Ashland Pipeline Co. v. Indiana Bell Telephone Co., Inc.

• Decision Date: 24 March 1987
• Docket Number: No. 87A01-8609-CV-241,87A01-8609-CV-241
• Citation: 505 N.E.2d 483
• Parties: ASHLAND PIPELINE CO., Defendant-Appellant, v. INDIANA BELL TELEPHONE COMPANY, INC., Plaintiff-Appellee.
• Court: Indiana Appellate Court

Page 483

505 N.E.2d 483

ASHLAND PIPELINE CO., Defendant-Appellant, v. INDIANA BELL TELEPHONE COMPANY, INC., Plaintiff-Appellee.

No. 87A01-8609-CV-241.

Court of Appeals of Indiana,

First District.

March 24, 1987.

Rehearing Denied May 6, 1987.

Robert F. Wagner, N. Kathleen Wenzel, Lewis, Bowman, St. Clair & Wagner, Indianapolis, for defendant-appellant.

F. Wesley Bowers, David E. Gray, Bowers, Harrison, Kent & Miller, Evansville, for plaintiff-appellee.

NEAL, Judge.

STATEMENT OF THE CASE

Defendant-appellant, Ashland Pipeline Co. (Ashland), appeals a judgment of the Warrick Circuit Court, sitting without a jury, in favor of plaintiff-appellee, Indiana Bell Telephone Company, Inc. (Indiana Bell). The judgment, in the amount of $2,762.50, resulted from the severance of Indiana Bell's underground cable by Ashland.

We affirm.

STATEMENT OF THE FACTS

The facts most favorable to support the judgment are as follows. Through a succession of assignments, Ashland became the owner of an easement located upon certain private property near the intersection of Indiana Highways 61 and 62 in Warrick County, Indiana. Ashland's easement, originally acquired and duly recorded in 1921, runs generally in a north-south direction. At some time during the 1920's, Ashland laid an underground pipeline along its easement. In 1974, Indiana Bell acquired and recorded an easement in the same area, but its easement runs generally in an east-west direction. In 1975, Indiana Bell laid an underground telephone cable along its easement. The telephone cable On March 7, 1979, Ashland performed a maintenance project on its pipeline and, during excavation, severed Indiana Bell's telephone cable where it crossed the pipeline. Over three hours of telephone service was lost before Indiana Bell completed splicing the cable together.

crossed over Ashland's pipeline at a point approximately 160 feet west of Indiana Highway 61.

Indiana Bell filed its complaint on March 2, 1981, seeking damages of $2,762.50, and alleging negligence and trespass by Ashland. In its answer Ashland denied that it was negligent and averred that Indiana Bell was contributorily negligent in that Indiana Bell had failed to notify Ashland that the telephone cable crossed the pipeline.

A bench trial was held on October 17, 1985. The evidence disclosed that, although Indiana Bell's record of the 1975 work order regarding the underground cable provided for a warning sign at the point where the cable crossed the pipeline, the only warning signs in the area at the time Ashland severed the cable were approximately 600 feet east and 500 feet west of the site in question. An Indiana Bell employee testified as to the procedures followed in receiving and responding to requests for underground cable locations, and there was evidence that Ashland had requested such information on March 7, 1979. Other testimony related that Indiana Bell was aware of the pipeline when it laid the cable, but did not know that Ashland was the owner. Although the cable was severed within a few feet of both a vent pipe and an aerial marker pertaining to the pipeline, the evidence was conflicting whether they were in place when Indiana Bell laid the cable.

Ashland's evidence related that it relies on those who acquire easements subsequent to its own to notify it so that potential problems may be avoided. An Ashland employee testified that it is Ashland's policy to determine and notify any and all concurrent easement holders before installing new pipelines, but when maintaining an existing pipeline, as is involved here, Ashland assumes any concurrent easement holder has notified Ashland of its presence. An Ashland supervisor testified that the March 7 maintenance project was not an emergency situation, but had in fact been planned one to two months before. He further testified that Ashland did not research the county recorder's documents to determine the presence of any concurrent easements; instead, the Ashland work crew conducted an on-site visual inspection. Having noticed telephone lines strung on poles overhead, and not encountering any signs warning of cables underground, the work crew assumed there were none and excavated, whereupon the underground cable was severed.

The trial court entered its ruling and judgment on October 21, 1985. The trial court found that both easements had been duly recorded, but neither Ashland's nor Indiana Bell's easement was exclusive. The trial court also found that, while Ashland was lawfully upon its own easement making necessary pipeline repairs, Indiana Bell's recorded easement was sufficient notice to impose a duty on Ashland to exercise reasonable care. Ashland having breached that duty by not locating the underground cable prior to the excavation, the trial court entered judgment in favor of Indiana Bell in the amount of $2,762.50. From that judgment Ashland instituted this appeal.

