BRENT REGAN and MOURA REGAN, husband and wife, Plaintiffs-Appellants,
JEFF D. OWEN and KAREN A. OWEN, husband and wife, Defendants-Respondents.
Opinion No. 19
from the District Court of the First Judicial District of the
State of Idaho, Kootenai County. Hon. John P. Luster,
judgment of the district court is vacated.
Macomber Law, PLLC, Coeur d'Alene, for appellants. Arthur
B. Macomber argued.
Vernon & Weeks, PA, Coeur d'Alene, for respondents.
Susan P. Weeks argued.
case addresses whether the issuance of a tax deed
extinguishes a prescriptive easement across a parcel of land
by operation of former Idaho Code section 63-1009. The Owens
purchased a small parcel of land ("the Orphan
Parcel") from Kootenai County after a tax sale. A
dispute arose as to whether the Regans had the right to drive
across the Orphan Parcel. The Regans sued the Owens to reform
the tax deed to include an express easement and to establish
a prescriptive easement.
district court granted summary judgment in favor of the
Regans, ruling that the Owens' deed contained a mutual
mistake and should be reformed to reflect an express easement
that the original grantors intended. The Owens appealed and
this Court held that the deed should not be reformed. We
vacated a portion of the district court's judgment and
remanded the case for further proceedings. Regan v.
Owen, 157 Idaho 758, 339 P.3d 1162 (2014)
("Regan I"). On remand, the district court
granted summary judgment in favor of the Owens, finding that
any prescriptive easement was extinguished by Idaho Code
section 63-1009, which provides that tax deeds convey
property free of all "encumbrances." The Regans
timely appealed. After they filed their appeal, the Idaho
Legislature amended Idaho Code section 63-1009. 2016 Idaho
Sess. L. ch. 273, § 7, p. 758. On September 8, 2017,
this Court released its original decision in this appeal. We
thereafter granted the Regans' petition for rehearing. We
vacate the judgment entered in favor of the Owens and remand
this case for further proceedings.
FACTUAL AND PROCEDURAL BACKGROUND
underlying facts of this case are set forth in Regan
I. 157 Idaho 758, 760-61, 339 P.3d 1162, 1164-65 (2014).
There, we held that the Regans' claim was not barred by
the statute of limitations. Id. at 762, 339 P.3d at
1166. We also held that the district court erred in reforming
the Owens' deed and concluding, on inadequate evidence,
that the Regans had a prescriptive easement over the Orphan
Parcel. Id. at 763-64, 339 P.3d at 1167-68.
Accordingly, the case was remanded to the district court.
Id. at 765, 339 P.3d at 1169.
remand, the Owens filed a third motion for summary judgment,
alleging that the Regans' prescriptive easement claim was
extinguished by issuance of the tax deed. The motion was
based on the last paragraph of this Court's decision in
Regan I which stated:
The tax deed conveyed to the county absolute title to the
Orphan Parcel "free of all encumbrances except mortgages
of record to the holders of which notice has not been sent as
provided in section 63-1004, Idaho Code, any lien for
property taxes which may have attached subsequently to the
assessment and any lien for special assessments. I.C. §
63-1009. An encumbrance is "any right or interest in
land to the diminution of its value, but consistent with the
free transfer of the fee." Hunt v. Bremer, 47
Idaho 490, 494, 276 P. 964, 965 (1929). Whether something is
an encumbrance does not depend upon the extent to which it
diminishes the value of the land. An encumbrance
"embraces all cases in which the owner does not acquire
the complete dominion over the land which his grant
apparently implies." An easement is not an encumbrance
if the easement is essential to the enjoyment of the land and
it enhances the land's value. Id. There is no
finding by the district court that the alleged prescriptive
easement across the Orphan Parcel increased its value.
Regan I, 157 Idaho at 765, 339 P.3d at 1169.
hearing was held and the district court issued a written
decision granting the Owens' motion. The court concluded
that the plain language of Idaho Code section 63-1009,
together with the definition of "encumbrances" and
interpretation of section 63-1009 in Regan I,
required the court to conclude that any claim the Regans had
to a prescriptive easement over the Orphan Parcel was
extinguished when the tax deed was issued. Accordingly, the
district court entered judgment in favor of the Owens.
March 30, 2016, several months after the Regans filed their
appeal, Governor Otter signed Senate Bill 1388 into law.
Section 1 of Senate Bill 1388 contains a lengthy statement of
legislative intent wherein this Court's decision in
Regan I is mentioned by name and the district
court's subsequent determination that Idaho Code section
63-1009 extinguished the Regans' private access easement
is expressly rejected. 2016 Idaho Sess. L. ch. 273, § 1,
p. 750. Section 1 further declares: "[a]s its context
should have made evident, the purpose of Section 63-1009,
Idaho Code, . . . has always been to convey title absolutely
free and clear of liens and mortgages of a monetary
nature." Id. Senate Bill 1388 amended Idaho
Code section 63-1009 to remove the reference to
"encumbrances" and to more clearly state that the
title conveyed by tax deed is the same as that of the
"record owner." As amended, Idaho Code section
63-1009 now provides:
EFFECT OF TAX DEED AS CONVEYANCE. The deed conveys to the
grantee the right, title, and interest held by the record
owner or owners, provided that the title conveyed by the deed
shall be free of any recorded purchase contract, mortgage,
deed of trust, security interest, lien, or lease, so long as
notice has been sent to the party in interest as provided in
sections 63-201(17) and 63-1005, Idaho Code, and the lien for
property taxes, assessments, ...