Estate of Johnston v. TPE Hotels, Inc.

• Decision Date: 11 September 1998
• Docket Number: No. 97-564,97-564
• Citation: 719 So.2d 22
• Court: Florida District Court of Appeals
• Parties: 23 Fla. L. Weekly D2117 ESTATE OF Mary Grace JOHNSTON, deceased, Appellant, v. TPE HOTELS, INC., a Florida Corporation, Appellee.

Page 22

719 So.2d 22

23 Fla. L. Weekly D2117

ESTATE OF Mary Grace JOHNSTON, deceased, Appellant, v. TPE HOTELS, INC., a Florida Corporation, Appellee.

No. 97-564.

District Court of Appeal of Florida Fifth District.

Sept. 11, 1998.

Rehearing Denied Oct. 14, 1998.

R. Stephen Miles, Jr. of Miles and Cumbie, P.A., St. Cloud, for Appellant.

Patrick C. Crowell of Patrick C. Crowell, P.A., Orlando, for Appellee.

W. SHARP, Judge.

Mary Grace Johnston appeals from an adverse final judgment in a quiet title suit, in which she sought to defend and establish her rights, as the owner of the claimed dominant tenement to a perpetual easement over the claimed servient tenement, now owned by TPE Hotels. The trial court ruled that the easement had been terminated by virtue of various doctrines: platting without showing the easement on the plat, estoppel by deed, novation, and abandonment. We affirm.

The parties do not dispute the facts in this case. The issues here are purely ones of law and much to our surprise (given the often litigated and much written upon subject of real estate title transactions) constitute ones of first impression in this state. In essence, this case presents the question of whether the trial court correctly ruled that an express reservation of a perpetual easement created in a deed of record is extinguished when the owner of the dominant tenement joins with the owner of the servient tenement to dedicate and record a plat encompassing both of their properties, which does not disclose or show the perpetual easement, and successor title holders of the servient tenement not privy to the original parties' thoughts and intents, purchase the property in reliance on the plat.

The property encompassing the disputed dominant and servient tenements was formerly owned by John Johnston, Mary Grace's husband, in the 1960s. It was composed of three tracts of land--2, 3, and 4--described by reference to metes, bounds and surveys. In February 1996, John and Mary Grace conveyed tract 3 to Osceola Inns Corporation by a warranty deed, which was duly recorded. In the deed, John expressly reserved, as to tract 3 (as well as tract 2) the right to use tracts 3 and 2, for purposes of ingress and egress to and from his adjacent lands (tracts 2 and 4).

Tract 3 is located north of tract 4, and east of tract 2 (see appendix). It is shaped like a rectangle, but it has a long narrow sleeve-shaped extension to the south that runs between tracts 2 and 4 and provides tracts 2 and 4, as well as tract 3, with access to U.S. Highway 441-192. This access easement was in continuous use by the dominant tenements (tracts 2 and 4) from its creation, up until the time of this litigation.

In 1966, John Johnston was the president and principal shareholder of Osceola Inns. In September, he and Osceola Inns executed and recorded a plat of their lands, which included tracts 2, 3 and 4 and other property owned by him. It was designated the "Shady Deal" Subdivision. The plat did not change the configuration of tracts 2, 3 and 4, nor their names, except to call them lots rather than tracts. However, there is no reference to the perpetual easement for ingress and egress over the sleeve portion of lot 3 in the plat, and it is not shown on the map.

First Federal Savings and Loan Association held mortgages on the property when it was platted. According to the testimony of John Johnston, First Federal required that he and Osceola Inns grant one another express reciprocal twenty-year easements. In 1972, Osceola Inns granted Johnston a 20-year easement over the sleeve portion of lot 3 and Johnston granted Osceola Inns a 20-year easement over lot 4. The easements were recorded.

First Federal's requirement or request for reciprocal easements was apparently made in connection with a transaction between Osceola Inns and Vacation Motels of Florida, Inc., pursuant to which Vacation acquired all of the stock of Osceola Inns. Johnston testified First Federal required a 20-year easement because that was the term of its mortgage and because there was something in the original easement that did not suit it. He said First Federal expressed the concern that the perpetual easement did not give it the "control" it needed.

Johnston further testified at that time he was not an officer, director nor shareholder of Osceola Inns. He did not know why that corporation executed the reciprocal easement. He said he did not intend to release, limit or extinguish the perpetual easement. He also noted that the reason the easement was not shown on the plat was because he intended it to be a private easement only and not one dedicated to the public.

