Court Opinion

ID: 2832664
Source: CourtListenerOpinion
Date Created: 2015-09-01 15:09:17.673837+00
Date Added: 2024-06-11T12:27:42.171087
License: Public Domain

MAINE SUPREME JUDICIAL COURT                                                     Reporter of Decisions
Decision: 2015 ME 120
Docket:   Lin-14-296
Argued:   February 12, 2015
Decided:  September 1, 2015

Panel:          SAUFLEY, C.J., and ALEXANDER, MEAD, GORMAN, and JABAR, JJ.

                                     SALLY C. PEW et al.

                                                  v.

                                 ROBERT N. SAYLER et al.

MEAD, J.

         [¶1]    Plaintiffs Sally C. Pew1 and the Trustees of the John P. Cooke

Disclaimer Trust (Cooke) own most of Mouse Island in the Town of Southport in

common with defendants Robert and Martha Sayler, John and Marcia Hincks, and

Peter and Maria Nickles (collectively, the Other Owners).

         [¶2] Pew and Cooke appeal from a summary judgment entered by the

Superior Court (Lincoln County, Hjelm, J.) in favor of the Other Owners on Pew

and Cooke’s complaint for equitable partition, and from the court’s post-trial

judgment on the Other Owners’ counterclaim awarding them damages for

nonpayment of commonly-shared expenses. Pew and Cooke contend that the court

erred in determining that (1) a right of first refusal (ROFR) in the parties’ deeds

and contractual agreements constituted a waiver of their right to partition, (2) the
   1
     Pew’s husband, George Pew, was a plaintiff in this case but died prior to the entry of judgment by
the Superior Court.
2

right of first refusal did not violate the rule against perpetuities, (3) the parties’

agreements required the employment of a full-time caretaker on the island absent a

two-thirds vote to the contrary, and (4) Pew and Cooke were liable for certain

commonly-shared expenses that they had not paid.

      [¶3] We conclude that the rights of first refusal in the parties’ deeds violate

the rule against perpetuities and are therefore void as a matter of law. The rights of

first refusal in the parties’ separate contractual agreements with one another,

however, are valid vis-à-vis each other and constitute an effective waiver of these

parties’ rights to equitable partition. On that basis, and because we conclude that

the court did not err in apportioning expenses, we affirm the judgment.

                                I. BACKGROUND

A.    The Land at Issue

      [¶4] The historical facts are not disputed. Excepting three houses and the

land underlying them that they own individually, the parties jointly own Mouse

Island. The three separately-owned houses are referred to as Mousetrap, which is

owned by Sally Pew; Brown House, in which the Nickleses and the Saylers each

own a one-half undivided interest; and Gray House, in which the Hinckses and

Cooke each own a one-half undivided interest. Pew owns a one-third undivided

interest in the island’s common property; the Nickleses, Saylers, Hinckses, and

Cooke each own a one-sixth undivided interest.
                                                                                     3

B.     Relevant Agreements

       [¶5] Several agreements entered into by the parties or their predecessors in

title are relevant to our analysis.

       1.     August 21, 1978, Letter of Agreement

       [¶6] A letter setting out the basic terms of the purchase of Mouse Island,

signed by these parties or their predecessors, contained the following provisions:

       [Nickles, Pew, and Sayler] understand[] that the caretaker is receiving
       $700 a month plus payment for utilities. [They] agree[] that the
       caretaker should continue in his position and receive the same
       monthly payments.

       All the parties are agreed that any proposal for future development on
       the Island would require the written, unanimous concurrence of all
       owners of the Island. Further, it is agreed that, if any owners wish to
       dispose of any or all of his or her interest, that interest will first be
       offered to the Other Owners to provide them with the opportunity first
       to purchase the interest.

