Case of the Day – Wednesday, October 12, 2016

WRITE ME UP A VERBAL CONTRACT

putt150827OK, what’s a little New York case about a miniature golf course construction contract doing on a tree law blog? It’s here as a cautionary tale …

A miniature golf operation called Oasis Park hired Bill Oberholtzer – who was both a miniature golf course owner and a mini golf course builder – to jazz up Oasis Park before the mini golf season started up in the Troy, New York, area. Disregarding the universally-accepted good practice in construction of starting with a nice, neat signed agreement setting out the scope of the work, payment terms, time to completion and other such details, the Oasis Park people and Bill pretty much sketched out their agreement on the back of a cocktail napkin. And that was a mistake.

Later, Oasis Park needed a more formal document in order to get its bank to release financing. Bill, of course, accommodated Oasis Park by signing one. You can guess what happened. When the parties’ working relationship soured, Oasis claimed that the accommodation document – and not the “cocktail napkin” – was the real deal between the parties covering the scope of the work. Bill countered that he had already been working for weeks, and the plans had changed.

You probably need a little more contract detail than you can fit on a napkin.

You probably need a little more contract detail than you can fit on a napkin.

Nevertheless, within six weeks after some fateful April 29 “thing” occurred — and even the Court couldn’t tell what the “thing” was — Oasis fired Bill amid claims that he hadn’t adhered to some nonexistent schedule, hadn’t provided workers, and hadn’t provided materials. For good measure, Oasis claimed that Bill’s work was substandard.

Bill naturally argued just the opposite, asserting that he couldn’t buy supplies because Oasis Park wouldn’t pay him. The whole mess ended up in federal court, where the Judge threw up his hands and said no one was getting summary judgment. The entire kerfluffle was going have to be sorted out at trial.

So now, let’s all grab our calculators and figure out how Bill saved by not wasting money on a lawyer preparing a contract with Oasis Park up front. Not much, we guess. And you arborists, tree trimmers, loggers and owners – let’s remember this: No contract, no winners.

sign150827Paone, Inc. v. Oberholtzer, Slip Copy, 2007 WL 2455074 (N.D.N.Y., Aug. 23, 2007). Oberholtzer agreed to provide all labor and materials necessary to remodel Paone’s miniature golf course. Beyond that fact, the parties could agree on nothing.

Paone said that under a contract dated April 29, 2004, Oberholtzer to build a bumper boat pond, including walls, docks, light fixtures, a cave, a filter system, a perimeter walkway, and a staging-area deck. As well, Paone said, the contract required Oberholtzer to renovate the course’s clubhouse entrance, the third hole, and the practice green. Paone said that under to the contract, Oberholtzer began working in May 2004, but its laborers did not show up for work, causing the project to fall behind schedule. To rectify the situation, Paone claims that it hired temporary workers.

Even with these outside laborers, the project did not move forward because Oberholtzer failed to provide supervision and direction. Paone said it had to supply all materials to the site and hire various construction professionals to inspect the work. Paone contended that these professionals found that Oberholtzer’s work violated building-code requirements and was below the industry standard. After the project had gone on about a month, Paone notified Oberholtzer that it was in default of the contract.

Oberholtzer, on the other hand, claimed that he reached an agreement to perform work for Paone well prior to April 29, 2004. Oberholtzer said he began preparatory work in March. The April 29th document, Oberholtzer contended, was merely an estimate prepared at Paone’s request,intended by both parties to help Paone get a bank loan released. The April 29, 2004, agreement was conformed to an earlier budget from the winter of 2003-2004, which Paone had submitted to the bank to support its initial loan application.

golf150827Consequently, Oberholtzer argued, the estimate did not reflect intervening changes of which both parties were aware, including a different location for the bumper boat pond, changes in site elevations for the clubhouse and parking lot which required alteration of a ramp and deck, and additional concrete walkways on the course.

Oberholtzer said, he had already made significant progress before April 29, 2004, including filling in traps, reconfiguring the practice green, removing an existing sidewalk near the old practice green, building a deck between the seventh and eighth holes, and removing fixtures and equipment from the old clubhouse. What’s more, Oberholtzer asserted, he had also cleared and trimmed trees for a new picnic area, built retaining walls for a walkout basement, constructed a deck attached to the clubhouse, erected bumper boat pond walls and skimmer baskets, and backfilled the pond.

As far as the schedule went, Oberholtzer argued that the April 29, 2004, document did not contain a schedule or other time-related requirements. Oberholtzer said that Paone knew Oberholtzer would be opening and operating his own miniature golf course in Georgia at the end of May. Therefore, Oberholtzer claimed, Paone knew that Oberholtzer would not be available to work on the project on a regular basis. Furthermore, Oberholtzer argued that several weeks of delay resulted from the actions of an unrelated contractor, who placed heavy equipment in the area of the future bumper boat pond. Also, he said, Paone failed to make timely payments to enable Oberholtzer to buy materials and to progress with the project. Finally, Oberholtzer complained that Paone approved all building plans, and that town building inspectors routinely inspected the progress and noted no building code violations.

Paone sued for breach of the contract and for negligence, and then moved for summary judgment.

obfus150827Held: Summary judgment was denied in this fact-laden morass. The Court observed that Paone’s causes of action for breach of contract and breach of the implied covenants of good faith and fair dealing both required first that there be an enforceable contract with sufficiently definite terms. Here, the parties could not even agree on whether the document was a contract, let alone what its terms might be. Paone contended the document represents the parties’ complete agreement, but Oberholtzer asserted that the document was an estimate used solely for the purpose of obtaining funding. While Paone said that the time for performance commenced in May 2004, Oberholtzer alleged that it had already completed substantial portions of the project prior to that time.

