                                         NO.      95-094
                  IN THE SUPREME COURT OF THE STATE OF MONTANA
                                               1996



JACK R. TANNER and PATRICIA L. TANNER,
FREDERICK MCFARLAND, SHERRIE MCFARLAND,
and THOMAS J. FARRELL,
                 Plaintiffs,       Respondents,       and
                 Cross-Appellants,
         v.
DREAM ISLAND, INC.,             a Nevada    Corporation,
and JUANITA DALY,
                 Defendants,    Appellants,          and
                 Cross-Respondents.



APPEAL        FROM:     District  Court of the Twentieth   Judicial                 District,
                        In and for the County of .Lake~ ~-T,
                        The Honorable   Ed McLean, Judge presiding.


COUNSEL OF RECORD:
                 For   Appellants:
                        John M. Morrison,          Meloy     & Morrison,
                        Helena, Montana
                 For   Respondents:
                        James A. Manley,          Manley     Law Offices,
                        Poison, Montana


                                         Submitted         on Briefs:       January  25, 1996
                                                             Decided:       March 21, 1996
Filed:
Justice             Charles            E.     Erdmann            delivered                the       opinion             of        the     Court.
           Defendants                   appeal            from          jury          findings                  incorporated                       into          a

judgment,              order,            and permanent                       injunction                  issued         by the            Twentieth

Judicial             District                Court,           Lake      County.               The District                        Court        adopted
the      jury's         special               verdict            concerning                 disputed               road           easements                and

permanently                  enjoined                defendants                from         obstructing                  plaintiffs'                       use

and      enjoyment                of        the        easements.                 Plaintiffs                    cross-appeal                       on      the

issue         of     attorney                fees.            We affirm              in     part          and reverse                   in     part.

           The issues                  on appeal                are     as follows:

           1.         What         is        the       effect          of      the        District               Court's              injunction,

issued             during         the         trial,            which          prevented                  Daly         from           obstructing

plaintiffs'                 use        and enjoyment                    of      Indian            Boulevard?

           2.         Was there                    substantial                 credible                evidence              to       support              the

jury      verdict            which           found        road        easements              by grant,                 prescription,                       and

necessity?

           3.         Did         the          District               Court           err         in       instructing                       the          jury

regarding             prescriptive                      easements?

           4.         Did       the         District            Court         abuse         its        discretion                   in concluding

that      an equitable                      award        of     attorney              fees        was not           proper              for        either

party         in     this       case?

                                                                        FACTS

           The parties                  are       adjoining             landowners                  of     lake        front          property               on

Flathead             Lake.             The properties                       are      part         of      Lot     4,     Block            2,       of      the

Armo       Villa            townsite               near        the      town         of       Big        Arm.           When            the        United

States             government                platted            the      villa            sites           in      1910         it       reserved                 a
forty-foot               boulevard                 called             Indian           Boulevard                 between             the      lots      and
the      lake         shore.              This         boulevard,                   like      others             around            the     lake,        has

historically                   been          used         for         vehicular               and         foot          traffic.               In     some

places          the      boulevard               has been used by adjacent                                        lot        owners         as a lawn

area      or      for        cabin         sites          or      boat         houses.
          In      1932         Lot         4,     Block           2,      was          divided             in      half.              The      Mueller

Realty          Company               conveyed             the         north          half          to    Eugenia             Rochester                (who

also      owned          a nearby                island           named Dream                   Island)                and the           south        half

to     Harry            Mueller.                  Plaintiffs'                       title           derives              from         Mueller           and

defendants'                   title             derives               from           Rochester.                         The         indenture                to

Rochester               reserved:
           [Al right-of-way       for   road purposes      over      and upon the
          premises     herein  conveyed,     to Harry J. Mueller         of Butte,
          Montana,     and to his heirs     and assigns,       forever,    over and
          upon any and all          roads   now laid      out     and heretofore
          traveled      over  upon and across        said     premises,      or any
          portion    thereof.

The      transfer              of      the        south          half          of      Lot      4 to            Mueller             contained                an

identical               easement             reservation                  over              and upon             the       land       conveyed               to

Rochester.

          In      1959        Juanita              Daly          and her              late          husband,              Marcus           Daly       III,

purchased               the         north          half          of      Lot          4      and         Dream           Island            (the       Daly

property)              from         the     Kirks         who then                 owned the              Rochester                 property.                In

1964        the       Dalys            conveyed                 the      property               to        Dream            Island,            Inc.,           a

solely          owned         private             corporation.                         In     1965 Ross                 and Delores                  Young

purchased              the     south            half      of Lot          4 from              the        Boetchers              who then             owned

the      Mueller              property.                   The          Youngs               subdivided                 the         property           into



                                                                               3
three        smaller            lots.           These          sublots                were      purchased                   by plaintiffs'
predecessors                   and later              conveyed             to      plaintiffs                 for       summer               homes.

          In 1971 Jack                  and Patricia                 Tanner            purchased               the          sublot           adjacent

to the        Daly           property           (the        Tanner          property).                     In 1981 Frederick                          and
Sherrie          McFarland                purchased                  the         sublot          adjacent                    to        the       Tanner

property               (the           McFarland               property).                        In         1971          Thomas               Farrell

purchased              the      third          sublot          which            lies        adjacent              to        the        Tanner         and

McFarland              properties                 (the         Farrell                 property).                      In         1974        Farrell
conveyed          his         property           to     the         United            States          to be held                  in     trust        for

him     as a tribal                   member.

          The         Daly       property               lies         north             of      the         plaintiffs'                       property

except          for          a small          triangle               of      the        McFarland                property                    which       is

situated              north       of      the         Daly      property.                      The         Tanner             property               lies

adjacent          to and south                  of the          Daly        property.                     The McFarland                      property
lies      adjacent               to     and      south         of         the         Tanner          property.                    The        Farrell

property              lies       adjacent              to      and        southeast                  of      both           the        Tanner         and

McFarland             properties.                 The roads                 at        issue      are         designated                  as A,        Al,

A2,     B,    C, D, E,                F, and G.

