Vandeleigh Industries v. Storage Partners

• Decision Date: 02 June 2006
• Docket Number: No. 373, 2005.,373, 2005.
• Citation: 901 A.2d 91
• Court: United States State Supreme Court of Delaware
• Parties: VANDELEIGH INDUSTRIES, LLC a Delaware Limited Liability Company, Plaintiff Below Appellant, v. STORAGE PARTNERS OF KIRKWOOD, LLC a Delaware Limited Liability Company and United Stor-All Centers, LLC a Delaware Limited Liability Company, Defendants Below Appellees.

Page 91

901 A.2d 91

VANDELEIGH INDUSTRIES, LLC a Delaware Limited Liability Company, Plaintiff Below Appellant, v. STORAGE PARTNERS OF KIRKWOOD, LLC a Delaware Limited Liability Company and United Stor-All Centers, LLC a Delaware Limited Liability Company, Defendants Below Appellees.

No. 373, 2005.

Supreme Court of Delaware.

Submitted: April 17, 2006.

Decided: June 2, 2006.

Court Below: Court of Chancery of the State of Delaware in and for New Castle County, C.A. No. 19605-NC.

Upon appeal from the Court of Chancery.

AFFIRMED

and

REMANDED.

Thomas C. Marconi, Losco & Marconi, P.A., Wilmington, DE, for appellant.

Michael F. Bonkowski (argued) and David J. Falcone, Saul Ewing, L.L.P., Wilmington, DE, for appellees.

Before STEELE, Chief Justice, HOLLAND, BERGER, JACOBS and RIDGELY, constituting the court en banc.

STEELE, Chief Justice:

In 2002, the defendant-appellee, Storage Partners, began construction of several improvements in an area on its own property that was subject to an easement for ingress and egress in favor of the adjoining property owner, Vandeleigh Industries, the plaintiff-appellant. Vandeleigh was not currently using the easement, nor did it have plans to do so in the future. Upon determining that Storage Partners planned to begin construction in the easement, Vandeleigh sought a preliminary injunction in the Court of Chancery to prevent Storage Partners from constructing the improvements. Finding no risk of imminent harm, the Vice Chancellor denied a preliminary injunction. On cross-motions for summary judgment, the Vice Chancellor determined that Vandeleigh had a valid easement for ingress and egress over a portion of Storage Partner's property and that the improvements were located within the easement. The Vice Chancellor, however, did not order Storage Partners to remove the improvements. Instead, after balancing the equities, the Vice Chancellor entered an Order that required Storage Partners to remove the improvements obstructing Vandeleigh's easement when Vandeleigh could demonstrate an imminent and viable use for the easement. Vandeleigh appeals from the Vice Chancellor's Order, claiming that the Vice Chancellor should have ordered Storage Partners to remove the obstructions altogether. We affirm, but remand to allow the Vice Chancellor to revise and clarify his Order in a manner consistent with this Opinion.

FACT AND PROCEDURAL HISTORY

The plaintiff-appellant here, Vandeleigh Industries, LLC, owns the parcel of land and premises at 3730 Kirkwood Highway, Wilmington, Delaware. Vandeleigh currently operates a Rita's Water Ice franchise on that property. The first appellee-defendant, Storage Partners of Kirkwood, LLC, owns the land and premises at 3800 Kirkwood Highway. The second appellee-defendant, United Stor-All Centers, LLC, leases the Storage Partners' property and operates an eight-building self-storage facility thereon.¹

The Vandeleigh property is approximately .25 acres in size and is bounded to the north by Kirkwood highway, which runs from west to east. The bulk of the Storage Partners' property, which is about 5.6 acres in size, is set back from Kirkwood Highway by about 653 feet. A narrow strip of the Storage Partners' property (the "easement"), approximately 24 feet wide and 161 feet long totaling .88 acres, connects the rear portion of the Storage Partners' property to Kirkwood Highway. This narrow strip of the Storage Partners property adjoins the Vandeleigh property at the southern and western boundaries of the Vandeleigh property. Property that is owned by a third party, which is used to operate a Dunkin' Donuts, lies directly west and adjoins the narrow strip of the Storage Partners' property.

Vandeleigh took title to the Vandeleigh property in September 2000 from Kirk Partners, LLC. Except for the deed to Storage Partners from Storage Partners' immediate predecessor in title, every deed in the chain of title from Vandeleigh back to the original owner, and from Storage Partners back to the same original owner of the property, included a specific reference to a nonexclusive² easement for "ingress and egress" benefiting the Vandeleigh property and burdening the .88 acre strip of the Storage Partners' property.

