Opinion
C. A. WC-2017-0252
02-08-2021
ESTATE OF JAMES F. ROSSI v. KASSANDRA CLAIRE PROPERTIES, LLC and STEVEN J. LAFAZIA
For Plaintiff: Thomas J. Capalbo, III, Esq. For Defendant: Daryl E. Dayian, Esq.
For Plaintiff: Thomas J. Capalbo, III, Esq.
For Defendant: Daryl E. Dayian, Esq.
DECISION
TAFT-CARTER, J.
Before the Court for decision following a non-jury trial is Plaintiff Estate of James F. Rossi's (Plaintiff) Complaint pursuant to G.L. 1956 § 34-20-1 and negligence, as well as the Defendants' Kassandra Claire Properties, LLC (KCP) and Steven J. Lafazia (Lafazia) (collectively, Defendants) counterclaim for slander of title. The parties appeared before the Court for trial without a jury on October 8, 9, and 10, 2019. The Court has jurisdiction pursuant to Rule 52(a) of the Superior Court Rules of Civil Procedure (Rule 52(a)) and G.L. 1956 § 8-2-14(a).
James Rossi died on July 19, 2019, and the Court substituted his estate as Plaintiff on September 25, 2019. See Pl.'s Suggestion of Death; Mot. of Sept. 5, 2019.
I
Facts and Travel
The Court, after reviewing the evidence presented at trial, finds the following facts.
A. Tree Cutting
James Rossi and his wife Bertha Rossi purchased 46 Langworthy Road (Lot 75) in the Town of Westerly, Rhode Island on October 9, 1991. See Pl.'s Trial Ex. 1; Am. Compl. ¶ 5. The property is also described as Westerly Tax Assessor's Plat 122, Lot 75. See Trial Tr. (Tr.) at 65:9-14.
Bertha Rossi died in 2009. See Tr. at 158:14-159:2; Am. Compl. ¶ 5.
At some point after Mr. and Mrs. Rossi purchased Lot 75, seven Norway spruce trees were planted on the eastern side of the property to shade and protect the area where the Rossis spent most of their time outdoors. (Tr. at 164:1-10.) The trees were planted as a privacy screen. Id. at 164:11-13. While there was some dispute as to whether the trees were planted on Lot 75, the credible evidence elicited at trial through the testimony of surveyor Alfred DiOrio clearly establishes that the trees were located on Lot 75. Id. at 77:4-80:7; see Pl.'s Trial Ex. 2 (Final Survey). In fact, three of the Norway spruce trees were within two-and-one-half feet of an abutting, vacant lot described as Westerly Tax Assessor's Plat 122, Lot 74 (Lot 74). Id. at 66:14-17. KCP purchased Lot 74 on October 3, 2016. See Final Survey. According to Mr. Lafazia, the principal and owner of KCP, his intention was to build and sell a residential dwelling. (Tr. at 302:10-16.) When KCP purchased Lot 74, it was overgrown and inaccessible due to weeds and other growth. Id. at 203:13-19; 303:2-6; 304:9-25; 353:1-13.
The overgrowth on Lot 74 included the area abutting Lot 75. Id. at 353:1-21. While the record clearly indicates that Mr. Rossi cared for the area around the Norway spruce trees until he was unable to do so, the credible evidence establishes that the area around the trees became overgrown and unkept. Id. at 164:14-166:13. The conditions of the area, including the area surrounding the trees on Lots 74 and 75, required maintenance such as the clearing and removal of the overgrowth of brush and vines. Id. at 338:24-339:8; 353:8-13.
The middle grouping of the Norway spruce trees was particularly overgrown with vines and poison ivy. Id. at 253:16-20; Defs.' Trial Ex. E, 27. Mr. Lafazia credibly testified that there were dead branches throughout the trees. (Tr. at 304:9-13.) The overgrowth was so severe that there was "no green growth" on the trees showing on his side of the property. See id. at 238:20-22; 304:9-13; Defs.' Trial Ex. E, 17; Am. Compl. ¶ 6. One side of the Norway spruce trees consisted of dead branches and vines that pulled the tops of the spruce trees down. (Tr. at 304:9-25.) Because of these conditions, Mr. Lafazia testified that on March 22 or 23, 2017, KCP employees cleared the area around the trees on Lot 74 and cut the top one-third of five of the spruce trees. (Tr. at 302:20-304:25.) During the trial, the Plaintiff argued and presented evidence that six of the seven trees were cut; however, the Court finds that five of the trees were cut, based on the credible testimony of Messrs. DiOrio and Lafazia and reliable photographic evidence. Id. at 29:24-25; 248:9-249:23; Defs.' Trial Ex. E, 18-23.
On March 23, 2017, Jacqueline Spiers, James Rossi's granddaughter and caregiver, went to visit Mr. Rossi at his home. (Tr. at 166:14-19.) Upon Ms. Spiers' arrival, she observed that the Norway spruce trees were cut in a flat line with the trees' tops laying on the ground. Id. Ms. Spiers discussed this issue with her grandfather and confirmed that he had not given his consent to cut the trees. Id. at 166:20-167:3. As a result, Ms. Spiers traveled to the Westerly police station to report the damage to the trees. Id. at 167:1-5; 179:20-180:7. Westerly police Officer Howard J. Mills (Officer Mills) traveled to Mr. Rossi's property to investigate Ms. Spiers' complaint. Id. at 167:6-9. Officer Mills did not take any photographs or measurements of the trees or surrounding area. Id. at 13:5-8. Officer Mills testified that he "had no way to determine" fault or ownership of the trees. Id. at 11:8-10.
