A trespass by way of encroachment occurs when a building, structure, or other “thing” (as opposed to person or animal), goes beyond the boundaries of the owner’s land onto adjoining land without the permission or consent of the adjoining landowner.
With respect to many business and real estate disputes, there are specific, defined remedies that are available to a plaintiff; however, in the context of encroachments, courts have broad discretion to choose among many available remedies to best address the harm from the encroachment.
These unique powers were on display in a recent case from the First District Court of Appeal, Johnson v. Little Rock Ranch, LLC (2022) 73 Cal. App. 5th 576.
Facts of Johnson v. Little Rock Ranch, LLC
The case focuses on a dispute over the boundary between two adjoining parcels of land—a 677-acre parcel and a 210-acre parcel adjacent to, and to the south of, the northern parcel. For more than 50 years, a barbed wire fence has more or less separated the two parcels, but the actual property line lies about 50 feet to the north of the fence (the fence lies entirely on the southern parcel).
Prior to 2012, the two parcels were owned for many decades by members of the same extended family, with the Roens owning the northern parcel and the Johnsons owning the southern parcel. The Roens used their parcel primarily for cattle grazing and would allow their cattle to graze up to the fence, including the portion near the fence owned by the Johnsons. The Roens and Johnsons knew that the property line was inconsistent with the fence line and the Roens encouraged the Johnsons to obtain a survey and move the fence, which they never did. In 1997, the Johnsons leased their parcel to a farmer who planted an almond orchard on the entire parcel up to the fence, but did not utilize the strip of land north of the fence. The Johnsons only occasionally visited their parcel and did not utilize the unused strip of land other than for infrequent hunting trips.
In 2012, the Roens sold their parcel to Little Rock Ranch, LLC, acting through its principal Raymond Greer. None of the Roens or their agent notified Greer of the discrepancy between the property line and the fence line, but in fact led Greer to believe that the fence line marked the property line. Of note, the title report did disclose that there may be discrepancies between the property line and fence line, but did not provide specifics. The Roens’ agent led Greer to believe that the discrepancies identified in the title report likely reflected small, one or two foot, discrepancies between the property line and fence line, and Greer assumed that was true.
Within two months of acquiring the property, Greer spent well over a million dollars preparing the land to plant a walnut orchard, including significant costs grading the dirt around the fence line, which was technically owned by the Johnsons. Four months later, after Greer had incurred significant costs, the Johnsons notified Greer that they owned approximately 3.4 acres of the property beyond the fence line, which had now been leveled and graded.
The Johnsons then sued Little Rock Ranch to quiet title to the disputed strip of land and also for trespass, including a request for injunctive relief requiring Little Rock to undo the work that had been done and return the land back to its form prior to Little Rock Ranch purchasing the property.
The Court of Appeal affirmed the trial court’s ruling in full and blessed the trial court’s consideration of the various available remedies.
The trial court first considered the Johnsons’ request for injunctive relief and denied the injunction on two grounds. First, the court determined that the defense of laches (unreasonable delay) barred the request. Over the course of multiple decades, the Johnsons took no action to address the discrepancy between the property line and fence line, then waited 6 months after Little Rock began improving the land to alert Little Rock to the issue.
Second, the court applied the “relative hardship” doctrine which requires the court to balance the hardships between the parties and use its “broad equitable powers to fashion a remedy to fit the requirements of specific cases.” Applying the doctrine here in deciding whether an injunction was a proper remedy, the court sympathized with the fact that Little Rock had spent over a million dollars preparing the land to plant walnut trees that it thought it owned. Whereas the Johnsons had never used the land much, other than for infrequent recreational hunting, an injunction would require Little Rock to destroy planted trees, remove irrigation equipment, and restore dirt that had been leveled and graded—which would actually diminish the land value.
After rejecting the request for an injunction, the court next turned to various potential measures of damages. At the heart of this inquiry was whether the encroachment was considered “permanent.” The court determined that it was because it was not “economically feasible” to reverse the encroachment. Thus, damages could not be based on the cost of abating the encroachment.
Ultimately, the court settled on ordering the Johnsons to sell the disputed strip of land to Little Rock based on a per acre cost of the property calculated using the market value of the improved land (as opposed to the market value prior to Little Rock’s improvements).
Of note, even the appellate justices did not agree in this case on the best remedy among the many possible options. A dissenting justice argued in favor of holding Little Rock accountable for failing to investigate the disclosures in the title report and granting the Johnsons’ request for injunctive relief.
The trial court has broad discretion and authority to address disputes involving trespass by encroachment. Property owners can help guard their rights by both being aware of their boundary lines and protecting against any unauthorized uses or actions which could be seen as waiving those rights, particularly over a long period of time.