                                                                                             06/09/2017


                                          DA 16-0602
                                                                                         Case Number: DA 16-0602

              IN THE SUPREME COURT OF THE STATE OF MONTANA
                                         2017 MT 139N



BRIAN MOONEY,

               Plaintiff and Appellee,

         v.

SUSAN ASHCRAFT,

               Defendant and Appellant.


APPEAL FROM:           District Court of the Tenth Judicial District,
                       In and For the County of Judith Basin, Cause No. DV-2015-9
                       Honorable Jon A. Oldenburg, Presiding Judge


COUNSEL OF RECORD:

                For Appellant:

                       Jack R. Stone, Attorney at Law, Lewistown, Montana

                For Appellee:

                       Craig R. Buehler, Attorney at Law, Lewistown, Montana



                                                   Submitted on Briefs: April 26, 2017

                                                              Decided: June 9, 2017


Filed:

                       __________________________________________
                                         Clerk
Justice Jim Rice delivered the Opinion of the Court.

¶1     Pursuant to Section I, Paragraph 3(c), Montana Supreme Court Internal Operating

Rules, this case is decided by memorandum opinion and shall not be cited and does not

serve as precedent. Its case title, cause number, and disposition shall be included in this

Court’s quarterly list of noncitable cases published in the Pacific Reporter and Montana

Reports.

¶2     Appellant Susan Ashcraft (Ashcraft) appeals the judgment of the Tenth Judicial

District Court, Judith Basin County, granting a right to use the well located on her property

to Appellee Brian Mooney (Mooney). We reverse.

¶3     Ashcraft owns Lots 4-6 and 11-13, Block 4, of the Original Townsite of Moccasin,

Montana. Mooney owns Lots 7-10 and 14-18 of Block 4, which lie on either side of

Ashcraft’s property. Lot 11, one of Ashcraft’s lots, contains a well that has served multiple

properties in Moccasin over time, including the Moccasin School, which is now closed,

and Mooney’s property.

¶4     Ashcraft’s predecessors-in-interest include Emma Todd (Todd) and Phillip J. Mills

(Mills), who held the property as tenants-in-common. In 1997, Todd and Mooney’s father,

E. L. “Eddie” Mooney, signed a document entitled “Request for Water Usage,” which

stated in full:

       I, Emma Todd, do hereby grant E. L. Eddie Mooney the right and privilege
       to drawing water from my well located in Moccasin, MT. This privilege
       shall be for personal use only and shall endure as long as E.L. Mooney lives
       on and owns the property described as Lots 7, 8, 9[,] and 10[,] in Block 4 of
       the original townsite of Moccasin, Judith Basin County, Montana.

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¶5     This document was not signed by Todd’s co-tenant, Mills, and, further, the record

indicates Mills was not advised of and did not know about Todd’s action. On August 9,

2002, Todd executed a Power of Attorney appointing her niece, Mona Harrell (Harrell), as

her attorney-in-fact. Harrell was authorized to make decisions concerning Todd’s real

estate interests. At some point, Todd hesitantly told Harrell that she had given permission

to Eddie Mooney to use the well occasionally for purposes of building a garage. In

2002-2003, Mooney dug a trench for a water line from the well to his father’s property

based upon the verbal permission of Todd. During this time Ashcraft approached Mooney

and told him he had no right to construct the ditch, but took no further action with regard

to the ditch.

¶6     In March of 2003, Ashcraft purchased Mills’ half-interest in the property, becoming

a co-tenant with Todd. In May 2003, she sent Mooney a letter informing him that Harrell

was Todd’s attorney-in-fact and inquiries involving Todd’s half-interest in the property

should be directed to Harrell. The record indicates Ashcraft, like Mills, was not advised

and did not know about the “Request for Water Usage” document, which had been signed

by Todd and Eddie Mooney. In June of 2003, Mooney purchased Lots 7-10 and 14-18

from his father, which terminated the right to use the well granted under the 1997 “Request

for Water Usage,” according to its terms.

¶7     In November of 2003, despite Harrell’s appointment as Todd’s attorney-in-fact, and

Ashcraft’s letter advising Mooney to deal with Harrell, Todd and Mooney signed another

“Request for Water Usage” that was similar to the first one, and which provided, in full:

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      I, Emma Todd, do hereby grant Brian K. Mooney the right and privilege to
      drawing water from my well located in Moccasin, Montana. This privilege
      shall be for personal use only and shall endure as long as Brian K. Mooney
      lives on and owns the property described as Lots 7, 8, 9, 10, 14, 15, 16, 17[,]
      and 18[,] in Block 4 of the original townsite of Moccasin, Judith Basin
      County, Montana.

