Richart v. Jackson

Decision Date26 May 2000
Docket NumberNo. 98-157.,98-157.
PartiesFrank and Barbara RICHART, Fred and Nancy Seigler, James and Peggy Sharp, Mark and Claudia Pfaff, Paul and Catherine Arthaud, et al. v. Bryan S. JACKSON and Nancy F. Jenkins.
CourtVermont Supreme Court

Douglas D. Le Brun of Dinse, Knapp & McAndrew, P.C., Burlington, for Plaintiffs-Appellees.

Vincent A. Paradis and Daniel P. O'Rourke of Bergeron, Paradis & Fitzpatrick, Essex Junction, for Defendants-Appellants.

Present: AMESTOY, C.J., DOOLEY, JOHNSON and SKOGLUND, JJ., and JENKINS, Superior Judge, Specially Assigned.

SKOGLUND, J.

Defendants appeal from a summary judgment of the Chittenden Superior Court enforcing plaintiffs' right to the use and enjoyment of certain improvements located in a common beach area on defendants' property, and requiring defendants to pay a share of the insurance costs for the beach area and improvements. Defendants contend the court erred in ruling that they were bound by the terms of a Declaration of Conditions, Restrictions and Uses relating to the beach area and improvements because: (1) the failure to record the Declaration prior to the conveyance of their property to a predecessor-in-title extinguished any easements or covenants as applied to defendants; and (2) the Declaration was recorded outside defendants' chain of title. Plaintiffs have cross-appealed, contending the court erred in failing to enforce a provision in the Declaration requiring defendants to contribute to the overall maintenance costs of the beach-front improvements. We affirm in part and reverse in part.

Defendants and plaintiffs own properties located in the Town of Charlotte. All of the properties in question derive from a common grantor, J. Graham Goldsmith. In 1986, Goldsmith began to develop the property by dividing and selling lots. The first eight developed lots comprised Black Willow Farms Phase I. Because not every lot had beach access to Lake Champlain, Goldsmith granted to each Phase I lot that was sold an easement for a right-of-way leading to a common beach area on two lots he continued to own. Reference to this easement and right-of-way appeared in every deed of the Phase I lots as they were sold. The deeds provided:

Included herewith in common with others is an easement and right of way over a ten foot wide pedestrian access trail as the same is shown on the aforementioned Plan to provide access to the shores of Lake Champlain, together with the use of a 60' × 60' beach area as shown on the aforementioned Plan.

Plaintiffs are the owners of five lots in Phase I of the subdivision and members of the Black Willow Farms Homeowners Association. The use easements encumber Lots 10 and 11 of what became known as Black Willow Farms Phase II development.

In March 1987, Goldsmith and the Association executed a Declaration that subjected the access and beach area to several conditions, restrictions, and uses and recognized the Association's right to construct and maintain a ten-by-ten foot storage shed and to use, maintain, and store a fifty-foot dock. The Declaration also required the owners of Lots 10 and 11 to each pay one-tenth of the annual budget for maintenance of the area, including the purchase of general liability and indemnification insurance. For unexplained reasons, the Declaration was not recorded until March 17, 1992.

On May 10, 1991, Goldsmith conveyed Lot 11 to Barry J. Mossman, defendants' predecessor-in-interest. The 1991 warranty deed from Goldsmith to Mossman stated in part:

The within parcel is subject to and has the benefit of a pedestrian easement and right of way along the southerly boundary, in common with others, in the area generally depicted on the Plat as "10 Foot Wide Right of Way," and in the beach area on the within parcel as generally shown on the Plat.

Although the warranty deed contained the easement, no mention was made of the Declaration, and Mossman did not recall receiving a copy of the Declaration or being aware of its existence. The Association installed a dock in the beach area in the summer of 1992. Thereafter, the dock was used by residents to access boats during the summer, and was stored on land adjacent to the beach area during the winter. On May 31, 1994, Mossman conveyed Lot 11 by warranty deed to defendants. The deed contained the same easement language that was in the Goldsmith-to-Mossman deed, but again did not reference the Declaration.

A dispute arose between defendants and the Association over the applicability of provisions in the Declaration, culminating in defendants' removal of the dock from their property. Plaintiffs thereupon filed a complaint against defendants, seeking a permanent injunction prohibiting defendants from interfering with their use and enjoyment of the right-of-way, beach area, and dock. Defendants filed an answer denying plaintiffs' right to use the dock and storage area, and a counterclaim seeking to enforce certain provisions of the Declaration against plaintiffs, including the obligation to obtain general liability insurance to cover the common beach area and improvements. The parties filed cross-motions for summary judgment.

The court issued two separate decisions. In the first, it ruled in favor of plaintiffs' right to use and maintain the shed and dock in the common beach area. In the second, it ruled that defendants were obligated to pay one-tenth of the cost of insurance for the common beach area and structures thereon, but not the costs of construction and maintenance of the improvements. Plaintiffs' motion for reconsideration was subsequently denied, and these appeals followed.

In reviewing a grant of summary judgment, we apply the same standard as the trial court: summary judgment should be granted when, taking all allegations made by the nonmoving party as true, there are no genuine issues of material fact and the movant is entitled to judgment as a matter of law. See Madden v. Omega Optical, Inc., 165 Vt. 306, 309, 683 A.2d 386, 389 (1996).

Defendants contest the court's ruling that their property was subject to plaintiffs' use and enjoyment of the beach improvements. The court grounded its decision on several theories. We address only its conclusion that defendants were on inquiry notice of the improvements, as we find that ruling to be dispositive.1 Plaintiffs averred in their statement of undisputed material facts that "[a]t the time the defendants purchased the Property, a dock existed on the beach easement, and was in regular use by the owners of Black Willow Farms Phase I, including plaintiffs and their predecessors-in-title." Defendants' responsive statement disputed only the representation that the dock was in "regular use" by plaintiffs. Thus the existence of the dock at the time of defendants' purchase was admitted and uncontroverted. See V.R.C.P. 56(c)(2); Samplid Enters., Inc. v. First Vermont Bank, 165 Vt. 22, 25-26, 676 A.2d 774, 776 (1996). Based upon its finding that "the dock was in use at the time Defendants purchased the property," the court concluded that "[d]efendants should have been on inquiry notice" concerning plaintiffs' interest.

The principle of inquiry notice is a venerable one in Vermont. We have explained the concept as follows:

[T]he courts of equity are vigilant . . . to see that [a] purchaser shall not be allowed to take any benefit resulting from any want of care and watchfulness. If there exist any circumstance of suspicion, whereby he might be said to be fairly put upon his guard, and he neglects to follow out the inquiry, he is affected with notice of all facts, which such inquiry would have brought to his knowledge, and if he purchases with his eyes shut, he acquires only the title of his grantor impeded with its attendant equity.

Hart v. Farmers' & Mechanics' Bank, 33 Vt. 252, 264-65 (1860). This principle has been continually reaffirmed in Vermont and elsewhere. See, e.g., Tomasi v. Kelley, 100 Vt. 318, 323, 137 A. 196, 198-99 (1927) ("The circumstances being such as then to put defendant upon inquiry, he is...

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