Peter Bay Homeowners Ass'n v. Stillman

Citations: 294 F.3d 524; 2002 U.S. App. LEXIS 12755; 2002 WL 1390133Docket: Nos. 01-3726, 01-3727, 01-3728

Court: Court of Appeals for the Third Circuit; June 27, 2002; Federal Appellate Court

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The appeal involves the interpretation of an easement across beachfront properties in Peter Bay, St. John, Virgin Islands, stemming from a 1975 District Court opinion. The primary issue is whether the easement for three parcels—1, 2A, and 10A—extends from the low water shoreline to 50 feet inland or just to the vegetation berm. The Peter Bay Owners Association initiated the suit against several property owners regarding obligations from the earlier ruling, with most issues resolved except for the easement. In a 2001 ruling, the District Court determined that the easement for the relevant parcels extends only to the vegetation berm.

The appellants include the Association, James and Carol Henry (Parcel 2B), Robert Blakeney II (Parcel 3), and Andrews St. Johns Trust (Parcel 13A). The appellees are Ethlyn Hall (Parcel 16), Andrew and Joy Stillman (Parcel 10A), Antonio and Bonnie Godinez (Parcel 2A), and Michael Burgamy (Parcel 1). The court clarified that only certain parties were affected by the August 2001 order, and it did not address the claims of other intervenors.

The court concluded that the Protective Covenants establish a 50-foot easement for Parcels 1 and 2A, while Parcel 10A is limited to a berm line easement due to its direct transfer from the Harthman heirs, exempting it from the Protective Covenants. Ethlyn Hall's easement is unaffected by the ruling as she is an original Harthman heir with an easement to the vegetation berm.

Andrews Trust property (Parcel 13A) is not subject to the District Court’s August 2001 order, but it is governed by the 50' easement established in the July 1999 opinion, as no motion for reconsideration was filed. Parcel 13A is also bound by Protective Covenants. Similarly, Henrys’ Parcel 2B is subject to the 50' easement (and occasionally a 55' easement) in the Protective Covenants but is not reviewed in the August 2001 order. Blakeney’s Parcel 3, acquired from Andrews Trust under the Protective Covenants, is also unaffected by the August 2001 order, primarily due to its lack of beach frontage.

The litigation's history began in 1970 when Lillian Harthman Cheng sued to partition 50.82 acres of land inherited by six heirs. U.S. District Court Judge Warren Young presided over the case, resulting in a 1975 order that divided the land into 17 parcels, assigning values based on features, particularly beachfront proximity. The court ordered easements across beachfront properties to ensure access for all owners of non-beachfront parcels, establishing a 50' beach easement from the water’s edge for mutual use among property owners, with maintenance obligations included in the easement agreement. The specific distribution of parcels, including beachfront Parcel 16 received by Ethlyn Hall, is not pertinent to this appeal.

Judge Young mandated Virgin Islands Engineering and Surveying to conduct a survey and mapping of Peter Bay as per his directives. Joseph Brennan, the company's owner, developed two maps for the Harthman plan, specifically PWD File No. D9-1330-T77 for the beachfront area and PWD File No. D9-1331-T77 for the non-beachfront area, collectively known as the “1977 maps,” which delineate a 50-foot easement line across the beachfront properties. Following the Harthman decision, ownership of various Peter Bay parcels changed hands, categorizing owners into two groups: Ethlyn Hall, an original heir maintaining ownership of Parcel 16 since 1975, and other owners who acquired their parcels from Harthman heirs post-decision. 

The second group includes the Stillmans, who obtained Parcel 10A directly from Harthman heirs, and the Godinezes, Burgamy, Henrys, Blakeney, and Andrews Trust, who purchased from St. John Land Investment L.P. (the “Partnership”). The Partnership acquired Parcels 1-9 from Harthman heirs in 1986, referencing the 1977 maps and Harthman decision, and later bought Parcel 13A. They subsequently subdivided properties, made improvements, and established a “Declaration of Protective Covenants for the Partnership Property” (the “Protective Covenants”), which imposed obligations on the property and defined a 50-foot easement across the beachfront.

