C & G, INC. v. Rule

• Decision Date: 02 May 2001
• Docket Number: No. 25600.,25600.
• Citation: 135 Idaho 763,25 P.3d 76
• Court: Idaho Supreme Court
• Parties: C & G, INC., and Martin C. Galvin, Plaintiffs-Appellants-Cross Respondents, v. Daniel P. RULE and Marjorie N. Rule, Husband and Wife, Defendants-Respondents, and Union Pacific Railroad Company, a Utah Corporation, Defendant-Respondent-Cross Appellant.

25 P.3d 76

135 Idaho 763

C & G, INC., and Martin C. Galvin, Plaintiffs-Appellants-Cross Respondents, v. Daniel P. RULE and Marjorie N. Rule, Husband and Wife, Defendants-Respondents, and Union Pacific Railroad Company, a Utah Corporation, Defendant-Respondent-Cross Appellant.

No. 25600.

Supreme Court of Idaho. Boise, December 2000 Term.

May 2, 2001.

Rehearing Denied June 18, 2001.

Matt J. Howard, Boise, argued for appellants.

Hawley, Troxell, Ennis & Hawley, Boise; and Eismann Law Offices, Nampa, for respondents Rules. Stephen C. Hardesty argued.

Jim Jones & Associates, Boise, for respondent Union Pacific Railroad. Jim Jones argued.

WALTERS, Justice.

This is an appeal from the district court's summary judgment quieting title to two parcels of land in Respondents Union Pacific Railroad and Daniel and Marjorie Rule. We affirm.

FACTUAL AND PROCEDURAL HISTORY

On November 27, 1899, George Thomas, who was the great uncle of appellant Martin Galvin, conveyed a parcel of real property near Middleton, Idaho to the Idaho Northern Railway Company. The original of the deed, containing a cover sheet entitled "Right of Way Deed," was recorded with the Canyon County Recorder on May 9, 1901.

Later, on January 30, 1900, S.F. Chaney, who was Galvin's great grandfather, also conveyed a nearby parcel of property to Idaho Northern. Like the Thomas deed, the Chaney deed also contains the caption "Right of Way Deed" on the cover sheet. This deed was recorded with the Canyon County Recorder on April 7, 1902.

Galvin and his family inherited the farms owned by Thomas and Chaney and have farmed the land (not including the parcels conveyed to the railroad) through their small corporation, C & G, Inc., since the 1940's. Union Pacific Railroad is the successor and assignee of Idaho Northern as to both of these conveyed parcels. Union Pacific maintained rail operations across the parcels until 1996, when it abandoned the railroad line. Galvin and C & G Inc. made some attempt to purchase the properties, but on December 3, 1997, Union Pacific quitclaimed the strips of land to the respondents, Daniel and Marjorie Rule. On February 17, 1998, Galvin and C & G, Inc. brought an action against Union Pacific and the Rules to quiet title to each of the parcels. The plaintiffs alleged that Galvin's predecessors had only granted Idaho Northern an easement rather than a fee simple title in the properties. Each of the parties moved for summary judgment. After oral argument and briefing, the district court issued a memorandum opinion and order denying the motions on the basis that material questions of fact existed. The district court, upon reconsideration, however, held that the Chaney and Thomas deeds, although ambiguous, nonetheless conveyed fee simple title to Idaho Northern. The court subsequently granted summary judgment in favor of Union Pacific and the Rules. Union Pacific later submitted a request for attorney fees, which the district court denied. Galvin and C & G, Inc. appeal the district court's ruling that their predecessors conveyed a fee simple title in the properties. In addition, Union Pacific appeals the district court's denial of its request for an award of attorney fees.

DISCUSSION

A. Construction of the Deeds

1. Standard of Review

Our standard of review of a lower court's interpretation of an instrument depends on whether the instrument is ambiguous. See DeLancey v. DeLancey, 110 Idaho 63, 65, 714 P.2d 32, 34 (1986). The question of whether an instrument is ambiguous is a question of law, over which we exercise free review. See id. In the absence of ambiguity, the document must be construed in its plain, ordinary and proper sense, according to the meaning derived from the plain wording of the instrument. See Juker v. American Livestock Ins. Co., 102 Idaho 644, 645, 637 P.2d 792, 793 (1981). Interpretation of an ambiguous document presents a question of fact, and we will defer to the findings of the trial court so long as those findings are supported by substantial and competent evidence. See DeLancey, 110 Idaho at 65, 714 P.2d at 34; Staggie v. Idaho Falls Consol. Hosps., Inc., 110 Idaho 349, 351, 715 P.2d 1019, 1021 (Ct.App.1986). Interpretation of an unambiguous document, on the other hand, is a question of law and, therefore, a matter of free review. See DeLancey, 110 Idaho at 65, 714 P.2d at 34.

2. The Chaney and Thomas Deeds

The granting and habendum clauses of the Thomas deed state that Thomas in exchange for consideration:

[D]oes grant, sell and convey unto the said Idaho Northern Railway Company, Limited, the following described piece, parcel of land, to wit: A strip, piece or parcel of land one hundred feet in width, situated in the North West quarter (NW¼) of Section seventeen (17) ...