       It is agreed that an association of owners will be created to collect
       assessments from the owners for payment of the caretaker’s salary,
       real estate taxes, and general maintenance. These assessments will be
       divided equally among the three principal houses . . . . Each of the
       parties understands that in situations where the caretaker must call in
       outside assistance to work on a project affecting only a particular
       house, the owner of that house will pay for the outside assistance.
       Work done by the caretaker on common Island property, such as the
       sea wall, studio, tennis courts, etc., will be shared by all owners.
       Further, it is understood that the caretaker’s work on each of the
       homes on the Island will not change the basi[c] intention of the parties
       to share equally the caretaker’s salary and benefits.
4

      2.    December 26, 1978, Purchase and Sale Agreement

      [¶7] A formal purchase and sale agreement executed by the parties or their

predecessors contained two relevant provisions: (1) a requirement that a right of

first refusal be included in the deeds, and (2) an agreement that the owners of

Mouse Island would create an association within 120 days “for the purpose of

maintaining all the facilities, buildings and improvements on or related to Mouse

Island excepting [the three separately-owned houses] . . . and generally governing

the management of the Island.”

      3.    The Deeds

      [¶8] As provided in the purchase and sale agreement, the deeds leading to

the current ownership situation on Mouse Island each contained the following

clause:

      In the event that the grantee desires to sell the real estate herein
      conveyed, the grantee shall prior to the acceptance of any offer
      received by him/her make a similar offer excepting only as to the time
      set for acceptance to his/her dwelling co-tenant of record and to
      his/her co-tenants in Mouse Island. His/her dwelling co-tenant shall
      have 30 days in which to accept the grantee’s offer. If his/her
      dwelling co-tenant accepts the offer, all other offers made by the
      grantee shall automatically be terminated. If his/her dwelling
      co-tenant does not accept the offer within said 30-day period, the
      Island co-tenants shall have 15 days in which to accept the grantee’s
      offer. In the event that two or more Island co-tenants attempt to
      accept the offer after the dwelling co-tenant’s time for acceptance has
      terminated, the first acceptance from an Island co-tenant received by
      the grantee shall be binding and other attempted acceptances after said
                                                                               5

      receipt shall be void. Closing shall be within 90 days of the
      acceptance of the grantee’s offer . . . .

      [¶9] The deed from John P. Cooke to his successors, the Cooke Trustees,

inadvertently omitted the clause; in entering a partial summary judgment in this

case the Superior Court, without objection, reformed the Cooke Trustees’ deed to

include the clause.

      4.     The Agreement of Principles

      [¶10] Subsequent to the execution of the deeds, Pew, Nickles, Sayler, and

the predecessors of Hincks and Cooke signed an “Agreement of Principles for

Mouse Island” (AOP). The court found that

      [t]he original owners, including the Pews, the Saylers and the
      Nickleses, entered into [the AOP]. . . . They executed the document
      proximate in time to when they bought the island. Although Cooke
      and the Hinckses acquired their ownership interest after the original
      owners signed the AOP, they considered themselves to be bound by it.
      The court therefore treats all of the present owners as parties to the
      agreement.

Although the Cooke Trustees challenge the court’s construction of the AOP, they

do not contest its finding that they are bound by it.

      [¶11] The AOP created six voting shares, two for each of the three houses.

As a result, Pew has two voting shares and Cooke and the Other Owners each have

one. The AOP states, in relevant part:

      The undersigned, who are the owners of Mouse Island, express their
      intention that the Island be maintained essentially as it is today and
6

      that the working island atmosphere be maintained and enhanced. . . .
      The parties also take this occasion to reaffirm the covenants in their
      deeds respecting the right of first refusal accorded individual property
      co-tenants or Island co-tenants.

      ....

      The parties agree that any significant changes affecting the Island
      require a two-thirds vote of the parties, i.e., four shares. Similarly,
      any change in the principles established by this Agreement shall be by
      two-thirds vote of the parties.

C.    Procedural History

      1.     Complaint

      [¶12] In July 2011, Pew filed a complaint in the Superior Court naming the

Other Owners as defendants, and Cooke as a party-in-interest. The complaint

alleged, and the Other Owners admitted, that the parties had managed Mouse

Island by consensus for over thirty years and had employed a year-round caretaker

during that time. The current salaried caretaker lives on the island with his wife.