          No witnesses                   were         found          who remembered                        the       property                 in     1932

but     two      nearby           landowners                 remembered                  the     property                   as     far        back       as

1934 or 1935.                   Sid      Walker         clearly             remembers                 that       the         Rochesters               and

others,          including               the      Tanners'                predecessors,                      used           roads            A and       G.

Red Tucker               bought          nearby          property                in     the     mid-1930s                    and identified

road      B as the              old      county             road.          He and other                      landowners                  used        road

A to      get         down       to     road      G on the                 boulevard.                     He testified                       that       the


                                                                           4
public,         as well           as the        parties'              predecessors,                    used        roads    A,       B,
and G.         Other testimony               established                that        prior       residents            used roads
A, G, and E.
          Tanner         testified          that      he has used roads                         A, A2,          D, E, and G.
Mrs.      McFarland          testified             that      she and her husband have used roads
A, B, F, and G and Farrell                           testified            that         he has used roads                    A, Al,
A2, and G.             The Tanners            and Farrells                testified              that         they    have used
the roads          for     over       twenty        years         and all           parties            stated        they    never
sought         permission            from      Daly        to     use the             roads,           as they          believed
permission             was not necessary.                    Although              Daly objects                to plaintiffs
using      road A across                  her property,               she admits                that         she uses road A
across         other      people's          property            without            their        permission.
          In     1989 Daly's               attorney             wrote         a letter             to        the     plaintiffs
acknowledging              that      plaintiffs            had an easement over her property                                      for
those      roads         which       were      in    existence                in     1932--roads               A and G--but
that      she intended               to rescind             her       alleged          permission               to use other
roads      running          across         her property.                  Daly         indicated               in her       letter
that      she intended            to install              a fence down the south                             boundary       of her

property,          thereby           blocking        use of roads                   B, C, and D.
          In    the       fall       of     1992,         after         the        plaintiffs                had left        their

property         for      the season,             Daly erected                a fence           around her property.
The fence          extended           nearly        to the water,                    cutting           off     access       to the
Farrell         property          and to McFarlands'                    lake front              property,             as well        as
to their          source         of water.            The fence               made access                    to the Tanners'
cabin      difficult             and cut Tanners                  off     from         their           boat        house,    dock,


                                                                  5
                                           NO.    95-094
                  IN THE SUPREME COURT OF THE STATE OF MONTANA
                                                 1996


JACK R. TANNER and PATRICIA L. TANNER,
FREDERICK MCFARLAND, SHERRIE MCFARLAND,
and THOMAS J. FARRELL,
                 Plaintiffs,       Respondents,         and
                 Cross-Appellants,
         v.
DREAM ISLAND, INC.,             a Nevada     Corporation,
and JUANITA DALY,
                 Defendants,    Appellants,         and
                 Cross-Respondents.



APPEAL        FROM:     District  Court of the Twentieth   Judicial                  District,
                        In and for the County of ~La'ke. -:,
                        The Honorable   Ed McLean, Judge presiding.


COUNSEL OF RECORD:
                 For   Appellants:
                        John M. Morrison,          Meloy      & Morrison,
                        Helena, Montana
                 For   Respondents:
                        James A. Manley,          Manley      Law Offices,
                        Poison, Montana


                                        Submitted          on Briefs:        January  25, 1996
                                                              Decided:       March 21, 1996
Filed:
Justice             Charles            E.     Erdmann            delivered                the      opinion             of        the     Court.

           Defendants                   appeal            from         jury         findings                  incorporated                         into          a

judgment,             order,            and permanent                      injunction                   issued        by the             Twentieth
Judicial             District                Court,           Lake      County.               The District                       Court         adopted
the     jury's          special               verdict            concerning                 disputed             road            easements                 and

permanently                 enjoined                 defendants               from         obstructing                  plaintiffs'                        use

and      enjoyment                of        the        easements.                  Plaintiffs                  cross-appeal                        on the

issue         of     attorney                fees.            We affirm             in      part         and reverse                    in     part.

           The       issues            on appeal                are     as follows:

           1.         What         is        the       effect         of      the         District             Court's             injunction,

issued             during         the         trial,            which          prevented                 Daly         from         obstructing

plaintiffs'                 use        and enjoyment                    of       Indian          Boulevard?
           2.         Was there                    substantial                credible                 evidence             to     support                 the

jury      verdict            which           found        road        easements              by grant,              prescription,                          and

necessity?

           3.         Did         the          District               Court          err          in      instructing                        the          jury

regarding             prescriptive                      easements?

           4.         Did the               District            Court        abuse         its         discretion                in concluding

that       an equitable                     award        of     attorney             fees         was not           proper              for        either

party         in     this       case?

                                                                        FACTS

           The parties                  are        adjoining            landowners                 of     lake        front            property              on

Flathead             Lake.             The properties                      are      part         of      Lot     4,     Block            2,        of      the

Armo       Villa            townsite               near         the     town         of      Big         Arm.          When the                    United

States             government                platted            the        villa          sites          in      1910         it        reserved                 a


                                                                             2
forty-foot               boulevard                  called            Indian          Boulevard                between            the     lots        and
the      lake         shore.               This         boulevard,                 like        others          around            the     lake,        has

historically                   been          used         for     vehicular                    and      foot          traffic.              In      some

places          the      boulevard                 has been used by adjacent                                    lot       owners         as a lawn

area      or      for         cabin         sites          or    boat         houses.

          In      1932          Lot         4,      Block         2,     was          divided            in      half.             The      Mueller

Realty          Company                conveyed            the        north          half        to     Eugenia              Rochester              (who

also      owned          a nearby                 island         named Dream                     Island)             and the            south       half

to     Harry            Mueller.                   Plaintiffs'                     title         derives               from        Mueller            and

defendants'                    title             derives              from          Rochester.                        The        indenture                 to

Rochester               reserved:

           [A] right-of-way      for   road purposes      over     and upon the
          premises     herein  conveyed,    to Harry J. Mueller        of Butte,
          Montana,     and to his heirs    and assigns,      forever,    over and
          upon any and all         roads   now laid      out and heretofore
          traveled      over  upon and across       said    premises,      or any
          portion    thereof.

