FOR PUBLICATION
ATTORNEYS FOR APPELLANT: ATTORNEYS FOR APPELLEE:
C. DUANE ONEAL JAN M. CARROLL
TODD A. RICHARDSON MICHELLE L. BLANK
Lewis & Kappes Barnes & Thornburg
Indianapolis, Indiana Indianapolis, Indiana
S & S ENTERPRISES, )
)
Appellant-Plaintiff, )
)
vs. ) No. 49A02-0212-CV-1033
)
MARATHON ASHLAND PETROLEUM, LLC, )
)
Appellee-Defendant. )
OPINION - FOR PUBLICATION
Paragraph 1 is deleted and the following is inserted in lieu thereof:
1. [Marathon Oil Company] shall have a non-exclusive twenty-five (25) foot wide easement running
from Bradbury Street along the East property line . . . in order
that [Marathon Oil Company] and Ramada shall have a common joint driveway use
to serve both the service station and the Ramada Motor Hotel located in
the Park Fletcher Industrial Park.
(Emphasis added). Ramada alone executed both the Easement and the Rider, and
those documents were recorded on January 23, 1973.
Before Ramada executed the Easement in November 1972, Robert J. Isbell, Ramadas vice
president, reviewed and approved the Marathon Plot Plan dated July 14, 1972.
The Marathon Plot Plan was prepared showing north at the bottom, south at
the top, west on the right, and east on the left. Isbell
also reviewed and approved a survey dated August 29, 1972, prepared by Weihe
Engineers, Inc. Unlike the Marathon Plot Plan, the Weihe survey showed north
at the top, south at the bottom, west on the left, and east
on the right. However, both the Marathon Plot Plan and the survey
show that Bradbury Street borders the Ramada property and the Marathon Parcel to
the north, and that Ramadas property surrounds the Marathon Parcel on all remaining
sides. There are two easements, electrical and drainage, located on Ramadas property
to the east of the Marathon Parcel.
In 1982, David Ayres began operating the Marathon service station, and he was
familiar with the station under its prior operator because he was employed at
another station nearby. When Ayres took over at the Marathon station, the
station and the hotel shared a common driveway on the west side of
the station, between the station and the hotel. On the east side
of the station there was a steep drainage ditch, incapable of being used
as a driveway. While Ayres operated the station, the stations sales volume
tripled, which resulted in an increase in traffic coming and going from the
station. That increase in traffic caused delays for cars waiting to enter
or exit the hotel parking lot from the common driveway between the two
businesses. In early 1984, the Ramada management erected large concrete barricades to
close off the entrance and exit to the hotel parking lot from the
common driveway between the two businesses. Those barricades routed traffic from the
Ramada parking lot out its main entrance farther west on Bradbury Street.
The barricades did not obstruct ingress and egress from Bradbury Street to the
service station.
In 1986, Ramada conveyed its parcel by Special Warranty Deed to S &
S. S & Ss title search conducted in connection with the conveyance
disclosed the recorded Easement and Rider. Prior to the sale, S &
S inspected the property. A survey completed two weeks after the sale
showed the location of the 25 INGRESS-EGRESS EASEMENT Inst. 73-4329 on the
east side of the Marathon Parcel. Inst. 73-4329 refers to the recorded
Easement and Rider.
In 1987, a United States Air Force jet crashed and destroyed the hotel
on S & Ss property. Ayres, who continued to operate the Marathon
service station, had to remove some of the barricades along the west property
line so that the government could use the service station as a staging
area for the recovery effort. Ayres and his employees later returned the
barricades to their original location.
In 1997, Marathon Oil Company transferred its interest in the Marathon Parcel to
Marathon by Quitclaim Deed. In 1999, a fire damaged the Marathon service
station, which caused the business to close. In January 2000, while Marathon
was in the course of rebuilding the station, William E. Cramer of Marathon
sent S & Ss legal counsel a letter, which provides in part:
[Marathon] owns the subject property located directly east of S & S Enterprises
[sic] parcel along Bradbury Street. Upon review of our survey, . .
., we found that concrete barriers have been erected across an area where
Marathon retains easement rights. For your review, Ive attached a copy of
the easement agreement entered into between Marathon Oil Company and [Ramada], predecessor to
S & S Enterprises.
Marathon plans on rebuilding this facility, and this letter is to serve as
notice that Marathon requires complete access to the 25 easement area. Once
Marathon begins construction of the new facility, we are willing to assist your
tenant[
See footnote
] with the relocation of these barriers.
