Justia Real Estate & Property Law Opinion Summaries

Charley Johnson, trustee of the Charley E. Johnson Revocable Living Trust, purchased approximately 21 acres of land bordering the Tonto National Forest in Gila County, Arizona. Johnson later discovered that many of the improvements on the land, including a house, barn, well, and corrals, were actually on National Forest Service (NFS) land due to an erroneous survey. To resolve this, Johnson filed an application under the Small Tracts Act (STA) to purchase the encroached land. The U.S. Forest Service eventually sold Johnson a 0.59-acre parcel that included the house, barn, and well but excluded the corrals, claiming they were authorized range improvements owned by the United States.The United States District Court for the District of Arizona granted summary judgment in favor of the United States, holding that the Forest Service's decision to exclude the corrals was not subject to judicial review under the Administrative Procedure Act (APA) because it was committed to agency discretion by law. The court also found that the Forest Service's reliance on an appraisal valuing the 0.59-acre parcel at $27,000 was not arbitrary or capricious.The United States Court of Appeals for the Ninth Circuit reversed the district court's decision. The Ninth Circuit held that the APA's narrow exception for actions committed to agency discretion did not apply to discretionary conveyances under the STA. The court found that the STA and its regulations provide meaningful standards for evaluating the Forest Service's decisions, making them subject to judicial review. The Ninth Circuit remanded the case to the district court to determine whether the Forest Service's decision to exclude the corrals from the STA sale was arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law. View "JOHNSON V. USA" on Justia Law

John Schutt, as an agent for the J.E. Schutt & M.A. Schutt Family Trust, leased a residential property to Sherri Foster. Foster agreed to pay $1,900 per month in rent, with a late charge of $20 per day for any rent paid after the due date. Foster missed rent payments for July, August, and September 2020. Schutt filed a forcible detainer petition seeking unpaid rent and late fees. Foster countersued for money owed for construction services she performed for Schutt. The district court found Foster owed Schutt $5,700 in unpaid rent and awarded Schutt $21,240 in late fees, calculated at $20 per day for 1,062 days. After offsetting judgments, the court ruled Schutt owed Foster $544.98.Foster appealed to the Kansas Court of Appeals, arguing for the first time that the late-fee provision was unconscionable. The Court of Appeals reached the merits of Foster's unconscionability claim, despite it not being raised in the district court, and concluded that the late fees were unconscionable under the Residential Landlord and Tenant Act. The panel reversed the district court's award of late fees exceeding $2,460, the amount due for the 123 days between Foster's first missed payment and the date she vacated the property.The Kansas Supreme Court reviewed the case. The court held that appellants must brief exceptions to the preservation rule in their opening brief, as required by Kansas Supreme Court Rule 6.02(a)(5). Foster failed to comply with this requirement, as she first invoked exceptions to the preservation rule in her reply brief. The court concluded that the Court of Appeals erred by relying on these exceptions to reach the merits of Foster's unconscionability claim. Consequently, the Kansas Supreme Court reversed the judgment of the Court of Appeals and vacated its opinion, affirming the district court's judgment. View "Schutt v. Foster " on Justia Law

Wells Fargo Bank filed a complaint against Astra Genstar Partnership, LLP, seeking a declaratory judgment related to a property purchased at a foreclosure sale. Wells Fargo requested a declaration that all previously held interests in the property, including Astra's interest, were terminated. Astra filed an answer opposing Wells Fargo's request. The district court granted Wells Fargo's motion for judgment on the pleadings, ruling that any interest Astra had in the property was terminated by the foreclosure sale and the redemption period's expiration. The court administrator failed to notify the parties of the judgment immediately.The district court entered judgment on December 28, 2023, but the parties did not receive notice until March 15, 2024, after the appeal deadline had passed. Astra appealed to the Minnesota Court of Appeals on May 13, 2024. The court of appeals dismissed the appeal, stating it was late under Minnesota Rule of Civil Appellate Procedure 104 and that Rule 14.01(c)(2) of the Minnesota General Rules of Practice for the District Courts did not apply to appellate courts.The Minnesota Supreme Court reviewed the case and concluded that Rule 14.01(c)(2) does not authorize appellate courts to reinstate a late appeal. However, the court determined that the interests of justice warranted reinstating the appeal because the court administrator failed to transmit notice of the judgment as required by Minnesota Rule of Civil Procedure 77.04. The Supreme Court reversed the court of appeals' decision and reinstated Astra's appeal, emphasizing the need to avoid setting a trap for the unwary and to preserve the right to appeal. View "Wells Fargo Bank v. True Gravity Ventures, LLC" on Justia Law

