Arkansas Law of , Fifth Edition Chapter 30: Real

Howard W. Brill Vincent Foster Professor of Legal Ethics & Professional Responsibility

The following is an excerpt from the forthcoming Fifth Edition of Howard W. Brill’s book ARKANSAS LAW OF DAMAGES. Because it is an excerpt from a book, some of the references printed here are to other portions of the book not included. For each of the subheadings noted below, the footnote numbers restart at one. This has been reprinted with permission from West Publishing. The Fifth Edition will be published in late 2004.

REAL PROPERTY

§ 30–1 Damage to real property

§ 30–2 Damage to improvements

§ 30–3 Damage to trees and landscaping

§ 30–4 Damage to crops

§ 30–5 Absolute liability

§ 30–6 on real property

§ 30–7 Premises liability

§ 30–8 Trespass: severance of timber

§ 30–9 Trespass: removal of minerals and products

§ 30–10 Breach of to convey: action by buyer

§ 30–11 Breach of contract to purchase land: action by seller

§ 30–12 Rescission of land sale

§ 30–13 Ejectment

§ 30–14 The mistaken improver and the betterment statute

9 ARKANSAS LAW NOTES 2004 § 30–1. Damage to real property ly today, be treated as temporary damages, as they appear to be reversible. Even the deposit of toxic In the instance of negligently caused damage to wastes upon land may be correctable with modern techniques. land, the initial question is whether the injury is On the other , if the damage to the proper- permanent or temporary. Established case law ty is temporary, the measure of damages is the rea- states that if the value of the property destroyed sonable expense of necessary repairs.7 That measure depends upon its connection with the soil, the meas- has been applied to the cost of restoring a bridge,8 ure of damages is the change in the fair market cleaning a pond,9 reseeding a meadow,10 repaving a 1 value. For permanent damage to real property, the parking lot,11 replacing top soil and other land measure of damages is the difference in fair market cover,12 and remedying groundwater and soil con- value immediately before and immediately after the tamination.13 The objective is to provide the funds to occurrence.2 This measure has been applied to situ- restore the property to its condition prior to the ations ranging from the overflow3 or diversion of a injury.14 Indeed some of the cases suggest that the stream,4 to the destruction of growing trees,5 and to potential for restoration is a factor in determining the loss of top soil through water drainage.6 whether the damage should be treated as tempo- 15 Arguably these types of damages should, particular- rary.

§ 30-11 Damage to real property

1. Bush v. Taylor, 130 Ark. 522, 197 S.W. 1172 (1917). Real property is valued by the capitalization of income method, the replacement cost method, and the market or comparable value method. See § 18–3, supra.

2. Ark. Model Instruction (Civil 4th) 2222; St. Louis & San Francisco Railway Co. v. Friddle, 237 Ark. 695, 375 S.W.2d 373 (1964) (fire damage to 15 acres of pasture and timber lands).

3. St. Louis, I. M. & S. Ry. Co. v. Miller, 107 Ark. 276, 154 S.W. 956 (1913).

4. St. Louis, I. M. & S. Ry. Co. v. Magness, 93 Ark. 46, 123 S.W. 786 (1909).

5. St. Louis, I. M. & S. Ry. Co. v. Ayres, 67 Ark. 371, 55 S.W. 159 (1900) (trees were part of the land and could not be replaced in a short time).

6. Brouwer v. Stephens, 7 Ark.App. 87, 644 S.W.2d 329 (1983).

7. Ark. Model Instruction (Civil 4th) 2223.

8. Lewis v. Phillips, 223 Ark. 380, 266 S.W.2d 68 (1954) (restoration of a bridge).

9. Ross & Ross v. St. Louis, I. M. & S. Ry. Co., 120 Ark. 264, 179 S.W. 353 (1915).

10. St. Louis & San Francisco Ry. Co. v. Jones, 59 Ark. 105, 26 S.W. 595 (1894).

11. See Milligan v. General Oil Co., 293 Ark. 401, 738 S.W.2d 404 (1987) (gas spills from adjoining land necessitated repaving parking lot; but the amount of damages awarded was based on sheer speculation).

12. Kutait v. O’Roark, 305 Ark. 538, 809 S.W.2d 371 (1991) (restoration costs for the removal of several thousand yards of shale, rock and ground); C. R. T., Inc. v. Brown, 269 Ark. 114, 602 S.W.2d 409 (1980).

13. State of Arkansas v. Diamond Lakes Oil Co., 347 Ark. 618, 66 S.W.3d 613 (2003) (contamination from nearby gasoline storage tanks).