S & S gave Marathon permission to move the barricades, and Marathon moved
them to a location allowing full use of the area west of the
Marathon Parcel property line, which had been used as a driveway. Marathon
then completed construction and reopened its station.
In June 2000, S & S filed its complaint for trespass and injunctive
relief. The trial court denied S & Ss motion for a preliminary
injunction, and the court subsequently granted summary judgment in favor of Marathon on
the basis of mutual mistake. This appeal ensued.
Therefore, before we reach the substance of Marathons reformation argument, we must first
determine whether Marathon met its burden of establishing as a matter of law
through the designated facts that S & S is not a bona fide
purchaser. See T.R. 56(C).
5. There was no ingress/egress space between the barriers to enter the Marathon property
from the real estate of S & S.
6. I expressly and specifically recall that on those occasions which I purchased gas
from the Marathon Gas Station adjacent to the S & S property, it
was necessary for me to exit the S & S property onto Bradbury
Street, and then re-enter the Marathon gas Station from Bradbury Street via the
curb cut on the Marathon property which provided ingress and egress to Bradbury
Street.
Singhs Affidavit corroborates Sainis statements regarding the placement of the barricades on the
common boundary with Marathon Oil [Company] at Marathons west boundary . . .
Singh stated further that [t]he apparent purpose of the barricades was to
deny travel by Marathon patrons through the private property of Ramada.
Contrary to S & Ss assertion, the material facts relevant to the issue
of notice are not in dispute. In particular, it is undisputed that
the area east of the Marathon Parcel property line is a steep embankment
which leads into a drainage culvert. S & S admits that, at
the time it physically inspected the property before it purchased the property from
Ramada, it was aware of the drainage ditch along the east side of
the Marathon Parcel. Singh testified that he walked along the drainage ditch
at some point. While there is a dispute whether that area could
ever be developed into a common driveway, it is undisputed that the area
has never been used as a driveway by the parties or their predecessors.
Rather, the evidence shows that the area west of the Marathon Parcel property
line has been used as a driveway for ingress and egress from the
service station to Bradbury Street. Specifically, Ayres testified that both the service
station and the hotel used the driveway for some time and that after
Ramada erected barricades in 1984, the service station continued to use the driveway.
That evidence is undisputed.
As this court stated in Fenley Farms, Inc. v. Clark, 404 N.E.2d 1164,
1171-72 (Ind. Ct. App. 1980):
The law has always imputed to a purchaser of land all information which
would have been conveyed by an actual view of the premises, and when
one purchases property where a visible state of things exists which could not
legally exist without the property being subject to some burden, he is taken
to have notice of the nature and extent of the burden.
Here, given that the express purpose of the non-exclusive easement was to provide
a common joint driveway to serve both the hotel and service station, S
& S should have noticed when it inspected the property and observed that,
contrary to the Riders description of the easements location, the east side of
the Marathon Parcel consisted of an undeveloped and steep drainage ditch and, consistent
with the language of the original Easement, along the west side of the
parcel there was a driveway with access to Bradbury Street. Based on
the undisputed facts, we agree with Marathon that S & Ss physical inspection
was sufficient to place it on inquiry regarding the true location of the
twenty-five-foot easement. See Keybank, 699 N.E.2d at 327.
See footnote
Still, S & S points out that given the location of the barricades
at the time it purchased the property from Ramada, it was impossible for
the area west of the Marathon Parcel to be used as a common
driveway because a person pulling into that driveway from Bradbury Street had no
direct access to the hotel. Rather, the driveway only served the service
station. While the driveway may not have been used as a common
driveway at the time S & S inspected the property, it is undisputed
that it was the only driveway which was similar to that described in
the Rider. Indeed, there was no driveway with access to Bradbury Street
along the east side of the Marathon Parcel. Again, the location of
the driveway along the west side of the Marathon Parcel, together with the
presence of the steep embankment and drainage ditch along the east side, was
sufficient notice as a matter of law that S & S should inquire
further about the location of the twenty-five-foot easement contained in the Rider.
