Hoffman v. Bob Law, Inc.

888 N.W.2d 569 (2016)

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Nature of the Case

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Facts

D is an excavation and land development company that owned a real estate development. D entered into an agreement with Rick DeJager to jointly develop Crestview. DeJager was the general contractor responsible for the construction and sale of the homes and lots. The development was surveyed, and seven pins were placed to mark the boundaries of Lot 3. The pin marking the southwest corner of the lot was subsequently lost. Lot 3 is burdened by a ten-foot utility easement on the west side. D owns the unplatted lot west of Lot 3, which is referred to by the parties as Lot 4. Construction on Lot 3 began when D still owned the lot. D excavated the basement for a house and it graded a dirt driveway. D placed the basement twenty feet west of its planned location. D directed an electrical contractor to place a transformer on the property line between Lots 3 and 4. However, the transformer was mistakenly placed on Lot 4, outside of the utility easement, fourteen feet west of the property line. D and DeJager continued building under the mistaken belief that the transformer marked the property line. D roughed in a water line. A septic system was also installed. D conveyed Lot 3 to DeJager and his wife and DeJager installed a concrete retaining wall, concrete pad, and lamp pole. He also poured concrete for the driveway that had been graded by D. Parts or all of these improvements were mistakenly located on Lot 4 instead of Lot 3. DeJager and his wife lived in the home until 2009 or 2010 when they defaulted on their loan and declared bankruptcy. Lot 3 was subsequently conveyed to the bank that held the mortgage. P entered into an agreement to purchase Lot 3 from the bank. P could have had the lot surveyed at no expense. P was in a hurry and decided to forego a survey. The day after closing, [D contacted P and informed him that there was an encroachment on Lot 4. D proposed to move the septic system's leach field for $150,000 and sell P an easement for the septic tank for $25,000. When P did not immediately accept this proposal, D threatened to dig out the septic system. P obtained a temporary restraining order (and later a preliminary injunction) prohibiting D from removing the septic system. P claimed that he had acquired an implied easement on Lot 4 for the encroachments. D counterclaimed for trespassing. D sought money damages (rental value and diminution in value of the lot) as well as a mandatory injunction to remove the encroachments. The septic tank, propane tank, concrete pad for the propane tank, lamp pole, and portions of the concrete retaining wall and driveway encroached on a small portion of Lot 4. The circuit court found that the septic system was installed by D before the lot was conveyed to DeJager and that DeJager installed the other encroachments. The court denied P an implied easement. It then ruled that the encroachments constituted a trespass. Because D failed to present evidence of damages, the court awarded $1 in nominal damages. It denied D's request for an injunction. D had an adequate remedy at law (damages); the encroachments were on a small sliver of land that could not be used due to the utility easement; P did not install the encroaching items; and the cost to remove the encroachments would be disproportionate to any benefit to be gained. The court ordered that the encroachments would not be subject to a current or future court order of removal; but if the encroachments were subject to relocation by P or his successors in interest, they would have to be removed from Lot 4 and relocated on Lot 3. D appealed.