What’s more, the Court found, reference to the April 29, 2004, document wasn’t helpful because it contained no details about the parties’ responsibilities or the construction schedule. The document was labeled “Spring 2004 Construction” and merely set forth the various projects and the price for each. In light of these disputes, the Court held, it could not determine whether an enforceable contract existed between the parties without evaluating the parties’ conflicting factual accounts. Moreover, on the basis of the April 29, 2004 document alone, the Court could not determine the construction schedule or the parties’ respective contractual responsibilities.

A trial would be necessary to straighten the whole mess out.

TNLBGray140407

Case of the Day – Tuesday, October 11, 2016

ME AND MY SHADOW

Removing covenants can be like herding cats ... which explains why Robby Ricciardello looked for a shortcut.

Removing covenants can be like herding cats … which explains why Robby Ricciardello looked for a shortcut.

We had occasion last year to round up a majority of 55 subdivision owners in order to revoke some 25-year old restrictive covenants. The rules were pretty harsh – no work vehicles with signage in front of the house, no sheds, no yard signs …

It helped that almost everyone in the subdivision was already violating one or more of the covenants. We explained – over a several-month education program – that all it would take is one jerk moving into the neighborhood who wanted to stick it to his neighbor, and we’d all face trial court Armageddon.

We got a majority to sign on, but it was like herding cats, an exhausting effort. We made our filing deadline by a nose. The whole experience gave us a heightened appreciation for the long suffering neighbor in today’s case.

The case concerns poor Robby Ricciardello. Well, maybe not poor in the fixed asset sense. Robby owned five lots in a subdivision, and he had big plans — plans like build a barn, store bulldozers, hunt, grow mangoes — you know, the kinds of things we all like to do with our lots in the middle of subdivisions.

A man oughta be able to do what he wants with his own property ... right?

A man oughta be able to do what he wants with his own property … right?

But he had a problem. His deed contained one of those pesky restrictive covenants that restricted the use of the lots to the construction of one-family homes only. Fortunately for Rob, the restrictive covenants provided that they could be amended or terminated by a vote of the owners of six of the subdivision lots.

Robbie decided to build a barn anyway, and he hatched a plan to pull it off. He told his neighbor Jim Carroll what he was going to do. Jim panicked, because he knew Rob had five lots and only needed the concurrence of one more owner. So Jim hatched a plan of his own, starting a drive to amend the covenants in order to make them harder to circumvent. Finally, Rob announced he wouldn’t build a barn after all, so Jim abandoned his efforts.

Any sense of relief Jim felt was short-lived, because Rob did an end run on the subdivision owners. He formed his own limited liability company, which he had to buy an additional lot. Rob essentially had a meeting with himself as an owner of five lots and Connecticut Outfielder LLC – of which he himself was the president – being the sixth lot owner. Rob took a nose count, and — mirable dictu — the owners of the minimum six lots were present! The vote was unanimous, unsurprisingly, as Rob agreed with himself to terminate the covenants.

My shadow is duly incorporated ...

My shadow is duly incorporated …

Pretty slick, Rob. But Jim didn’t think so, and he sued. Connecticut Outfielder protested that it had done nothing wrong. It just agreed to terminate the covenants, something it as an owner had a right to do. Rob and his alter ego LLC moved for summary judgment, pointing out that the restrictive covenants had been terminated. The court disagreed, finding that issues of fact existed, not the least of which being whether Rob had misled James to induce him to abandon trying to amend the covenants, and whether one guy – by controlling six lots himself or through corporate devices – could validly terminate the covenants.

James B. Carroll 2003 Revocable Trustee v. Ricciardello, Not Reported in A.2d, 2007 WL 2080583 (Conn.Super., Apr. 4, 2007). It seems that Robert Ricciardello and James Carroll were adjacent landowners in the Ferrando Subdivision of Glastonbury Connecticut. The Subdivision lots were subject to a “Declaration of Covenant and Restrictions” that provided, in part, that “[e]ach lot shall be used and maintained solely and exclusively for one-family residential purposes … No trailer, tent, shack, garage, barn or other outbuilding erected on any Lot shall at any time be used as a residence temporarily or permanently … [The] covenants and restrictions are to run with the land and shall be binding on the Declarant, purchasers or owners of any Lot … for a period of twenty (20) years from the date of recording … During the twenty-year period that this Declaration is in effect, any or all of the covenants, conditions and restrictions contained herein may be amended or terminated by an instrument signed by the then owners of at least six (6) of the Lots described on Schedule A hereto, which instrument shall be recorded on the Glastonbury land records.”

In June 2004, Ricciardello told Carroll he intended to build a barn on one of the six lots he owned. Carroll started talking to the other owners about amending the covenants to, among other things, raise the number of lot owners needed to amend or terminate the covenants. Then Ricciardello told Carroll he had decided not to build the barn, and Carroll abandoned his efforts to get the covenants stiffened.

But Ricciardello, ever the crafty one, formed a Connecticut limited liability company named “Connecticut Outfielder LLC.” The same day it was formed, it bought lot two of the subdivision. Three weeks later, Ricciardello and Connecticut Outfielder — who together owned six lots in the subdivision — executed a “Release of Declaration of Covenants and Restrictions,” that was recorded in the Glastonbury town clerk’s office, which wiped out all of the covenants and restrictions on the books.

covenant150826Ricciardello proceeded to do as he liked with his lots, planting an orchard, hunting and storing construction equipment. Carroll sued, claiming that the release of the covenants was improper, and asked for an injunction. Ricciardello and Connecticut Outfielder answered, counter-claimed and filed for summary judgment. Connecticut Outfielder contended there are no genuine issues of material fact and that Connecticut Outfielder is entitled to judgment as a matter of law for the breach of restrictive covenants count and the counterclaim seeking a declaration judgment that the release of covenants is valid. Connecticut Outfielder’s grounds of the motion are that Carroll testified that Connecticut Outfielder did not breach the covenants, and, the plaintiff did not allege any wrongdoing by Connecticut Outfielder in the operative complaint. Carroll objected that there were genuine material issues of fact.

