Akg Real Estate, LLC v. Kosterman

• Decision Date: 14 July 2006
• Docket Number: No. 2004AP188.,2004AP188.
• Citation: 2006 WI 106,717 N.W.2d 835
• Parties: AKG REAL ESTATE, LLC, a limited liability company, Plaintiff-Appellant-Cross-Respondent, v. Patrick J. KOSTERMAN and Susan A. Kosterman, Defendants-Respondents-Cross-Appellants-Petitioners.
• Court: Wisconsin Supreme Court

717 N.W.2d 835

2006 WI 106

AKG REAL ESTATE, LLC, a limited liability company, Plaintiff-Appellant-Cross-Respondent, v. Patrick J. KOSTERMAN and Susan A. Kosterman, Defendants-Respondents-Cross-Appellants-Petitioners.

No. 2004AP188.

Supreme Court of Wisconsin.

Argued November 15, 2005.

Decided July 14, 2006.

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For the defendants-respondents-cross-appellants-petitioners there were briefs by Daniel Kelly, J. Bushnell Nielsen and Reinhart Boerner Van Deuren S.C., Milwaukee, and oral argument by Daniel Kelly.

For the plaintiff-appellant-cross-respondent there was a brief by Robert E. Hankel and Hankel, Bjelajac, Kallenbach, Lehner & Koenen, L.L.C., Racine, and oral argument by Robert E. Hankel.

An amicus curiae brief was filed by M. Elizabeth Winters, Daniel W. Hildebrand, and DeWitt Ross & Stevens, S.C., Madison, on behalf of the Village of Merrimac.

¶ 1 DAVID T. PROSSER, J

This case presents the question whether an express easement may be relocated or terminated without the consent of the dominant estate. In a published decision,¹ the court of appeals held that a servient estate could unilaterally terminate an express right-of-way easement once the servient estate provided an alternate route of ingress and egress to the dominant estate. We reverse the court of appeals because we conclude that the owner of a servient estate cannot unilaterally relocate or terminate an express easement.

I

¶ 2 We begin this case about easements by reviewing several key terms. An easement (or servitude) is an interest that encumbers the land of another. McCormick v. Schubring, 2003 WI 149, ¶ 8, 267 Wis.2d 141, 672 N.W.2d 63 (citing Ludke v. Egan, 87 Wis.2d 221, 227, 274 N.W.2d 641 (1979)). It is a liberty, privilege, or advantage in lands, without profit, and existing distinct from the ownership of the land. Id.; Schwab v. Timmons, 224 Wis.2d 27, 35-36, 589 N.W.2d 1 (1999); Stoesser v. Shore Drive P'ship, 172 Wis.2d 660, 667, 494 N.W.2d 204 (1993).

¶ 3 An easement creates two distinct property interests—the dominant estate, which enjoys the privileges as to other land granted by an easement, and the servient estate, which permits the exercise of those privileges. Schwab, 224 Wis.2d at 36, 589 N.W.2d 1.

¶ 4 In the spring of 2000, Patrick and Susan Kosterman (the Kostermans) purchased a house on a four-acre lot from Edward and Audrey Chvilicek (the Chviliceks). The Kostermans' property (the Dominant Estate) lacked access to a public road except by means of three recorded, physically overlapping easements across part of an 80-acre parcel of land (the Servient Estate), which partially surrounded their property.

¶ 5 Nearly 50 years ago the Dominant Estate and the Servient Estate were under common ownership. Some time prior to 1960, Louis and Angeline Chvilicek bought approximately 84 acres of vacant land along Highway 31 in Racine County. In August of 1960 Louis and Angeline deeded the four-acre Dominant Estate to their son and daughter-in-law, the Chviliceks, and granted the Dominant Estate a 30-foot-wide easement over the 80-acre Servient Estate, because the Dominant Estate lacked access to a public road.

¶ 6 In 1961 Louis and Angeline granted the Chviliceks a second right-of-way easement along the same course as the 1960 easement. This second easement was 66 feet wide. By increasing the width of the easement, Louis and Angeline made it possible for the easement to be converted into a public road.

¶ 7 When Louis Chvilicek died, Angeline conveyed to the Chviliceks, as tenants-in-common, a 50 percent interest in the Servient Estate. Angeline conveyed the other 50 percent interest in the property to her daughter and son-in-law, Joyce and Vincent White. When Joyce and Vincent died, their interest in the Servient Estate transferred into the Vincent J. White Trust (the Trust).

¶ 8 In 1997 AKG Real Estate, LLC (AKG) offered to purchase the Servient Estate from the Chviliceks and the Trust, with the intention of developing a subdivision. AKG purchased the entire Servient Estate from the Chviliceks and the Trust in January 1998 by warranty deed and trustee's deed. The 1998 deeds expressly recognized a 30-foot-wide private road easement on the same location as the 1960 and 1961 easements:

Reserving therefrom a private road easement for the benefit of Edward T. Chvilicek and Audrey M. Chvilicek, husband and wife, their heirs and assigns, or subsequent owners . . . until such time as public road access is made available for said real estate upon the following described easement of right of way. . . .

