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ALC Development Corp. v. Walker, corrected 2-7-02
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MAINE SUPREME JUDICIAL COURT					Reporter of Decisions
Decision:	2002 ME 11
Docket:	Cum-01-429
Argued:	December 5, 2001
Decided:	January 18, 2002

Panel:CLIFFORD, RUDMAN, DANA, ALEXANDER, and CALKINS, JJ.

								
								

ALC DEVELOPMENT CORP.

v.

TIMOTHY J. WALKER et al.

ALEXANDER, J.

	[¶1] ALC Development Corp. was the developer of the Coulthard Farms
subdivision in Scarborough.  Ultimately all of the more than fifty lots were
sold, except Lot 1 which ALC retained.  ALC initiated a declaratory judgment
action{1} against the other lot owners in Coulthard Farms seeking a declaration
that it could use Lot 1 for an access road to support development of Wiley
Farms, an adjoining parcel of property.  Many lot owners defended against
ALC's action, and some filed counterclaims addressing various issues.  
	[¶2]  ALC now appeals and lot owners, Rizzi and Biber, the Bogles and
others (Bogles),{2} the Frickes, the Reynoldses and the Nahons (collectively "the
lot owners") cross-appeal from the August 3, 2001, amended order of the
Superior Court (Cumberland County, Humphrey, J.), granting a judgment: (1)
in favor of the lot owners on ALC's complaint seeking a declaratory judgment
that ALC's construction of a roadway on Lot 1 of the Coulthard Farms
subdivision does not violate the restrictive covenant or any other restrictions
in the deed; (2) in favor of ALC on a lot owners' counterclaim that ALC's
proposed use of a utility easement across Lots 5 and 6, for the benefit of Wiley
Farms, is an impermissible trespass on the lot owner's property rights; (3) in
favor of lot owners on a counterclaim that ALC's proposed use of a drainage
easement across Lot 6 for the benefit of Wiley Farms is an impermissible use of
the drainage easement; and (4) in favor of ALC on several lot owners'
counterclaims alleging a violation of the Unfair Trade Practices Act, 5 M.R.S.A.
§§ 205A-213 (1989 & Supp. 2001), by ALC.  We affirm. 

I. CASE HISTORY

	[¶3]  In 1994, ALC acquired a parcel of land in Scarborough, now
known as the Coulthard Farms subdivision.  ALC subsequently subdivided
Coulthard Farms into fifty-seven lots and retained Lot 1 for itself.  ALC made
each deed in Coulthard Farms subject to certain conditions and restrictions. 
Among those restrictions were both a residential use restriction and a
restriction regarding structures, as follows:

	1. Residential Use.  No lot shall be improved or used
except for single family residential purposes, with no more than
one principal residence and said principal residence shall have
a minimum of 1,700 square feet of available living space as
measured by the area above continuous foundation.  No
temporary structure or tent shall be used as a residence. 

	2.  Structures.  No other buildings or structures of any
nature or description shall be erected or maintained on said
premises, provided, however, that nothing in this paragraph
shall be construed to prevent the construction of a barn,
storage shed, cabana, pergola, fence or in-ground swimming
pool; however, no above ground pools shall be permitted.  Any
such building or structure shall be consistent in design and
materials with the single family dwelling constructed on the
lot.

