JRN Holdings v. Dearborn Meadows ( 2021 )

08/17/2021
DA 20-0517
Case Number: DA 20-0517
IN THE SUPREME COURT OF THE STATE OF MONTANA
2021 MT 204JRN HOLDINGS, LLC, A LIMITED LIABILITY COMPANY,
Plaintiff and Appellant,
v.
DEARBORN MEADOWS LAND OWNERS ASSOCIATION, INC.,
A Montana Nonprofit Corporation, Its President, JIM BECK,
Its Vice President, PAT RACICOT, Its Representative of Record,
ART POWELL, AND DOES 1-100, Consisting of all others who
claim a non-consensual right of access across Plaintiff’s real property,
Defendants and Appellees.
APPEAL FROM: District Court of the Eighth Judicial District,
In and For the County of Cascade, Cause No. ADV-17-0113
Honorable Gregory G. Pinski, Presiding Judge
COUNSEL OF RECORD:
For Appellant:
David B. Gallik, Gallik Law Office, PLLC, Helena, Montana
For Appellee:
Frederick F. Sherwood, Anne E. Sherwood, Morrison, Sherwood, Wilson
& Deola, PLLP, Helena, Montana
Submitted on Briefs: May 12, 2021
Decided: August 17, 2021
Filed:
cir-641.—if
__________________________________________
Clerk
Justice Beth Baker delivered the Opinion of the Court.
¶1 JRN Holdings, LLC (“JRN”), appeals the Eighth Judicial District Court’s ruling that
the Dearborn Meadows Land Owners Association, Inc. (“DMLOA”), established on behalf
of its members an implied easement by preexisting use and a prescriptive easement over
Powerline Road across JRN’s property. JRN additionally appeals the District Court’s order
awarding the DMLOA attorney fees. We affirm in part and reverse in part. We address
these restated issues:
1. Whether the District Court erred in concluding that both implied and prescriptive
easements existed for use by DMLOA members and the general public.
2. Whether the District Court abused its discretion by granting the DMLOA attorney fees
under § 27-8-313, MCA.
FACTUAL AND PROCEDURAL BACKGROUND
¶2 This case involves a dispute regarding the use of Powerline Road (“the Road”), an
unpaved road in the Dearborn Meadows area within both Cascade and Lewis and Clark
Counties. The Road intersects with Dearborn River Road—the main road providing access
to the Dearborn Meadows area—which leads to the interstate highway. The Road traverses
JRN’s property in Cascade County to where it meets the east bank of the Dearborn River
(“the River”), where a ford1 connects it to the west bank of the river; there, it continues on
its path through the Dearborn Meadows area of Lewis and Clark County.
1
A ford is “a tract of shallow water,” where a person may cross by wading (or presumably driving).
Ford, Oxford English Dictionary 1050 (Compact ed. 1971).
2
Figure 1: Portion of 1961 USGS Map of Cascade and Lewis & Clark Counties; Annotated by the DMLOA and included in its
Motion and Brief for Summary Judgment
3
1In tyin 12
0 t Oak
L.
rf d
oss
.
e
13
Figure 2: 2017 Montana Cadastral image identifying JRN’s Property; Annotations added by the DMLOA and included in its
Motion and Brief for Summary Judgment
¶3 Parties to the Case
¶4 The DMLOA was incorporated in 1977 for “[t]he primary and exclusive
purposes . . . [of] represent[ing] the interests of the property owners of that land
development known as Dearborn Meadows and Upper Sawmill,” including “maintain[ing]
a viable road system through Dearborn Meadows and Upper Sawmill” and “interact[ing]
with any individuals, groups, agencies, or corporations on behalf of the jointly-defined
concerns and goals of the property owners[.]” DMLOA “[m]embership is open to
4
landowners of Dearborn Meadows and surrounding areas who own land in recreation
developments.”
¶5 JRN is a limited liability company whose members are part of the Sechena family—
John Sechena, Ruth Sechena, and Nick Sechena. Sechena family members historically and
currently own other property in the Dearborn Meadows area. John, Ruth, and Nick all live
and work in Seattle, but they often spend their holidays in the Dearborn Meadows area.
John has a dental practice in Seattle which Ruth manages; Ruth previously worked as a
physician. JRN uses the property at issue in this suit to generate income from a vacation
rental, though Ruth testified that she and John purchased the property with the intent to
eventually retire in the area.
¶6 History of Dearborn Meadows
¶7 Prior to 1971, Nina and Fred Dear owned a large area of property on both the
Cascade and Lewis and Clark County sides of the lower Dearborn River. The Dears’
property encompassed the Dearborn Meadows area, which was undeveloped at the time,
including the property now owned by JRN. The Dears subdivided and then sold the
Dearborn Meadows area to LDS, Inc., (“LDS”) a developer that further subdivided the land
and sold the parcels to many different owners over at least the next couple of decades. In
1971, LDS sold the property now owned by JRN to its predecessors in interest.2 Neither
the deed from the Dears to LDS nor the deed from LDS to JRN’s predecessors in interest
expressly reserved an easement across the Road in Dearborn Meadows for access to the
2
JRN disputed below and continues to dispute that LDS ever owned its property, but it fails to
clearly articulate the relevance of this dispute to its argument on appeal.
5
remainder of the property. JRN’s property passed through two more ownerships before
JRN purchased it in 2010. In 1981, LDS sold the DMLOA two parcels adjacent to the east
bank of the river, which are now private parks designated for DMLOA members’ use.
¶8 The Road has existed since at least the 1960s. A power company originally built
the Road to access its overhead power lines, and it obtained an express easement over the
properties the Road traversed. The Road appears on a 1961 United States Geological
Survey (“USGS”) map (depicted above) and on aerial photographs taken since the 1960s.
It is apparent on the ground and is marked by its own “Powerline Road” sign. The Road
exists on both sides of the river. Although the location of the fords that cross the river has
changed over time, the location of the Road through JRN’s property has remained the same.
The Road historically has not been blocked with a gate or other barrier, but previous
landowners have posted “no trespassing” signs. The parties dispute the extent to which the
DMLOA has maintained the Road—DMLOA witnesses testified that it has maintained the
full length of the Road; JRN argues that the Road “was deeply rutted and dangerous to
drive” at the time it purchased the subject property in 2010, and that since this time it has
handled the Road’s maintenance over its property on the Cascade County side of the river.
Since Dearborn Meadows was developed, many nearby landowners used Powerline Road
to access the river for recreation and to reach the properties on the Lewis and Clark County
side of the river.
¶9 In the early 1970s, LDS constructed a ford about two hundred yards upstream from
the Road (“upstream ford”). The river flooded in 1974 or 1975, washing out and rendering
unusable the ford adjacent to the Road (“downstream ford”) until it was reconstructed in
6
1985. DMLOA landowners during this time thus used the upstream ford to access the
properties on the Lewis and Clark County side of the river; for example, Dale Rugwell—
who owns land directly across from the downstream ford—testified that he would drive
down the Road until he reached the river and then drive upstream along the east bank of
the river until he reached the upstream ford. Sometime after 1996, nearby landowners
allegedly blocked the upstream ford so that it was no longer usable.