Held: Summary judgment was denied. Summary judgment, of course, is appropriate where the pleadings, affidavits and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.

In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party. Here, the Court said, genuine issues of material fact exist concerning whether Ricciardello and Connecticut Outfielder breached the covenants and whether the covenants were properly released. Also, an issue existed whether Carroll relied on Ricciardello’s false assurances that he wouldn’t build a barn in deciding to abandon his quest to amend the covenants to block Ricciardello’s plans.

As long as those issues remain, the case must go to trial.

TNLBGray140407

Case of the Day – Friday, October 7, 2016

T.H.E. CAT

Robert Loggia as Thomas Hewitt Edward Cat, accomplished second-story man turned bodyguard in this 1960s action series ...

Robert Loggia as Thomas Hewitt Edward Cat, accomplished second-story man turned bodyguard in this 1960s action series …

Remember T. Hewitt Edward Cat? His hangout at the jazz joint Casa del Gato? Lalo Schrifin’s cool theme music?

That’s OK if you don’t, because the cat we’re talking about today is anything but the black-clad suave Robert Loggia. More Garfield than cool cat, the Dinuccis’ tabby kept wandering into Mr. Lis’s yard. The Dinuccis — who, face it, didn’t have a great rapport with their neighbor to begin with — didn’t give a hairball about Lis’s complaints.

Finally tired of it all, Mr. Lis trapped the feckless feline and turned it over to the City. The City charged with Dinuccis with an “animal at large” minor misdemeanor. About this time, old softie Mr. Lis contracted a case of the “guilts.” He could hardly live with himself if the Dinuccis found themselves doing 30-to-life in some hard-labor gulag. So he relented, and asked the city law director to dismiss the charges.

Big mistake. Proving the old adage that no good deed goes unpunished, the Dinuccis promptly sued Lis for malicious prosecution.

deed150825After the long-suffering neighbor paid a metric ton of legal fees, the trial court threw the case out, and the Court of Appeals agreed. The Dinuccis’ case suffered from a simple problem: they never denied their cat was free range (how could they?), and that was all the ordinance required. Because there was probable cause to believe that the peripatetic pussycat had gone feral, there was probable cause to believe ordinance had been violated. That being the case, there could not be malicious prosecution.

Nevertheless, if it happens again, we’d bet Mr. Lis’ll demand the City Prosecutor throw the book at ‘em — and probably overdose their sweet little kitty with industrial strength catnip. Ingratitude isn’t only unbecoming… often, it’s self-defeating, too.

stray150825Dinucci v. Lis, Slip Copy, 2007 WL 2269740 (Ct.App. Ohio, Aug. 9, 2007). This dispute between neighbors started over involving the capture and eventual safe release of a house cat. The parties were before this court in an earlier dispute, which involved trespass, property damage, and continuing nuisance claims by the Dinuccis against their next-door neighbor Matthew Lis. Then the Dinucis had claimed Lis was liable for 1) delays in the construction of their house due to his objections, 2) damage to their lawn caused by trespassing, 3) willow tree branches hanging over their property, and 4) creating a nuisance by having the Lis yard look like a construction site for over two years. Out of all of that the Dinuccis won a princely $150 for damage to their lawn, the rest of their claims having been thrown out. The Dinuccis appealed to no avail.

At the same time, it appears that Lis had been complaining since 2004 about Dinuccis’ cat wandering around the Lis homestead. Lis contacted the North Royalton, Ohio, animal control department. The City’s animal control officer told the Dinuccis that the city had received complaints from neighbors concerning their cat, and warned them that they would be cited if the problem wasn’t resolved.

It wasn’t, and a few months later, Lis captured the feline on his property and turned it over to the City. The Dinuccis were charged with a violation of North Royalton Ordinance 618.01, the “Animal At Large” provision. The North Royalton prosecutor met with the parties, at which time Lis agreed with the recommendation that the criminal charge against the Dinuccis be dismissed. But after the charges were dismissed, the Dinuccis filed a civil lawsuit against Los, alleging malicious prosecution and intentional infliction of emotional distress. The trial court granted Lis’s motion for summary judgment and dismissed the case. Dinuccis appealed.

garfield150825Held:  The case was correctly thrown out. The Court observed that, after all, North Royalton Ordinance 618.01 clearly stated that ‘[n]o person who is the owner or keeper of horses, mules, cattle, sheep, goats, swine, dogs, cats, geese or other fowl or animals shall permit them to run at large upon any public way or upon unenclosed land” and that “[t]he running at large of any such animal in or upon any of the places mentioned in this section is prima facie evidence that it is running at large in violation of this section.” In order to establish the tort of malicious prosecution, the Dinuccis had to prove malice in instituting or continuing the prosecution, a lack of probable cause, and termination of the prosecution in favor of the accused. And here, the Dinuccis couldn’t show a lack of probable cause.

Probable cause does not depend on whether the claimant was guilty of the crime charged, but instead, only on whether Lis had probable cause to believe that the Dinuccis were guilty. Lis wasn’t bound to have evidence sufficient to insure a conviction, but instead was required only to have evidence sufficient to justify an honest belief of the guilt of the accused. Here, the Court said, the evidence show that both the city and Lis had a reasonable belief that Dinuccis violated North Royalton Ordinance 618.01.

