Cumulus Broadcasting, Inc. v. Shim

• Decision Date: 27 April 2007
• Docket Number: No. M2003-02593-SC-R11-CV.,M2003-02593-SC-R11-CV.
• Citation: 226 S.W.3d 366
• Parties: CUMULUS BROADCASTING, INC.<SMALL><SUP>1</SUP></SMALL> et al. v. Jay W. SHIM et al.
• Court: Tennessee Supreme Court

226 S.W.3d 366

CUMULUS BROADCASTING, INC.¹ et al. v. Jay W. SHIM et al.

No. M2003-02593-SC-R11-CV.

Supreme Court of Tennessee.

April 27, 2007.

Douglas Ray Pierce and Jeremy Wayne Parham, Nashville, Tennessee, for the appellants, Phoenix of Hendersonville, Inc. and Cumulus Broadcasting, Inc.

James Carson Hofstetter, Nashville, Tennessee, for the appellee, Jay W. Shim.

OPINION

GARY R. WADE, J., delivered the opinion of the Court, in which WILLIAM M. BARKER, C.J., and JANICE M. HOLDER and CORNELIA A. CLARK, JJ. joined.

The chancery court granted a motion for summary judgment to the Plaintiff on the theory of adverse possession under the common law. The Court of Appeals reversed and dismissed based upon Tennessee Code Annotated section 28-2-110 (2000), holding that there was a failure on the part of the Plaintiff to pay real estate taxes on the land area at issue. We granted permission to appeal in order to determine whether the chancellor erred by failing to address a motion to amend before ruling on the motion for summary judgment and also to consider whether the statutory bar applies in these circumstances. Although the chancellor erred by failing to grant the motion to amend before entering judgment, the error was harmless because the statutory bar to an adverse possession claim does not apply to contiguous tracts where the area of dispute is not substantial and each of the owners have paid taxes on their respective properties.

In 1966, James E. Charlton and wife, Mildred W. Charlton, the owners of approximately 21.75 acres located on Campbell Road in Goodlettsville, subdivided their property into two tracts. Later that year, the Charltons conveyed a 16.95 acre tract to Lawrence W. Johnson and wife, Elizabeth J. Johnson. A few months later, the Charltons sold by metes and bounds description their remaining 4.8 acre tract, which included their residence, to Charles H. James and wife, Frances O. James (the Shim Tract). After a series of transfers, the Defendant, Jay W. Shim ("the Defendant" or "Shim"), ultimately acquired title to the residence and property in 1994. An existing livestock fence was at or near the common boundary. Each of the two properties had frontage access along Campbell Road, a public road. On August 3, 1970, the Johnsons subdivided their property, conveyed by metes and bounds description 5.2 acres to Hendersonville Broadcasting Corporation, Inc. ("Hendersonville Broadcasting") (the Cumulus tract), and thereby reduced their remaining acreage to 11.75 (the Johnson tract). No reference was made to the fence. For purposes of clarity, a modified tax map identifying the Shim, Cumulus, and Johnson tracts appears below:

NOTE: OPINION CONTAINING TABLE OR OTHER DATA THAT IS NOT VIEWABLE

In 1971, Hendersonville Broadcasting built a 462 foot commercial radio station tower and transmitter on a hill on the Cumulus tract in order to operate radio station WQQK and, in 1974, constructed a twenty-foot-wide service road from Campbell Road to the Cumulus tract. The road, the only access to the tower, was located on the Johnson tract side of the livestock fence. As indicated, the fence generally traversed the common boundary with the Shim tract. The record indicates that the service road is within twenty to twenty-five feet of the Shim residence at its closest points.

Affidavits establish that the employees of Hendersonville Broadcasting and their successors in title have traveled the service road to the radio station tower and transmitter regularly since 1974. Portions of the road were paved in 1978. Natural gas, electric, and telephone service have been provided to the Cumulus tract. These facts do not appear to be in dispute.

On June 21, 1982, the Cumulus tract was acquired by Phoenix, which, despite a subsequent transfer of the business to Dickey Brothers, was the record owner at the time of the litigation. The deed to Phoenix described a 5.2 acre tract with a twenty-foot service access road to Campbell Road, indicating the fence line as the common boundary with the Shim tract. The legal description was not quite the same as in the Johnson to Hendersonville Broadcasting conveyance, extending the boundary at various points within the service road to the fence line.² No changes were made to the Cumulus and Shim tax parcel as a result of the difference in the descriptions between the Johnson to Hendersonville Broadcasting conveyance and the Hendersonville Broadcasting to Phoenix conveyance. Thus, there was no additional assessment.

