By
Jeff Thomson
Knappmiller v. Bove,
2012
VT 38 (mem.).
Some
cases should never go to trial. Many
disputes are better suited for the mediation table than the court room. Small disputes between neighbors often belong
in this category, because mediation can help maintain neighborly relations and prevent
significant legal fees. Unfortunately,
some neighbors are unable to see the forest for the trees.
In
today’s case, Defendants’ decision to remove a row of white cedar trees along their
property line led to the initiation of a law suit by their neighbor, Plaintiff,
who believed that the trees were located on his property. Plaintiff not only sued the Neighbors, but
also included as co-defendant, the landscaping company hired to remove the
trees. This led to the Landscaper
bringing a cross-claim against the Defendants for negligence, breach of
contract, and indemnity. Landscaper’s
cross-claim alleged that it had entered into a contract with Defendants, and
that the Defendants should have informed Landscaper about tree ownership issues
with Plaintiff before the trees were cut down and removed.
After
a two-day trial and many billable hours, the jury found for the Defendants. The jury found that Plaintiff had not proven
the trees were wrongfully cut.
Therefore, the trial court never had to reach the Landscaper’s
cross-claim against the Defendants.
Landscaper
was not satisfied with this result because it left Landscaper on the hook for its
legal expenses. Landscaper filed a
post-trial motion seeking litigation expenses, including attorney’s fees, under
a theory of implied indemnity from Defendants. The trial court denied Landscaper’s motion,
stating that indemnity was not available absent any finding of wrongdoing on
the part of Defendants.
This
unfortunate string of events leads us to the issue on appeal to the SCOV. Landscaper argued that the trial court’s
ruling is inconsistent with Windsor
School District v. State, 2008 VT
27, which they argue stands for the proposition that Vermont case law does
not require a finding of wrongdoing before attorney’s fees and litigation
expenses may be awarded based on a theory of implied indemnity.
Vermont
normally requires parties to bear their own attorney’s fees and costs of
litigation, absent a statutory or contractual provision to the contrary. The SCOV has recognized an exception to the
rule when “the wrongful act of one person has involved another in litigation
with a third person or has made it necessary for that other person to incur
expenses to protect his interests.” Albright
v. Fish, 138 Vt. 585, 591, 422 A.2d 250, 254 (1980).
The
SCOV explains that some underlying culpability must appear from the record
before attorney’s fees can be awarded under this exception
and the burden is on the party seeking indemnity to prove culpability.
In
the end the SCOV finds that Landscaper’s claim is too vague to meet its burden
of proving that Defendants were culpable.
In ruling on the claim, the SCOV discusses the Windsor case in some detail.
In that case, the Town of Windsor bought land that was previously owned
and polluted by the State’s Department of Corrections. The town sued the State, seeking reimbursement
for money that the Town spent investigating and remediating the pollution. The trial court concluded that both the Town and
the State were strictly liable under the Vermont Waste Management Act, and
therefore both were liable for cleanup. On
appeal, the SCOV found that the State was liable for the Town’s expenses based
on common-law indemnification under Albright,
under which the Court may consider the “kind and quality of the conduct.” Because the State acted alone to pollute the
property and the Town was a mere purchaser, the Town was subject to great
financial liability for the costs it incurred during remediation. Therefore, the “kind or quality of conduct”
was enough to trigger the Albright
exception.
As
the SCOV explains:
Contrary
to [Landscaper’s] contention, Windsor
does not abandon the wrongful act element, but merely explains the rationale
behind prior case law and notes that a finding of fault is not a necessary
predicate to an award of attorney’s fees in the context of that case with its
distinct premise of strict liability . . .
We do not extend Windsor to
cases such as this where the jury specifically found no fault, no liability,
and no underlying responsibility.
The
SCOV focuses on the “kind and quality of the parties’ conduct” to distinguish Windsor with the facts in question. In Windsor,
the trial court found that the State polluted the land, while the Town merely
purchased it. Because the court found
that the State had wholly caused the pollution and the Town “played virtually
no role,” there was a basis under Albright
for an award of attorney’s fees.
Here,
however, the jury specifically found neither the Defendants nor Landscaper
liable for any wrongful act. Therefore,
the SCOV finds that the Defendants are not on the hook for Landscaper’s
expenses.
In
the end a relatively minor dispute turns into an expensive headache for all
involved. Sometimes everyone loses when
disputes are brought to trial. Plaintiff
has no tree line, and all parties have legal expenses to cover. It seems obvious in retrospect that these
sorts of disputes require creative resolutions.
Imagine
if Plaintiff had simply hired Landscaper to plant trees on his side of the
property line rather than sue. Maybe the
Defendants would have covered some of the cost.
While this “what if” scenario may not have been possible, it seems clear
the morning after that a little creativity would have led to a better
resolution for all.
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