Court Opinion

ID: 9615957
Source: CourtListenerOpinion
Date Created: 2023-08-22 04:42:08.106986+00
Date Added: 2024-06-11T18:03:53.959678
License: Public Domain

*70ELMORE, Judge
dissenting.
In the narrowest of terms, the disagreement between these parties is how to interpret the phrase: “Respondent shall have all other rights to said strip of land not inconsistent with the rights and easements herein contained[.]” Broadly speaking, this appeal highlights the tension between contract law and property law. While I agree that consent judgments are foremost contracts, I do not agree that interpreting one dealing with property rights arising from a utility easement means we should ignore general concepts of property law known to the parties at the time of contracting and instead narrowly favor one clause of the contract over another.
Duke Energy Corporation (Duke) holds title to a utility easement across land owned and developed by Wendell Corey Malcolm and Callabridge/Granite L.L.C. (Callabridge) located on Highway 16 at the intersection of State Highway 16 and Mount-Holly Huntersville Road in Charlotte. Callabridge developed the land into a shopping center complex and constructed a concrete and stone “Callabridge Landing” sign and “pole and single wire fence” on the easement. The sign is about four feet high by thirty feet long and is located approximately sixty feet away from the nearest piece of Duke equipment. The fence, Callabridge contends, is necessary for the property to comply with transportation regulations. Callabridge also planted several trees on the easement. Duke contends all these items violate its easement right to keep the land clear of any structures, trees, and objects.
The majority isolates this easement right and determines that it is unambiguous. Thus, when it arrives at the phrase which leaves the landowner with “all other rights to said strip of land not inconsistent with” Duke’s rights, the majority concludes “the reserved rights are restricted by the enumerated rights granted to the dominant tenant in accordance with the easement.” As such, the majority holds that “the defendant’s use of the land, i.e. the planting of trees and placement of other structures within the dimensions of the easement, is necessarily inconsistent with the enumerated right of the power company to keep the land clear of such trees and structures.” Further, the majority discounts the latter half of the easement agreement — the enumerated prohibitions on the landowner’s exercise of rights — that I believe refines the understanding and intent among the parties. “[T]he reserved rights provision,” the majority states, “specifically prohibits the defendants from taking any action which is incompatible with the express right of the plaintiff to ‘[a]t any time to clear said strip and to *71keep said strip clear of any and all structures, trees, fire hazards and other objects of any nature.’ ”
This flawed analysis leads to only one misplaced conclusion: since Duke has the right to clear the strip and keep it clear at all times, there is no limitation or review of its right to effectively occupy, or otherwise exclude occupancy, of the entire surface of the easement.1 Much to the contrary, however, Duke’s “right to clear” is intertwined with its ability to transmit electricity and protect its equipment, such that if Callabridge’s use of the land does not materially interfere with Duke’s purpose in maintaining the easement, then it should be permitted. This understanding is conveyed by reviewing the easement as a whole, not its isolated parts.
The controlling purpose of the court in construing a contract is to ascertain the intention of the parties as of the time the contract was made, and to do this consideration must be given to the purpose to be accomplished, the subject-matter of the contract, and the situation of the parties. . . . The intention of the parties is to be gathered from the entire instrument and not from detached portions. ... An excerpt from a contract must be interpreted in context with the rest of the agreement. . . . When the language of a contract is clear and unambiguous, effect must be given to its terms, and the court, under the guise of constructions, cannot reject what the parties inserted or insert what the parties elected to omit.
Weyerhaeuser Co. v. Light Co., 257 N.C. 717, 719, 127 S.E.2d 539, 541 (1962) (internal citations omitted).
The 1977 consent judgment between Duke Power Company and Dunn Development Corporation, predecessors in interest to Duke and Callabridge respectively, stated:
There is hereby condemned and granted from the respondent, Dunn Development Corporation, to Duke Power Company, its successors and assigns, and Duke Power Company is declared to be the owner of, the property interest which is the subject of this proceeding: the easement rights being described in Exhibit “A”, the property and strip easement being described in Exhibit “B”, and a plat of the property and strip easement being shown on *72Exhibit “C”, all of such exhibits being attached hereto and incorporated as a part of this judgment.
Exhibit “A” memorialized the fact that the parties agreed to give the following rights to Duke Power.
