Lone Jack Ranch, LP v. Perkins
Filed 3/25/13 Lone Jack Ranch, LP v. Perkins CA4/1
COURT
OF APPEAL, FOURTH APPELLATE DISTRICT
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DIVISION
ONE
STATE
OF CALIFORNIA
LONE JACK RANCH, LP,
Plaintiff, Cross-Defendant and Respondent,
v.
VIRGINIA PERKINS,
Defendant, Cross-Complainant and Appellant.
D060995
(Super. Ct.
No. GIN053365)
THE COURT:
It is ordered that the opinion
filed herein on March 1, 2013,
be modified as follows:
1. On page 14, the second sentence under the
heading "Attorney Fees on Appeal" and its accompanying legal citation
are deleted and replaced with:
On remand the trial court shall determine the
entitlement to and amount of contractual attorney fees. (Huntingdon
Life Sciences, Inc. v. Stop Huntingdon Animal Cruelty USA, Inc. (2005) 129
Cal.App.4th 1228, 1267.)
2. On page 15, the
first three sentences of the Disposition are deleted and replaced with:
The judgment is reversed. The case is remanded to the trial court for
further proceedings in accordance with this opinion. Perkins is entitled to costs on appeal.
There is no change in the judgment.
Lone Jack Ranch, LP's petition for rehearing is DENIED.
Filed 3/1/13 (Unmodified version)
California
Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or
relying on opinions not certified for publication or ordered published, except
as specified by rule 8.1115(b). This
opinion has not been certified for publication or ordered published for
purposes of rule 8.1115.
COURT
OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION
ONE
STATE
OF CALIFORNIA
LONE JACK RANCH, LP,
Plaintiff, Cross-Defendant and Respondent,
v.
VIRGINIA PERKINS,
Defendant, Cross-Complainant and Appellant.
D060995
(Super. Ct.
No. GIN053365)
APPEAL from
a judgment of the Superior Court
of San Diego County,
Timothy M. Casserly, Judge.
Reversed with directions.
This is a
dispute between adjacent property owners, Lone Jack Ranch LP (the LP) and
Virginia Perkins. The issue on appeal is
whether the trial court misinterpreted a 1981 settlement agreement between the
parties' predecessors in interest, which pertains to Perkins's access to her
property over a private road on the LP's property. We find error and reverse the judgment with
directions.
FACTUAL
AND PROCEDURAL BACKGROUND
Lone Jack
Ranch consists of approximately 15.4 acres of land. Dr. Jeffrey Moses purchased the property in
1994 from Kenneth Liberty, and he later transferred ownership to the LP. The property is improved with a man-made lake
and a home in which
Dr. Moses and his family have lived.
In the
1950's Perkins's parents, Russell and Virginia S. Perkins (the Perkinses),
purchased property that abuts Lone Jack Ranch to the north.
approximately 269 acres over parcels 1 through 6, and is undeveloped except for
a house on parcel 1. For access to the
property, the Perkinses used a private dirt road that traverses Lone Jack
Ranch.
In the late
1970's the Perkinses sought to subdivide Perkins Ranch, and the provision of
public access to the property was a prerequisite. The Perkinses sought to use a 40-foot-wide
public road, RS 181, which the County
of San Diego (the County) had
previously designated and mapped out, but not constructed, to traverse Lone
Jack Ranch. By that time, however, the
man-made lake encroached on a portion of the alignment of RS 181. The Perkinses asserted a right to drain the
lake for the construction of RS 181 and Liberty
disagreed.
In 1979 the
Perkinses sued Liberty, the County,
and the California Department of Fish and Game.
that was recorded in August 1981 and binds successors in interest. Liberty agreed not to oppose the Perkinses'
"efforts . . . to improve and utilize" RS 181, which the County was
to realign to avoid the lake; to grant the Perkinses an easement over the newly
aligned road; and to grant them and the County "all necessary temporary
easements and rights of entry" necessary for the construction of RS 181.
As a
prerequisite of recording a tentative subdivision map, the Perkinses were to
make an irrevocable offer of dedication of RS 181 to the County. They were also to "maintain[
] . . . the new alignment" of RS 181 until the County
accepted the offer of dedication.
Two
paragraphs of the 1981 settlement agreement pertain to the dirt road on Lone
Jack Ranch. Paragraph 11 provides: "RUSSELL S. and VIRGINIA S. PERKINS and
all members of their family agree to relinquish any prescriptive access rights
which they may have acquired in the dirt road which currently transverses the LIBERTY
property. The PERKINSES and all members
of their family, . . . agree not to oppose any efforts by KENNETH LIBERTY to
close, revegetate, or otherwise barricade said existing dirt road upon
RS181, it being understood that upon implementation of this Settlement
Agreement there shall be but one public roadway traversing the LIBERTY
property, namely the new alignment of RS181." (Italics added.)