In 2010 the Other Owners unilaterally raised the caretaker’s annual salary by

$6,000, an increase that Pew and Cooke refused to pay. Because of her concerns

regarding the caretaker’s role, cost, and performance, Pew notified the Other

Owners that she would stop contributing to the caretaker’s salary altogether as of

October 15, 2010, although Pew and Cooke maintain that they paid their share of

other common expenses.
                                                                                      7

      [¶13] The complaint asked the court to partition the island into two lots, one

being a lot solely-owned by Pew, and to declare that all prior agreements among

the parties were null and void, including any obligation Pew had to contribute to

the caretaker’s salary after October 2010.

      2.      Counterclaims and Cross-Claim

      [¶14] The Other Owners counterclaimed against Pew and Cooke, asking the

court to declare, inter alia, that (1) the right of first refusal contained in the deeds

waived the owners’ partition rights, (2) Pew had breached the AOP by seeking

partition without complying with the right of first refusal, and (3) Pew and Cooke

had breached the AOP by refusing to pay their share of the caretaker’s salary

without first obtaining a two-thirds majority to terminate him in accordance with

the AOP.

      [¶15]     Cooke joined Pew’s action to partition Mouse Island and

cross-claimed against the Other Owners, asking the court to (1) partition Gray

House by ordering that, through a bidding process, either Cooke buy out the

Hinckses’ interest or they buy out Cooke’s interest; (2) further partition the island

if Cooke bought out the Hinckses’ interest and Pew’s request for partition was

granted, resulting in three lots: one owned by Pew, one owned by Cooke, and the

remaining lot owned by the Nickleses and Saylers; and (3) declare prior

agreements null and void.
8

      [¶16]     The Other Owners moved to dismiss the cross-claim and

counterclaimed against Cooke, alleging unjust enrichment arising from Cooke’s

continued receipt of the benefit of the caretaker’s services without paying for that

benefit.

      3.      Summary Judgment

      [¶17] All parties moved for summary judgment. See M.R. Civ. P. 56. The

court denied the motions and also denied the Saylers’ motion to dismiss Cooke’s

cross-claim. It concluded that

      under the better view of the law, as a general matter, when a co-tenant
      gives a right of first refusal to other co-tenants, the former impliedly
      waives her right to obtain the physical partition of the island that
      would be based on a divided fractional ownership interest, at least
      until the selling co-tenant receives a bona fide offer from a third-party
      to acquire that interest.

However, because the Cooke deed did not contain the right of first refusal clause

found in the Other Owners’ deeds, the court determined that an issue of material

fact existed that precluded summary judgment.

      [¶18] In December 2012, the Other Owners filed a supplemental motion for

summary judgment, asserting that the omission of the right of first refusal from

Cooke’s deed was inadvertent, and that the deed should be reformed. Pew and

Cooke did not contest that assertion, and the court reformed the Cooke deed. As a

result, the issue of fact precluding summary judgment was resolved, and the court
                                                                                   9

entered a summary judgment for the Other Owners on those counts of the

complaint and counterclaim concerning partition, declaring: “The mutual rights of

first refusal set out in the deeds of the parties result in a waiver of the right to

partition of the Mouse Island property.” Because the claims against Pew and

Cooke for breach of the AOP and unjust enrichment remained pending, the court

declined to enter its decision as a partial final judgment pursuant to

M.R. Civ. P. 54(b)(1).

      4.     Trial

      [¶19] The court held a bench trial concerning the remaining claims and

found that “the instruments defining the parties’ ownership obligations require

them to pay for a resident caretaker,” a requirement that could only be altered by a

two-thirds vote pursuant to the AOP. As a result, the court concluded that “all of

the owners are jointly liable for the expenses arising from [the caretaker’s] role as

island caretaker. This means that Pew and Cooke are liable for their share of that

expense.” It then parsed out expenses that the Other Owners claimed were joint

obligations, allowing some and disallowing others.       The court entered a final

judgment incorporating its prior decisions and awarded the Other Owners

$67,110.63 plus interest and costs from Pew, and $16,779.45 plus interest and

costs from Cooke.