On the same day that Ms. Spiers went to the Westerly police, she engaged the services of Fields of Dreams, a landscaping company owned by Shawn Ward, a friend and former colleague. Id. at 19:3-15; 184:11-14. Mr. Ward was called upon to conduct a site inspection and give a quote on replacing the line of seven Norway spruce trees. Id. at 39:18-23. Mr. Ward initially understood that all seven trees were damaged and required replacement. Id. at 39:24-40:2. Mr. Ward prepared a removal and replacement quote dated March 21, 2017. Id. at 42:7-10; 184:11-24. Prior to the trial, Mr. Ward returned to the property and saw that the trees were alive. Id. at 43:21-44:12.
Mr. Ward acknowledged that he never reviewed his invoice and that it was in fact erroneous. Id. at 31:6-35:25; 37:5-9; 41:24-42:12; 184:15-20. While his initial work and calculations were sloppy, Mr. Ward was able to account for his previous errors as he provided credible figures during trial. Id. at 31:10-35:25; 37:5-9; 184:15-20. Mr. Ward calculated while testifying that the actual replacement value of six trees was $50,742. Id.
First, the quote listed the freight charge as being $2250. (Tr. at 31:20-33:8.) This amount was for one tree only. Id. Mr. Ward edited the freight charge while testifying to be $13,500, a difference of $11,250 between his trial testimony and his provided quote. Id. Second, the quote listed a date of March 21, 2017, prior to when Ms. Spiers hired Mr. Ward. Id. at 37:5-9. Mr. Ward testified that this error occurred because of the retirement of his previous secretary. Id. at 31:20-25. However, Mr. Ward also testified that he did not read the quote prior to sending it to Ms. Spiers and that such errors occurred "more often than not." Id. at 31:6-15; 41:24-42:12. Third, Mr. Ward testified that the quote reflected the replacement value of seven, not six, trees. Id. at 29:18-30:7. Mr. Ward admitted that his 2017 estimate was totally incorrect because of this miscalculation of seven trees to be replaced, rather than six. Id. at 37:5-9.
B. Lis Pendens
Mr. DiOrio prepared a preliminary survey on April 10, 2017, which he provided to Mr. Rossi's family indicating that the trees were located on their lot. Id. at 64:1-6. The survey was not completed in final form until November 28, 2018. Id. at 78:4-9; Final Survey. Mr. DiOrio stated that in April 2017 he could not say with confidence that the trees were on Lot 75. Id. at 80:8-16. However, the Final Survey established that the trees were on Lot 75. See Final Survey.
After receiving the preliminary survey from Mr. DiOrio, on May 25, 2017 the Plaintiff recorded a Notice of Lis Pendens in Westerly land records. See Defs.' Trial Ex. 4 (Lis Pendens); Tr. at 110:23-25. The Lis Pendens stated that it concerned an interest in real estate located at 44 Langworthy Road, also described as Lot 74 on Assessor's Plat 122. See Lis Pendens. The Lis Pendens further stated that the "substance of [the] dispute concern[ed] a boundary line dispute resulting in a trespass and the unauthorized cutting of trees by the [Defendants]." See id.
In 2017, KCP was in the process of selling the then-developed lot. Tr. at 141:7-25. On January 3, 2018, KCP entered into a purchase and sale agreement with Daniel R. and Carole A. O'Malley for Lot 74. Id. at 139:1-141:8; 153:5-6; 290:23-24; 308:14-18; Defs.' Trial Ex. A. The purchase and sale agreement with the O'Malleys specified a price of $575,000. (Tr. at 308:14-18.)
The Defendants agreed to extend the closing with the O'Malleys because, initially, the house had yet to be completed and the O'Malleys desired certain aspects to be upgraded. Id. at 141:7-13. The closing between the O'Malleys and KCP was extended four times because of this. Id. at 141:20-25. However, in the end, the cloud on the title from the Lis Pendens precluded the O'Malleys from purchasing Lot 74. Id. at 142:1-14; 146:1-4; 195:18-22; 291:7-25; Lis Pendens.
The O'Malleys' attorney, Kirsten Stackpole, found the Lis Pendens during a title search and was unable to resolve the issue that created this cloud on the title and prevented the closing from occurring. (Tr. 153:19-154:12.) The Lis Pendens caused Attorney Stackpole to write a letter expressing the O'Malleys' desire to be released from the purchase and sale agreement. Id. at 155:3-14. The letter stated that if KCP could not obtain marketable title, the O'Malleys desired a release from the purchase and sale agreement and a return of their deposits. Id.; see Defs.' Trial Ex. B.
At the end of 2018 or the start of 2019, a second buyer appeared and expressed interest in Lot 74. (Tr. at 294:12-19.) The record does not establish that the second buyer entered into a purchase and sale agreement. Id. However, according to the credible testimony of Attorney Joseph Raheb, the Lis Pendens precluded this second potential sale from occurring. Id. at 294:12-19; 295:9-18; 297:17-298:1.