14. Fox v. Nally, 34 Ark. App. 94, 805 S.W.2d 661 (1991) (damage from construction of natural gas pipeline).

15. Highland Industrial Park, Inc. v. BEI Defense Systems Co., 192 F. Supp. 942 (W.D. Ark. 2002). 10 REAL PROPERTY In the case of temporary damage, the plaintiff is personal use for the land and a bona fide desire to also entitled to compensation for loss of use, from repair or restore the land to its pre-injury condition, the time of injury to the time the land was or could the court is more likely to view the injury as tempo- have been repaired or restored to its original condi- rary in nature and award replacement or restora- tion.16 That loss is typically measured by decreased tion costs. Even in the instance of industrial or com- rental value.17 The owner is entitled to recover for mercial property, restoration, if technologically pos- loss of use regardless of whether he repaired the sible, appears to have become in the view of the property.18 courts, the preferred remedy.23 Such an award The specific losses are determined on a case by might be appropriate even if the tortious conduct case basis. For example, in an action against a gov- increased the market value of the land when meas- ernment agency for negligently constructing and ured objectively. If the damages are temporary in maintaining a flood control ditch, when the owner nature, the change in fair market value is not even established that erosion had occurred, the court admissible ,24 for the fact finder is only to affirmed an award for the diminution in the fair consider repair and restoration costs. market value of the land, the diminished rent, and Whether the amount of restoration damages the cost of repairs to prevent further erosion.19 should be capped at the value of the property prior The fact-finder decides whether the injury is to injury, or by some other standards, is unresolved. temporary or permanent.20 If either of the measures An award of restoration costs that would exceed the will fully compensate the owner, some case law sug- pre-injury value of the land might be viewed as eco- gests that the measure that is more definite and cer- nomic waste and therefore inappropriate.25 tain and less expensive to the wrongdoer must be However, no Arkansas case law has actually capped adopted.21 However, recent authority indicates that restoration damages in such a fashion.26 Older cases the appropriate measure of damages requires con- may have reached that result, sub silento, by calling sideration of the owner’s current use or intended the injury permanent and assessing the damages as use of the land.22 To the extent that the owner had a change in fair market value.

16. Ark. Model Instruction (Civil 4th) 2224.

17. Highland Industrial Park, Inc. v. BEI Defense Systems Co., 192 F. Supp. 942 (W.D. Ark. 2002); Benton Gravel Co. v. Wright, 206 Ark. 930, 175 S.W.2d 208 (1943).

18. Ross & Ross v. St. Louis, I. M. & S. Ry. Co., 120 Ark. 264, 179 S.W. 353 (1915).

19. E. Ritter & Co. v. Dep’t of the Army, Corps of Engineers, 874 F.2d 1236 (8th Cir. 1989).

20. Benton Gravel Co. v. Wright, 206 Ark. 930, 175 S.W.2d 208 (1943).

21. Benton Gravel Co. v. Wright, 206 Ark. 930, 175 S.W.2d 208 (1943).

22. Worthington v. Roberts, 304 Ark. 551, 803 S.W.2d 906 (1991). See Bonds v. Sanchez–O’Brien Oil & Gas Co., 289 Ark. 582, 715 S.W.2d 444 (1986) (current trend in oil and gas leases is to place burden of restoration costs on lessee).

23. Highland Industrial Park, Inc. v. BEI Defense Systems Co., 192 F. Supp. 942 (W.D. Ark. 2002) (lessee damaged the land by dumping and burning hazardous wastes and thus polluting the groundwater.

24. State of Arkansas v. Diamond Lakes Oil Co., 347 Ark. 618, 66 S.W.3d 613 (2003); Fox v. Nally, 34 Ark. App. 94, 805 S.W. 2d 661 (1991).

25. See § 4–9, supra.

26. Highland Industrial Park, Inc. v. BEI Defense Systems Co., 192 F. Supp. 942 (W.D. Ark. 2002). 11 ARKANSAS LAW NOTES 2004 § 30–2. Damage to improvements improvements even after repairs or restoration have been completed. Such damages may be particularly If the improvements to the land are destroyed, appropriate in cases involving numerous construc- the proper measure of recovery is the replacement tion defects, termite infestation, or the presence of value of the improvements,1 at least when the prop- mold.7 erty destroyed can be replaced in substantially the The owner is also entitled to compensation for same condition.2 The age, condition, and depreciated loss of use, measured by rental or usable value, dur- value of the destroyed building must be considered.3 ing the time that he was deprived of the use of the For example, the measure of damages for destruc- destroyed or damaged improvement.8 For example, tion of a fence is not the total cost of replacement, when by a utility company caused dam- but the cost of replacement of the fence in substan- ages to a motel, the motel owners were entitled to, tially the same condition that existed when among other elements, loss of rental value of the destroyed, that is, an old fence.4 motel for five months following the fire.9 If the improvements to the land are only dam- Evidence in support of the proper measure of aged, the plaintiff is entitled to the costs of restora- damages is essential to the case. For example, when tion, assuming the property can be restored to sub- residential rental cabins were negligently stantially the same condition it was in immediately destroyed, the plaintiff offered evidence only as to 5 before the damage occurred. No Arkansas law dis- their net rental value.10 In the absence of proof of the cusses whether there is a cap on the amount of change in market value or the cost of replacement, a repairs; that is, whether an award in excess of the directed verdict for the defendant was proper. original value of the improvement would be econom- ic waste.6 Repair costs are particularly appropriate when the owner has a personal reason, as opposed § 30–3. Damage to trees to a merely commercial objective, for the restoration of the improvements. Unlike other jurisdictions, no Trees, shrubs, greenery, and similar landscaping Arkansas cases discuss “stigma” damages, the addi- may be an important aspect to the value of the land tional diminution in value connected with the itself. Accordingly, upon the destruction of ornamen-

§ 30-22 Damage to improvements

1. Minerva Enterprises, Inc. v. Howlett, 308 Ark. 291, 824 S.W.2d 377 (1992) (evidence demonstrated that mobile home had no value after sewer system back-up); Standridge v. Hot Springs, 271 Ark. 754, 610 S.W.2d 574 (1981).

2. Bush v. Taylor, 130 Ark. 522, 197 S.W. 1172 (1917). See the related cases on damages for breach of a construction con- tract in § 17–3, supra.