The      transfer               of      the        south         half         of       Lot       4 to         Mueller             contained                an

identical               easement                 reservation              over             and upon            the       land          conveyed            to

Rochester.

          In      1959         Juanita              Daly         and her              late           husband,           Marcus           Daly       III,

purchased                the         north          half         of      Lot          4        and     Dream           Island            (the       Daly
property)               from         the     Kirks         who then            owned the                Rochester                property.                 In

1964        the         Dalys           conveyed                the     property                 to     Dream            Island,            Inc.,           a

solely          owned private                       corporation.                          In    1965 Ross              and Delores               Young

purchased               the      south           half      of Lot         4 from               the     Boetchers              who then           owned

the      Mueller               property.                   The         Youngs              subdivided                 the        property           into



                                                                               3
three         smaller              lots.              These          sublots               were      purchased                  by plaintiffs'
predecessors                     and later                  conveyed            to plaintiffs                     for        summer              homes.

             In 1971 Jack                     and Patricia                 Tanner           purchased              the       sublot              adjacent

to     the     Daly             property              (the        Tanner         property).                    In 1981            Frederick               and

Sherrie             McFarland                   purchased                 the         sublot          adjacent                  to         the       Tanner

property                  (the          McFarland                  property).                       In         1971          Thomas               Farrell
purchased                 the      third             sublot          which           lies        adjacent             to        the        Tanner         and

McFarland                  properties                   (the         Farrell                property).                     In         1974        Farrell
conveyed             his         property              to     the      United              States         to     be held              in     trust        for

him     as a tribal                      member.

          The            Daly       property                  lies         north            of      the        plaintiffs'                       property
except             for          a small             triangle              of     the         McFarland                property                   which      is

situated                 north       of         the         Daly       property.                    The        Tanner            property                lies

adjacent             to and south                     of     the     Daly        property.                    The McFarland                      property

lies         adjacent              to         and      south         of        the         Tanner         property.                    The        Farrell

property                 lies       adjacent                 to      and       southeast                 of      both           the        Tanner         and

McFarland                properties.                       The roads             at        issue     are         designated                  as A,        Al,

AZ,     B,     C, D, E,                  F,     and G.

          No witnesses                         were         found         who remembered                        the      property                 in     1932

but     two         nearby           landowners                    remembered                 the     property                  as     far        back      as

1934 or 1935.                      Sid        Walker          clearly            remembers                that        the        Rochesters               and

others,             including                  the     Tanners'                predecessors,                     used           roads            A and      G.

Red Tucker                  bought            nearby           property               in     the     mid-1930s                  and        identified

road         B as the              old        county           road.            He and other                     landowners                  used        road

A to         get         down      to         road      G on the                boulevard.                     Be testified                      that     the


                                                                                4
public,            as      well          as        the      parties'                 predecessors,                      used             roads         A,       B,
and G.            Other         testimony                 established                 that         prior          residents                    used     roads

A,     G, and E.

            Tanner            testified                  that         he has          used         roads          A,        A2,        D, E,          and G.

Mrs.        McFarland                 testified                 that         she and her                  husband                have       used        roads

A,     B,    F,     and G and Farrell                             testified              that            he has used                     roads        A,     Al,

A2,     and G.             The Tanners                     and Farrells                 testified                  that            they         have        used

the     roads           for       over         twenty            years         and all              parties             stated              they       never
sought            permission                  from         Daly          to     use         the       roads,                as     they            believed

permission                 was not            necessary.                     Although              Daly        objects              to plaintiffs
using        road          A across                her     property,                 she admits                  that            she uses             road         A

across           other         people's              property                 without             their          permission.

            In     1989          Daly's             attorney                  wrote          a     letter              to        the        plaintiffs

acknowledging                    that         plaintiffs                 had an easement                         over        her property                    for

those          roads          which           were         in      existence                 in      1932--roads                     A and            G--but

that        she      intended                 to     rescind             her        alleged              permission                    to      use     other

roads          running            across            her         property.                   Daly         indicated                  in      her       letter
that        she intended                     to install                a fence          down the               south             boundary              of her

property,               thereby              blocking              use of            roads          B,      C, and D.

            In     the         fall          of      1992,             after          the         plaintiffs                     had        left        their

property            for        the      season,             Daly         erected             a fence             around             her        property.

The       fence         extended               nearly            to     the         water,          cutting             off         access            to     the

Farrell           property              and to McFarlands'                             lake         front         property,                    as well          as

to     their         source             of     water.                  The     fence         made access                      to         the       Tanners'

cabin          difficult                and        cut      Tanners             off         from         their          boat           house,           dock,


                                                                                5
and barbecue       pit.       The    fence    was constructed                  of    iron     fence     posts
and chicken       wire     and the     east   end was nailed               to       the     Tanners'     boat
house.       When Mr.      Tanner     returned      to        the    property         in     May 1993,      he

hired    a crew    to     remove    the   section        of    the     fence        which     crossed     the

boulevard.
           In March           1993 the                Tanners            and McFarlands                     filed           a complaint                   in

District            Court            claiming             easements                 by     grant           and      prescription                       and

seeking          an injunction                       to prohibit                 Daly      from         obstructing                   the        use      of

their         property             or        their       egress            and ingress.                     Plaintiffs                 requested
a jury           trial        to         determine               compensatory,                    emotional                 distress,                  and

punitive            damages.                   In       September                1993      the      District                Court           granted

plaintiffs'                 motion              to      join         Farrell              as     a plaintiff                     who        alleged

easements                by grant,              prescription,                     and necessity.