¶10 Events Relevant to this Case
¶11 In 2012, JRN provided to the DMLOA landowners who access their property via
the Road notice of its intent to erect a gate across the Road. It explained in this notice letter
the purpose of its intended action:
THE PROBLEMS WE ALL FACE:
Unauthorized use of our properties – Some Dearborn Community
members, as well as outsiders, have used Powerline Road to access the
Dearborn River, your properties and ours. The result has been property
vandalism; forest fires set on the south side of the river by people who had
no right to be there; garbage and litter by the roadside; 4-wheelers and
hunters using land without permission; and unauthorized wood cutting.
Some campers believe it is their right to use Powerline Road as an access to
camp on our property and have threatened and intimidated our family and
friends. Some of you have recommended locking the gate and we agree it
will help solve many of our mutual problems.
Degradation of Powerline Road – Unauthorized traffic has degraded
Powerline Road significantly. We have provided gravel to improve its safety
and accessibility especially when wet. Decreasing traffic will slow the
degradation process and make the road safer for all of us. There may be
times that road repair is needed and we hope that we can collaboratively work
on this as neighbors because the [DMLOA] has limited resources.
Poor Condition of All Dearborn Community Roads – We believe that
preventing unauthorized Dearborn River access may encourage Dearborn
Landowners to pay their [DMLOA] dues especially if Community Park
7
usage is made contingent upon payment of dues. This additional revenue
will help maintain all our roads.
JRN’s notice letter advised the landowners to submit a request for a key or combination to
a lock it would be placing on the gate. It stated that “[i]n the process of doing this we are
sending letters to landowners who may use Powerline Road as it traverses our property to
get to their property on the south and west side of the Dearborn River . . . per the
recommendation of our attorney.” The attached “Lock Combination/Key Form” to be
filled out by the landowners stated: “I would like to receive the lock combination/key to
that gait [sic] for the sole purpose of gaining access to my property on the south and west
side of the Dearborn River”; “Use of this private road and/or adjacent property is prohibited
for any other reason, including gaining access from our property or the road to the
Dearborn River for fishing, floating, swimming, hiking, etc.” JRN alleges that it
“cleared [its plan to erect and lock the gate] with the fire department, law enforcement,
[the] power company, and sought and received a legal opinion that nobody had an easement
across its property at Powerline Road.”
¶12 JRN sent a second letter to the landowners in November 2012 indicating that it was
“proceed[ing] slowly to ensure that everyone whose sole property access is via this gate
has been identified and that they have received notification of our intent to close and lock
the gate.” It also stated that it was “confident” it had notified all such landowners and that
those who had responded—all but five landowners—supported its plan. It stated that it
had closed the gate but would not yet lock it. Several landowners responded to JRN’s letter
8
and received the key/combination to the lock. JRN then locked the gate in December 2012.
It received no objections regarding the locked gate at this time.
¶13 In 2013, JRN’s gate was torn down three times. JRN eventually filed suit against
two neighbors it alleged were responsible for these actions. The lawsuit was settled and
dismissed in May 2016. JRN by letter promptly notified the DMLOA of the settlement
and said:
[t]he gate previously erected by the Sechena’s [sic], near the river on their
property, will go back up and shall remain locked. Those who own property
on the west side of the Dearborn shall be given a key and the combination to
the gate and have permission to cross the Sechena’s property to access their
property at that point. There are no other easements across the Sechena’s
property.
The DMLOA called a special meeting in September 2016 in response to JRN’s notice. At
this meeting DMLOA members discussed their concerns about JRN’s gate blocking access
to the Road. Based on the members’ vote, the DMLOA sent a letter to JRN demanding
that it remove the gate, posts, and signs within thirty days or else the DMLOA would hire
a contractor to do so and would bill JRN for the associated costs.
¶14 In February 2017 JRN filed suit against the DMLOA and its officers, seeking
injunctive and declaratory relief that it had a right to place a locked gate across the Road
and that the DMLOA’s officers and members had no right to enter its property. JRN also
requested supplemental relief, including attorney fees, under the Uniform Declaratory
Judgments Act’s (“UDJA”) supplemental relief statute—§ 27-8-313, MCA.3 The DMLOA
3
Section 27-8-313, MCA, states:
9
denied JRN’s claims and counterclaimed that its members had an implied easement by
preexisting use and an easement by prescription over the Road to access the properties on
the west side of the river and to access the river for recreational purposes. The DMLOA
also requested “costs and attorneys’ fees, as allowed by law[.]” The parties stipulated that
during the litigation the gate would remain “dummy locked” but that DMLOA officers and
members would not use the road.
¶15 The parties filed cross-motions for summary judgment in late 2017, which the
District Court denied in a January 2018 Memorandum and Order. Among other things, the
court discussed the three elements for an implied easement by preexisting use. It
determined that the DMLOA had presented sufficient evidence to establish the first
element—common ownership—and part of the second element—apparent and continuous
use at the time of severance—but that neither party had presented sufficient evidence of
reasonable necessity or the intent of the parties to the deed at the time of severance. It thus
concluded there remained material facts in dispute that prevented it from making a
determination for that claim.
¶16 The District Court held a bench trial in February 2019 at which several landowners
testified. The court issued its findings of fact, conclusions of law, order, permanent
injunction, and judgment in September 2019, denying relief to JRN and concluding that
Further relief based on a declaratory judgment or decree may be granted whenever
necessary or proper. The application therefor shall be by petition to a court having
jurisdiction to grant the relief. If the application be deemed sufficient, the court
shall, on reasonable notice, require any adverse party whose rights have been
adjudicated by a declaratory judgment or decree to show cause why further relief
should not be granted forthwith.
10
the DMLOA had established easements by prescription and by preexisting use across the
Road for its members’ as well as the general public’s residential and recreational uses. It
enjoined JRN from blocking or otherwise interfering with access to the Road. The court
additionally allowed the DMLOA to petition the court for attorney fees under
§ 27-8-313, MCA, which it did. After briefing and an evidentiary hearing, in
September 2020 the court issued two orders awarding the DMLOA $96,650.18 in attorney
fees and costs.
STANDARDS OF REVIEW
¶17 We review a district court’s legal conclusions de novo for correctness. Davis v.
Westphal, 2017 MT 276, ¶ 10, 389 Mont. 251, 405 P.3d 73 (citation omitted);
Heffernan v. Missoula City Council, 2011 MT 91, ¶ 28, 360 Mont. 207, 255 P.3d 80(citations omitted) (identifying the question of standing as a question of law that should be
reviewed de novo). “We review the findings of a district court sitting without a jury to
determine if the court’s findings were clearly erroneous.” Ray v. Nansel, 2002 MT 191,
¶ 19, 311 Mont. 135, 53 P.3d 870 (citing M. R. Civ. P. 52(a)). A finding is clearly
erroneous “if substantial credible evidence does not support [it], if the trial court has
misapprehended the effect of the evidence[,] or if a review of the record leaves this Court
with the definite and firm conviction that a mistake has been committed.” Ray, ¶ 19
(citation omitted).
