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Eileen T. Quigley Inc. v. Miller Family Farms Inc.

Decided: July 15, 1993.

EILEEN T. QUIGLEY, INC., PLAINTIFF-APPELLANT, THIRD PARTY PLAINTIFF-APPELLANT,
v.
MILLER FAMILY FARMS, INC., CLEMENT E. MILLER AND NANCY MILLER, DEFENDANTS-RESPONDENTS, V. CHELSEA TITLE & GUARANTY COMPANY, THIRD PARTY DEFENDANT-RESPONDENT



On appeal from Superior Court, Chancery Division, Burlington County.

King, Landau and Thomas. The opinion of the court was delivered by Landau, J.A.D.

Landau

We consider and resolve today two separate but related appeals which concern a dispute about rights of defendants-respondents, Miller Family Farm, Inc., Clement E. Miller and Nancy Miller (Miller), to use private roadways within a mobile-home park conveyed to plaintiff-appellant, Eileen T. Quigley, Inc. (Quigley) by Miller, and a title insurance claim arising therefrom.

Quigley complained that Miller trespassed after the conveyance and sought an injunction against its continuance. When Miller claimed an easement through the Quigley property, Quigley sought to hold Chelsea Title & Guaranty Company (Chelsea), its title insurance carrier, responsible for costs of defending against the easement claim, and also requested indemnification for damages in the event its property was held subject to an easement.

By complaint and order to show cause in the Chancery Division on March 19, 1990, Quigley sought to enjoin continued use of its internal roadways by trucks and farm equipment moving to and from Miller's non-contiguous berry farm. Miller answered, asserting inter alia, defenses of equitable estoppel, laches, and both public and private easement rights. It also counterclaimed, contending that because absence of the easement would render its farm effectively landlocked, it had sought and received from Quigley both express and implied agreement to retain a right-of-way through the trailer park it conveyed.

Quigley amended its complaint to assert a trespass count, amended its answer to the counterclaim as amended, and filed a third-party complaint against Chelsea Title and Guarantee Company (Chelsea), whose assets and liabilities were acquired by Chicago Title Insurance Agency (Chicago) on December 17, 1990.

On December 20, 1990, following Chelsea's earlier default and a proof hearing on the third-party complaint, an order was entered requiring Chelsea to reimburse Quigley for its legal fees and costs to defend, as well as for the decrease in value which "may result . . . should subsequent litigation in this matter reveal the existence of such easement." Shortly before trial on the principal complaint and counterclaim, Chelsea moved to vacate this order. Decision on the motion was reserved.

On September 26, 1991, following trial in the Chancery Division, the Judge rendered an opinion which held that there was no express or implied easement established, but that Quigley's representative, William Gelinas, had orally agreed that the internal roadways would be regarded as public roads open to Miller. The Judge denied the injunctive relief requested by Quigley and instead ordered that it was "estopped and enjoined" from precluding Miller, its agents, servants and employees from using roads and trails within the Quigley property in order to gain access to the Miller farm. However, Miller's relief was expressly limited to such time as Quigley and the individual Miller defendants continued to own their respective lots, and was to terminate "in the event that either Plaintiff or the Defendants, Clement Miller and/or Nancy Miller, cease to own their respective lots." This ruling was embodied in a judgment dated October 10, 1991.

Thereafter, an appeal having been filed, we entered a limited remand to permit resolution of the reserved motion on the third-party complaint respecting Chelsea. On March 13, 1992, the trial Judge entered an order which vacated the December 20, 1990 default order, and adjudicated that Quigley's third-party complaint was dismissed with prejudice and without costs.

Quigley appeals from the October 10, 1991 judgment, and the March 13, 1992 order dismissing its third-party complaint against Chelsea. We reverse the judgment for Miller, and affirm the dismissal as to Chelsea.

Facts Underlying The Principal Claim

The Miller-Quigley title closing took place at Chelsea's office. Neither the closing statement (statement of settlement) signed by the parties nor the deed makes reference to any easement. The stated purchase price in both documents is $1,000,000.

Quigley is a corporation created solely for the purpose of acquiring the Miller mobile home facility known as Oakview Park.*fn2 Its shares are owned by a trust for the benefit of Eileen F. Quigley administered by William Gelinas, who negotiated the deal.

Gelinas testified that despite the existence of several unexecuted draft agreements, (one for $500,000; one for $600,000; one for $1.1 million), no contract was fully accepted and executed prior to the sale. The draft $1.1 million contract contained no provision for an easement. According to Gelinas, he was aware that Miller wanted to retain an easement for use of the Oakview roads. The $500,000 and $600,000 drafts were "the other side of the coin", enabling Miller to retain an easement. Thus, Gelinas testified, the $1,000,000 price finally fixed reflected Gelinas' unwillingness to allow the easement without a very substantial reduction in the purchase price.

Miller was represented at closing by an attorney, Lewis Farsetta. Gelinas, although not an attorney, attended the closing alone. He testified that there were no easement or right-of-way Discussions at the closing; that he asked Farsetta for a certificate of title; and that he received and relied upon a Corporate Title Affidavit given to him at that time, which represented that the land was not subject to any easement or encumbrances. He took this to include the easement which was the subject of their negotiations.

It appears that the roadways within the mobile home park are not the only means of access to the Miller farm. Red Onion Road, however, the principal alternate route pointed to by Quigley and considered by the court, is very narrow and rutted, making its negotiation difficult for heavy trucks transporting cranberries. That route would also take much longer to access the Miller farm. Its impassability was disputed at trial, but the Judge found that it would require improvement with fill to become passable by "normal vehicles." Although maintained by the Township, the road is not municipally owned. In fact, Red Onion Road may cross other private property as well as State forest land.

The internal Quigley roadways, however, also do not directly abut the Miller farm. Rather, they allow access to dirt roads within State forest lands through which farm access is gained. We note that mention was made below of a third ...


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