3. Missouri Pac. R. Co. v. Wood, 165 Ark. 240, 263 S.W. 964 (1924).

4. Barnes v. Young, 238 Ark. 484, 382 S.W.2d 580 (1964).

5. Morton v. Park View Apartments, 315 Ark. 400, 868 S.W.2d 448 (1993) (reasonable expense of necessary repairs to the property); Cy Carney Appliance Company, Inc. v. True, 226 Ark. 961, 295 S.W.2d 768 (1956).

6. See § 4-9 supra.

7. For a discussion of liability issues and damages to structures caused by mold, see Walter G. Wright, Jr. and Stephanie M. Irby, The Transactional Challenges Posed by Mold: Risk Management and Allocation Issues, 56 ARK. L. REV. 295, 347-371 (2003).

8. Ark. Model Instruction (Civil 4th) 2224.

9. Arkansas-Missouri Power Co. v. Deal, 263 Ark. 645, 566 S.W.2d 747 (1978).

12 REAL PROPERTY tal or shade trees, the use of the land must be con- However, some older cases follow the rule that sidered in determining the amount of damages.1 For the damages are measured by the change in market land that was to be used for residential purposes, value with and without the landscaping.9 In partic- the appropriate measure of damages is the cost of ular, evidence that the trees contributed nothing to restoration or replacement of the trees.2 the intended or likely use of the land would This rule reflects not only the owner’s intended strengthen an argument that replacement costs are use of the land, but also the aesthetic value of the inappropriate. Replacement costs are an inappro- trees or shrubs, their role in establishing privacy, priate measure of damages when they are grossly 10 and the potential energy savings. Accordingly disproportionate to the value of the land. Damage to trees may result from negligence, replacement costs have been awarded for the from innocent trespass, from intentional trespass, destruction of 40 oak, pine, and dogwood trees, with from willful and wanton conduct, and from inno- diameters of four to twelve inches, located on a res- cently started fires. Depending on the underlying 3 idential lot; for the destruction of 21 hardwood cause of action, the statutes may permit double or trees forming the entrance to a three-acre residen- treble damages.11 In addition to the general dam- 4 5 tial lot; for six pine and oak trees; for the loss of a ages of replacement cost or the change in the fair single post oak tree;6 and for 12 azalea bushes.7 market value, compensatory damages may also Provided that the replacement or restoration costs include clean-up costs, provided they do not overlap are not grossly disproportionate to the fair market or permit a double recovery.12 However, an addition- value of the land prior to the destruction of the al award for the stumpage value for the trees trees, such costs should be awarded.8 removed. is not appropriate.

10. Standridge v. Hot Springs, 271 Ark. 754, 610 S.W.2d 574 (1981). § 30-33 Damage to trees

1. Revels v. Knighton, 305 Ark. 109, 805 S.W.2d 649 (1991) (intended use of land as trailer park); Floyd v. Richmond, 211 Ark. 177, 199 S.W.2d 754 (1947) (destruction of 20 cedar trees on land particularly suitable for building sites).

2. Worthington v. Roberts, 304 Ark. 551, 803 S.W.2d 906 (1991) (negligent chemical spraying damaged over 100 shade trees and fruit trees).

3. Bowman v. McFarlin, 1 Ark.App. 235, 615 S.W.2d 383 (1981). A landscaping expert testified as to the cost of replacement trees four inches or less in diameter.

4. First Electric Cooperative Corp. v. Charette, 306 Ark. 105, 810 S.W.2d 500 (1991).

5. Revels v. Knighton, 305 Ark. 109, 805 S.W.2d 649 (1991). Damages for the replacement cost of the trees were trebled pur- suant to statute. See § 30–8, infra.

6. White River Rural Water District v. Moon, 310 Ark. 624, 839 S.W.2d 211 (1992) (replacement value of approximately $7500 based on government document).

7. Schueck v. Burris, 330 Ark. 780, 957 S.W.2d 702 (1997).

8. First Electric Cooperative Corp. v. Charette, 306 Ark. 105, 810 S.W. 2d 500 (1991) (award of replacement cost of $8300 was not grossly disproportionate to the fair market value of approximately $24,000).

9. Cy Carney Appliance Co. v. True, 226 Ark. 961, 295 S.W.2d 768 (1956) (appliance fire destroyed valuable shade trees at residence); Kyle v. Zellner, 215 Ark. 349, 220 S.W.2d 806 (1949).

10. Linebarger v. Owenby, 79 Ark. App. 61, 83 S.W.3d 435 (2002) (329 trees removed from 4 acres of land, but were generally not visible from residence and provided minimal value; replacement cost would be 67% of value of land).

