Quarter Circle JP Ranch, LLC v. Jerde

• Decision Date: 03 April 2018
• Docket Number: DA 17-0223
• Citation: 2018 MT 68,414 P.3d 1277,391 Mont. 104
• Parties: QUARTER CIRCLE JP RANCH, LLC; Wally Papez and Aretta Papez, Plaintiffs and Appellants, v. Barbara JERDE, Defendant, Appellee and Cross-Appellant.
• Court: Montana Supreme Court

391 Mont. 104

414 P.3d 1277

2018 MT 68

QUARTER CIRCLE JP RANCH, LLC; Wally Papez and Aretta Papez, Plaintiffs and Appellants,

v.Barbara JERDE, Defendant, Appellee and Cross-Appellant.

DA 17-0223

Supreme Court of Montana.

Submitted on Briefs: January 24, 2018

Decided: April 3, 2018

For Appellant: Jacqueline R. Papez, Lee Bruner, Doney Crowley, P.C., Helena, Montana

For Appellee: Daniel G. Gillispie, Attorney at Law, Billings, Montana

Justice Jim Rice delivered the Opinion of the Court.

¶ 1 Wally Papez, Aretta Papez and Quarter Circle JP Ranch, LLC (collectively "Quarter Circle") appeal from the February 2, 2017 Order on Cross Motions for Partial Summary Judgment and the June 10, 2016 Order on Plaintiffs' Motion for Summary Adjudication entered by the Twenty-Second Judicial District Court, Carbon County. Barbara Jerde cross-appeals. We affirm in part and reverse in part, addressing the following issues:

1. Did the District Court err by concluding a road easement "for the purpose of conducting farming and ranching operations and activities" was specific in nature and unambiguously included residential use?

2. Did the District Court err by concluding the easement did not also provide access to adjacent after-acquired property?

3. Did the District Court err by denying joinder of the owner of the after-acquired property to the litigation?

FACTUAL AND PROCEDURAL BACKGROUND

¶ 2 In 1988, John Papez, James and Phyllis Hoskin, Lorraine Lindblad, and Clifford Helt entered a "Mutual Grant of Access Easement," wherein they, as "Grantors–Grantees," granted access over an "existing trail or roadway," as follows:

A non-exclusive access easement over and across the above-described lands on the existing trail or roadway for ingress and egress to and from adjoining properties owned by the respective Grantors/Grantees for the purpose of conducting farming and ranching operations and activities , together with the right to repair and maintain the same in the condition it now exists at each party's own respective cost and expense, and to provide access to the parties hereto along this existing trail running from N1/2S1/2, Sec. 33-6S-22E, M.P.M., to the county road running along the South side of Sec. 9-7S-22E, M.P.M. [Emphasis added.]

Quarter Circle is the successor-in-interest to the properties previously owned by John Papez and James and Phillis Hoskin (Papez Property). Jerde is successor-in-interest to the property previously owned by Lorraine Lindblad (Jerde Record Property). Jerde also purports to be an unrecorded contract purchaser of other real property abutting the Jerde Record Property (Jerde Contract Property). The Papez Property and the Jerde Record Property are burdened and benefitted, respectively, by the easement. The Jerde Contract Property was not owned by any party to the access easement at the time of execution in 1988.

¶ 3 In 2009, Jerde moved a fifth-wheel trailer onto the Jerde Record Property and began using it as a residence. She also constructed a shed and kept horses on the property. When the trail/roadway became difficult to use, Jerde departed from the road and traveled across other land owned by Quarter Circle. Jerde also used the road to access the Jerde Contract Property.

¶ 4 Quarter Circle filed a complaint, seeking declaratory relief that Jerde, in Counts I-III: (1) improperly deviated from the easement onto Quarter Circle's unburdened property; (2) used the easement to access certain property not benefitted by the easement; and (3) used the easement for residential purposes that were not contemplated by the easement. Quarter Circle sought summary judgment, and on June 10, 2016, the District Court granted the motion on Count I. Jerde acknowledged deviating from the trail/road subject to the easement when it became impassible or flooded, and the District Court concluded that the language of the easement unambiguously limited Jerde's passage to the trail/road alone, and not over Quarter Circle's other land. The District Court also granted summary judgment to Quarter Circle on Count II, concluding the language of the easement unambiguously granted access to the trail/road only "to and from adjoining properties owned by the respective Grantors/Grantees," and thus Jerde's use of the easement to access the Jerde Contract Property, which was not owned by any of the original grantors or grantees at the time of the grant, was prohibited. The District Court denied summary judgment as to Count III, reasoning that:

[T]here is a material issue of fact relative to whether the scope of the Easement for ‘farming and ranching operations and activities' properly includes residential purposes. The record is not entirely clear as to how the Easement has been historically used, whether the original grantors/grantees contemplated use of the Easement for residential purposes related to farming and ranching, and whether Jerde's use of the Easement is incompatible with the purposes established in the grant of the Easement ... [T]he Court finds it prudent to allow the parties to clarify for the Court whether the original parties to the Easement contemplated the use of the road/trial for residential purposes related to farming and ranching on the Jerde Record Property [Emphasis added.]

