KT Grp., LLC v. Lowe

• Decision Date: 19 October 2018
• Docket Number: No. E2017-02415-COA-R3-CV,E2017-02415-COA-R3-CV
• Citation: 578 S.W.3d 1
• Parties: KT GROUP, LLC v. Robert LOWE et al.
• Court: Tennessee Court of Appeals

578 S.W.3d 1

KT GROUP, LLC

v.Robert LOWE et al.

No. E2017-02415-COA-R3-CV

Court of Appeals of Tennessee, Eastern Section, AT KNOXVILLE.

May 31, 2018 Session

FILED October 19, 2018

Application for Permission to Appeal Denied by Supreme Court February 21, 2019

Terry M. Basista, Jacksboro, Tennessee, for the appellants, Robert Lowe and Velma Lowe.

C. Patrick Sexton, Oneida, Tennessee, for the appellees, KT Group, LLC.

Charles D. Susano, Jr., J., delivered the opinion of the court, in which D. Michael Swiney, C.J., and John W. McClarty, J., joined.

This case involves a property dispute regarding a fifty-foot strip of land that was historically used for railroad purposes. KT Group, LLC (plaintiff) filed an action to quiet title, naming Robert Lowe and his wife, Velma Lowe, as defendants. Each side claims to own the strip of land in fee simple absolute. The trial court determined that plaintiff owned the land in fee simple. Defendants appealed. We affirm.

I.

The material facts of this case are not in dispute. In July 2015, plaintiff acquired by quitclaim deed a strip of land in Scott County that is approximately 12.63 miles long and fifty feet wide. Although the parties refer to this strip of land as "the Brimstone Railway Line," the property has not been used for railroad purposes for many years.¹ Shortly after acquiring the property, plaintiff began removing rails and crossties from the rail line. Plaintiff also entered into contracts to sell the gravel from the existing roadbed.

In September 2015, defendants erected barriers that prevented plaintiff from accessing the portion of the rail line running across their property. Defendants also sent plaintiff a letter claiming fee simple ownership of the portion of the rail line running across their property. In response, plaintiff initiated this action to quiet title. In addition to seeking a declaration of ownership, plaintiff sought damages incurred as a result of defendants' interference with plaintiff's use of the property. Defendants filed an answer denying that plaintiff had any rights in the property.²

At trial, both parties presented expert testimony from title attorneys. Both experts traced the chain of title back to a 1921 deed. The parties stipulated that the court's construction of that deed would determine their respective interests in the property. For the sake of clarity, we quote the relevant portions of the 1921 deed and emphasize the language important to this case:

For and in consideration of Ten ($ 10.00) Dollars cash in hand paid, and other considerations not necessary here to mention, we, [grantors] of Scott County, Tennessee, have bargained and sold, and by [sic] hereby transfer and convey , unto Round Mountain Lumber & Coal Company ... a tract or strip of land fifty (50) feet wide through three tracts of land in what was formerly the 14th Civil District of Scott County, Tennessee ...; the said fifty (50) feet strip being more particularly described as follows: to wit:

Twenty-five feet on each side of a line beginning in the boundary line between our land and the land of Wesley Parsons, and in the center of the said Round Mountain Lumber & Coal Company's right of way , and running thence substantially with the Holt Survey as now staked out across our property to the center of the said Round Mountain Lumber & Coal Company's right of way on the Cleveland Potter line; the above being across one of our tracts[.]

And then beginning in the center of the said Round Mountain Lumber & Coal Company's right of way where it leaves the Cleveland Pott[e]r line; and running with the Holt Survey across another of the above tracts to the center of the said right of way where it enters one of the Mand[y] Newport tracts; Then beginning in the center of said right of way where it leaves the first Mandy Newport tract; and running substantially with the said Holt Survey across the third tract to the center of the said right of way where it enters the second Mandy Newport tract; the said strip of land to be used for Railroad purposes.

The final location of the v[e]ndee or its assigns shall definitely fix and determine the description of the 50 foot strip hereby conveyed ; provided, however, that any such permanent location shall be substantially in accordance with the present survey.

To have and to hold the said strip, tract or parcel of land , together with the appurtenances, estate, right, title and interest thereunto belonging, unto the said Round Mountain Lumber & Coal Company, its successors and assigns, in fee simple forever .

We covenant that we are lawfully seized and possessed of the said property, have a good right to convey it, and that it is un[e]ncumbered; and we warrant to forever defend the title thereto unto the said vendee, its successors and assigns, against the lawful claims of all persons whomsoever.

(Bold print added.)

