Case of the Day – Thursday, August 13, 2020

LIS BLUDGEONS

dancing-nuns140606If you’re suing a neighbor because you claim title to a piece of her property, the last thing you want to see happen is for her to sell it to the Little Sisters of the Poor before your lawsuit is completed. The neighbor makes off with the money from selling your property, and when you finally win, you have the PR problem of the bailiff dragging a gaggle of nuns off your land while TV crews report your heartlessness live on CNN.

It was for precisely this reason — well, maybe not precisely for this reason — that the law has developed a mechanism known as lis pendens. A lis pendensliterally, “lawsuit pending” – is a notice filed with the office of the county responsible for deeds (often the county recorder) that puts the world on notice that litigation is going on that relates to ownership of the piece of land at issue. Practically speaking, the filing will send prospective buyers and lenders fleeing for the next county.

The purpose of lis pendens is laudable: it keeps wily defendants from transferring interests in land that is subject to a lawsuit, so a plaintiff doesn’t have to endlessly sue new buyers and lessees in order to collect on a judgment. But like with any reasonable and necessary mechanism, there are those who — as the legendary trickster Dick Tuck would have said — who want to run it into the ground.

In today’s case, the plaintiff sued the defendant over a large tree on the boundary between their properties, alleging that it had been negligently trimmed to lean onto their property, that it constituted a “spite fence,” and that its size and location constituted a nuisance. Of interest to us was the last allegation, that in a prior lawsuit between the parties, the defendant’s lawyer had filed a lis pendens on plaintiff’s lot that caused a sale to fall through. The plaintiffs said that the lis pendens — which a court had later thrown out — constituted a tort known as “slander of title.” This was so because the underlying litigation had nothing to do with whether the defendant claimed title or the right to possess the plaintiff’s property. Defendant’s lawyer filed it simply as a club with which to bludgeon the plaintiffs, as part of a take-no-prisoners litigation strategy.

kkdk73106pet1140606The defendant’s lawyer argued the slander of title had to be dismissed, because as counsel for the other side, he owed no duty to the plaintiffs. The California court conceded that he didn’t, but said that was irrelevant: slander of title is an intentional tort (like a judge hauling off and slugging a public defender). Unfortunately, the Court said, the plaintiffs’ pleading wasn’t very well written, and the Court couldn’t be sure that they had alleged malice. The more prudent course, the Court thought, was to offer them a chance to amend their complaint to make clear that they were alleging the defendant’s attorney had acted maliciously.

Castelanellis v. Becker, 2008 Cal. App. Unpub. LEXIS 165 *, 2008 WL 101729 (Cal.App, Jan. 10, 2008). The Castelanellis owned real estate in Humboldt County. They sued the owner of the neighboring home, Kristine Mooney, and her lawyer Thomas Becker, alleging that on the border between their unimproved lot and Mooney’s property, “a large tree” curves from the bottom portion of its trunk toward the Castelanellis’ property and takes up so much space that “the subject property cannot reasonably be developed as a residential property.” They also claimed that Mooney’s house tree blocked light to the tree and caused the tree to grow almost exclusively over their property, and that Mooney had trimmed or negligently maintained the tree to contribute to its “odd and unusual angle.”

The complaint maintained that the tree constituted a spite fence within the meaning of California law, and was “maliciously maintained for the purpose of annoying the plaintiffs and in an attempt to gain ownership of plaintiffs’ land at less than fair value.” The complaint alleged nuisance, trespass, tortious interference with contractual relations, and tortious interference with economic relations. The Castelanellis alleged that Mooney sought to “purchase plaintiffs’ property at below fair market value” and had “threatened legal action if plaintiffs trimmed the subject tree in order to make their property capable of being developed and sold.” Finally, they alleged that Mooney and Becker published “false statements” in a lis pendens filed as to the Castelanellis’ property, and this lis pendens — later thrown out by another court — had prevented the Castelanellis from selling the property. The trial court agreed that because Mooney and Becker owed the Castelanellis no duty, there could be no slander.

The Castelanellis appealed.

Held: The Castelanellis had made out an adequate cause of action against Attorney Becker. A party to an action who asserts a real property claim may record a notice of pendency of action in which that real property claim is alleged, called a lis pendens. Such a notice places a cloud on the title, and effectively keeps any willing buyer from wanting to close on a transaction until the lis pendens is cleared. In order to be privileged, so that no party may later sue a party or its attorney for filing such a notice, a notice of lis pendens must both (1) identify a specific action “previously filed” with a superior court and (2) show that the previously-filed action affects “the title or right of possession of real property.