In 2002, United Stor-All began construction of the eight-building self-storage facility it now operates on the Storage Partners' property. As part of the construction, United Stor-All installed a 155 linear foot mesa retaining wall that extends to approximately the centerline of the easement, and allowed the Dunkin' Donuts' Property to expand its parking lot within the easement. United Stor-All clearly knew of the easement's record existence, as the easement was shown on United Stor-All's development plan as an "ingress & egress easement" with specific reference to the deed identifying the source of the easement.

Before the Defendants began construction of the retaining wall or parking spaces in the easement area, Vandeleigh informed Storage Partners that it had rights in the easement, and that it objected to any interference with the easement. Jason Yancoski, Vandeleigh's president, contacted a Storage Partners' representative and requested that Storage Partners not interfere with Vandeleigh's rights in the easement. The Storage Partners' representative responded, in essence, that the easement no longer existed, or was otherwise invalid, and that Storage Partners would continue with their plan to build improvements in the easement area.³

On April 16, 2002, counsel for Vandeleigh sent a letter to counsel for Storage Partners requesting that Storage Partners enter into the "nondisturbance agreement" that was enclosed with the letter. The proposed nondisturbance agreement provided that Storage Partners would refrain from constructing the retaining wall or otherwise encroaching on the easement in exchange for Vandeleigh not filing suit seeking a preliminary injunction or temporary restraining order. The purpose of the agreement was to preserve the status quo ante to enable the parties to attempt "to resolve their differences short of litigation." Storage Partners did not respond to the letter.

Having received no response, on May 6, 2002, Vandeleigh filed a complaint in the Court of Chancery seeking a declaratory judgment to determine whether Vandeleigh had rights in the easement; and, in the event that the Court determined that Vandeleigh had rights in the easement, seeking a preliminary and permanent injunction to prevent Storage Partners and United Stor-All from constructing the retaining wall or otherwise interfering with Vandeleigh's rights in the easement. On May 23, 2002, the Vice Chancellor held a conference call with the parties to address Vandeleigh's request for expedited treatment and a preliminary injunction. Counsel for Vandeleigh informed the Vice Chancellor that the only reason for the request for expedited treatment was that Storage Partners "may be in the process of constructing the wall" in the easement. Counsel also informed the Vice Chancellor that Vandeleigh was not currently using the easement. The Vice Chancellor denied the preliminary injunction because there was no risk of imminent harm to Vandeleigh.

Although the Vice Chancellor decided not to issue a preliminary injunction, he concluded that it made "perfect sense for [Vandeleigh] to have filed and ... to have sought expedited relief .... Nobody can accuse you of sleeping on [your rights] for an extended period of time." He also warned Storage Partners' counsel, that, "if you client goes forward with construction and I determine down the road that the construction was improperly done in the easement, then the value of that property goes up.... [I]f there is construction in that easement and it turns out that [Storage Partners] didn't have the right to construct in that easement, they're going forward at their own peril."

On January 2, 2003, Storage Partners filed a Motion for Summary judgment. Storage Partners primarily argued that the easement only granted pedestrian access from the Vandeleigh parcel to the adjacent Dunkin' Donuts parcel. Storage Partners also argued that, assuming the easement did grant vehicles the right to access the Vandeleigh property from Kirkwood Highway, that the goal of the easement was "impossible to accomplish." In support of this argument, Storage Partners presented an affidavit from Drew Boyce, a subdivision Engineer at DelDOT. Boyce stated that it was unlikely that DelDOT would approve a curb cut or entrance permit to connect the easement to Kirkwood Highway because of the close proximity that the curb cut would have to the Dunkin' Donuts' exit driveway. Boyce also stated that as of January 2003, Vandeleigh had not submitted an access application for DelDOT review.

On March 3, 2003, Vandeleigh filed a cross-motion for summary judgment arguing that the retaining wall and the parking spaces encroached upon the easement and should be removed, and that the defendants failed to show that the easement was extinguished or the purposes of the easement were "impossible to accomplish." At a summary judgment hearing on June 16, 2003, after hearing arguments from both sides, the Vice Chancellor granted Vandeleigh's motion for summary judgment and denied Storage Partners' motion for summary judgment. He concluded that the "ingress and egress" easement was a "means of access from the Vandeleigh parcel to the public road or to any other adjacent property. . . . [A]s a matter of law . . . Vandeleigh holds an easement across the easement area. Such easement is not limited to pedestrian traffic, and it is available for vehicular traffic to the Kirkwood Highway." Having determined that Vandeleigh has a right to the easement, the Vice Chancellor then explored the appropriate remedy:

The record before me is not as clear as I would like it to be before I consider the question of whether the improvements ought to be removed. On the one hand, we have what I...