Steele v. McRaney

• Decision Date: 28 February 2003
• Citation: 855 So.2d 1114
• Parties: David F. STEELE et al. v. W.V. McRANEY, Sr., et al. Mark A. Roberts et al. v. Regions Bank et al.
• Court: Alabama Court of Civil Appeals

855 So.2d 1114

David F. STEELE et al. v. W.V. McRANEY, Sr., et al.

Mark A. Roberts et al. v. Regions Bank et al.

2011.

Court of Civil Appeals of Alabama.

February 28, 2003.

Daniel G. Blackburn of Blackburn & Conner, P.C., for David F. Steele et al.

John C. Calame of Gamble, Gamble & Calame, L.L.C., Selma, for James H. Sherer, Mark A. Roberts, Zachary M. Hutchins, John Thomas Sexton, and William D. Sudduth.

Donald R. Jones, Jr., and William R. Pringle, Montgomery, for Goodwyn, Mills & Cawood, Inc. CRAWLEY, Judge.

W.V. McRaney, Sr.; W.V. McRaney, Jr.; and Michael V. McRaney, individually and as custodian for Jillian Paige McRaney, a minor (hereinafter collectively referred to as "McRaney"), sued David F. Steele, Harvell Hines Steele, and J. Hudson Hines (hereinafter collectively referred to as "Steele"), alleging that Steele had wrongfully cut timber on property owned by McRaney.

McRaney and Steele are adjoining landowners. Steele contracted with a corporation, Hines, Steele and Steele, Inc., to cut timber on an eight-acre tract of real property that Steele thought it owned. McRaney claims that it has a deed to a portion of the eight-acre tract and that it owns the remainder of the eight-acre tract by adverse possession.

McRaney's five-count complaint alleged trespass, conversion, negligent hiring and supervision, wanton hiring and supervision, and an action to quiet title to the disputed property. Steele generally denied the allegations of the complaint and counterclaimed, also seeking to quiet title to the property. Steele filed a third-party complaint against Mark A. Roberts, James H. Sherer, Zachary M. Hutchens, John Thomas Sexton, and William D. Sudduth (hereinafter collectively referred to as "Roberts"), the grantors from whom Steele had acquired the property. Steele's third-party complaint alleged a breach by Roberts of the covenant of seisin, the covenant against encumbrances, and the covenant of quiet enjoyment.

Roberts answered Steele's third-party complaint and filed a third-party complaint against Regions Bank, Marie Hotz and John Stewart, as trustees of the Simpson Foundation (hereinafter collectively referred to as "Regions"), the grantors from whom Roberts had acquired the property it conveyed to Steele. Roberts's third-party complaint alleged the same breach-of-covenant claims against its grantor, Regions, that Steele alleged against its grantor, Roberts.

Regions filed a third-party complaint against Goodwyn, Mills & Cawood, Inc. (hereinafter referred to as "the surveyors"), alleging that the surveyors had surveyed its property in 1986, and that they had negligently included in that survey property not owned by Regions. Regions further alleged that the legal description of the property that appeared in the deeds from Regions to Roberts and from Roberts to Steele had been based on the incorrect survey.

The surveyors moved for a judgment on the pleadings, arguing that the statutory limitations period had expired on any action arising out of an alleged breach of contract or negligence in surveying the property. Regions moved for a summary judgment on the ground that Roberts's claims against it were barred by the 10year statute of limitations applicable to actions for breach of covenants in a deed. Roberts moved for a summary judgment against Steele on two grounds: (1) that the covenants contained in the statutory warranty deeds from Roberts to Steele were limited to actions "done or suffered" during the time that Roberts allegedly held title to the disputed property and, Roberts argued, it did nothing to cause a defect in the title during the time of its purported ownership; and (2) that the deeds from Roberts to Steele contained certain language disclaiming any covenants.

The trial court entered a judgment on the pleadings in favor of the surveyors because it appeared from the face of Regions' third-party complaint that the action was barred by the statute of limitations. On Steele's third-party complaint against Roberts, the trial court entered a summary judgment for Roberts. On Roberts's third-party complaint against Regions, the trial court entered a summary judgment for Regions (but on a ground other than the statute-of-limitations ground argued by Regions). On McRaney's complaint against Steele, the trial court entered a summary judgment in favor of all three Steele defendants on count 3 (alleging negligent hiring and supervision) and count 4 (alleging wanton hiring and supervision). As to counts 1 and 2 of McRaney's complaint (alleging trespass and conversion), the trial court entered a summary judgment in favor of two of the Steele defendants—David F. Steele and Harvell Hines Steele. After entry of these judgments, the following claims remained to be adjudicated by the trial court: counts 1 and 2 of McRaney's complaint against the third Steele defendant—J. Hudson Hines; count 5 of McRaney's complaint against all three Steele defendants; and Steele's counterclaim against McRaney. The last two claims both sought to quiet title to the disputed property.