      [¶20] This appeal followed.
10

                                            II. DISCUSSION

A.       Right of First Refusal: Deeds

         [¶21] Pew and Cooke assert that the right of first refusal (ROFR) in their

deeds is void because it violates the rule against perpetuities. We agree. “Maine

follows the traditional common law rule against perpetuities that, ‘no interest is

good unless it must vest, if at all, not later than twenty-one years after some life in

being at the creation of the interest.’”2 White v. Fleet Bank of Me., 1999 ME 148,

¶ 10, 739 A.2d 373 (citation omitted). In Low v. Spellman, we held that the rule

applies to rights of first refusal, at least those that last perpetually.3 629 A.2d 57,

58 (Me. 1993).

     2
     The common law rule is modified by Maine’s “wait and see” statute, 33 M.R.S. § 101 (2014), which
provides:

                   In applying the rule against perpetuities to an interest in real or personal property
         limited to take effect at or after the termination of one or more life estates in, or lives of,
         persons in being when the period of said rule commences to run, the validity of the
         interest shall be determined on the basis of facts existing at the termination of such one or
         more life estates or lives. In this section an interest which must terminate not later than
         the death of one or more persons is a “life estate” even though it may terminate at an
         earlier time.

See White v. Fleet Bank of Me., 1999 ME 148, ¶ 11, 739 A.2d 373. The statute is not applicable in this
case because the ROFR in the parties’ deeds is not in any way related to “life estates in, or lives of,
persons in being,” 33 M.R.S. § 101 (2014); rather, as discussed infra, it runs with the land. See White,
1999 ME 148, ¶ 23, 739 A.2d 373 (“Maine’s ‘wait and see’ statute is in derogation of the common law,
and as such, must be narrowly construed.”).
     3
     Our opinion in Low suggested that rights of first refusal that do not “endure[] forever” and do not
mandate a fixed sale price might not violate the rule against perpetuities. See Low v. Spellman,
629 A.2d 57, 58 (Me. 1993). Because we conclude that the ROFR at issue in this case is perpetual, we
need not decide whether the rule applies to all such preemptive rights.
                                                                                  11

      [¶22] The ROFR in the Pew and Cooke deeds is perpetual. In contrast to

Tarason v. Wesson Realty, LLC, where a deed’s use of the term “this Grantee” led

us to conclude that a conveyed easement was personal, and not an easement

appurtenant, 2012 ME 47, ¶¶ 19-20, 40 A.3d 1005, the ROFR clauses in the Pew

and Cooke deeds refer to “the Grantee.”          In combination with the deeds’

conveyance to Pew, Cooke, and their “heirs and assigns,” that language suggests

that the ROFR was intended to remain applicable in succeeding conveyances.

      [¶23] Furthermore, in 2013 the Legislature amended the governing statute

to make clear its preference for the conveyance of fee simple, as opposed to

personal, interests. P.L. 2013, ch. 90, § 1 (effective Oct. 9, 2013) (codified at

33 M.R.S. § 772(1) (2014)). As amended, the statute provides:

      In a conveyance or reservation of real estate, the terms “heirs,”
      “successors,” “assigns,” “forever” or other technical words of
      inheritance, or an habendum clause, are not necessary to convey or
      reserve an estate in fee. A conveyance or reservation of real estate,
      whether made before or after the effective date of this section, must be
      construed to convey or reserve an estate in fee simple, unless a
      different intention is clearly expressed in the instrument by a
      statement that the interest conveyed or reserved is an interest other
      than an estate in fee, by a limiting of the duration of the interest to a
      period less than perpetual duration or by an explicit restriction of the
      interest to the use and benefit only of the person or persons to whom it
      is conveyed or reserved. The omission of technical words of
      inheritance may not be construed to evidence an intention to convey
      or reserve an interest other than an estate in fee simple, even if such
      words are used elsewhere in the same instrument.
12

33 M.R.S. § 772(1) (emphasis added). Nothing in the ROFR at issue limits its

duration or explicitly restricts it to the original grantees. Accordingly, the statute

requires us to construe the ROFR as running with the land, not as a restriction on

alienation personal to the original grantees.

