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2008-UP-153 - Portside Owners Association, Inc. v. South Beach Racquet Club, Inc.

THIS OPINION HAS NO PRECEDENTIAL VALUE.  IT SHOULD NOT BE CITED OR RELIED ON AS PRECEDENT IN ANY PROCEEDING EXCEPT AS PROVIDED BY RULE 239(d)(2), SCACR.

THE STATE OF SOUTH CAROLINA
In The Court of Appeals


Portside Owners Association, Inc., Appellant,

v.

South Beach Racquet Club, Inc., Respondent.


Appeal From Beaufort County
Curtis L. Coltrane, Circuit Court Judge


Unpublished Opinion No. 2008-UP-153
Submitted January 1, 2008 – Filed March 11, 2008


AFFIRMED


Roberts  Vaux, of Bluffton; for Appellant.

Drew A. Laughlin, of Hilton Head Island; for Respondent.

PER CURIAM:  Portside Owners Association, Inc. (Portside) filed this action against South Beach Racquet Club, Inc. (South Beach), seeking a determination of the parties’ rights to a tract of real property.  South Beach prevailed at trial, and Portside appeals.  We affirm. [1]

FACTS

In 1985, Charles Fraser created three corporations known as Beachside-Portside, Inc. (Beachside), Portside, and South Beach.  On September 29, 1986, Fraser conveyed six building lots, a common area, and a 50' access easement (the 50' Tract) to Beachside.

On September 30, 1986, Beachside recorded a Declaration of Covenants, Conditions and Restrictions for the six lots, common area, and 50' Tract comprising Portside Subdivision.  The covenants granted to the Portside homeowners the right to transfer interests in the common area.  In the covenants, Beachside reserved to itself a right to exercise the powers granted to Portside without the Portside owners’ consent.  However, this right expired if Beachside no longer owned at least two of the six lots.  By December 30, 1986, Beachside had conveyed all six of the residential lots to third parties.

In 1987 or 1988, South Beach prepared to build four tennis courts.  At the time, Fraser possessed a controlling interest in South Beach.  On May 26, 1987, Fraser, as president and on behalf of Beachside, wrote a letter to South Beach acknowledging and consenting to encroachment of the tennis courts into the 50' Tract (the Encroachment Letter).  The courts were built by 1988 and encroached into the 50' Tract.

On May 14, 1992, Beachside conveyed “a perpetual, non-exclusive Easement and right-of-way for ingress and egress on, over and across the [50' Tract]” to South Beach in an “Access Easement” (the Easement).  The Easement was recorded on October 30, 1992.  In addition to the rights of ingress and egress, the Easement stated South Beach “shall have the right to maintain such portions thereof as Grantee is presently maintaining for use as parking and landscaped areas, including the right, at the sole cost and expense of Grantee, to install such paving, curbing, drainage and irrigation facilities, and other similar or related improvements as Grantee shall require.”

Beachside conveyed the 50' Tract to Portside in a quit-claim deed, dated May 1, 1992, and recorded on November 6, 1992.  The deed states on its face that it is subject to “an easement for ingress and egress and parking reserved to South Beach Racquet Club, Inc. in that certain document entitled Access Easement, dated May 14, 1992, by and between Grantor and South Beach Racquet Club, Inc.”

Approximately twelve years later, Portside filed this action on February 20, 2004, alleging the Easement and Encroachment Letter are invalid, thus South Beach’s use of the Tract constitutes trespass.  Portside also sought declaratory relief.  The trial court found if Portside’s action against South Beach’s use of the Tract is based on a breach of covenants, it is barred by the three year statute of limitations.  The trial court further found if the action is characterized as one for the recovery of real property, it is barred by the ten year statute of limitations for the recovery of real property.  The trial court also found, with respect to the tennis court encroachments, South Beach proved its claim for adverse possession.  Portside appeals.   

STANDARD OF REVIEW

“A suit for declaratory judgment is neither legal nor equitable, but is determined by the nature of the underlying issue.  An issue, essentially one at law, will not be transformed into one in equity simply because declaratory relief is sought.”  Felts v. Richland County, 303 S.C. 354, 356, 400 S.E.2d 781, 782 (1991).  The character of an action as legal or equitable is determined by the main purpose of the complaint, the nature of the issues as raised by the pleadings or the pleadings and proof, and the character of the relief sought under them.  Ins. Fin. Servs., Inc. v. S.C. Ins. Co., 271 S.C. 289, 293, 247 S.E.2d 315, 318 (1978).

The issue of title is legal in nature. Getsinger v. Midlands Orthopaedic Profit Sharing Plan, 327 S.C. 424, 428, 489 S.E.2d 223, 224 (Ct. App. 1997). “An action brought for the primary purpose of determining title to a disputed land is in the nature of a trespass action to try title, which is an action at law.”  Watson v. Suggs, 313 S.C. 291, 293, 437 S.E.2d 172, 173 (Ct. App. 1993).  An adverse possession claim is an action at law.  Clark v. Hargrave, 323 S.C. 84, 87, 473 S.E.2d 474, 476 (Ct. App. 1996).