The inability to sell the property because of the Lis Pendens resulted in the Defendants' lender, who supplied the funding for the construction, initiating foreclosure proceedings in February 2019. Id. at 292:4-294:11; 295:9-18. At that time, the construction loan had an outstanding balance of $400,000, with interest and attorney's fees totaling $143,836.69. Id. at 293:9-15. The per diem interest rate was $197.26. Id. at 293:19-20. To date, the lender has not recorded the foreclosure deed because of the expense involved in recording. Id. at 295:9-18.
C. Travel
The Plaintiff filed a Complaint on May 23, 2017, bringing claims under § 34-20-1 and common law negligence. (Compl. ¶¶ 22-39.) An Amended Complaint was filed on March 16, 2018 that added an adverse possession claim under G.L. 1956 § 34-7-1. Id. at ¶¶ 37-43. The Defendants filed a counterclaim for slander of title against the Plaintiff on April 27, 2018 because the Lis Pendens caused the O'Malleys to rescind the purchase and sale agreement and dissuaded the second pair of buyers. (Am. Answer and Counterclaim ¶¶ 11-12.)
The Court dismissed the adverse possession claim under Rule 50 of the Superior Court Rules of Civil Procedure on Defendants' motion for judgment as a matter of law. (Tr. at 223:11-224:19.)
This action proceeded to trial before the Court without a jury on October 8, 9, and 10, 2019. The Plaintiff presented the following witnesses: Officer Howard J. Mills of the Westerly police; Shawn Ward as an expert in tree replacement valuation; Alfred DiOrio as an expert in surveying; and Clement Desjardins as an expert in arboriculture. See Tr. Index. The Defendants presented the following witnesses: Sandra L. Bliven; Kirsten Stackpole, Esq.; Jacqueline Spiers; Marc Lawrence as an expert in arboriculture; Joseph Raheb, Esq.; and Steven J. Lafazia. Id.
At trial, the Court requested the parties to provide post-trial briefs on the remaining issues: (1) Count II under § 34-20-1; (2) Count III for negligence; and (3) Defendants' counterclaim of slander of title. (Tr. at 362:21-363:1.) The Court now renders its decision.
II
Standard of Review
Under Rule 52(a), "[i]n all actions tried upon the facts without a jury . . . the court shall find the facts specially and state separately its conclusions of law thereon[.]" "[The Court] weighs and considers the evidence, passes upon the credibility of the witnesses, and draws proper inferences." Hood v. Hawkins, 478 A.2d 181, 184 (R.I. 1984). "The task of determining the credibility of witnesses is peculiarly the function of [the Court] when sitting without a jury." Walton v. Baird, 433 A.2d 963, 964 (R.I. 1981) (citation omitted).
III
The Defendants maintain that the Plaintiff failed to produce testimony from a representative of the Estate of James Rossi, and thus, the Plaintiff's claims must fail. See Defs.' Post-Trial Mem. 3; 19; 27. However, the Defendants do not cite any law in support of this argument. Id. The Court finds this argument unpersuasive. See Super. R. Civ. P. 43(a) ("All evidence shall be admitted which is admissible under the statutes of this state or under the Rhode Island Rules of Evidence. The competency of a witness to testify shall be determined in like manner."); see also R.I. R. Evid. 601 ("Every person is competent to be a witness except as otherwise provided in these rules or by statute"); R.I. R. Evid. 602 (a witness must have personal knowledge to testify). The Defendants do not challenge any witness's personal knowledge or competency, only that a representative of the Estate of James Rossi did not testify; the Court is not aware of any such requirement in Rhode Island law.
A. Liability for unauthorized cutting of trees pursuant to § 34-20-1
The Plaintiff alleges that the Defendants cut six of the Norway spruce trees on Lot 75 in violation of § 34-20-1. See Pl.'s Post-Trial Mem. (P. Mem.) 3. The Plaintiff seeks double the replacement value of the Norway spruce trees as damages Id. at 3; 24.
The Defendants argue that the trees were not "cut," "destroy[ed]," or "carr[ied] away" within the meaning of § 34-20-1 and that Plaintiff failed to establish damages. See Defs.' Post-Trial Mem. (D. Mem.) 21-22. The Defendants support this argument by claiming that they have a common law right to cut overhanging brush on their property and trimming the trees improved their health. See id.
i. Cutting the Trees
To prevail on a claim for unauthorized cutting of trees in violation of § 34-20-1, a plaintiff must prove by a preponderance of the evidence that:
1. The defendant cut; destroyed; or carried away any tree, timber, wood, or underwood;
2. Lying or growing on the plaintiff's land; and
3. Without the consent of the owner of the land.See Hickey v. Town of Burrillville, 713 A.2d 781, 784 (R.I. 1998); Sklut v. R.I. Camera Repair, Inc., PC-1974-1825, 1976 WL 177083, *2 Bourcier, J. (May 13, 1976). The statute provides for double damages for the value of the wood cut without consent. See § 34-20-1. The recovery of damages for an unauthorized cutting of trees is not conditioned upon proof that the wrongdoer was trespassing upon the tree owner's land. See Hickey, 713 A.2d at 786.