         [¶24] Having reached this point in the analysis, we apply the rule against

perpetuities and conclude that the ROFR does not comply because, as we

determined in Low, 629 A.2d at 58-59, it is an interest in land that will not

necessarily be exercised (“vest”) within a life in being plus twenty-one years.

Because its exercise is unrelated to any person’s lifetime, the ROFR could

theoretically languish for decades or longer before being triggered by Pew’s heirs

or the Cooke Trust deciding to sell their interests in Mouse Island. For that reason,

the ROFR in the Pew and Cooke deeds is void. See id. at 59 (holding that a right

of first refusal violated the rule against perpetuities because it “is clear on its face

that it is intended to apply not only to the original parties to the contract, but also to

all of their heirs and assigns”).

B.       Right of First Refusal: Contract

         [¶25] Concerning these parties, however, the ROFR is separately binding as

a matter of contract law.4 No party contests the applicability of the AOP contract,

     4
     The perpetuities problem just discussed is not presented in an analysis of the parties’ contractual
agreements. As stated by one learned treatise,
                                                                                                   13

in which each of them “reaffirm[ed] the covenants in their deeds respecting the

right of first refusal accorded individual property co-tenants or Island co-tenants.”

Pew was a signatory to the AOP, and the Cooke Trustees, although not signatories,

do not contest the trial court’s factual finding that they intended to be bound by it.

Demonstrating that intent, Cooke voiced no objection when the trial court inserted

the ROFR covenant referenced by the AOP into the Cooke deed. It is clear that

until the present dispute arose, these parties and their predecessors intended to be

bound by the contractual provisions of the AOP, including its incorporation of the

explicit language of the ROFR.                See Barr v. Dyke, 2012 ME 108, ¶ 13,

49 A.3d 1280.

       [¶26] In addition to the AOP, Pew, as an original owner, was also a party to

the Letter of Agreement, specifying that “it is agreed that, if any owners wish to

dispose of [their] interest, that interest will first be offered to the Other Owners to

provide them with the opportunity first to purchase the interest”; the Purchase and

Sale Agreement, signed by the original buyers, in which the seller agreed to insert

       [c]ontracts are normally excluded from the necessity of complying with the rule against
       perpetuities. From a remoteness viewpoint, transactions purely contractual do not
       involve future interests in specific property; hence there can be no problem at all of
       remote vesting. From a more realistic viewpoint, no fettering of specific property can be
       created by a transaction exclusively contractual in character, such as a right of first
       refusal.

10 Richard R. Powell & Michael Allan Wolf, Powell on Real Property § 72.07 (2015).
14

in each of the buyer’s deeds, including Pew’s, the ROFR that now appears there;

and the conveyance to Pew of the deed containing the ROFR.

C.    Waiver of Right to Partition

      [¶27] Having concluded that Pew and Cooke are bound by the ROFR as a

matter of contract law, we turn to the question of whether that preemptive right

acts as a waiver of their right to partition. The trial court granted the Other Owners

summary judgment after concluding that Pew and Cooke had, through their

acceptance of a ROFR, implicitly waived their right to an equitable partition of the

parties’ undivided interests in Mouse Island. We review the entry of a summary

judgment de novo.        Remmel v. City of Portland, 2014 ME 114, ¶ 11,

102 A.3d 1168. Partition of jointly-held property is a flexible procedure available

through the equity jurisdiction of the Superior Court. 14 M.R.S. § 6051(7) (2014);

Murphy v. Daley, 582 A.2d 1212, 1213 (Me. 1990). “The trial court’s equity

power is broad and flexible, and is reviewed on appeal for an abuse of discretion.”

Withee v. Garnett, 1998 ME 30, ¶ 4, 705 A.2d 1119.

      [¶28] In general, tenants in common have a right to have their undivided

interest in land partitioned.     Wood v. Little, 35 Me. 107, 110-11 (1853).

