Sells v. Robinson, 30700.

• Citation: 118 P.3d 99,141 Idaho 767
• Decision Date: 24 August 2005
• Docket Number: No. 30700.,30700.
• Parties: Claude E. SELLS, Jr. and Sally J. Sells, husband and wife, individually and as Trustees of the Claude E. Sells, Jr. Revocable Trust U.D.T. 9-23-92 and the Sally J. Sells Revocable Trust U.D.T. 9-23-92, Plaintiffs-Respondents, v. Gary ROBINSON, individually and in his capacity as Trustee, Defendant-Appellant.
• Court: United States State Supreme Court of Idaho

118 P.3d 99

141 Idaho 767

Claude E. SELLS, Jr. and Sally J. Sells, husband and wife, individually and as Trustees of the Claude E. Sells, Jr. Revocable Trust U.D.T. 9-23-92 and the Sally J. Sells Revocable Trust U.D.T. 9-23-92, Plaintiffs-Respondents, v. Gary ROBINSON, individually and in his capacity as Trustee, Defendant-Appellant.

No. 30700.

Supreme Court of Idaho, Boise, April 2005 Term.

July 1, 2005.

Rehearing Denied August 24, 2005.

COPYRIGHT MATERIAL OMITTED

Arthur M. Bistline, Coeur d'Alene, for appellant. Arthur M. Bistline argued.

Lamanna Law Office, Priest River, for respondents. Nicholas M. Lamanna argued.

SCHROEDER, Chief Justice.

Claude and Sally Sells (Sells) made claims against Gary Robinson (Robinson) for timber trespass, conversion and damages. Robinson asserted that he had a contractual right to the timber on the Sells' property. The district court ruled in favor of the Sells and awarded them treble damages for the timber trespass, other damages, costs and attorney fees. Robinson appealed.

I. FACTUAL AND PROCEDURAL BACKGROUND

In 1993 the Sells purchased about fifty acres of property in Bonner County, Idaho, several miles north of Priest River. The Sells sold a portion of the property to Mr. Milliron (Milliron), their neighbor. In 1995, the Sells wished to sell an additional twenty acres of the property and listed the property with real estate broker Marte Cliff (Cliff). The Sells would retain their home and ten acres to the north of the parcel being sold. All of the property owned by the Sells at the time had growing merchantable timber. At the time the Sells listed their property they wished to include a timber clause which would provide that no logging could occur on the twenty acres until all payments for the property had been made. The timber clause would provide the Sells with some security in the form of the value of the timber in the event the buyer defaulted.

Around August of 1996, Robinson was traveling through Idaho, Montana and Wyoming in search of property. Robinson met with Ron Hager, a real estate salesperson from Clark Fork, Idaho. Robinson testified that he, his father, Hager and Cliff met at the Sells' twenty-acre parcel. Robinson believed the Sells were asking too much for the property. Robinson wanted recreational rights for the creek running through the Sells' ten acres that were not for sale. In addition, Robinson wanted to widen the access road across the Sells' property to the twenty-acre parcel.

On August 26, 1996, the Sells and Robinson signed a Real Estate Purchase and Sale Agreement (REPSA). Section 5 of the REPSA set forth additional terms and/or conditions for the agreement, which were drafted by Robinson's real estate agent. These terms were:

1) Seller to supply $2,000.00 as a part of the down payment at closing. 2) Seller to grant an all inclusive easement on that portion of Sellers' remaining land located north and west of the northeast corner of parcel being sold. 3) Timber rights on said easement are also included. 4) Seller agrees to share water rights from creek with buyer as prescribed [sic] dictates according to Sellers' water rights. Buyer shall be responsible to file for (illegible) rights (emphasis added).

Three days later, on August 29, 1996 the Sells executed a warranty deed to convey the twenty acres to Robinson. The legal description for the warranty deed described the easement Robinson was granted over the Sells' remaining ten acres as follows:

ALSO TOGETHER WITH an easement over and across a portion of the remaining lands of the grantors lying North of the above described tract and West of the Northerly extension of the East line of said tract for the purpose of ingress, egress access to the existing creek, recreational and for removal of the timber located thereon (emphasis added).

Robinson interpreted both the REPSA and the Warranty Deed as granting him timber rights on the Sells' ten acres. In the summer of 1997 Robinson hired a logger, Mark Day (Day), to log his twenty acres and the Sells' ten acres. Day logged the property in the winter and spring of 1998. He testified that approximately thirty percent of the total timber logged was from the Sells' property. The Sells were in Arizona at the time. When they returned, they were surprised to find their ten acres had been logged. The Sells believed that the Warranty Deed granted Robinson timber rights on only the easement over their property that had been granted to Robinson in order to access his twenty acres.