Indeed, the Dinuccis didn’t deny violating the ordinance either at the trial court level or in their brief. Their cat was captured on Lis’s property. As a result of a reasonable belief that the violation occurred, probable cause to investigate existed. The evidence was sufficient to justify an honest belief of the guilt of the accused.

TNLBGray140407

Case of the Day – Thursday, October 6, 2016

SIR, YOU ARE NO GEORGE WASHINGTON

solong161006Today, we conclude our consideration of the trespass problems faced by our New Hampshire landowners Larry and Laura Littoral. If you have followed along to this point, you know that the Littorals’ pastoral cottage getaway, situated on a classic New England pond, has been disrupted by neighbor Wally Angler.

Wally – who is really a NINO (neighbor-in-name-only) – is an angler, and asked the Littorals to chop down some dead trees on their property to create a trout habitat in the pond for the primary (and sole) purpose of adding to Wally’s piscatorial pleasure.  You can hear him now: “Thanks for all the fish!”

The Littorals preferred that their dead timber remain standing. When Wally asked them to cut down the trees, they said, “so long,” refusing to dump their tree into the pond. Apparently reasoning that it’s easier to ask forgiveness than permission – especially where permission has already been denied – Wally then took advantage of the Littorals’ weekend absence by bringing in a tree service to cut the trees down for him. According to the Littorals, Wally affirmatively misled the tree cutters that the dead trees were on his property, and the tree service cut down the timber with alacrity.

gw161006For the record, Wally denies having anything to do with the felling of the dead trees. He seemingly maintains that he turned around one day, and mirabile dictu, the trees were on the ground. If George Washington had tried a similar woof story on his father about a downed cherry tree, we’d probably all be speaking English and enduring lousy health care right now. As every schoolchild knows, however, Little George ‘fessed up, telling his father, “I cannot tell a lie.” Channeling Lloyd Bentsen, our observation is this: Wally, we served with George Washington, George Washington was a friend of ours. Wally, you’re no George Washington.

Our analysis this week has assumed that unless Wally can produce the elves responsible for the tree cutting (and their saws), the Littorals will easily meet their burden of proof.

So far this week, we have concluded that the Littorals may bring a double-barreled complaint, alleging a statutory violation of New Hampshire’s trespass-to-tree statute, R.S.A. § 227-J:8, and a common-law trespass count. The § 227-J:8 count carries some pretty serious penalties, from three to 10 times the market value of the trees. The catch is that the penalties must be based on a multiple of market value. Market value may be the stumpage value of the wood – what it is worth on location to a lumber buyer – or on the cost to replace the tree, minus transportation and planting costs.

We’re assuming for the sake of this column that a few dead trees probably are not going to have much stumpage value. The Littorals could find an expert to establish how much replacement of the trees would cost, but replacement value has traditionally been used because everyone assumes that the destroyed trees would have continued to flourish but for the actions of the defendant. Here, the defendant’s expert would have a good argument that those trees were going to fall in the near future anyway, and awarding the Littorals new live trees to replace their old dead ones would represent as windfall to the plaintiffs.

Wally suspects elves.

Wally suspects elves.

Given Wally’s underhanded approach to getting what he wanted (and what the Littorals did not want), we don’t have much trouble with the Littorals receiving a “windfall.” The law in New Hampshire and elsewhere does, however, holding that damages should be limited to compensating for the actual injuries suffered. For that reason, the Littorals can take the confluent approach that under the common law of trespass, their real property has suffered a decrease in value because of Wally’s conduct, both because of where the dead trees are no longer standing and because of where they are currently laying.

Even then, the Littorals might have a problem because the usual assumption underlying damages for loss of trees is that standing timber will continue to stand for the indeterminate future. That assumption may be challenged where the standing timber is already dead. Nevertheless, there is ample evidence that dead trees standing have value. As we noted the other day, dead trees provide shelter or sustenance to over 40 percent of all birds, to amphibians, and to lichens and moss. Dead trees create “snow fences” that slows wind-driven snow. The snow that is trapped melts in place and saturates the ground, providing additional moisture to live trees. Dead trees create hiding cover and thermal cover for big game as well.

Even more counter-intuitive, dead trees – after dropping their needles and bark – may reduce fire hazard. Their flammability is greatly reduced compared to green trees containing flammable resins.

stumps161006In the case we’re looking at below, the plaintiff relied on standing dead timber to help maintain privacy from his neighbor. The court appeared to recognize that the elimination of the standing dead trees contributed to a substantial diminution of her property value, even while acknowledging that the trees themselves had no value. It’s not a New Hampshire case, but then there is a dearth of cases nationwide where the wrongfully cut trees were ornamental in nature and yet very dead even before tasting the ax. We were glad enough to find this one. The decision suggests that an action alleging loss of privacy may be the strongest case of all.

Caciopoli v. Lebowitz131 Conn.App. 306 (Court of Appeals, Connecticut, 2011). Dominic Caciopoli was a man who liked his privacy. He bought his place because it was isolated and private, surrounded by forest on all sides except for one area of the lot though which his driveway passed. A short while later, Jeffrey Lebowitz bought the place next door. His house was about 100 yards from Dom’s, and the area between the residences was wooded, affording each privacy from the other.

A few months after moving in, Jeff hired a tree service to clear standing dead trees from the wooded area between the two homes. Jeff believed the dead, but he didn’t check that carefully. The tree service removed all the dead timber, both standing and on the ground, some small saplings, and a few larger trees to provide more sunlight and enlarge the areas surrounding his house. Of course, it turns out that virtually all of what was cut belonged to Dom.

