2010-812 Alfred R. Marshall, Jr. & a. v. James J. Burke, Jr. & a.

No. 2010-812

Carroll

Orr & Reno, P.A.

Cooper, Cargill & Chant, P.A. and Beverly Ann Jensen, Joan C. Picard, and the Deer Cove Shorefront Owners Association. The defendants are James J. Burke and Patricia M. Burke, Thomas E. Williams, G. Thomas Jensen 1

defendants on the plaintiffs’ claim to a prescriptive easement over defendants’ 1 , J.) granting summary judgment in favor of the

for the defendants.

brief and orally) for the plaintiffs.

page is: http://www.courts.state.nh.us/supreme. a.m. on the morning of their release. The direct address of the court's home reporter@courts.state.nh.us. Opinions are available on the Internet by 9:00 to press. Errors may be reported by E-mail at the following address: editorial errors in order that corrections may be made before the opinion goes Hampshire, One Charles Doe Drive, Concord, New Hampshire 03301, of any Readers are requested to notify the Reporter, Supreme Court of New well as formal revision before publication in the New Hampshire Reports. NOTICE: This opinion is subject to motions for rehearing under Rule 22 as in the light most favorable to the non-moving party. Big League Entm’t v. Brox p. 2 the affidavits and other evidence, and all inferences properly drawn from them, In reviewing the trial court’s grant of summary judgment, we consider

ripened prescriptive rights as a matter of law. This appeal followed. court held that even assuming such easement existed, the tax deed cut off even deciding whether the plaintiffs actually had an easement prior to 1987, the on this point and therefore did not address their other arguments. Without property by tax deed in that year. The trial court agreed with the defendants have existed prior to 1987, was extinguished by the Town’s acquisition of the one being that any prescriptive easement to use the Beach Lot, which may over that lot. The defendants challenged the plaintiffs’ claim on five grounds,

Beach Lot to access Lake Ossipee, thus giving them a prescriptive easement than twenty years of open, adverse, continuous and uninterrupted use of the the Beach Lot by tax deed in 1987, they and their predecessors had made more the Beach Lot. The plaintiffs claimed that, prior to the Town’s acquisition of determination that they hold prescriptive rights to use Blanchard Road and 2 In June 2010, the plaintiffs filed this action seeking a court

Beach Lot that is located across Deer Cove Road from his or her lot. 1998, DCSOA conveyed to each of the individual defendants that portion of the the Beach Lot to the Deer Cove Shorefront Owners’ Association (DCSOA). In Banfill by quitclaim deed dated September 1, 1993. Banfill in turn conveyed dated December 13, 1987. The Town conveyed the Beach Lot to Florence Town of Ossipee (Town) acquired title to the Beach Lot by a tax collector’s deed Hampshire, which conveyed the Beach Lot to Charles Banfill in 1955. The the Beach Lot ultimately passed through Lord’s heirs to the University of New sell parcels from his land, including several non-waterfront back lots. Title to the Beach Lot) during his lifetime. After Lord’s death, his heirs continued to acquired by Francis H. Lord in 1871. Lord sold several beachfront lots (but not The plaintiffs’ and the defendants’ lots were originally part of a parcel

Blanchard Road easement and therefore it is not before this court in the instant appeal. Road as well as the Beach Lot, the trial court’s summary judgment order did not address the alleged plaintiffs’ means of access to the Beach Lot. Although plaintiffs’ suit claimed an easement to use Blanchard Blanchard Road runs from Benson Road to Deer Cove Road over the Burke lot (Lot 68) and provides 2

the west of Benson Road is the plaintiffs’ property. defendants. To the west of the lots of these defendants is Benson Road, and to Cove Road. To the west of Deer Cove Road are the properties of the individual Beach Lot is located to the west of Lake Ossipee between the lake and Deer The summary judgment record reveals the following pertinent facts. The

remand. beach front property (the “Beach Lot”) on Lake Ossipee. We reverse and p. 3 3