By 1970, John Johnston and his first wife, Mary Grace, had divorced and he and his second wife had moved to Australia. In 1973, John conveyed lots 2 and 4 to Loranda Properties, Inc., a corporation established by him for the benefit of his children. In 1977 Loranda conveyed lots 2 and 4 to Mary Grace. None of these deeds mentioned the private perpetual easement over lot 3, although they need not have done so because had the easement survived, it would have passed as appurtenant to the dominant tenements (lots 2 and 4). ¹

Lot 3 was conveyed to successor owners, not in privity with the Johnstons or Osceola Inns, the last being TPE Hotels, the plaintiff in this law suit. None of the deeds in the chain of title mentioned the private perpetual easement. TPE Hotels took title from BWZ, Inc. in 1992. The deed conveyed lot 3 of the Shady Deal Subdivision, according to the plat thereof (with references to Plat Book and Page) "Subject to: liens, encumbrances, covenants, restrictions and easements of record...." At the trial in this case, TPE's executive officer testified that prior to his corporation's purchase of lot 3, he had checked the Shady Deal Plat and relied on it. He also testified he relied on the prior owner's representation that the 20-year easement over lot 3 had expired.

Between 1984 and 1988, the Johnstons sent letters to the owners of lot 3, attempting to acquire a permanent easement over the sleeve portion of lot 3, or seeking to extend the 20-year easement, which had been created in 1972. Mary Grace currently owns lots 2 and 4. Her son, David Johnston, owns Crystalbrook Golf Club of Osceola Inc., and Greenscape Mowing, businesses which are currently tenants of lots 2 and 4. The Johnstons (David and Mary Grace) use lots 2 and 4 to operate a golf course and landscape business and these businesses also continuously used the sleeve portion of lot 3 for access to Highway 192, until this controversy arose.

In 1994, TPE Hotels sued Crystalbrook Golf Club and Greenscape Mowing for trespass and damages. It alleged these businesses were using the then expired 20-year easement over lot 3, as well as other property, without its permission and consent. The defendants filed affirmative defenses and counterclaims for trespass over lots 2 and 4. Mary Grace intervened in the proceedings, and counterclaimed to establish her right as the successor owner of the dominant tenement (lots 2 and 4) to use the perpetual easement across lot 3, which had been created by the reservation in the 1966 recorded deed to Osceola Inns.

After a non-jury trial, the court ruled that the perpetual easement had been extinguished by the act of platting the lands, without reserving or showing the easement on the plat, that Mary Grace was estopped by deed to assert the perpetual easement because of the exchange of 20-year easements, that the reciprocal easements constituted a novation of the perpetual easement, and that both the platting and the reciprocal easement constituted an abandonment of the perpetual easement. It further ruled that Mary Grace's counterclaim to quiet title to the perpetual easement was barred by the statute of limitations. It awarded TPE $100.00 damages for trespass and Crystalbrook $100.00 damages against TPE. While we do not agree with all of the theories advanced by the trial judge, we agree with the result of the case and affirm. ²

The theory of novation requires that the party asserting it carry the burden of proving the original parties' intent (Osceola Inns and John Johnston) ³ to the original transaction, to release the first right or contract in exchange for a later binding right or contract. Jakobi v. Kings Creek Village Townhouse Ass'n, Inc., 665 So.2d 325 (Fla. 3d DCA 1995); Brown v. Kelly, 545 So.2d 518 (Fla. 5th DCA 1989); Electro-Protective Corp. v. Creative Jewelry by Kempf, Inc., 513 So.2d 190 (Fla. 5th DCA 1987). That element of proof was not established in this case.

There is no testimony in this record to show that John Johnston and Osceola Inns, at the time they executed and recorded the 20-year reciprocal easements, intended to release and extinguish the perpetual easement over tract 3, which ran solely in Johnston's favor, in exchange for the 20-year reciprocal easement over tract 3 and 4. In fact, as appellants point out, Johnston gave up a far more valuable right than he received and he burdened tract 4.

The only testimony on this point was that the reciprocal easements were required by the mortgagee, who was apparently financing the transaction between Osceola Inns and Vacation Motels, no doubt for title and security reasons not understood by nor concurred in by Johnston. Although the existence vel non of an agreement between the parties to discharge an existing obligation by substituting another is normally a question of fact for the jury, ⁴ where there is no such evidence the fact of the granting and recording of the reciprocal easements alone is insufficient to establish that a novation occurred. See Prucha v. Guarantee Reserve Life Ins. Co. of Hammond, 358 So.2d 1155 (Fla. 3d DCA 1978), cert. denied, 370 So.2d 459 (Fla.1979).

Similarly, the theory of abandonment requires proof of the intent of the owner of the dominant tenement (Johnston) to extinguish or abolish an easement previously acquired....