When Dom came home to find that his natural privacy barrier had been clear-cut, he was not happy. He went to Jeff’s front door and expressed his displeasure, pointing out the actual property line in the process. Nevertheless, the next day, the tree service returned and finished the job. The removal of the trees and brush left Jeff with an unobstructed view of Dom’s house.

Jeff tried to make amends. He sent Dom a letter admitting his error and planted some trees on Dom’s property to replace what had been taken. Dom was not happy with the results, and undertook his own extensive landscaping project in a failed attempt to restore his lost privacy.

Give a man a fish, and feed him for a day. Give a man a chainsaw, and watch trouble ensue.

Give a man a fish, and feed him for a day. Give a man a chainsaw, and watch trouble ensue.

Dom sued Jeff for common-law trespass and for treble damages pursuant to Connecticut General Statutes § 52-560 (the Connecticut adjunct to R.S.A. § 227-J:8). The trial court found that Dom had proven the elements of an intentional trespass action, and awarded him $150,000. for the diminution in the value of his property caused by the trespass. Notably, the trial court declined to award any damages for the value of timber removed.

Jeffrey Lebowitz appealed, alleging a lot of infirmities with the trial judgment. Of interest to the Littorals is Jeff’s appeal of the damage award.

Held: The trial court’s award of $150,000 was proper. The trial court found that after the cutting Dom’s place was worth $675,000, according to an appraisal performed by a certified general real estate appraiser. The appraiser opined that prior to the cutting, Dom’s market value was $825,000. The Court of Appeals noted that Jeff could have presented his own expert testimony on the diminution of value, but he did not. Applying the ancient legal doctrine, et dormiat, ne perdatis (“you snooze, you lose”), the court said Dom’s expert was found to be credible and competent, and absent Jeff making an expert showing at all, that was good enough.

But, Jeff complained, Dom’s expert was not qualified to give an opinion as to the effect of the removal of certain trees from Dom’s property on its market value. He argued the expert had no relevant experience, and was considered an expert only because she had a real estate appraiser’s license. However, the Court of Appeals said, the trial court relied on the fact she had conducted 1,500 appraisals before, and when the trial judge asked her whether she was able to testify as to the value of the property before and after the removal of the trees, she said she could. (This is rather like finding that she was an expert because she asserted she was, a rather bizarre ipse dixitbut the Court of Appeals was loathe to disturb a verdict, and thus to give Jeff a second bite of the apple on remand).

Jeff also argued that the court made no finding whether there was an adequate factual foundation for a “retrospective appraisal” – an appraisal after the fact of the value of the property before the cutting – and that Dom did not ask the court to find  there was an adequate foundation for allowing the opinion evidence. The Court of Appeals pointed out that it was Jeff’s burden to object to the testimony on those grounds at the time of trial. Again, et dormiat, ne perdatisThe expert testified she visited the property in January and February 2009, and had determined the lot enjoyed a high degree of privacy prior to the incident. She also studied photographs of the lot prior to the trespass and after the trespass, and noted that the pictures depicted more clearing of trees than she had imagined and thus, strengthened her opinion as to diminution in value.

No one contests that trees in the water are a good habitat for fish... but Wally should have used his own trees.

No one contests that trees in the water are a good habitat for fish… but Wally should have used his own trees.

The Court observed that Jeff pointed to no authority to suggest that the expert’s personal observation of the property, her reliance on the plaintiff’s descriptions of the prior conditions of the property and photographs of the property in its prior conditions formed an inadequate factual foundation. The Court said the expert’s personal observation of the property “complemented by the plaintiff’s descriptions of the property in its prior conditions, is not impermissibly speculative…” After all, the Court said, Dom – as the owner – was undoubtedly familiar with his property (if perhaps lacking disinterest in the outcome), and no one was more competent than he to describe to the expert what it had looked like before the cutting.

The Court held the fact that the expert “could not give a logical explanation for how she arrived at her opinion and did not articulate or apply methodology suitable to determining any diminution in value caused by the clearing of trees” was not fatal to her testimony. She testified that she examined real estate in the area, found comparable properties, estimated degrees of privacy and made adjustments, positive or negative, for the differences in the properties in order to “equal everything out.” She also noted that an appraisal is not based on science, but it is just an opinion as to value, and the Court accepted that.

Jeff had to pay the $150,000. That’s a lot of money for some dead trees that had no stumpage value.

TNLBGray140407

Case of the Day – Wednesday, October 5, 2016

SOMETIMES PLAIN VANILLA TASTES PRETTY GOOD

Today, we continue to examine the situation faced by our Granite State tree victims, Larry and Laura Littoral. If you read yesterday’s post prior to your third Arnold Palmer martini, you recall that the Littorals have both a cottage on a pond – which is beautiful –and a pesky neighbor, Wally Angler – who is not so beautiful.

cuibono161005Fisherman Wally’s entreaties to the Littorals that they cut down some dead trees on their property, dropping them into the pond where they will provide a habitat for the fish Wally loves to catch, fell on deaf ears. It seems  the Littorals liked the contribution their standing dead timber made to their cottage ecosystem. So when the Littorals were absent one fall weekend, Wally took matters into his own hands, hiring a tree service to cut down the trees. Wally of course denies having any role in the tree’s mysterious felling, but for the sake of our analysis – and because we recall Marcus Tullius Cicero’s incisive question, cui bono? (that is, “who benefits?”) – we reasonably assume that proving Mr. Angler was the only guy with motive, opportunity and means to cut down the trees will be child’s play.

