Wood v. Taylor

• Decision Date: 02 December 2020
• Docket Number: A166593
• Parties: Frank H. WOOD and Peggy J. Wood, Plaintiffs-Appellants, v. Marc E. TAYLOR and Cathleen L. Claussenius, tenants by the entirety, Defendants-Respondents, and Oregon Community Credit Union, Defendant.
• Court: Oregon Court of Appeals

307 Or.App. 688

479 P.3d 560

Frank H. WOOD and Peggy J. Wood, Plaintiffs-Appellants,

v. Marc E. TAYLOR and Cathleen L. Claussenius, tenants by the entirety, Defendants-Respondents,andOregon Community Credit Union, Defendant.

A166593

Court of Appeals of Oregon.

Argued and submitted September 5, 2019.

December 2, 2020

Natalie C. Scott argued the cause for appellants. Also on the briefs was The Scott Law Group.

Thomas M. Christ argued the cause for respondents. Also on the brief was Sussman Shank LLP.

Before Armstrong, Presiding Judge, and Tookey, Judge, and Aoyagi, Judge.

AOYAGI, J.

This is a property dispute between neighbors regarding a roughly triangular area of land at the adjoining boundary of their properties. The disputed area is included in defendants’ deed, but plaintiffs claim to have acquired title to it by adverse possession. After a bench trial, the trial court dismissed plaintiffs’ claims on the ground that plaintiffs had failed to prove the requisite "honest belief" for adverse possession. Under ORS 105.620, in addition to the other elements of adverse possession, plaintiffs had to prove that, upon first entering into possession of the disputed area, they had an "honest belief" of actual ownership, which belief continued for ten years, had an objective basis, and was reasonable under the particular circumstances. Plaintiffs appeal. For the following reasons, we reverse and remand.

STANDARD OF REVIEW

Plaintiffs request de novo review on their adverse possession claim. They ask that we find the facts anew, assess the proof of each element of the claim, and conclude that plaintiffs proved adverse possession of the disputed area.

Exercising our discretion, we decline to provide complete de novo review, but we do grant limited de novo review. See ORS 19.415(3)(b) (granting us "sole discretion" whether to allow de novo review in equitable proceedings); ORAP 5.40(8)(c) (describing considerations for when we will provide de novo review). Specifically, we grant de novo review as to the "honest belief" element of plaintiffs’ adverse possession claim, while leaving it for the trial court to decide on remand whether plaintiffs proved the other elements of adverse possession—that is, actual, open, notorious, exclusive, hostile, and continuous possession for ten years. In deciding whether plaintiffs proved the requisite "honest belief," we make supplemental findings as necessary, based largely on uncontested evidence, but otherwise rely on the findings made by the trial court.

In the context of the considerations described in ORAP 5.40(8), we grant limited de novo review for two related reasons. First, although the trial court dismissed plaintiffs’ adverse possession claim on the specific basis that any honest belief that they had in 1991 was unreasonable, "honest belief" is one element with several components that must be considered together for proper interpretation. Second, given our disposition, it would make little sense to issue a decision on whether a hypothetical honest belief was reasonable. We therefore grant limited de novo review to address the "honest belief" element in its entirety, including aspects of that element that the trial court either assumed without deciding or did not address. But, as to any findings that the trial court actually made, which are supported by evidence, we adopt those findings and do not find those facts anew.

We state the facts accordingly, limiting our discussion to the facts relevant to the "honest belief" element.

FACTS

In 1991, plaintiffs bought Lot 802 in a rural residential area outside Newport. The property faces Yaquina Heights Drive, as does the neighboring lot to the west, Lot 800. It is undisputed that plaintiffs’ 1991 deed accurately described the legal boundaries of their property, with the italicized portion describing the western boundary:

"Beginning at a point on the Northerly line of the old U.S. Highway 20 location, said point being 3.50 feet North of the South quarter section corner of Section 4, Township 11 South, Range 11 West, Willamette Meridian, in Lincoln County, Oregon; thence North 217.90 feet; thence West 75 feet; then South 167.42 feet; thence South 45 deg. East 67.02 feet to said Northerly line ; thence Easterly along said Northerly line 27.78 feet to the point of beginning."

(Emphasis added.)