ISSUES

Ashland presents the following issues for our review, maintaining that the trial court erred in:

I. Ruling that Indiana Bell's easement, acquired and recorded subsequent to Ashland's easement, was sufficient notice to impose a duty on Ashland to exercise reasonable care;

II. Concluding that Ashland was negligent under the circumstances;

III. Concluding that Indiana Bell was not contributorily negligent under the circumstances; and

IV. Relying upon an improper measure of damages, resulting in an award

of excessive damages to Indiana Bell.

DISCUSSION AND DECISION

ISSUE I: Imposition of Duty

Ashland claims the trial court erred in concluding that Indiana Bell's recorded easement was sufficient notice to impose a duty on Ashland to exercise reasonable care. The basis for this claim is Ashland's assertion that recordation of an easement is designed to give notice to a subsequent grantee, not a prior grantee such as Ashland.

The law recognizes two kinds of notice. Constructive notice is a legal inference from established facts, while actual notice is that directly and personally given to the person to be notified. Wienke v. Lynch (1980), Ind.App., 407 N.E.2d 280. Actual notice, in turn, is divided into two classes: express, which is direct communication; and implied, which is inferred from the fact that the person charged had means of knowledge which he did not use. Altman v. Circle City Glass Corp. (1985), Ind.App., 484 N.E.2d 1296, trans. denied. Whatever fairly puts a person on inquiry is sufficient notice, where the means of knowledge are at hand; and if he omits to inquire, he is then chargeable with all the facts which, by a proper inquiry, he might have ascertained. Id. (quoting Mishawaka St. Joseph Loan and Trust Co. v. Neu (1935), 209 Ind. 433, 196 N.E. 85).

Ashland correctly states that recording acts impart constructive notice only to those who claim through or under the grantor in question, and not prior grantees. Piel v. DeWitt (1976), 170 Ind.App. 63, 351 N.E.2d 48. IND.CODE 32-1-2-16 provides that every conveyance of an interest in land shall be recorded, and shall take priority according to the time of its filing, and any conveyance shall be void as against a subsequent conveyance to a bona fide purchaser who has first recorded his instrument. The purpose of the statute is to give constructive notice to subsequent purchasers/transferees of the prior purchasers/transferor's interest in the real estate; the subsequent purchaser/transferee is bound by the recording, whether or not he has actual notice. In addition, the recorded instrument is only notice, whether actual or constructive, of the existence and record of such instrument, and of the contents, not of the instrument itself, but only of such record. Lowry v. Smith (1884), 97 Ind. 466. In short, recording involves matters of title.

The trial court found both Ashland and Indiana Bell possess non-exclusive easements which are duly recorded. This court has held that each concurrent easement owner has the right to make reasonable repairs, alterations, and improvements to the easement so long as such do not injuriously affect his co-owner. Litzelswope v. Mitchell (1983), Ind.App., 451 N.E.2d 366. This duty exists even though the co-owners did not acquire their easements contemporaneously. See id. Ashland cites no authority for the proposition that, as a grantee of a non-exclusive easement, it was entitled to be notified of all subsequent grantees of similar easements over the same property. As a general rule, a landowner who has granted an easement in his land may grant subsequent easements in the same land, so long as the subsequent easements are neither inconsistent with nor a burden upon the prior easement. Moseley v. Bishop (1984), Ind.App., 470 N.E.2d 773.

The instant case involves a question of negligence; it does not involve a matter of title. Both easements being general and non-exclusive, it is of no consequence that Ashland's easement was recorded prior to Indiana Bell's. Therefore, the trial court did not err in imposing a duty upon Ashland to exercise reasonable care in both ascertaining the identity and locating the interests of any concurrent easement owners, such as Indiana Bell.

ISSUE II: Negligence of Ashland

Ashland argues that, absent knowledge or notice of Indiana Bell's status as a concurrent easement owner, any acts or omissions by Ashland could not constitute negligence. Having determined that the trial court did not err in imposing a duty upon Ashland to exercise reasonable care, it remains to be resolved whether Ashland breached that duty.

Ashland correctly cites Hunsberger v. Wyman (1966), 247 Ind. 369, 373, 216 N.E.2d 345, 348, for the proposition that "[i]n order for an act or an omission to constitute negligence, a person to be charged must have knowledge or notice that such act or omission involved danger to another." However, in Hunsberger our supreme court went on to state that "[t]he foundation of liability is knowledge, or what is deemed in law to be the same thing,...