Hoffman v. Bob Law, Inc.
2016 SD 94
| S.D. | 2016Background
- Crestview Addition development: Bob Law, Inc. (Corporation) and Rick DeJager developed Lot 3; Corporation performed excavation/grade work and Lot 3 bordered unplatted Lot 4 (10-foot utility easement on Lot 3's west side).
- Construction errors: basement and several improvements (septic system, retaining wall, driveway, lamp pole, propane tank, concrete pad) were mistakenly located partly or wholly on Lot 4; southwest lot pin was lost and a transformer was mistakenly placed on Lot 4 and treated by parties as the property line.
- Chain of title and discovery: Corporation conveyed Lot 3 to DeJager, who later lost title; Kenneth Hoffman purchased Lot 3 in June 2011 without obtaining a survey and was later informed of the encroachments by Law.
- Procedural posture: Hoffman sued asserting an implied easement to keep the encroachments; Corporation counterclaimed for trespass and sought damages and a mandatory injunction to remove encroachments; two-day bench trial followed.
- Trial court findings: encroachments constituted trespass; denied Hoffman an implied easement; awarded only $1 nominal damages to Corporation; denied injunction to remove the septic system and allowed encroachments to remain unless relocated by Hoffman or successors; denied removal of other encroachments without separate equitable balancing.
- Appeal: Corporation appealed denial of injunction(s) and the judgment allowing encroachments to remain subject to future relocation. Court affirmed in part, reversed in part, and remanded for further balancing of equities on some encroachments.
Issues
| Issue | Plaintiff's Argument (Hoffman) | Defendant's Argument (Corp./Law) | Held |
|---|---|---|---|
| Whether Hoffman acquired an implied easement for encroachments | Hoffman argued prior use and necessity for septic/other items created an implied easement | Corporation argued no implied easement; unity of title severed and use was not sufficiently longstanding or obvious | Court denied implied easement (Hoffman does not appeal that denial) |
| Whether Corporation is entitled to a mandatory injunction to remove encroachments (statutory authorization) | Hoffman contended monetary relief might be adequate in some circumstances | Corporation argued pecuniary compensation is adequate; sought removal | Court held injunctions are authorized for encroachments because money often is inadequate for real property interests |
| Whether injunction to remove septic system should be granted (balancing equities) | Hoffman: removal would cause disproportionate hardship (high cost, practical impossibility, he did not cause encroachment) | Corporation: entitled to removal; landowner's property rights prevail and removal is proper remedy | Court held removal would cause disproportionate hardship to Hoffman; denied injunction for septic system; no abuse of discretion |
| Whether injunction should issue for remaining encroachments (lamp pole, pad, propane tank, wall, driveway) and whether nominal damages suffice while encroachments remain | Hoffman: equities favor allowing some encroachments to remain; nominal damages appropriate as Corp. failed to prove damages | Corporation: court lacked power to let encroachments remain while awarding only nominal damages; sought removal and actual damages | Court held trial court must balance equities for these separate encroachments; remanded to perform the relative-hardship balancing. Court also held permitting encroachments to remain with nominal damages can create an equitable (temporary) easement when removal would be inequitable and damages not proven |
Key Cases Cited
- Magner v. Brinkman, 883 N.W.2d 74 (2016) (standard of review for injunctions and legal questions reviewed de novo)
- Strong v. Atlas Hydraulics, Inc., 855 N.W.2d 133 (2014) (factors for weighing injunctive relief and review of factual findings)
- Graven v. Backus, 163 N.W.2d 320 (N.D. 1968) (mandatory injunction proper to compel removal of encroachment; courts balance equities)
- Beatty v. Smith, 84 N.W. 208 (1900) (monetary relief may be inadequate when land title is threatened)
- Zerr v. Heceta Lodge No. 111, 523 P.2d 1018 (Or. 1974) (awarding nominal damages where landowner fails to prove actual damages and permitting equitable easement)