           On June            13,            1994,       Daly         filed          a motion               for        partial              summary

judgment           on the          issues            of emotional                  distress,               compensatory                   damages,

and punitive                 damages.                   On July            20,       1994,        Daly         filed            a motion               for

partial          summary             judgment            on the            issue         of attorney                fees.            Plaintiffs

subsequently                 withdrew                 their          claim          for        emotional               distress               and       on

July       22,     1994,        the          District            Court           denied         Daly's           motion          for        summary

judgment            on      compensatory                       and       punitive              damages.                   The        claims            for

compensatory                 and             punitive            damages             went          to       trial           on        August              30

and 31,           1994.                 In     an       August           30,        1994,         opinion                and      order,               the

District           Court        concluded                as a matter                 of    law that               attorney             fees        were

not       available           to        either           party.
           During            trial              the           District              Court           issued                an         injunction

prohibiting                 Daly             from        blocking                 road         G which               sits            on          Indian

Boulevard.                  However,                  because              there          was      still            an       issue           of        the

reasonableness                  or           maliciousness                  of     Daly's          actions             in       erecting               the

fence         across         the         boulevard,                  the       District            Court            did        not      want           the

jury          contaminated                      or       Daly            prejudiced                 by        knowledge                     of         the
injunction.                        The       parties                   and      the          court            agreed          that         the       jury's
special            verdict             form        would              therefore                include          the     issue             of easements

over        road        G, even though                          that         issue        had already                  been decided                  by the

court        as a matter                     of       law.

            The jury               returned                a special                 verdict            for      the        plaintiffs               and on

September                 12,        1994,         the           District               Court           entered             its       judgment            and

order        incorporating                        the       jury         verdict.                The jury              determined                that     all

plaintiffs                had an easement                             by grant             over        roads       A, Al,            A2,      B, and G.

The jury             found            that        Tanner               had a prescriptive                             easement              over        roads

D,     E,    and G,                and that                McFarland                 had        a prescriptive                       easement            over

roads        E and              G.         In      addition,                   the        jury         found          that         Farrell              had     a
prescriptive                       easement                 over             road      G,        as      well          as      an         easement            by

necessity               over          roads           A,        Al,      and G.                The     jury       awarded               compensatory
damages            in        the      amount               of         $166.25          (costs            to     remove            the       fence)        and

determined                   that            no       punitive                  damages                should           be         awarded.                   On

November             2,         1994,           the         District                 Court           issued           its         final          opinion,

order,        and permanent                        injunction                       denying           the      defendants'                  motion        for

judgment                notwithstanding                                the          verdict             and       upholding                   the        jury

verdict.                This          appeal            and cross-appeal                              followed.

                                                                             ISSUE         1

            What        is      the       effect            of         the     District               Court's          injunction,                   issued

during        the         trial,          which             prevented                Daly        from         obstructing                 plaintiffs'

use      and enjoyment                       of       Indian             Boulevard?

            Ownership                of      Indian             Boulevard               is      a complex              issue         with        a number

of different                    parties,              including                 individual                  landowners,                 Lake       County,
the     Confederated               Salish          and Kootenai                 Tribes,         and the             United      States
government,              all      claiming             ownership              interest.             The plaintiffs                      did
not     allege        ownership              of the       boulevard             in their          complaint               and stated

that      resolution             of      that      issue           was beyond           the     scope          of    this      action.

Plaintiffs            instead            claimed          that       Daly       had no right                  to the        exclusive

use      of    road         G on the            boulevard            either           because       it        belonged          to      the

United         States          government           or,       if     Daly       did     own it,          it     was subject              to

easements.
          On the            second        day     of      trial,          and     out     of      the         presence          of      the

jury,         the    District            Court         concluded            as a matter             of        law     that:

          Until    such time as [Daly]       has acquired    a right      to [Indian
          Boulevard]       or permission      from a court     of jurisdiction,
          after     serving    notice    on the Tribe       and on the United
          States     Government,      and bringing    an action      with    them as
          parties,      she's  enjoined    from obstructing       [road G on the
          boulevard].

            In its      November             2,   1994,       opinion           and order,           the        District          Court

clarified            this       issue:

          As to road G, the Court has previously                        ruled,      as a matter
          of law,       that    ownership         of Indian         Boulevard         cannot    be
          decided       without       naming       the     relevant        native       american
          tribes     and the United            States       government.           However,       as
          between Plaintiffs            and Defendants,          the jury found that to
          the    extent      Defendants         claim       to have any interest                 in
          road G, there           is an easement              by grant         across     Indian
          Boulevard        in favor       of Plaintiffs           which      is enforceable
          against        the     Defendants'           claimed        interest.             Thus,
          Defendants          and      their       successors          in      interest        are
          permanently        enjoined       by the Court from obstructing                  in any
          way Plaintiffs'           use and enjoyment             of road G, no matter
          whom is ultimately               decided      to be the owner of Indian
          Boulevard.

          Daly       does not           appeal         the    issuance           of the         injunction                concerning

the      boulevard,               but        rather          limits           her       appeal           to         the       easement


                                                                      9
determinations.                    The       issuance            of     the     injunction                renders          the
easement          issues        as to road G moot.                      As noted            above,        the jury         was
purposely          made unaware               of    the        fact     that    the          District          Court       had
issued      an injunction            during         trial       concerning         Indian            Boulevard.            The
jury      therefore         addressed           the issue             of easements            over      road G during
its     deliberation.               Since         the issuance            of the injunction                    regarding
road      G is       not        before       us     and since            the    injunction                renders          the
easements         over the boulevard                    moot, we conclude                   that     a review           of the
jury      findings         pertaining           to easements on road G is unnecessary.
                                                        ISSUE 2
          Was there          substantial            credible            evidence            to support            the     jury
verdict          which      found        road      easements            by grant,             prescription,                and
necessity?
          We review         a jury's         verdict           to determine            if     it    is supported            by
substantial           credible            evidence.                 Barthule      v.        Karman         (1994),         268
Mont.      477,      485,       886 P.2d 971,               976 (citing         Interstate                Prod.     Credit
Ass'n      v.     DeSaye          (1991),          250 Mont.           320,     322-23,             820 P.2d            1285,
1287).           Substantial             evidence         is    defined        as that             evidence         that         a
reasonable           mind might            accept       as adequate            to support               a conclusion.
Head v.         Central         Reserve      Life        (1993),        256 Mont.            188,       201,      845 P.2d
735,      743.       Evidence        which         is    inherently            weak and conflicting                        may
still      be considered                 substantial.                 Head,     845 P.2d             at    743.          When
conflicting           evidence           exists,        the weight        and credibility                  given         to it
are within           the province            of the jury.               Whiting         v. State           (1991),         248
Mont.       207,         213,      810      P.2d        1177,          1181.           When determining                     if


                                                               10
substantial                evidence              exists,             this         Court         views       the     evidence                 in       the
light        most      favorable              to the         prevailing                   party.           Whitinq,              810        P.Zd          at

1181.