"Every person who shall cut, destroy, or carry away any tree, timber, wood or underwood whatsoever, lying or growing on the land of any other person, without leave of the owner thereof, shall, for every such trespass, pay the party injured twice the value of any tree so cut, destroyed, or carried away[.]" See § 34-20-1.
As stated above, the clear and credible record demonstrates that the Defendants trimmed and cut five Norway spruce trees located on Lot 75. See Tr. at 132:4-9; 166:14-168:11; 299:13-300:8; 339:3-8; 339:22-340:2; Final Survey. While the Plaintiff argues that six trees were cut, testimony from Messrs. DiOrio and Lafazia, in addition to photographic evidence, establishes that five trees were cut. Id. at 29:24-25; 248:9-249:23; Defs.' Trial Ex. E 18-23. Mr. Lafazia also credibly testified that KCP's employees "trimmed the trees." (Tr. at 339:3-8.) See § 34-20-1; see also Webster's Dictionary (11th ed. 2020) (to "cut" is to "trim, pare"). Furthermore, there is no dispute that the Defendants did not have consent to cut the Norway spruce trees; indeed, Mr. Lafazia admitted that he did not have Mr. Rossi's consent. Id. at 166:14-168:11; 339:22-340:2. Thus, the Plaintiff has demonstrated by a preponderance of the evidence that the Defendants through their employees "cut" five Norway spruce trees without Mr. Rossi's consent in violation of § 34-20-1.
There is a clear recognition under Rhode Island common law that allows landowners to cut tree limbs and branches that overhang or encroach onto their property. See Rosa v. Oliveira, 115 R.I. 277, 285, 342 A.2d 601, 605 (1975) (finding that counterclaim defendant failed to prove that the neighbor damaged trees on the defendant's side of the property).
Here, despite testimony from the Plaintiff stating otherwise, the record establishes that area surrounding the trees was not maintained. (Tr. at 165:10-20; 205:7-206:16.) The overgrown state of the property surrounding the trees was credibly and reliably established through testimony and photographic evidence. See Defs.' Trial Ex. E 6-7; 19; 20; 23; Tr. at 165:10-20; 352:21-353:13. Indeed, Mr. Lawrence credibly testified that the Defendants' trimming of the underbrush and the removal of vines constituted maintenance that allowed the trees to grow and prosper in a better, healthier state. (Tr. at 261:5-16.)
However, while Mr. Lawrence believed that the removal of approximately one-third from the tops of the trees would be consistent with the goal of removing potential "liability" from the tops of the trees and that the Defendants had the right to trim the trees, the Court finds this testimony unreliable and not credible in light of the testimony from Mr. Lafazia indicating the removal of the tops was needed for an ocean view from the third floor of the house that KCP built. Id. at 260:18-262:3; 301:21-25; 349:7-10. This removal is distinguishable from the trimming of the trees to prevent vegetation from encroaching onto Lot 74. Id. at 279:2-280:21; 348:4-349:10. There was no legal right to cut the top one-third off the five Norway spruce trees. See Rosa, supra.
While the Defendants had the right under Rosa to clear undergrowth and remove any tree limbs that encroached onto Lot 74, the Defendants did not have the right to cut the tops off the trees; therefore, Plaintiff established under § 34-20-1 that the Defendants impermissibly cut the tops of five Norway spruce trees. See Rosa, supra.
ii. Damages under § 34-20-1
To establish damages under § 34-20-1, "[a] complaining party need not prove damages with mathematical exactitude . . . . All that is required is that they are based on reasonable and probable estimates." See Morabit v. Hoag, 80 A.3d 1, 15 (R.I. 2013) (brackets and quotations omitted). Rhode Island law uses a factor-based analysis to calculate damages under § 34-20-1. See id. at 16-19. The damages analysis depends on whether the trees have value primarily as harvestable timber, such as commercial trees growing on a woodlot, or an aesthetic or sentimental value typical of a small number of trees on a small parcel. See id. at 16-17.
The available damages for non-commercial trees, such as the Norway spruce trees that Mr. Rossi planted on his property, are either diminution of market value or replacement costs, with the deciding factor being whether the trees had a peculiar value to the landowner. See id. "[T]o determine when restoration costs in excess of the diminution of the value of the property may be appropriate, courts have focused on whether there is a 'reason personal' to the landowner for restoring the trees[.]" See id. at 17. Courts may award restoration values when the value is reasonable "in relation to the change in the value of the property." See id. at 18.
The Plaintiff did not introduce evidence that established how much its property decreased in value from the Defendants' trimming of the trees. See Tr. at 121:9-16; 130:12-22; 170:1-9. The Plaintiff did, however, introduce evidence through Mr. Desjardins and Ms. Spiers that the trees had a reduced value as a privacy and wind screen. Id. at 129:11-16; 170:1-9. Ms. Spiers also testified that Mr. Rossi gardened and maintained the area around the trees prior to his medical issues preventing him from doing so. Id. at 161:14-162:10. Thus, replacement value is warranted here because of the "reason personal" to Mr. Rossi; the Norway spruce trees served as a privacy and wind screen and had sentimental value. See Morabit, 80 A.3d at 17-18.