11. See § 30–8, infra.

12. Linebarger v. Owenby, 79 Ark. App. 61, 83 S.W.3d 435 (2002). 13 ARKANSAS LAW NOTES 2004 § 30–4. Damage to crops Damages for the decreased yield must be reduced by the amount of any savings in harvesting and mar- When crops are damaged, the proper measure of keting. But such an offset would not be appropriate damages is the difference in the fair market value if the cost of harvesting the damaged crop would between the crop that the land would have produced have been the same for an undamaged crop.6 and the crop that was actually produced, minus the The fact-finder is to determine the probable savings in producing, harvesting, and marketing value the crop would have had at maturity, if the the actual crop.1 If the crop is destroyed totally, the negligence of the defendant had not intervened.7 In measure of damages is its market value at the time determining the value of the crop that was damaged of destruction.2 Again, any savings from not actual- or destroyed, the court is to consider all circum- ly harvesting or marketing the crop should reduce stances existing at the time of its destruction, or at the recovery. These rules are applicable only if the any time prior to trial, that would be relevant to the crop is sufficiently mature to have a market value.3 increase in the value of the crop and the expense or For example, six weeks after planting 190 acres, the hazards of the farming industry.8 For example, a crop of “knee-high” soybeans was flooded as a evidence of changes in market prices or weather result of a negligently maintained earthen dam, conditions prior to harvesting might have affected causing significant reduction in the yield of the the value and therefore would be arguably admissi- crop.4 Since a reasonable estimate could be made of ble. Likewise, while the calculation for reduced the productivity of the acres and because evidence of value is typically based on the “spot” or “cash” price yields from comparable but non-flooded land was for crops sold on the open market when ready for presented, an award for the reduced yield was cor- delivery, the increased reliance on “futures” con- rect. Similarly, when trespassing cattle damaged a tracts or bookings suggests that in some instances strawberry patch just prior to maturity, an award such contracts might be relevant and admissible reflecting the decreased yield was appropriate.5 evidence.9

§ 30-44 Damage to crops

1. Ark. Model Instruction (Civil 4th) 2226; Lowe v. E. I. DuPont de Nemours & Co., 802 F.2d 310 (8th Cir. 1986) (verdict of $53,040 for lowered crop yield affirmed). See McGraw v. Weeks, 326 Ark. 285, 930 S.W.2d 365 (1996) (damages of $55,000 for cot- ton crop damaged by drifting herbicide but still marketable; citing text).

2. Barnes v. Young, 238 Ark. 484, 382 S.W.2d 580 (1964).

3. Moore v. City of Blytheville, 1 Ark.App. 35, 612 S.W.2d 327 (1981). See Brown v. Chapman Farms, Inc., 289 Ark. 88, 709 S.W.2d 404 (1986) (evidence indicated that the yield would have been 12.3 bushels of soybeans per acre). For practical suggestions on proving market value, see David W. Cahoon, When Them Cotton Balls Get Rotten, ARK. LAWYER (July 1989) 117.

4. Dickerson Const. Co. v. Dozier, 266 Ark. 345, 584 S.W.2d 36 (1979).

5. Crumbley v. Guthrie, 207 Ark. 875, 183 S.W.2d 47 (1944).

6. J. L. Wilson Farms, Inc. v. Wallace, 267 Ark. 643, 590 S.W.2d 42 (Ark. App.1979). A farmer testified that “it costs just as much to harvest a poor acre of beans as it does a good acre of beans.” Lowe v. E. I. DuPont de Nemours & Co., 802 F.2d 310 (8th Cir. 1986).

7. Dickerson Const. Co. v. Dozier, 266 Ark. 345, 584 S.W.2d 36 (1979).

8. Dickerson Const. Co. v. Dozier, 266 Ark. 345, 584 S.W.2d 36 (1979). The damages to growing crops claimed by a tenant against a third party tortfeasor are limited to those suffered during the term of the leasehold . Burnette v. Morgan, 303 Ark. 150, 794 S.W.2d 145 (1990) (damage to peach and apple orchard).

9. McGraw v. Weeks, 326 Ark. 285, 930 S.W.2d 365 (1996) (suggesting revised Model Jury Instructions). 14 REAL PROPERTY In light of weather conditions and other factors appropriate damages would then be the cost of re- that vary annually, evidence as to the average yield seeding and replanting. As a result of the delayed per acre for the prior years is not reliable.10 On the planting, the subsequent crop might have a reduced other hand, a comparison between the damaged yield, for which the tortfeasor should be held liable. land and the yield from adjacent but undamaged If the lateness of the season prevents the planting of land during the same season, for the same crop, and another crop, the measure of damages is the rental with the same growing technique, is admissible and or usable value of the land for that growing season.16 11 reliable evidence. The defendant who has prevented the planting of If the crops are not sufficiently mature to meas- any crop is liable, at a minimum, for the rental ure their value, the measure of damages is the value of the land.17 12 rental value of the land. Whether the crops are In the instance of grass or other perennial crops, mature is a question for the fact-finder.13 The owner the recoverable damages are the value of the grass may testify as to the condition of the crop in the field or crop at the time of its destruction unless perma- and its expected value.14 The evidence of damages nent injury to the soil or root structure has must correspond to the maturity of the crop. For occurred,18 which is then compensable. In other example, if the crops are too immature to have a instances, the fairer measure of damages is the cost market value, evidence as to the rental value must be presented.15 However, such a limited recovery of reseeding or replanting and the rental value of may be far short of full compensation for a farmer the land from the time of the damage until it is 19 who expected to earn his livelihood from the land restored to its original condition. and who had major capital investments or debts in Under earlier law, the owner was entitled to pre- farm implements. judgment interest on the value of the crops The destruction of the crop early in the growing destroyed or damaged from the date of the injury.20 season may permit the planting of another crop. The However, that result is questionable in light of the

10. McCorkle Farms, Inc. v. Thompson, 79 Ark. App. 150, 84 S.W.3d 884 (2002) (reversible error to admit evidence of average per acre yields of cotton in county over 10 year period); J. L. Wilson Farms, Inc. v. Wallace, 267 Ark. 643, 590 S.W.2d 42 (Ark. App.1979).