When plaintiffs bought Lot 802, there was a chain-link fence on the western side of the lot. The grass to the west of the fence (on the neighbor's property) was maintained, while the grass to the east of the fence was overgrown like all of the grass on Lot 802. There were also two burn barrels on the east side of the fence. Standing on the house's porch, Lot 802 looked to plaintiffs like a roughly rectangular parcel, bounded by Yaquina Heights Drive on the south, another road on the east, a fence on the north, and the chain-link fence on the west. Plaintiff Frank Wood testified at trial that it was "just a no-brainer [that] there's your property line, there's the fence." Plaintiff Peggy Wood gave similar testimony.

Plaintiffs did not have Lot 802 surveyed before they bought it, nor did they or their mortgage lender have the property appraised. The home-buying process was relatively informal in 1991. Plaintiffs never talked to their realtor or anyone else about the property lines. They did not go to the title company or assessor's office to look at a map of the property. They did not study the description in their deed. Rather, as to the western boundary, plaintiffs simply assumed that the chain-link fence marked the property line. When they bought Lot 802, plaintiffs were focused on the condition of the house and the garage and were not worried about the property lines.

From 1991 to 2014, plaintiffs used the disputed area as part of their front yard, without anyone saying anything.

In 2014, defendants bought Lot 800. They had the property surveyed and, as a result, learned that the existing chain-link fence did not run along the deeded property line, or at least not for its entire length. Starting at the northernmost point, the actual property line ran south for about three-quarters of the lot's length, and then turned southeasterly at a 45-degree angle, terminating at Yaquina Heights Drive. By contrast, the fence began on the property line, ran straight for most of the lot's length—bearing slightly but increasingly west of the property line, until, where the actual property line veered southeasterly, the fence continued straight and thus ran significantly west of the property line—until, nearing Yaquina Heights Drive, the fence curved westward to connect with defendants’ driveway gate on Lot 800. The differential between the actual property line and the fence line—i.e. , the disputed area—is depicted on Exhibit 103:

Shortly after purchasing Lot 800, defendants removed the existing chain-link fence and built a new wooden fence along the deeded property line. That event spurred plaintiffs to file this action. Plaintiffs alleged that they had acquired title to the disputed area by adverse possession, asserting claims for adverse possession, ejectment, and damages for removal of the chain-link fence. Defendants opposed plaintiffs’ claims. The parties filed cross-motions for summary judgment, which the trial court denied. The case proceeded to trial. The adverse possession claim was tried to the court, with the understanding that, if plaintiffs prevailed, the other claims would be tried to a jury.

After hearing the evidence, the trial court concluded that plaintiffs had failed to prove the "honest belief" element of adverse possession. The court stated that, after plaintiffs had owned Lot 802 and used the disputed area as part of their front yard for a few years without anyone saying anything, it was "absolutely" reasonable for them to believe that the disputed area belonged to them—and even more so after that situation continued for 20 years. The court explained, however, that the key legal question was whether plaintiffs’ belief had been reasonable "at the moment that [they] first obtained the deed and paid the money and signed the closing papers," because "that belief has to be there and be reasonable at the time that you first go onto the property as an owner."

As to what plaintiffs believed in 1991, the court seemed to express skepticism that plaintiffs’ subjective belief, as described in their testimony, qualified as an honest belief of actual ownership within the meaning of ORS 105.620 (1)(b). But the court did not rule on that basis. Instead, it focused on the reasonableness requirement, concluding that any honest belief of actual ownership that plaintiffs had in 1991 was unreasonable under the particular circumstances. In the court's view, it would be "fair" for anyone standing on Lot 802 to look at the fence and think, "This piece of property might go to that fence," but it was not reasonable to look at the fence and think, "This property does go to that fence." The court viewed the evidence as showing that plaintiffs were "somewhat careless and maybe in the negligence range, if not reckless, in not being very careful about what the property lines were when they bought."

The trial court did not address any of the other elements of adverse possession. (Plaintiffs argue that the trial court implicitly ruled in their favor on the other elements of adverse possession. Having reviewed the record, we disagree.) The court entered judgment for defendants, dismissing plaintiffs’ adverse possession claim, as well as their derivative claims for ejectment and damages. Plaintiffs appeal. In their first assignment of error, they challenge the dismissal of their adverse possession claim after trial.¹ In their second assignment of error, they challenge the related dismissal of their ejectment and damages claims.

ANALYSIS

A. General Principles (Adverse Possession)

Until 1989, adverse possession was purely a common-law claim in Oregon. To prevail at common law, the claimant had to...