Furthermore, the Court finds that Mr. Ward credibly testified to the individual replacement value of the trees. (Tr. at 35:15-36:14.) While Mr. Ward's quote was not admitted into evidence because of its various inaccuracies, he was able to testify to the itemized costs of replacing the damaged trees and replacement costs to plant new trees. Id. Using Mr. Ward's testimony regarding the replacement costs, the Court finds that the Plaintiff is entitled to $84,570 under § 34-20-1.
Based on the Court's finding that five trees were damaged, it reaches the above-stated damages figure based on the following calculations:
See Tr. at 35:15-36:14.
Removal of damaged trees:
$171 per tree x 5 trees =
$ 855
Cost of new trees:
$4800 per tree x 5 trees =
$ 24, 000
Sales tax:
$24,000 x 0.07 sales tax rate =
$ 1, 680
Labor to plant new trees:
$900 per tree x 5 trees =
$ 4, 500
Shipping of new trees:
$2250 per tree x 5 trees =
$ 11, 250
Sum of replacing five trees:
$ 42, 285
Doubled damages:
$42,285 x 2 =
$ 84, 570
The Court also notes that this amount is reasonable in view of the Plaintiff's assessed land value of $115,500. See Defs.' Trial Ex. G. Norway spruce trees may grow eighty to ninety feet tall in New England. (Tr. at 106:16-107:8.) Finally, there is evidence that the Defendants trimmed the trees to obtain an ocean view for the home built on Lot 74. Id. at 301:21-25; 349:7-10.
B. Negligence
The Plaintiff's second claim is that Defendants were negligent in trimming vegetation that was not on Lot 74. (Am. Compl. ¶¶ 53-62; Tr. at 224:20.) "To prevail on a claim of negligence, a plaintiff must establish a legally cognizable duty owed by a defendant to a plaintiff, a breach of that duty, proximate causation between the conduct and the resulting injury, and the actual loss or damage." Selwyn v. Ward, 879 A.2d 882, 886 (R.I. 2005) (internal quotation omitted). Whether a duty exists is a question of law. See id. "If the evidence establishes that a duty did run from defendant to plaintiff, then plaintiff is entitled to a determination of the remaining factual questions-did defendant breach the duty of care, and if so, was that breach the proximate cause of plaintiff's harm?" Id. (citations omitted).
The Plaintiff does not address its remaining negligence claim in its memorandum of law. See P. Mem. 32. Further, the only party to touch on the issue of negligent trimming of the trees directly at trial was the Defendants. (Tr. at 260:18-22.) Thus, it is assumed that the Plaintiff's arguments regarding § 34-20-1 also apply to its negligence claim.
The Defendants rely on Mr. Lawrence's testimony to support their argument that KCP's employees were not negligent in trimming the trees. (D. Mem. 10.) The Defendants also cite to the common law right to trim encroaching branches and limbs, as stated in Rosa, supra. (D. Mem. 21.)
First, the Court finds that the Defendants' conduct cannot constitute negligence because the Defendants acted with intent to trim and cut the tops off the trees; the word "negligence" "denotes culpable carelessness" and intentional behavior cannot constitute negligence. See Black's Law Dictionary (11th ed. 2019); Tr. at 166:14-168:11; 301:21-25; 339:22-340:2; 349:7-10. Second, the Defendants had the right under Rosa, supra, to trim the vegetation both on Lots 74 and 75 that crossed the property boundary. Thus, because the Defendants acted intentionally and had the right to trim vegetation on both their own and Mr. Rossi's property, the Plaintiff's claim for negligence fails.
Black's Law Dictionary (11th ed. 2019) defines "negligence" as "[t]he failure to exercise the standard of care that a reasonably prudent person would have exercised in a similar situation; any conduct that falls below the legal standard established to protect others against unreasonable risk of harm, except for conduct that is intentionally, wantonly, or willfully disregardful of others' rights; the doing of what a reasonable and prudent person would not do under the particular circumstances, or the failure to do what such a person would do under the circumstances." (emphasis added).
C. Slander of Title
Finally, the Court must address the Defendants' counterclaim for slander of title. See Carrozza v. Voccola, 90 A.3d 142, 151 (R.I. 2014). "To prevail in a slander of title action, a plaintiff must prove by a preponderance of the evidence: (1) that the alleged wrongdoer uttered or published a false statement about the plaintiff's ownership of real estate; (2) that the uttering or publishing was malicious; and (3) that the plaintiff suffered a pecuniary loss as a result." Id. at 151-52 (brackets, citations, and quotations omitted). "The essential elements of slander of title must be proved merely by a preponderance of the evidence." Arnold Road Realty Associates, LLC v. Tiogue Fire District, 873 A.2d 119, 126 (R.I. 2005) (Arnold Road) (quotations omitted).
The Defendants argue that recording the Lis Pendens constituted malice that precluded Defendants from selling the developed lot, thus creating a pecuniary loss. See D. Mem. 31-32; 36; Lis Pendens.