11. McGraw v. Weeks, 326 Ark. 285, 930 S.W.2d 365 (1996) (damages properly based on price received per pound for cotton grown on a nearby field); J. L. Wilson Farms, Inc. v. Wallace, 267 Ark. 643, 590 S.W.2d 42 (Ark. App. 1979).

12. Adams v. Adams, 228 Ark. 741, 310 S.W.2d 813 (1958).

13. Dickerson Const. Co. v. Dozier, 266 Ark. 345, 584 S.W.2d 36 (1979).

14. Sullivan v. Voyles, 249 Ark. 948, 462 S.W.2d 454 (1971) (negligently applied chemicals damaged a “beautiful crop of toma- , squash and Irish potatoes”).

15. Moore v. City of Blytheville, 1 Ark.App. 35, 612 S.W.2d 327 (1981) (case remanded to permit evidence to be heard on the correct measure of damages).

16. Farm Bureau Lumber Corp. v. McMillan, 211 Ark. 951, 203 S.W.2d 398 (1947); St. Louis, I. M. & S. Ry. v. Saunders, 85 Ark. 111, 107 S.W. 194 (1908).

17. Gregory v. Walker, 239 Ark. 415, 389 S.W.2d 892 (1965).

18. Farm Bureau Lumber Corp. v. McMillan, 211 Ark. 951, 203 S.W.2d 398 (1947).

19. Missouri Pac. R. Co. v. Benham, 192 Ark. 35, 89 S.W.2d 928 (1936).

20. Dickerson Const. Co. v. Dozier, 266 Ark. 345, 584 S.W.2d 36 (1979); St. Louis S. W. Ry. Co. v. Ellis, 169 Ark. 682, 276 S.W. 996 (1925). 15 ARKANSAS LAW NOTES 2004 more recent rule that the amount of the loss must be mately caused.3 Without causation, recovery is ascertainable at the time of the damage.21 Punitive barred.4 Recognizing that strict liability is a harsh damages may be awarded against an intentional doctrine, the court has stressed that it is applicable tortfeasor.22 only in very limited situations.5 An activity is ultra-hazardous if it necessarily involves risk of serious harm to persons or property, § 30–5. Absolute liability which cannot be eliminated by the exercise of utmost care, and is not an activity customarily car- A property owner is absolutely liable for dam- 6 ages that result from certain ultra-hazardous activ- ried on by many people in the community. Although ities.1 If the doctrine of absolute liability is applica- the spraying of chemicals on crops may be ultra-haz- ble, the injured party need not prove negligence.2 ardous,7 the construction and maintenance of a bill- Regardless of the degree of care used by the proper- board sign8 and the operation of a lawn sprinkling ty owner, he is liable for the consequences proxi- system are not.9

21. See Chapter 10, supra.

22. Brown v. Chapman Farms, Inc., 289 Ark. 88, 709 S.W.2d 404 (1986) (intentional destruction of 187 acres of soybeans sup- ported compensatory damages of $26,202 and punitive damages of $55,000). See Schrader v. Schrader, 81 Ark. App.343, 101 S.W.3d 873 (2003) (statutory treble damages assessed against neighbor who had intentionally driven through vegetable garden and destroyed crops).

§ 30-55 Absolute liability

1. The historical development of the doctrine, commencing with Rylands v. Fletcher, L. R. 3 H. L. 330 (1868), is reviewed in North Little Rock Transportation Co., Inc. v. Finkbeiner, 243 Ark. 596, 420 S.W.2d 874 (1967). See also Jacob Sharp, Jr., Absolute Liability in Arkansas, 8 ARK. L. REV. 83 (1953).

The federal Comprehensive Environmental Response, Compensation and Liability Act of 1980, also known as Superfund or CERCLA, imposes liability for clean-up expenses and costs on those connected with the release of hazardous wastes or associ- ated with the contaminated sites. See Greg Yeatman, Superfunds: A Few Basic Concerns, 24 ARK. LAWYER 31 (April 1990).

2. Western Geophysical Co. of America v. Mason, 240 Ark. 767, 402 S.W.2d 657 (1966). Compare Wirth v. Reynolds Metals Co., 58 Ark.App. 161, 947 S.W.2d 401 (1997) (water well went dry after gas well was dug on adjacent property; summary judgment for owner of gas well).

3. Ark. Model Instruction (Civil 4th) 1108.

4. Hampton v. Arkansas Louisiana Gas Co., 282 Ark. 580, 669 S.W.2d 476 (1984).

5. Carroll-Boone Water Dist. v. M. & P. Equip. Co., 280 Ark. 560, 661 S.W.2d 345 (1983). See Arkansas Louisiana Gas Co. v. Central Util. Const., Inc., 278 Ark. 101, 643 S.W.2d 566 (1982) (court refused to apply absolute liability against a contractor who had damaged an underground utility line; since the utility company had some degree of fault, negligence was the proper theory).

6. Tri-B Advertising Co. v. Thomas, 278 Ark. 58, 643 S.W.2d 547 (1982).

7. Chapman Chem. Co. v. Taylor, 215 Ark. 630, 222 S.W.2d 820 (1949); McCorkle Farms, Inc. v. Thompson, 79 Ark. App. 150, S.W.3d 884 (2002).

