Warren v. Derivaux


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Docket Number: 2007-CA-00905-SCT

Supreme Court: Opinion Link
Opinion Date: 12-04-2008
Opinion Author: Lamar, J.
Holding: ON DIRECT APPEAL: AFFIRMED. ON CROSS-APPEAL: REVERSED AND RENDERED

Additional Case Information: Topic: Real property - Perpetual easement - Lost profits - Punitive damages - Attorney’s fees
Judge(s) Concurring: Smith, C.J., Waller and Diaz, P.JJ., Easley, Carlson, Graves, Dickinson and Randolph, JJ.
Procedural History: Bench Trial
Nature of the Case: CIVIL - REAL PROPERTY

Trial Court: Date of Trial Judgment: 05-02-2007
Appealed from: Hinds County Chancery Court
Judge: Denise Owens
Disposition: The chancellor ruled that Derivaux had a valid and enforceable easement for parking and signage, and was awarded damages for lost profits. The Chancellor also reversed a county court's award of punitive damages and attorneys' fees for Derivaux.
Case Number: G2006-2112

  Party Name: Attorney Name:   Brief(s) Available:
Appellant: W.W. Warren




Roy H. Liddell; Clint D. Vanderver; Beverly D. Poole



 
  • Appellant #1 Brief
  • Appellant #1 Reply Brief

  • Appellee: Robert Derivaux Stephen J. Carmody; Jonathan R. Werne  

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    Topic: Real property - Perpetual easement - Lost profits - Punitive damages - Attorney’s fees

    Summary of the Facts: W. W. Warren and Robert Derivaux own adjoining commercial property. Warren’s property is to the immediate north of Derivaux’s property. In 1986, the Mississippi Department of Transportation updated the frontage road that runs along the east property line of both parties. Because Warren’s property lost all access to the frontage road from his property, Warren negotiated for an access easement across the property of Ronald Smith, predecessor owner of Robert Derivaux’s property. In return, Smith sought rights as to parking and signage. Warren and Smith executed a document entitled “Reciprocal Easement.” Pursuant to its terms, Smith erected a business sign within 1.5 feet of his north property line and 33 feet from the southeast corner of Warren’s property. The sign stood until 1988, when Derivaux purchased Smith’s property in foreclosure. Having been informed of the Reciprocal Easement, Derivaux removed Smith’s sign and erected a new sign for his insurance business. Warren and Derivaux discussed the new sign with Warren approving. From 1988 until April 2002, Derivaux, his employees, and his customers used four parking spaces located on the Warren property. In 1998, Warren informed Derivaux that the sign could not remain in its location unless Derivaux paid rent. No further action was taken by either party until April 2002, when Warren demanded monthly payment for parking. Derivaux made one payment in the amount of $250, but ceased payments after consulting his attorney. Derivaux continued to use the four parking spaces. In 2005, Warren disconnected the power to Derivaux’s sign. Derivaux gave Warren a copy of the Easement and demanded that Warren cease tampering with the sign. Warren, his son, and a welder removed Derivaux’s sign by the use of a blow torch and damaged the sign in the process. Warren also placed concrete parking bumpers in the parking lot, restricting Derivaux’s access to the spaces nearest the property line. Derivaux filed suit against Warren seeking compensatory and punitive damages, along with injunctive relief. The county court issued a temporary restraining order ordering Warren to remove the parking bumpers. In response, Warren rearranged the barriers and installed a wooden fence near the property line. The county court held that the Reciprocal Easement granted Derivaux and his successors the right to use four parking spaces for business purposes without restriction as well as the right to erect and maintain a sign within the designated area. The court further found that Warren’s actions were malicious and/or grossly negligent, warranting an award of punitive damages. The county court awarded punitive damages and attorneys’ fees, in addition to compensatory damages for the cost of a new sign and for loss of profits. The county court also granted Derivaux and his successors a permanent injunction preventing any interference with their rights under the Reciprocal Easement. Warren appealed the ruling to chancery court which affirmed the county court’s ruling as to the easement and damages for lost profits, but reversed the award of punitive damages and attorneys’ fees. Warren appeals, and Derivaux cross-appeals.

    Summary of Opinion Analysis: Issue 1: Perpetual easement Warren argues that the trial court erred in finding that the Reciprocal Easement created a perpetual easement as to parking and signage. The Reciprocal Easement states that Smith and Warren “do hereby sell, convey, and vest in each other, their successors in title, perpetual easement rights . . . . ” A semi-colon follows this statement, followed by one paragraph for each of the access easement, the cross-parking, and the business sign. It would follow to an intelligent layman that the “perpetual easement rights” would apply to each paragraph thereafter, noting especially that no qualification is made that the parking and signage provisions are not, in fact, easements. The facts indicate that both parties believed that parking and signage were part of the perpetual easement until Warren changed his mind in 1998. Warren also argues that the Reciprocal Easement lacks the specific description required for a valid easement. Any description of an easement needs accuracy and clarity. The Reciprocal Easement specifically describes the access easement, with reference to an attached plat map. The Reciprocal Easement’s description of both the access and signage areas certainly is sufficient to establish an easement, as it provides accuracy and clarity as to the location. The Reciprocal Easement’s description of the parking spaces does not on its face provide accuracy and clarity. Any ambiguity, however, should be construed against the drafting party. It is undisputed that Warren’s attorney drafted the Reciprocal Easement. Because Warren, as the drafting party, did not designate the location of the easement, Smith and Derivaux were free to select a suitable location, taking into account the interest of Warren. Any objection by Warren to the parking spaces selected by Smith and Derivaux should have been made within a reasonable time. Because Warren did not object, the location of the four spaces was determined by the “exercise of the right” by Derivaux, with Warren’s acquiescence. Issue 2: Lost profits Warren argues that the chancery court erred in affirming an award of lost-profits damages to Derivaux, because no evidence in the record demonstrates that Warren’s removal of the sign was causally related to Derivaux’s lost income. A party seeking recovery for lost profits must establish the claim with reasonable certainty, not based on mere speculation and conjecture. Damages are deemed speculative only when the cause is uncertain, not when the amount is uncertain. Damages may be awarded if the evidence lays a foundation which will enable the trier of fact to make a fair and reasonable estimate of the amount of damage. Because documentation of the calculation and the testimony of Derivaux himself were presented at trial, the court was presented with ample evidence upon which to estimate lost profits to a reasonable certainty. Issue 3: Punitive damages Derivaux argues that the chancery court’s reversal of punitive damages was error. Section 11-1-65(1)(a) allows for punitive damages where a plaintiff shows by clear and convincing evidence that the defendant acted with actual malice, gross negligence which evidences a willful, wanton or reckless disregard for the safety of others, or committed actual fraud. Courts have applied the same rules to easement grants as to contracts. Punitive damages are recoverable in breach of contract cases where the breach results from an intentional wrong and when there has been a showing of malice or gross/reckless disregard for the rights of others. Given the facts presented in this case, the chancery court erred in reversing the award of punitive damages. In addition, attorneys’ fees are proper in this case, as punitive damages were properly awarded by the county court.


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