In this case, the notice of lis pendens clearly identified that it was signed and filed in conjunction with litigation involving a tree growing upon a shared property line. But nothing in the record enabled the Court to determine that litigation involved the “right of possession” of either of the two properties involved in that litigation. If it did, a litigation privilege clearly applied, and the action against Attorney Becker could not stand.

Becker argued that he had no duty to the Castelanellis, and he could therefore not be sued by them. The Court pointed out that this would be true if the action were based on negligence. However, the action was an intentional tort, like the tort of malicious prosecution, and there need not be a duty of care owed to the victim by the perpetrator before an intentional tort can be inflicted. The Court said that while an attorney cannot be liable in negligence to a formerly adverse party, that rule does not exempt the attorney from liability for malicious prosecution.

The tort of slander of title does not rise to the level of either malicious prosecution or abuse of process. The elements of the tort have traditionally been held to be publication, falsity, absence of privilege, and disparagement of another’s land which is relied upon by a third party and results in a pecuniary loss. Slander of title does not include express malice as an intrinsic factor. Here, while the Castelanellis did not specifically plead malicious prosecution in their amended complaint, that complaint does include allegations that the actions “were done knowingly, willfully, and with malicious intent.” The allegations seemed to the Court sufficient to inject into the slander of title cause of action an allegation of malice, even as to attorney Becker.

punchIn any event, the Court said, the law is clear that in evaluating a complaint against a general demurrer, it is not necessary that the cause of action be the one intended by plaintiff. The test is whether the complaint states any valid claim entitling plaintiff to relief. Thus, plaintiff may be mistaken as to the nature of the case, or the legal theory on which he or she can prevail. But if the essential facts of some valid cause of action is alleged, the complaint is good against a general demurrer.

The Court held that the absence of any suggestion in the Castelanellis’ opposition to Becker’s demurrer that they either wished to amend or intended to plead some sort of intentional tort via their fifth cause of action left the Court reluctant to rule that the trial court abused its discretion by sustaining the demurrer without leave to amend. Under all the circumstances, the Court thought the better course of action was to remand this matter to the trial court with instructions to consider whether any intentional tort — as distinguished from a claim of negligence — was in fact pled by the Castelanellis and (2) if not, whether the Castelanellis wish to and can plead a valid intentional tort cause of action against Becker regarding the allegedly improper lis pendens.

– Tom Root

TNLBGray

Case of the Day – Wednesday, August 12, 2020

POUNDING ON THE TABLE

The old trial strategy aphorism recommends that “if your case is weak on the law, pound on the facts; if it’s weak on the facts, pound on the law; and if it’s weak on the law AND facts, pound on the table.” 

transguide140519It doesn’t always work all that well, as our hapless landowners in today’s case, the Wimmers, found out.

“Wimmer” rhymes with “winners,” which is ironic given the outcome in this case. It seems the Wimmers owned land for which they had given the electric utility an easement for its power lines. That’s pretty common – anywhere power or communications lines cross over land, or pipes run under the ground, there’s probably an easement involved. The easement in the Wimmers’ case let Ohio Edison trim and remove trees as needed to keep vegetation clear of the lines.

The Wimmers didn’t want to see much of their foliage cut away, and because trimming and removing trees costs money, the utility didn’t want to do more than was absolutely necessary. Thus, there was a happy confluence of interest that continued for years.

transdanger140519Then came August 14, 2003. Some high-voltage transmission lines owned by the same Ohio Edison – hot from weather and the high electrical demand of the day – sagged into untrimmed trees just south of Cleveland. Three lines shorted out simultaneously. Normally, such a condition would have tripped an alarm at a monitoring center, letting technicians redistribute the load. But a bug in the software permitted what engineers call a “race condition,” and the alarms didn’t sound. The result was a cascading power failure that became the great North American Blackout of 2003, affecting 55 million people on the eastern seaboard and midwestern United States, as well as the province of Ontario.

After that day, everything changed. The public fumed, the media chastised, politicians fulminated. Changes had to be made. Ohio Edison was understandably humiliated by being the utility whose poor vegetation management started it all. Suddenly, occasional and desultory tree trimming became much more scorched earth. For the Wimmers, that meant that the power company’s crews showed up at their place one day to clear-cut the entire easement.

The family took exception to the plan, and sued to stop it. While their case was wending its way through the courts – not very satisfactorily to them, because Ohio Edison was winning every step of the way – the Ohio Supreme Court handed down its decision in Corrigan v. Illuminating Co. (which we, being the thorough types that we are) have discussed previously.  Corrigan held that vegetation management issues fell within the exclusive jurisdiction of the Public Utilities Commission of Ohio. Common pleas courts had no authority to decide whether tree trimming and removal within easements was prudent or unduly robust.