In addition, the two deeds reserved to the grantors (including the Chviliceks) all "recorded and/or existing easements and right of way reservations[.]"

¶ 9 While AKG was planning to develop the land, the Chviliceks sold the Dominant Estate to the Kostermans in 2000. Initially, AKG's development plan depicted two public roads connecting with Highway 31 from the planned subdivision. The first was along the path of the Kostermans' easements and the second, to the north, was at what is presently Cobblestone Drive.² After meeting with Racine County officials, however, AKG realized that the Wisconsin Department of Transportation (DOT) was unlikely to approve a public road along the Kostermans' easements because Wis. Admin. Code § Trans 233.06 (Jan., 2004)³ requires a minimum distance of 1000 feet between roads that connect to state highways. If a public road affording access to Highway 31 were constructed over the Kostermans' easements, the road would have been within 600 feet of Valley Road to the south, and within 300 feet of Cobblestone Drive to the north.

¶ 10 After determining DOT would not consent to a public road located along the Kostermans' easements, AKG altered its subdivision plans and proposed to give the Kostermans access to Highway 31 via a cul-de-sac, which would connect with Cobblestone Drive, which in turn would connect with Highway 31. Under this plan, AKG would develop about seven lots over the Kostermans' easements and the Kostermans would be required to reconfigure their driveway so that it connected with AKG's proposed cul-de-sac. Before AKG could get the necessary governmental approval for its subdivision plat, however, the Kostermans needed to release their easement rights to AKG, or agree to move the location of the easements. To date, the Kostermans have refused to modify their right-of-way easements to accommodate AKG's development plans.

¶ 11 The Kostermans objected to relocating the easements for several reasons in addition to requiring them to reconfigure their driveway. AKG's development plan would put the Kostermans' house in an odd position relative to the cul-de-sac and the neighboring houses, require them to change their street address, and replace their direct access to Highway 31 with a circuitous route. Consequently, AKG again modified its plans to develop the subdivision. The modified plan calls for development to occur in two phases, the second of which awaits the denouement of this litigation.

¶ 12 In response to the Kostermans' unwillingness to relocate or terminate their easements, AKG sought a declaratory judgment that the easements terminated once AKG provided alternate public road access to the Dominant Estate. The Kostermans counterclaimed for a declaratory judgment that the 1960 and 1961 easements would remain in effect even if AKG provided an alternate means of ingress and egress to the Dominant Estate. The Kostermans moved for summary judgment. On summary judgment, the Racine County Circuit Court, Charles H. Constantine, Judge, ruled that the 1998 easement would terminate once AKG provided public road access, regardless of the location, but the 1961 easement of 66 feet would remain in effect even after AKG provided the Dominant Estate with alternate public road access. Both parties appealed.

¶ 13 The court of appeals affirmed the circuit court's holding that the 1998 easement terminated once AKG provided public road access, but it reversed the circuit court's holding that the 1961 easement would continue. Kosterman, 277 Wis.2d 509, ¶ 55, 691 N.W.2d 711. First, the court of appeals concluded the 1998 easement was unambiguous and that it terminated once AKG afforded the Dominant Estate public road access regardless of the location. Kosterman, 277 Wis.2d 509, ¶¶ 37-39, 691 N.W.2d 711. Second, the court of appeals held that both the 1961 and the 1998 easements should be modified under the doctrine of changed conditions to avoid a "grossly inefficient allocation of resources." Id., ¶¶ 40, 53, 691 N.W.2d 711. Central to the court of appeals conclusion was its assessment that "the miniscule benefits the Kostermans derive impose aggregate costs far in excess of the sum total of benefits to all concerned parties." Id., ¶ 52, 691 N.W.2d 711. Accordingly, the court of appeals modified the easement created by the 1960 deed as well as the 1961 easement so that both easements would terminate once the Dominant Estate received alternate public road access. Id., ¶ 53, 691 N.W.2d 711. The Kostermans petitioned for review.

II

¶ 14 This case comes to us on summary judgment. We review a circuit court's grant or denial of summary judgment independently of the circuit court or court of appeals, applying the same methodology as the circuit court. O'Neill v. Reemer, 2003 WI 13, ¶ 8, 259 Wis.2d 544, 657 N.W.2d 403. Summary judgment is appropriate if there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. Wis. Stat. § 802.08(2). Resolution of this case requires interpretation of the documents creating the 1961 and 1998 easements. Here, both the circuit court and the court of appeals decided the 1961 and 1998 easements were unambiguous. See Kosterman, 277 Wis.2d 509, ¶¶ 36, 43, 691 N.W.2d 711. Whether a deed or other instrument is ambiguous is a question of law we review independently. See Gojmerac v....