8. Tri-B Advertising Co. v. Thomas, 278 Ark. 58, 643 S.W.2d 547 (1982).

9. North Little Rock Transp. Co. v. Finkbeiner, 243 Ark. 596, 420 S.W.2d 874 (1967).

16 REAL PROPERTY

For example, the party responsible for subsur- owner is absolutely liable for intentionally starting face blasting was held responsible for the damage to a fire on his property that causes damage to anoth- a neighbor’s water well.10 But the doctrine of er’s.16 absolute liability is not available to a landowner Arkansas law authorizes double damages who, knowingly, to blasting on the proper- against a party who starts a fire and fails to control 17 ty.11 The plaintiff in a blasting case may also rely it. The complaint must state a prayer for double upon a negligence theory by establishing that the damages; otherwise, the court cannot award them. results of the blast would not have occurred under More than mere negligence may be required to sus- 18 ordinary circumstances unless the blasting was neg- tain an award of double damages. ligently done.12 The calculation of general damages will depend upon the temporary or permanent § 30–6. Trespass on real property nature of the injury.13 Any person who intentionally starts a fire on According to the , a trespass is any grass or on other combustible material on his prop- entry on land that is in the peaceable possession of erty is liable for the damage resulting to another’s another, regardless of the willfulness of the entry, property.14 However, the owner is not liable if, before the degree of force used, the duration of the intrud- starting the fire, he notifies other owners of his ing presence, and the absence of damage to the land. plans and then exercises due care in preventing the For , at least nominal damages are fire from spreading.15 If the notice is not given, the usually awarded.1

10. Western Geophysical Co. of America v. Mason, 240 Ark. 767, 402 S.W.2d 657 (1966).

11. Carroll-Boone Water Dist. v. M. & P. Equip. Co., 280 Ark. 560, 661 S.W.2d 345 (1983).

12. Northside Const. Co. v. Huffman, 287 Ark. 145, 697 S.W.2d 89 (1985) (blasting resulted in the drying up of natural springs). See also Holden v. Carmean, 178 Ark. 375, 10 S.W.2d 865 (1928) (user of explosives is held to the highest standard of care).

13. See § 30–1, supra; Western Geophysical Co. of America v. Mason, 240 Ark. 767, 402 S.W.2d 657 (1966) (permanent dam- age resulted in decreased fair market value).

14. ARK. CODE ANN. § 18–60–103(a).

15. ARK. CODE ANN. § 18–60–103(b).

16. Swearengen v. Johns, 210 Ark. 119, 194 S.W.2d 445 (1946).

17. ARK. CODE ANN. § 20–22–304.

18. Hackleton v. Larkan, 326 Ark. 649, 933 S.W.2d 380 (1996).

§ 30-66 Trespass on Real Property

1. Pennington v. Woods, 204 Ark. 26, 161 S.W.2d 16 (1942) ($10 for unauthorized entry). On nominal damages, see Chapter 3, supra. Criminal trespass is committed by an individual purposefully entering or unlawfully remaining upon the premises of another. ARK. CODE ANN. § 5–39–203. In addition, a person who enters a public place of business and refuses to leave despite a

17 ARKANSAS LAW NOTES 2004 The general measure of damages against a party ured by the fair rental value of the tunnel for these who upon land is the fair rental value of purposes.3 the land. Obviously, in the instance of a brief or lim- In addition to that general measure of damages, ited trespass, the award will be minimal. The same special damages may also be appropriate against measure also applies to a repeated trespass which the occasional, the repeated, or the continuing tres- happens periodically, for example, annually during passer. For example, those special damages might a hunting season. Likewise it will apply to a contin- include the cost of removing debris or property left uing trespass, in the sense of a defendant who occu- on the land and the cost of restoring the land to the pies the land.2 same condition that it was in prior to the trespass.4 A who occupies land or a building Whether there is a cap on restoration damages, not without permission is liable for the fair rental value to exceed the actual value of the land or another of the property. The owner is entitled to damages measure, is unresolved. Damages that are tempo- even if the owner was not intending to rent the land, rary in nature and which will be repaired or correct- even if the land was not harmed, and even if the ed by the landowner should not be limited.5 Even in owner lacked knowledge of the occupation. The pur- the instance of commercial property that may not be pose behind the award is to compensate the owner restored, some recent authority supports restoration for his loss of the potential use and enjoyment of his costs.6 land. In an unusual case, the defendant had permis- A trespasser is liable for all damages that proxi- sion to use an underground tunnel to transport coal mately result from the illegal act, regardless of from one tract but improperly transported coal from whether the entry is willful or negligent.7 For exam- another tract as well; the wrong was in the nature ple, if the trespass causes physical injury to the of a trespass. Since any diminution in the value of owner, recovery for those injuries is permitted.8 If the tunnel was de minimis, the recovery was meas- the trespass was willful, then compensation for

request commits a trespass. ARK. CODE ANN. § 4–70–101(c). The latter statute may be used by a discount store to expel a competi- tor’s employees who are comparing prices. Culhane v. State, 282 Ark. 286, 668 S.W.2d 24 (1984).

2. DeLaughter v. Britt, 243 Ark. 40, 47, 418 S.W.2d 638, 642 (1967) (dissenting opinion by Fogelman, J.).

A continuing trespass negligently caused by a government may rise to the level of inverse condemnation, resulting in com- pensation pursuant to the eminent domain power. Robinson v. City of Ashdown, 301 Ark. 226, 783 S.W.2d 53 (1990) (nine years of trespass due to negligently maintained sewerage system). See § 18–6, supra.