The Partnership sold various parcels, including Parcel 2A to Danzler Lumber Export Co. in 1988, which incorporated the Protective Covenants and 1988 map. Danzler later transferred Parcel 2A to Antonio and Bonnie Godinez in 1993, with the deed referencing the previous Warranty Deed. The chain of title for Parcel 1 is less clear, but Michael Burgamy acknowledges its subjectivity to the Protective Covenants after purchasing from Paul and Genevieve Due. The Partnership also sold Parcel 2B to Bernard Kramer, who passed it to the Henrys, and sold Parcels 13 and 3 to Andrews Trust, the latter of which sold Parcel 3 to Blakeney. All parties involved in the appeal, including the Henrys, Blakeney, and Andrews Trust, recognize that their parcels are governed by the Protective Covenants, which establish consistent rights, conditions, and restrictions for the subdivision parcels.

In 1997, the Association filed a lawsuit in the District Court against the Stillmans, John Catts, and Sheila Roebuck to collect dues and seek a declaratory judgment related to certain deed restrictions from the Harthman case. The Godinezes intervened, along with the Stillmans, to clarify the scope of an easement affecting their properties. Hall and the Dues later joined the case, collectively filing motions for summary judgment to affirm a berm line easement on their properties. The District Court mandated that any interested parties wishing to intervene had to do so by May 1, 1998, or accept the case's outcome. Additional property owners, including the Henrys and Andrews Trust, successfully moved to intervene.

The Association subsequently sought a summary judgment for a universal 50-foot beachfront easement for Peter Bay properties, while the interveners contended that claims related to a berm-line easement were barred by the statute of limitations. On October 26, 1998, the District Court denied the statute of limitations argument and scheduled a bench trial for that issue, reserving judgment on other motions. 

On July 8, 1999, the District Court determined that the berm line arguments were not time-barred and issued findings of fact. It ruled that the Harthman decision established an easement extending only to the vegetation berm line for Hall’s Parcel 16, which was connected to that ruling. For other properties obtained later and not part of the Harthman decision, the court affirmed a 50-foot easement based on deed references to corresponding maps. The court ordered that certain parcels of Peter Bay were subject to a 50-foot easement from the 1975 low water mark, while Parcel 16 was subject to the berm line easement. 

Subsequently, the Stillmans, Godinezes, and Dues sought reconsideration. On July 12, 2000, the District Court acknowledged its error for not applying the Restatement (Third) of Servitudes in its prior ruling, per 1 V.I.C. 4, and granted reconsideration, requesting supplemental briefs.

The District Court affirmed its subject matter jurisdiction regarding the beachfront easement in a ruling on July 17, 2000, amidst a challenge from the Stillmans. On August 22, 2001, it vacated parts of its prior July 1999 decision, extending the beach easement to the vegetation berm for the Stillmans, Godinezes, and Dues, based on the intent of the parties rather than the deed’s express boundaries, referencing § 4.1 of the Restatement (Third) of Property (Servitudes). The court found that the original misinterpretation of the Harthman decision led to the erroneous establishment of a 50-foot easement rather than a berm line easement. Consequently, the court ordered the 1999 decision vacated regarding parcels 1, 2A, and 10A of Peter Bay, now subject to an easement from the 1975 low-water mark to the vegetation berm line, as articulated in the 1975 Partitioning Decrees. The ruling specifically addressed only the parcels owned by the Dues, Godinezes, and Stillmans, leaving the original decision concerning Hall’s Parcel (16) unchanged. The court also noted that Parcel 13A, owned by Andrews Trust, retains a 50-foot easement since no reconsideration motion was filed. The District Court did not address the Protective Covenants that dictate a 50-foot easement for certain property owners. On August 23, 2001, the court substituted Burgamy as the Dues' successor-in-interest for Parcel 1. Appeals challenging the August 22, 2001 decision were filed by the Association, Henrys, Blakeney, and Andrews Trust. The Henrys and Blakeney's motion for reconsideration was denied as untimely. The appeal focuses solely on the scope of the easement across Parcels 1, 2A, and 10A, while the easements for Andrews Trust (Parcel 13A) and Hall (Parcel 16), as well as those for Henrys (Parcel 2B) and Blakeney (Parcel 3), are not contested.