This document is referred to herein as the “Agreement.” The record indicates that Harrell

and Ashcraft were not advised and did not initially know about the existence of the 2003

Agreement.

¶8    Mooney testified that during the time period of “2003, ’04, right in there, 2002 to

2004 let’s say,” a lock was placed on the pump house door, and Mooney cut it off. Yet,

also in 2004, Mooney submitted a “Notice of Water Right” with the Department of Natural

Resources and Conservation (DNRC) regarding the well. The notice, signed only by

Mooney, listed Mooney and Harva Ashcraft, Ashcraft’s sister, as the owners of the well,

but added language in the “Remarks” section as follows: “permission granted by well

owner Emma Todd.” (Emphasis added.) There is no indication that either Todd or

Ashcraft played any role in submitting the notice. However, testimony was given that Todd

believed she was in control of the well and had granted Mooney permission to use the well

because “she said she felt sorry for him because he’d been to prison.” The DNRC issued

an “Acknowledgement of Exempt Water Right” in the well, based on the notice submitted

by Mooney.

¶9    Todd and Ashcraft were tenants-in-common and owned the property from 2003

until Todd’s death in 2005. Harrell inherited Todd’s interest in the property. In November

2006, an attorney for Harrell and Ashcraft, newly co-tenants, wrote to Mooney and asked
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for clarification about the well usage. In March 2007, then unaware of the Agreement,

Harrell and Ashcraft sent a letter to Mooney’s attorney, stating their belief that it was “not

legal for a person go to on another person’s land and hook up to their water without

permission.” In August of 2007, Ashcraft purchased Harrell’s interest in the property,

becoming the sole owner. Mooney used the well and performed maintenance on the pump

continuously through the subject period. At times, each party put locks on the pump house.

On one occasion, Harrell and Ashcraft placed a lock on the pump house, and Mooney took

it off, proceeding to put his own lock on the pump house. The Sheriff’s Office was called

on several occasions, with Harrell calling for assistance in dealing with Mooney’s

excessive yelling and profanity. On one occasion, Ashcraft placed a lock on the pump

house but gave a key to Mooney to access the pump house. In July 2013, Ashcraft wrote

to Mooney, stating,

       [u]nless there is an emergency situation, such as the power to the pump
       needing to be cut, fire, etc., I respectfully ask to be notified in advance of
       your intention to access the well through my property and I ask to be
       consulted in advance of any work done or changes made to the well or pump.

In December 2014, Mooney wrote to Ashcraft, returning two checks, which Ashcraft had

previously given to Mooney for reimbursement of the costs of a new pump and other

equipment for the well. Mooney’s letter stated:

       The well is a privelage [sic] to me & I thank you, so much. To help you
       Physically [sic] & financially with this privelage [sic] is all I can do to show
       my appreciation. P.S. I will send check soon for the electricity bill for pump
       & water usage, again Thank you Very Much [sic].




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¶10    In June of 2015, Ashcraft sent a letter to Mooney informing him that his access to

the well would be terminated on July 10, 2015. Mooney initiated this litigation to prevent

Ashcraft from shutting off the water. Additional facts will be discussed herein.

¶11    After a bench trial on September 7, 2016, the District Court concluded that: (1) the

Agreement was a valid contract between Todd and Mooney, which granted Mooney a right

to use the well and bound Ashcraft; (2) alternatively, Mooney had acquired a right to use

the well through adverse possession; and (3) alternatively, laches barred Ashcraft from

protesting Mooney’s right to use the well.

¶12    “We review for clear error a district court’s findings of fact.” Roland v. Davis, 2013

MT 148, ¶ 21, 370 Mont. 327, 302 P.3d 91. “Clear error exists if substantial, credible

evidence fails to support the findings of fact, if the district court misapprehended the

evidence’s effect, or if we have a definite and firm conviction that the district court made

a mistake.” Roland, ¶ 21. “We review de novo a district court’s conclusions of law” to

determine if the district court’s conclusion is correct. State v. Steigelman, 2013 MT 153,

¶ 10, 370 Mont. 352, 302 P.3d 396; Stanley v. Lemire, 2006 MT 304, ¶ 52, 334 Mont. 489,

148 P.3d 643.

Water Use Agreement

¶13    The District Court determined that the four required elements of a contract were

established, including consent, and the Agreement between Todd and Mooney was binding

on Todd’s co-tenant, then Ashcraft, even though Ashcraft did not sign the Agreement and

was initially unaware of its existence. The general principle of law is that there is no agency

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relationship between co-tenants and, therefore, one co-tenant cannot bind another co-tenant

in a contract:

       Since there is, merely by reason of the existence of a cotenancy, no agency
       relationship between the cotenants, one cotenant cannot ordinarily bind
       cotenants by contracts with third persons or transfer or dispose of the interest
       of another cotenant in such a manner as to be binding, unless duly authorized
       to do so, unless his or her act is thereafter ratified by the other cotenants.
                                             . . .
       In the absence of authorization or ratification on the part of the cotenants,
       any dealing on the part of one cotenant in relation to the common property is
       a nullity insofar as their interests are concerned.

