Knaresborough Enterprises, LTD v. Dizazzo, 2021 VT 1
Easement? I don’t need
no stinkin’ easement
By Andy Delaney
There’s nothing like lake access to get neighbors’ hackles up. This opinion hails from the shores of Lake Champlain.
Plaintiff’s predecessor-in-interest had granted defendants’ predecessor-in-interest an easement for access to a beach on plaintiff’s property. Plaintiff wasn’t thrilled with the situation and filed a declaratory judgment action in the civil division to determine the extent of what rights, if any, the defendants had to access the beach. The trial court issued partial summary judgment to defendants concluding that the easement was appurtenant (if you don’t want to look up “appurtenant” like I did, just think “belonging”) to the defendants’ land. The trial court left alone the issue of whether the defendants’ use of the land had overburdened the easement, however. Plaintiff moved to reconsider and the trial court—it seems—reopened the whether-the-easement-was-actually-appurtenant-to-the-defendants’-land issue. Before final hearing, the parties stipulated that the easement was appurtenant and that defendants could use the easement for boat-related activities. Jet skis and such were left for the final hearing.
Side note: even SCOV drops a footnote explaining the difference between an appurtenant easement (“runs with the land”) and an easement in gross (“runs with the person”). This makes me feel not-quite-so dumb.
Ultimately, the parties had settlement discussions mid-final-hearing and mostly worked things out. Plaintiff, however, claimed the parties had agreed to binding arbitration—said so in the hearing—and submitted a proposed final order with a binding-arbitration provision. Defendants never affirmed that representation however. When the arbitration discrepancy came up in the final-order-signing process, the trial court told the parties to get a copy of the transcript. The transcript showed that plaintiff’s attorney said they’d all agreed to binding arbitration for further disputes. Defendants’ attorney never confirmed that representation but also didn’t make a big ol’ stink about it. The trial court did a steamroller and signed the binding-arbitration-included order.
Defendants moved for reconsideration and asked the trial court to enforce the order because plaintiff had already thrown up posts in the right-of-way in contempt of the order. The trial court said, “Nope. Arbitration.” So, defendants moved to have the arbitration provision struck because Vermont law requires a written acknowledgement of arbitration and there wasn’t any such acknowledgement here. Defendants also filed a notice of appeal. The trial court denied the motion.
So, defendants appeal. The issue is whether a trial court can order binding arbitration for future disputes based on one party’s representation that there was an oral agreement for the same. As it turns out, the trial court ought not do that.
SCOV begins by acknowledging that arbitration is generally a good thing in its view. But, SCOV explains, arbitration is an agreement and you can’t just force it without that agreement. Because there’s no statute or law identified by the parties that would authorize this type of court-ordered binding arbitration, SCOV narrows the issue to “whether the parties’ alleged oral stipulation was sufficient to create an enforceable agreement.”
SCOV notes that generally, an arbitration agreement must be in writing to be enforceable. SCOV also notes that Vermont’s Arbitration Act requires the signed acknowledgment of arbitration so that folks don’t unwittingly waive their right to address grievances in court. As we already know, there’s no acknowledgment of arbitration in this case.
Plaintiff tries to argue that the defendants’ failure to object acts to estop defendants from arguing that they never agreed to arbitration. While SCOV agrees that an on-the-record agreement could, in theory, create a binding agreement to arbitration, there was no such affirmative agreement on the record from the defense here. SCOV holds: “for a party to effectively waive the statutory requirements of a written arbitration agreement and acknowledgement, the waiver must be clear and unequivocal.” Consequently, SCOV reasons that the defendants here did not unequivocally agree to the material terms of an arbitration agreement, nor did they “waive their statutory right to a written acknowledgement of arbitration.”
SCOV rejects any argument by the plaintiff that the defendants failed to preserve their right to appeal, noting that the defendants repeatedly attacked the arbitration provision and in no way acquiesced to it.
So, this one gets sent back to the trial court to strike the arbitration provision and make a determination whether the remainder of the order should stand.
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