The Court reviews the District Court's August 2001 summary judgment grant de novo, assessing if the record supports that no genuine issue of material fact exists, thus entitling the movant to judgment as a matter of law. Legal determinations, including those regarding jurisdiction, are also reviewed de novo. The Henrys, Blakeney, and Andrews Trust argue the District Court lacked subject matter jurisdiction to address issues beyond the interpretation of the 1975 Harthman decision, claiming the August 2001 judgment should be vacated. The Court disagrees, highlighting that the District Court had exercised subject matter jurisdiction over the partition action in 1975 under the Revised Organic Act, which granted general jurisdiction to the District Court of the Virgin Islands. Although the Act was amended in 1984 to allow the Virgin Islands legislature to assign jurisdiction over local actions to local courts, the District Court retained the jurisdiction to interpret the easement from the 1975 decision, as it is inherent for a court to manage its proceedings and enforce its decrees. The Court explicitly states it had jurisdiction to interpret obligations imposed on the Peter Bay properties by the 1975 District Court ruling. Additionally, the Court considers whether it had jurisdiction to determine the easement's scope for non-parties to the Harthman decision, referencing 28 U.S.C. § 1367, which allows federal courts to exercise supplemental jurisdiction over related claims in cases within their original jurisdiction, thus permitting the District Court to address these related matters.

Supplemental jurisdiction applies to claims involving additional parties, as confirmed by the court. The overlap between the interpretation of the 1975 Harthman decision and the beachfront easement across non-Harthman properties supports the existence of supplemental jurisdiction. The properties in question were the same as those addressed in the 1975 case, and their ownership has changed without altering the parcels themselves. The Harthman decision modified the boundaries and obligations of these properties, necessitating an understanding of the original restrictions to establish current encumbrances. For instance, if a 50-foot easement was ordered by Judge Young, property owners could not convey rights beyond their ownership, affecting the feasibility of a berm line easement.

Most relevant deeds reference the Harthman decision, making its interpretation crucial for defining the easement's boundaries. The claims are intertwined with significant factual elements related to the Harthman decision, satisfying the "same case or controversy" requirement. Claims are considered part of the same controversy if they revolve around a central fact pattern. Ancillary jurisdiction allows a federal court to address related matters while exercising primary jurisdiction. The court has discretion in deciding to exercise supplemental jurisdiction, and there is no evidence that the District Court abused its discretion in this case. Consequently, the District Court had subject matter jurisdiction over the issues in its August 2001 Opinion. The appellants argue that the District Court incorrectly determined that the Stillmans, Godinezes, and Burgamy properties were only subject to a berm line easement, requiring an examination of the 1975 Harthman opinion and subsequent property transfers.

The 1975 Harthman opinion established the boundaries of the properties involved in the current appeal, specifically addressing the size of beachfront easements. Judge Young's analysis is divided into two segments: the Commissioners' recommendations for the easements and the court's final order regarding the easements. 

The Commissioners recommended a perpetual beachfront easement of 50 feet wide along the water's edge to ensure access to the beach. They also proposed a pedestrian right-of-way from the public road to the beach and a mutual easement extending 50 feet inland from the water's edge. In response to whether restrictive covenants should be implemented for land development on the Peter Farm, Judge Young concluded that despite the Commissioners dividing the beach into six parcels, the beachfront area must remain accessible to all owners in line with the Virgin Islands Open Shorelines Act. He emphasized that no obstructions should be placed within the shorelines, which are defined as extending 50 feet inland or to the natural vegetation boundary, whichever is shorter.

Judge Young ruled that a beach easement should extend from the water's edge to the berm line, approximately 50 feet inland, on specified parcels, with the boundary of one parcel adjusted closer to the rocky shore. The ruling aligns with local laws promoting unobstructed use of Virgin Islands shorelines and aims to maximize the limited usable beachfront of over 50 acres.

Owners of parcels in Estate Peter Farm, St. John, possess a perpetual easement for the use and enjoyment of the beach area approximately 50 feet inland from the low water mark, except for a partial exclusion on Parcel 3. The court interpreted Judge Young’s ruling to limit the easement to the vegetation berm, despite the Commissioners' recommendation for a broader 50-foot easement. The court's reference to the "berm line" establishes a clear boundary, supported by the Virgin Islands Open Shoreline Act, which favors a shorter easement distance. Consequently, the Harthman opinion from 1975 recognized a berm line easement across the beachfront properties, except for Parcel 3, now owned by Blakeney. 

Further evaluation is necessary for parcels belonging to non-Harthman heirs, such as the Stillmans (Parcel 10A), Godinezes (Parcel 2A), and Burgamy (Parcel 1), to ascertain if subsequent transfers imposed greater easement obligations than those defined by the Harthman decision. In the absence of conflicting local law, the Virgin Islands courts will apply the Restatement (Third) of the Law of Servitudes as authoritative. This framework dictates that the scope of an easement should reflect the intent of the transferring parties, barring any public policy violations. The interpretation of servitudes must prioritize the parties' intentions while ensuring compliance with public policy, thus necessitating an examination of the original intent regarding any easement beyond the berm line established by the Harthman court.

