Mackinac Island Development Co., Ltd. v. Burton Abstract and Title Co.

• Decision Date: 04 May 1984
• Docket Number: Docket No. 68008
• Parties: MACKINAC ISLAND DEVELOPMENT COMPANY, LTD., Plaintiff-Appellee, v. BURTON ABSTRACT AND TITLE COMPANY, Defendant-Appellant, and ST. PAUL TITLE INSURANCE COMPANY, Defendant; Third-Party Cross-Defendant; Appellee, v. STONECLIFFE DEVELOPMENT COMPANY, and George A. Staffan, Third-Party Defendant; Third-Party Plaintiff; Cross-Defendant, v. HUMBARD CHRISTIAN DEVELOPMENT CENTER, INC., Third-Party Defendant; Third-Party Plaintiff; Cross-Appellee, v. George A. STAFFAN, Christopher Georgi, and First National Bank of St. Ignace, Third-Party Defendants.
• Court: Court of Appeal of Michigan — District of US

Page 191

349 N.W.2d 191

132 Mich.App. 504

MACKINAC ISLAND DEVELOPMENT COMPANY, LTD., Plaintiff-Appellee, v. BURTON ABSTRACT AND TITLE COMPANY, Defendant-Appellant, and ST. PAUL TITLE INSURANCE COMPANY, Defendant; Third-Party Cross-Defendant; Appellee, v. STONECLIFFE DEVELOPMENT COMPANY, and George A. Staffan, Third-Party Defendant; Third-Party Plaintiff; Cross-Defendant, v. HUMBARD CHRISTIAN DEVELOPMENT CENTER, INC., Third-Party Defendant; Third-Party Plaintiff; Cross-Appellee, v. George A. STAFFAN, Christopher Georgi, and First National

Bank of St. Ignace, Third-Party Defendants.

Docket No. 68008.

Court of Appeals of Michigan.

Submitted Aug. 4, 1983.

Decided March 5, 1984.

Released for Publication May 4, 1984.

Frank J. Kelley, Atty. Gen., Louis J. Caruso, Sol. Gen., and Terrence P. Grady and Russell E. Prins, Asst. Attys. Gen., for State of Mich.

Stroup, Brown & Mulhauser, P.C. by Nathanial W. Stroup and Charles W. Johnson, Petoskey, for St. Paul Title Ins. Co.

Foster, Swift, Collins & Coey, P.C. by Stephen J. Tresidder, Petoskey, for Humbard Christian Development Center, Inc.

Before V.J. BRENNAN, P.J., and SHEPHERD and QUINNELL, ^* JJ.

SHEPHERD, Judge.

The principal issues raised in this appeal relate to the nature and sufficiency of proof required to establish a claim of adverse possession against a cotenant and against the State of Michigan (State). We hold that a claim of adverse possession may be made against the State and that the Plaintiff originally sought damages from Burton Abstract and Title Company under a title insurance policy covering Mackinac Island property which had been deeded to plaintiff and to which defendant State of Michigan also claimed record title to a 41/63 interest. Defendant State was subsequently added as a third-party defendant on November 15, 1979, on defendant Burton Abstract's motion. On March 28, 1981, plaintiff filed its first amended complaint which named the State as a defendant and raised the claim of adverse possession. On January 8, 1981, St. Paul Title Insurance Company was substituted for Burton Abstract as defendant. After a separate trial on the issue of adverse possession, the trial court ruled that defendant State had lost the 41/63 undivided interest it held in the parcel of land involved as the result of plaintiff's adverse possession of the property. Defendant State now appeals as of right.

proofs in this case were sufficient to establish the claim. ¹

The disputed parcel consists of 36.6 acres with two-thousand, two-hundred eighty feet of waterfront. Defendant State obtained its 41/63 interest in the disputed parcel between the years 1923 and 1927. Plaintiff's predecessors in title include, inter alia: Stonecliffe Development Company; Humbard Christian Development Center, Inc.; Mackinac College; Stonecliffe Associates; Oxford Group, Moral Re-Armament, MRA, Inc., of Michigan (MRA of Michigan); and Oxford Group, Moral Re-Armament, MRA, Inc., of New York (MRA of NY). These predecessors in title trace their claims to various warranty deeds executed and recorded as early as 1946. Plaintiff's interest was acquired in 1977 from its most recent predecessor.

The result of the deeds to plaintiff and its predecessors is that plaintiff now has record title to 100 percent of the property tracing its title back to 1946. As indicated, the State can show record title to a 41/63 interest dating from the period 1923 to 1927. The State acknowledges that plaintiff can legitimately claim an interest in 22/63 of the parcel. The plaintiff now claims that the remaining 41/63 belongs to it by reason of adverse possession.