Paragraph
14 provides: "Upon demand, the
PERKINSES shall quitclaim to KENNETH LIBERTY any and all interest they and
their family may have in the dirt road which currently traverses the LIBERTY
property, provided the PERKINSES shall not quitclaim any interest in such dirt
road unless and until the new alignment of RS181 as herein described
the PERKINSES." (Italics added.)
Pursuant to
the settlement agreement, in August 1981 Liberty
caused a grant of easement over RS 181 in favor of the Perkinses to be
recorded.
irrevocably offer to dedicate the easement to the County "as part of the
public road system." In turn, the
Perkinses made an irrevocable offer of dedication of the easement to the
County. In October 1981 a parcel map for
a tentative subdivision map for Perkins Ranch was approved and recorded. In December 1981 the County drew the new
alignment of RS 181 to go around the lake, and the County vacated the old
alignment.
For reasons the record does not
reveal, the Perkinses ultimately did not subdivide Perkins Ranch, and thus
public access was not required and RS 181 was not constructed. They continued to use the dirt road on Lone
Jack Ranch for access to their property, without any complaint by Liberty
or his successors in interest, Dr. Moses and his LP.
By 2002 the
Perkinses had both died and their children, Perkins, Stephen Perkins
and Georgia Havenstrite, inherited the property. In a 2005 partition action, the heirs entered
into a settlement that awarded Perkins parcels 1 and 2, and awarded Stephen
Perkins and Havenstrite each a 50 percent interest in parcels 3 through 6. Stephen Perkins and Havenstrite sold a
portion of their property to David Resnick, and he transferred some of it to
Estates Seven, LLC (Estates Seven). The
Perkins Ranch owners all used the dirt road over Lone Jack Ranch to access
their properties, initially without any objection.
In 2006 a
dispute arose between Dr. Moses and Perkins over her use of the dirt road. Perkins did not live on her property, but her
daughter sometimes did, and Perkins visited the property and maintained
it. Dr. Moses had fenced in his property
and installed an electric front gate, at the south end of the dirt road, and a
manual back gate, at the north end of the road, to keep domestic animals in and
trespassers out. He provided Perkins
with access codes to the front gate, and the combination to a padlock on the
back gate. Perkins admittedly etched or
drew the codes on the gates for her convenience and that of maintenance workers
and other invitees, and she denied Dr. Moses's numerous requests to keep the
codes private and the gates locked.
Ultimately,
the LP sued Perkins and the other owners of Perkins Ranch. The operative second amended complaint
(complaint) includes counts for declaratory relief, injunctive relief and
indemnity. The complaint alleges the
1981 settlement agreement "is confusing" and "[o]bvious
uncertainty abounds as to the scope of use, existence and the location of the
easement rights held by the dominant estate [Perkins Ranch]." (Underlining and italics omitted.) The complaint conceded the Perkins Ranch
owners had some type of access easement over Lone Jack Ranch.
Perkins
cross-complained against the LP for breach of contract, breach of the implied
covenant of good faith and fair dealing, and declaratory relief, and to quiet
title. The cross-complaint alleges the
LP breached the 1981 settlement agreement by erecting and locking gates that
restrict her access to her property. It
also alleges her parents and successors had enjoyed a prescriptive easement
through Lone Jack Ranch for several decades.
The cross-complaint sought to "quiet title to her prescriptive
easement[] rights of unfettered ingress and egress to her property" and
damages for being locked out.
In 2009 the
LP entered into a settlement with all defendants except Perkins. The settlement gives the settling defendants
the right to continue using the dirt road, and the LP the right to erect
electric gates or other access barriers on the road, provided that the settling
defendants have access at all times through remote controls or keypad numbers.
Trial
between the LP and Perkins began in October 2010. They agreed the court would first interpret
the 1981 settlement agreement, and if necessary, a jury would then consider
factual issues in Perkins's cross-complaint.
The LP argued that under paragraph 11, as soon as the County drew the
realignment for RS 181 in December 1981 the Perkinses automatically
relinquished any prescriptive easement rights they may have had in the dirt
road, and the LP was entitled to bar access; on the LP's demand Perkins was
required to quitclaim any prescriptive easement rights she may have had in the
dirt road; and the Perkinses' and their successors' use of the dirt road after
December 1981 was pursuant to a license the LP could revoke at any time.