See Mishawaka St. Joseph Loan and Trust Co. v. Neu, 209 Ind. 433,
196 N.E. 85, 89-90 (1935) (stating notice of facts which would lead an
ordinarily prudent man to make an examination which, if made, would disclose the
existence of other facts, is sufficient notice of such other facts); Cf. Ayres
v. Lucas, 116 Ind. App. 431, 63 N.E.2d 204 (1945) (affirming trial courts
finding that residents were bona fide purchasers and stating that residents knowledge that
they had gas piped into their home, absent other visible signs, was not
sufficient to charge them with knowledge that main pipe-line was located under surface
of their land, nor was it sufficient to put reasonably prudent person upon
inquiry). Therefore, we conclude that Marathon met its burden of proof in
establishing that S & S is not a bona fide purchaser insofar as
the easement is concerned.
Id. (quoting Pearson v. Winfield, 160 Ind. App. 613, 313 N.E.2d 95, 99
(1974)). When granted in equity, reformation overcomes the presumption that the written
instrument expresses the parties intentions. Id. at 160. Stated differently, reformation
overcomes the Statute of Frauds and has the potential to affect others beyond
any immediate dispute. Id. Thus, to succeed in a reformation action
a party must show both mutual mistake and the original intent or agreement
of the parties by clear and convincing evidence. Id.
In support of its summary judgment motion, Marathon designated
Isbells Declaration, which explains in part that while he was vice president of
Ramada, he executed the Option to Purchase agreement. Isbell also executed the
Easement on behalf of Ramada after he had reviewed both the Marathon Plot
Plan dated July 14, 1972, and the survey prepared by Weihe Engineers, Inc.
dated August 29, 1972. Isbell stated further:
7. My current examination of [those] documents reveals that both the Marathon Plot Plan
and the Weihe survey showed an existing driveway/curb cut on the Ramada Parcel
immediately adjacent to the West property line of the Marathon Parcel. Based
on my current review of the Weihe survey, there was a steep drainage
culvert that abutted the east side of the Marathon Parcel. As shown
on the Weihe survey . . . there is a vertical drop of
approximately 19 feet (elevation 749.2 minus 730.75) from the easternmost boundary of the
Marathon Parcel to the center line of the drainage culvert, the center line
being a distance of approximately 35-40 feet from the easement boundary of the
Marathon Parcel.
8. Although the Easement referred to the West property line, the Easement did not
specify whether it was the West property line of the Marathon Parcel or
the West property line of the [Ramada] parcel . . . .
To better define the location of the common joint driveway in the
Easement, [Ramada] prepared and I executed the Rider to easement Dated November 13,
1972 between RAMADA INDIANA, INC. as Grantor and MARATHON OIL COMPANY, as Grantee.
[Reference to attached exhibit omitted].
9. The Rider provided that the 25-foot easement would run from from Bradbury Street
along the East property line of the real estate described on Exhibit B
in order that MARATHON and RAMADA shall have a common joint driveway use
to serve both the service station and the Ramada Motor Hotel located in
the Park Fletcher Industrial Park. The real estate described on Exhibit B
was the Marathon Parcel.
10. [Ramada] would not have intentionally conveyed an easement to Marathon [Oil Company] that
was not useable. Based on my current examination of the documents, an
easement along the East property line of the real estate described on Exhibit
B (The Marathon Parcel) was not usable as a common driveway with the
Ramada Inn because of the steep embankment and drainage culvert, while an easement
on the West property line of the Marathon Parcel could be used for
that purpose. I conclude that the intention of the original easement and
the Rider was for the easement to be on the Ramada Parcel immediately
adjacent to the West property line of the Marathon Parcel.
Marathon also designated the Declaration of David Holley, a Land Surveyor with Kimbley
& Proctor, Inc. (Kimbley & Proctor). Holley stated in part that in
December 1999, Marathon hired Kimbley & Proctor to prepare a Boundary and Topographic
Survey of the Marathon Parcel. Holley stated the following regarding the Easement
and Rider:
6. Upon my review of the easement and the Rider and a
visual inspection of the Marathon Parcel, I became aware of an inconsistency in
the location of the 25-foot easement and noted in the Surveyors Report on
the face of the Survey my conclusion as to the location of the
25-foot easement, as follows:
The 25 foot non-exclusive Easement for a common joint driveway as described in
an Easement recorded January 23, 1973 as Instrument No. 73-4329 was originally located
along the West line of the subject property. A rider attached to
this easement amended the location of this Easement to the East side of
the subject property. This would have located the common joint driveway in
the drainage ditch East of the subject property. The common drive as
used, apparently for many years, is located along the West line of the
subject property and was shown as such on this survey, subject to the
above described uncertainty.