                                                     Easements                    bv Grant

           The jury           found         that      plaintiffs                    possessed              an easement                 by grant

over       roads       A, Al,          A2,        and B, based                     on the        1932 deed               transfers                  from

the     Mueller            Realty          Company           to        Eugenia          Rochester             and Harry                Mueller.

Daly       argues           on       appeal          that              (1)        she     was       a bona              fide       purchaser

without             knowledge               of       the           easements,                   and        (2)          there          was            not

sufficient             evidence             indicating                  that        the     above-mentioned                       roads             were

those        referenced               in     the      1932 deeds.

           Daly's          first           argument           fails               for     two      reasons.                The         deeds              in

question            which          refer      to     the      easements                 were       admitted              as plaintiffs'
exhibits             0CT, and              ,1 t1 at
                                            D               trial.                  The     exhibits,               on         their              face,
indicate            they     were          both     recorded                  in the       Lake County                  land      records                 on

October         19,        1932.           The parties                   stipulated                that      the        chain          of         title
documents             would           be     admitted                  into         evidence              without              foundational

testimony.                 Even though               Daly         argues            on appeal              that     the         deeds          bears

no signatures                or notary               seal,           Daly         did     not     object          when the             exhibits

were       admitted           into         evidence.                   She cannot                now be allowed                    to        refute

the     deeds'         authenticity                  as failure                    to   object          to the           issue         at         trial

precludes            her      from         raising           the         issue          on appeal.                 See Hando                 v.       PPG

Industries,                Inc.        (1995),             272 Mont.                146,         900 P.2d           281;         Bridger                  v.

Lake         (1995),          271          Mont.       186,             896        P.2d         406.          Furthermore,                          Daly

admitted            that      she was aware                       of     the       roads         across           her     property                  when


                                                                             11
she      and        her             husband            purchased               the         land,          thus       she         had       actual
knowledge                of     the          roads       and      therefore                cannot           now claim               bona       fide

purchaser            status.

         With            respect             to      Daly's        second            argument,              she      is     correct            that

there        is    no direct                  evidence           that         roads        A, Al,           A2,     and B were                those

referred            to         in     the         1932         deed.          Neither              party          could       find         anyone

whose        memory            dated          back       that      far        or obtain             aerial          photographs                that

old.         However,                the      jury      was presented                   with        circumstantial                     evidence
regarding            the        roads          in question.                   Two elderly                  witnesses,             Sid    Walker

and      Red        Tucker,                testified              that         roads           A     and         B existed               in     the

mid-1930s                and were              well-traveled                   at      the        time.           Walker         identified
the     roads        from            a 1937 aerial                photograph                 and testified                   that       he used

road     A as            a youngster                   to      reach       the        lake.           Tucker             testified             that

road     A was used                   at      the       time      to get            down to          the         boulevard             and that

road         B was            the       old        county         road.               Furthermore,                  Daly's             attorney

admitted            in        the     1989         letter         to     the        plaintiffs               that         road       A existed

in     1932.

         The        jury             was      presented                with          the      evidence              and      weighed            the

testimony                accordingly.                        Roads       Al      and        A2      are      actually             a part            of

road     A and are                  merely           different           forks,            both      of which             lead       to road          G

on     the        boulevard.                      Testimony              was        received              that      the      public            used

road     A in        the        mid-1930s               to      reach      road        G and that                 road     B was the            old

county         road.                We conclude                there      was substantial                         credible             evidence

to support               the        jury's           finding       that        plaintiffs                 possessed              an easement




                                                                          12
by     grant              over         roads         A,        Al,      A2,         and B,            and     therefore              affirm             that
portion          of         the        jury's             verdict.

                                                  Easements                  bv Prescription

          The             jury         determined                     that       Tanner               possessed              a      prescriptive

easement                  over           roads            D     and          E and          that             McFarland               possessed                 a

prescriptive                      easement                over         road     E.         Daly         argues          that        there          was no

evidence              in         the      record              which          established                 that         plaintiffs'                 use       of

roads          D and              E was           not         permissive.                    Daly            relies          on      a theory               of
neighborly                  accommodation                        alleging                there         was never               any     discussion

between              the         parties             or        their          predecessors                    regarding                use        of     the

roads          and         argues             that            courtesy              by    neighbors               is        not      adverse             and

cannot          ripen             into        a prescriptive                        easement.

          Plaintiffs                         concede                 that        the            jury          erred            in      finding                 a

prescriptive                      easement                   over        road            E in          McFarlands'                  favor.               The

McFarlands                 did         not      testify              that      they       used         road      E and therefore                        they

did      not         establish                  a prescriptive                        use        of     the      road.              The      Tanners,

however,              claim              they        were            using       roads            D and          E adversely                  under            a

belief          of        right          based          on the              language             of     the      1932 deeds               and argue

that      the        burden              was on Daly                   to     show that                the      use was permissive.

          To establish                        an easement                    by prescription,                         the      party         claiming

the       easement                     must          show            open,           notorious,                  exclusive,                  adverse,

continuous,                  and uninterrupted                               use of         the         easement            claimed           for        the

full      statutory                    period           of      five         years.          Public             Lands       Access           v.        Boone

& Crockett                   (19931,             259 Mont.                   279,        283,         856 P.Zd            525,       527          (citing

Keebler              v.      Harding                 (1991),            247         Mont.             518,      521,         807       P.2d            1354,


                                                                                13
1356).                  The         burden             is        on         the         party            seeking              to        establish                the
prescriptive                       easement                 and        all         elements                must          be        proved.                 Public
Lands            Access,            856 P.2d               at     527         (citing              Downing          v.     Grover               (1989),          237

Mont.            172,        175,         772 P.2d                850,         852).               To be adverse                        the        use     of    the

alleged                easement              must       be exercised                          under          a claim             of        right         and not

as     a mere                privilege                or        license                revocable              at      the          pleasure               of     the

owner            of     the        land.             Public            Lands                Access,           856 P.2d                at      527         (citing

Keebler,                807        P.2d         at     1356-57).                        Such          claim         must           be known               to     and

acquiesced                   in     by the            owner            of      the          land.          Public             Lands           Access,            856

P.2d        at         527        (citing            Keebler,                807 P.2d               at       1357).

