EQ Okla., Inc. v. A Clean Env't Co.
| Decision Date | 10 June 2015 |
| Docket Number | Released for Publication by Order of the Court of Civil Appeals of Oklahoma, Division No. 2. ,112,080. |
| Citation | 353 P.3d 557,2015 OK CIV APP 62 |
| Parties | EQ OKLAHOMA, INC., Plaintiff/Appellee, v. A CLEAN ENVIRONMENT COMPANY, Defendant/Appellant. |
| Court | United States State Court of Criminal Appeals of Oklahoma. Court of Civil Appeals of Oklahoma |
Mitchell D. Blackburn, Conner & Winters, LLP, Oklahoma City, Oklahoma, for Plaintiff/Appellee.
Leif E. Swedlow, Andrews Davis, P.C., Oklahoma City, Oklahoma, and Tom Sullivent, Sullivent Law Firm, Tulsa, Oklahoma, for Defendant/Appellant.
¶ 1 A Clean Environment Company (ACE) appeals the trial court's September 13, 2013, order awarding it and EQ Oklahoma, Inc. (EQ) an attorney's fee. Based upon our review of the record and applicable law, we affirm in part, reverse in part, and remand with instructions.
¶ 2 EQ and ACE are companies that process hazardous waste materials. In 2010, EQ purchased an industrial solid and hazardous waste treatment, storage, and disposal facility in Tulsa, Oklahoma, from ACE. ACE retained land adjacent and to the east of the facility (“East Property”) and a five (5) acre tract adjacent and to the north of the facility (the “Monitored Property”). The East Property was a former Sun Chemical ink plant, approximately 85% of which lies within the 100–year floodplain and 12% within the 500–year floodplain.
¶ 3 The Oklahoma Department of Environmental Equality (DEQ) regulates the ownership and operation of industrial solid and hazardous waste treatment, storage, and disposal facilities in Oklahoma and requires that each facility have a DEQ-approved storm water management plan.1 As a condition of EQ's purchase of the facility, DEQ required EQ to test and report the contaminant levels in ground water monitoring wells located on the Monitored Property. Thus, ACE and EQ executed an Amended and Restated Access and Maintenance Easement Agreement on August 19, 2010, granting EQ an access and maintenance easement to access, maintain, and sample monitoring wells on the Monitored Property. The parties further executed an Amended and Restated Drainage Easement, granting EQ a perpetual easement for the drainage of storm water from the EQ property into, over, and across the Monitored Property. ACE further agreed to not interfere or hinder the flow of storm water from EQ's property into, over, and across the Monitored Property.
¶ 4 ACE subsequently began to develop the East Property, including the addition of rock and soil to increase its elevation and the construction of a building in the immediate drainage path of Outfall No. 3. ACE further temporarily filled Outfall No. 3 with a cement plug and installed a manhole system.2 The system, however, lacks the capacity to handle a 100–year storm as required by DEQ in order for EQ to obtain a storm water discharge permit. A series of severe rainstorms subsequently occurred, resulting in flooding at the inlet to Outfall No. 3. EQ spent $7,565.58 to store and treat the storm water prior to discharge.
¶ 5 In April of 2011, EQ sued ACE, seeking declaratory and injunctive relief, and damages. EQ further sought a temporary restraining order and injunction, which the trial court granted, enjoining ACE from interfering with EQ's right to: 1) maintain a storm water drainage pattern consistent with that planned or in place at the time EQ purchased the facility; 2) maintain a storm water drainage pattern across the Monitored Property; and 3) ingress and egress on the Monitored Property for remedial and corrective action. The court also enjoined ACE from further construction on the properties which interfered with EQ's rights.
¶ 6 A non-jury trial was held on October 30 through November 2, 2012. On December 12, 2012, the court entered its findings of fact and conclusions of law: 1) recognizing EQ's express and implied drainage easements and its express access and maintenance easement and enjoining ACE from interfering with the easements; 2) granting EQ access to the East Property for up to one (1) year to fix the drainage property at Outfall No. 3 ; 3) ordering ACE to remove the manhole system at its own expense; 4) awarding EQ $43,000.00 in damages for consulting an engineer; 5) awarding EQ $75,000.00 in damages for construction costs to cure the drainage issue; and 6) awarding EQ $7,565.58 in damages for storm water containment issues. However, the court found in ACE's favor on EQ's contamination claims.
¶ 7 On January 14, 2014, EQ filed an application for an attorney's fee and costs pursuant to 12 O.S.2011, §§ 940 and 942, seeking $254,415.65 in fees and costs. ACE also submitted an application for fees and costs, seeking $90,315.19 in fees and $10,937.68 in costs. The trial court subsequently awarded EQ fees in the amount of $241,275.00 and costs of $10,160.65. The court awarded ACE fees in the amount of $26,878.22. ACE appeals.