Mulligan140519The Wimmers recognized a break when they saw one, and promptly took a mulligan. Sadly, they fared no better before PUCO than they had in the state court system. That might be because Ohio Edison rolled out the IEEE standards for vegetation management to an expert witness who had inspected the easement, could identify the individual trees involved, and had facts and figure at her fingertips on the risk each tree posed to the power lines.

There wasn’t any question that the easement permitted Ohio Ed to cut down trees. The only issue was whether it was reasonably necessary. The Wimmers didn’t have any facts to counter the power company’s showing. They didn’t have any compelling legal arguments. All their lawyer could do was pound on the table, and argue that it was speculative that the trees would grow to be a hazard to the power lines.

Well, sure… the expert was only speculating that the trees would grow, and that they would reach the average height for that kind of tree, and for that matter, that there would ever be a high wind or ice storm that would cause them to ensnare the electric lines. Likewise, it’s speculation that the sun will rise in the morning, based on nothing more than a sheer guess loosely based on the fact that it’s done so for the past 1.6 trillion days since the earth was formed. You see where this is going?

Neither PUCO nor the Ohio Supreme Court – which reviewed the agency’s denial of the family’s complaint – was impressed with the Wimmers’ defense. “Who are you going to believe – me, or your own eyes?” their lawyer seemed to argue. The Commission and the Court both answered that question. Actual evidence carried the day.

Pound on the table, indeed.

Wimmer v. PUCO, 131 Ohio St.3d 283, 964 N.E.2d 411 (Sup.Ct. Ohio, 2012). Ohio Edison owned a transmission-line easement running over the Wimmers’ property. For years, Ohio Edison – in accordance with the company’s general policy – trimmed and once in a great while removed trees growing in the easement. But its policy changed after the 2003 Northeastern United States blackout. When the company tried remove all of the trees in the easement, the Wimmers sued to stop it. They went to court, where Ohio Edison won. But before the decision was final, the Ohio Supreme Court ruled in Corrigan v. Illuminating Co. that PUCO, not a court, was required to decide whether removal was reasonable.

The area of North America affected by the 2003 Blackout is marked in red.

The area of North America affected by the 2003 Blackout is marked in red.

The Wimmers then took their complaint to PUCO. After an evidentiary hearing, the commission ruled that Ohio Edison could remove the trees.

The Wimmers appealed.

Held: Ohio Edison was permitted to remove the trees. The Supreme Court held that there was “no question that the company has a valid easement,” that “the tree is within the easement,” and that the easement “grants the company the right to remove any tree within the easement that could pose a threat to the transmission lines.”

The Wimmers nevertheless argued that PUCO’s decision that the circumstances permitted Ohio Edison to remove the trees was not reasonable. They argued that Ohio Edison failed to present evidence that their trees “may interfere with or endanger the utility’s transmission lines.” The Wimmers maintained that the utility’s evidence was “long on Ohio Edison’s fear and speculation and short on hard facts.”

The Court disagreed. It found that evidence presented to the commission showed that “the vegetation in question has the genetic disposition to grow to heights tall enough to potentially interfere with” the power lines, and that Ohio Edison “reasonably determined that this vegetation may interfere or threaten to interfere with the transmission line and should be removed.” The utility had presented an expert witness who had described the trees growing in the right-of-way – which she had personally examined – and explained that their average mature heights were well above the height of the power lines. She had testified that “even with continuous trimming and pruning, at least one tree had already grown to within four feet of the line, in violation of the National Electrical Safety Code, which is published by the Institute of Electrical and Electronics Engineers and sets the industry-accepted safety standards.“

groucho140519The Wimmers didn’t present any contrary evidence or challenge the Ohio Edison witness’s credentials, but rather just complained that her testimony was speculative. In order to overturn PUCO’s determination, the Wimmers had to show that the decision was “so clearly unsupported by the record as to show misapprehension, mistake, or willful disregard of duty.” They did not come close to doing that.

The Ohio Supreme Court did, however, “note with approval the commission’s admonition that Ohio Edison ‘attempt to minimize the impact to property owners, to the extent possible and without sacrificing safety and reliability, when performing [utility-vegetation-management] activities’.” The Court dryly observed that “Ohio Edison must comply with the commission’s order.”

– Tom Root

TNLBGray140407

Case of the Day – Tuesday, August 11, 2020

OOPSIE!

OOPS sign with clipping pathAnyone can make a mistake. Or two.