Yesterday, we considered New Hampshire’s trespass to tree statute, R.S.A. § 227-J:8, which has been around in some form since the early 19th century. It’s a pretty solid statute, providing that no person shall negligently cut, fell, destroy, injure, or carry away any tree or part thereof on the land of another person. If someone violates the statute, he or she is liable for a forfeiture to the aggrieved landowner of anywhere from three to ten times “the market value of every such tree, timber, log, lumber, wood, pole, underwood, or bark cut, felled, destroyed, injured, or carried away.”

Notice that we used quotation marks in the foregoing paragraph. They’re there for a reason. You see, the rub in 227-J:8 is that the statute turns on the market value of the trees. That worked very well when the kind of timber trespass going on was limited to a lumberman taking a thousand trees from the wrong side of the boundary marker. Indeed, that was precisely the kind of conduct at which the statute was aimed. But 227-J:8’s a tougher fit where only two or three trees are cut, not for their market value but rather for some noncommercial reason. The Littorals could sue under 227-J:8, but what would the market value be of few dead trees (or even a few live ones)?

In a stretch perhaps dictated by necessity, the New Hampshire Supreme Court in the case we discuss below did hold that “market value” may be measured as the cost of a replacement tree of comparable value, but even that might not get the Littorals very far. Such an analysis would bring them fairly quickly back to a measure of the fair market value of the dead tree itself.  To get any traction, the Littorals have to get beyond the value of the dead tree qua tree, and instead find a measure of damages that focuses on the value of the dead trees to the property.  We’ll be focusing more on that tomorrow, but for now, we need some legal vehicle that will let them be compensated adequately for Wally’s selfish attack on their property.

Fortunately, the common-law remedy of trespass continues to enjoy vitality in New Hampshire. Assuming the Littorals lost three dead trees, and assuming that they could find an expert who would testify that the stumpage value of those trees was $300 apiece, they would not quite get to $1,000 in damages (before 227-J:8’s multiplier was applied). But the three trees – referred to in the tree law world as “ornamental trees – were worth much more to the Littorals (and their real estate).

Common-law trespass - the "plain vanilla" tort still tastes pretty good.

Common-law trespass – the “plain vanilla” tort still tastes pretty good.

Where the trees lost are not commercial timber, but rather trees with aesthetic value (or some other specialized value), New Hampshire courts will permit the injured party to sue in trespass, and for damages to show either that the market value of the real estate has fallen because of the loss or that the cost of replacing the lost trees rises to some ascertainable figure.

Here, although the Littorals are entitled to (and will probably want to) include an R.S.A. § 227-J:8 claim, they will also want to allege the good old plain-vanilla tort of trespass, showing that Wally’s transgression damaged their property as a result. After all, New Hampshire lets the injured homeowner include both the time-tested common-law trespass claim and an R.S.A. § 227-J:8 claim in the same complaint. Common-law trespass may be plain vanilla, but it’s survived as a cause of action for centuries because it works.

The Littorals report that they have evidence Wally moved the iron-pin boundary markers before the tree service arrived, so as to fool otherwise cautious tree workers that he owned the land on which dead trees in question stood. As it is in most states, moving property markers is a misdemeanor in New Hampshire, not to mention being pretty compelling evidence of the willfulness of Wally’s conduct. Indeed, in most states, this would probably be enough to win punitive damages against Wally, which are extra amounts meant not to compensate the plaintiff for his or her injury, but rather to exact a pound of flesh from the misbehaving defendant.

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Burning a beer at the stake? Now that would be a “monstrous heresy.”

But New Hampshire isn’t “most places.” Rather, “the punitive function of exemplary damages has been rejected in forceful and colorful language” by the New Hampshire Supreme Court. “‘The idea is wrong,” the Granite State Supremes thundered well over a century ago. “It is a monstrous heresy. It is an unsightly and an unhealthy excreascence, deforming the symmetry of the body of the law’.”

Fortunately, modern New Hampshire jurists have left their aggrieved litigants an out. While punitive damages are forbidden, the courts agree that in cases “where the acts complained of were wanton, malicious, or oppressive, the compensatory damages for the resulting actual material loss can be increased to compensate for the vexation and distress caused the plaintiff by the character of defendant’s conduct.”

So if the Littorals sue for trespass, and show that the trespass and subsequent loss of their trees resulted because Wally was a guy who charged ahead fully aware he was in the wrong, their compensatory damages may rise well beyond even what they could get even if the court set the R.S.A. § 277-J:8 multiple at 10 times the market value of the dead wood.

But we’ve still left the question of exactly how much a dead tree is worth, either as marketable timber or for aesthetic purposes. We’ll take up that problem tomorrow.

Woodburn v. Chapman I, 116 N.H. 503 (New Hampshire Supreme Ct., 1976); Woodburn v. Chapman II, 117 N.H. 906 (New Hampshire Supreme Ct., 1977).  Chapman removed a single maple tree, 18 inches in diameter, which  stood on Woodburn’s land. He never imagined that cutting down one tree would result in two trips to the New Hampshire Supreme Court. But it did.

The trial evidence showed replacement of a 30-inch maple would cost $3,600. Taking this figure and applying a treble multiplier from the tree trespass statute, the court gave Woodburn judgment for $10,805.

Chapman appealed.

Held: In Woodburn I, the Supreme Court held that the trial court’s use of the tree’s replacement cost as the basis for the statutory penalty was wrong. The Court admitted that “in some circumstances replacement cost may be the proper measure of damages for the destruction of a tree.” But the tree trespass statute (then R.S.A. § 539:1, replaced later with R.S.A. § 227-J:8) “takes the value of the tree by itself,” the Court said. The severity of the statutory penalty varies with the productive quality of the tree. Indeed, the whole purpose of the statute is to protect marketable resources.

