August 23, 2019

Colorado Court of Appeals: Putative Adverse Possessor’s Property Rights are Superior to Everyone Else’s Except Actual Owner

The Colorado Court of Appeals issued its opinion in Lensky v. DiDomenico on Thursday, June 16, 2016.

Adverse Possession—Quiet Title—Putative Adverse Possessor.

In 1998, Lensky purchased a one-acre parcel of property from the Valdezes. Title insurance could not be provided because all of the structures and improvements that Lensky had purchased from the Valdezes were “off the deed” and actually located on adjacent land rather than on the deeded property. In 2001, Lensky filed a quiet title action, claiming fee simple ownership to the approximately 23 acres adjacent to the property he had purchased from the Valdezes by adverse possession. Litigation continued for a number of years. The trial court ultimately found in favor of defendants and ordered Lensky to remove certain structures that restricted access to the subject property. It further ordered Lensky and his associates to refrain from confronting defendants as they entered or left the subject property.

On appeal, Lensky contended that the trial court erred in finding that he had no rights as a putative adverse possessor. He argued that the Court of Appeals’ prior decision affirming his lack of legal title to the subject property fully adjudicated his prior claim to the property as an adverse possessor, but that it had no prospective effect. He also argued that his continued possession of the subject property as a putative adverse possessor gives him an interest in the property (including the right to restrict access to it) that is superior to everyone else’s interest except that of the rightful owner. The Court agreed, determining that neither the trial court’s prior order nor the division’s decision upholding that order addressed the parties’ possessory rights or Lensky’s ongoing right to possess the property, and neither prohibited him from continuing to attempt to adversely possess the property.

The trial court’s order prohibiting Lensky from excluding defendants from the subject property was reversed.

Summary provided courtesy of The Colorado Lawyer.

Frederick Skillern: Real Estate Case Law — Easements and Public Roads (2)

Editor’s note: This is Part 11 of a series of posts in which Denver-area real estate attorney Frederick Skillern provides summaries of case law pertinent to real estate practitioners (click here for previous posts). These updates originally appeared as materials for the 32nd Annual Real Estate Symposium in July 2014.

By Frederick B. Skillernfrederick-b-skillern

Maralex Resources, Inc. v. Chamberlain, Public Trustee of Garfield County Colo. App January 2, 2014 2014 COA 5 Oil and gas lease; prescriptive easement for access to wells; adverse or permissive use of roads; standing. Since 1996, Maralex has been a lessee under a series of federal oil and gas leases in Rio Grande County. Maralex operates and maintains various oil and gas wells located on federal land. To access the wells, Maralex and its predecessors in interest have historically used two roads crossing private property now owned by Nona Jean Powell. The Powell property is adjacent to the federal land. After issues arose between Maralex and Powell regarding use of the roads, Maralex filed a quiet title action seeking a decree that it has prescriptive easements over the roads for ingress and egress to the oil leaseholds. The trial court first found that Maralex lacked standing, as a real property lessee, to assert a prescriptive easement claim. Notwithstanding that finding, the court went on to consider the merits of the easement claims as a matter of judicial economy. It found that Maralex’s use of the roads was permissive and not adverse, and that Maralex did not establish the existence of the asserted prescriptive easements. On appeal, the court reverses the holding on standing. Citing a long string of cases, an oil and gas lessee has standing to bring a quiet title action and to enforce easement rights. One can even draw an analogy to surface cases in which use by a tenant may be tacked on to prior use by the fee owner in proving possession for the prescriptive period. The court finds sufficient evidence in the record to affirm the finding that the use by Maralex and its predecessors was permissive, not adverse. It was conceded that oil operators on the government land openly and continuously used the roads on Powell’s property for the statutory period. However, because Powell previously permitted the use, the use was not adverse. What made the use permissive? Like so many cases of this sort, we have gates on the roads, and cattle on a ranch. At one point a former owner of the Powell property gave keys to the oil company, telling a grazing tenant that he wanted to oil operation to be successful, but that he did not want his tenant’s herd to be impacted. Over the course of decades, there was all manner of evidence of a problematic nature, sufficient that the court could go either way on the “adversity” issue. The trial court resolved it like this – “By giving someone a key, it seems to the Court that the only reasonable interpretation is that ‘I want to keep people out, but not you. You have permission to use my road. Here is a key.’” The appeals court also notes that this could also be a recognition of a right of the user to access, with acquiescence by the easement claimant to blockage of use by others. The court goes along with the trial judge.   Sinclair Transportation Company d/b/a Sinclair Pipeline Company v. Sandberg Colorado Court of Appeals, June 5, 2014 2014 COA 76 Pipeline easement; assignability of easement in gross; proof of assignment of easement rights by parol evidence; abandonment. This is one in a series – one might say a family – of cases involving Sinclair’s pipeline between oil fields in Wyoming and Denver. At one point, the pipeline crosses land in Weld County, creating friction with residential development, and with owners of land such as the Sandbergs. Sinclair seeks to upgrade its pipeline from 6” to 10” according to terms of the written pipeline easement, which dates back to 1963. The easement was in favor of the original servient owner and its “successors and assigns.” In an extensive opinion, the court affirms a partial summary judgment ruling in favor of Sinclair on defenses raised by the landowners, who sought to block any expansion or to require movement of the easement in order to minimize its impact on their residential development. The first issue deals with the use of parol evidence to prove a part of Sinclair’s interest (ownership of a series of assignments from partial owners of the pipeline). The court upholds a ruling that Sinclair could prove a part of its chain of title by proving assignment of one 50 percent interest in the line through testimony of an attorney representing one of the parties to the assignment. The court holds that no statute of frauds bars oral testimony to prove of an assignment of an easement. More importantly, the court holds that an easement in gross, especially one created for commercial uses, is assignable. The court relies on the modern trend in case law and comments in the Restatement of Property (Servitudes) § 4.6(1)(c) (“a benefit in gross is freely transferable”), as well as C.R.S. § 38-30-101 (“any person . . . entitled to hold . . . any interest in real estate whatever, shall be authorized to convey the same to another”). The court cites a Utah case, Crane v. Crane, 683 P.2d 1062 (Utah 1984) which surveys the easement in gross case law as it applies to pipelines and other commercial uses. For those interested in the industry, the court goes on to discuss interpretation of the easement document in regard to how a pipeline company can expand and improve its pipeline – whether a pipeline company must “remove, then replace” or “replace, then remove.” Finally, the court holds that Sinclair’s attempt in a parallel case to condemn a way across the land in question did not effect an abandonment of its deeded easement rights. The attempt to condemn was derailed in a 2012 decision of the Colorado Supreme Court discussed in this space. Another court of appeals decision (not discussed in this outline) deals with the pipeline condemnation issues.