Consider today’s case on mutual mistake. Mutual mistake is a doctrine that started with a barren cow with a fancy name, Rose 2nd of Aberlour (popularly mislabeled as “Aberlone”), in the case of Sherwood v. Walker, the classic case on mutual mistake in contract law. Well, maybe it didn’t start there, but a generation or two of law students think it did. Wherever it started,  the doctrine remains alive and well.

In today’s decision, Mr. Thomas entered into an easement with Ohio Power to let the company string lines across his place to service his neighbor’s new house. But it turned out the house was in another power company’s service area, something no one figured out until after Ohio Power had sliced up Mr. Thomas’s trees. Thomas sued Ohio Power to rescind the easement and for damages, claiming mutual mistake. The trial court disagreed, but the Court of Appeals threw out the easement.

The Court’s most important point was this: maybe Thomas and his neighbor Baker didn’t know where the electric service boundary lay. But after all, they weren’t in the power binness. Why should they know? Ohio Power, on the other hand, was just plain sloppy in not recognizing the problem. In Court-speak, “the equities of this situation show that Ohio Power, as the company in the business of providing electric power, was in a much better position than the Thomases to discover the mistake.”

mistakes141223In order to provide grounds to rescind (undo) a contract, the mistake must be mutual. The Battle of New Orleans was a mutual mistake – Andy Jackson thought we were at war with the British, and British Admiral Thomas Cochrane thought they were still at war with the U.S. Meanwhile, on the mythical planet of Tatooine, it appears that the mistake was not mutual – Obi-wan Kenobi was fully aware that the droids he was with were indeed the droids the storm troopers were looking for, but he led the storm troopers to believe otherwise. Not a mutual mistake at all.

Thomas v. Ohio Power Co., 2007 Ohio App. LEXIS 4715, 2007 WL 2892029, 2007 -Ohio- 5350 (Ct.App. Ohio, Sept. 27, 2007). The Thomases owned 159 acres of property in Augusta Township. Right next door was land owned by Brent Baker. The Thomas property is within the area served by Ohio Power Company, but the Baker property is served by Carroll Rural Electric Power. Neither of the power companies may provide power to the area assigned to the other without the consent of both companies and the affected customer.

Baker asked Thomas for permission for Ohio Power to take an easement across the Thomas property to bring power to a house Baker planned to build. Thomas agreed. As a result, an easement was executed, and Ohio Power — in reliance on the easement — cut and cleared many trees on the Thomas property and along the neighboring road. But then Baker found out the house wasn’t in the Ohio Power service area, and the other power company wouldn’t permit Ohio Power to provide service to him, frustrating the purpose for the easement. The Thomases sued Ohio Power, seeking rescission of the easement contract and damages. The trial court concluded that the easement was valid and, therefore, not subject to rescission.

The Thomases appealed.

Rose, not barren at all, was worth about 12 times what farmer Sherwood sold her for.

Rose, not barren at all, was worth about 12 times what farmer Sherwood sold her for.

Held: The parties had made a mutual mistake, and the contract should be rescinded. Mutual mistake is grounds for rescission of a contract if there is a mistake made by both parties as to a material part of the contract, and where the party complaining is not negligent in failing to discover the mistake. A mistake is material to a contract when it is “a mistake … as to a basic assumption on which the contract was made [that] has a material effect on the agreed exchange of performances.” Thus, the intention of the parties must have been frustrated by the mutual mistake.”

In order to claim mutual mistake as a basis for rescinding a contract, a complaint must allege (1) the existence of a contract; (2) a material mutual mistake by the parties when entering into the contract; and (3) no negligence in discovering the mistake on the complainant’s behalf. Here, the Court said, the purpose of the easement was to provide electric power to the Thomases’ neighbor. Both the Thomases and Ohio Power believed Ohio Power could provide electric power to that neighbor, but they were both mistaken about that fact. Ohio Power was in a better position to know that this belief was mistaken than the Thomases, and thus, the Court held, the contract should have been rescinded at the Thomases’ request.

– Tom Root

TNLBGray

Case of the Day – Monday, August 10, 2020


UNSNARLING DUTIES

negligence-overviewWhen negligence rears its ugly head, compensation usually depends on the extent of the duty owed the victim by the party whose pocket the injured plaintiff seeks to pick. Take Tim Jones, an experienced cable television installer. One cold day in the bleak midwinter, he climbed an Indiana Bell pole to work on a cable installation. On the way down, he grabbed a phone line instead of a ladder rung. Not being intended as a support structure, the line gave way, and down Mr. Jones went.