The Court held “where a tree confers other benefits on the plaintiff in the enjoyment of his property, he may join a count for compensatory damages with his count to recover the statutory penalty. The ordinary measure of damages in these circumstances is the difference between the value of the land before the harm and the value after the harm. In this case the plaintiff introduced evidence of special circumstances which might justify the award of the replacement cost of an eighteen-inch maple.”

On remand, Woodburn’s expert testified that the tree’s value by itself was $2,173. He arrived at this figure by deducting from the tree’s replacement cost the expenses associated with digging, transporting and replanting the tree, resulting in an estimate of the value of the tree itself. The trial court accepted the evidence, and awarded treble the amount as a penalty.

On appeal from the remand, Chapman complained that the base figure from which any statutory penalty is to be calculated must be stumpage value. He argued that the statute is designed to protect marketable timber, and thus only the tree’s value as timber should be used in computing the penalty. Since Woodburn produced no evidence of the tree’s stumpage value, Chapman complained, there can be no recovery under the statute.

The Littorals should have gotten this sign with special wording, "And don't cut down our trees, Wally, whether they're dead or not!"

The Littorals should have gotten this sign with special wording, “And don’t cut down our trees, Wally, whether they’re dead or not!”

The Supreme Court disagreed, holding that the statute applies to “whoever shall cut… any tree…” The statute’s application is not restricted to trees with stumpage value. Instead, the statute applies to any tree, whether its value is as timber or some other marketable commodity.

So, the Court said, where the tree is valuable only as timber, stumpage value should be used to assess the penalty. But, “this rule obviously cannot be applied to fruit, shade, and ornamental trees which have a measurable value but no stumpage value.” In this case, the Supreme Court ruled, the trial court “determined the value of the tree by subtracting from its replacement cost the cost associated with digging, transporting and planting the tree. This was an appropriate method of arriving at the ‘value of the tree by itself’.”

Additionally, Woodburn introduced evidence that the tree had special value to the real property as a boundary marker. That, the Supreme Court ruled, warranted the trial court’s award of $577.00 as compensatory damages in addition to the statutory penalty.

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Case of the Day – Tuesday, October 4, 2016

A FISH STORY

A very long-time supporter of ours from New Hampshire wrote us recently to recount the travails of his friends, Larry and Laura Littoral. They keep a cottage on one of New Hampshire’s many delightful ponds. Unfortunately for the Littorals, they have a neighbor, Wally Angler, who is both an avid fisherman and a pain in the fundament.

(These are pseudonyms, of course, and we hope you admire our creativity).

Dead trees are not always eyesores...

Dead trees are not always eyesores…

Wally has been badgering the Littorals to cut down several dead trees on their land. It’s not that the trees a threat to life and limb (they don’t), but rather Wally believes that if the dead timber falls into the pond, it will provide an excellent habitat for trout (and, in the process, benefit Wally’s favorite pastime). Larry and Laura like their property the way it is, believing that dead standing timber is an important part of the ecology of the place, providing sustenance for woodpeckers, shelter for martens, snow fences in the winter, and beauty for nature lovers.

There are two observations worth making here. The first is, while this may seem counterintuitive, abundant evidence exists suggesting that standing dead timber that otherwise does not pose a hazard to people or property has considerable value to the ecosystem. The second is that even if the standing dead trees are of no value to the woods, the Littorals are creating no risk to anyone by keeping the trees standing on their property, and if they like the denuded trunks where they are, the couple should be entitled to letting the dead trees stand.

Recently, the Littorals enjoyed a weekend getaway. At least, they enjoyed it until they returned to their cottage to find the dead trees mysteriously cut down and lying in the pond. Had Horatio been there, he might have said “O day and night, but this is wondrous strange!” But to the Littorals, unhappy as they were, it didn’t seem strange at all. And they didn’t have to look far for a suspect.

Is that the "Bart Simpson defense" we're hearing?

   The”Bart Simpson defense”clashes with Occam’s Razor.

They complained to the local constabulary, who spoke to Wally. He of course denied it, but the Littorals have figured out who Wally hired to cut down the trees, and even deduced that Wally moved the boundary line iron pins to trick the tree service into believing that the trees were Wally’s.

The Littorals are hopping mad, but they don’t want to hang an unsuspecting tree service out to dry. They wonder what action they might have against Wally, and whether the tree service will get nicked in the crossfire. Finally, they note that the local ordinance requires a permit to cut trees within 50 feet of a shoreline, grant of which depends on vegetation remaining or being added to maintain a measured level of trees and ground cover in the area. Unsurprisingly, no one bothered to apply for a permit.

Whew! It’s a veritable tree law final exam. Today, we’ll tackle the first (and easy) question: what kind of lawsuit do New Hampshire statutes permit the Littorals to bring?

At common law, what we’re looking at here is garden-variety trespass, often called in cases like this “trespass to trees” or “trespass to timber.” It appears, however, that New Hampshire has helpfully reduced the action to statute. Section 227-J:8 of the New Hampshire revised statutes provides that

I.      No person shall negligently cut, fell, destroy, injure, or carry away any tree, timber, log, wood, pole, underwood, or bark which is on the land of another person, or aid in such actions without the permission of that person or the person’s agent.

II.   In addition to any other civil or criminal penalty allowed by law, any person who violates the provisions in paragraph I shall forfeit to the person injured no less than 3 and not more than 10 times the market value of every such tree, timber, log, lumber, wood, pole, underwood, or bark cut, felled, destroyed, injured, or carried away.