1 p. 3 38 N.H. 561, 571-72 (1994). twenty years of adverse, continuous and uninterrupted use of the land. See, e.g., Flanagan v. Prudhomme, To establish an easement by prescription, the claimant must prove, by a preponderance of the evidence, 3 that Gowen ha[d] been overruled sub silencio. . . .” As additional support for The trial court recognized that Burke that “Burke is wholly inconsistent with Gowen” and “conclude[d], therefore, Estates or Different Interests, 75 A.L.R. 416, 417 (1931)), the trial court found Acquired by Purchaser at Tax sale of Property Which is Subject to Successive the sale,’” Burke, 159 N.H. at 512-13 (quoting Annotation, Quantum of Estate simple absolute, . . . free from all equities and encumbrances existing prior to conveyed by a [tax sale] is . . . a new and paramount title to the land in fee However, relying on language we quoted from an ALR Annotation that “‘the title property that had existed for at least thirty-five years prior to the tax sale. N.H. 383 (1939), we held that a tax sale did not divest an easement over before the tax sale. The court also acknowledged that in Gowen v. Swain, 90 in that it did not involve a claim to a ripened prescriptive easement that existed

to a tax sale.” Burke, 159 N.H. at 512. foreclosure proceedings extinguishes the prescriptive period accumulated prior had the latter effect, holding that “a municipality’s title to land through tax (1989), or whether it started that period running anew. We concluded that it possession period, as we had held in Kellison v. McIsaac, 1 p. 3 31 N.H. 675, 681 In Burke ownership; that is, whether it merely interrupted the running of the adverse Town was excluded, we were then required to decide the effect of the Town’s twenty years, even if the time during which the Beach Lot was owned by the See RSA 80:39 (2003). Because the Pierros’ total claimed adverse use exceeded because it was asserted more than ten years after the tax deed was recorded. Id that our decision in Burke v. Pierro. at 512. We held that the Pierros’ challenge to the tax sale was untimely irrelevant to their asserted twenty years of uninterrupted beach usage . . . .” On appeal, the plaintiffs argue that the trial court erred in determining the lot. Instead, they argued that the tax deed was invalid and therefore “was 3 use of the Beach Lot for twenty years before the date the Town acquired title to Unlike the plaintiffs here, the Pierros did not claim that they had made adverse back lot owners (the Pierros) to the same Beach Lot involved in this case. , we considered a prescriptive easement claim made by different

the trial court properly construed Burke. We agree with the plaintiffs. deed was extinguished by that deed. The defendants dispute this, arguing that conclusion that any easement the plaintiffs might have had prior to the tax

review the trial court’s application of the law to the facts de novo. Id. as a matter of law, we will affirm the grant of summary judgment. Id. We genuine issue of material fact, and if the moving party is entitled to judgment Indus., 1 p. 4 49 N.H. 480, 482 (200 p. 3 3). If our review of that evidence discloses no 4

Buchholz could not stand. that extinguishes all interests aside from the fee ownership of the tax sale purchaser, then our decision in on the other. If by “in rem proceeding” defendants mean a proceeding that results in issuance of a tax deed Waterville Estates Assoc., 156 N.H.172 (2007), that a tax sale does not extinguish condominium covenants, regarded as a purely in rem proceeding, on the one hand, and its support of the holding in Buchholz v. We observe that there is a similar tension between defendants’ argument that a tax sale should be p. 4 4

prescriptive rights accruing prior to the tax sale, and quite another to hold, as possession has ripened.” We do not retreat from the view that tax sales are in did in Burke, that a tax sale extinguishes budding but as yet unripened period would ripen into a prescriptive easement. It is one thing to rule, as we possibility that continued adverse use for the remainder of the limitations cases is that Gowen dealt with a vested right, while Burke involved the mere fundamentally at odds. The important distinguishing feature between the as creating a “new and paramount title,” the two decisions are not p. 4 4 between Gowen’s holding and certain language in Burke describing a tax deed from the designation. And while we acknowledge the existence of some tension them this designation does not answer the question of what consequences flow recovery from the property itself rather than from its owners, but assigning rem proceedings in the sense that collection of the taxes due is limited to