Having no evidence that Indiana Bell knew the line was defective and likely to fall away from the pole, Mr. Jones did the only thing he could do – he sued anyway. The issue was a little daunting, because Indiana Bell hadn’t ever hired Mr. Jones. Instead, it just rented pole space to the cable company, which in turn hired the company that employed Jones. So what duty did the telephone company owe Jones in this totem-pole relationship?

Not that much of one, as it turned out. Mr. Jones lost his case, but the Court of Appeals took the opportunity to clarify the duty an easement holder has to invitees on the easement. The lesson is one that a utility holding an easement for, say, power lines, might owe to the employee of a tree-trimming service brought in to keep the easement clear of vegetation.

Jones v. Indiana Bell Telephone Co., 854 N.E.2d 1125 (Ind.App., 2007). Timothy Jones was doing a cable equipment upgrade for Sentry Cable, a cable TV provider. Jones – who had been doing this type of work for about twenty years and was aware of the associated dangers – was working as a subcontractor on this project. He was wearing the appropriate safety equipment.

The plucky old Field Marshal might have been Jones' lawyer here ... but the attack failed nonetheless.

The plucky old Field Marshal might have been Jones’ lawyer in this case … but the legal attack on the easement holder failed nonetheless.

Jones climbed a telephone pole owned by Indiana Bell, in order to access the cable TV line, which was located about a foot above the telephone line. On his way down, he grabbed the telephone line like it was a ladder rung. It wasn’t. It broke free, and Jones fell 20 feet to the ground, breaking his ankle. Jones sued the phone company for negligence.

At trial, Jones admitted he hadn’t observed any problems with either the telephone line or the clamp assembly. He also admitted he had no evidence that Indiana Bell knew that there was anything wrong with the pole, telephone line, or clamp assembly. Indiana Bell moved for judgment “based upon the … absence of any evidence of a breach of duty as the duty is established in Indiana law.” The trial court found Indiana Bell had no duty to Jones, and granted judgment to the phone company.

Jones appealed.

Held: Indiana Bell owed Jones nothing.

The Court observed that to prevail on a theory of negligence, Jones had to show Indiana Bell owed him a duty, it breached the duty, and his injuries were caused by the breach. Whether a defendant owes a duty of care to a plaintiff is a question of law for the court to decide. Whether an act or omission is a breach of one’s duty is generally a question of fact for the jury, but it can be a question of law where the facts are undisputed and only a single inference can be drawn from those facts.

The parties and the Court focused on the Indiana Supreme Court’s opinion in Sowers v. Tri-County Telephone Co., which involved a telephone utility, the employee of an independent contractor, and a discussion of both duty and breach. In Sowers, the telephone company hired Covered Bridge Tree Service to trim trees located near its telephone lines and clear a right of way in order to ease the work of crews mounting cable television lines on the same poles. While trimming trees, a Covered Bridge employee fell into an abandoned manhole.

manhangfromtelephonepole140603The phone company did not own the land on which the manhole was located, but it had a prescriptive easement on the land. Sowers sued Tri-County for negligence, and the trial court granted summary judgment in favor of Tri-County. The Sowers court held that a landowner or occupier is under a duty to exercise reasonable care for the protection of business invitees and that the employees of independent contractors are business invitees. The court held that Tri-County did not have a duty to inspect and warn and that the boundaries of Tri-County’s duty of reasonable care to its business invitees “must be defined from the utility’s own use of the easement.”

But here, the Court said, the facts of Sowers were distinguishable (which means that they make the case different, not that there was anything especially celebratory about them). There, the telephone utility itself hired the tree service company, whose employee was then injured while on the telephone utility’s easement. Here, Indiana Bell just rented space on its telephone poles to the cable company, whose subcontractor was then injured on Indiana Bell’s telephone pole. Still, the Court said, the policy reasons articulated in Sowers apply to this case, making the duties owed the same. Sowers first acknowledged that a telephone utility is a special breed in that it is not a traditional landowner or occupier. In addition, it acknowledged that a telephone utility does not often access its property except for the occasional necessity to effect repairs. Because of these facts, Sowers concluded that a great burden would be placed on a telephone utility if it were required to conduct regular inspections of its property for the sole purpose of discovering possible hazards.

Applying Sowers here, the Court concluded, Indiana Bell owed a duty of reasonable care to its invitees – including Jones – but the duty did not include the duty to inspect and warn. However, to the extent that Indiana Bell learned of dangerous conditions on its poles, it had a duty to warn its invitees. The evidence did not show Indiana Bell had any actual knowledge of the dangerous condition, meaning that the trial court properly entered judgment on the evidence in favor of Indiana Bell.

– Tom Root