¶18 “This Court reviews a district court’s decisions on motions for summary judgment
de novo.” Frame v. Huber, 2010 MT 71, ¶ 7, 355 Mont. 515, 231 P.3d 589 (citation
omitted). We review for correctness a court’s conclusion regarding the existence of legal
11
authority to award attorney fees. Abbey/Land, LLC v. Glacier Constr. Partners, LLC, 2019
MT 19, ¶ 62, 394 Mont. 135, 433 P.3d 1230 (citation omitted). We review a court’s order
granting attorney fees for an abuse of discretion. Hughes v. Ahlgren, 2011 MT 189, ¶ 10,
361 Mont. 319, 258 P.3d 439 (citation omitted).
DISCUSSION
¶19 1. Whether the District Court erred in concluding that both implied and prescriptive
easements existed for use by DMLOA members and the general public.
¶20 A. Standing
¶21 We initially address JRN’s arguments that the DMLOA does not have standing to
pursue its claims. JRN appears to first argue that the DMLOA cannot maintain an action
for an implied or prescriptive easement on behalf of its members. It cites
§ 70-17-109, MCA, for this proposition, which states that “[t]he owner of any estate in a
dominant tenement or the occupant of such tenement may maintain an action for the
enforcement of an easement attached thereto.” JRN apparently contends that, as in
Beach Lateral Water Users Ass’n v. Harrison, 130 P.3d 1138 (Idaho 2006), the DMLOA
may not maintain associational standing for a claim of implied easement by preexisting use
when § 70-17-109, MCA, requires participation of each individual landowner seeking an
interest in the easement. JRN additionally argues that the DMLOA cannot assert an action
on behalf of the general public that seeks to use the Road for recreational purposes. It notes
that the DMLOA did not assert such an argument. It thus contends the District Court erred
by concluding that either type of easement could extend to the community for recreational
purposes.
12
¶22 Associational standing allows an organization to represent and protect its members’
rights. Heffernan, ¶ 42. This type of standing is an exception to the general rule that a
litigant may not raise a third party’s rights. Heffernan, ¶¶ 42, 44 (citation omitted) (under
the doctrine of associational standing, “the association and its members are in every
practical sense identical” (internal quotation marks omitted)). An organization may pursue
a legal claim on behalf of its members when: (1) at least one member has standing to pursue
such a claim in her or his own right; (2) the organization by pursuing the claim is protecting
interests germane to its purpose; and (3) neither the claim asserted, nor the relief requested,
requires individual participation of each injured party. Heffernan, ¶ 43 (citing Hunt v.
Wash. State Apple Advert. Comm’n, 432 U.S. 333, 343, 97 S. Ct. 2434, 2441 (1977); other
citation omitted).
¶23 The District Court correctly held that the DMLOA’s claims satisfy the Hunt test for
associational standing. First, all DMLOA members would have standing to bring a claim
seeking declaratory or injunctive relief pursuant to an implied or prescriptive easement
because they all are affected by JRN’s gate. Second, the DMLOA, by defending against
JRN’s suit and pursuing its easement claims, is acting on its corporate purposes as defined
in its Articles of Incorporation of “maintain[ing] a viable road system” and “interact[ing]
with any individuals, groups, agencies, or corporations on behalf of the jointly-defined
concerns and goals of the property owners[.]” See Heffernan, ¶ 43 (citing Hunt,
432 U.S. at 343, 97 S. Ct. at 2441).
¶24 Finally, all DMLOA members need not participate in this suit. We recognize the
applicability of the principles discussed in Beach Lateral Water Users Ass’n to an analysis
13
of the third Hunt factor. The Idaho court in that case explained that “[w]hen an association
seeks some form of prospective relief, such as a declaration or an injunction, its benefits
will likely be shared by the association’s members without any need for individualized
findings of injury that would require the direct participation of its members as named
parties.” Beach Lateral Water Users Ass’n, 130 P.3d at 1142 (citing Hunt, 432 U.S. at 343,
97 S. Ct. at 2441). It thus concluded that though the association’s claims for
injunctive relief with respect to an implied easement were actionable, the association could
not maintain associational standing on behalf of itself to quiet title in any such easement
where it “d[id] not own any of the dominant estates that would be served by the ditch
easement in dispute.” Beach Lateral Water Users Ass’n, 130 P.3d at 1142; see also
Meadow Lake Estates Homeowners Ass’n v. Shoemaker, 2008 MT 41, 341 Mont. 345, 178
P.3d 81 (allowing a homeowner’s association to maintain an action for injunctive relief on
behalf of its members to enforce an easement). Because the DMLOA sought relief in the
form of declaratory and injunctive relief, rather than to quiet title in its own name or in the
names of its members, the District Court correctly held that it satisfied the third requirement
of the Hunt test. Heffernan, ¶ 43 (citing Hunt, 432 U.S. at 343, 97 S. Ct. at 2441).
¶25 The District Court thus properly concluded that the DMLOA has associational
standing to pursue its easement claims on behalf of its members. We agree with JRN,
however, that the DMLOA did not assert its claim on behalf of the general public, nor does
it defend against this argument on appeal. The DMLOA does not have standing to bring
such an action on behalf of the general public, nor did it attempt to do so. We thus reverse
any finding of easements by preexisting use or prescription for the general public’s use.
14
¶26 B. Implied Easement by Preexisting Use
¶27 “An easement may be created by an instrument in writing, by operation of law, or
by prescription.” Yellowstone River, LLC v. Meriwether Land Fund I, LLC, 2011 MT 263,
¶ 25, 362 Mont. 273, 264 P.3d 1065 (citations omitted). Implied easements are
“created by operation of law at the time of severance” of two parcels that originally were
in common ownership. Hoyem Tr. v. Galt, 1998 MT 300, ¶ 17, 292 Mont. 56,
968 P.2d 1135; Wolf v. Owens, 2007 MT 302, ¶¶ 16–17, 340 Mont. 74, 172 P.3d 124.
There are two different types of implied easements: those by necessity and those by
preexisting use. Hoyem Tr., ¶ 17; Wolf, ¶¶ 16–17. “Easements by necessity are typically
implied to provide access to a landlocked parcel, while easements by existing use are based
on a landowner’s prior use of part of his property (the quasi-servient tenement) for the
benefit of another part of his property (the quasi-dominant tenement).” Yellowstone River,
¶ 30 (citation omitted); Hoyem Tr., ¶¶ 18–19, 29; Wolf, ¶¶ 16–17. “Implied easements rest