In an action at law, on appeal of a case tried without a jury, we may not disturb the circuit court’s findings of fact unless they are unsupported by the evidence or controlled by error of law.  Auto Owners Ins. Co. v. Langford, 330 S.C. 578, 581, 500 S.E.2d 496, 498 (Ct. App. 1998). 

LAW/ANALYSIS

I.  The Statutes of Limitations

          Portside initially argues its claims are not barred by the applicable statutes of limitations because it consented to South Beach’s use of the 50' Tract until October 24, 2003, so that the applicable limitation periods for the actions for breach of the covenants and the recovery of real property did not commence until that date.  Thus, Portside argues, the action was initiated within the applicable statutory period of three years for breach of covenants and ten years for the action to recover real property.  See S.C. Code Ann. §§ 15-3-340 & 15-3-530 (2005). 

A. Recovery of Real Property

We find Portside’s action is essentially an action for the recovery of real property and is barred by the ten year statute of limitations.  In determining whether a proceeding is an action for the recovery of real property within the meaning of the statute of limitations, the pleadings as a whole must be considered.  Winn v. Grantham, 263 S.C. 368, 371, 210 S.E.2d 602, 603 (1974).  “The character of an action is not to be determined by the terminology which the pleaders may chance to give to it.”  Walsh v. Evans, 112 S.C. 131, 136, 99 S.E. 546, 548 (1919).  “[W]hen a defendant’s right to property is attacked and in his answer he raises the ‘flag of dominion’ the issue of recovery has been established.”  Winn, 263 S.C. at 372, 210 S.E.2d at 604.    

The gravamen of Portside’s complaint is to remove any cloud on its title in the 50' Tract and affirm its exclusive right to possession of the property.  Portside attacked South Beach’s use of the property as a violation of Portside’s exclusive rights.  As an action for the recovery of real property, the action is governed by section 15-3-340, which states that an action for the recovery of real property may not be maintained “unless it appears that the plaintiff, his ancestor, predecessor, or grantor, was seized or possessed of the premises in question within ten years before the commencement of the action.”  S.C. Code Ann. § 15-3-340 (2005).  Portside commenced this action to recover its exclusive rights in the property by filing its summons and complaint on February 20, 2004.  Therefore, under section 15-3-340, Portside’s action may only be maintained if it was possessed of those exclusive rights to the 50' Tract within ten years of February 20, 2004, i.e., at any time after February 20, 1994. 

South Beach encroached on the property by building tennis courts in 1988 and received the Easement for ingress and egress in 1992, both more than ten years prior to the filing of this action.  To avoid the application of the statute, Portside argues it consented to South Beach’s encroachment and use until 2003.  

B.  Consent

Portside argues it consented to South Beach’s use of the property until October 24, 2003, the date it alleges it revoked its consent and thus, the statute of limitations did not begin to run until that date.  We disagree.   

We find evidence in the record to support the finding that Portside did not consent to South Beach’s use of the 50' Tract.  The circuit court’s order does not specifically state that Portside did not consent.  However, the court stated that Portside “suffered South Beach to use and maintain the encroachments, and to occupy the [50' Tract] in a manner consistent with the written easement for a period of more than ten years prior to bringing this action.”  The South Carolina Rules of Civil Procedure require that “[i]n all actions tried upon the facts without a jury or with an advisory jury, the court shall find the facts specially and state separately its conclusions of law thereon.” Rule 52(a), SCRCP. The rule is directorial in nature so “where a trial court substantially complies with Rule 52(a) and adequately states the basis for the result it reaches, the appellate court should not vacate the trial court’s judgment for lack of an explicit or specific factual finding.”  Noisette v. Ismail, 304 S.C. 56, 57, 403 S.E.2d 122, 123-24 (1991). 

We find substantial compliance by the circuit court in making its findings, and evidence to support the finding that Portside did not consent to the encroachments.  See Kirkland v. Gross, 286 S.C. 193, 198, 332 S.E.2d 546, 549 (Ct. App. 1985), receded from on other grounds by Boyd v. Hyatt, 294 S.C. 360, 364 S.E.2d 478 (Ct. App. 1988) (finding the question of acquiescence in an action for adverse possession is generally a question of fact).  See also Townes Assocs., Ltd. v. City of Greenville, 266 S.C. 81, 86, 221 S.E.2d 773, 775 (1976) (stating appellate court will not disturb factual findings in an action at law tried without a jury unless there is no evidence reasonably supporting the findings).

The only evidence Portside offers as support for its argument that it consented is the October 24, 2003 letter purporting to revoke its consent.  However, there is contradictory evidence.  The 1992 deed from Beachside to Portside referenced the Easement granted to South Beach.  Furthermore, the minutes of Portside’s annual meetings on November 2, 1991, November 7, 1992, October 16, 1993, and October 8, 1994, indicate Portside was aware of potential title problems to the 50' Tract.  The minutes reflect that Portside specifically questioned what other rights any other entity had in the 50' Tract, raised questions regarding South Beach’s responsibilities concerning the property, and sought legal counsel to address these issues.  Portside abandoned these inquiries in 1994.  The minutes of the October 16, 1999 meeting indicate Portside again questioned its title to the property.  The minutes of the October 19, 2002 meeting reflect a discussion of the encroachments and Easement.  Portside’s president admitted the minutes from Portside’s annual meetings reveal no evidence that Portside ever permitted South Beach to use or encroach on the property.  We find evidence to support the conclusion that Portside did not consent to South Beach’s use.  Therefore, we affirm the trial court’s finding that the statute of limitations for the recovery of real property commenced at the time the Easement began to run in 1987 for the encroachments with the Encroachment Letter and in 1992 with the Easement for South Beach’s use of the 50' Tract. 

