Summary
The Alabama Supreme Court considered whether an agreement granting a golf club use of part of adjoining property created a revocable license or an easement. The court affirmed the determination that the agreement created an easement, affirmed summary judgments on most fraud, suppression, and conspiracy claims as time-barred, and reversed summary judgment on the buyers’ breach-of-warranty-deed and indemnity claims. The case arose from the sellers’ failure to disclose the recorded golf-course use agreement to the purchasers.
Topics
Practice areas
Questions Presented
- Whether the agreement between the Casseses and Greystone Golf Club created a revocable license or an easement running with the land.
- Whether the Boyces' fraud, suppression, conspiracy, negligence, and wantonness claims were barred by the applicable two-year statutes of limitations in light of the recorded agreement and constructive notice.
- Whether the Casseses' warranty deed created a genuine issue of material fact concerning breach of covenants against encumbrances and for quiet enjoyment.
- Whether the Golf Club's authorized entry under the easement defeated the Boyces' trespass claim and whether the nuisance claim could be resolved on the record presented.
- Whether Stewart Title breached its title-insurance policy by failing to disclose or except from coverage a recorded encumbrance, and whether Birmingham Title was liable as the issuing agent.
Holdings
- The agreement, as amended, created an easement rather than a revocable license.
- Because the agreement and amendment were recorded before the Boyces acquired title, the Boyces were charged with constructive notice of the encumbrance as of the date they obtained title.
- The Boyces' fraud, suppression, conspiracy, negligence, and wantonness claims were time-barred because they were filed more than two years after the Boyces were charged with constructive notice of the recorded agreement.
- Summary judgment for the Casseses on the Boyces' breach-of-warranty-deed and indemnity claims was improper because the deed contained covenants against encumbrances and for quiet enjoyment, and the undisclosed easement created a genuine issue of material fact.
- The trespass claim failed as a matter of law because the Golf Club had a recorded easement authorizing its entry, but the nuisance claim was not necessarily barred by that easement; the court did not address the nuisance issue because the Boyces failed to argue it adequately on appeal.
- Summary judgment for Stewart Title on the breach-of-title-policy claim was improper because the Boyces presented substantial evidence that the policy insured against title defects and failed to disclose or except a recorded encumbrance; indemnity would be available if the Boyces proved resulting loss or damage.
- Summary judgment for Birmingham Title on the breach-of-title-policy claim was proper because the Boyces did not establish that Birmingham Title issued the policy in its own name or intended to bind itself to the insurance contract.
Key quotations
“The critical factor is the parties' intent.” (941 So. 2d at 941-42)
“If a party enters property or possesses property under a legal right, entry or possession pursuant to that right cannot constitute a trespass.” (941 So. 2d at 945)
“If the Boyces establish that they have been damaged as a result of this undisclosed recorded encumbrance, they are entitled to indemnity by the title insurer.” (941 So. 2d at 949)
Factual background
The Casseses owned a lot adjoining the 18th hole of Greystone Golf Club and entered into a 1994 written agreement allowing the club to use part of the property for golf and tournament activities. A 1996 amendment extended the tournament-use rights, and the agreement and amendment were recorded four days before the Boyces acquired the property, although the sales contract, deed, and title commitment did not disclose them. After purchasing the property, the Boyces observed the Golf Club using the property for tournament-related activities and later sued the Casseses, Golf Club, and title companies.
Procedural history
The Boyces purchased the property from the Casseses in January 1997. The trial court determined that the agreement between the Casseses and Greystone Golf Club created an easement and entered summary judgments for the defendants on all claims. The Alabama Supreme Court affirmed the easement determination and most summary judgments, but reversed the judgment for the Casseses on the warranty-deed and indemnity claims and reversed the judgment for Stewart Title on the breach-of-title-policy claim.
Remand instructions
Proceed against Stewart Title on the breach-of-title-policy claim and against the Casseses on the breach-of-warranty-deed and indemnity claims, consistent with the opinion.