upon the intent of parties gathered from the evidence.” White v. Landerdahl,
191 Mont. 554, 558, 625 P.2d 1145, 1147 (1981) (citation omitted).
¶28 To establish an implied easement by preexisting use, a party must show that: (1) the
dominant and servient tenements are severed from a common ownership (“unity of
ownership”); (2) the use of the servient tenement is apparent, continuous, and reasonably
necessary for the beneficial use and enjoyment of the dominant tenement at the time of
severance; and (3) the parties to the deed that severed the tenements intended the use to
continue after the division. Yellowstone River, ¶ 30 (citing Waters v. Blagg, 2008 MT 451,
15
¶ 14, 348 Mont. 48, 202 P.3d 110 (overruled on other grounds in Earl v. Pavex Corp.,
2013 MT 343, ¶ 31, 372 Mont. 476, 313 P.3d 154)).
¶29 JRN argues that the District Court clearly erred when it determined that the DMLOA
established by clear and convincing evidence all elements for an implied easement by
preexisting use. JRN contends that, pursuant to Frame, ¶¶ 16–18, the
“common ownership” element for all implied easements—both those by necessity and
those by preexisting use—requires that the dominant and servient tenements be contiguous.
It argues that this requirement cannot be met under the circumstances because, as in Frame,
“the State of Montana owns the banks and beds of the Dearborn River[,]” which separates
JRN’s property from the properties across the river that are claiming the implied easement.
¶30 Both easements by preexisting use and easements by necessity require unity of
ownership at the time of severance. Hoyem Tr., ¶¶ 18, 22. Unity of ownership arises from
the fact that the dominant and servient parcels were owned by one person or entity
immediately prior to their severance. Frame, ¶ 12; Schmid v. McDowell, 199 Mont. 233,
238, 649 P.2d 431, 433 (1982)); Woods v. Houle, 235 Mont. 158, 162, 766 P.2d 250, 253
(1988) (citation omitted). “[A] way of necessity can only arise out of the land granted or
reserved by the grantor and never out of the land of a third party or a stranger to the title.”
Schmid, 199 Mont. at 238, 649 P.2d at 433 (citing Zimmerman v. Summers, 330 A.2d 722,
730 (Md. Ct. Spec. App. 1975); Robertson v. Robertson, 197 S.E.2d 183, 187 (Va. 1973));
see also Loomis v. Luraski, 2001 MT 223, ¶ 31, 306 Mont. 478, 36 P.3d 862 (citations
omitted) (noting that “an easement cannot be reserved in favor of a stranger to the deed”
because the dominant estate would not have the opportunity to negotiate with the grantor,
16
the easement would not appear in the chain of title which would leave bona fide purchasers
without notice, and such an easement may lead to unexpected taxes, environmental
concerns, and potential litigation). JRN does not appear to dispute on appeal the
District Court’s finding that the Dearborn Meadows properties involved in this dispute
were held by the same person or entity immediately prior to their severance.
¶31 Easements by necessity and preexisting use part company in their remaining
elements. For easements by necessity, its single remaining element is that of
“strict necessity,” which “requires that there be no practical access to a public road from
the landlocked parcel except across lands that were formerly in common ownership.”
Yellowstone River, ¶¶ 30, 46 (citation omitted). Strict necessity allows the required
inference that the parties to the deed would not have intended to leave a parcel landlocked.
See Hoyem Tr., ¶ 19 (quoting Graham v. Mack, 216 Mont. 165, 175, 699 P.2d 590,
596 (1984)) (easements by necessity give effect to the “strong public policy against
shutting off a tract of land and thus rendering it unusable [which] gives rise to a fictional
intent defeating any such restraint” (internal quotation marks omitted)). Because
easements by preexisting use allow intent to be inferred from the use itself,
see Waters, ¶ 17; Hoyem Tr., ¶ 29, this type of easement requires only that the easement
be “reasonably necessary . . . for the beneficial use and enjoyment” of the dominant
tenement. Yellowstone River, ¶ 30.
¶32 In Schmid, this Court considered whether an implied easement by necessity had
been established for the benefit of one parcel over the other when both parcels
“were landlocked with no access to a public road except across state or [third-party] lands.”
17
Schmid, 199 Mont. at 236, 649 P.2d at 432. We concluded that an easement by necessity
could not exist because neither the alleged dominant tenement nor the alleged servient
tenement had access to a public road when the property was divided, a requirement to
establish the “strict necessity” element for easements by necessity. Schmid,
199 Mont. at 238, 649 P.2d at 433 (citing Griffin v. North, 373 So. 2d 96, 97
(Fla. Dist. Ct. App. 1979); Daywalt v. Walker, 31 Cal. Rptr. 899, 903 (Cal. Ct. App. 1963)).
Because the easement additionally would have to cross State land not held in common
ownership at the time of severance to reach such a public road, there was no way for the
claimants to establish an easement by necessity. Schmid, 199 Mont. at 236–38,
649 P.2d at 432–33 (citations omitted).
¶33 We relied on the concepts underlying Schmid in Frame. There, this Court
considered whether an easement by necessity existed in the Dearborn River area.
Frame, ¶¶ 1–2. The purported dominant tenement used a road on the purported servient
tenement that led to the Dearborn River and always had been controlled by a gate.
Frame, ¶ 4. Relying on Schmid’s conclusion that an easement by necessity could not exist
where the easement would have to cross a third party’s property to meet the strict necessity
element, we concluded that “[t]he unity of ownership required to imply an easement by
necessity cannot exist in this case . . . because the State-owned bed and banks of the
Dearborn River separate the Poole/Huber land from the Frame land. . . . The River has
always separated the tracts.” Frame, ¶ 16. The Court thus specifically articulated the
requirement for easements by necessity that the parcels held in common ownership be
contiguous. Frame, ¶¶ 16–18. See also Yellowstone River, ¶ 35 (citing Thompson on Real
18
Property vol. 7, § 60.03(b)(5)(iii), 506 (2d Thomas ed., Matthew Bender 2006))
(“[a]n easement by necessity cannot be created unless the dominant and servient tenements
were originally one piece of property”).
¶34 Both Schmid and Frame involved claims to an implied easement by necessity. The
rationale underlying those decisions was based in the “strict necessity” element for such
easements. See Schmid, 199 Mont. at 238, 649 P.2d at 433 (“a way of necessity cannot
exist across land which had no access to a public road when the property was divided by
the common grantor”); Frame, ¶ 17 (“An easement by necessity can be implied, if at all,
only to cross lands formerly held in unified ownership to reach a public road. An easement
by necessity cannot be implied to merely reach the land of a third party which was not part
of the original unified ownership.”). We observed in Schmid, 199 Mont. at 237,
649 P.2d at 432–33, that “[a] way of necessity is distinguished from other implied
easements” in that it need not be in existence or “open and visible” at the time of
conveyance. Schmid’s holding regarding the contiguous nature of the parcels necessarily
flowed from the lack of strict necessity and does not supply controlling authority for
easements by preexisting use, which are in existence at the time of conveyance and do not
share the strict necessity requirement.