Nonetheless, in Matthews v. Matthews, a case in which the plaintiff agreed to allow

his ex-wife to live in the jointly-owned marital home for “as long as [she]

desire[s],” we implicitly recognized that a co-tenant may voluntarily limit or waive
                                                                                                             15

his or her right to partition. 2008 ME 66, ¶¶ 2, 5, 945 A.2d 1230. Notwithstanding

the unequivocal declaration of the right to partition in Wood,5 we affirmed the

Superior Court’s finding that “[the plaintiff] cannot partition the property . . .

unless or until [his ex-wife] chooses to sell the property or buy him out.”

Id. ¶¶ 4, 6.

        [¶29]      Consistent with Matthews, the Restatement (Second) of Property

states a black-letter rule: “A restraint on the power of a co-tenant to compel

partition, created to last for a reasonable time only, is valid.”6                             Restatement

(Second) of Prop.: Donative Transfers § 4.5 (Am. Law Inst. 1983).7 The reporter’s

note explains that

        [a]greements among co-tenants that each shall have rights of first
        refusal should the other desire to sell his interest have been construed
        as implying enforceable covenants not to sue for partition. Such
        options, like other contract rights, are usually personal to the optionee
        and may not be binding upon his successors in interest.

Id. § 4.5 reporter’s note 2(c)(3). Such is the case here, where we have determined

that the ROFR is binding only on those parties who specifically agreed to it, and

   5
    “The law gives tenants in common an absolute right to have their lands divided.” Wood v. Little,
35 Me. 107, 111 (1853).
   6
      Powell on Real Property reports that restraints on the right to partition have been found reasonable
in several states if the restriction is time limited in some manner. 10 Richard R. Powell & Michael Allan
Wolf, Powell on Real Property § 77.08 (2015). Powell goes on to say that “[a]ny attempted restraint on
partition that lacks a time restriction is likely to be found invalid.” Id. The time restriction in this case is
metabolic—the lifetimes of the owners who agreed to the AOP, assuming they do not sell their interest.
   7
     The Restatement (Third) of Property did not supersede this provision of the Restatement (Second).
Restatement (Third) of Prop: Wills and Other Donative Transfers, vol. 3, app. (Am. Law Inst. 2011).
16

not on those who may in the future take an interest in Mouse Island by deed

transfer without accepting separate contractual restrictions.

      [¶30] Accordingly, the ROFR, binding on Pew and Cooke, acts to waive

their right to partition if that was an intended effect of their agreement with the

Other Owners. We conclude that it was an intended effect because the ROFR

would necessarily be extinguished by the partition that Pew and Cooke seek; in

that event no holder of the ROFR could purchase Pew or Cooke’s undivided

interest, which is the opportunity that the ROFR guarantees the Other Owners,

because Pew and Cooke’s formerly undivided interest would have then been

partitioned into solely-owned parcels, and so their undivided interests would no

longer exist.

      [¶31] Furthermore, as the trial court noted, even if a partitioned solely

owned interest were offered first to the Other Owners, they would no longer have

the opportunity to purchase it at the market rate for an undivided, commonly held

interest—the specific opportunity that the ROFR establishes. A partition would

result in a parcel solely owned by Pew, and possibly another solely owned by

Cooke. The court observed that

      Pew argues expressly that she seeks partition in part to enhance the
      market value of her interest, contending that it will be more difficult
      to sell an undivided fractional interest in land that is also owned
      commonly by others, as compared to selling a parcel free and clear of
      someone else’s ownership claim, and that the value of a separate
                                                                                      17

      parcel is greater than a[n] ownership position held jointly with others.
      Consequently . . . if Pew were prepared to sell that partitioned
      property to a third-party, the non-selling tenants would end up paying
      a higher price to exercise their right of first refusal than they would
      under the present ownership arrangement. But they would end up
      with the same interest that they would have acquired in the absence of
      partition.

The same rationale applies to Cooke’s request for a solely owned parcel. Pew and

Cooke themselves asserted in their statement of facts that “[i]n the opinion of the

Pews and [] Cooke as owners of Mouse Island, the right of first refusal and

ownership scheme significantly devalue their ownership interests.”