The acts which plaintiff claims gave rise to adverse possession began in 1959 (some 13 years after plaintiff's predecessors acquired record title) when one of plaintiff's predecessors in interest, MRA of NY, cleared a ten-foot wide path along the property line separating the disputed parcel from lands owned by the Mackinac Island State Park Commission and erected a barbed wire fence thereon. The area around the fence was annually cleared of brush. A picnic site was also cleared which MRA used several times annually for its own picnics, each attended by 50 to 70 persons. An MRA employee testified by deposition that he asked picnicking trespassers to leave on several different occasions. "No trespassing" signs were posted on the fence. Students of Mackinac College, also one of plaintiff's predecessors in interest, used the disputed parcel for cross-country skiing starting in 1966 or 1967.

Plaintiff and its predecessors also paid property taxes on 100 percent of the parcel. An attorney for MRA of NY testified that, although MRA received some tax statements showing that it owned only 22/63 of the disputed parcel, tax officials told MRA to ignore the fraction and taxed MRA as a 100 percent owner. After conducting a title search, MRA uncovered information indicating that the State had record title to an undivided portion of the parcel. Its attorney advised MRA at that time to erect the barbed wire fence and not to contact the State with regard to its record title interest in the property in the belief that a State claim would not be valid. Plaintiff and its predecessors continued to pay 100 percent of the property taxes on the parcel until approximately 1980 when plaintiff informed the appeals board of the local taxing In 1964, after considerable bargaining, the State acquired from MRA an avigation easement over the disputed parcel in connection with the construction of the Mackinac Island Airport. During negotiations, the State apparently did not assert or discuss its ownership interest in the parcel. As a result of defoliation of the property caused by the State in creating the easement, a washout occurred which damaged the land. After MRA threatened a lawsuit and following further negotiations, defendant State reached a settlement with MRA and paid restitution for the damaged land. Again, the State's ownership interest was not mentioned nor, apparently, was the amount of damages reduced by a proportion equal to the State's interest in the land.

authority that the State claimed a portion of the disputed parcel. By this time, if plaintiff were permitted to claim title by adverse possession, such a claim had already ripened.

Defendant State's use of the disputed parcel consisted of its maintenance of a state road which traversed the entire island near the shoreline and cut though the disputed parcel and maintenance of a picnic site next to the road in an area known as "Brown's Brook". The park was described as being smaller than the trial courtroom and contained one picnic table and a barbecue grill. Maintenance by the State included, at least since 1956, clearing brush and resetting stones at the park.

At the close of proofs, the trial court concluded that plaintiff had established by clear and positive proof the essential elements of adverse possession. In its opinion, the trial court concluded that the State had actual notice of plaintiff's claim to the disputed parcel since at least 1959, based upon the fact that plaintiff's predecessor in title, MRA of NY, had installed a fence; that two monuments placed in the ground by the State along one boundary of the disputed parcel indicated the boundary to lie between private land and state park property; and that the State had failed to assert its interest in the disputed parcel during negotiations concerning the avigation easement and damages caused to the parcel as the result of the washout.

The trial court also concluded that, even if the State did not have actual notice of plaintiff's claim to the disputed parcel, plaintiff had established that it had openly, notoriously, visibly, exclusively and hostilely possessed the parcel in such a manner as to raise a presumption of knowledge by the State based upon the testimony indicating that MRA had: installed and maintained the fence; established a picnic site; informed unauthorized persons that they were trespassing on private property; and paid property taxes as the 100 percent owner of the disputed parcel. The trial court also recognized that one cotenant could hold property adversely to another and pointed out that the record was devoid of any evidence indicating that the State had exercised any concurrent rights of possession in the disputed parcel. The trial court further recognized that a private party could adversely possess against the State pursuant to Caywood v. Dep't of Natural Resources, 71 Mich.App. 322, 248 N.W.2d 253 (1976).

The trial court's ruling did not effectively award the road or the Brown's Brook picnic area to plaintiff for, as plaintiff indicated at trial, plaintiff made no claim of title to the state road or to the attached picnic area.

On appeal, defendant State argues that the trial court erred in finding that plaintiff had adversely possessed the property sufficiently to acquire full title and in ruling that plaintiff, a private party, could adversely possess against the State. We disagree and affirm.

I

Defendant State argues that its maintenance of the state road and Brown's Brook picnic site negate plaintiff's claim of exclusive possession. In fact, argues defendant, both parties made similar use of the property. Nor did the actions of the local taxing authority or the placement of boundary markers show adverse possession by plaintiff, according to defendant. Furthermore, it is contended, defendant's failure to mention The general test for establishing adverse possession was described by this Court in Caywood, supra, pp. 331-332, 248 N.W.2d 253;

its interest in the propety during negotiations for the avigation easement and the washout damages was irrelevant to the adverse possession issue since defendant was under no duty to communicate its interest to plaintiff and only a small part of the parcel was involved in those negotiations. Therefore, given the added burden placed upon plaintiff by [132 Mich.App. 512]...