In response, the Plaintiff argues that recording the Lis Pendens on Lot 74 did not constitute malice. See P. Mem. 26-32.
i. False statement
The first element of slander of title is that the defendant made a false statement about the claimant's property such as by recording a document in land records without reasonable or probable cause to have an interest in the plaintiff's property. See Louttit v. Alexander, 44 R.I. 257, 116 A. 882, 883 (1922) (holding that defendant made a false statement by filing a notice of intent to claim an easement because the defendant had lost interest in the property by adverse possession). But see Beauregard v. Gouin, 66 A.3d 489, 494-96 (R.I. 2013) (finding that the defendant did not make a false statement by filing a notice of intent to dispute potential adverse possession claims on defendant's property, rather than a claim regarding the plaintiff's property).
In Louttit, the Rhode Island Supreme Court held that the defendant made a false statement by filing a notice of intent to dispute ownership of an easement because the defendant's interest was extinguished by adverse possession. Louttit, 44 R.I. at 257, 116 A. at 883. The defendant's statutory claim to the easement expired years prior to when he filed his notice of intent. Id. The Court in Louttit reasoned that the defendant made a false statement by filing the notice of intent because the defendant's claim had expired, thus, he had no claim in the plaintiff's property. Id.
However, in Beauregard, 66 A.3d at 494-96, the Rhode Island Supreme Court held that the defendants, including a law firm, did not make a false statement by recording a notice of intent to dispute adverse possession on their clients' property, rather than the plaintiff's property. The defendants' notice of intent in Beauregard stated the following:
"Please take notice that the [defendants] hereby intend[] to dispute any right arising from [the plaintiff's] use of any part of the land which is of record owned by [the defendants.]" Id. at 495 (emphasis in original).
The Court in Beauregard reasoned that because the notice of intent was only intended to shield the defendants' property from adverse possession, rather than cloud the plaintiff's property, the notice of intent was not a false statement. Id. at 496.
Here, the Plaintiff recorded the Lis Pendens on Lot 74 when it had no claim prior to the lawsuit; Mr. Rossi also stated to several witnesses that the trees were on his property. See Tr. at 11:3-7; 14:15-17; 16:17-19; 16:23-17:1; 37:25-38:9; 84:10-15; Lis Pendens. Mr. DiOrio's initial survey, which he gave to the Plaintiff's family in April 2017, could have led an expert in the field of surveying to conclude that the trees were on Lot 74. (Tr. at 80:8-83:23.) After receiving the preliminary survey, the Plaintiff recorded the Lis Pendens in May 2017. See Lis Pendens; Tr. at 84:10-15. However, the Plaintiff received Mr. DiOrio's Final Survey in November 2018, which clearly demonstrates that the trees are on Lot 75, yet the Plaintiff did not release the Lis Pendens. See Final Survey; Lis Pendens; Tr. at 93:6-23; 98:3-14. The Final Survey demonstrated that the trees were deeper within Lot 75 than the preliminary survey. Id. at 98:3-14. Thus, the Lis Pendens was a lien on Lot 75 that clouded the Defendants' title and the Final Survey gave the Plaintiff notice that the trees were on Lot 75. Id. at 98:3-14; 291:11-292:3; 294:20-295:8; Final Survey.
The O'Malleys' realtor, Sandra Bliven, and attorney, Kirsten Stackpole, both credibly testified that the Lis Pendens prevented them from obtaining marketable title, and therefore, closing the sale was impossible. Id. at 143:9-14; 153:19-154:4. Attorney Stackpole's credible testimony indicated that the O'Malleys' closing on Lot 74 could not occur with the Lis Pendens present in land records. Id. at 153:19-154:9. The Lis Pendens was not removed, even after the Final Survey provided clear notice to the Plaintiff that the trees were located on Lot 75. See id.; Final Survey. In addition, Attorney Raheb credibly testified that the Lis Pendens precluded both potential and interested buyers from purchasing Lot 74 because, as a lien, the Lis Pendens clouded marketable title. Id. at 291:11-292:3; 294:12-295:8. Thus, on January 22, 2019, Attorney Stackpole sent a letter in which the O'Malleys sought a release from the purchase and sale agreement if KCP could not provide marketable title. Id. at 153:19-154:9; see Defs.' Trial Ex. B.
Similar to how the plaintiff in Louttit lacked any claim to the defendant's property, and dissimilar to how the defendants in Beauregard never claimed interest in the plaintiff's property, Mr. Rossi never had a claim on Lot 74 because he knew the trees were located on his property. The clear and credible trial testimony shows that Mr. Rossi planted the trees and the Final Survey reflected that the trees were on Lot 75. See Louttit, 44 R.I. at 257, 116 A. at 883; Beauregard, 66 A.3d at 494-96. Thus, the Defendants satisfied the first element of slander of title.
ii. Malice
Regarding the second element, "[t]he malice required for a slander of title claim is not malice in its worst sense * * * but rather an intent to deceive or injure; malice is established by a showing that a party made a false statement, with full knowledge of its falsity, for the purpose of injuring the complainant(s)." See Carrozza, 90 A.3d at 152 (brackets, citations, and quotations omitted). The Rhode Island Supreme Court has stated that '"whether * * * conduct amounts to malice is a question of fact."' Id. at 154 (quoting Arnold Road, 873 A.2d at 126). While "express malice need not be proved * * * and may properly be inferred from the language used or the character of the act committed," the "plaintiff must also show that the defendant could not honestly have believed in the existence of the right he claimed, or at least that he had no reasonable or probable cause of believing so." Id. at 152 (quotations omitted).