Frederick B. Skillern, Esq., is a director and shareholder with Montgomery Little & Soran, P.C., practicing in real estate and related litigation and appeals. He serves as an expert witness in cases dealing with real estate, professional responsibility and attorney fees, and acts as a mediator and arbitrator in real estate cases. Before joining Montgomery Little in 2003, Fred was in private practice in Denver for 6 years with Carpenter & Klatskin and for 10 years with Isaacson Rosenbaum. He served as a district judge for Colorado’s Eighteenth Judicial District from 2000 through 2002. Fred is a graduate of Dartmouth College, and received his law degree at the University of Colorado in 1976, in another day and time in which the legal job market was simply awful.

Colorado Court of Appeals: In Prescriptive Easement Case, Mere Silence is Not Proof of Permissive Use

The Colorado Court of Appeals issued its opinion in LR Smith Investments, LLC v. Butler on Thursday, December 18, 2014.

Prescriptive Easement—Quiet Title—Permissive Use.

In this prescriptive easement case, LR Smith Investments, LLC (Smith) claimed prescriptive easements for ingress and egress across two roads owned by Butler. The roads cross a ranch owned by Butler northwest of Craig in Moffat County. The trial court found that Smith and its predecessors continuously, openly, and notoriously used the roads from the mid-1950s until late 2011, when Butler dug ditches preventing access to the roads and thereby precipitated this litigation.

The trial court held that Butler did not meet her burden to overcome the presumption of adversity, and that Smith had satisfied the elements for prescriptive easements to use the roads. The court quieted title to Smith’s nonexclusive right to use the roads for ranching and agricultural purposes, to access the Smith property for hunting and guiding purposes, and for all other similar uses.

On appeal, Butler argued that the court erred in finding that Smith’s use of the road was not permissive, which would defeat Smith’s prescriptive easement claim. The trial court found that Smith’s use of the property was open and notorious for a period in excess of eighteen years. Moreover, the court’s finding that there was no agreement, explicit or implied, between the parties that established that Smith’s use of the roads was permissive was supported by the record. Mere acquiescence or silence is not proof of permissive use. Therefore, Butler did not overcome the presumption of adversity. The judgment was affirmed.

Summary and full case available here, courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Oil and Gas Lessee Had Standing to Bring Claim Because of Legally Protected Property Interest in Mineral Estate Under Lease

The Colorado Court of Appeals issued its opinion in Maralex Resources, Inc. v. Chamberlain, Public Trustee of Garfield County on Thursday, January 2, 2014.

Lessee—Oil and Gas Lease—Prescriptive Easement—Adverse Use—Quiet Title—Standing.

Since 1996, Maralex Resources, Inc. (Maralex) has been the lessee under oil and gas leases issued by the United States. Under the leases, Maralex operates and maintains various oil and gas wells located on land owned by the federal government. To access the wells, Maralex and its predecessors in interest historically have traversed two roads located on what is now Nona Jean Powell’s property, which is adjacent to the federal land. After issues arose between Maralex and Powell regarding access to the roads on Powell’s property, Maralex filed an action seeking a declaration that it is the owner, by prescription, of access easements across Powell’s property. Maralex also sought a decree quieting title for its continued use of the easements. The trial court concluded that Maralex lacked standing to assert a prescriptive easement claim. In addition, despite concluding that it lacked jurisdiction over Maralex’s claims, the court considered and resolved the merits of the suit “to promote judicial economy and to avoid multiple appeals.” The court found that Maralex’s use of the roads was permissive and not adverse, and that Maralex did not establish the existence of the asserted prescriptive easements.

On appeal, Maralex contended that the trial court erred in concluding that it lacked standing. The Court of Appeals agreed. An oil and gas lessee has a legally protected property interest in the mineral estate covered by the leases. Thus, the trial court erred in finding Maralex did not have standing to maintain its prescriptive easement claim.

Maralex also argued that the trial court erred in finding that Maralex did not establish a prescriptive easement across Powell’s property. The parties did not dispute that Maralex and its predecessors openly and continuously used the roads on Powell’s property for the statutory period. However, because Powell previously permitted the use, which included giving Maralex a key to the locked gate to enter the property, the use was not adverse, which is required to establish a prescriptive easement. The trial court’s finding that Maralex’s use was permissive was sufficiently supported by the record. The judgment was affirmed.

Summary and full case available here.