¶35 The elements for implied easements by preexisting use do not require that the
severed parcels be contiguous. Easements by necessity are available only to a dominant
parcel that is truly landlocked, at least in part, by the servient parcel. This requirement
recognizes that easements by necessity do not infer intent from a route previously in
existence: the only reasonable way, then, to impose the required fictional intent of the
19
original parties is to ensure that the original parties’ parcels were truly contiguous.
See Hoyem Tr., ¶ 19 (quoting Graham, 216 Mont. at 175, 699 P.2d at 596).
[I]f the alleged dominant and servient parcels were never held in common
ownership, or if the particular severance did not leave the dominant estate
isolated, then the inferred intent theory fails and the doctrine of easement by
necessity simply has no application. But, if the alleged dominant and
servient parcels were held in common ownership, and if a severance of that
unified property resulted in a landlocked parcel and a non-landlocked
parcel, then it is inferred that the common owner intended at the time of
severance to grant or reserve an easement over the non-landlocked parcel for
the benefit of the landlocked one.
Yellowstone River, ¶ 38 (emphasis added); see also Frame, ¶ 10 (citing Big Sky Hidden
Vill. Owners Ass’n v. Hidden Vill., Inc., 276 Mont. 268, 277, 915 P.2d 845, 850 (1996))
(“Easements by necessity arose from a public policy against isolating tracts of land and
thereby minimizing their utility, . . . but they may arise only in the specific circumstances
that come within the requirements of law. Implied easements by necessity have never been
intended to provide access across the land of others to benefit any and all landlocked
property.”).
¶36 Easements by preexisting use, however, do not necessarily require the dominant
parcel be “landlocked” because the parties’ intent may be inferred directly from the prior
use. See, e.g., Waters, ¶¶ 16–18 (recognizing that only easements by necessity require a
direct connection to a public road over the land once held in common ownership because
of the “critical distinction” between the two types of easements—that those based on
preexisting use depend upon a route already in existence). Waters further clarified this
distinction:
20
The rationale behind this distinction is more practical th[a]n academic.
Where a party seeks recognition of an implied easement by pre-existing use,
the road in question is already being used for access to the outside world.
Conversely, when an easement by necessity is being claimed where there is
no connection to a public roadway, “the basic reason for the creation of a
way of necessity, namely, to permit communication with the outside world,
is not present.” Schmid v. McDowell, 199 Mont. 233, 238, 649 P.2d 431, 433
(1982) (internal citations omitted). Such an easement would represent the
proverbial “road to nowhere.”
Waters, ¶ 17. The basis of the inferred intent for an easement by preexisting use—the prior
use itself—is less attenuated than the basis of the inferred intent for an easement by
necessity—the fact that the parcel is landlocked. Thus, though easements by necessity
demand that the parcels be contiguous, easements by preexisting use do not demand such
a requirement.4
¶37 The District Court thus did not clearly err in its determination that the DMLOA
established the unity of ownership and reasonable necessity elements for an implied
easement by preexisting use. Based on our disposition of this issue, we need not address
JRN’s related arguments regarding the District Court’s denial of its summary judgment
motion.
¶38 Finally, though JRN fails to clearly articulate its argument on appeal, it appears to
claim that the DMLOA failed to establish the element of intent for an easement by
4
Though we did not differentiate between the types of implied easements in Davis v. Hall,
2012 MT 125, ¶ 29, 365 Mont. 216, 280 P.3d 261, and Meine v. Hren Ranches, Inc., 2015 MT 21,
¶ 27, 378 Mont. 100, 342 P.3d 22, when we stated that only implied easements garnered application
of the somewhat related rule requiring “the dominant and servient estates . . . [to] physically abut
in order to create an easement appurtenant[,]” these comments were in dicta as neither case dealt
with implied easements. Hall, ¶¶ 1–2 (considering an express easement); Meine, ¶ 1 (considering
a prescriptive easement). We thus do not find these comments controlling here.
21
preexisting use. Our review of the record supports the District Court’s conclusion that the
parties to the deed at the time of severance intended the Road be used to access the river
for the purpose of reaching those parcels within Cascade County and Lewis and Clark
County that could not otherwise be accessed: at the time of severance the Road was the
only way to access the footbridge or ford that crosses the Dearborn River, which in turn is
the only access to the properties on the west side of the river in Lewis & Clark County; and
the original efforts to develop the properties across the river create an inference that the
parties intended this use to continue.5 See Hoyem Tr., ¶ 23; Wolf, ¶ 21; Waters, ¶ 22;
Tungsten Holdings, Inc. v. Kimberlin, 2000 MT 24, ¶ 27, 298 Mont. 176, 994 P.2d 1114(a court may infer from the totality of the circumstances at the time of conveyance the
parties’ reasonable expectations); see also Graham, 216 Mont. at 174, 699 P.2d at 596
(a court may infer the parties’ intent from use so long as obvious or from a manifestation
that use should be permanent). We agree with JRN, however, that the DMLOA did not
establish by clear and convincing evidence that the original parties that severed the property
5
JRN also appears to contend that the District Court erred by denying its motion for summary
judgment based on a lack of evidence regarding the elements of reasonable necessity and intent
because:
[w]hen JRN met its initial burden of showing there were no easements of record,
other than the express utility easement in its deed, the burden shifted to the
[DMLOA] to establish [the elements of intent and reasonable necessity] with
substantial evidence, as opposed to mere denial, speculation, or conclusory
statements[.]
Our review of the record supports the District Court’s conclusion that there remained material facts
in dispute regarding these elements. See Westphal, ¶ 12 (citing Weber v. Interbel Tel. Coop., Inc.,
2003 MT 320, ¶ 5, 318 Mont. 295, 80 P.3d 88) (a court must “draw all reasonable inferences
against summary judgment”).
22
intended all Dearborn Meadows residents—even those on the Cascade County side of the
River with other means of access to their property—to be able to use the Road for
recreational purposes. See Waters, ¶ 20 (citation omitted) (“The scope of an implied
easement is controlled by the apparent intent of the landowner who effected a severance of
the dominant and servient estates.”). We therefore hold that the District Court did not err
in its conclusion that an implied easement by preexisting use was established, but we
conclude that this implied easement was established only for residential use of the
properties in Lewis and Clark County and for the properties in Cascade County that have
no other means of access to reach their land.
¶39 C. Prescriptive Easement
¶40 Similar to implied easements, prescriptive easements are created by operation of
law. Heller v. Gremaux, 2002 MT 199, ¶ 12, 311 Mont. 178, 53 P.3d 1259 (citation
omitted). To establish a prescriptive easement, a party must demonstrate its use of
another’s property is open and notorious, exclusive, adverse, and continuous and
uninterrupted for the five-year statutory period. Pedersen v. Ziehl, 2013 MT 306, ¶ 13,
372 Mont. 223, 311 P.3d 765 (citing Heller, ¶ 12; § 70-19-404, MCA). If the claimant
establishes the elements of a prescriptive easement, adverse use is presumed and the burden
shifts to the owner of the servient estate to establish that the use was permissive.