            If        the     owner            shows permissive                             use,      no easement                     can be acquired

since            the     theory             of prescriptive                            easement              is     based           on adverse                  use.

Public            Lands             Access,             856        P.2d            at        527         (citing           Rathbun                 v.      Robson

(1983),                203 Mont.                319,            322,         661        P.2d          850,         852).              We have              stated

that         "'where                the        use         of     a way                by     a neighbor                   was          by      express             or

implied               permission                of     the        owner                . . . continuous                       use of               the     way by

the       neighbor                    [is]           not          adverse                   and          [does1          not            ripen            into          a

prescriptive                        right."'                     Public                Lands             Access,              856           P.2d         at      528

(quoting                Wilson            v.     Chestnut                    (1974),               164 Mont.             484,            491,           525 P.2d

24,      27).
          Roads              D and E branch                        off            of        road      A and lead                   to        the        Tanners'

garage            which            has been             there            for           at     least        fifty           years.               Mr.        Tanner

testified                   that       he has              used        the         roads            openly          and          continuously                    and
without               permission                for         as long               as he has owned                          his        property--over

twenty            years.               The       Tanners                believed                   they       had        a right                to       use     the


                                                                                   14
roads           based           on       the       language                     of        the           1932             deed       and           therefore
permission               from          Daly        was unnecessary.                                    The Tanners                     were          under          no
duty      to         communicate                to Daly            they         were using                      the       roads         under         a claim

of      right          and      adversely                to        her.               See         Woods             v.      Houle            (1988),              235

Mont.          158,      162,          766 P.2d            250,           252.

          Daly          was       aware           of     the         1932             deeds             and         their          reservation                      of

easements,               and         was also             aware            of         the         Tanners'                  use        of      the     roads.

The      Tanners              and      Daly        had unsuccessfully                                         attempted             to         work         out         a
cooperative                   maintenance                agreement                     for        roads.                  Daly         was      therefore

aware           of     the       right           created             by         the             deeds              and    acquiesced                   in         the
Tanners'              use       of       the       roads           for          a number                      of      years.                The       Tanners

established                   a presumption                   of     adverse                    use of              roads         D and E under                         a

claim       of        right          based        on their                1932 deed.

          We have               stated           that         I" [iln                order            to       overcome                 [the      claim             of

right1           presumption,                   thereby             saving                its         title           from        the        encumbrance

of     an easement,                  the        burden        is     on the                defendant                     to show that                 the         use

was permissive."'                            Woods 766 P.2d                          at      252           (quoting             Groshean,              et         al.

v.     Dillmont               Realty         Co.        (1932),            92 Mont.                     227,          239-40,               12 P.2d          273,

275).           The burden                 therefore               shifted                to      Daly             to present                evidence               of
permissive                    use          in          support                  of              her            theory             of           neighborly

accommodation.

          Daly         testified                as follows:
          Q: Now, you                    would agree,   would you not,  that you never
          gave anybody                   permission   to use Roads B, C, D, E, F or G?
          A:         I never          told        them        not         to.



                                                                            15
          Q: Well,               would you agree that,  in your deposition,    you
          admitted              that you never gave anyone permission   to use any
          of those              roads?
          A:        Right
          .    .     .    .

          Q: You didn't,                   in fact,          socialize             with        them,        did you?
        A: No.
        Q: You didn't                    have much contact                        at     all        with      them,     did
        YOU?
        A: No.
          Q: You didn't                  ever     do anything               --
        A: No.
          Q: -- that led                   them to believe                       that        you were granting
          them permission?
        A: No.
        The jury               was presented            with        evidence            and weighed the testimony
concerning                whether        or not Daly granted                      permission               to plaintiffs           to
use the roads                  in support         of her theory                  of neighborly                accommodation.
The jury            concluded            that     permissive                use had not                been established.
The    District                 Court       stated           that        "there              has     been      anything        but
neighborly                 accommodation                on     the         part         of     Defendants             regarding
Plaintiffs'                   use of the roads               in question."
        We conclude                 that        there        was substantial                       credible        evidence        to
support              the        jury's          finding             that          the          Tanners          possessed            a
prescriptive                   easement over roads D and E and therefore                                           affirm     that
portion            of the jury's            verdict.            We further               conclude           that      the jury's
finding            that       McFarland         possessed            a prescriptive                   easement over           road


                                                                    16
E is    not    supported         by substantial                  credible         evidence.         We reverse
that     portion         of      the     jury's           verdict           and     remand       for     further
proceedings           in that     regard.
                                       Easements by Necessity
       The jury          determined            that       Farrell          possessed         an easement           by
necessity       over     roads A and Al.                  Daly argues             that    this   issue    should
not have gone to the jury                   and that              no easements            by necessity       were
established        as a matter           of law,              citing      Schmid v.        McDowell       (1982),
199 Mont.       233,     649 P.2d 431.
        In    Issue     2 we held          that         all      of     the plaintiffs           possessed         an
easement       by grant         over    roads A, Al,                  A2, and B.          We therefore       need
not    reach    the      issue     of whether                 Farrell       possessed        an easement           by
necessity       over     roads     A and Al.
                                                      ISSUE 3
       Did the District                Court      err         in instructing             the jury      regarding
prescriptive           easements?
       The District             Court    instructed               the jury         as follows:
       The use of a neighbor's              land based on neighborly
       accommodation or courtesy is not adverse and cannot ripen
       into a prescriptive        easement.     Thus, where the use of a
       right-of-way        by a neighbor    was by express or implied
       permission      of the owner, the continuous use of the way by
       the neighbor        is not adverse and does not ripen into a
       prescriptive        right.    The mere use of a way for the
       required      time is not sufficient        to give rise   to the
       presumption       of a grant.     Some circumstances   or act, in
       addition     to the use, tending to indicate      that the use was
       not merely permissive,         is required.
        To establish     an easement by prescription,       the burden is
        on the Plaintiffs      to show several elements.       Plaintiffs
        or their     predecessors     in interest     must have used the
        route    openly,     notoriously,      exclusively,    adversely,

                                                          17
          continuously,                       and uninterrupted                             for      the       full         statutory
          period    of five                    years.

