Consolidated Freight Lines, Inc. v. Groenen

• Citation: 10 Wn.2d 672,117 P.2d 966
• Decision Date: 17 October 1941
• Docket Number: 28043.
• Parties: CONSOLIDATED FREIGHT LINES, Inc., v. GROENEN et al.
• Court: United States State Supreme Court of Washington

117 P.2d 966

10 Wn.2d 672

CONSOLIDATED FREIGHT LINES, Inc., v. GROENEN et al.

No. 28043.

Supreme Court of Washington, En Banc.

October 17, 1941

Action to quiet title by Consolidated Freight Lines, Inc., against Henry Groenen and Mrs. Henry Groenen, his wife, and others. From the judgment, the named defendants appeal.

Reversed with direction.

Appeal from Superior Court, Spokane County; R. M Webster, judge.

E. A Cornelius, of Spokane, for appellants.

James A. Brown, Carl C. Quackenbush, and Harvey Erickson, all of Spokane, for respondent Spokane County.

DRIVER Justice.

In 1935, the Consolidated Freight Lines, Inc., acquired, as a freight depot site, lots 7 to 11, inclusive, in the south half of block 9 of Nosler's Addition to the City of Spokane. Lots 9, 10, and 11 were purchased from Spokane county. All the lots were unimproved, and, so far as a visual ground inspection would disclose, appeared to be full-sized but 10 and 11 were, in fact, fractional in the sense that they did not extend all the way from the south line of the block to the graded east-west alley running through the center. This was due to the interposition of a small unplatted tract, a portion of what had formerly been a shallow lake or tule bed, which had passed to Spokane county many years Before by the foreclosure of a tax lien. In the pleadings and in the testimony at the trial in the instant case, this tract was called the Hawkeye lake parcel. It will be designated by that name throughout this opinion also.

A map of Nosler's addition in a plat book in the county auditor's office showed the location of Hawkeye lake. At the time it purchased the lots, the freight company procured a policy of title insurance, and, on a map attached thereto, the position of the Hawkeye lake parcel was indicated and the common boundary line between it and lots 10 and 11 was delineated.

In the early part of 1935, the company built a one-story concrete and brick freight depot at a cost of about $55,000, and, under the erroneous assumption that its lots were full sized, so placed the building that approximately nine percent of its area encroached upon the Hawkeye lake parcel.

In 1939, the land agent of Spokane county received a request to put the parcel up for sale. An investigation revealed that it was covered by a portion of the freight company's depot, and the county commissioners promptly notified the company of that fact. The parcel was then advertised for sale in accordance with the statutory requirements, and, on the appointed day, was sold at public auction to Henry Groenen, the highest bidder, for $1,000. The company's attorney attended the sale and offered a bid of $600. Shortly thereafter, the freight company, as plaintiff, brought the present action to quiet title to the Hawkeye lake parcel, naming as defendants the purchaser and his wife, Spokane county, and the city of Spokane. The defendants Groenen answered, denying that the plaintiff owned either the parcel or the improvements thereon, and affirmatively asserted their own title based upon their purchase at the county's sale. The county and the city disclaimed any interest in the property.

After a trial without a jury, the court found that Groenen and wife were the owners of the land, and that the freight company was entitled to the improvements thereon. Judgment was entered granting plaintiff relief in accordance with the provisions of the betterment statute, Laws of 1903, chapter 137, p. 262, Rem.Rev.Stat. § 797 et seq. The defendants Groenen appealed.

For convenience, we shall refer to Henry Groenen as if he were the only appellant and to the Consolidated Freight Lines, Inc., as if it were the only respondent.