¶ 5 After further record development, the parties both filed motions for summary judgment, supported by affidavits. On February 2, 2017, the District Court granted summary judgment to Jerde on Count III, concluding the language in the easement granting access for "the purpose of conducting farming and ranching operations and activities" was specific in nature and "clear and unambiguous as to its scope," and that it included residential use. In support of its conclusion, the District Court referenced dictionary definitions, including the definition of a "farm" as "[l]and and connected buildings used for agricultural purposes" (citing Black's Law Dictionary 638 (8th Ed. 2004) ). The court also provided its observations of customary use and practice on such properties, stating that, "[i]n Montana, it is frequently necessary or desirable for farmers or ranchers to have residences on their farms or ranches that are an integral part of their farming or ranching operations[,]" and noting that such a residence is commonly described as a "farm house" or "ranch house." The District Court reasoned that "the dictionary definition of ‘farm’ together with the often practical necessity for a farmer or rancher to physically reside near the other operations of the farm or ranch, establish that a farm or ranch house is, in many instances, a necessary and accepted part of ‘farming and ranching operations and activities,’ " and thus concluded that the language of the easement unambiguously included a residence. Quarter Circle appeals this issue.

¶ 6 In response to Count II of the complaint, Jerde sought to establish that the easement included use of the trail/road to access the after-acquired Jerde Contract Property. She moved for joinder of Donna Riley, the record owner of this property, arguing that the easement claims could not be properly adjudicated without Riley. The District Court denied the motion, reasoning that Riley was not a party to or successor-in-interest to the easement, and thus had no interest in the litigation. The District Court thereafter granted summary judgment to Quarter Circle on Count II, holding that the easement unambiguously limited the access grant to the 1988 signatories, and the grant was not intended to benefit the contiguous properties of those who owned property along the easement. Jerde cross-appeals the court's disposition of Count II, including the denial of joinder of Riley.

STANDARD OF REVIEW

¶ 7 We review de novo a district court's grant or denial of summary judgment, applying the same criteria of M. R. Civ. P. 56 as a district court. Pilgeram v. GreenPoint Mortg. Funding, Inc. , 2013 MT 354, ¶ 9, 373 Mont. 1, 313 P.3d 839. Summary judgment is appropriate when the moving party demonstrates both the absence of any genuine issues of material fact and entitlement to judgment as a matter of law. M. R. Civ. P. 56(c)(3) ; Bird v. Cascade Cnty. , 2016 MT 345, ¶ 9, 386 Mont. 69, 386 P.3d 602. We review a district court's conclusions of law to determine whether they are correct. Pilgeram , ¶ 9.

DISCUSSION

¶ 8 1. Did the District Court err by concluding a road easement "for the purpose of conducting farming and ranching operations and activities" was specific in nature and unambiguously included residential use?

¶ 9 Quarter Circle argues that, by initially determining that there was a material question of fact regarding the scope of the easement, and soliciting evidence to establish the original intent of the grantors/grantees, the District Court implicitly found the easement was general in nature. Quarter Circle argues that the District Court erred by later concluding that the easement was specific, or "clear and unambiguous as to its scope," and ignoring the evidence of historic use, the parties' intent, and the circumstances surrounding the easement at its inception. Quarter Circle argues neither the language of the easement nor the evidence of historical use contemplates residential use of Jerde's property. In answer, Jerde argues the District Court did not err because a grant of access for "farming and ranching operations and activities" unambiguously includes residential use, noting that the dictionary definition of "farm" encompasses "a very broad swath of activity, including residing on the farm or ranch property." Jerde avers in her affidavit that the property had previously been used for residential purposes, and argues that farming and ranching "necessarily includes the right to live on the property because it is so essential to the successful operation of a ranch."

¶ 10 "Where an easement is specific in nature, the breadth and scope of the easement are strictly determined by the actual terms of the grant." Mason v. Garrison , 2000 MT 78, ¶ 21, ...