transfers only the title held by the person assessed when an adverse adverse possession has not ripened, and an in personam proceeding that tax sale should be an in rem proceeding that creates a virgin title when an and brackets omitted)). The defendants argue that “[t]here is no reason why a leaving to this Court the prerogative of overruling its own decisions.” (quotation of decisions, the [lower courts] should follow the case which directly controls, Our opinion in Burke application in a case, yet appears to rest on reasons rejected in some other line Felton, 521 U.S. 203, 237 (1997) (“If a precedent of this Court has direct implicit or assumed in the decision but is not announced”); see also Agostini v. (“a case is not binding precedent on a point of law where the holding is only point now at issue was not fully debated”); 20 Am Jur 2d, Courts § 13 p. 4 4 (2005) Stevens, J.) (“we are not bound to follow our dicta in a prior case in which the settled principles of stare decisis. See id. at 363 (opinion for the Court by reached except on inescapable grounds, as to do otherwise is inconsistent with U.S. 356, 382 (2006) (Thomas, J., dissenting), such a conclusion should not be overruled sub silencio, see Central Virginia Community College v. Katz, 546 while, like the trial court, we acknowledge the reality that a case may be did not cite or reference Gowen in any way, and

have ripened into vested property rights prior to recording of the tax deed. Gowen and that a tax sale does not extinguish prescriptive easements that possession. See Burke, 1 p. 5 59 N.H. at 51 p. 4 4. We hold that Burke did not overrule held that a tax deed extinguished even a ripened claim of title by adverse Everett, 308 P.2d 216 (1957), a case in which the Colorado Supreme Court of the effect of a tax sale, Burke cited approvingly the decision in Harrison v. this conclusion, the trial court noted that in adopting the majority in rem view 5

issues either and leave them for the trial court on remand. court did not reach any of these issues and the defendants did not cross-appeal, we do not address these proceedings “should have rendered the Appellees’ titles to the Beach Lot unassailable.” Because the trial (including the Burke case) involving the Beach Lot, did not join those proceedings, and that the result of those In their brief, the defendants assert that the plaintiffs knew or should have known of prior proceedings p. 5 5 We recognize that, in addition to Harrison

Congregation Yetev Lev D’Satmar, Inc. v. County of Sullivan, 4 p. 5 52 N.E.2d 1207, 2001); Overstreet v. City of Raleigh, 330 S.E.2d 643, 645 (N.C. Ct. App. 1985); 1007, 1011-12 (Ill. App. Ct. 2002); Lippert v. Jung, 783 A.2d 206, 219 (Md. here, a claim to an appurtenant easement. See Killon v. Meeks, 777 N.E.2d involved claims of a fee interest acquired by adverse possession rather than, as prescriptive rights. However, most of these cases, including Harrison itself, sales extinguish not just accruing prescriptive claims but also ripened facilitating the marketability of tax titles as the basis for holding that such which have adopted the in rem view of tax sales have relied on the rationale of , a number of other courts

dictates overruling Gowen (2003) (taxpayer bears the burden of proof in abatement proceedings). Regarding the first factor, the defendants argue that sound public policy assessed” (emphasis added)); Porter v. Town of Sanbornton, 1 p. 5 50 N.H. 363, 367 2010) (“[s]electmen or assessors, for good cause shown, may abate any tax abatement process. See The defendants next argue Gowen, 90 N.H. at 387; see that, even if Burke also RSA 76:16, I (Supp. 5 insuring that this occurs is placed on the property owner through the tax on the value of properties, the practical reality is that the actual burden of and while assessors are presumed to take account of the impact of easements properties sold for taxes are sold subject to ripened prescriptive easements, is that any such burden is more theoretical than real because, under Gowen, judgment and recorded in the land records. The short answer to this argument ascertain the existence of prescriptive easements that have not been reduced to because it is impractical for tax assessors to

