Jackson v. Scheible

• Decision Date: 10 March 2009
• Docket Number: No. 03S01-0807-CV-390.,03S01-0807-CV-390.
• Citation: 902 N.E.2d 807
• Parties: Fred JACKSON, Appellee (Defendant below), v. Christine R. SCHEIBLE, As the Mother of Travis David Scheible, Deceased, Appellant (Plaintiff below).
• Court: Indiana Supreme Court

902 N.E.2d 807

Fred JACKSON, Appellee (Defendant below), v. Christine R. SCHEIBLE, As the Mother of Travis David Scheible, Deceased, Appellant (Plaintiff below).

No. 03S01-0807-CV-390.

Supreme Court of Indiana.

March 10, 2009.

David W. Craig, Scott A. Faultless, Indianapolis, IN, Attorneys for Appellant.

R. Jeffrey Lowe, J. Todd Spurgeon, New Albany, IN, Eric D. Johnson, Indianapolis, IN, Attorneys for Appellee.

On Petition to Transfer from the Indiana Court of Appeals, No. 03A01-0704-CV-186.

BOEHM, Justice.

In Valinet v. Eskew, 574 N.E.2d 283, 285 (Ind.1991), we adopted Restatement (Second) of Torts section 363 permitting possessors of land to be held liable for harm caused by the condition of trees on land near a highway. A seller of land may be liable for harm caused by the condition of trees on the land near a highway if the seller is in possession or control of the condition of the trees when the harm occurs. In this case, the seller did not retain possession or control of routine maintenance, including trimming of trees, and the trial court correctly entered summary judgment for the seller.

Facts and Procedural History

On July 5, 2005, ten-year-old Travis Scheible was killed in an accident in Columbus, Indiana. According to the complaint, Travis was riding his bicycle and started to cross the street from behind a mature tree that overhung the sidewalk and obscured his view of oncoming traffic. As he rode into the street, Travis was struck by an oncoming car.

The tree was located on residential property previously owned by Fred and Dorothy Jackson. About six months before the accident, the Jacksons sold the property to Ronald Smith under a two-year installment contract, and Smith began residing on the property.

Travis's mother, Christine Scheible, brought a wrongful death action against Fred Jackson and Smith.¹ Jackson moved for summary judgment, arguing that he had no duty to Travis because he did not own, possess, or control the property at the time of the accident. Scheible responded that summary judgment was inappropriate because of genuine issues of material fact regarding Jackson's possession and control of the property at the time of the accident. Scheible also argued that Jackson was negligent per se for failing to comply with a city ordinance requiring landowners to trim trees on their property.

The trial court granted summary judgment in favor of Jackson without explanation. The trial court's order included the findings required by Trial Rule 54(B) for a final judgment, and Scheible appealed.

The Court of Appeals reversed. Scheible v. Jackson, 881 N.E.2d 1052, 1058 (Ind. Ct.App.2008). The Court of Appeals held that a vendor may be liable for harm caused by the condition of sold property if the vendor retains control of the property. Id. at 1055. The majority concluded that there was a genuine issue of material fact regarding whether Jackson controlled the property after the sale. Id. at 1058. Chief Judge Baker dissented. Id. Neither opinion discussed the effect of the city ordinance.

Standard of Review

We review a summary judgment order de novo. Lean v. Reed, 876 N.E.2d 1104, 1107 (Ind.2007). Summary judgment is appropriate when there is no genuine issue of material fact and the moving party is entitled to a judgment as a matter of law. Ind. Trial Rule 56(C). In determining whether summary judgment is appropriate, we construe all facts and reasonable inferences in favor of the nonmoving party. Filip v. Block, 879 N.E.2d 1076, 1080 (Ind.2008).

I. Vendor Liability for the Condition of Trees on Land Near a Highway

The issue here is one of first impression: under what circumstances a vendor of land may be liable to a third party for harm resulting from the condition of trees on the land near a highway. Both parties analyze the question under subsection 363(2) of the Restatement (Second) of Torts (1965),² adopted in Valinet v. Eskew, 574 N.E.2d 283, 285 (Ind.1991). Section 363(2) reads:

A possessor of land in an urban area is subject to liability to persons using a public highway for physical harm resulting from his failure to exercise reasonable care to prevent an unreasonable risk of harm arising from the condition of trees on the land near the highway.

