David W. v. Paramount Homes Llc

Decision Date24 May 2011
Docket NumberNo. DA 10–0435.,DA 10–0435.
Citation360 Mont. 421,253 P.3d 903,2011 MT 112
PartiesDavid W. and Joann A. GIBSON, and the Prairie Drive Subdivision Home Owner's Association, a Montana corporation, Plaintiffs and Appellants,v.PARAMOUNT HOMES, LLC, a Montana LLC, United States Seamless of SW Montana, Inc., a Montana corporation, Defendants, Appellees and Cross–Appellants.
CourtMontana Supreme Court

OPINION TEXT STARTS HERE

For Appellants: J. Troy Redmon; Redmon Law Firm, P.C., Bozeman, Montana.For Appellees: Karl Knuchel, Attorney at Law, Livingston, Montana.Chief Justice MIKE McGRATH delivered the Opinion of the Court.

[360 Mont. 422] ¶ 1 David and Joann Gibson and the Prairie Drive Subdivision Home Owner's Association (collectively referred to as Gibsons) sued Paramount Homes and U.S. Seamless (collectively referred to as the Developers) to enforce their easement over Prairie Drive in Park County, Montana, near the City of Livingston. Gibsons appeal from the District Court's Findings of Fact, Conclusions of Law and Order dated August 4, 2010.

BACKGROUND

¶ 2 The property now owned by Gibsons and Developers was at one time owned by Petersons, who subdivided it and sold larger multi-acre lots. In 1993 and 1994, Petersons recorded certificates of survey depicting an express 60–foot wide easement for ingress and egress to their subdivision over a road called Prairie Drive. In July, 1994, Petersons and other adjacent land owners who used Prairie Drive entered an “Agreement for Maintenance of Roads and Establishment of Home Owner's Association.” This established and recognized their rights to use Prairie Drive as a private easement, and that future purchasers of tracts in Petersons' subdivision would have the same rights. The agreement provided that all future purchasers of Peterson lots became members of the Home Owner's Association with easement rights to Prairie Drive. In 1995 Park County, as part of its approval of the subdivision, required Petersons to dedicate Prairie Drive to the public for access.

¶ 3 The Developers purchased one of the tracts of the Peterson subdivision, to have it annexed by the City of Livingston with the intent to further subdivide it into smaller lots. In a May, 2000, letter the developers stated that their project contemplated 58 single-family lots and 19 multi-family lots on 29 acres. Since Gibsons' property and the Developers' property were parts of the original Peterson subdivision, they are all members in the Home Owner's Association. They are thereby parties to the maintenance agreement originally executed in 1994. Prairie Drive and Gibsons' easement crossed the Developers' land and Developers acquired the land subject to the easement and to membership in the Home Owner's Association. Gibsons operate a large ranch and, along with other property owners in the largely rural area, used the easement over Prairie Road for a number of years to move vehicles, trailers, and heavy equipment in and out of the area.

¶ 4 After annexation of their land into the City of Livingston, the Developers successfully completed the process to subdivide their property into small lots with paved streets bordered by curbs and gutters. The City Commission approved the preliminary plat for the Ridgeview Subdivision on August 15, 2005. The staff report recommending approval noted that the subdivision will extend the City's street network to serve the project and that each lot would be added to the City's street maintenance district and be assessed in the same manner as other lots in the City. The Developers recorded the final subdivision plat on May 6, 2006, which provided the location of specific streets and lots. Even though parts of it are relocated, Prairie Drive continues to exist after construction of the Developers' subdivision, but it is now paved, narrower, and bordered by curbs and gutters. The Developers also replaced a previous gradual sweeping “S” curve in Prairie Drive with two essentially right-angle corners. See illustration below showing Prairie Drive as relocated by the Developers, depicted with diagonal shading, and the original location depicted with dashed-line borders.

Image 1 (5.03" X 3.86") Available for Offline Print

[360 Mont. 424] ¶ 5 Gibsons sued both the City of Livingston and the Developers seeking recognition and enforcement of their easement. The case was tried to the District Court without a jury in February, 2010.1 The District Court entered its Findings of Fact, Conclusions of Law and Order in August 2010. Referring to the reconfiguration of the two gradual curves, the District Court found that the Developers' reconstruction of Prairie Drive for the subdivision created a “permanent obstruction” to Gibsons' easement in two locations, “effectively obliterating the easement and making passage by vehicle impossible.”