          Once the Plaintiffs     establish  these elements, adverse                                                                    use
          is presumed,     and the burden is then on the Defendants                                                                      to
          show that    the use was permissive.

          The Plaintiffs       and their  predecessors      were under no duty
          to communicate        by word of mouth to Defendants,         or their
          predecessors       in interest,   that Plaintiffs     were using the
          roadway      under     a claim     of  right      and  adversely       to
          Defendants.

          Daly      argues             that         on the         one hand the                    District            Court        instructed

the      jury       that          the         use     of      a neighbor's                        land         based          on neighborly

accommodation                   is      not     adverse             and cannot                    ripen        into         a prescriptive

easement.               Yet,           on the         other          hand,             the        District             Court        instructed

the      jury      that         adverse             use      is     presumed                  once       the     remaining              elements

for      prescriptive                  easement             are      established.                        Daly         claims        that      where

the      defense          is     permissive                 use through                    neighborly                 accommodation                the

presumption               of      adverse            use       should               not       apply.
          The      plaintiffs                  counter             that             the       presumption                of     adverse            use

applies            in          both           express              permission                      and         implied              permission

situations              and in           any event                Daly         still          had the          burden          to    establish

permissive              use.           The plaintiffs                         argue        that        even      if     the      instruction

was      improper,                it     was         harmless                 error           because           Daly          did     not         come

forward          with          sufficient              evidence                 showing             neighborly                accommodation

or permissive                   use.

          The general                  rule         in Montana                 is      that        111[ilf       the        given       instruc-

tions,          when           viewed           in         their          entirety,                    state          the       correct            law

applicable              to      the      case,            there          is        no reversible                  error."'                 Buhr     v.

Flathead           County               (1994),             268     Mont.                 223,       235,        886        P.2d      381,         388

                                                                              18
(quoting             Walden            v.      State          (1991),           250 Mont.                 132,        137,           818 P.2d            1190,

1193).           We have               stated          that         'I' [wlhen              examining             whether              certain            jury

instructions                    were          properly              given         or        refused,             we must               consider             the

jury          instructions                    in     their          entirety                 and         in     connection                   with        other

instructions                    given          and the              evidence                introduced                    at    trial."'                 Buhr
                                                                                                                                                         -r
886 P.2d              at       388          (quoting           Story         v.         City        Bozeman                 (1993),           259 Mont.

207,       222,           856 P.2d             202,         211).

           We conclude                      that       the        jury          instruction                    given           by      the      District

Court           correctly                   states            the         law       applicable                       to        the         case.            The

substance                 of    the         instruction                  was taken               from          our        holdings             in    Public

Lands          and Woods and it                         embodies                the         requirement                    that        Daly         has the

burden          to present                   evidence             of permissive                      use.            Plaintiffs                 believed
they       were           using        the         roads       adversely                    under        a claim               of    right          derived

from          the         1932         deed          and       Daly             failed              to        adequately                   rebut          this

presumption.                      We affirm                 the      District                 Court           on this               issue.
                                                                         ISSUE          4

           Did       the        District             Court          abuse         its        discretion                   in    concluding                that

an equitable                    award         of attorney                  fees         was not               proper           for     either            party

in     this         case?

           In       its        July      22,        1994,         opinion               and order               denying              Daly's          motion

for        summary              judgment               on     the         issue             of      compensatory                       damages,             the

District              Court            stated           that             "should              Plaintiffs                    prevail            on        their

malice          claims,               equity         may require                  an award                of attorneys'                      fees        under

the     Fey         exception                 in    order           to    fully             compensate                    Plaintiffs                in    this

action."


                                                                             19
(1990),                245      Mont.            308,      800 P.2d                 1053,          and urges                   us to          affirm        the
District                Court's              grant        of      summary             judgment                   in     her      favor.

            The longstanding                             rule         in     Montana              is      that          absent          statutory               or

contractual                    authority                attorney              fees        will          not          be awarded.                Howell          v.

State             (1994),              263         Mont.          275,          285,             868           P.2d       568,           574          (citing

Goodover                v.      Lindey's,                 Inc.             (19921,         255 Mont.                    430,       445,          843      P.2d

765,        774;         Bitney             v.    School          Dist.         No. 44                 (1975),           167 Mont.              129,      137,

535        P.2d         1273,          1277;            Ehly      v.        Cady          (1984),               212 Mont.               82,      100,       687

P.2d        687,         696).              Our review                of     a district                   court's              legal          conclusion

that        no basis                  for        attorney              fees          exists              is      plenary.                Howell,            868

P.2d        at         574       (citing             Steer,            Inc.         v.      Dept.               of     Revenue            (19901,           245

Mont.        470,             474-75,             803 P.2d             601,         603).

            In isolated                     instances             a district                  court             may award              attorney           fees

to      make            an      injured              party            whole          under               its          equity           powers.              See

Stickney                v.      State            (19811,          195 Mont.                 415,               636 P.2d           860;         Holmstrom

Land         Co.         v.       Hunter                (1979),              182         Mont.            43,          595      P.2d           360;       m.

Furthermore,                     in     certain                instances              in      which             bad faith               or malicious

behavior                are      involved                 this         Court          has         made an equitable                              award          of

attorney                fees.           See Matter                of        Estate          of         Lindgren                (1994),         268 Mont.

96,        102,         885      P.2d            1280,         1284.

            1n FOY we created                            an exception                     to the               general          rule      in order              to

compensate                    a party              who,          through              no         fault           of      her       own,         had       been

forced            to     hire         an attorney                 to        write          and argue                  a motion            to     dismiss.

