Consolidated Rail Corp. v. MASP Equipment Corp.

• Decision Date: 11 February 1986
• Parties: , 490 N.E.2d 514 CONSOLIDATED RAIL CORPORATION, Appellant-Respondent, v. MASP EQUIPMENT CORP., Respondent-Appellant.
• Court: New York Court of Appeals Court of Appeals

Page 647

499 N.Y.S.2d 647

67 N.Y.2d 35, 490 N.E.2d 514

CONSOLIDATED RAIL CORPORATION, Appellant-Respondent, v. MASP EQUIPMENT CORP., Respondent-Appellant.

Court of Appeals of New York.

Feb. 11, 1986.

Timothy Quinn, New York City, for appellant-respondent.

Alan Scribner, New York City, for respondent-appellant.

OPINION OF THE COURT

SIMONS, Judge.

Plaintiff brought this action against defendant MASP Equipment Corporation to recover possession of a 60-foot wide driveway easement acquired in 1969 by grant from Hunts Point Industrial Park, Inc. to plaintiff's predecessor in interest, Penn Central Transportation Company. The easement crosses land leased by MASP and provides access from 149th Street to plaintiff's land in the Hunts Point Industrial Park area of New York City.

Plaintiff recovered a judgment in Supreme Court, Bronx County, which granted it immediate possession of the driveway easement, a mandatory injunction directing MASP to remove all fencing, equipment and materials obstructing its use of the easement, and a permanent injunction enjoining MASP from encroaching on plaintiff's property. The court ordered that all obstructions be removed within 45 days of the entry of judgment, and ruled further that a penalty of $1,000 a day would be assessed for each day such obstructions remained on the easement after the end of this 45-day period. Upon plaintiff's subsequent motion "to clarify, define and fix amount of the judgment", the trial court amended its judgment to substitute liquidated damages in the amount of $1,000 a day for the penalty.

The Appellate Division, 109 A.D.2d 604, 486 N.Y.S.2d 4, affirmed the amended judgment insofar as it confirmed plaintiff's right to unimpeded use and possession of the easement but it struck the portion of it directing the award of $1,000 in damages for each day after the expiration of the grace period. On appeal to this court, plaintiff contests the Appellate Division's order eliminating the award of liquidated damages and MASP cross-appeals, seeking a judgment in its favor determining that plaintiff, and its predecessor in interest, Penn Central, abandoned their claim to the easement.

There should be an affirmance. The evidence does not support a finding of abandonment and the damage award, entered prospectively for violations of the grace period, cannot be upheld under a theory of either liquidated or punitive damages.

The facts found by the trial court, and affirmed by the Appellate Division, are as follows. Plaintiff's easement was created on October 23, 1969 by a formal, written document titled "Grant and Release of Easements", signed and acknowledged by Penn Central, Hunts Point and others. By this agreement, Penn Central released to Hunts Point an existing "Serpentine" right of way along the shoreline in exchange for a new easement providing Penn Central access to its Oak Point Yard in the Industrial Park from East 149th Street. In a collateral agreement executed December 17, 1969, Hunts Point agreed to pave the entire length of the new easement. (900 Woolworth Redevelopment Corporation succeeded to the interests of Hunts Point in the servient property and MASP is its lessee.) Notwithstanding these agreements, however, the easterly end of the easement has never been opened and, in fact, has been used continuously by Hunts Point, and then MASP for storage of equipment, materials and junk. Consequently, Penn Central and its tenants have been forced to use a "dog-leg" path around the perimeter of MASP's leasehold that crosses other property owned by Woolworth and the Coca Cola Company. The trial court found that plaintiff does not possess any legally enforceable right to the path and has been permitted to use it solely at the sufferance of the property owners.

Plaintiff acquired title to the easement from Penn Central's trustees in bankruptcy in April 1976. At about the same time, Supreme Court decided a pending lawsuit involving Hunts Point, Penn Central and the Idaho Potato Packers Corporation (a lessee of Penn Central) and confirmed Penn Central's right to unimpeded use of the easement. After acquiring title from Penn Central, plaintiff inspected the Oak Point Yard and discovered the continued obstruction of the easement by Hunts Point and the use of the "dog-leg" path as an alternative access route. In December 1979, prior to Woolworth's acquisition of Hunts Point, MASP leased the servient property. In 1981 plaintiff demanded in writing that MASP vacate the easement and when MASP refused, it commenced this action.

We agree with the courts below that MASP failed to prove its affirmative defense that plaintiff and its predecessor in interest, Penn Central, had abandoned the easement. Although an easement created by grant may be lost by abandonment, an owner is under no obligation to make use of his property, and an abandonment does not result by nonuse alone (Gerbig v. Zumpano, 7 N.Y.2d 327, 331, 197 N.Y.S.2d 161, 165 N.E.2d 178; Castle Assoc. v. Schwartz, 63 A.D.2d 481, 487, 407 N.Y.S.2d 717). It results only when there is a nonuse accompanied by an intention to abandon on the part of the owner (see, Snell v. Levitt, 110 N.Y. 595, 604, 18 N.E. 370 [quoting Washburn, Easements, at 661 ff [3d ed] ). As we noted almost 100 years ago: "Abandonment necessarily implies non-user, but non-user does not create abandonment no matter how long it continues. There must be found in the facts and circumstances connected with the non-user an intention on the part of the owner of the easement to give it up, but intention existing coupled with non-user will uphold a finding of abandonment." (Welsh v. Taylor, 134 N.Y. 450, 457, 31 N.E. 896.)

A party relying upon another's abandonment of an easement by grant must produce "clear and convincing proof of an intention...