Rhode Island law is well developed regarding the malice element of slander of title. See id. at 148, 155-58 (finding that malice existed when the counterclaim defendant demonstrated "a clear indication that he had not filed suit 'to establish and recover property rightfully his, rather he filed suit to collect a debt'"); Montecalvo v. Mandarelli, 682 A.2d 918, 925 (R.I. 1996) (finding that malice existed when a counterclaim defendant "never had a good-faith belief in her claim to a shared ownership in the [subject] property despite her conviction that the [counterclaim plaintiffs] owed her money with respect to this and other properties"); DeLeo v. Anthony A. Nunes, Inc., 546 A.2d 1344, 1346-47 (R.I. 1988) (finding malice existed when the counterclaim defendant "physically interfered with construction of the parcel, called police to the development, complained to the press, objected to every step of the development process, and in fact specifically claimed that he had an interest in the triangular portion of the [counterclaim plaintiff's] parcel"); Hopkins v. Drowne, 21 R.I. 20, 41 A. 567, 568 (1898) (the progenitor of Rhode Island slander of title law; finding that malice "naturally and legitimately springs out of and is to be inferred from such language or conduct as naturally tends to deceive, injure, and damage another, and for which there is no legal excuse"). But see Arnold Road, 873 A.2d at 126-27 (finding no malice present when a fire department recorded a tax lien based on faulty tax assessment data).
Here, the Plaintiff filed the initial Complaint on May 23, 2017, just under a month and a half after Mr. DiOrio finished the preliminary survey, April 10, and two days before recording the Lis Pendens on Lot 74 on May 25. (Tr. at 84:10-18; 195:18-25.) Mr. DiOrio communicated the initial results of the survey, that more work would be necessary to find the actual boundary, but that the trees were likely on Lot 75, to members of the Rossi family in April 2017. Id. at 85:18-86:5. Mr. DiOrio also testified that members of the Rossi family may have informed him that the trees were on Lot 75. Id. at 90:20-91:24. As stated previously, however, while the preliminary survey could have led to the conclusion that the trees were possibly on Lot 74, the Final Survey established that the trees were on Lot 75, not Lot 74, giving the Plaintiff notice, yet the Plaintiff did not release the Lis Pendens. See Tr. at 80:8-83:23; 98:3-14.
Mr. Ward and Officer Mills also testified that they were informed by members of Mr. Rossi's family that the trees were on his property. Id. at 11:3-7; 14:15-17; 16:17-19; 16:23-17:1; 37:25-38:9. Ms. Spiers likewise testified that Mr. Rossi knew that he bought and planted the trees and wanted to do what he could to protect them. Id. at 169:1-8. Ms. Spiers later supported this testimony by stating that "[Mr. Rossi] mainly was concerned with protecting the trees, whether they were or were not on his property" and that he informed Officer Mills that he planted the trees "a long time ago and believed that those trees were on his property[.]" Id. at 170:1-4; 189:20-23.
Despite these indications that the trees were on Lot 75, the Plaintiff amended its complaint to add the adverse possession count ten months after recording the Lis Pendens. See Am. Compl. ¶¶ 38-43; see also Tr. at 78:3-9. When considering that a member of the Rossi family may have informed Mr. DiOrio that the trees were on Mr. Rossi's property; Mr. Rossi informed Officer Mills and Mr. Ward that the trees were on his property; Mr. Rossi would protect the trees whether the trees were on his property or not; and the Final Survey gave notice that the trees were on Lot 75, the Plaintiff recorded the Lis Pendens with the subjective intent to protect the trees, regardless of whether the trees were on his property, especially in light of the fact that the Plaintiff did not release the Lis Pendens after receiving the Final Survey. See Carrozza, 90 A.3d at 148 (plaintiff sued with the subjective belief that he was owed money and could use a lis pendens to collect the perceived debt); Montecalvo, 682 A.2d at 925 (plaintiff sued and used lis pendens to collect debts); DeLeo, 546 A.2d at 1346-47 (plaintiff sued with subjective intent to harass defendant and impede development of a parcel).
Like the facts of Carrozza, Montecalvo, and DeLeo, where the plaintiffs recorded lis pendens with the subjective intents to collect on debts or harass the defendants; here, the Plaintiff never had an interest in Lot 75 and knew or should have known that the trees were on its property- because Mr. Rossi bought and planted the Norway spruce trees himself and the Final Survey demonstrated the trees as being on Lot 75. See id.; see also Tr. at 169:1-8; 170:1-4; 189:20-23; Final Survey. Further, the evidence here is unlike the incorrect filing of the tax deed in Arnold Road, 873 A.3d at 127, where the fire department relied on faulty tax information from the town; here, Mr. Rossi bought and planted the trees and informed at least two witnesses that he owned the land on which the trees were planted, in addition to the Final Survey reflecting that the trees were on Lot 75. See Tr. at 16:17-19; 16:23-17:1; 90:20-91:24; 169:1-8; 170:1-4; 189:20-23; 299:13-300:8; 344:1-19.