N.H. at 731. We disagree that these factors warrant overruling Gowen. have robbed the old rule of significant application or justification. Kalil, 1 p. 5 59 doctrine; and (4) facts have so changed, or come to be seen so differently, as to developed as to have left the old rule no more than a remnant of abandoned the consequences of overruling; (3) related principles of law have so far (2) the rule is subject to a kind of reliance that would lend special hardship to (1) the rule has proven to be intolerable simply in defying practical workability; factors weigh in favor of overruling Gowen. The factors in question are whether: determining whether to overrule precedent, the defendants argue that these v. Town of Dummer Zoning Board of Adjustment, 159 N.H. 725 (2010), for Gowen, we should now do so explicitly. Relying on the factors we cited in Kalil

already exist at the time the tax sale occurs. we refused to do in Gowen, that a tax sale extinguishes prescriptive rights that p. 6 6

law’s long history of recognizing unrecorded prescriptive easements as a valid easements, extending protection from tax sales only to the former, given our possible to distinguish between recorded and unrecorded appurtenant Affected by Sale for Taxes, 1 p. 6 68 A.L.R. 529 (1947). And while it might be 187 (1992); Annotation, Easement or Servitude or Restrictive Covenant as Easement, Servitude, or Covenant as Affected by Sale for Taxes, 7 A.L.R. 5 th servitudes.”); accord Buchholz, 156 N.H. at 175; see also Annotation, concluded that tax-foreclosure sales do not result in extinguishment of some (2000) (“The majority of courts that have considered the question have (quotation omitted)); Restatement (Third) of Property (Servitudes) extinguishes the interest. See § 7.9, at 391 constitute a taking or deprivation of property without due process of law, see easement, or, to express it another way, the lot less the easement should pass.” unfairness in holding that a sale of the property by the taxing authority paid on the dominant estate, it is at least unfair – and arguably would ought not to pass to the purchaser; the lot should pass subject to the paid the taxes due on the property, depending upon the facts, there may be no value to the servient estate (here the Beach Lot). Where the taxes have been that, when the servient lot is sold for taxes not paid upon it, the easement entitlement to the benefit of that value through adverse possession has not dominant estate), and, conversely, the easement is regarded as diminishing the is really part of the latter. It is carved out of the former. So it would appear taxation – is reflected in the property itself. Accordingly, where one claiming deemed to be reflected in the property that is benefitted by the easement (the 1954) (“An easement which lies upon one lot but is appurtenant to another lot interest, the value of that interest to the holder – and the value subject to appurtenant prescriptive easement, however, the value of that interest is an appurtenant easement. See fee interest and a claim to an appurtenant easement. In the case of a fee Alvin v Johnson, 63 N.W.2d 22, 26 (Minn. regularly and that a default may result in forfeiture of the land”). With an rationale which supports the majority view that a tax sale does not extinguish In the tax sale context, there is a crucial distinction between a claim to a chargeable with knowledge that taxes will be levied against the property reasoning we adopted in Gowen, see Gowen, 90 N.H. at 387-88, but also is the the (reduced) value of the servient property. This is not only the precise estate to extinguish the easement simply because the taxes were not paid on Hayes v. Gibbs, 169 P.2d 781, 786 (Utah 1946) – to the owner of the dominant

owners [including those claiming ownership by adverse possession] are N.E.2d at 1211 (“[s]tatutes taxing real property are universal and property

extinguished recorded restrictive covenant). Des Moines, 2 p. 6 68 N.W. 36, 3 p. 7 7-38 (Iowa 1936) (holding that tax sale sale extinguishes even recorded appurtenant easement); Nedderman v. City of But see Wolfson v. Heins, 6 So.2d 858, 860-61 (Fla. 1942) (holding that tax 1212-13 (N.Y. 1983); Leciejewski v. Sedlak, 342 N.W.2d 734, 739 (Wisc. 1984). 7

