Opinion
NO. 2012-CA-000301-MR
02-27-2015
EQT GATHERING, LLC APPELLANT v. NELLIE FLEMING, INDIVIDUALLY AND AS POWER OF ATTORNEY FOR CARL BENTLEY, HERBERT BENTLEY, AND BILLY JOE BENTLEY APPELLEE
BRIEF FOR APPELLANT: Michael J. Schmitt David M. Runyon Paintsville, Kentucky BRIEF FOR APPELLEE: Adam P. Collins Hindman, Kentucky
NOT TO BE PUBLISHED APPEAL FROM PIKE CIRCUIT COURT
HONORABLE STEVEN D. COMBS, JUDGE
ACTION NO. 09-CI-00431
OPINION
VACATING AND REMANDING
BEFORE: KRAMER, J. LAMBERT, AND NICKELL, JUDGES. KRAMER, JUDGE: The above-captioned appellee filed a trespass action against EQT Gathering, Inc., in Pike Circuit Court. Following a judgment in the appellee's favor, EQT now appeals. Upon review, we vacate and remand for further proceedings not inconsistent with this opinion.
By way of background, the appellee's trespass action against EQT asserted that in the summer or fall of 2008, EQT had, without the appellee's consent, placed approximately one hundred and fifty feet of natural gas pipeline across wooded and largely unimproved property they claimed to own in Pike County. EQT defended by contending that its pipeline was not on the appellee's property, but was instead on neighboring property owned by the heirs of Rusha and Barbara Meade (the "Meade heirs"), with the Meade heirs' permission. Alternatively, EQT contended that if its pipeline was on the appellee's property: (1) it could not be sued for trespass, and could only be sued for "reverse condemnation"; or, failing that, (2) its trespass was not indicative of bad faith and did not warrant punitive damages.
Following a period of motion practice, the circuit court rejected EQT's reverse condemnation argument. Following a trial, the circuit court partially directed a verdict in favor of the appellee, holding that EQT's pipeline was indeed located on the appellee's property. Thereafter, a jury determined that EQT's trespass was indicative of bad faith; in addition to awarding the appellee $15,000 in compensatory damages for trespass, the jury awarded punitive damages in the amount of $75,000.
With that said, EQT's first argument on appeal is that the circuit court committed error in directing a partial verdict in favor of the appellee. The substance of the circuit court's directed verdict, as it appeared in "Jury Instruction No. 2," was:
The Court has found, and you are instructed, that [EQT] entered upon the [appellee's] property to place the gas pipeline currently located there, without any right or permission to do so.
As to how the circuit court erred, EQT points out that the evidence conflicted regarding the extent and nature of its trespass upon the appellee's property. EQT notes that its expert surveyor, Tommy Wright, testified and compiled a survey indicating (1) no part of its gas pipeline entered the boundaries of the appellee's property; and (2) EQT merely caused surface damage to approximately 562 square feet of the appellee's property.
In rebuttal, the appellee makes the following argument in her brief:
While [EQT] may argue that it did not place the pipeline on the property and that it presented evidence to that effect, the location of the pipeline became immaterial to the issue of whether [EQT] trespassed after this admission [regarding the 562 square feet of surface damage]. This is because the Court did not issue a directed verdict on the amount of trespass damages. All the Court found was that [EQT] had trespassed upon the property. Clearly, the Court made this ruling because [EQT's] own expert admitted that [EQT] had entered and caused damage on the property and [EQT] presented absolutely no proof that it had the right or permission to be on the property. Further, there was uncontroverted evidence presented that the [appellees'] boundary fence had been destroyed during the installation of the pipeline.
When ruling on a motion for directed verdict, the trial court must consider all of the evidence adduced at trial in the light most favorable to the non- moving party. Taylor v. Kennedy, 700 S.W.2d 415, 416 (Ky. App. 1985). The court may not grant a motion for directed verdict "unless there is a complete absence of proof on a material issue in the action, or if no disputed issue of fact exists upon which reasonable men could differ." Id. Here, the appellee does not deny that Wright's testimony and accompanying survey constituted some evidence supporting that EQT's pipeline did not traverse any part of their tract. Wright's credentials were never questioned; his survey depicts the path of EQT's pipeline progressing exclusively through the neighboring tract belonging to the Meade heirs; and, Wright testified that he compiled his survey after reviewing the appellee's and the Meade deeds, and according to accepted surveying practices.
Nevertheless, the circuit court either disregarded Wright's testimony and survey, or found that it was less credible than the appellee's boundary evidence. In either event, it would appear that the circuit court abused its discretion by preemptively instructing the jury that EQT's pipeline was located on the appellee's property. Moreover, in dictating the nature and extent of EQT's trespass, the circuit court's error could not have been "immaterial" as represented by the appellee because it necessarily influenced the jury's award of trespass damages. That much is apparent from a review of the appellee's closing arguments, wherein the appellee requested $15,000 in compensatory damages and a multiple of $15,000 in punitive damages to represent what they purported was the permanent loss of value of their land due to EQT's installation of its gas pipeline across their property—not the 562 square feet of surface damage described by Wright, which was the extent of EQT's non-disputed trespass. As noted, the appellee was awarded $15,000 in compensatory damages and $75,000 (i.e., $15,000 multiplied five times) in punitive damages.