...

To Have and to Hold, the said above described premises unto the said Idaho Northern Railway Company, Limited, its successors and assigns forever.

The granting and habendum language in the Chaney deed is similar to that in the Thomas deed. It recites:

[S.F. Chaney] does grant, sell and convey unto the said Idaho Northern Railway Company, Limited, the following described piece, parcel of land one hundred feet in width, situated in the West one half (W½) of the Northeast quarter (NE¼)

...

To have and to hold, the said above described premises unto the said Idaho Northern Railway Company, Limited, its successors and assigns forever.

However, as mentioned above, both the Thomas and Chaney deeds also contain the caption "Right of Way" on their cover sheets. Thus, the question before the Court is whether this reference to a "right of way" in the cover sheets for the deeds creates an ambiguity by implying that Thomas and Chaney intended to convey easements rather than fee simple title in the properties. If the deeds convey a fee simple interest in the property, the railroad is free to sell the land to the Rules; if, however, the deeds conveyed only an easement, then when Union Pacific abandoned its rail line the land would return to the control of Galvin, the alleged fee owner. The district court, although granting summary judgment in favor of the Rules, concluded that the deeds in this case were ambiguous. We disagree with this conclusion, but nevertheless uphold the district court's grant of summary judgment. Foremost Ins. Co. v. Putzier, 102 Idaho 138, 144, 627 P.2d 317, 323 (1981). We are convinced that the deeds in this case, despite the presence of the "Right of Way" caption on the cover sheets, unambiguously conveyed a fee simple interest in the properties to the railroad.

Galvin argues initially that the language of the deeds must be construed against the railroad as the drafter of the deeds. The district court concluded, and we agree, that Idaho Northern was the likely drafter of both the Thomas and Chaney deeds.¹ Nevertheless, we believe that Galvin's argument is misplaced. Although it is true that courts have generally construed deeds against the grantor and in favor of the grantee, they have typically done so only to resolve an ambiguity in the deed. See Wilson v. Brown, 320 Ark. 240, 244, 897 S.W.2d 546, 548 (1995) ("The intent of the grantor should be garnered solely from the language of the deed unless the language is ambiguous uncertain, or doubtful. If the language of the deed is ambiguous or doubtful, it should be construed against the party who prepared it."); Clark v. CSX Transp., Inc., 737 N.E.2d 752, 759 (Ind.Ct.App.2000) ("Where a deed is ambiguous as to the character of the interest conveyed and the railroad was responsible for the form of the deed, we will construe the language of the deed in favor of the grantor and against the railroad.") (citing Hefty v. All Other Members of the Certified Settlement Class, 680 N.E.2d 843, 855 (Ind.1997)); Messner v. Moorehead, 787 P.2d 1270, 1272 (Okla.1990) ("In construing a conveyance, or alleged uncertainties in a deed ... [the] deed will be construed most strongly against the grantor, or the one drawing the deed, and in favor of the grantee"); Rath v. Haycock, 137 Or.App. 456, 462-63, 905 P.2d 854, 857 (1995) (finding little evidence of the parties' intent and therefore resorting to the "rule of construction that `[w]hen there is an ambiguity in a deed, the general rule is to construe it against the grantor'") (quoting Verzeano v. Carpenter, 108 Or.App. 258, 815 P.2d 1275 (1991)). As discussed below, however, we believe that there is no ambiguity present in either the Thomas or the Chaney deeds. Accordingly, we consider the language of the deeds without resort to any rule of construction.

In interpreting a deed of conveyance, the primary goal is to seek and give effect to the real intention of the parties. See Gardner v. Fliegel, 92 Idaho 767, 770, 450 P.2d 990, 993 (1969); Bumgarner v. Bumgarner, 124 Idaho 629, 637, 862 P.2d 321, 329 (Ct.App.1993). Where a deed is ambiguous, interpretation of the grantor's intent is a question of fact determined from the instrument itself, as well as from the surrounding facts and circumstances. See Latham v. Garner, 105 Idaho 854, 857, 673 P.2d 1048, 1051 (1983); Dille v. Doerr Dist. Co., 125 Idaho 123, 125, 867 P.2d 997, 999 (Ct.App.1993). Where a deed is unambiguous, however, the parties' intent must be ascertained from the language of the deed as a matter of law without resort to extrinsic evidence. See id.; see also Gardner, 92 Idaho at 770, 450 P.2d at 993 (stating that if the language of a deed is plain and unambiguous the intention of the parties must be ascertained from the deed, and parol evidence, that is, documentary, oral or real evidence extrinsic to the deed itself, is not admissible to ascertain intent); Hines v. Hines, 129 Idaho 847, 854, 934 P.2d 20, 27 (1997) (noting that "there is no need to resort to extrinsic evidence to interpret or modify the terms of what appears to be a clearly written document").

In deciding whether a document is ambiguous, the Court seeks to determine whether it is ...