The oral memorandum opinion of the trial court discloses that its judgment was based upon two separate grounds: (1) That Spokane county and, hence, appellant, its grantee, were estopped to claim title to the improvements upon the Hawkeye lake parcel; and (2) that the respondent was entitled to invoke the betterment statute above cited. The appellant's assignments of error, in effect, challenge the soundness of both these grounds of decision, and we shall discuss them in the order stated. Before doing so, however, we think it may clarify the issues to consider a phase of the case which respondent has heavily stressed in its brief and that seems also to have profoundly impressed the trial court, namely, the motive which induced the appellant to purchase the real property in controversy. In its memorandum opinion, the court said: 'Now, in some way Mr. Groenen got information that that was the true situation, because there is no evidence to show that he had any other object in buying it than to speculate at the expense of the consolidated company. He and those that operated with him, or had to do with the matter, knew that this building was there. They knew it was an expensive building. They knew it would be a tremendous inconvenience and loss to this company to be deprived of it, and they felt that by getting title to the land they could then hold up the company for a good stiff price by way of compromise or settlement.'

However reprehensible the appellant's actuating purpose may have been from a moral standpoint, we fail to see how it has any material bearing on the issues in this case. Ordinarily, in the absence of fraud, the courts are not concerned with the motive which impels a person to make a lawful purchase of property. Here, the appellant's purchase was neither fraudulent nor unlawful. It was not made surreptitiously, but openly at the county's public auction of lands acquired for delinquent taxes, which sale was held pursuant to statutory mandate. The sale was consummated after free competitive bidding in which the respondent participated.

The respondent, in its brief, quotes from the opinion in Edwards v. Allouez Mining Co., 38 Mich. 46, 31 Am.Rep. 301, to the effect that, when a person comes into a court of equity demanding more than the strict rules of law can give him, the court may scrutinize his motive in order to ascertain how he came to be placed in such a situation. In that case, a man purchased a tract of land on which a mining company, by the operation of a stamp mill, had caused sand to be deposited, and then brought suit to enjoin it from continuing such operation. The court denied injunctive relief and commented on the plaintiff's motive in making the purchase. But the complainant did not claim that the mining company was insolvent, and the court concluded that, under the circumstances, 'The elements of irreparable injury are entirely wanting to his [complainant's] case.' The quoted statement is not apt, and the case in which it was made is factually distinguishable. Here, the appellant was not seeking injunctive or other equitable relief in the lower court. He was the defending, rather than the moving, party; and even his defense was a legal one, namely, that he had legal title to the real property in dispute by virtue of his purchase and deed from the county. In this case, we think, the record facts should be viewed objectively and the appellant's intent or motive should not be considered.

The first, or estoppel, ground of decision of the trial court has two aspects. The first is that Spokane county and its successor, the appellant, are estopped to claim the improvements on the Hawkeye lake parcel, because the county stood by and permitted them to be made without offering any protest.

The principle of estoppel by silence or implied acquiescence was recognized by this court in Harms v. O'Connell Lumber Co., 181 Wash. 696, 44 P.2d 785. There, a lumber company had purchased standing timber on terms which allowed a reasonable time in which to cut and remove it. We held that the owner of the land, who had permitted the company to expend a large sum to build a spur track for use in logging off the timber, was estopped to assert that the right to remove it had been lost by lapse of time. In that case, however, it should be noted that the land owner had actual knowledge that the lumber company was building the spur track for the purpose of removing the timber.

Estoppel by silence does not arise without full knowledge of the facts and a duty to speak on the part of the person against whom it is claimed. Blanck v. Pioneer Mining Co., 93 Wash. 26, 159 P. 1077; Proctor v. Appleby, 110 Wash. 403, 188 P. 481; Harms O'Connell Lumber Co., supra; 21 C.J. 1152, Estoppel, § 155b(1); 2 Pomeroy's Equity Jurisprudence, 4th Ed., 1680, § 818.

In the Blanck case [93 Wash. 26, 159 P. 1080], just cited, Judge Ellis, speaking for the court, concisely stated the limitations of this type of estoppel as follows: 'Full knowledge of the facts is essential to create an estoppel by silence or acquiescence. [Citing cases]. * * * Mere silence without positive acts, to effect an estoppel, must have operated as a fraud, must have been intended to mislead, and itself must have actually misled. The party keeping silent must have known or had reasonable grounds for believing that the other party would rely and act upon his...