Thus, for purposes of slander of title, the Plaintiff recorded the Lis Pendens with subjective and objective malice, knowing that Mr. Rossi planted the trees on his own land, with the intent to protect the trees, no matter the cost to Defendants, and not releasing the Lis Pendens after receiving the Final Survey, satisfying the second element.
iii. Damages
Regarding the third and final element of slander of title, "to prevail on a slander of title claim, a plaintiff must necessarily prove that he or she has sustained an 'actual pecuniary loss.'" Carrozza, 90 A.3d at 160 (quoting Peckham v. Hirschfeld, 570 A.2d 663, 666-67 (R.I. 1990)). "Unlike damages recoverable in most other causes of action, without proof that special damages (i.e., a pecuniary loss) were incurred, a prima facie case of slander of title will not be made." Id. (quotations omitted). "Consequently, in order for counterclaimants to prove their slander of title claim, they [are] required to show that they incurred an actual injury as a result of the filing of the notices of lis pendens." Id.
"Special damages 'are the actual, but not the necessary, result of the injury complained of.'" Peckham, 570 A.2d at 668 (quoting Black's Law Dictionary 354 (5th ed. 1979)).
In Carrozza, the Rhode Island Supreme Court held that the calculation for compensatory damages in slander of title claims is to subtract the subject property's value at the time when the notices of lis pendens were removed from the highest value of the property during the time that the lis pendens was in force. See id. at 149; see also Ashley B. Kocian, Carrozza v. Voccola, 90 A.3d 142 (R.I. 2014), 20 Roger Williams U. L. Rev. 710, 722 (2015) (commenting on Carrozza). The Court in Carrozza also held that there need not be a ready, willing, and able buyer present to establish damages in slander of title claims. See Carrozza, 90 A.3d at 162, 164.
Here, the Defendants lost two potential buyers because of the Lis Pendens, including the O'Malleys who entered into a purchase and sale agreement with KCP, in addition to their property to the lender via foreclosure. (Tr. at 290:23-24; 291:11-292:3; 295:9-18.) Attorneys Raheb and Stackpole testified that the two sales did not occur because of the Lis Pendens that created a cloud on Lot 74's marketable title. Id. at 143:9-14; 153:19-154:4; 291:11-292:3; 294:12-295:8. However, the Court notes that the Defendants did not submit any real estate appraisal testimony, from either a lay person or expert witness, unlike the counterclaimants in Carrozza. See Carrozza, 90 A.3d at 147-48. There was also no purchase and sale agreement present in Carrozza, unlike the purchase and sale agreement that the O'Malleys entered with KCP. Id. at 150 ("there was no evidence that the counterclaimants had a buyer for any of the properties or that any actual loss was incurred"); see Defs.' Trial Ex. A.
The O'Malleys contracted to purchase Lot 74 for $575,000. (Tr. at 308:14-18.) The evidence clearly establishes that there was an outstanding balance due to the Defendants' lender in the outstanding principal amount of $400,000 plus interest in the amount of $141,836.69 at the time of foreclosure. Id. at 293:9-14. The per diem interest rate was $197.26. Id. at 293:19-22. The Defendants also incurred carrying costs totaling $28,812 over twenty-eight months that they claim in damages. Id. at 309:23-313:25. These carrying costs, however, are not considered appropriate damages and will not be awarded. See id.; Defs.' Trial Exs. J; K; L; M; see also Peckham, 570 A.2d at 668 (finding that special damages consisted of fees to remove the cloud on the plaintiff's title and did not include unrelated costs such as obtaining title insurance); 103 Am. Jur. Trials 1 §§ 31-39 (2007) (damages for slander of title are typically limited to loss of property value; loss of trade, business, or rent; interest paid on loans when the property is unsaleable; expenses related to posting bonds; attorneys' fees and costs in relation to removing the cloud on the title; prejudgment interest; and exemplary or punitive damages).
Therefore, the Defendants are awarded the sum of $33,163.31 in damages plus pre-judgment interest under G.L. 1956 § 9-21-10 from the date the Lis Pendens was filed. See Carrozza, 90 A.3d at 164.
Minus value of property at foreclosure (removal of Lis Pendens): Highest value of property when Lis Pendens was in effect: $575,000.00
Principal remaining on loan: $400,000.00
Interest remaining on loan: $141,836.69$33,163.31 See Tr. at 293:9-22; 308:14-18; 309:23-313:25.
IV
Conclusion
For the reasons stated herein, the Court finds that Plaintiff satisfied its burden of proof regarding Count II under § 34-20-1 and is entitled to $84,570 in damages. However, the Plaintiff failed to prove Count III, negligence. The Court also finds that Defendants satisfied their burden of proof regarding their slander of title counterclaim and are entitled to $33,163.31 in damages plus pre-judgment interest under § 9-21-10. Counsel shall submit the appropriate judgment for entry.
The Defendants have also requested sanctions under Rule 11 of the Superior Court Rules of Civil Procedure and G.L. 1956 § 9-29-21, claiming the Plaintiff lacked a good faith basis to amend his complaint to add the adverse possession claim and for attorneys' fees, and pre-judgment interest under G.L. 1956 § 34-13.1-9. D. Mem. at 55-58. However, the Defendants requested these sanctions in their post-trial memorandum of law, not in their Answer or Amended Answer in a counterclaim; thus, the Court denies these requests. See Am. Answer.