The trial court entered an order making its judgments final pursuant to Rule 54(b), Ala. R. Civ. P. Steele appealed to the Alabama Supreme Court. Roberts cross-appealed. The supreme court transferred the appeals to this court pursuant to § 12-2-7(6), Ala.Code 1975.

On appeal, Steele argues (1) that the trial court erred in determining that the covenants contained in the statutory warranty deeds from Roberts to Steele were limited to defects in title that occurred during the time that Roberts allegedly held title to the disputed property, and (2) that the deeds from Roberts to Steele contained certain language disclaiming any covenants. On cross-appeal, Roberts contends that Regions' liability to Roberts is contingent on Roberts's liability to Steele. Therefore, Roberts argues, if this court reverses the summary judgment for Roberts on Steele's third-party complaint, then it must also reverse the summary judgment for Regions on Roberts's third-party complaint. Because we affirm as to the appeal, it is unnecessary to address the issue raised on the cross-appeal.

Under Rule 56(c)(3), Ala. R. Civ. P., a trial court is authorized to enter a summary judgment when there is no genuine issue of material fact and the moving party is entitled to a judgment as a matter of law. Because the pertinent facts in this case are essentially undisputed, we review the trial court's application of the law to those facts to determine whether the defendants and third-party defendants were entitled to judgments as a matter of law. See Carpenter v. Davis, 688 So.2d 256, 258 (Ala.1997). We review the trial court's judgments under a de novo standard. See Hipps v. Lauderdale County Bd. of Educ., 631 So.2d 1023, 1025 (Ala.Civ.App.1993).

I. Disputed property for which McRaney claims record title

The disputed property is that part of the northeast quarter of Section 24, Township 12 North, Range 11 East, lying north of Cedar Creek ("the northeast quarter") and the fractional northwest quarter of Section 24, Township 12 North, Range 11 East, lying north of Cedar Creek ("the northwest quarter"). McRaney has a deed to the northeast quarter; McRaney claims ownership of the northwest quarter by adverse possession. In this section we will discuss the issues that pertain to the disputed property in the northeast quarter.

It is undisputed that all deeds relevant to this appeal are statutory warranty deeds containing the words "grant, bargain, and sell."¹

"In all conveyances of estates in fee where the words `grant, bargain, and sell' appear, the deed is construed by statute as containing the following covenants of title: a covenant of seizin; a covenant against encumbrances; and a covenant of quiet enjoyment. [Ala.] Code 1975, § 35-4-271."

St. Paul Title Ins. Corp. v. Owen, 452 So.2d 482, 485 (Ala.1984). See generally Jesse P. Evans III, Alabama Property Rights and Remedies § 4.4(a)(2d ed.1998). Section 35-4-271, Ala.Code 1975, provides:

"In all conveyances of estates in fee, the words `grant,' `bargain,' `sell' or either of them, must be construed, unless it otherwise clearly appears from the conveyance, an express covenant to the grantee, his heirs and assigns, that the grantor was seised of an indefeasible estate in fee simple, free from incumbrances done or suffered by the grantor, except the rents and services that are reserved; and also for quiet enjoyment against the grantor, his heirs and assigns, unless limited by the express words of such conveyance; and the grantee, his heirs, personal representatives, and assigns may, in any action, assign breaches, as if such covenants were expressly inserted."

It is undisputed that the defect in Steele's record title was created by the erroneous legal description of the property in the deed from Regions to Roberts. The same erroneous legal description was contained in the deed from Roberts to Steele.

Relying on St. Paul Title Insurance Corp. v. Owen, supra, the trial court determined that Roberts was not liable to Steele for breach of the implied covenants listed in § 35-4-271 because the defect in the title to the property Roberts conveyed to Steele existed when Roberts acquired the property from its grantor, Regions. In Owen, a title insurance company, as subrogee of the remote grantee's mortgagee, sued the original grantor, alleging a breach of the express covenants in its warranty deed, and also sued subsequent grantors, alleging a breach of the implied covenants in their statutory warranty deed. The Alabama Supreme Court held that the title insurance company could recover from the original grantor for breach of the express covenants contained in the warranty deed, but the title insurance company could not recover from the subsequent grantors on the covenants contained in their statutory warranty deed. The court stated:

"James and Cheryl Owen [the subsequent grantors] conveyed their complete, albeit

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