Heller, ¶ 15 (citation omitted); State v. Cronin, 179 Mont. 481, 488, 587 P.2d 395, 400
(1978).
¶41 Each element for an easement by prescriptive use must be established by clear and
convincing evidence. Heller, ¶ 15 (citation omitted). “Open and notorious” means
23
“a distinct and positive assertion of a right hostile to the rights of the owner and brought to
the attention of the owner.” Brumit v. Lewis, 2002 MT 346, ¶¶ 15, 17–18, 313 Mont. 332,
61 P.3d 138 (use or maintenance that is not covert or hidden is enough to establish the
element of open and notorious use). “[E]xclusive use means no more than that the right of
the claimant must rest upon its own foundations and not depend upon a like right in any
other person.” Lemont Land Corp. v. Rogers, 269 Mont. 180, 185, 887 P.2d 724,
727 (1994) (citation omitted). “Adverse” use means “that the use is exercised under a
claim of right and not as a mere privilege or license revocable at the pleasure of the owner
of the land; such claim must be known to, and acquiesced in by, the owner of the land.”
Rafanelli v. Dale, 278 Mont. 28, 34, 924 P.2d 242, 246 (1996) (citation, internal quotation
marks omitted). Adversity may be supported by evidence of use that disregards a gate or
“no trespassing” sign, or by evidence of “[r]egular maintenance of a road by the party
asserting a prescriptive easement[,]” though this evidence is not dispositive of the element.
See Rafanelli, 278 Mont. at 35–37, 924 P.2d at 246–48 (citing Swandal Ranch Co. v. Hunt,
276 Mont. 229, 234, 915 P.2d 840, 844 (1996)). “Continuous and uninterrupted use” is
regular use “made often enough to constitute notice of the claim to the potential servient
owner”; it “does not mean constant use” but rather use “whenever . . . desired, without
interference by the owner of the servient estate[.]” Cook v. Hartman, 2003 MT 251, ¶ 29,
317 Mont. 343, 77 P.3d 231 (citation omitted).
¶42 JRN argues that the District Court clearly erred when it concluded that the DMLOA
had established by clear and convincing evidence all elements for a prescriptive easement.
JRN argues that, because the properties’ severance occurred in 1971 and there was a flood
24
in 1974 or 1975 that prevented use of the adjacent river ford until it was rebuilt in 1985,
there was insufficient time for any DMLOA members to establish five years of prescriptive
use before 1979—the date by which the District Court concluded the prescriptive easement
had been established. JRN additionally argues generally that the evidence and testimony
at trial was insufficient to provide a factual basis to find all necessary elements of a
prescriptive easement for the requisite five years.6
¶43 The District Court concluded that the DMLOA had established, “certainly by 1979,”
a prescriptive easement. The District Court made several findings of fact, including
that: (1) the Road has existed for decades, appearing on a 1961 USGS map and aerial
photographs, visible on the ground on both sides of the river, designated with a sign, and
connecting to the main road in the area; (2) DMLOA members for decades have used the
Road without permission to access their properties and to access the river for recreation
within the river high-water marks; (3) the ford connected to the Road is the only way to
access the properties across the river—including property of at least thirty-six lot owners—
and, though the location of the ford has changed, the location of the Road has not changed;
(4) JRN was aware people traveled on the Road through its property when it purchased the
6
JRN also contends that, because § 70-17-109, MCA, allows only an owner of a dominant estate
to maintain an action for the enforcement of an easement—and the DMLOA did not own property
in Dearborn Meadows until 1981—the DMLOA could not have established five years of
prescriptive use by the time such an action was rendered impossible by a 1985 legislative
enactment preventing the establishment of a prescriptive easement through “(a) recreational use of
surface waters, including: (i) the streambeds underlying them; (ii) the banks up to the ordinary
high-water mark; or (iii) any portage over and around barriers; or (b) the entering or crossing of
private property to reach surface waters.” Section 23-2-322(2), MCA. This argument fails. As
discussed above, § 70-17-109, MCA, does not prevent an organization from asserting an action
under the doctrine of associational standing, and the DMLOA’s claims are thus based on the
landowners’ use of the Road since the time of severance.
25
property; (5) the Road was never gated or blocked by any prior property owners until JRN
installed the gate in 2012 and offered adjoining landowners a key “if they agreed to JRN’s
use conditions[,]” including “a provision allowing JRN (or a successor-in-interest) to
withdraw use permission at any time, thus impeding access to the adjacent properties.”7
¶44 Based on these findings, the District Court concluded that community use of the
Road was open, notorious, apparent, and obvious. It concluded that the community use
was extensive and continuous, dating back decades to access properties and the River for
recreation. It concluded the community use was exclusive, requiring no landowner
permission, and that this use was never blocked until JRN placed its gate in 2012 which,
although it slowed use of the Road, has not prevented it. Finally, the court concluded the
community’s use is adverse because of the continued residential and recreational uses
despite the gate and “no trespassing” signs.
¶45 The District Court’s findings are well supported by the record. The DMLOA
presented ten witnesses who testified that the Road dating back to 1971 has been used
without impediment in an open, notorious, exclusive, adverse, and continuous manner to
reach the River and the properties located across the River. We find unpersuasive JRN’s
argument that the flood in 1974 or 1975 necessarily must have stalled use of the Road; the
record shows that, despite washout of the downstream ford, landowners continued to use
the Road during this time as a means of accessing the River and would then move upstream
on the Cascade County side of the River until they reached the upstream ford. As noted
7
JRN’s notice letter included in the record does not contain any such provision.
26
by the DMLOA: “[t]his case is about a road on JRN property that goes to a river, not a ford
across the riverbed owned by the State of Montana.” The record demonstrates that
DMLOA members continued to use the Road to access the River, either for recreational
purposes or in order to drive along the River’s edge to reach the upstream ford.
¶46 The District Court thus did not clearly err in concluding that the DMLOA
established by clear and convincing evidence a prescriptive easement over the Road for its
members’ residential and recreational use.
¶47 2. Whether the District Court abused its discretion by granting the DMLOA attorney
fees under § 27-8-313, MCA.
¶48 “Montana generally follows the American Rule that a party may not recover
attorney fees in a civil action absent a specific contractual or statutory provision.”
Hughes, ¶ 13 (citations omitted). When a party asserts the UDJA as the remedy in a case,
however, we have recognized that the party may petition the court for attorney fees under
§ 27-8-313, MCA—that section provides that a court may grant “[f]urther relief based on
a declaratory judgment . . . whenever necessary or proper.” See Hughes, ¶ 13 (citing
Mungas v. Great Falls Clinic, LLP, 2009 MT 426, ¶ 43, 354 Mont. 50, 221 P.3d 1230);
Renville v. Farmers Ins. Exch., 2004 MT 366, ¶¶ 27–28, 324 Mont. 509, 105 P.3d 280.