Regardless, EQT's argument is largely a moot point. This is because it brings a deeper and more dispositive issue to light.
In a trespass action, the burden is upon the plaintiff to locate his property boundaries and show that the act or acts constituting the trespass occurred within those boundaries. Bryant v. Perry, 284 Ky. 698, 145 S.W.2d 1055, 1057 (1940). Here, EQT was authorized by the owners of the neighboring tract, the Meade heirs, to install its gas pipeline on their property. EQT also produced evidence (i.e., Wright's testimony and survey) supporting that its pipeline was within the Meade heirs' tract. Conversely, the appellee produced evidence that EQT's pipeline was within their own tract. Thus, in resolving the ultimate location of EQT's pipeline, and to determine whether any kind of trespass occurred, the circuit court was first required to resolve an underlying controversy: the location of the appellee's common boundary with the Meade heirs.
The appellee's evidence regarding ownership of the property in question consisted of testimony regarding their recollections of conversations with their neighbors on the topic of boundary locations; it also consisted of evidence of fencing in the area, which the appellee contended demonstrated either adverse possession or an agreed boundary line.
Generally speaking, issues regarding boundary lines and title to real estate are questions of law that fall under the circuit court's jurisdiction specified in either KRS 411.120, or the general declaratory action statute, KRS 418.040 et seq.; they are also subject to applicable limitations established by the legislature and the assorted rules and precedents of our Courts. Whitley v. Robertson County, 396 S.W.3d 890, 897-99 (Ky. 2013). An important limitation established by the legislature is that "all persons shall be made parties who have or claim any interest which would be affected by the declaration, and no declaration shall prejudice the rights of persons not parties to the proceeding." KRS 418.075. Another limitation is specified in KRS 418.065, which provides:
The court may refuse to exercise the power to declare rights, duties or other legal relations in any case where a decision under it would not terminate the uncertainty or controversy which gave rise to the action, or in any case where the declaration or construction is not necessary or proper at the time under all the circumstances. The appellate court in its consideration of the case, shall not be confined to errors alleged or apparent in the record. When, in its opinion, further pleadings or proof is necessary to a final and correct decision of the matters involved, or that should be involved, it shall remand the case for that purpose; or if in its opinion the action is prematurely brought, or where a ruling in the appellate court is not considered necessary or proper at the time under all the circumstances, it may direct a dismissal without prejudice in the lower court.
The Meade heirs certainly have an interest that has been affected by a determination of the circuit court; by determining that the pipeline was on the appellee's property, the circuit court necessarily located and established the common boundary separating the Meade heirs' property from the appellee's property. But, no attempt has ever been made to join the Meade heirs as parties to this litigation. In spite of EQT's concession of a "562 square foot" trespass, there is no indication from the record that the Meade heirs authorized EQT to establish, or represent their interests in any determination of, their common boundary line with the appellee. Nor, for that matter, is there any indication that the Meade heirs otherwise disclaimed any interest in the location of their common boundary line. Accordingly, the circuit court resolved the issue of EQT's trespass by determining, in a vacuum, a common boundary line between two adjoining properties. This was improper. See Baker v. Weinberg, 266 S.W.3d 827, 831-32 (Ky. 2008). Moreover, the circuit court's determination could not have validly established the common boundary line in the absence of the Meade heirs, and, therefore, it did not terminate the uncertainty or controversy which gave rise to the appellee's trespass action. See KRS 418.065.
EQT's remaining arguments on appeal address the issue of whether the circuit court erred in refusing to recharacterize the appellee's trespass action as a claim of "reverse condemnation." However, because a proper adjudication locating the boundary between the appellee's and the Meade heirs' respective properties could potentially result in a determination that EQT was not on the appellee's property at all, any decision the circuit court made that was directed toward that issue was impermissibly premature, and any comment from this Court on that subject would constitute an unauthorized advisory opinion. See Commonwealth v. Hughes, 873 S.W.2d 828, 829 (Ky. 1994) (reaffirming that courts have "no jurisdiction to decide issues which do not derive from an actual case or controversy.")
In short, we VACATE the judgment of the Pike Circuit Court and REMAND for further proceedings not inconsistent with this opinion. In particular, the circuit court shall either dismiss the appellee's trespass action without prejudice, or it shall take the following steps before again attempting to resolve it on the merits: (1) join the Meade heirs or any individual or individuals claiming an interest in the Meade tract as parties to this litigation; (2) provide those individuals with a reasonable opportunity to assert and offer proof regarding the location of their common boundary with the appellee; and (3) adjudicate, as a final matter, the location of the common boundary line separating the Meade heirs' tract from the appellee's tract based upon the record and any further pleadings or proof. Once the boundary line is properly determined, the circuit court may revisit the questions raised in this matter including, but not limited to: (1) whether, to what extent, and under what circumstances (e.g., by virtue of an honest mistake or as the result of a willful disregard of the appellee's rights) EQT's gas pipelines entered the appellee's property; and, (2) whether the appellee's action against EQT should be characterized under Kentucky law as either trespass or a claim of reverse condemnation.
ALL CONCUR. BRIEF FOR APPELLANT: Michael J. Schmitt
David M. Runyon
Paintsville, Kentucky
BRIEF FOR APPELLEE: Adam P. Collins
Hindman, Kentucky