Mary Bennett owns a farm on the U.S.–Mexico border. In 2008, the United States built a segment of the border wall on a portion of her property where it had an easement. In 2020, the government initiated a condemnation action to take that portion of the land and surrounding areas to further build the wall and make related improvements. Bennett argued that the government exceeded the scope of its easement when it built the wall, claiming ownership of the wall and seeking just compensation for its value. She attempted to present expert testimony on the wall's value, which the district court excluded.The United States District Court for the Southern District of Texas excluded Bennett's expert testimony, concluding that she was not entitled to just compensation for the wall's value. The court interpreted the common-law rule from Searl v. School-Dist. No. 2, which states that fixtures built by a trespasser become part of the estate, to include an exception for trespassers with an objective, good-faith belief in their right to build. The court found that the government had such a belief and thus precluded Bennett from recovering the wall's value. Bennett appealed this decision.The United States Court of Appeals for the Fifth Circuit reviewed the case. The court held that the government acted under its power of eminent domain, which cannot be limited by state trespass laws. The court affirmed that Bennett is entitled to compensation for the land taken but not for the value of the wall, as the government built it at its own expense for a public purpose. The court affirmed the district court's exclusion of the expert testimony and remanded the case for further proceedings consistent with this opinion. View "United States v. Bennett" on Justia Law

Rodney Alexander and Steve Hobart entered into an agreement granting Alexander a right of first refusal to purchase Steve’s cattle and to have Steve’s national forest livestock grazing permit transferred to him. An addendum later clarified that the agreement extended to Steve’s son, Nick. Years later, Nick sold the cattle and transferred the permit to a third party without notifying Alexander, who then sued for breach of contract and fraud. The defendants moved for judgment on the pleadings, arguing the contract was void due to impossibility of performance or because it was for an unlawful object, and that the right of first refusal was an unreasonable restraint on property alienation.The Circuit Court of the Seventh Judicial Circuit, Pennington County, South Dakota, granted the motion, ruling the contract void for impossibility of performance. Alexander appealed, asserting the court erred in its conclusion. Nick, through notice of review, sought to challenge the court’s ruling that the right of first refusal was not an unreasonable restraint on alienation.The Supreme Court of the State of South Dakota reviewed the case de novo. It found that the contract did not require the Hobarts to transfer the permit directly, but rather that the purchase was contingent on the USFS transferring the permit to Alexander. The court concluded that the contract was not void for impossibility of performance. Additionally, the court affirmed the lower court’s ruling that the right of first refusal was not an unreasonable restraint on alienation, considering the purpose, price, and duration of the agreement, and the mutual consent of the parties.The Supreme Court reversed the circuit court’s order and judgment, remanding the case for further proceedings. View "Alexander v. Estate Of Hobart" on Justia Law

The Vinales family leased a home at Randolph Air Force Base, managed by AETC II Privatized Housing, LLC, and other associated entities. They experienced issues with the home's condition, including mold and asbestos, which they claimed led to health problems and property damage. They sued the housing providers for breach of contract, fraud, and other claims, seeking damages and attorneys' fees.The United States District Court for the Western District of Texas granted summary judgment for the defendants on most claims, citing the federal enclave doctrine, which limits applicable law to federal law and pre-cession state law. The court dismissed the fraud claim for lack of evidence and denied the plaintiffs' motion for attorneys' fees. The breach of contract claim proceeded to trial, where the jury awarded the plaintiffs over $90,000 in damages. The magistrate judge denied the plaintiffs' motion for attorneys' fees and the defendants' motion for judgment as a matter of law.The United States Court of Appeals for the Fifth Circuit reviewed the case. The court affirmed the application of the federal enclave doctrine, which barred most of the plaintiffs' claims. It upheld the dismissal of the fraud claim, agreeing that the plaintiffs failed to identify actionable fraudulent statements. The court also affirmed the denial of attorneys' fees, finding no legal basis for the award. The exclusion of certain evidence at trial was deemed not to be an abuse of discretion. The court found sufficient evidence to support the jury's damages awards for personal property and diminution in rental value. Finally, the court held that the jury instructions were proper and did not create substantial doubt about the jury's guidance. The judgment of the magistrate judge was affirmed. View "Vinales v. AETC II Privatized Housing, LLC" on Justia Law

R&R Mountain Escapes, LLC ("R&R") purchased a property in a subdivision near Whitefish, Montana, and began using it for short-term rentals through a vacation rental company. The neighbors, Rodney and Heather Brandt, Marshall and Neva Fladager, and Larry and Rena Lautaret, filed a lawsuit claiming that R&R's short-term rentals violated the subdivision's restrictive covenants, which were designed to maintain the area for "country residential living" and prohibited commercial use. The neighbors sought to enjoin R&R's short-term rentals and requested attorney fees.The Eleventh Judicial District Court in Flathead County granted summary judgment in favor of the neighbors, holding that the restrictive covenants prohibited R&R's short-term rentals. However, the court denied the neighbors' request for attorney fees, reasoning that the covenants were ambiguous and it would not be just to penalize R&R with an award of fees. R&R appealed the decision barring short-term rentals, and the neighbors cross-appealed the denial of attorney fees.The Supreme Court of the State of Montana reviewed the case and affirmed the District Court's decision. The Supreme Court held that the restrictive covenants, when considered as a whole, unambiguously prohibited short-term rentals. The covenants were intended to promote "country residential living" and explicitly prohibited any commercial use, including short-term rentals that created nuisances for other homeowners. The court also affirmed the District Court's denial of attorney fees, concluding that the lower court did not abuse its discretion in finding that it would be unfair to penalize a party for litigating potentially ambiguous covenants. View "Brandt v. R&R Mountain Escapes, LLC" on Justia Law