The right to enter said strip of land . . . and the right, within the limits of said strip of land to erect, construct, reconstruct, replace, maintain and use towers, poles, wires, lines, cables, and all necessary and proper foundations, footings, crossarms and other appliances and fixtures for the purpose of transmitting electric power and for [Duke’s] communication purposes, together with a right of way on, along, and in all of the said strip of land; together with the right for [Duke] at any time to make relocations, changes, renewals, substitutions, and additions on or to said structures within said strip; the right for [Duke] at any time to clear said strip and keep said strip clear of any and all structures, trees, fire hazards and other objects of any nature[.]
Duke also acquired the right to trim and cut trees outside of the easement that might endanger its equipment, as well as the right of ingress and egress from the easement.
None of Duke’s acquired rights are absolute, however. Indeed, they are tempered by those rights reserved by Callabridge, the landowner.
[Callabridge] shall have all other rights to said strip of land not inconsistent with the rights and easements herein contained, but [Callabridge] cannot: (1) construct streets, roads, water lines or sewer lines across said strip at an angle of less than forty-five (45) degrees . . . nor closer than 20 feet to any structures placed upon the right of way by [Duke] ... (2) maintain fences that are not safely removed from [Duke’s] structures ... (3) dig wells on said strip; (4) place . . . underground storage tanks on said strip; (5) use said strip for burial grounds; (6) interfere with or endanger the construction, operation, or maintenance of [Duke’s] facilities.
The judgment at issue did indeed give Duke the right to clear “structures, trees, fire hazards and other objects of any nature” and keep the easement clear. And at first blush, Duke’s argument that Callabridge could use the land in any manner that did not involve placing a structure or object on the land seems valid, albeit severely *73limiting. But to look at this part of the easement in isolation, giving it greater weight to the exclusion of other parts, would be incorrect. Weyerhaeuser Co., 257 N.C. at 719, 127 S.E.2d at 541.
Callabridge’s retained right to use the strip of land is subject to six specifically enumerated prohibitions; five of the six restrict Callabridge from placing structures or objects on the easement, such as streets, fences, and underground storage tanks. Implicitly then, if Duke’s “right to clear” were as broad and definite as it contends, these enumerated prohibitions that curtail Callabridge’s use of the easement would be superfluous. For example, Duke maintains the fence placed by Callabridge must be removed because it is an object on the easement, not because the fence may not be “safely removed” from its equipment — a specific prohibition on Callabridge’s rights. Duke ignores the prohibitions or otherwise minimizes their influence on the parties’ intent in the easement agreement. This type of imbalanced interpretation is contrary to our rules of construction and would actually defeat the parties’ intent.
A contract must be construed as a whole, and the intention of the parties is to be collected from the entire instrument and not from detached portions, it being necessary to consider all of its parts in order to determine the meaning of any particular part as well as of the whole. Individual clauses in an agreement and particular words must be considered in connection with the rest of the agreement, and all parts of the writing, and every word in it, will, if possible, be given effect.
Robbins v. Trading Post, 253 N.C. 474, 477, 117 S.E.2d 438, 440-41 (1960) (emphasis added) (internal quotation omitted).
Throughout this litigation one question has gone unanswered, and is the gravamen of the case: what rights does Callabridge have to its land encumbered by the easement? Duke’s answer is that the rights retained by Callabridge, whatever those may be, cannot involve placing any structure or object of any nature on the easement. Callabridge responds that it has the right to use the easement in any manner that does not interfere with Duke’s use. I agree with the majority that the “right to clear” within the easement is unambiguous; however, that phrase’s effect on the balance of rights within the easement as a whole is where I disagree. The fact that the landowner’s retained rights are couched in terminology that provides the maximum allowable breadth when dealing with a utility easement makes me hesitant to restrict them unnecessarily.
*74To me, the parties’ respective rights are better focused by viewing the whole contract through the lens of our case law regarding easements. At the summary judgment hearing and on appeal, Duke argues interpretation of this contract is controlled by Hanner v. Power Co., 34 N.C. App. 737, 239 S.E.2d 594 (1977), and Callabridge argues that Power Company v. Rogers, 271 N.C. 318, 156 S.E.2d 244 (1967), controls. These cases do involve interpretation of the contract rights between an easement holder and a landowner, but to properly resolve this issue, one must look further than these two cases.