      [¶32] Finally, as further evidence that the ROFR was part of a plan designed

to maintain the status quo on Mouse Island, the AOP affirmed the owners’

“intention that the Island be maintained essentially as it is today,” and it instituted a

system requiring a two-thirds majority vote in order to make any significant

change to the way of life that the parties were purchasing an interest in. If Pew and

Cooke were allowed to partition the island into separately-owned lots, the Other

Owners would no longer be guaranteed the right to enjoy the entirety of the island

at will as they have for more than thirty years because Pew and Cooke could

restrict access to their separately-owned lots. We conclude that the ROFR is part

of a contractual mechanism specific to the signatories of the original agreement

and, by their implicit acceptance, the Hinckses and the Cooke Trustees, intended to

prevent such a significant limitation on their use of the common areas of the island.
18

         [¶33] For these reasons, we hold that by accepting the ROFR, Pew and

Cooke waived their right to partition.8 The contractual limitation on their ability to

sell their interests in their property to third parties established by the ROFR, and

the waiver of equitable partition associated with that contractual limitation,

produce a simple result: each of these parties is, pursuant to the AOP, bound to

offer to sell his or her interest in his or her property to the others before conveying

to third parties at the same sale price. If property is ultimately conveyed to a third

party after (1) an opportunity to purchase at the same price is declined by the Other

Owners, (2) the property is inherited as the result of the death of a party bound by

the AOP, (3) the ROFR is extinguished by a two-thirds vote of the parties

according to the AOP, or (4) ownership has otherwise changed according to law,

the subsequent owner is not bound by the ROFR established in the AOP.9

D.       The Caretaker

         [¶34] Pew and Cooke contend that the AOP does not require that the owners

employ a caretaker in general, or the current caretaker in particular. We review the

     8
       Other courts have recognized that by executing a ROFR, co-tenants may waive their right to
partition.   See Libeau v. Fox, 892 A.2d 1068, 1071 (Del. 2006); LEG Invs. v. Boxler,
107 Cal. Rptr. 3d 519, 525 (Cal. Ct. App. 2010).
     9
      A new owner of an undivided interest may wish to join the mutual covenants established in the AOP
that the original owners exchanged in order to maintain the island’s exclusive circle of ownership.
Concerning the parties to this action, the Superior Court expressly found that “[a]lthough [Torrey] Cooke
[as trustee] and the Hinckses acquired their ownership interest after the original owners signed the AOP,
they considered themselves to be bound by it. The court therefore treats all of the present owners as
parties to the agreement.” Cooke does not challenge this finding on appeal.
                                                                                  19

interpretation of a contract and the question of whether it is ambiguous de novo.

Flaherty v. Muther, 2013 ME 39, ¶ 17, 65 A.3d 1209. If the contract is ambiguous,

“its interpretation is a question of fact for the factfinder.” Id. (quotation marks

omitted). The question of whether a breach of the AOP occurred is also a finding

of fact reviewed for clear error.         Coastal Ventures v. Alsham Plaza, LLC,

2010 ME 63, ¶ 20, 1 A.3d 416.

      [¶35] The trial court did not err in concluding that the AOP is ambiguous

concerning the question of whether it requires the employment of a full-time

caretaker. In the AOP, the owners agreed that their intent was “that the Island be

maintained essentially as it is today”; to that end, they agreed that penalties would

be imposed on any owner who “fail[ed] to pay his/her appropriate share of

expenses.”    The AOP does not, however, specify the expenses that are

“appropriate.” For that reason the court appropriately looked to extrinsic evidence

of the parties’ intent, see id. ¶ 27, in this case the August 21, 1978, letter of

agreement that it determined was the foundation for the later AOP.

      [¶36] The letter states, in part:

      [Nickles, Pew, and Sayler] understand[] that the caretaker is receiving
      $700 a month plus payment for utilities. [They] agree[] that the
      caretaker should continue in his position and receive the same
      monthly payments.