In this residential landlord-tenant dispute, the tenants, Michael Gogal and Hildy Baumgartner-Gogal, entered into a lease with landlords, Xinhui Deng and Jianhua Wu. The lease included a clause that capped recoverable litigation costs and attorney’s fees at $1,000. After successfully suing the landlords for retaliatory eviction, the tenants were awarded a monetary judgment and attorney’s fees exceeding the $1,000 cap. They then sought to recover additional litigation costs under California Code of Civil Procedure section 1032(b). The landlords argued that the lease’s $1,000 cap barred any further cost recovery.The Superior Court of San Diego County initially ruled in favor of the landlords, enforcing the $1,000 cap. However, after further arguments from the tenants, the court reversed its decision, allowing the tenants to recover nearly $14,000 in costs. The court reasoned that enforcing the cap would contravene the public policy intent of California Civil Code section 1942.5, which aims to protect tenants from abusive landlord conduct.The California Court of Appeal, Fourth Appellate District, reviewed the case. The main issue was whether parties to a contract could waive their statutory right to recover litigation costs under section 1032(b) through a pre-dispute agreement. The appellate court concluded that section 1032(b) establishes a default rule allowing prevailing parties to recover costs but does not prohibit parties from waiving this right by agreement. The court found that such waivers are consistent with Civil Code section 3513, which allows the waiver of rights intended for private benefit. The appellate court reversed the lower court’s order, directing it to strike the tenants’ memorandum of costs, thereby enforcing the $1,000 cap stipulated in the lease. View "Gogal v. Deng" on Justia Law

Jonathan and Angela McOmber purchased a home from Shane and Keri Thompson. After the purchase, the McOmbers discovered significant issues with the property, including dry rot, mold, and water damage, which were not anticipated. They also found that the roof leaked and was not professionally installed, and that the previous owner had rewired parts of the kitchen improperly. The McOmbers relied on the sellers’ disclosures, which indicated that a drainage problem had been fixed and that there were no current mold issues or roof leaks. The McOmbers did not conduct an independent property inspection.The McOmbers filed a lawsuit against the Thompsons for breach of duty to disclose/fraud, common law fraud, and breach of contract, among other claims. The district court dismissed Angela McOmber from two of the claims and denied the McOmbers’ motion to add a claim for constructive trust. The district court granted summary judgment in favor of the Thompsons, finding that they had complied with the Property Condition Disclosure Act by disclosing known defects. The court also awarded attorney fees to the Thompsons based on a provision in the Real Estate Purchase and Sale Agreement (REPSA). The McOmbers’ motion for reconsideration was denied.The Supreme Court of Idaho reviewed the case and affirmed the district court’s decisions in part, reversed in part, and remanded. The court held that the Thompsons complied with the disclosure requirements and that the McOmbers failed to raise a genuine dispute of material fact regarding the falsity of the Thompsons’ statements. The court also found that the district court did not err in denying the motion to amend the complaint or the motion for reconsideration. However, the court reversed the award of attorney fees against Angela McOmber, as she was not a party to the REPSA, and remanded for the district court to issue an amended judgment. Neither party was awarded attorney fees on appeal. View "McOmber v. Thompson" on Justia Law

Tenants Michael Gogal and Hildy Baumgartner-Gogal, a married couple, prevailed on a retaliatory eviction claim against their former landlords, Xinhui Deng and Jianhua Wu. Michael, a licensed attorney, represented the tenants for most of the lawsuit. Post-judgment, the tenants sought to recover half of Michael’s attorney’s fees, attributing them to his representation of Hildy. Despite declarations from the tenants indicating that Hildy believed she had retained Michael as her attorney, the trial court denied the request, applying the precedent set in Gorman v. Tassajara Development Corp., which held that fees are not awardable when spouses’ interests are joint and indivisible.The Superior Court of San Diego County ruled in favor of the tenants on their retaliatory eviction claim, awarding them compensatory and punitive damages. The court also ruled in their favor on most other claims and on the landlords’ cross-claims, resulting in a total judgment against the landlords. Subsequently, the tenants filed a motion to recover attorney’s fees under Civil Code section 1942.5, which mandates an award of reasonable attorney’s fees to the prevailing party in retaliatory eviction cases. The trial court granted the motion for fees billed by another attorney but denied it for Michael’s fees, citing the Gorman case.The Court of Appeal, Fourth Appellate District, Division One, State of California, affirmed the trial court’s decision. The appellate court agreed with the trial court’s application of Gorman but emphasized the need for a nuanced analysis to determine whether a true attorney-client relationship existed between Hildy and Michael. The court concluded that the tenants failed to present sufficient evidence to establish such a relationship, as the record did not demonstrate that Hildy played a significant substantive role in the litigation or that her consultations with Michael were for the purpose of obtaining legal advice in his professional capacity. View "Gogal v. Deng" on Justia Law