In Light Company v. Bowman, 229 N.C. 682, 51 S.E.2d 191 (1949), our Supreme Court addressed the rights of a landowner that had constructed a large building on an easement granted to the utility company. The power company had obtained an easement by consent judgment that provided it with the right to construct' and maintain power lines across defendant’s land. The power company also had the right to clear trees or objects-from in and around the easement that might fall on the electrical wires. Notably the power company limited its rights by stating “except for the purpose aforesaid,' [which was the transmission of electricity and phones] petitioner shall not interfere with the rights of the defendants[.]” Id. at 684, 51 S.E.2d at 193. Thus, the landowner retained the right to use the land within the easement “for any and all purposes not inconsistent with said easement of petitioner, its successors and assigns.” Id. Specifically enumerated as a valid use was that “defendants and their heirs and assigns shall have the right and privilege to use a portion of the land condemned in this proceeding for agricultural purposes when not necessary for the use of the plaintiff.” Id.
The power company had requested jury instructions that asked the jury to determine whether the building’s location and size was a “use of the land inconsistent with the easement.” Id. at 686, 51 S.E.2d at 194. The Supreme Court agreed that instruction should have been given.
To draw a definite line between the reciprocal and oftentimes overlapping rights and obligations of the owners of the dominant and serviént tenements in an easement is not always simple. But the general rule in regard to land condemned for use for electric power transmission lines seems to be that the landowner has the right to make use of the strip of land condemned in any manner which does not conflict with the rights of the Power Company, and which is not inconsistent with the use of the land for the pur*75poses for which condemnation was allowed, and which does not interfere with the free exercise of the easement acquired.
Id. at 687, 51 S.E.2d at 195 (citations omitted). Evaluating the competing interests, however, the Court stated it would be an “unwise precedent” to leave a power company without remedy to prevent construction or otherwise remove a “permanent building of the size, height, and dimensions shown.” Id. at 690, 51 S.E.2d at 197. As such, the Court held that where
the electric power company has erected steel towers and strung therefrom its wires carrying powerful electric current over and upon such strip of land for the purposes ... declared, the servient owner may not be permitted, against its protest and over its objection, to erect and maintain a large permanent building, covering almost the entire width of the right of way and extending upward within a few feet of the power charged wires, and that if these facts are properly made to appear from the evidence, this would constitute a use by the landowner inconsistent with the easement and an encroachment on the rights acquired.
Id. at 689, 51 S.E.2d at 196.
In United States v. Sea Gate, Inc., 397 F. Supp. 1351 (D.N.C. 1975), the federal district court summarized Bowman and stated the general rule regarding a landowner’s use of an easement hinges on whether that use “obstructs or materially impairs the easement holder’s use and enjoyment of his rights under the easement.” Id. at 1358. A material impairment can be any use that generates an inconvenience, creates a safety hazard, or increases the cost of the easement holder’s exercise of their rights. Id.) see also 1 Patrick Hetrick & James McLaughlin, Jr., Webster’s Real Estate Law in North Carolina § 15-23 (5th ed. 1999) (adopting general rule). Accordingly, the court in Sea Gate found that unchecked home construction within an easement owned by the Government on either side of the Atlantic Intercoastal Waterway created a material impairment to the rights given to the Government under the easement. But, the Court held that building homes only on one side of the waterway, and in further specified areas, would not materially impair the rights of the easement holder and therefore would be allowed. Id. at 1359.
The Court today dismisses the general rule of material impairment on the grounds that the parties’ rights expressed in the consent judgment are unambiguous; in other words, the parties intended to contract against that general rule. As such, there is no room for appli*76cation of general principles, only contractual interpretation. However, the overall language of this consent judgment expresses a balance of rights wholly consistent with the general rule.
In Rogers the Supreme Court reviewed an easement remarkably similar to the easement in dispute here, and assessed the parties’ rights under the general rule. The consent judgment between the parties there allowed the power company to construct and maintain electric transmission lines over the land as well as “the right to keep the right-of-way clear of all structures, trees, fire hazards, and other natural objects of any nature[.]” Rogers, 271 N.C. at 318, 156 S.E.2d at 245. These rights acquired by the power company were limited by the retained rights of the landowner, which included “all other rights to said strip of land not inconsistent with the rights and prohibitions herein contained[.]” Id. at 319, 156 S.E.2d at 246.
The Rogers court determined that the trial court erred by instructing the jury that the easement’s value was to be calculated by determining the condemned land’s full value, as if taken in fee.
Petitioner does not acquire the right to occupy the surface of the 0.93-acre right-of-way to the total exclusion of respondents. It is condemning only an easement; respondents retain the fee in the land. Subject to the prohibitions specifically enumerated in the petition, they may make any use of the surface of the strip which will not interfere with petitioner’s transmission of electricity. Carolina Power and Light Co. v. Bowman, 229 N.C. 682, 51 S.E.2d 191 [(1949)]. Necessarily, that use will be limited; but it cannot be said that the right to use it and to traverse it freely has no value to them.