¶49 A. Application of the UDJA
¶50 JRN first asserts that the District Court erred by allowing the DMLOA to petition
for attorney fees when the DMLOA did not assert in its Counterclaim that it sought relief
under the UDJA. JRN contends that the DMLOA could not have made such a request in
any event because it did not seek a declaration of its rights under a written instrument as
27
required by the UDJA, § 27-8-202, MCA. Citing Hughes and Steiger v. Brown,
2007 MT 29, 336 Mont. 29, 152 P.3d 705, JRN further contends that Montana law is in
conflict whether the UDJA may be applied to cases involving easement disputes. It argues
that the circumstances here warrant application of Steiger, in which we held that the UDJA
could not appropriately be applied in a case involving a prescriptive easement because such
a case does not involve the rights of the parties under a written document.
¶51 The District Court concluded that, “[a]lthough Defendants do not expressly raise
the Uniform Declaratory Judgment[s] Act in their counterclaim, Defendants cite the statute
for awarding attorney’s fees in their proposed findings of fact and conclusions of law.” It
further noted that “JRN framed this case as one for declaratory judgment and the parties
seek corresponding relief on the same legal issue, to wit, whether a Powerline Road
easement exists on the JRN property.”
¶52 We have held that the UDJA “merely supplement[s] other claims and remedies
independently available at law or in equity[,]” including injunctive relief “where ‘necessary
or proper’ to effect or enforce a declaratory judgment.” Westphal, ¶ 20 (citing
M. R. Civ. P. 57; 26 C.J.S. Declaratory Judgments §§ 1–2 (2011)). There is thus no
obvious problem with applying it in cases of real property disputes. And indeed, the UDJA
previously has been applied to real property disputes, even where a written document was
not interpreted. See, e.g., Wolf, ¶ 9; Hughes, ¶ 9. In Hughes, we considered an appeal
regarding attorney fees granted under the UDJA in an easement dispute—the only issue
being whether the equities supported such a grant of fees. See Hughes, ¶¶ 9, 12. There,
the plaintiff brought a claim for prescriptive easement under the UDJA, but the defendant
28
ultimately prevailed and the court granted her attorney fees pursuant to § 27-8-313, MCA.
Hughes, ¶ 9. Plaintiff appealed the grant of attorney fees, arguing only that the equitable
considerations did not merit the award. Hughes, ¶ 12.
¶53 In Steiger, the plaintiffs alleged encroachment and trespass based on the defendant’s
garage allegedly crossing their boundary line, and they requested a boundary line
determination. Steiger, ¶ 9. The defendant in her amended answer characterized the
plaintiffs’ complaint as a petition for declaratory judgment—though plaintiffs had not
made such a claim—and she asserted claims for adverse possession and prescriptive
easement. Steiger, ¶ 9. The district court concluded, among other things, that the defendant
had no right to erect a fence over its property, but it denied fees to the plaintiffs
“because their suit was not truly a declaratory judgment action.” Steiger, ¶¶ 12–13.
Plaintiffs then filed a motion to amend the judgment, seeking to convert the judgment into
one for declaratory judgment and thereby recover their attorney fees, which the district
court also denied because the case did not involve the interpretation of a written instrument.
Steiger, ¶ 15. This Court affirmed, holding that plaintiffs were not entitled to an amended
judgment because the case
involve[d] the determination of a boundary line, premised not upon the
interpretation or construction of respective deeds but upon competing
surveys. Since the controversy in this case did not involve the construction
of a deed or another instrument, statute, ordinance, contract or franchise, it is
not a declaratory judgment action
and thus there was no basis for the award. Steiger, ¶¶ 27–29 (citing § 27-8-202, MCA).
¶54 Unlike Steiger, where the plaintiff never asserted the UDJA and the claims asserted
involved no interpretation of written documents, JRN here explicitly asserted the UDJA in
29
its complaint, requesting relief in the form of declaratory judgment “as an interested person
under a deed to the above referenced real property” and framing the case as one involving
the interpretation of a deed. The DMLOA’s counterclaims thus directly flowed from and
responded to JRN’s claims. See Trs. of Ind. Univ. v. Buxaum, 2003 MT 97, ¶¶ 23–24,
315 Mont. 210, 69 P.3d 663 (Concluding that an award of attorney fees under the UDJA
to defendant estate was appropriate despite the defendant’s failure to explicitly reference
§ 27-8-313, MCA, where “the parties clearly litigated the underlying coverage dispute
within the confines of the UDJA. In fact, they did so at the [plaintiff] University’s
behest.”). The District Court thus properly concluded that under the circumstances
declaratory judgment was an appropriate form of relief for the DMLOA’s claims of implied
and prescriptive easements.
¶55 B. Consideration of the Equities
¶56 JRN argues in the alternative that the District Court abused its discretion when it
determined that the equities warranted an award of attorney fees in this case. It contends
that the court should not have granted attorney fees because “JRN consistently sought a
civil remedy to the issues and disputes, while the [DMLOA] and its members resorted to
self help measures of destroying JRN’s property.” JRN argues that the history of violence
in the Dearborn area compelled it to pursue this lawsuit, stating that it “rationally
determined, in order to have a peaceful solution, judicial resolution was necessary so that
JRN members and their heirs would not be intimidated or hurt while enjoying its property.
Everyone in the community needed to know the rules so that they could all enjoy their own
properties.”
30
¶57 Before considering whether attorney fees are “necessary and proper” under UDJA’s
supplemental relief statute, a court first must determine whether such an award rests in
equity. Hughes, ¶ 13 (citing United Nat’l Ins. Co. v. St. Paul Fire & Marine Ins. Co.,
2009 MT 269, ¶ 38, 352 Mont. 105, 214 P.3d 1260; Mungas, ¶ 45). Merely prevailing
“in defending private property rights cannot qualify as a sufficiently compelling reason to
justify an award of attorney fees under § 27-8-313, MCA.” Hughes, ¶ 20 (citing Mungas,
¶ 44; Martin v. SAIF Corp., 2007 MT 234, ¶¶ 25, 28, 339 Mont. 167, 167 P.3d 916).
Instead, the equities will support such an award when it will prevent an “anomalous result,”
such as when a party “accrue[s] a significant amount of attorney fees in order to recover a
comparatively small award of damages.” Hughes, ¶ 15 (citing Renville, ¶¶ 18, 22;
United Nat’l Ins., ¶ 38) (explaining that the party seeking attorney fees “would have been
better off had she never brought the claim in the first place without an award of fees to
cover the cost of collecting the disputed damages”). “Equity generally does not support an
award of attorney fees under the UDJA, however, if similarly situated parties genuinely
dispute their rights.” Hughes, ¶ 16 (citing United Nat’l Ins., ¶ 39; Mungas, ¶ 46).