	[¶4]  Additionally, the deeds of all Coulthard Farms lots stated that
"the parcel described herein is subject to any and all easements and
restrictions as noted on said recorded plan of Coulthard Farms and to utility
and access easements of record."  ALC also granted to a developer of an
adjacent subdivision, Settlers Green Estates, a right to use the roadways and
utility easements indicated on the Coulthard Farms subdivision plan.
	[¶5] The relevant individual deeds to lot owners also reserved to ALC
(Grantor) a utility easement as follows: "Grantor excerpts [sic], reserves and
retains from the foregoing premises a 15-foot wide strip of land as an easement
for the underground construction, laying and maintenance of sewer and utility
lines, said easement being set forth on the said record plan and particularly
described . . . ."  The Coulthard Farms subdivision plan indicates a thirty-foot{3}
utility easement along the boundary of several lots, including Lots 5 and 6.  
	[¶6]  The subdivision plan also indicates a thirty-foot drainage
easement along the rear boundary of Lots 1 through 6, turning ninety degrees
and proceeding across Lots 6 and 7, then crossing Lots 40 and 39, taking
another ninety degree turn and proceeding along or near the rear boundaries of
Lots 38 through 30, then discharging into a resource protection reserved area
of the development.  The evident purpose of the drainage easement is to carry
surface water originating in the development and on higher land above the
development on a defined course through the development, skirting the
buildable portions of the defined lots.  The drainage easement, but not the
utility easements, were addressed in listed restrictive covenants that were
specified to "run with the land."  Thus, paragraph five of the restrictive
covenants stated that lot owners could not alter the natural flow of surface
water across their lots, but: "[t]his provision shall not be construed to prevent
the proper improvements or maintenance of drainage easements shown on said
Plan."  
	[¶7] In June 1999, ALC acquired an adjacent lot of land upon which it
proposes to build a subdivision to be known as the Wiley Farms subdivision. 
ALC submitted a development plan to the Town of Scarborough in December
1999 that included the development of an access road to Wiley Farms over Lot
1 of Coulthard Farms.   One of the subsequent proposed plans for Wiley Farms
included ALC's intent to use the utility easements between Lots 5 and 6 and
the drainage easement traversing many lots.
	[¶8]  ALC filed a complaint which sought a declaratory judgment
pursuant to 14 M.R.S.A §§ 5951-5963{4} and M.R. Civ. P. 57,{5} that its
construction of the roadway on Lot 1, servicing Wiley Farms, would not violate
the restrictive covenant or any other restrictions of record.  Several lot owners
answered ALC's complaint, denying ALC's allegation that the proposed roadway
over Lot 1 did not violate the restrictive covenant within the deeds.  Several
other lot owners had agreed to ALC's proposed use or were defaulted.  The
owners of Lots 5 and 6 counterclaimed alleging that ALC's proposed use of the
drainage and utility easements, which bordered their lots, for the benefit of
Wiley Farms, would constitute a trespass or wrongful invasion of, and
unlawful interference with, their property rights.  An Unfair Trade Practices Act
counterclaim was also asserted by some of the lot owners, alleging that ALC's
declaratory judgment action constituted an unfair trade practice under the Act.  
One lot owner counterclaimed against ALC alleging fraud and
misrepresentation.  
	[¶9]  Both ALC and the residents of Coulthard Farms filed motions for
summary judgment.  The Superior Court found in favor of ALC with respect to
the utility easement, UTPA, fraud and negligent misrepresentation claims.  The
court found in favor of the lot owners with regard to the proposed roadway over
Lot 1 and the drainage easement.  ALC as well as five of the lot owners who
answered ALC's complaint have appealed the Superior Court judgment.

II. DISCUSSION

	[¶10]  Deed construction is a question of law that we review de novo. 
Bennett v. Tracy, 1999 ME 165, ¶ 7, 740 A.2d 571, 573.  In interpreting a deed,
the words of the deed are given their general and ordinary meaning to see if
they create an ambiguity.  Id. ¶ 8 .  If the terms of the deed are unambiguous, 
then the language determines the parties' intent; however, if the terms are 
ambiguous, the court may look to extrinsic evidence for guidance.  Id.
 