II.  Adverse Possession

Portside next argues South Beach did not establish the elements of its affirmative defense of adverse possession regarding the tennis court encroachments because South Beach never had exclusive possession of Portside’s property.  Additionally, Portside argues South Beach did not establish that its adverse possession was for the required number of years.  We disagree.

In South Carolina, a party may establish adverse possession after possessing adversely to the owner for ten years.  S.C. Code Ann. § 15-67-210 (2005).  To constitute adverse possession, the possession must be actual, open, notorious, hostile, continuous, and exclusive for the entire statutory period. Mullis v. Winchester, 237 S.C. 487, 491, 118 S.E.2d 61, 63 (1961).  The question of adverse possession is one of fact and only becomes one of law when the evidence is undisputed and susceptible of but one inference.  Lynch v. Lynch, 236 S.C. 612, 622, 115 S.E.2d 301, 306 (1960).  Therefore, our review is limited to determining whether the circuit court’s findings are without evidentiary support or controlled by an error of law.  Auto Owners Ins. Co. v. Langford, 330 S.C. 578, 581, 500 S.E.2d 496, 498 (Ct. App. 1998).

A.  Exclusive Possession

Portside argues South Beach did not establish exclusive possession of Portside’s property because “Portside, as the owner of the entire [50' Tract], and South Beach, as an occupier of the [50' Tract], are both in possession of and share the [50' Tract] in its entirety.”  Additionally, Portside argues “the physical encroachments on the [50' Tract] by South Beach do not prevent the Portside homeowners from their use of the [50' Tract] as a whole.”   

“The general rule is that where an owner of property and an occupier are both in possession, the possession of the legal owner prevails to the exclusion of the other.”  Butler v. Lindsey, 293 S.C. 466, 472, 361 S.E.2d 621, 624 (Ct. App. 1987).  The element of exclusivity required to acquire title by adverse possession is not met if occupancy is shared with the owner.  Id.

However, the trial court did not find South Beach established adverse possession with respect to the entire 50' Tract but merely as to the encroachments.  In support of this finding, the circuit court noted “[s]ince the encroachments actually occupy a portion of the [50' Tract], South Beach’s possession has been actual and exclusive.”  As to the tennis court encroachments, we agree South Beach’s use was not shared with Portside and therefore, met the element of exclusivity.  The encroachments occupy the portions of Portside’s property on which they are built, so that the property may not be used for any other purpose.  In addition, there is testimony in the record stating the tennis courts were fenced in, there was no way to access the tennis courts from the 50' Tract, and they have been in the exclusive possession of South Beach since 1988.  Accordingly, we find no error in the trial court’s finding of exclusivity.     

B. The Statutory Period for Adverse Possession

Portside also argues South Beach did not prove it adversely possessed the property for the required number of years.  Portside argues that because South Beach maintains the Encroachment Letter gave it the right to encroach, the encroachment was not hostile until after Portside revoked consent in 2003.  However, the Encroachment Letter was signed by Fraser on behalf of Beachside, not Portside, and any consent to encroach granted by Beachside is not attributable to Portside as Beachside and Portside are separate corporate entities.  Thus, even if the encroachment is hostile to Beachside, it could be hostile to Portside.  See Hunting v. Elders, 359 S.C. 217, 223, 597 S.E.2d 803, 806 (Ct. App. 2004) (finding corporations are separate entities).  We find evidence in the record to support a finding of hostility as to Portside.

The only evidence in the record is that South Beach’s possession began in 1988 with the construction of the tennis courts.  The statutory period for adverse possession is ten years.  S.C. Code Ann. § 15-67-210 (2005).  Portside attempt to revoke its consent in 2003 and filed this action in 2004.  We agree with the trial court that South Beach established its adverse possession for the statutory period. 

III. Trespass

Portside finally contends the trial court erred in failing to find South Beach’s use of the easement constitutes a continuing trespass because South Beach did not receive a valid grant of an easement.  We disagree.

Trespass is an intentional invasion of the plaintiff’s interest in the exclusive use of his property.  Hedgepath v. Amer. Tel. & Tel. Co., 348 S.C. 340, 357, 559 S.E.2d 327, 337 (Ct. App. 2001).  Based on our finding that Portside is barred by the statute of limitations for the recovery of real property as to South Beach’s use of the Easement, we find no trespass.

CONCLUSION

For the foregoing reasons, the order of the circuit court is

AFFIRMED.

ANDERSON, SHORT, and WILLIAMS, JJ., concur.


[1] We decide this case without oral argument pursuant to Rule 215, SCACR.