injunctive relief because Oberlander’s easement claim had been dismissed; thus, they
were likely to prevail on the merits of their trespass claim.
5
¶10 The court convened a show-cause hearing for the requested injunction on May 6,
2022. At the hearing, Oberlander testified that he used the private roadways because he
could not feasibly transport his large farming equipment to the State land via public road.
Oberlander also testified to the “status quo” that would be upset by the grant of a
preliminary injunction, stating that, in addition to Oberlander’s two decades of use, the
previous leaseholder of the State land had used the same private roads to transport farming
equipment.
¶11 On May 16, 2022, the District Court entered its Findings of Fact, Conclusions of
Law and Order Granting Preliminary Injunction. The order enjoined Oberlander from
“entering upon Third-Party Defendants’ properties, including the Hidden Valley Ranches
private road easements, for the purpose of accessing the state land[.]” The court also
required Oberlander to release the lis pendens he filed on the property owners’ tracts.
¶12 The court reasoned that after Oberlander’s prescriptive easement claim had been
dismissed for lack of standing, there was “no evidence of an easement over Third-Party
Defendants’ properties in favor of the state land.” Oberlander therefore could not “identify
any legal claim or right to enter upon the Third-Party Defendants’ properties to access the
state land.”
STANDARD OF REVIEW
¶13 We review the grant of a preliminary injunction for manifest abuse of discretion.
Flora v. Clearman, 2016 MT 290, ¶ 13, 385 Mont. 341, 384 P.3d 448 (citation omitted).
When the grant of a preliminary injunction is based on a court’s conclusions of law, we
6
review the court’s conclusions for correctness. Caldwell v. Sabo, 2013 MT 240, ¶ 19, 371
Mont. 328, 308 P.3d 81 (citations omitted). The question of standing is a question of law
that we review de novo. JRN Holdings, LLC v. Dearborn Meadows Land Owners Ass’n,
2021 MT 204, ¶ 17, 405 Mont. 200, 493 P.3d 340 (citing Heffernan v. Missoula City
Council, 2011 MT 91, ¶ 28, 360 Mont. 207, 255 P.3d 80 (citations omitted)).
DISCUSSION
¶14 Oberlander argues that the District Court erred when it determined that he did not
have personal standing to bring a prescriptive easement claim. Oberlander maintains that
his leasehold in the State land—not the State land itself—is the dominant tenement of the
alleged easement, allowing him therefore to bring his prescriptive easement claim as owner
of the dominant tenement pursuant to § 70-17-109, MCA.
¶15 The property owners respond first that Oberlander’s appeal is not properly before
this Court because Oberlander appeals an interlocutory order, or, in the alternative, that
Oberlander failed to appeal the District Court’s dismissal of his prescriptive easement
claim within thirty days. If Oberlander’s appeal is subject to review, the property owners
argue, the District Court correctly dismissed Oberlander’s claim for lack of standing
because, as “a mere leaseholder,” Oberlander does not have standing to bring a prescriptive
easement claim.
¶16 “Standing is a threshold jurisdictional requirement.” Sagorin v. Sunrise Heating &
Cooling, LLC, 2022 MT 58, ¶ 8, 408 Mont. 119, 506 P.3d 1028 (citations omitted). The
property owners contend that Oberlander cannot argue the issue of standing for his
7
prescriptive easement claim in this appeal because the District Court’s order dismissing the
claim was “an adjudication of fewer [than] all claims,” leaving matters in the litigation
undetermined. The property owners maintain that the issue of standing would be
appealable only by certification of the District Court directing the entry of final judgment
on what otherwise would be an interlocutory order. See M. R. App. P. 6(5). The property
owners add that, even if not an interlocutory order, Oberlander failed to appeal the
dismissal of his prescriptive easement claim within the requisite thirty days.
See M. R. App. P. 4(5)(a)(i).
¶17 “[P]rovided that the order is the court’s final decision on the referenced matter,”
“[a]n order granting, dissolving, or refusing to grant an injunction is immediately
appealable, notwithstanding that the merits of the controversy remain to be determined.”
M. R. App. P. 6(3); Flora, ¶ 13 (citing M. R. App. P. 6(3)(e)). “Upon appeal from a final
judgment entered in an action or special proceeding in a district court, this court may review
the judgment, as well as all previous orders and rulings excepted or objected to which led
to and resulted in the judgment.” M. R. App. P. 6(1).
¶18 In his notice of appeal, Oberlander cites the Findings of Fact, Conclusions of Law
and Order Granting Preliminary Injunction entered by the District Court on May 16, 2022.