¶ 8 The issue of entitlement to an attorney's fee and costs presents purely a legal question which we review de novo without deference to the trial court's determination. Finnell v. Jebco Seismic, 2003 OK 35, ¶ 7, 67 P.3d 339, 342. The appellate court will exercise its “plenary, independent, and non deferential authority when reexamining a trial court's legal rulings.” Neil Acquisition, L.L.C. v. Wingrod Inv. Corp., 1996 OK 125, ¶ 4 fn. 1, 932 P.2d 1100, 1103 fn. 1 ; Spielmann v. Hayes, 2000 OK CIV APP 44, ¶ 8, 3 P.3d 711, 713. Once the trial court determines a fee is to be awarded, the amount of that fee is reviewed to determine whether the trial court made a clearly erroneous conclusion and judgment, against reason and evidence, and thus abused its discretion in granting the attorney's fee award. Broadwater v. Courtney, 1991 OK 39, ¶ 7, 809 P.2d 1310, 1312.
¶ 9 The issue on appeal is whether the trial court erred in awarding EQ an attorney's fee pursuant to 12 O.S.2011, § 940. ACE contends this was legal error as § 940 was inapplicable as a basis for an attorney's fee.
¶ 10 Section 940 provides, in relevant part:
A. In any civil action to recover damages for the negligent or willful injury to property and any other incidental costs related to such action, the prevailing party shall be allowed reasonable attorney's fees, court costs and interest to be set by the court and to be taxed and collected as other costs of the action.
¶ 11 In Oklahoma, the right of a litigant to recover an attorney's fee is governed by the American Rule. Barnes v. Oklahoma Farm Bureau Mut. Ins. Co., 2000 OK 55, ¶ 46, 11 P.3d 162, 179–80 ; TRW/Reda Pump v. Brewington, 1992 OK 31, ¶ 13, 829 P.2d 15, 22. This Rule is firmly established in Oklahoma and provides that courts are without authority to award an attorney's fee in the absence of a specific statute or a contractual provision allowing the recovery of such fees, with certain exceptions. Barnes, 2000 OK 55, at 46, 11 P.3d at 180. The Oklahoma Supreme Court has ruled that exceptions to the American Rule are narrowly defined. See Kay v. Venezuelan Sun Oil Co., 1991 OK 16, 806 P.2d 648. Accordingly, this Court strictly construes any authority for fees and costs. HI–PRO Animal Health v. Halverson, 2002 OK CIV APP 61, ¶ 7, 48 P.3d 119, 121.
¶ 12 ACE asserts EQ's suit sought an adjudication of an implied easement with a mandatory injunction to force restoration of Outflow No. 3's storm water capacity to its alleged pre-purchase condition and that claims seeking to establish implied easements or to abate nuisance interference with easement rights are not claims concerning “physical injury to property.” In addition, ACE contends EQ was only awarded monetary awards for incidental costs, not damages for physical injury to property in the Outflow No. 3 area or otherwise. ACE notes EQ was awarded damages for engineering costs, damages for construction costs to construct drainage works on ACE's property, and damages for storing, testing, and treating storm water and not damages for any physical injury to property. Thus, ACE contends EQ is not entitled to a fee award pursuant to § 940.
¶ 13 EQ disagrees, asserting an easement is property within the meaning of § 940 and that ACE's actions on its own property interfered, obstructed, and frustrated EQ's implied drainage easement at Outfall No. 3. EQ further notes ACE's actions in adding rock and soil to the East Property, constructing a building in the drainage path of Outfall No. 3, temporarily plugging Outfall No. 3 with a concrete plug, and installing an inadequate manhole system resulted in the trial court having to award EQ damages for 1) having to consult an engineer to construct a solution, and 2) for storing, testing, and treating storm water caused by ACE's actions. Thus, EQ contends it sought and obtained damages for the negligent or willful physical injury to property and was properly awarded fees.
¶ 14 “An easement is the right of one person to go onto the land of another and make a limited use thereof.” Head v. McCracken, 2004 OK 84, ¶ 11, 102 P.3d 670, 676 (citing Story v. Hefner, 1975 OK 115, 540 P.2d 562 ). An easement is a legal property right and is the right to do something on another's land, coupled with an interest or estate in the land affected. Head, at 11–12, 102 P.3d at 676–77 ; Buttrill v. Stanfield, 1947 OK 90, 178 P.2d 889. The land benefitted is the dominant tenement and the land burdened by the easement is called the servient tenement. Although a servient owner retains the right to use the land burdened by the easement, the owner may not take any action that unreasonably interferes with the dominant owner's use of the easement.
¶ 15 In the present case, it is undisputed that ACE altered the East Property, including the addition of rock and soil to increase its elevation and the construction of a building in the immediate drainage path of Outfall No. 3. ACE further temporarily filled Outfall No. 3 with a cement plug and installed a manhole system that was inadequate and resulted in...
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