A "possessor" is defined in part as "a person who is in occupation of the land with intent to control it." Id. § 328E(a). Although this is this Court's first case involving a vendor's possession, possession is an issue common to all premises liability cases in order to "subject to liability the person who could have known of any dangers on the land and therefore could have acted to prevent any foreseeable harm." Rhodes v. Wright, 805 N.E.2d 382, 385 (Ind.2004). A theme throughout our premises liability cases is that liability arises from actual control over the condition causing the injury.³ Generally, a vendor in a land-sale contract will have no liability under section 363 because the vendor no longer occupies or controls the condition of the property even if the vendor retains legal title as security. See Skendzel v. Marshall, 261 Ind. 226, 234, 301 N.E.2d 641, 646 (1973) ("When the parties [to a land-sale contract] enter into the contract, all incidents of ownership accrue to the vendee.... Conceptually, therefore, the retention of title by the vendor is the same as reserving a lien or mortgage.").

Here Scheible acknowledges that a vendor will typically have no post-sale liability, but argues that Jackson can be held liable because he continued "acting like a landowner" after the sale. Scheible designated the following evidence in support of her contention that Jackson retained control of the property.

First, Scheible notes that Smith needed Jackson's permission to make changes to the property. The land-sale contract provided that Smith may treat said real estate as his own with the understanding that [he] shall not commit any waste to said real estate or the improvements thereon. Also, prior to the time of the delivery of title to said real estate, [Smith] shall not construct any improvements on said property without the prior written permission of [the Jacksons.]

Smith testified in deposition that

[I] usually asked before I done something, because I wanted to do it fairly major, and I usually asked permission, because I felt like that if I done something major they should be aware of it, because technically it was still their property even though I was buying it on contract, and that's the way I felt.

Smith provided "knocking out a wall" as an example of a change for which he would ask permission. Smith also testified that he asked permission to remove the tree after the accident, but later stated that "[a]ll I know is they was aware that [the tree] was gonna be taken down. I don't know if I asked." Even when viewed most favorably to Scheible, this evidence does not suggest that Jackson controlled the condition of the property. The evidence merely reflects that the property was security for the installment contract, and Jackson required permission for major changes to protect his security interest.

Second, Scheible points to the fact that Jackson alone held the casualty and liability insurance for the property as evidence that Jackson controlled the property. The land-sale contract provided that Smith would obtain certain levels of casualty and liability insurance for the property and that the policies would name both Smith and the Jacksons as insureds. That provision was not implemented. Instead, Smith paid Jackson the amounts of the premiums to maintain the existing policies, but Smith was never added as an insured.⁴ The policy protected the home against fire and casualty loss, as well as liability to third parties. As with the requirement that Smith receive permission before improving the property, Jackson's maintaining insurance on the property is consistent with his desire to protect his financial investment and does not demonstrate his control.⁵ See Helton v. Harbrecht, 701 N.E.2d 1265, 1268 (Ind.Ct.App.1998) (holding that construction company that carried general work site liability insurance did not control partially-constructed home at the time of accident when none of its employees had been at the site for a month), trans. denied.

Third, Scheible notes that Jackson drove past the property on the way to visit family at least a dozen times each month in the six months before the accident and would have noticed the tree's condition. This fact also does not establish Jackson's control of the property. Upon execution of the land-sale contract, Smith took exclusive possession of the property, leaving Jackson with no control over the maintenance of the property.⁶

Fourth, Scheible argues that Jackson's receipt of a notice from the city regarding tree saplings on the property indicates Jackson's control of the property. Jackson's receipt of the notice indicates that he held legal title to the property but does not establish control. Indeed, after Jackson received the notice, he gave it to Smith, who "agreed to remedy" the problem.

Finally, at some point Smith "renounced his rights" and returned the property to the Jacksons. Some building materials remained on the property. Scheible points to the parties' actions after Smith renounced his rights to the property. Smith testified that he "[r]enounced the rights, signed it back over, left all building materials there because [Jackson] felt like since I bought them for the property, they should stay there.... My thoughts weren't quite happy with that, but I said fine, because it wasn't about the materials." Jackson's assertion of control of the building materials after he had regained possession does not suggest that he controlled the condition of the property at the time of the accident.

In addition to these points raised by Scheible, the Court of Appeals found that the financial terms of the sale raised a question as to the Jacksons' control of the property. The...