easements]”). taxes paid, in order to protect their property from the loss of [appurtenant position of seeing that . . . their . . . neighbors are properly assessed and their unreasonable burdens upon landowners by putting them in the precarious follow such a theory would create a great insecurity of titles by placing process required that easements be extinguished by tax sale because “[t]o See Hayes, 169 P.2d at p. 7 788 (rejecting argument that efficiency of tax collection hardship for those unable to or unaware of the need to adjust to such change. behavior of property owners and would create the potential for widespread only prospectively, the result would still require fundamental change in the now face unmarketable and clouded titles”). But even if Gowen were overruled previously had believed their titles to be marketable and unencumbered, [but] would result . . . [to p]roperty owners, whose titles contain a tax deed and who that would be adversely affected by overruling Gowen not foreshadowed clearly by any cases which came before it,” and “inequities The defendants next argue that there are no significant reliance interests N.H. 1 (1988) retroactively where it “upset customary tax sale practices,” “was N.H. 645, 651 (1989) (declining to apply decision in White v. Wolfeboro, 131 do so would extinguish plaintiffs’ vested rights); Opinion of the Justices, 131 Court decision that effectively overruled prior precedent retroactively where to (holding that due process would be violated by applying a Tennessee Supreme McCullough, 2008 WL 4767060, at *10-14 (Tenn. Ct. App. Oct. 29, 2008) – a prospect that would raise obvious constitutional concerns. Cf. Crespon v. protection offered by that case would find themselves deprived of their property retroactively, there would be a real risk that some owners who relied on the their properties benefit. If a decision overruling Gowen were applied adjoining or neighborhood properties burdened by the easements from which owners have felt no particular need to pay attention to the tax status of taxes. Based on this holding, it is reasonable to assume that such property appurtenant do not lose this property right when the servient estate is sold for seventy years that property owners holding a ripened prescriptive easement Under the holding of Gowen, it has been the law of this state for more than settled expectations of property rights under existing New Hampshire law. such as those at issue in Buchholz, even such a narrow decision would upset cast no doubt on the validity of recorded easements or restrictive covenants easements, such as the prescriptive easement at issue here, the decision would While it is true that if we limited such a ruling strictly to unrecorded . Again, we disagree.

easement by implication). p. 7 715 (Ohio Com. Pl. 1955) (holding that tax sale did not extinguish pre-existing prescription.” Alvin, 63 N.W.2d at 28; see also Helle v. Markotan, 137 N.E.2d equally weighty and pertinent when considering the survival of an easement by arguments which support survival of a recorded easement from a tax deed are property right, we agree with the Minnesota Supreme Court that “the p. 8 Reversed and remanded

remanded for further proceedings consistent with this opinion. DALIANIS, C.J., and DUGGAN, HICKS and CONBOY, JJ., concurred. summary judgment in favor of the defendants is reversed and the case is

For the reasons stated above, the superior court’s order granting Finally, the defendants attempt to distinguish Gowen

proceeding. Gowen, 90 N.H. at 387. that if this assumption was incorrect, the remedy lay in an abatement presumed that tax assessors take account of easements, and then observed role in the court’s decision. Rather, as noted previously, the court simply in the opinion that the open and obvious character of the easement played any recited in Gowen, the problem with this argument is that there is no indication not. Although the defendants have accurately described the easement as at either end of the property), whereas the easement claimed by the plaintiffs is by wheel tracks leading over the servient property and gaps in the stone walls that the prescriptive easement in Gowen was “open and obvious” (as evidenced

today’s decision. constitutional limitations, it retains the ability to do so if it disagrees with would long ago have taken action to remedy the situation, and, subject to Gowen were a significant problem in this regard, we expect the legislature New Hampshire municipalities in the collection of property taxes. Indeed, if prescriptive easements following a tax sale has proved to be an impediment to seventy plus years Gowen has been the law, the survivability of ripened tax titles, we have been made aware of no information suggesting that, in the cognizant of the strong public interest in insuring the ready marketability of revisiting the holding of that case. More importantly, while we are fully regarding property taxation since Gowen was decided that would warrant our attention any substantive changes in the New Hampshire statutory scheme that, with respect to statutory law, the defendants have not brought to our make tax titles less contestable.” In response to this argument, we note first challenge, and [that] the modern trend in both statutory and case law is to when tax titles in American jurisdictions were generally more vulnerable to warrant overruling Gowen. Specifically, they argue that Gowen “reflects an era The defendants contend that the third and fourth Kalil factors also