A.	The Proposed Roadway Over Lot 1

	[¶11]  The Superior Court determined that the intended use of the
proposed roadway across Lot 1 was not to service a single-family residence, but
instead to service an entire subdivision of residences.  The court concluded
that such a use was not a single-family residential purpose, and was, therefore,
violative of the plain language of the residential use covenant in the deed. 
	[¶12]  The language of the restrictive covenant contained in the deeds 
is unambiguous.   It provides that "[n]o lot shall be improved or used except for
single family residential purposes."  Citing Boehner v. Briggs, 528 A.2d 451 (Me.
1987), ALC argues that the construction of the road on Lot 1 is permissible
under the language of the restrictive use covenant provided that the road
services only single-family residences and not multi-family dwellings or
commercial structures.  Boehner, however, involved a building restriction, not a
use restriction.  The restriction in Boehner goes to the type of dwelling, whereas
the restriction within the Coulthard Farms deeds goes to the use of the lot in
general.  The proposed use of Wiley Farms is irrelevant to whether the roadway
complies with the lot's use restriction.  The use of Lot 1 for construction of a
roadway to access another subdivision is inconsistent with the single-family
residential use restriction that ALC imposed on all lots in the Coulthard Farms
subdivision, including Lot 1.
	[¶13]  Based on the plain language of ALC's deed restrictions, we affirm
the Superior Court's determination that ALC's proposed construction of a
roadway would violate the restrictive covenant within the deed.

B.	The Utility and Drainage Easements 
  
	[¶14]  In Anchors v. Manter, 1998 ME 152, ¶ 10, 714 A.2d 134, 138, we
stated that easements in gross are "[e]asements that are intended to be
personal rights and do not profess to create a benefit in favor of any land." 
Conversely, appurtenant easements are "created to benefit [a] dominant
tenement and therefore run with the land."  Id. (internal citations and
quotations omitted).  See also Stickney v. City of Saco, 2001 ME 69, ¶¶ 31­p;32,
770 A.2d 592, 605; O'Donovan v. McIntosh, 1999 ME 71, ¶¶ 7, 10, 728 A.2d 681,
683-84.  Whenever possible an easement should be fairly construed to be
appurtenant to the land of the person for whose use the easement is created. 
Stickney, 2001 ME 69, ¶ 33, 770 A.2d at 605; Anchors, 1998 ME 152, ¶ 10, 714
A.2d at 138; O'Neill v. Williams, 527 A.2d 322, 323 (Me. 1987).

	1.  The Utility Easement

	[¶15]  The Superior Court held that the utility easement was in gross,
because there is no dominant tenement.  As noted above, an easement in gross
does not benefit any dominant tenement.  In this case, the record indicates
that the utility easement was expressly reserved to ALC in the relevant deeds. 
It has not yet been used and appears to serve no purpose for the Coulthard
Farms subdivision, but instead appears to serve as a way to transport utility
services to adjacent property.  Therefore, the utility easement does not benefit
Coulthard Farms as the dominant tenement.  The utility easement is in gross
and personal to ALC.
	[¶16]  The lot owners argue that the utility easement was created to
benefit Coulthard Farms by furthering the development and sale of the lots
within the subdivision.  In the alternative, they argue that the utility easement
benefits ALC in its ownership of Lot 1.  There is no evidence that the unused
utility easement either benefitted or would now benefit the sale and
development of Coulthard Farms.  To the contrary, the utility easement was
reserved to ALC, with ALC granting a right of use to the developer of an
adjacent subdivision.  The utility easement may be used to benefit Wiley
Farms, because it was reserved and retained by ALC for its own use.  Therefore,
we affirm the Superior Court's ruling that ALC may exercise its use of the
utility easement over Lots 5 and 6 to benefit Wiley Farms.