The District Court granted a preliminary injunction in favor of the property owners based
on its determination that Oberlander could not bring a prescriptive easement claim for lack
of standing and had no continuing claim to the property owners’ tracts. Oberlander argues
that the District Court erred in granting the preliminary injunction because it mistakenly
8
found he did not have standing. The court’s previous order dismissing Oberlander’s
prescriptive easement claim against the property owners “led to and resulted in” the
preliminary injunction order that Oberlander timely appealed. M. R. App. P. 6(1).
Oberlander’s prescriptive easement claim is properly before the Court. See M. R. App. P.
6(1), (3)(e). We turn to the merits.
¶19 The District Court determined that Oberlander did not have standing to assert a
prescriptive easement claim because “a prescriptive appurtenant easement attaches to the
State Land[;] it does not attach to the leasehold.” (Emphasis in original). The court agreed
with the property owners that because the State owns the land benefitted by the alleged
prescriptive easement, the State is the “holder of the alleged appurtenant easements.” It
therefore found that only the State, as the owner of the dominant tenement, could assert a
prescriptive easement claim; Oberlander could not bring the claim.
¶20 The parties agree that Oberlander seeks an appurtenant easement rather than an
easement in gross. “An easement appurtenant is one that benefits a particular parcel of
land, i.e., it serves the owner of that land and passes with the title to that land.” Blazer v.
Wall, 2008 MT 145, ¶ 24, 343 Mont. 173, 183 P.3d 84. “The land to which an easement
is attached is called the dominant tenement. The land upon which a burden or servitude is
held is called the servient tenement.” Section 70-17-103, MCA.
¶21 Oberlander argues that our precedent allows him to assert a prescriptive easement
claim as the owner of an estate in the dominant tenement at issue because the dominant
tenement is his leasehold, not the State land. Oberlander quotes our decision in Leichtfuss
9
v. Dabney, 2005 MT 271, ¶ 37, 329 Mont.129, 122 P.3d 1220, stating that it “may be more
precise to say that an easement runs with the estate in land to which it is appurtenant”;
rather than simply attaching to the “land.” (Emphasis in original). Oberlander argues that,
pursuant to Leichtfuss, “an estate less than fee simple may be the dominant tenement to an
appurtenant prescriptive easement.” Oberlander maintains, therefore, that he can bring the
prescriptive easement claim because he is the owner of an estate in the dominant tenement
pursuant to § 70-17-109, MCA.
¶22 The property owners counter that Oberlander cannot be the owner of the alleged
dominant tenement because he does not own the land that benefits from the alleged
easement. They maintain that because an appurtenant easement runs with the land it cannot
attach to the leasehold interest. Thus, a leasehold cannot be the dominant tenement in a
prescriptive easement claim. The property owners argue that the State, as owner of the
land, is the only appropriate party to bring an appurtenant prescriptive easement claim, and
it disclaimed any interest.
¶23 “It is well established that a prescriptive easement may be acquired by open,
exclusive, notorious, continued and uninterrupted use for a period of five years.”
Rasmussen v. Fowler, 245 Mont. 308, 311, 800 P.2d 1053, 1055 (1990) (citing
§ 70-19-401, MCA) (other citations omitted). Most cases within our jurisdiction that
regard a tenant’s relation to a prescriptive easement claim involved the owner of the land
benefitting from a prescriptive easement requesting this Court to count a lessee’s or life
tenant’s adverse use of property towards the owner’s continuous adverse use.
10
See, e.g., Cook v. Hartman, 2003 MT 251, ¶ 26, 317 Mont. 343, 77 P.3d 231; Slauson v.
Marozzo Plumbing & Heating, 2009 MT 333, ¶ 21, 353 Mont. 75, 219 P.3d 509; Leichtfuss,
¶ 41. We have concluded—in this regard—that a tenant’s adverse use of a property inures
to the benefit of the landowners when establishing a prescriptive easement. Cook, ¶ 28.
We thus have allowed a prescriptive easement to survive the extinguishment of an estate
held in less than fee simple. Slauson, ¶ 25.
¶24 The dominant tenement to a prescriptive easement is the parcel of land the easement
benefits. Slauson, ¶ 16. A person holding a possessory interest in the dominant tenement
that is less than fee simple may acquire and pass on a prescriptive easement appurtenant to
the dominant tenement. Leichtfuss, ¶ 37 (“[A]n easement appurtenant attaches to, passes
with, and is an incident of ownership for the particular land to which it is appurtenant.”).
Oberlander quotes Leichtfuss, arguing that the dominant tenement can be a person’s
possessory interest in the estate rather than the land itself; he relies also on our decision in
Slauson to support this contention.