We have            subsequently                      explained                 the        distinguishing                         characteristics

of     w         by stating:                       "The         Foy        exception              has been               narrowly              drawn        and


                                                                               21
           HOWeVer,                 in         its         August              30,       1994,            opinion                and        order          the
District               Court        concluded                   that      " [tlhis            Court        has been presented                             with

no      facts              which         would            justify              the      imposition                   of      attorneys'                   fees
under        the           Fov     exception,                    and the             equitable             awarding               of        attorneys'
fees       is         not     proper            as to            either          party         in     this           case."

           The District                       Court         further            ordered           that          neither            party           would      be

allowed               to      present                evidence             of        attorney            fees          to      the         jury,           thus

concluding                   as a matter                   of      law       that       any compensatory                          damages            which

might        be awarded                   would            not         include         attorney                fees.

           Plaintiffs                    argue            that         the      District              Court           misconstrued                   their

claim           for         attorney               fees.            Plaintiffs                 rely        on Boz-Lew                  Builders              v.

Smith           (1977),            174 Mont.                    448,         571      P.2d          389,        and        Cate        v.      Hargrave

(1984),               209        Mont.          265,            680       P.2d        952,          and        argue          that          when          Daly
erected               the        fence             and       denied             them          access            to        their         lake         shore

properties,                   dock,           and boat                 house,         she      set        in     motion           a sequence                 of

events            under            which             they         would             inevitably                 incur          attorney               fees.
Plaintiffs                   contend            that         the        District              Court        erred           by analyzing                    the

issue           under         Foy        v.        Anderson               (1978),           176 Mont.                 507,        580 P.2d                114,

and maintain                     that         the      issue           should         have gone to the                        jury          as part          of

its      determination                        of      compensatory                    damages.
           Daly             counters               that         the       decision             of     whether               or      not       to     award

attorney                fees        involves                 a question                  of      equity              and         therefore                lies

within           the        discretionary                       powers         of     the      District               Court.           Daly         argues

that       resolution                    of     the        issue          is     controlled                by Rasmussen                      v.     Fowler




                                                                                20
is applicable             only    where the action                into           which the prevailing                    party
has been forced                is utterly         without        merit           or frivolous."                  Goodover,
843 P.2d at 776 (citing                        State      ex rel.           Wilson        v.    Dept.        of Natural
Resources          (1982),        199 Mont.            189, 202,            648 P.2d 766,               772).
         We first             note      that      the      present               case     presents              neither                a
statutory         nor     a contractual                basis     for        the award of attorney                        fees.
Furthermore,             we conclude            this     case does not fit                     within        any of the
narrow        exceptions          to the general               rule.              The Fov exception                    is        not
applicable,             as here the plaintiffs                   obtained           an attorney             to initiate
legal        action.           They were          not     forced            to     defend       wholly           frivolous
litigation             through       no fault          of their         own.            We stated          in     Goodover
that     "Goodover's            position        as the plaintiff                   in this          litigation              .
will    preclude          an award of attorney's                   fees under Fey.”                     Goodover,                843

P.2d     at      775.         Nor does the             exception            involving           malicious              action
apply     to the present                case.      Even though plaintiffs                            sought       punitive
damages          due      to      Daly's         alleged          malicious               conduct,               the            jury
determined             that      punitive         damages          should           not        be     awarded.                   The
plaintiffs          did       not appeal         that     finding.
         Plaintiffs'             reliance        on fate         is misplaced.                  There we affirmed
the     jury's          award     of     attorney         fees         to        Hargrave,           a senior            water
appropriator,              who suffered                damages to            a dam and headgate                        due to
Gate's        interference             with     the dam and headgate.                       Cate filed            suit           for
a judicial             determination            as to whether                Hargrave          was wasting               water
by failing             to maintain            the dam and whether                    Hargrave           was exceeding



                                                            22
his lawful            appropriation              of water.            We affirmed              the jury's        award of
attorney          fees       stating:
           The Hargraves     as defendants     were compelled   to expend
           substantial    sums of money to prove that which was obvious
           to them from the start:         their   valid senior   right to
           thirteen    cubic feet per second of McGregor Creek.
w,          680 P.2d 957 (emphasis                        added).
           We distinguish               the present             case from Gate by noting                        that     here
the plaintiffs                were not forced                  to defend            a frivolous          legal         action
nor were the                easement          rights       they       claimed         as definitive              as those
associated            with      Hargrave's             senior        water      right.          Finally,         while       we
do not        condone           Daly's         actions         in     erecting           the     fence        around        her
property          we cannot        conclude            that     such action            is so reprehensible                   as
to fall        in line          with      our holding               in Q.&.
           In Rasmussen the plaintiff                           operated            a dry-land         wheat farm on
state       leasehold           property.           When the defendant                    erected       a gate across
a road        used by Rasmussen to reach                               the property,               Rasmussen filed
suit        and       requested           injunctive              relief.             We determined                  that       a
prescriptive                easement          existed          across         the     road       but     affirmed           the
district          court's         denial        of attorney             fees.         Rasmussen,            800 P.2d at

1057.
           We have held                that     absent         an abuse of discretion                         this      Court
will       not reverse           the district              court's          decision         concerning          attorney
fees.         Sage v. Rogers                  (19931,          257 Mont.         229,      242,        048 P.2d 1034,
1042        (citing         Joseph        Russell         Realty        Co. v.           Kenneally            (1980),       185
Mont.        496,        505,     605 P.Zd             1107,         1112).          The test           for      abuse       of
discretion             is    whether          the      trial        court      acted       arbitrarily               without

                                                                23
employment         of      conscientious         judgment        or     exceeded      the        bounds   of
reason      resulting         in   substantial          injustice.              Gaustad     v.     City   of
Columbus          (1995),      272 Mont.         486,     488,        901 P.2d       565,        567.     We
conclude        that    the District        Court       did   not       abuse its     discretion          in
determining         that     an equitable        award of attorney              fees was not proper
for    either      party      in   this    case.        We affirm         the District            Court   on
this     issue.



                                                                      Justice

We concur:




                                                    24