	2. The Drainage Easement

	[¶17] Easements are presumed to be appurtenant if there is a dominant
tenement and there is nothing to show that the parties intended the easement
to be personal.  See Anchors, 1998 ME 152, ¶ 10, 714 A.2d at 138.  Unlike the
utility easement, the dominant tenement with respect to the drainage
easement is Coulthard Farms.  The drainage easement benefits many lots in
Coulthard Farms via the swales that create a controlled pathway for surface
water runoff through the development.  In the absence of these swales, the lots
in Coulthard Farms may become eroded or flooded with surface waters. 
Paragraph five of the restrictive covenant within the deeds to Coulthard Farms
provides support for the view that the drainage easement benefits the
Coulthard subdivision:

5. Surface Water.  No owner of a lot, his agents or employees
shall alter the natural course of surface water on any lot
in a way which would materially alter the natural flow of
such water across any other lot unless such alteration is
approved by the owners of all lots affected.  This provision
shall not be construed to prevent the proper improvements
or maintenance of drainage easements shown on said plan.

 
	[¶18] The reference to the drainage easement in a restrictive covenant
that is to "run with the land" and the drainage easement's important benefit to
the Coulthard Farms lots confirm its status as an appurtenant easement. 
Accordingly, we affirm the Superior Court's determination that the drainage
easement is appurtenant to Coulthard Farms and may not be used by ALC for
the benefit of the Wiley Farms property.

	C. Unfair Trade Practices Act	

	[¶19] Title 5 M.R.S.A. § 207 of the UTPA states: "[u]nfair methods of
competition and unfair or deceptive acts or practices in the conduct of any
trade or commerce are declared unlawful."  We have stated that "[w]hether an
act or practice is unfair or deceptive for the purposes of section 207 of the
UTPA cannot be defined precisely and must be determined by the factfinder on
a case by case basis."  Binette v. Dyer Library Ass'n, 688 A.2d 898, 906 (Me.
1996).  The owners of Lot 44 alleged that ALC's lawsuit was a violation of the
UTPA, because it subverted the restrictions in the deed.  The Lot 44 owners
assert that they now own a lot that they may not have otherwise purchased
and that their lot may depreciate in value if Lot 1 is used for a purpose other
than a single-family residence.
	[¶20]  The Superior Court held that ALC did not violate the UTPA, 5
M.R.S.A. §§ 205-A­p;213, when it filed a declaratory judgment action, because
the filing of this declaratory judgment action was not an unfair or deceptive
act.   
	[¶21]  We agree with the Superior Court that a declaratory judgment
action brought to interpret a restrictive covenant is not, as a matter of law, an
unfair or deceptive act as contemplated by the UTPA.  A deceptive practice must
be "substantial," as articulated in Bangor Publ'g Co. v. Union Street Mkt., 1998
ME 37, ¶ 7, 706 A.2d 595, 596.  Even assuming that the filing of a declaratory
judgment action could be considered deceptive, ALC's actions in this case do
not rise to the level of being substantial.  The lot owners presented no specific
evidence to show that ALC attempted to deceive the purchasers of the
Coulthard Farms lots.  Therefore, we affirm the Superior Court's determination
with respect to the defendants' UTPA claim.
	The entry is:
				Judgment affirmed.
Attorneys for plaintiff:

David M. Hirshon, Esq. (orally)
Marshall J. Tinkle, Esq.
Lawrence R. Clough, Esq.
Tompkins, Clough, Hirson & Langer, P.A.
P O Box 15060
Portland, ME 04112

Attorneys for defendants:

Sally J. Daggett, Esq.  (orally)
Jensen Baird Gardner & Henry
P O Box 4510
Portland, ME 04112

David B. McConnell, Esq.  (orally)
Peggy L. McGehee, Esq.
Perkins, Thompson, Hinckley & Keddy, P.C.
P O Box 426
Portland, ME 04112-0426

Timothy H. Boulette, Esq.  (orally)
John C. Bannon, Esq.
Barbara T. Schneider, Esq.
Murray Plumb & Murray
P O Box 9785
Portland, ME 04104-5085

David S. Sherman Jr., Esq.  (orally)
John A. Graustein, Esq.
Drummond Woodsum & MacMahon
P O Box 9781
Portland, ME 04104-5081

Joseph & Mary Ann Nahon
12 Haystack Circle
Scarborough, ME 04074