20 Am. Jur. 2d Cotenancy and Joint Ownership § 93 (2015) (citations omitted; annotations

omitted). Our case law supports this general position. In Dew v. Dower, 258 Mont. 114,

128, 852 P.2d 549, 557 (1993), we stated “co-tenants are not generally agents of each

other.” As such, Todd was not an agent of Ashcraft and Todd’s Agreement with Mooney

was not binding upon her, unless she ratified the Agreement. Ratification requires:

(1) “acceptance by the principal of the benefits of the agent’s act”; (2) “with full knowledge

of the facts”; and (3) “circumstances or an affirmation election indicating an intention to

adopt the unauthorized arrangement.” Safeco Ins. Co. v. Lovely Agency, 200 Mont. 447,

453, 652 P.2d 1160, 1163 (1982); Erler v. Creative Fin. & Invs., 2009 MT 36, ¶ 27, 349

Mont. 207, 203 P.3d 744. The record here indicates that Todd did not inform either Harrell,

her attorney-in-fact, or Ashcraft of the Agreement. And, according to the testimony,

neither did Mooney. In fact, Harrell testified that Mooney told her he “had a paper” giving

him a right to use the well, but refused to show it to her. She stated as follows:




                                          7
       [Brian Mooney said], I have the paper. And I said Brian I’ve asked you and
       asked you for a copy and I’ve asked you very nicely to see that. And he
       refused to show that to me [sic].

Given Todd’s initial failure to provide notice of the Agreement to either Harrell or

Ashcraft, and Mooney’s actions to prevent them from seeing the Agreement, we cannot

conclude that either Harrell or Ashcraft “accepted the full benefits” of the Agreement, with

“full knowledge,” and made “an affirmative election” of the Agreement. Safeco Ins. Co.,

200 Mont. at 453, 652 P.2d at 1163. The Agreement was therefore not ratified and is not

binding on Ashcraft.

Adverse Possession

¶14    “A prescriptive easement arises by operation of law when a claimant proves that his

or her use of another’s property was open, notorious, exclusive, adverse, continuous, and

uninterrupted for the statutory period.” Pedersen v. Ziehl, 2013 MT 306, ¶ 13, 372 Mont.

223, 311 P.3d 765 (citation omitted; original emphasis removed); see Havre Irrigation Co.

v. Majerus, 132 Mont., 410, 415, 318 P.2d 1076, 1078-79 (1957). Montana’s prescriptive

period is five years. Section 70-19-404, MCA. The District Court concluded that Mooney

established his right to use the well through adverse possession because “[h]is use of the

well [was] both hostile and adverse.”

¶15    Importantly, “[i]f a use begins as a permissive use it is presumed to continue as

such.” Pedersen, ¶ 15 (internal quotation removed; citation omitted). “In fact, if the use

begins as a permissive use, it cannot ripen into a prescriptive right, no matter how long it

may continue, unless there is a distinct and positive assertion of a right hostile to the

                                         8
owner.”      Pedersen, ¶ 15 (internal quotation removed; citation omitted).        We have

explained:

       [t]he law is very rigid with respect to the fact that a permissive use in the
       beginning can be changed into one which is hostile and adverse only by the
       most unequivocal conduct on the part of the user. The rule is that the
       evidence of adverse possession must be positive, must be strictly construed
       against the person claiming a prescriptive right, and that every reasonable
       intendment should be made in favor of the true owner.

Martin v. Randono, 175 Mont. 321, 327, 573 P.2d 1156, 1160 (1978) (emphasis added;

internal quotation omitted; citations omitted).

¶16    There is ample evidence that Mooney’s use of the well was long occasioned by a

grant of permission. To begin, both the 1997 and 2003 agreements consisted of Todd’s

granting permission to use the well, which Mooney acknowledges as permissive. The 2003

Agreement stated “[t]his privilege shall be for personal use only and shall endure as long

as Brian K. Mooney lives on and owns the property . . . .” (Emphasis added.) Although

we held, above, that the Agreement was not binding upon Ashcraft, it nonetheless

demonstrates Todd’s act of extending permission to Mooney to use the well as long as he

owned the neighboring property. Throughout the years, Mooney repeatedly claimed a right

to use the well based upon this Agreement, and he never disavowed that written permission.