¶58 The District Court held that the equities supported an award of attorney fees to the
DMLOA because the parties were in an unequal position in the litigation. It concluded that
the lawsuit was “initiated by JRN against a voluntary association with very limited
resources and for the purpose of JRN seeking a judicial stamp of approval for its unilateral
decision to put a gate on a community road simply because it dislikes the public accessing
the Dearborn River near its land.” The District Court reasoned that the DMLOA is similar
to the defendants in City of Helena v. Svee, 2014 MT 311, 377 Mont 158, 339 P.3d 32, and
31
Buxaum, who “were successful at trial and had very limited resources to defend the suits
brought against them by more financially capable, sophisticated plaintiffs.” The
District Court found that the DMLOA is a voluntary association that is “always cash
strapped,” relying on voluntary payment of dues that it has no meaningful way to enforce;
“[i]t is burdened with maintaining hundreds of miles of roads” and must ask volunteers to
maintain its two community parks; and it has had to rely on fundraising efforts to defend
its suit and pursue its counterclaims. The District Court thus concluded:
Without an award of attorney fees, the DMLOA and the individual
defendants stand to be in a worse position than if they had never responded
to the Complaint. They will have secured an important easement ruling for
the benefit of all land owners in the Dearborn Meadows area but will have
lost the ability to maintain the roads and might have to sell of [sic] one of the
community parks to pay for attorney fees if fundraising falls short.
The District Court then compared JRN’s position:
the principal members of JRN Holdings are Seattle-based professionals who
own several vacation properties along the Dearborn River. They determined
they had ample personal resources to commence and prosecute this litigation.
They did not need a yearlong delay in trial date to fundraise money for their
attorneys to proceed. The Court does not know their precise wealth, but the
Court knows the relative positions of JRN Holdings and the Defendants are
worlds apart in terms of wealth and means to pursue this litigation.
¶59 In Svee, the city filed criminal and civil suits against the Svees alleging several code
violations for their low-cost repairs of their roof to comply with their insurance policy.
Svee, ¶¶ 2–4. The Svees ultimately prevailed in the civil suit, but the district court denied
their request for attorney fees. Svee, ¶ 6. We reversed the denial of attorney fees, in part
based on our conclusion that the parties were “clearly not similarly situated or on equal
footing”:
32
The Svees sought to accomplish a low-cost repair of their roof in response to
a notice from their insurance company about cancellation of their coverage.
By so doing, they were named as defendants in both criminal and civil actions
filed by the municipal government, in comparison to whom they had
significantly less resources to litigate the alleged violation of the ordinance.
Svee, ¶ 21. In contrast, in Hughes, ¶ 19, we concluded that the parties were similarly
situated as they had both “operated neighboring ranches for at least fifty years” and
“dealt with each other over the years, more amicably at times, on relatively equal footing.”
We found nothing in the record to “indicate[] that Hughes acted in bad faith in bringing the
declaratory judgment action”: Hughes reasonably believed that he had a legal right to use
the disputed roadway because he had used it without challenge for decades. Hughes, ¶ 20.
¶60 The record does not support the District Court’s conclusion that the parties were on
unequal footing. The DMLOA presented insufficient evidence to establish that JRN has
significantly greater resources to pursue litigation—its evidence showed only that John
Sechena and Ruth Sechena are both “successful private physicians who work[ed] and
reside in Seattle, Washington. They also own and operate a vacation lodge on the Dearborn
Meadows’ property that charges $275/night, with a four-night minimum.” Especially
considering that there are several hundred members of the DMLOA who would stand to
benefit from this action, this is insufficient information to lead to any inference about the
parties’ relative abilities to financially support a lawsuit.
¶61 The record also does not support the District Court’s apparent conclusion that JRN
acted in bad faith. It is evident in the record that JRN pursued this lawsuit with the intention
of lawfully and peacefully resolving the parties’ dispute. Indeed, the District Court
specifically noted in its judgment the contention and violence that often accompanies the
33
protection of property rights in Montana, and JRN’s course of conduct reflects its attempt
to avoid such a circumstance. JRN provided notice of the gate to all landowners involved
and followed through with its plan to erect and lock the gate in incremental steps to avoid
any “violence” or “intimidation.” Neither any landowners nor the DMLOA objected to
JRN’s gate at the time it was erected, only pursuing their concerns several years later. And
JRN’s suit followed only when the gate was destroyed several times and the DMLOA
threatened to remove it again at JRN’s expense. Both parties had good faith and genuine
beliefs supporting their claims, and the record does not support the DMLOA’s contention
that JRN “intend[ed] to exploit [the parties’] disparate financial situations.” See
Ethen Revocable Tr. v. River Res. Outfitters, LLC, 2011 MT 143, ¶ 57, 361 Mont. 57,
256 P.3d 913 (noting that the equities did not support an award of attorney fees where both
parties genuinely believed they owned the disputed property). Instead, the record
demonstrates that, right or wrong, JRN had a genuine belief that no easements existed
across its property beyond the power company’s easement and that by erecting the gate
JRN was attempting to respond to the general public’s use and vandalism of its property
and the Road. Hughes, ¶ 20.
¶62 Although the DMLOA has incurred substantial legal fees drawing on its limited
operating funds, the record shows that it reasonably believed it was in its members’ best
interests to pursue through its counterclaim a judicial determination affirming the rights of
its members to use the Road in order to discourage other landowners from gating other
roads in the Dearborn Meadows area. We thus conclude that the District Court abused its
discretion when it determined that the equities support an award of attorney fees to the
34
DMLOA. We need not address JRN’s additional arguments regarding the District Court’s
order for the DMLOA to file a petition for attorney fees, the timeliness of the DMLOA’s
motion, the District Court’s application of the tangible parameters test, or the
District Court’s findings regarding the reasonableness of the fees awarded. See Hughes,
¶ 21 (citing United Nat’l Ins., ¶ 38); Mungas, ¶ 46 (where this Court declined to apply the
tangible parameters test due to the absence of equitable considerations to support the
District Court’s award of attorney fees).
CONCLUSION
¶63 We affirm the District Court’s declaration of an implied easement by preexisting
use for residential use of the Dearborn Meadows properties that have no other means of
access to reach their land. We reverse the District Court’s determination that the implied
easement extends to other DMLOA members, but we affirm its decision that all DMLOA
members hold a prescriptive easement for both residential and recreational uses. We
reverse the District Court’s ruling that either an implied easement or a prescriptive
easement exists for use by the public. We additionally reverse the District Court’s award
of attorney fees to the DMLOA.
¶64 The case is remanded for entry of judgment consistent with this Opinion.
/S/ BETH BAKER
We Concur:
/S/ MIKE McGRATH
/S/ JAMES JEREMIAH SHEA
/S/ LAURIE McKINNON
/S/ DIRK M. SANDEFUR
35