Simply put, the Littorals have a nice statutory remedy here. Where most state wrongful cutting statutes provide for treble damages, New Hampshire courts can hammer unlucky defendants for up to 10 times the value of the timber.

What’s more, while the statute on its face seemingly applies only to negligent cutting – not to intentional pure-d mean cutting like what occurred here – New Hampshire appears to apply the statute to any wrongful cutting, employing the 3-10x scale provided by RSA 227-J:8 as an analog punishment gauge, with higher multipliers reserved for more egregious conduct.

whodunnit161004The case we look at below involves a New Hampshire timber trespass that exhibited some of the same kind of chutzpah shown by Wally Angler (assuming the Littorals can prove he’s the culprit, which we figure is pretty likely). The brazen willfulness shown by the defendant below – which was not much different from Wally’s intentional trespass – clearly influenced the damages awarded.

Tomorrow, we’ll explore whether the Littorals can bring a common law trespass action in lieu of proceeding under the statute. Then, of course, we’ll have to grapple with the thorny damages question: exactly how much is dead standing timber worth, anyway?

Today’s case:

McNamara v. Moses, 146 N.H. 729 (Supreme Ct. N.H. 2001). Marilyn McNamara lived in Eagle Rock Estates, a residential subdivision in Amherst. The subdivision plans show an access to the lot of her neighbor, attorney Bob Moses, as a shared driveway connecting the lot with the street. The driveway is steep and winding, and tough to use during the winter, so since 1977, Bob and other residents have used an unpaved roadway behind the lots, which they call Eagle Rock Drive, for easier access to their lots. Until 1998, everyone believed Eagle Rock Drive was on common land owned by the Eagle Rock Estates Association.

Marilyn bought her place in 1997. Even she believed Eagle Rock Drive was on common land that abutted the rear of her property. However, after someone proposed paving Eagle Rock Drive, Marilyn researched the matter and found Eagle Rock Drive actually traversed her lot. She announced this at an Association meeting, whereupon Bob Moses told her the Association members had adverse possession of the roadway.

Marilyn tried to get along, giving Bob written permission to use Eagle Rock Drive for the time being but urging him to upgrade his driveway soon, and to begin using it instead. She warned him that she would not agree “to pave the roadway under any conditions.”

In December 1998, Marilyn found one of Bob’s workmen cutting trees along the roadway on her property. The workman said he was preparing the road for further work at Bob’s request. Marilyn told him the property was hers, she had not given permission to cut the trees, and he should stop cutting and leave. When Marilyn’s joint owner, Bill Vargas, met with Moses later that day, Moses said “he owned the road,” and asked, “what are you going to do about it?” Marilyn quickly lawyered up, and told Bob as much in a letter.

The following Sunday, Marilyn and her beau returned from a weekend away (as did Larry and Laura Littoral), to discover that Bob Moses’ contractor had regraded the roadway and widened it by 5 feet. In so doing, Bob’s people cut down at least 12 of Marilyn’s birch and pine trees that did not interfere with passage over the roadway.

The dead trees are now "in" Golden Pond.

The dead trees are now “in” Golden Pond.

Marilyn sued to enjoin Bob from using Eagle Rock Drive and for damages and penalties for unlawfully cutting her trees. The trial court concluded Bob had a prescriptive easement to use the roadway to access his lot, but held that cutting Marilyn’s trees to widen the roadway had been an unreasonable use of the easement. The court awarded Marilyn compensatory damages of $1,200 – the market value of the trees cut in the widening – and penalties of five times that amount ($6,000) under RSA 227-J:8.

Bob appealed.

Held: The Supreme Court upheld the damages and penalties.

Bob argued the trial court erred in awarding damages based on speculation or approximation of the value of the trees. The Court rejected the argument, noting that the “speculative” nature in this case was not the prohibited kind, that is, whether a particular loss has been or will be incurred. Instead, the only speculation was how much damage had been caused, that is, the possible valuation of an actual loss.

The trial court awarded compensatory damages of $1,200 for the 12 lost trees, specifically finding that Marilyn’s estimated value of $100 per tree was “reasonable and, if anything, conservative.” The fact that McNamara did not identify each tree by species when testifying as to the average value of the felled trees may have made her showing kind of light, but that “does not render the court’s finding erroneous, particularly in light of the defendants’ decision neither to cross-examine her nor to offer contrary testimony. Finally, the mere fact that the plaintiffs’ estimate of the value of the trees was an approximation is not fatal.”

Bob also contended that the trial court abused its discretion by awarding five times the value of the felled trees as the penalty for violating RSA 227-J:8. The Court suggested that Bob’s own arrogance was an appropriate factor in setting the multiplier:

The record supports the court’s finding that the defendants willfully caused the cutting of trees on the plaintiffs’ property, thereby amply justifying a multiplier at the low end of the range specified in the statute. In particular, in addition to being informed at the May 1998 association meeting that the land in question was owned by the plaintiffs, when questioned as to whose land he thought he had been driving across prior to the meeting, Mr. Moses responded, ‘I didn’t know, other than I knew it wasn’t mine.’ The court’s assessment that the cutting on the plaintiffs’ land was intentional was also supported by testimony that, when [Marilyn’s joint owner] Vargas confronted the defendants on the afternoon of the cutting, their responses were, respectively: ‘what are you going to do about it?’ and a statement that Mrs. Moses would ‘continue the rest of the clearing herself with her own chainsaw.’ Moreover, after having been informed that they did not have permission to clear the land further, the defendants continued the clearing three days later when the plaintiffs were out of town.

The Court also noted that while maintaining the easement by keeping the road free of brush and overhanging limbs was within Bob’s rights, expanding the roadway by five feet was not.

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