The Stillmans acquired Parcel 10A through a Warranty Deed from John and Vernon Harthman on August 26, 1992, which explicitly subjected the property to existing easements, particularly a berm line easement established in the 1975 Harthman decision. The District Court's August 2001 ruling correctly affirmed that Parcel 10A is burdened only by this berm line easement, vacating an earlier 1999 order that had erroneously identified a 50' easement.

For the Godinezes and Burgamy, the District Court also determined that their parcels (2A and 1, respectively) were intended to have a berm line easement despite conflicting descriptions in various deeds. The court considered the chain of title but failed to fully analyze the implications of the Protective Covenants, which clearly apply to both parcels and establish a 50' easement. The Protective Covenants explicitly define "Common Areas" as those portions of Peter Bay reserved for the collective benefit of all owners, reinforcing the existence of the 50' easement across the affected properties.

The Declaration identifies the Common Areas, specifically noting a 50-foot beach easement as depicted in a 1988 map. It questions whether the Protective Covenants reflect the Partnership's intent to establish a broader easement than that determined by the Harthman decision. The District Court's August 2001 ruling indicated skepticism about the grantors' intention to extend easements for the benefit of Peter Farm owners without explicit articulation in the deed. However, the Protective Covenants are intended to impose greater restrictions than those permitted by law for the collective benefit of Peter Bay owners. 

The covenants aim to create uniform standards, rights, and restrictions for all parcels in the subdivision, binding future heirs and assigns. All deeds in Peter Bay must reference this Declaration, underscoring its binding nature. The Partnership's intent appears to contradict the District Court's findings, as it sought to impose additional restrictions for communal benefit. The Protective Covenants do not reference the 1975 Harthman decision or a berm line easement. Furthermore, it is confirmed that the parcels owned by the Godinezes and Burgamy are subject to these Covenants, as evidenced by the deeds, including a Warranty Deed from December 14, 1988, which affirms Parcel 2A's restrictions and easements tied to the Protective Covenants.

The later deed does not explicitly mention the Protective Covenants but incorporates a 1988 deed that does. Burgamy's parcel (Parcel 1) is subject to these Covenants, which explicitly cover it, despite the incomplete chain of title. Although the deed for Burgamy's property is not presented, it is assumed to reference the Protective Covenants, as all deeds in Peter Bay must include them by reference and citation. Burgamy provides no evidence to contest this. Consequently, the ruling from the District Court in August 2001, which stated that the properties owned by the Godinezes (Parcel 2A) and Burgamy (Parcel 1) are subject to a berm line easement, is reversed. Instead, it is determined that a 50' easement, as stipulated by the Protective Covenants, applies to these properties. The District Court's exercise of subject matter jurisdiction in this matter is affirmed, and the order regarding the Stillmans’ Parcel (Parcel 10A) being encumbered by a berm line easement is upheld. The document also notes a change in the parcel numbering system from 1977, which has led to further subdivisions. Blakeney's motion to be recognized as the real party in interest for Parcel 3 was granted, and arguments regarding jurisdiction by the Stillmans are not addressed since the Association supported the District Court's jurisdiction.

An obligation regarding a 1997 action by the Association aimed to enforce monetary responsibilities from the Harthman decision concerning the maintenance of Peter Bay roadways is no longer relevant. Blakeney's ownership of Parcel 3, transferred from Andrews Trust and the Partnership, is subject to the Association's Protective Covenants. Notably, Parcel 3 has minimal beachfront, thus not subject to an easement. The Stillmans, who own their property without additional encumbrances post-purchase, are not bound by the Protective Covenants, unlike the Godinezes (Parcel 2A) and Burgamy (Parcel 1). While the Stillmans and others argue that the Protective Covenants were improperly admitted into evidence, the record shows the issue was addressed in the District Court prior to its July 1999 Opinion. The Protective Covenants, which established a 50' easement, were included in the Association's cross-motion for summary judgment. The references made to the Harthman decision do not alter the conclusion regarding Parcel 2A's easement. Additionally, claims by the Godinezes and Burgamy that the appellants waived their arguments about the Protective Covenants by not raising them in opposition to a motion for reconsideration are unfounded, as the appellants did raise the issue in their cross-motions for summary judgment, and no supporting authority for their waiver argument has been cited.