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Incline Village Board of Trustees v. Edler

Court of Appeals of Missouri, Eastern District, Fourth Division

June 19, 2018

INCLINE VILLAGE BOARD OF TRUSTEES, Respondent,
v.
MATTHEW F. EDLER AND ANDREA EDLER, Appellants.

          Appeal from the Circuit Court of St. Charles County Cause No. 1211-CC00407 Honorable Daniel G. Pelikan F

          OPINION

          Colleen Dolan, P.J.

         Matthew F. Edler and Andrea Edler ("Appellants") appeal the trial court's judgment concluding that they did not have riparian rights to the artificial lake owned by the Incline Village Board of Trustees ("Respondent") that abutted Appellants' property. Appellants offer two points on appeal. In their first point, Appellants argue the trial court erred in concluding that they did not have riparian rights to the artificial lake. Specifically, Appellants assert that the trial court erred in concluding that the lake was still an artificial body of water; Appellants argue that the lake has become a natural body of water and that they have common law riparian rights to it. In Appellants' second point, they contend that the trial court abused its discretion in awarding attorney's fees to Respondent, specifically arguing that there were no equitable or special circumstances that supported the award.

         We affirm the declaratory judgment, but reverse the award of attorney's fees.

         I. Factual and Procedural History

         The Incline Village subdivision was developed in 1974. The developers dammed Indian Camp Creek to create a man-made lake (the "Main Lake") that was built for the recreational enjoyment of the Incline Village lot owners. The subdivision's Indenture of Trust and Restrictions of Incline Village ("the Indenture") established a board of trustees and created several restrictions on the use and development of the subdivision. Article II of the Indenture states that "[a]ll common areas and parks shall be ... dedicated to the exclusive use and benefit of the lot owners [of Incline Village]." The Main Lake, which is owned by and titled to Respondent, is one such common area dedicated to the exclusive use and benefit of Incline Village lot owners. The Indenture also establishes that only lake-abutting Incline Village lot owners may construct boat docks or slips, and may only do so with written permission by Respondent. Assessments paid by Incline Village lot owners are the sole source of funding for repairs and improvements to common areas, including the Main Lake. Pursuant to the Indenture, lot owners were initially required to pay only an assessment fee "not to exceed fifty dollars" (per lot) to maintain the Main Lake.

         In the years following the initial development of the Incline Village subdivision, the Main Lake began accumulating increasing amounts of silt-causing problems that could not be adequately addressed using only the assessment funds paid by the lot owners. In 1996, the Circuit Court of Warren County ordered the Incline Village lot owners to begin paying increased assessments of $415.00 per lot annually for five years to fund a dredging operation to remove the silt. The Circuit Court of Warren County reasoned that the restoration of the Main Lake was "unquestionably in the best interest of each and every member of the [Incline Village subdivision], in that each will benefit from the use and enjoyment of the lake and each will benefit from the prospect of increased property values." Additionally, the Circuit Court of Warren County ordered the lot owners to pay a separate $100.00 per year assessment to fund a "preventative and remedial maintenance program" over the life of the Main Lake. In the following decades, the Incline Village lot owners were ordered to pay increased assessment fees to repair and maintain the Main Lake. To date, Respondent has spent approximately $2, 864, 000.00 to repair and maintain the Main Lake since its creation; assessments paid by Incline Village lot owners were the sole source of the funds.

         Following the Circuit Court of Warren County's 1996 order, property adjacent to the Main Lake was purchased by Peter Lensenhuber and subsequently developed into the Sumac Ridge subdivision; the general warranty deed transferring ownership to Lensenhuber specifically excepted ownership of "Incline Village Lake, " and did not refer to riparian rights to the Main Lake. Appellants, who own non-lake-abutting lots in the Incline Village subdivision (and therefore cannot build a dock or slip on the Main Lake pursuant to the Indenture), purchased a lake-abutting lot in the Sumac Ridge subdivision (the "Sumac Ridge Lot") in 2009. The deed transferring ownership of the Sumac Ridge Lot to Appellants does not mention ownership of or riparian rights to the Main Lake. Nor did the Sumac Ridge subdivision plat or Sumac Ridge indenture reference rights of Sumac Ridge lot owners to use the Main Lake. Thus, Appellants owned two relevant properties: (1) the Main Lake-abutting Sumac Ridge Lot in which no contractual rights to the lake attached to its ownership; and (2) lots in the Incline Village subdivision that provided Appellants with contractual rights to use and enjoy the Main Lake, but afforded Appellants' no contractual rights to construct boat docks or slips on the Main Lake, as the properties did not abut the lake. Regarding whether they have a right to build a dock, Appellants rely solely on their ownership of the Sumac Ridge Lot under the theory that common law riparian rights attach to said property since the Main Lake has become a permanent, natural body of water; Appellants concede that their ownership of Incline Village property that is not Main Lake-abutting does not afford them rights to build a dock on it.

         After acquiring the Sumac Ridge Lot, Appellants sought to build a dock on the Main Lake despite not owning a lake-abutting Incline Village lot. Appellants built the dock on the Main Lake from the Sumac Ridge Lot, even though they did not have written permission by Respondent to build the dock, and were explicitly told by at least one Incline Village board member that they could not build it. Respondent filed its petition in the Circuit Court of St. Charles County on April 24, 2012, alleging that Appellants had trespassed and seeking a declaratory judgment to enjoin Appellants from continuing construction on or using the dock and to order Appellants to remove the dock and repair the Main Lake property to its previous state.

         After the parties filed their initial pleadings, the trial court granted Appellants' Motion for Summary Judgment, but subsequently granted Respondent's Motion to Reconsider and vacated its grant of summary judgment. A bench trial was held on September 8, 2016. Prior to trial, the parties jointly stipulated to several material facts (many of which have been mentioned previously), including, specifically, that the deed transferring ownership of the Sumac Ridge Lot to Appellants did not contain any language concerning the ownership of or rights to the Main Lake and that, pursuant to the Indenture, only owners of lake-abutting Incline Village lots may construct boat docks or slips on the Main Lake conditioned upon written permission from Respondent. On December 8, 2016, the trial court issued its Findings of Fact and Conclusions of Law and Judgment ordering Appellants to remove the dock, concluding that Appellants did not have the right to construct a dock on the Main Lake because "[t]he Main Lake is an artificial, man-made body of water created for the sole and exclusive use of Incline Village lot owners, " and that "[t]he Main Lake has not taken on the characteristics of a natural waterway and therefore [Appellants] have no riparian or littoral rights to own or use Main Lake." In addition to concluding that Appellants had violated the Indenture and committed trespass by erecting the dock without Respondent's permission, the trial court also awarded attorney's fees and costs in the amount of $75, 199.77 to Respondent pursuant to § 527.100, which allows a trial court to award costs as may seem equitable and just.[1] The trial court reasoned that an award of attorney's fees was appropriate because Appellants constructed the dock without having obtained Respondent's permission and after being told by one of Incline Village's board members that Appellants did not have the right to build the dock on Respondent's property.

         This appeal follows.

         II. Discussion

         Point I

         In Appellants' first point, they argue the trial court erred in concluding that they do not have riparian rights to the Main Lake because the Main Lake has become a permanent and natural body of water. Appellants further assert that they have common law riparian rights ...


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