On November 20, 2000, some twenty-six years after the construction of the service road and six years after his purchase of the property, Shim, who by affidavit described the road as "an eyesore," had the boundaries of his property surveyed for the first time. The survey, the accuracy of which is not in dispute, indicated that portions of the Cumulus tract service road overlapped the boundary onto the Shim tract. In 2001, Shim, who was previously unaware "that a portion of the access road . . . was on my property," unilaterally removed the old livestock fence, bulldozed a portion of the service road, and built another fence along the lines of the new survey. This new enclosure obstructed the portion of the roadway encroaching upon the Shim tract, thereby blocking vehicle access to the tower and transmitter.

On October 19, 2001, Dickey Brothers, which had acquired Phoenix as a subsidiary in 1997 and continued to operate WQQK, filed suit in the Chancery Court of Davidson County seeking injunctive relief. The chancellor entered a temporary restraining order enjoining Shim from blocking access to the tower and transmitters. Subsequent amendments demanded damages for the claimed trespass by Shim and sought to quiet title to the disputed area. By order, Phoenix was added as a Plaintiff. Later, Lawrence W. Johnson and wife, Elizabeth J. Johnson, the original sellers of the two tracts, were added as Defendants. Shim filed a counterclaim for trespass and a third party complaint against James Bridges Dillehay, from whom he had acquired the property in 1994. Dillehay, in turn, filed a third party complaint against his predecessor in title, Tony S. Sloan, from whom he had acquired the property in 1987.

On April 30, 2003, the Plaintiff filed a motion for summary judgment. In response, Shim challenged the sufficiency of the evidence for a finding of adverse possession, questioned whether there was continuous usage between 1980 and 1982, and, among other things, argued that Tennessee Code Annotated section 28-2-110, which bars claims of adverse possession based upon non-payment of taxes, required dismissal. During the course of the litigation, Cumulus acquired the radio station. On May 23, 2003, a motion was filed by Dickey Brothers to substitute Cumulus as the lead Plaintiff. Later, the chancellor granted the request. By June 4, 2003, the supporting affidavits had been filed by each side to the controversy. On the following day, the Plaintiff filed a motion to amend to add two alternative theories of relief: (1) defensive adverse possession under Tennessee Code Annotated sections 28-2-102 and 103; and (2) an easement by prescription in the service road area. The Defendant objected to the motion to amend.

By order on June 23, 2003, the chancellor granted the Plaintiff summary judgment based upon common law adverse possession of the service road area but denied summary judgment based upon Tennessee Code Annotated sections 28-2-101 through 103, the first of the two grounds asserted in the motion to amend, because there were "genuine issues of material fact as to whether that theory [was] being asserted defensively," as set out in 28-2-102 and 103, and also issues of fact as to 28-2-101, whether the adverse possession "with color of title was in good faith." The chancellor rejected the Defendant's claim that Tennessee Code Annotated section 28-2-110 was a bar to the Plaintiff's claim. The third party complaints against Dillehay and Sloan were dismissed. While having addressed one of the two claims in the order granting summary judgment, the chancellor made no reference to that portion of the motion seeking to amend on the alternative theory of easement by prescription. The issue of damages was not addressed and is not a subject of this appeal.

On June 27, 2003, four days after the chancellor's ruling, the Plaintiff Cumulus and the Defendants Lawrence W. Johnson and wife, Elizabeth J. Johnson, entered into an agreed judgment establishing a common boundary line as indicated by the 1970 recorded deed from the Johnsons to Hendersonville Broadcasting. Within days thereafter, Shim gave notice of voluntary dismissal of his counterclaim but also filed a motion to alter or amend the judgment, contending that the affidavits filed by the Plaintiff failed to establish continuous adverse possession under the common law for the requisite period of twenty years. On September 10, 2003, the chancellor entered a memorandum and order denying the motion, specifically finding that unrefuted circumstantial evidence established adverse use between 1980 and 1982.

On appeal, Shim again challenged whether the Plaintiff had established adverse and continuous use and possession, questioned the propriety of late filed affidavits, argued for dismissal under Tennessee Code Annotated section 28-2-110, and asked for a summary judgment as the nonmoving party. The Court of Appeals reversed the chancellor's ruling, concluding that the failure on the part of Cumulus and its predecessors in title to pay real property taxes on those small portions of the service road within the Shim tract as defined by the 2000 survey, as required by Tennessee Code Annotated section 28-2-110(a), was fatal to the claim. Because of its reliance on this statutory bar, the Court of Appeals did not address the evidentiary basis for the chancellor's finding in the body of the opinion but by footnote did observe that "the undisputed evidence...