¶25 In Leichtfuss, we recognized that a prescriptive easement may be established
through the use of a person who possesses the land in less than fee simple. Leichtfuss, ¶ 39
(citing Restatement (Third) of Prop.: Servitudes, § 2.5, cmt. A (2000)) (noting that “a
servitude may be created to burden or benefit any estate in land, including present
possessory estates and future estates.”) (Emphasis in original). We noted that an easement
might not extinguish immediately upon transfer of a possessory interest despite being
established by someone who did not own the land in less than fee simple. Leichtfuss,
11
¶¶ 39-43.1 In Slauson, we again acknowledged that a prescriptive easement created for the
benefit of an interest less than fee simple could be appurtenant and continue after transfer
of the interest. Slauson, ¶ 19. A person need not own the dominant tenement in fee simple
to establish an appurtenant prescriptive easement. Slauson, ¶ 19.
¶26 Any adverse use from Oberlander that could result in a prescriptive easement would
be to the benefit of the leased land—the dominant tenement—the fee simple owner of
which is the State. See Cook, ¶ 28 (recognizing that a tenant’s use may establish a
prescriptive right for the dominant owner). In Rasmussen, a case brought by a lessee, a
plaintiff who leased State land claimed a prescriptive right to cross over another’s property.
245 Mont. at 311, 800 P.2d at 1055. We affirmed the trial court’s conclusion that the
plaintiff and his predecessors had established a prescriptive right to his leasehold but did
so after upholding the trial court’s finding of a public easement to the state land at issue.
Rasmussen, 245 Mont. at 312, 800 P.2d at 1056. We agreed that Rasmussen could not be
granted an easement appurtenant to the state land but stated that “the lower court rightly
determined that there is such a right recognized in favor of the State as the owner through
long historical use, and that Rasmussen, in his standing, as lessee, has the right of use of
that easement for agricultural purposes.” Rasmussen, 245 Mont. at 313, 800 P.2d at 1056(emphasis added). Our precedent does not support Oberlander’s contention that he can
establish a prescriptive easement appurtenant because his leasehold is the dominant
1
Whether an easement terminates upon transfer of the estate could depend on the intent and
expectations of the involved parties. Leichtfuss, ¶ 42.
12
tenement. Neither Rasmussen nor the other cited cases, however, answers whether
Oberlander has standing through his leasehold interest to assert the prescriptive easement
claim.
¶27 The property owners argue that only the owner of the dominant tenement has
standing to bring a prescriptive easement claim; a tenant cannot bring such a claim. Our
cases do not squarely address this contention. Slauson, Leichtfuss, and Cook were all
claims brought by the landowner, and Rasmussen did not decide the issue. Other
jurisdictions, however, have considered a tenant’s standing to bring a prescriptive easement
claim and concluded that only landowners may bring these actions. See 7455 Inc. v. Tuala
Northwest, LLC, 274 Ore. App. 833, 839-44, 362 P.3d 1179, 1184-86 (2015) (citing
Sprague Corp. v. Sprague, 855 F. Supp. 423, 435 (D. Me. 1994) (plaintiffs with a tenancy
for years did not have standing to assert a prescriptive easement claim); Ammer v. Arizona
Water Co., 169 Ariz. 205, 210, 818 P.2d 190, 195 (Ariz. Ct. App. 1991) (“A tenant for life
or for years cannot establish such a [prescriptive appurtenant easement] right in his own
behalf.”)).
¶28 Though they do not cite it, the property owners raise an argument echoing the
Oregon Court of Appeals’ rationale in 7455 Inc. In that case, a tenant tried to bring “an
independent claim for a prescriptive easement,” arguing that if a landowner could count a
tenant’s adverse use and possession toward a prescriptive easement claim, then tenants
should have standing to bring independent prescriptive easement claims. 7455 Inc., 274
Ore. App. at 839, 362 P.3d at 1183. The court acknowledged that precedent allowed a
13
landowner to establish an adverse possession or prescriptive easement claim using a
tenant’s adverse use. 7455 Inc., 274 Ore. App. at 841-42, 362 P.3d at 1185 (citing Harrell
v. Tilley, 201 Ore. App. 464, 473, 119 P.3d 251, 256 (2005)). The court did not find
persuasive, however, the tenant’s logic that this principle also granted tenants the right to
bring prescriptive easement claims in their own right, noting the general rule that a “tenant
cannot originate adverse use in . . . [the] landlord’s favor unless the lease, expressly or
impliedly, includes the easement.” 7455 Inc., 274 Ore. App. at 843, 362 P.3d at 1186(quoting 28A C.J.S. Easements § 27 (2008)).2 The court concluded that even if a tenant’s
adverse use of a property inures to the benefit of the landowner and fits within the tenant’s
lease, bringing a claim for prescriptive easement rests solely within the landlord’s rights.