3. Quality Excelsior Coal Co. v. Reeves, 206 Ark. 713, 177 S.W.2d 728 (1944).

4. Kutait v. O’Roark, 305 Ark. 538, 809 S.W. 2d 371 (1991); Shamlin v. Shuffield, 302 Ark. 164, 787 S.W. 2d 687 (1990) (dam- ages based on removal of stumps and debris and repair of soil).

5. State v. Diamond Lakes Oil Co., 347 Ark. 618, 66 S.W.3d 613 (2002) (award of restoration costs of $200,000 were appro- priate even though the value of the property was only $52,000; repairs had been mandated by state agency).

6. See § 30-1, supra.

7. See Farm Bureau Mut. Ins. Co. v. Henley, 275 Ark. 122, 628 S.W.2d 301 (1982) (use of matches by trespassing children caused extensive damage to a gift shop; question of fact for the jury whether a six-year-old child may be a trespasser).

As with all damage actions, mitigation of losses is essential. For example, when trespassing cattle destroyed crops, the plaintiff could recover only for those damages he could not have avoided by reasonable use of available resources. Ft. Smith Suburban Ry. Co. v. Maledon, 78 Ark. 366, 95 S.W. 472 (1906).

8. Boyd v. Fulton, 212 Ark. 555, 206 S.W.2d 753 (1947).

18 REAL PROPERTY mental anguish accompanying the physical injury sue in assumpsit.” In contemporary terminology, the would also be authorized.9 Punitive damages may owner would assert a claim based on unjust enrich- also be awarded for trespass,10 but only if actual ment and seek the profits or savings of the trespass- damages are recovered.11 er.15 In addition, equity might issue a mandatory If the trespass is continuing or permanent in injunction compelling the trespasser to remove nature, the land owner may seek injunctive relief to debris or to restore the land. end the trespass, claiming that a simple award of An action seeking damages for trespass to real damages is inadequate. Recognizing that each par- property must be brought within three years of the cel of land is unique, equity has been willing to trespass.16 That rule certainly applies to trespasses grant or at least to consider injunctive relief.12 For that are permanent or cause permanent damages. example, the remedy against an encroaching struc- This claim is barred if not brought withing three ture is typically a mandatory injunction compelling years. The inability to ascertain the trespass or the the owner to remove the portion of the structure extent of the injury may toll the running of the that crosses the boundary line.13 However, if equity statute under the discovery rule.17 in its discretion denies such a harsh remedy, dam- Most trespasses cause only temporary damages, ages for the continuing trespass may be particularly with the broadened definition appropriate.14 of temporary damages as those that are capable of An alternative measure of recovery would be being abated or remedied. Accordingly, since a con- restitutionary in nature. Suppose the trespasser tinuing trespass occurs again each new day, dam- occupied the land and profited (by conducting a tem- ages arising from multiple and repeated occurrences porary, but valuable enterprise) or benefitted from (for example, flooding that occurs periodically18 or savings (for example, by depositing hazardous the misuse of another’s tunnel system,)19 are limited wastes on the land). Rather than seek the fair rental to those suffered within the three years immediate- value, the owner might elect to “waive the and ly prior to the commencement of the action.20

9. Boyd v. Fulton, 212 Ark. 555, 206 S.W.2d 753 (1947). See § 4–7, supra.

10. McGlone v. Stokes, 193 Ark. 1008, 104 S.W.2d 191 (1937) (trespass included excavation of dirt from plaintiff’s property).

11. Stoner v. Houston, 265 Ark. 928, 582 S.W.2d 28 (1979).

12. Howard W. Brill, Equity: Real Property and the Problem of the Troublesome Neighbor, 1994 ARK. L. NOTES 1.

13. Smith v. Stewart, 10 Ark.App. 201, 662 S.W.2d 202 (1983).

14. Stuttgart Elec. Co., Inc. v. Riceland Seed Co., 33 Ark.App. 108, 802 S.W.2d 484 (1991) (warehouse encroached 2.3 feet; denial of injunction or easement, but compensatory damages of $1000).

15. See § 31–2, infra.

16. ARK. CODE ANN. § 16-56-105(4). See § 13-5, supra.

17. State of Arkansas v. Diamond Lakes Oil Company, 347 Ark. 618, 66 S.W. 3d 613 (2002).

18. Missouri Pacific Ry. Co. v. Holman, 204 Ark. 11, 160 S.W. 2d 499 (1942).

19. Quality Excelsior Coal Co. v. Reeves, 206 Ark. 713, 177 S.W. 2d 728 (1944).

20. See Atlanta Exploration, Inc. v. Ethyl Corp., 301 Ark. 331, 784 S.W. 2d 150 (1990).

19 ARKANSAS LAW NOTES 2004 However, other trespasses that result in tempo- § 30–7. Premises liability rary damages are continuing in nature. Once the invasion of the land occurs, it continues, whether in In addressing the situation where the party the form of a vehicle abandoned on another’s prop- entering upon the land of another is injured, the erty,21 a wall encroaching on the neighbor’s land, or Arkansas courts adhere to the common law distinc- the unauthorized deposit of toxic wastes. tions between the duties owed to , The trespass occurs on the date of the first invasion licensees, and .1 A trespasser is a person who or injury, but the failure of the defendant to remove enters upon the premises of another without the the continuing trespass tolls the running of the stat- of the owner and without an invitation, ue of limitations. Therefore, a landowner was per- either express or implied.2 The owner of the proper- mitted to proceed against an oil company that had ty has no duty to trespassers on his land as long as improperly used the land for disposing of oil field he is unaware of their presence.3 At that point, the wastes, even though the oil company’s activity on owner owes the trespasser only the minimal duty the land had ceased more than 50 years prior to the not to cause injury by willful or wanton conduct.4 commencement of the action.22 An exception to the general rule that landown- ers are not liable to trespassers is found in the