Perkins
argued the 1981 settlement agreement was not intended to extinguish any
prescriptive easement rights of the Perkinses or their successors over the dirt
road unless RS 181 was actually constructed and the dirt road was no longer
needed for access to Perkins Ranch. She
also argued that since the agreement does not specify any time within which RS
181 had to be constructed, the passage of time has not affected her right to
that easement. The LP conceded the settlement
agreement gives Perkins a continuing right to construct a private easement in
the RS 181 realignment at any time.
The trial
court agreed with the LP's assessment and entered judgment for it. The court denied Perkins any relief on her
cross-complaint.
DISCUSSION
I
Contract Interpretation
Perkins
contends the trial court misconstrued the 1981 settlement agreement,
particularly by not considering and harmonizing its terms as a whole. We agree with this assessment.
"Settlement
agreements . . . are construed under the same rules that apply to any other
contract." (In re Tobacco Cases I (2010) 186 Cal.App.4th 42, 47.) "Interpretation of a contract, including
resolution of any ambiguity, is solely a judicial function. [Citation.]
The primary goal of contract interpretation is to give effect to the
mutual intent of the parties." (
189 Cal.App.4th 562, 598 (Villacres).) When possible, we glean the parties' intent
solely from the written provisions of the contract. (Ibid.) "Specific language must be interpreted
in context and with regard to its intended function and the structure of the
agreement as a whole." (
The interpretation of an unambiguous contract is a matter of law for
this court's independent determination.
(State Farm Fire & Casualty
Co. v. Lewis (1987) 191 Cal.App.3d 960, 963.)
The trial court relied on paragraph
11 of the 1981 settlement agreement, which provides: "RUSSELL S. and VIRGINIA S. PERKINS and
all members of their family agree to relinquish any prescriptive access rights
which they may have acquired in the dirt road which currently transverses the
LIBERTY property.[
title="">[7]] The PERKINSES and all members of their
family, their agents, employees, and anyone acting on their behalf agree not to
oppose any efforts by KENNETH LIBERTY to close, revegetate, or otherwise
barricade said existing dirt road upon
completion of the new alignment of RS181, it being understood that upon
implementation of this Settlement Agreement there shall be but one public
roadway traversing the LIBERTY property, namely the new alignment of
RS181." (Italics added.)
The court
determined the italicized language of paragraph 11 cited above refers to the
County's completion of the drawing for
the realignment for RS 181, which occurred in December 1981, rather than to the
completion of the road itself, which never occurred. Another portion of the settlement agreement,
however, shows the parties used the term "new alignment of RS 181" to
mean the completed road. Paragraph 8
provides: "The PERKINSES shall be
responsible for the maintenance of the
new alignment of RS181, including its landscaping and drainage facilities .
. ., until the irrevocable offer of dedication is made to the County and
accepted. . . ." (Italics
added.) The drawing for the realignment of RS 181, of course, would require no
maintenance, whereas a completed road and environs would. We conclude the court's finding that the 1981
settlement agreement pertains solely to the drawing of the realignment, and not
to actual construction of the road, is mistaken.
Moreover,
we must read paragraph 11 in conjunction with paragraph 14, which
provides: "Upon demand, the
PERKINSES shall quitclaim to KENNETH LIBERTY any and all interest they and
their family may have in the dirt road which currently traverses the LIBERTY
property, provided the PERKINSES shall not quitclaim any interest in such dirt
road unless and until the new alignment of RS181 as herein described is
the PERKINSES." (Italics
added.) This paragraph is not reasonably
interpreted to mean the mere drawing for
the realigned RS 181 was the relevant trigger, because a drawing could not
provide the Perkinses with access to their property. We reject the notion the contracting parties
intended that the term "ready and available for access use" meant the
newly drawn realignment of RS 181 was available to begin the lengthy, and
speculative, permitting and construction process.
The LP
acknowledges that when the 1981 settlement agreement was reached "it was
unknown . . . when (or if) the newly aligned RS181 might be built-out [
to construct the road. Rather, paragraph
1 required Liberty "not to oppose efforts" by the Perkinses to
improve RS 181. Indeed, the Perkinses
could not ensure RS 181 would be constructed because the County controlled the
matter. It is clear from the settlement
agreement that the Perkinses' interest in developing RS 181 was to provide
public access to an anticipated subdivision of their property, not an expensive
private access should the development not occur.
