Birchwood Land Company, Inc. v. Krizan
115 A.3d 1009
Vt.2015Background
- Krizan bought a landlocked lot in 1982 that lacked frontage, utilities, and was undevelopable absent access and infrastructure.
- Birchwood purchased surrounding parcels in 2002, obtained town approval to develop, and in 2007 extended Tanglewood Drive and installed water/sewer/electric lines that also connected to Krizan’s lot.
- After improvements, the town found Krizan’s lot developable and its assessed value rose substantially; Birchwood calculated Krizan’s share of improvement costs at about $50,100 (excluding a small connection fee).
- Birchwood sued, alleging unjust enrichment and seeking restitution and attachment of Krizan’s property; Krizan moved to dismiss for failure to state a claim.
- The trial court denied attachment and granted dismissal; the Supreme Court reviews de novo and assumes the complaint’s facts true for purposes of the motion to dismiss.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether unjust enrichment/liability in restitution lies for substantial but unrequested benefits conferred by Birchwood’s voluntary improvements | Birchwood: Krizan was unjustly enriched by the rise in property value and should pay a proportionate share (she’s a “free rider”) | Krizan: Improvements were voluntary, unrequested, and made for Birchwood’s own development; mere receipt of benefit does not create restitution liability | Held: No restitution. Restatement (Third) §30 governs unrequested benefits; such recovery is disfavored unless exceptions apply (mistake, compulsion, or other limited circumstances). Birchwood’s facts fit the Restatement illustration and Ranquist; dismissal affirmed |
| Whether an implied easement (access) obligates Krizan to share in improvement costs under unjust enrichment/servitude principles | Birchwood: As easement-holder/co-user, Krizan must contribute to costs of the access improvements | Krizan: Disputes easement existence and argues no duty to pay for voluntary improvements; even assuming an easement, improvements were not "necessary repairs" but voluntary improvements | Held: No recovery. Restatement §26 permits restitution only for necessary expenditures to protect property interests (repairs), not for nonessential improvements; Vermont law requires contribution for maintenance/repairs but not voluntary, nonnecessary improvements |
Key Cases Cited
- Lasek v. Vermont Vapor, Inc., 95 A.3d 447 (Vt. 2014) (discussed unjust enrichment for tenant-made improvements; Court noted lack of benefit proof was fatal there)
- Ranquist v. Donahue, 710 F. Supp. 1160 (N.D. Ill. 1989) (adjacent owner who refused to participate in improvements could not be held liable for costs when improvements were voluntary and not required until development)
- Storms v. Bergsieker, 835 P.2d 738 (Mont. 1992) (restitution required where co-easement holders made necessary repairs/replacement to shared bridge)
- Dinosaur Dev., Inc. v. White, 265 Cal. Rptr. 525 (Cal. Ct. App. 1989) (no restitution for off-site improvements benefitting neighboring parcel when work was for plaintiff’s own development)
- Wendover Road Property Owners Ass’n v. Kornicks, 502 N.E.2d 226 (Ohio Ct. App. 1985) (property owner required to pay only for "imperatively necessary" improvements; voluntary improvements provide no restitution remedy)