Nevius v. Palomares

314 Or.App. 193

496 P.3d 1130

John NEVIUS and Mary Von, husband and wife, Plaintiffs-Appellants,

v.Efrain PALOMARES and Robyn Palomares, husband and wife, Defendants-Respondents.

A170148

Court of Appeals of Oregon.

Argued and submitted January 15, 2021

September 1, 2021

Peter D. Mohr, Portland, argued the cause for appellants. Also on the briefs was Jordan Ramis PC. On the reply brief was also Christopher K. Dolan.

Montgomery W. Cobb, Portland, argued the cause for respondents. Also on the brief were Montgomery W. Cobb, LLC; and Lewis T. Farmer and The Bridge Law Firm.

Before Ortega, Presiding Judge, and Powers, Judge, and Kamins, Judge.

KAMINS, J.

Plaintiffs filed this action for declaratory and injunctive relief against defendants, asserting that defendants refused to comply with the terms of an easement. Defendants filed a motion to dismiss under ORCP 21 A(1) for lack of subject matter jurisdiction and ORCP 21 A(8) for failure to state ultimate facts sufficient to constitute a claim for relief. The trial court dismissed plaintiffs’ claims, but it did not specify the grounds on which it did so. For the reasons set forth below, we reverse.

On review of a grant of a motion to dismiss under ORCP 21 A, we assume the truth of all well-pleaded factual allegations in the complaint and make reasonable inferences from those allegations in favor of plaintiffs. Herinckx v. Sanelle , 281 Or. App. 869, 871, 385 P.3d 1190 (2016) ; Kutz v. Lee , 291 Or. App. 470, 472, 422 P.3d 362 (2018). We state the facts in accordance with that standard.

An agreement entitled "Declaration of Easement for Irrigation Water Service Line and Agreement for Shared Use" (the easement) was recorded in 2006, before either plaintiffs or defendants bought their respective properties. The easement provides that plaintiffs are entitled to "one acre/foot per acre but not to exceed forty-one and one quarter acre/feet of [irrigation] water" and that, to receive that water, plaintiffs have the right to access a 15-foot wide strip of land on defendants’ property "for the construction, reconstruction, maintenance, and repair of an irrigation service line and necessary appurtenances thereto." Additionally, under the terms of the easement, plaintiffs and defendants "shall each be responsible for the payment, if any, for the base amount of water attributable to each such parcel, and each shall be solely responsible for any water used over that amount on each such owner(s) property."

Plaintiffs purchased their property in 2008, and defendants purchased their property in 2013. From 2013 to 2017, defendants accepted plaintiffs’ payments for irrigation water and otherwise performed all conditions required of them under the easement, including allowing plaintiffs access to the irrigation service line on and across defendants’ property. However, in April 2018, defendants refused to accept plaintiffs’ tendered water payment, asserting that they were not subject to the easement either because the easement did not run with defendants’ property or because defendants were not a party to it. Accordingly, defendants informed plaintiffs that they had no duty to provide plaintiffs with irrigation water and that they would not allow plaintiffs to access defendants’ property, despite the terms of the easement.

After the irrigation season began on May 1, 2018, plaintiffs contacted defendants through counsel to demand that they comply with the terms of the easement. When those demands proved unsuccessful, plaintiffs filed this action on August 3, 2018. Plaintiffs’ complaint and the accompanying summons was served to defendants on August 8, 2018. According to the complaint, defendants did not, at any time during the 2018 irrigation season, "allow the passage of irrigation water to Plaintiffs’ Property" until August 6, 2018—after the complaint was filed, but before it was served.

Defendants filed a motion to dismiss, in which they characterized the dispute as "a one-time non-continuous misunderstanding of Defendants as to the existence of an easement of their property." Defendants argued that, "[p]rior to Plaintiffs’ filing of the Complaint herein, Plaintiff's attorney was made aware that Defendants, after being made aware of the easement at issue, did not controvert its existence or enforceability" and, consequently, any prior controversy as to the existence or enforceability of the easement was resolved prior to the filing of the complaint. Defendants argued in the alternative that plaintiffs failed to state ultimate facts sufficient to constitute a claim for relief, contending that the order that plaintiffs sought would have "the same effect as the easement at issue in this matter. Therefore, no order of the Court [could] provide Plaintiffs with any relief not already provided for by Oregon contract law."