The Sells sued Robinson for timber trespass, conversion and damages to their property. They requested costs and attorney fees. Robinson responded that he had a contractual right to the timber on the Sells' property. The case was tried to the court without a jury.

Robinson presented two witnesses in support of his position that he had a right to log the Sells' property. One was Robinson's cousin and the other was Hager, Robinson's real estate agent. Hager testified that the Sells' intended to give Robinson logging rights. Hager also testified that he drafted the language in the REPSA relating to timber rights. However, the district judge noted that Hager did not recall many of the events surrounding the transaction and that his testimony conflicted with the testimony of other witnesses. The district judge pointed out that both Hager and Robinson testified on cross-examination that no discussion took place among the parties about the volume of timber on the Sells' property, how much timber was to be removed, or the value of the timber.

The Sells testified that they gave Robinson the right to remove trees only from the access road for the purposes of widening that road. That is, if Robinson needed to remove trees from the road in order to widen or otherwise improve it, he was entitled to the market value of the timber removed. The Sells testified that they granted Robinson a recreational easement over their property and water rights from the creek through their parcel to Robinson's property, but that was all. They testified that they had previously declined the sale of the timber rights to their property to others. The district judge noted the timber clause in the listing agreement and that the Sells believed Robinson when he said he wanted to keep the trees on the property.

Cliff testified on behalf of the Sells that the purchase price Robinson paid for the property was reasonable. The price would have been unreasonably low if it had included the timber rights to the Sells' property. The district judge noted that by the time of trial, all of the witnesses had trouble recalling the transaction and the Sells' witnesses' testimony was very different from Robinson's witnesses' testimony. The district judge concluded that the language in the deed relating to timber was ambiguous. The district judge rejected Robinson's interpretation of the agreement finding that Robinson's "version does not have the ring of truth." The district court determined that the parties did not intend for Robinson to have timber rights to the Sells' property.

The district court determined that the total value of merchantable timber removed from both Robinson's and the Sells' property was $34,595.50 and that at least thirty percent of the timber came from the Sells' property. The district court held that the value of the timber taken from the Sells' property was $10,378.65. Further, the Sells' property value was decreased by $10,000.00, or $1,000.00 per acre, due to Robinson's logging activities.

The district court applied the doctrine of merger, finding that the REPSA was merged into the deed and, therefore, only the terms of the deed would be considered. The district court held that Robinson had no right to the timber on the Sells' property and held Robinson liable for timber trespass under I.C. § 6-602, as well as damages to the Sells' property. The district court awarded the Sells costs and attorney fees. Robinson appealed.

II. STANDARD OF REVIEW

Application of the doctrine of merger in a particular case appears to be a mixed question of law and fact. Sainsbury Constr. Co., Inc. v. Quinn, 137 Idaho 269, 273, 47 P.3d 772, 776 (Ct.App.2002) (reviewing district court's application of the doctrine of merger to the facts of the case and finding that "[u]pon independent review of the record, there was substantial and competent evidence to support the district court's findings of fact and that the district court correctly applied the law based on those findings."). In reviewing mixed questions of law and fact, "this Court will differentiate among the fact-finding, law-stating, and law-applying functions of the trial courts." Haight v. Dales Used Cars, Inc., 139 Idaho 853, 855, 87 P.3d 962, 964 (Ct.App.2003). Findings of fact made by the district court will be upheld where they are supported by substantial and competent evidence in the record. Id. This Court freely reviews a district court's application of law to its findings of facts. Id.

III.

THERE WAS NO ERROR IN APPLYING THE DOCTRINE OF MERGER TO THE REPSA AND THE DEED IN THIS CASE; HOWEVER, BOTH INSTRUMENTS ARE AMBIGUOUS.

Robinson argues that the doctrine of merger does not apply in this case for two reasons: 1) merger does not occur where the deed is ambiguous and 2) an exception to merger exists where an agreement is collateral to the deed. In Jolley v. Idaho Sec., Inc., 90 Idaho 373, 414 P.2d 879 (1966), this Court defined the doctrine of merger as follows:

[T]he acceptance of a deed to premises generally is considered as a merger of the agreements of an antecedent contract into the terms of the deed, and any claim for relief must be based on the covenants or agreements contained in the deed, not the covenants or agreements as contained in the prior agreement. Id. at 382, 414 P.2d at 884.

The Court recognized that an exception to merger exists, "where under the contract the rights are conferred collaterally and independent of the deed;...