274 Ore. App. at 839-40, 844, 362 P.3d at 1184, 1186 (citing Ryan v. Tanabe Corp., 97
Haw. 305, 312, 37 P.3d 554, 561 (Haw. Ct. App. 1999); United States v. 43.12 Acres of
Land, More or Less, 554 F. Supp. 1039, 1042 (W.D. Mo. 1983)).
¶29 Montana, however, has a statute expressly allowing the “owner of any estate in a
dominant tenement or the occupant of such tenement [to] maintain an action for the
enforcement of an easement attached thereto.” Section 70-17-109, MCA (emphasis
added). This statute is part of the original Civil Code of 1895 and has never changed. The
property owners do not address how § 70-17-109, MCA, fits into their argument that only
2
In a footnote, the court acknowledged that though it discussed the parties’ arguments in terms of
standing, the reasons for dismissing a prescriptive easement claim brought by a tenant might more
appropriately be framed as failure to state a claim on which relief can be granted. 7455 Inc., 274
Ore. App. at 838 n.2, 362 P.3d at 1183 n.2.
14
the owner of the dominant tenement has standing to bring a prescriptive easement claim.
Nor do other jurisdictions address standing in the context of such a statute.
¶30 We have referenced § 70-17-109, MCA, sparingly—and never directly on point to
this issue. In Cook, we cited the statute in rejecting the defendant’s argument that an
occupant’s use of the property could not be evidence towards the owner’s continuous use
of the property when determining the existence of a prescriptive easement. Cook, ¶ 28.
We reasoned that because an occupant may enforce an easement under § 70-17-109, MCA,
it was “irrelevant” that the occupant was not the owner of the dominant tenement. Cook,
¶ 28. In JRN Holdings, we determined that a landowners’ association could bring a
prescriptive easement claim based on associational standing. JRN Holdings, ¶ 25. We
disagreed with the defendant’s argument that § 70-17-109, MCA, barred associational
standing because only “owners” or “occupants” could bring prescriptive easement claims.
JRN Holdings, ¶ 21. In Renner v. Nemitz, we cited to § 70-17-109, MCA, to excuse the
lack of a previous landowner’s testimony when the current landowner tried to assert a
prescriptive easement. 2001 MT 202, ¶ 27, 306 Mont. 292, 33 P.3d 255. We noted in
dictum that the children of the absent landowners, as “residents of and visitors to the
dominant estate,” could maintain an action for easement as occupants. Renner, ¶ 27.
¶31 The plain language of § 70-17-109, MCA, authorizes the owner of “any estate in a
dominant tenement or the occupant of such tenement” to enforce a prescriptive easement
claim. As previously discussed, the State land is the dominant tenement in this case.
Oberlander occupies this dominant tenement. Applying the clear and unambiguous
15
language of the statute, we conclude that Oberlander has standing to bring a prescriptive
easement claim because he is the occupant of the dominant tenement. The District Court
erred when it determined that only the owner of the dominant tenement had standing to
bring a prescriptive easement claim.
¶32 The District Court noted that the State does not claim a prescriptive easement. But
none of our cases have addressed whether an occupant of the dominant tenement may
establish a prescriptive easement when the landowner declines to assert the claim. We note
nothing in § 70-17-109, MCA, however, to indicate that the owner of the dominant
tenement must support a tenant’s adverse use of a property to bring a prescriptive easement
claim.3 Whether Oberlander may establish the alleged prescriptive easement in light of the
State’s refusal to take part in this case goes to the heart of his third-party claim against the
property owners. The ultimate merits of this claim were not before the District Court on a
motion for preliminary injunction. Because the court dismissed the claim for lack of
standing, the parties did not develop the issues, facts, and legal arguments associated with
the merits of Oberlander’s claim. We do not do so for the first time in the context of this
appeal.4
3
The court in 7455 Inc. addressed potential policy concerns regarding the enforcement of a
prescriptive easement if a landlord did not authorize the tenant’s adverse use within the lease. But
the court did not consider how a statute permitting an occupant to enforce an easement might alter
its analysis.
4
Oberlander’s claim may present special considerations due to the owner of the dominant tenement
being the State. Though some jurisdictions have held that a state may acquire a prescriptive
easement without effecting a taking of private property, at least one has expressed the view that
acquisition by a state of an easement by prescription could establish the basis of a takings claim.
16
CONCLUSION
¶33 The preliminary injunction was grounded in an improper conclusion that Oberlander
lacked standing. We reverse on that ground and remand for further proceedings.
/S/ BETH BAKER
We Concur:
/S/ JAMES JEREMIAH SHEA
/S/ LAURIE McKINNON
/S/ DIRK M. SANDEFUR
/S/ JIM RICE
See Bruce, Ely, & Brading. The Law of Esements and Licenses in Land § 5.29, pp. 412 n. 1-5, 413
n.3 (2d ed. 2022).
17