Plaintiffs filed a response to defendants’ motion, in which they reiterated their allegations that defendants were already aware of the easement and had complied with it prior to the 2018 irrigation season, and that defendants did not allow for the flow of water to plaintiffs’ property until after the complaint was filed. Accordingly, plaintiffs argued that there was still a justiciable controversy as to plaintiffs’ claim for declaratory relief because defendants had "made no express admission that [the easement] is valid, that it burdens their property, that it runs with the land, and that [it] is binding on them." Additionally, plaintiffs argued that because, contrary to defendants’ description, the dispute did not arise from a singular misunderstanding that has been subsequently rectified, defendants’ voluntary action of allowing the water to flow after the complaint was filed was not sufficient to render the controversy moot.

Defendants did not file a reply, and the parties did not request oral argument. The trial court granted defendants’ motion to dismiss and ultimately dismissed plaintiffs’ claims with prejudice in a general judgment, which plaintiffs appeal.

On appeal, plaintiffs argue that the trial court erred by granting defendants’ motion to dismiss on either the ground that the court lacked subject matter jurisdiction ( ORCP 21 A(1)) because the case was moot or that plaintiffs failed to allege ultimate facts sufficient to constitute a claim for relief ( ORCP 21 A(8)). First, we note the procedural difference between the two grounds on which defendants based their motion to dismiss. When a trial court considers a motion to dismiss under ORCP 21 A(1), "the court may consider matters outside the pleading, including affidavits, declarations, and other evidence"; consideration of motions to dismiss under ORCP 21 A(8), by contrast, "is limited to the complaint." Kutz , 291 Or. App. at 480, 422 P.3d 362 (emphasis in original). On review, we determine whether the trial court erred in its judgment.

To determine whether plaintiffs stated a claim, which, if proved, would entitle them to declaratory relief, we must determine if those allegations are legally sufficient to establish the existence of a justiciable controversy. Hays v. Dept. of Corrections , 280 Or. App. 173, 174, 380 P.3d 1159 (2016) ; Bishop v. KC Development Group, LLC , 300 Or. App. 584, 590, 453 P.3d 613 (2019) (recognizing that a moot claim does not present a justiciable controversy for purposes of declaratory relief). To determine whether plaintiffs stated a claim for injunctive relief, we must determine whether plaintiffs "pleaded ultimate facts that would allow a finder of fact to determine that plaintiffs had no adequate remedy at law." Krein v. Szewc , 287 Or. App. 481, 486, 403 P.3d 520 (2017).

We first address whether the trial court lacked subject matter jurisdiction because the controversy between the parties was rendered moot when defendants allowed plaintiffs access to irrigation water. Generally, "a challenge becomes moot when a court decision will no longer have a practical effect on the rights of the parties." Fenimore v. Blachly-Lane County C.E.A. , 297 Or. App. 47, 62, 441 P.3d 699 (2019) (internal quotation marks omitted). One exception to that doctrine is that the " ‘mere voluntary cessation of a challenged practice in a context in which the practice may be resumed does not render a claim challenging that practice moot.’ " Id . (quoting Safeway, Inc. v. OPEU , 152 Or. App. 349, 357, 954 P.2d 196 (1998) ).

Defendants contend that the restoration of water flow to plaintiffs resolved the controversy because it was the "cessation of a finite three-month interruption of water flow combined with binding concessions and admissions" as to the existence and enforceability of the easement. Defendants further assert that the voluntary cessation exception is inapplicable because, once they learned of the easement, they entered into binding concessions that prevent them from rejecting its terms. See id . at 63, 441 P.3d 699 (voluntary cessation exception applies "only where the defendants maintain that they have a legal right to resume the challenged conduct and a court determines that a future dispute is likely") (emphasis in original).

However, there are no declarations, affidavits or "binding concessions" from defendants that they are, in fact, legally required to comply with the easement. The closest statement in the record is found in defendants’ motion to dismiss: that "after being made aware of the easement at issue, [defendants] did not controvert its existence or enforceability."¹ Defendants did not expressly state in their motion that the easement does in fact exist and apply to them, only that they are not contesting it in the face of litigation.

Additionally, according to the allegations in the complaint and plaintiffs’ declarations, defendants had complied with the terms of the easement for multiple...