      ....
20

      It is agreed that an association of owners will be created to collect
      assessments from the owners for payment of the caretaker’s salary,
      real estate taxes, and general maintenance. These assessments will be
      divided equally among the three principal houses . . . . Each of the
      parties understands that in situations where the caretaker must call in
      outside assistance to work on a project affecting only a particular
      house, the owner of that house will pay for the outside assistance.
      Work done by the caretaker on common Island property, such as the
      sea wall, studio, tennis courts, etc., will be shared by all owners.
      Further, it is understood that the caretaker’s work on each of the
      homes on the Island will not change the basi[c] intention of the
      parties to share equally the caretaker’s salary and benefits.

(Emphasis added.)

      [¶37] The letter makes clear that the cost of a caretaker was an accepted

expense to be commonly shared. As further support, the court found that the

owners had employed a full-time caretaker for over thirty years, including the

current caretaker for more than ten years, and had, by each paying their full share

of the cost until 2010, recognized the caretaker position to be a necessary expense.

As late as 2009, Pew and Cooke agreed to give the current caretaker a $3,000 raise.

For these reasons, the court did not err in finding that “all of the owners are jointly

liable for the expenses arising from [the caretaker].”

      [¶38] Moreover, the court did not err in finding that the AOP prevented Pew

and Cooke from unilaterally changing the caretaking arrangement—i.e., by firing

the caretaker—by withholding their share of that cost. The court found that any

such change would constitute a significant change affecting the island pursuant to
                                                                                     21

the AOP, and thus required a two-thirds vote before it could be implemented.

Given the parties’ long-standing agreements and decades-long course of dealing,

the court’s conclusion is well supported.

      [¶39] Pew and Cooke also assert that they have a common law right to

discharge an at-will employee, and that the caretaker is employed pursuant to a

contract of indefinite duration that is terminable at will. See Burnell v. Town of

Kingfield, 686 A.2d 1072, 1073 (Me. 1996) (“It is well settled that a contract of

employment for an indefinite length of time is terminable at will by either party.”

(quotation marks omitted)). The flaw in their argument lies in the answer to the

question of who can exercise that right.         Pursuant to the AOP, the owners

collectively can, by two-thirds vote, fire the caretaker at will. Pew and Cooke

cannot do so as individual owners in a manner inconsistent with the AOP.

E.    Other Commonly-Shared Expenses

      [¶40] Pew and Cooke finally argue that the court erred in finding them

liable for a share of certain island expenses after trial. “An award of damages will

not be disturbed unless there is no basis in the record to support it.” Jenkins, Inc. v.

Walsh Bros., Inc., 2001 ME 98, ¶ 18, 776 A.2d 1229 (quotation marks omitted).

Pew and Cooke do not challenge the court’s calculation of amounts expended, only

its classification of some expenses as commonly-shared.
22

        [¶41] The court painstakingly parsed the expenses claimed by the Other

Owners, finding some to be allowable commonly-shared expenses, while

disallowing others.          It carefully distinguished between the two categories by

examining the AOP; the August 21, 1978, letter of agreement; and the owners’

common practice through the years. Because there is a basis in the record to

support the court’s approach, we will not disturb its damages award. See id.

        The entry is:

                           Judgment affirmed.

On the briefs:

        James T. Kilbreth, Esq., and Adrianne E. Fouts, Esq.,
        Drummond Woodsum, Portland, for appellants Sally C. Pew
        and the Trustees of the John P. Cooke Disclaimer Trust

        Deborah M. Mann, Esq., and Tudor N. Goldsmith, Esq., Jensen
        Baird Gardner & Henry, Portland, for appellees Robert and
        Martha Sayler, John and Marcia Hincks, and Peter and Maria
        Nickles

At oral argument:

        James T. Kilbreth, Esq., for appellants Sally C. Pew and the
        Trustees of the John P. Cooke Disclaimer Trust

        Deborah M. Mann, Esq., for appellees Robert and Martha
        Sayler, John and Marcia Hincks, and Peter and Maria Nickles

Lincoln County Superior Court docket number CV-2011-31
FOR CLERK REFERENCE ONLY