Under the
LP's interpretation, the contracting parties intended that even if RS 181 was
not constructed, the Perkinses would lose any
right of access over Lone Jack Ranch after the realignment of RS 181 was drawn
unless Liberty later voluntarily granted them a license to continue using the
dirt road. In our view this theory
defies common sense. Liberty and the
Perkinses were unable to resolve their differences without litigation, and it
is unlikely the Perkinses would have expected or relied on Liberty's
largesse. Even if initially granted, a
license is revocable at will, and thus Liberty would unilaterally control their
access.
The LP's
complaint alleges numerous times that the settlement agreement is unclear and
confusing. " 'Contractual language
is ambiguous if it is susceptible to more than one reasonable interpretation in
the context of the [contract] as a whole.'
[Citation.] " 'In
determining whether an ambiguity exists, a court should consider not only the
face of the contract but also any extrinsic evidence that supports a reasonable
interpretation.' " (
"If a contract is capable of two constructions courts are bound to
give such an interpretation as will make it lawful, operative, definite,
reasonable, and capable of being carried into effect, if that can be done
without violating the intention of the parties." (Rodriguez
v. Barnett (1959) 52 Cal.2d 154, 160.)
When parol evidence is not in conflict, as here, we independently
construe it. (Winet v. Price (1992) 4 Cal.App.4th 1159, 1166.)
The LP and
Perkins stipulated to the introduction of extrinsic evidence, including the
contracting parties' course of conduct after the 1981 settlement agreement was
executed. The stipulation states,
"Liberty permitted the members of the Perkins family to use the [dirt
road], without incident, after the 1981 Settlement Agreement until Lone Jack
Ranch was sold to Dr. Moses. [The LP]
and Dr. Moses permitted the members of the Perkins family to use the [dirt
road], without incident, until 2006."
The
parties' course of performance during the contract term is strong evidence of
their intent at the time of contracting.
" 'The rationale for the admission of course of performance
evidence is a practical one.
"[W]hen a contract is
ambiguous, a construction given to it by the acts and conduct of the
parties with knowledge of its terms, before any controversy has arisen as to
its meaning, is entitled to great weight, and will, when reasonable, be adopted
and enforced by the court.
[Citation.] The reason underlying
the rule is that it is the duty of the court to give effect to the intention of
the parties where it is not wholly at variance with the correct legal
interpretation of the terms of the contract and a practical construction placed
by the parties upon the instrument is the best evidence of their
intention." ' " (
Perkinses relinquish any prescriptive easement rights in the dirt road when the
realignment of RS 181 was merely drawn, it is unlikely that Liberty would have
allowed them to continue using the dirt road without any objection, through the
supposed vehicle of a revocable license.
The LP now
asserts the 1981 settlement agreement is unambiguous and the plain language of
paragraph 11 supports the court's ruling.
We need not determine whether the agreement is ambiguous, however,
because we disagree with the court's ruling under any analysis. Whether or not we consider the extrinsic
evidence, the agreement is not reasonably interpreted to deprive the Perkinses,
or their successors, of any prescriptive rights in the dirt road over Lone Jack
Ranch on the mere drawing of the realignment of RS 181.
The 1981 settlement agreement did
not determine whether the Perkinses, or their successors, actually had
prescriptive rights of access over the dirt road. Thus, that issue and other unaddressed issues
raised by the complaint and cross-complaint remain outstanding.
II
Attorney Fees on Appeal
The 1981
settlement agreement gives the prevailing party the right to attorney fees, and
both the LP and Perkins seek fees on appeal.
the prevailing party on appeal, and on remand the trial court shall determine
the fees she reasonably incurred. (
Advisors, Inc. (2009) 173 Cal.App.4th 1533, 1541.)
DISPOSITION
The
judgment is reversed and Perkins's request for attorney fees on appeal is
granted. The case is remanded to the
trial court for further proceedings in accordance with this opinion and to
determine the reasonable fees Perkins incurred in litigating her appeal. Perkins is also otherwise awarded her costs
on appeal. The stay issued June 14,
2012, is vacated.
McCONNELL, P. J.
WE CONCUR:
HUFFMAN, J.
McDONALD, J.
name="_ftn1" title="">[1] As of 1982 Perkins's parents held the property in a family
trust, but we continue to refer to the owners as the Perkinses. Likewise, for convenience we do not note the
trusts of others involved.
name="_ftn2" title="">[2] We deny Perkins's request to take judicial notice of the
Perkinses' first amended complaint as it was not before the trial court. (Duronslet
v. Kamps (2012) 203 Cal.App.4th 717, 737.)