While Mooney can point to various acts of aggression during the period, he does not

demonstrate this was hostility supporting a claim of right rather than hostility expressed in

the preservation of his permitted use. In fact, when the Sheriff was called to intervene,

Mooney asserted that his right to use the well arose from “the paper,” which he showed to

the officer. Mooney points to Ashcraft’s trial testimony and letters, which indicate that
                                          9
Mooney did not have any right to use the well, as evidence of hostility. However, the

letters also recognize that Mooney may have a permissive right to use the well that should

be continued. In her 2007 letter to Mooney’s attorney, Ashcraft indicates that if Todd had

given Mooney permission to use the well, “then we can sit down and talk about the

circumstances under which [Harrell] and I would be willing to sign a similar agreement

with him. It is my belief that it would benefit all of us if this issue were clarified on paper.”

This evidence, and the record as a whole, presents equivocal intentions concerning whether

the situation had become hostile or the parties were continuing to work from the 2003 grant

of permission. In 2013, Ashcraft placed parameters on Mooney’s access to the well in a

letter. In 2014, Mooney wrote to Ashcraft that “[t]he well is a privelage [sic] to me”—the

same language employed in the Agreement granting permission. As the District Court

found, it was not until June 2015 that Ashcraft provided a “formal objection” to Mooney’s

use of the well. Critical here are the governing principles that use which begins as

permissive is “presumed to continue as such” and can be changed into a hostile and adverse

claim “only by the most unequivocal conduct on the part of the user.” Martin, 175 Mont.

at 327, 573 P.2d at 1160. As detailed above, Mooney’s actions did not constitute “the most

unequivocal conduct.” Instead, his actions demonstrated vacillating intentions about the

nature of his right to use the well, often expressing that his right to use the well arose from

the permissive terms of the Agreement.

¶17    When we consider the record as a whole we are convinced the District Court

misapprehended the effect of the evidence, and entered conclusions of law that were

                                           10
incorrect. We conclude the District Court’s legal conclusion that Mooney’s use of the well

“[was] both hostile and adverse” failed to apply the governing principle. Use that begins

as permissive is presumed to remain permissive, unless countered by “the most

unequivocal conduct,” particularly where, as the record indicates here, Mooney repeatedly

acknowledged that his right to use the well arose from that initial grant of permission.

Mooney did not obtain a right to use the well through adverse possession.

Laches

¶18   Laches applies when one party has been negligent in asserting its rights and the

other party had been prejudiced by the delay.

      Laches is an equitable doctrine by which a court may deny relief to a party
      who has unreasonably delayed or been negligent in asserting the claim, when
      the delay or negligence has prejudiced the party against whom relief is
      sought. For laches to apply, there must be a showing that the passage of time
      has prejudiced the party asserting laches or has rendered the enforcement of
      a right inequitable.

Phillips v. City of Whitefish, 2014 MT 186, ¶ 22, 375 Mont. 456, 330 P.3d 442 (internal

quotations omitted; internal citations omitted). The District Court determined Ashcraft sat

on her rights in violation of the policy codified at § 1-3-218, MCA. The District Court

found Ashcraft should have acted, at the latest, in 2007 when she became the sole interest

holder in the property. The District Court based this conclusion on its determination that

Ashcraft “never gave either implied or explicit permission to use the well.” As we have

stated above, Mooney’s use of the well began as permissive and was presumed to remain

permissive. Ashcraft expressed concerns in person and through counsel, and offered to

continue that permissive use. When Ashcraft sent her June 2015 letter indicating that she
                                        11
intended to shut off water to Mooney, the relationship became unequivocally hostile. This

litigation then followed. We conclude that Ashcraft did not sit on her rights and Mooney

did not obtain a right to use the well through the application of laches.

¶19    We have determined to decide this case pursuant to Section I, Paragraph 3(c) of our

Internal Operating Rules, which provides for memorandum opinions. This appeal presents

no constitutional issues, no issues of first impression, and does not establish new precedent

or modify existing precedent.

¶20    We reverse the judgment of the District Court and remand for entry of a judgment

in favor of Ashcraft.

                                                  /S/ JIM RICE

We concur:

/S/ JAMES JEREMIAH SHEA
/S/ DIRK M. SANDEFUR
/S/ BETH BAKER

Chief Justice Mike McGrath, dissenting.

¶22    I dissent. As the District Court noted, Brian Mooney brought this action after he

invested significant time and expense based on his continuing right to use the well. Susan

Ashcraft sat on her right to bring a claim for years. The doctrine of laches should be applied

to her claim. It is inequitable to allow Susan Ashcraft to enforce her legal rights at this

point in time. Phillips v. City of Whitefish, 2014 MT 186, 375 Mont. 456, 330 P.3d 442.

¶23    I would affirm the District Court.


                                                  /S/ MIKE McGRATH
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