Plaintiff's expert witness testified his professional opinion was that the 1921 deed conveyed fee simple ownership of the strip of land to Round Mountain Lumber & Coal Company (Round Mountain). Defendants' expert witness, however, testified that the deed merely granted Round Mountain an easement to use the strip of land for railroad purposes. Furthermore, defendants' expert testified that once the land was "abandoned for railroad purposes, then that interest was extinguished and completely vested back in the [defendants]." Ultimately, the trial court found that the 1921 deed conveyed the strip of land to Round Mountain in fee simple. Accordingly, the court held that plaintiff, as Round Mountain's successor in interest, also held the property in fee simple. The court did not rule on plaintiff's request for damages. Defendants appeal.

II.

The sole issue on appeal is whether the trial court erred in determining that plaintiff holds the disputed property in fee simple. Because plaintiff did not challenge the trial court's failure to rule on its request for damages, plaintiff waived that issue on appeal. See Lapinsky v. Cook , 536 S.W.3d 425, 439 n.2 (Tenn. Ct. App. 2016).

III.

Resolution of the ultimate issue in this case requires us to consider whether the trial court erred in its interpretation of the 1921 deed. The interpretation of a deed is a question of law, which we review de novo without a presumption being accorded to the correctness of the trial court's legal conclusion. Griffis v. Davidson Cty. Metro. Gov't , 164 S.W.3d 267, 274 (Tenn. 2005).

In Tennessee, there is a statutory presumption that a deed passes the entirety of the grantor's interest in the property absent evidence of a contrary intent. Specifically, Tenn. Code Ann. § 66-5-101 (2015) provides that

[e]very grant or devise of real estate, or any interest therein, shall pass all the estate or interest of the grantor or devisor, unless the intent to pass a less estate or interest shall appear by express terms, or be necessarily implied in the terms of the instrument.

As the Supreme Court has explained,

The purpose of [the predecessor statute of Tenn. Code Ann. § 66-5-101 ] was to abolish the common law rule requiring words of inheritance as an indispensable prerequisite to the creation of an absolute estate in fee simple. And since the enactment of these statutes, the courts look to the whole instrument, without reference to formal common law divisions of deeds and common law rules of construction in order to ascertain the intention of the parties, and will not allow technical rules to override the intent.

Pickens v. Daugherty , 217 Tenn. 349, 397 S.W.2d 815, 819 (1965) (citations omitted).

Thus, "[i]n construing a deed, a court's primary goal ‘is to ascertain the grantor's intent from the words of the deed as a whole and from the surrounding circumstances.’ " Bryant v. Bryant , 522 S.W.3d 392, 412 (Tenn. 2017) (quoting Griffis , 164 S.W.3d at 274 ). However, "where the deed is so confused and contradictory in its wording, and where the surrounding circumstances held no light upon the intent of the grantor, then the courts must, as a last resort, rely upon the common law rule which places precedence upon the premises [granting clause] over the habendum clause." Bennett v. Langham , 214 Tenn. 674, 383 S.W.2d 16, 20 (1964) (emphasis added); see also Hall v. Hall , 604 S.W.2d 851, 854 (Tenn. 1980) (noting that the Supreme Court has "not totally abandon[ed] this rule of construction....").³

IV.

We begin with the statutory presumption that the 1921 deed conveyed to Round Mountain the entirety of the grantors' interest in the property (in this case, a fee simple). See Tenn. Code Ann. § 66-5-101. Defendants attempt to rebut that presumption by arguing that the deed's express terms demonstrate an intention to grant a mere easement for railroad purposes. In support of their argument, defendants point out that the deed's descriptive clause uses the phrase "right of way" six times. They also observe that the descriptive clause concludes with the statement: "the said strip of land to be used for Railroad purposes."

Plaintiff, on the other hand, emphasizes the language appearing in the granting clause and the habendum clause of the deed. The granting clause states that the grantors "have bargained and sold, and by [sic] hereby transfer and convey ... a tract or strip of land fifty (50) feet wide...." There are no accompanying words of limitation. At the end of the granting clause, the deed states: "the said fifty (50) feet strip being more particularly described as follows...." Here, too, there are no accompanying words of limitation. The habendum clause, which follows the descriptive clause, gives Round Mountain and "its successors and assigns" the right "[t]o have and to hold the said strip, tract or parcel of land, together with the appurtenances, estate, right, title and interest thereunto belonging ... in fee simple forever."

As previously stated, "[i]n construing a deed, a court's primary goal ‘is to ascertain the grantor's intent from the words of the deed as a whole and from the surrounding...