¶ 6 The District Court found that the new street alignment decreased the quality of Gibsons' access; has created safety and access quality issues; and was not an adequate replacement for Gibsons' easement based upon their prior use and the applicable engineering standards. The District Court found that longer and larger vehicles that could easily negotiate the former “S” curve on Prairie Drive could not easily negotiate the two new right-angle turns required to get through the subdivision.

¶ 7 The District Court held that Gibsons' easement existed independently of any public right to use the Prairie Drive right of way, but concluded that while the Developers had obstructed and obliterated Gibsons' easement, the new road through the subdivision “is superior in construction to the historic Prairie Drive.” Consequently, the District Court ordered that the Developers bear the cost of a new certificate of survey showing Gibsons' platted easement to be in the location of the new road through the subdivision, and permanently enjoined the Developers from any further obstruction of the easement. The District Court also ordered the Developers to re-build the two new right-angle turns to “increase the radii of the road so that all vehicles, including those oversized vehicles utilized for recreation and business of the [Gibsons] may proceed without having to go off the roadway or cross lanes.”

¶ 8 In explanatory comments the District Court stated that the interference with Gibsons' easement “can be remedied by widening or eliminating the curbs and other obstructions” in the new road. The District Court determined that further relief was stymied by the fact that the road is now the property of the City of Livingston and any alterations in the road require the City's prior approval. Since the City had been dismissed as a party, the District Court concluded that it had no authority to order the City to re-locate the streets in the annexed subdivision. Last, the District Court ordered that each party bear its own costs and attorney fees.

¶ 9 Gibsons agree with the District Court's findings of fact and conclusions of law, but contend that the District Court erred in refusing to restore their “historical” easement rights in Prairie Drive and in failing to award them attorney fees and costs as the prevailing party in the litigation. Developers cross-appeal contending that the District Court erred in not dismissing the Home Owner's Association for lack of standing; that the 1995 dedication of Prairie Drive as a public road extinguished any grant of easement to Gibsons; that the annexation of their subdivision and dedication of Prairie Drive as a city street extinguished the easement; that Gibsons' settlement with the City extinguished all their claims; and that they, the Developers, prevailed and are entitled to attorney fees.

STANDARD OF REVIEW

¶ 10 This Court reviews a district court's conclusions of law to determine whether they are correct, while findings of fact will be upheld unless they are clearly erroneous. Omimex Can., Ltd. v. State of Montana, 2008 MT 403, ¶ 16, 347 Mont. 176, 201 P.3d 3. A decision on a request for an award of attorney fees is reviewed for abuse of discretion unless a contract requires an award of fees, in which case a district court lacks discretion to deny the request. Emmerson v. Walker, 2010 MT 167, ¶ 20, 357 Mont. 166, 236 P.3d 598; In re Szafryk, 2010 MT 90, ¶ 19, 356 Mont. 141, 232 P.3d 361. In that case we review the district court's construction and interpretation of the contract to determine whether it is correct. Szafryk, ¶ 19.

DISCUSSION

¶ 11 Issue One: Whether the District Court erred in refusing to enforce Gibsons' historical easement rights.

¶ 12 The District Court found that Gibsons had a valid easement over Prairie Drive that could not be moved and otherwise altered as the Developers did without Gibsons' consent. Gibsons argue that since the easement was altered and obstructed by the Developers' subdivision, it was error for the District Court to conclude that the new road was “superior in construction” to the old one and to allow the two new turns to remain in the new location. They contend that it was error to not require that the new Prairie Drive be re-built to the same width and alignment of the former Prairie Drive.

¶ 13 Gibsons correctly note that the owner of the servient estate (here, the Developers) may not ordinarily change the location of a right of way without the consent of the easement holder (here the Gibsons). This is the law in Montana. Parker v. Elder, 233 Mont. 75, 80, 758 P.2d 292, 295 (1988). Nevertheless, the rights of the servient landowner to reasonably use the land must be considered along with the right of the easement holder to reasonably use the easement. Tungsten Holdings, Inc. v. Kimberlin, 2000 MT 24, ¶ 40, 298 Mont. 176, 994 P.2d 1114 (servient landowner failed to establish that a gate across an easement was reasonably necessary for the enjoyment of the land).

¶ 14 One of Gibsons' primary concerns about routing their easement through the subdivision was that the corners were...

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