Id. at 320, 156 S.E.2d at 247 (italicized emphasis in original, bold emphasis added). The Court stated that the trial court instructed the jury as if the easement granted to the power company had been the right to build a road or railroad “in which the bare fee remaining in the landowner, for all practical purposes, has no value to him and the value of the easement is virtually the value of the land it embraces.” Id. at 321, 156 S.E.2d at 247.
This general rule — that interference is the guiding principle in determining a landowner’s use of a power company’s easement— expressed in Bowman, Sea Gate, and Rogers has not been materially modified over time. See Falkson v. Clayton Land Corp., 174 N.C. App. 616, 617, 621 S.E.2d 215, 216-17 (2005) (citing Bowman as gen*77eral rule). Thus, I see no reason to view Duke and Callabridge’s easement any differently than the Supreme Court saw an almost identical balance of rights nearly ten years before these parties’ predecessors entered into their markedly similar agreement. Duke’s right to “at any time to clear said strip and keep said strip clear of any and all structures, trees, fire hazards and other objects of any nature,” is not materially different than the power company’s right in Rogers “to keep the right-of-way clear of all structures, trees, fire hazards, and other natural objects of any nature[.]” Rogers, 271 N.C. at 318, 156 S.E.2d at 245. And both Callabridge and the landowner in Rogers retained the substantial right to “all other rights to said strip of land not inconsistent with the rights and prohibitions herein contained[.]” Id. at 319, 156 S.E.2d at 246. Thus, to read Duke’s right to keep the strip clear of any structures as the right to exclusively and continually possess the surface would extend to Duke a right greater than Callabridge’s predecessors in interest agreed to. In opposition to the balance struck by the Bowman court, the Court today sets an unwise precedent that leaves landowners with no remedy against an overzealous exercise of disjunctive .easement rights by the dominant tenement. The appropriate balance, when called for in agreements such as the one sub judice, is whether the landowner’s use of the easement materially impairs the set of rights given to the utility company.
Hanner did not need to apply a general rule to strike the appropriate balance of rights between the parties because, unlike Rogers and here, the parties unambiguously agreed within the contract that the landowners retained rights were severely limited. Specifically included in the easement rights conveyed to the power company was indeed the right “to keep said strip of land free and clear of any or all structures, trees and other objects of any nature except those placed in or upon same by the Power Company[.]” Hanner, 34 N.C. App. at 737, 239 S.E.2d at 595. Importantly, however, the specific rights retained by the landowner were not all those inconsistent with the power company’s use of the easement, but instead “that the grantor(s) may use said strip of land for growing such crops and maintaining such fences as may not interfere with the use of said right of way by the Power Company for the purposes here-inabove [sic] mentioned.” Id. at 738, 239 S.E.2d at 595. Thus the landowners had to take the nearly indefensible position that their trees were “crops.”2
*78The contract specifically gave defendant the right to clear trees from the right-of-way, and plaintiffs’ right to grow “crops” was specifically limited by this provision. By the terms of the contract, defendant did not, by agreeing at various times to allow trees to remain, waive its right as stated in the contract.
Id. at 738-39, 239 S.E.2d at 595. The Court found the appropriate intent of the parties by looking no further than the contract’s language; the landowner had not reserved all rights not inconsistent with the easement holder’s rights, but merely the right to grow crops. Accordingly, Hanner is not applicable here.
Application of these principles to the agreement at bar fail to support a judgment in favor of Duke as a matter of law. By viewing the right to clear the land in context of the whole agreement, and our case law, the balance of rights the parties intended is consistent with Callabridge’s assessment. Thus, I would reverse the trial court’s order of summary judgment in favor of Duke. Moreover, since neither party disputes the fact that the current objects do not create a safety hazard, generate an inconvenience, or increase the cost to Duke of exercising its rights under the easement,3 then I would hold the trial court erred by not granting summary judgment in favor of Callabridge.

. The majority itself, although holding as such, is apparently nonetheless troubled by it. The Court holds that the trial court erred in allowing Duke to have a permanent injunction restricting Callabridge from placing any structure whatsoever on the easement. But that result is precisely what the Court’s holding provides to Duke.

. The Hanner court did not hold that the power company’s right to clear was unambiguous, as a matter of law, and controls in every circumstance; rather, the Hanner court held that “crops,” as a matter of law, was unambiguous.

. Callabridge concedes that if the current objects ever do materially interfere with Duke’s rights to transmit electricity, Duke has the authority under the consent judgment to immediately remove them.