10. The easement references a Preliminary Plot Plan dated July 14, 1972 prepared by
Marathon Oil Company, and survey dated August 29, 1972, prepared by [Weihe].
[References to attached Exhibits omitted.] The Preliminary Plot Plan is prepared with
Bradbury Street at the bottom, with the north arrow pointing down, east on
the left and west on the right. The [Weihe] survey, on the
other hand, is prepared with Bradbury Street at the top, with the north
arrow pointing up, east on the right and west on the left.
This may have created confusion on the part of the original drafters of
the Easement as to which side of the Marathon Parcel was east and
which was west, and the Rider was probably prepared and executed to correct
a perceived error in the original Easement which did not exist.
11. Based on my professional judgment and experience as a licensed surveyor, an easement
for a common joint driveway located along the east side of the Marathon
Parcel would be useless to either the grantor or the grantee due to
the steep embankment and drainage culvert. However, an easement along the west
side of the Marathon Parcel can be used for a common joint driveway
for the benefit of the Marathon Parcel and the adjacent property west of
the Marathon Parcel which was retained by the grantor of the Easement, which
is consistent with current use and apparent use at the time I prepared
the Survey. The only logical, possible and useable location for an easement
for a common joint driveway was upon the real estate immediately adjacent to
the west property line of the Marathon Parcel, as depicted on the survey.
Further, Marathon designated Ayres Declaration, which establishes in part that the service station
and the hotel had shared the driveway on the west side of the
station, or the west side of the Marathon Parcel property line, until early
1984, when Ramada erected the concrete barricades. However, those barricades did not
interrupt the service stations continued use of the driveway.
In Estate of Reasor, 635 N.E.2d at 160, n.9, the court noted that
in reformation cases where the written instruments are ambiguous, the fact finder should
consider, together with parol and other evidence of the original intent of the
parties, what land the parties currently occupy or have occupied in the past.
See generally Fenley Farms, 404 N.E.2d at 1167-1171 (analyzing contested strip of
lands use over period of years on review of trial courts determination that
land was public roadway). Here, the undisputed evidence shows that before the
Marathon station was damaged by fire in late 1999, the station had been
using the area west of the Marathon Parcel property line as a driveway
with direct access to and from Bradbury Street. And before Ramada erected
barricades along that area, it also used the driveway for access to and
from Bradbury Street. Such use is consistent with the purpose expressed in
both the Easement and Rider.
In addition, Isbells Declaration establishes that, at the time Ramada executed the Rider,
Ramadas intent was to provide for a common joint driveway to serve both
the service station and the hotel. Significantly, Isbell stated that Ramada would
not have intentionally conveyed an easement to Marathon that was not [useable].
Given that an easement along the east property line of the Marathon Parcel
was not useable as a common driveway because of the steep embankment and
drainage culvert and an easement along the west property line of the Marathon
Parcel could be used for the purpose expressed in the Rider, Isbell concluded
that Ramadas intention was to grant Marathon an easement along the west property
line of the Marathon Parcel. Isbells Declaration is the only designated evidence
which addresses Ramadas intent. Indeed, S & S designated no contradictory evidence
to create an issue of fact on intent.
Further, Marathon presented evidence to establish a mutual mistake. Holleys Declaration shows
that because of the two depictions of the Marathon Parcel, namely, the Marathon
Plot and the Weihe Survey, one of which was drawn with north at
the top and the other of which was drawn with north at the
bottom, Ramada may have believed by mistake that it needed to execute the
Rider to clarify the location of the easement. Again, based on Isbells
testimony, the Riders description of the easements location was not what Ramada would
have intended. S & S did not designate any evidence to rebut
Holleys statements regarding the alleged mistake in the easements location.
Based on the undisputed designated evidence, we conclude that Marathon met its burden
of proving by clear and convincing evidence that Ramada intended to grant Marathon
an easement along the west side of the Marathon Parcel property line.
We further conclude that a mistake was made when Ramada executed the Rider
to the Easement, that the mistake was mutual on the part of both
Ramada and Marathon Oil Company, and that the Rider does not reflect the
true intentions of the parties. See Estate of Reasor, 635 N.E.2d at
158. We, therefore, hold that the trial court properly entered summary judgment
for Marathon.
Affirmed.
ROBB, J., and MATHIAS, J., concur.