21. Coleman v. United Fence Company, 282 Ark. 344, 668 S.W. 2d 536 (1984) (dicta).

22. Sewell v. Phillips Petroleum Co., 197 F. Supp. 2d 1160 (W.D. Ark. 2002)

§ 30-77 Premises Liability

1. Baldwin v. Mosley, 295 Ark. 285, 748 S.W.2d 146 (1988).

2. Ark. Model Instruction (Civil 4th) 1107; Coleman v. United Fence Co., 282 Ark. 344, 668 S.W.2d 536 (1984) (person who parked his car on private property without permission was trespasser).

Courts have struggled with the issue of how to classify public safety officers. See Karen K. Wood, Note, Arkansas Adopts the Fireman’s Rule: Do Volunteer Firefighters Get Burned Twice? 50 ARK. L. REV. 363 (1997). The Fireman’s Rule, also known as the professional rescuer doctrine, provides that a private party whose negligence causes a fire has no duty to protect the firefight- er. Waggoner v. Troutman Oil Co., Inc., 320 Ark. 56, 894 S.W.2d 913 (1995) (volunteer firefighter).

3. Southwestern Bell Telephone Co. v. Davis, 247 Ark. 381, 445 S.W.2d 505 (1969).

This common law rule is now incorporated in the statutes. Act 581 of 1993, codified as ARK. CODE ANN. § 18–60–108(a), provides that “an owner, lessee, or occupant of land does not owe a to a trespasser on the land, and is not liable for any injury to a trespasser on the land, and no cause of action shall arise against the owner, lessee, or occupant of land until the presence of the trespasser on the premises is known and then the owner, lessee or occupant of the land shall be liable only for injuries caused by the willful or wanton misconduct of the owner, lessee, or occupant.”

The possessor of land adjacent to a street or highway has a duty to prevent dangerous conditions from occurring on his property that might cause injury to individuals leaving the roadway. However, if the dangerous condition preceded the construc- tion of the roadway or if the roadway created the dangerous condition, then the duty to prevent injury rests upon the party respon- sible for maintaining the road. 65th Center, Inc. v. Copeland, 308 Ark. 456, 825 S.W.2d 574 (1992).

4. Ark. Model Instruction (Civil 4th) 1102. Ark. Model Instruction (Civil 3rd) 1101 describes willful or wanton conduct as “a course of action which shows an actual or deliberate intention to harm or which, if not intentional, shows an utter indifference to or conscious disregard for the safety of others.” 20 REAL PROPERTY attractive doctrine. This doctrine holds acted as a reasonably careful child of that age and that a landowner who has upon his premises a con- intelligence would have acted.9 Ordinarily, the dition, object, instrumentality, or machine that is maturity or immaturity of the injured child is a dangerous to children of “tender years” has a duty question of fact for the jury.10 Arkansas courts have 11 to exercise due care to protect them.5 The duty aris- generally been reluctant to extend the doctrine. es when the owner knows, or should reasonably Perils or conditions that are obvious to children who know, that children are attracted to the land or the are old enough to be unattended do not create a sit- 6 object. The duty applies only if the child is too uation for the application of the doctrine.12 young to appreciate the nature of the risk and is too Accordingly, the attractive nuisance doctrine is not young to avoid the risk.7 For example, the doctrine applicable to ponds, either natural or artificial,13 or was applicable when a train crew started a fire and to buildings under construction.14 left it unattended, knowing that an unsupervised five-year-old child was present at the fire.8 A licensee enters the property with the consent The doctrine of attractive nuisance gives special of the owner, but for his own benefit, pleasure, or protection to children of “tender years.” The trial convenience. The consent of the owner may be court is to apply the factors of age, intelligence, and express or implied from the circumstances.15 A social experience to determine whether the injured child guest is a typical licensee,16 as are individuals mak-

5. Cooper v. Diesel Service, Inc., 254 Ark. 743, 496 S.W.2d 383 (1973); Carmichael v. Little Rock Housing Authority, 227 Ark. 470, 299 S.W. 2d 198 (1957) (natural pond not an attractive nuisance). ARK. CODE ANN. § 18–60–108(b), discussed in note 3, supra, does not affect the attractive nuisance doctrine, except that the doctrine cannot be applied to determine liability against an owner or occupant of agricultural land in favor of a trespasser over the age of 18.

6. See James H. McKenzie, Note, —Peddler’s Truck as Attractive Nuisance, 18 ARK. L. REV. 178 (1964).

7. Crawford v. Cox Planing Mill & Lumber Co., Inc., 238 Ark. 588, 383 S.W.2d 291 (1964). An additional factor may be the relative cost of remedying the dangerous condition in comparison to the risk of harm to children. See Ark. Model Instruction (Civil 4th) 1109.

8. Missouri Pacific R. R. Co. v. Lester, 219 Ark. 413, 242 S.W.2d 714 (1951).

9. Baucom v. City of North Little Rock, 249 Ark. 848, 462 S.W.2d 229 (1971) (14–year-old boy injured while playing with storm sewer system not entitled to benefit of doctrine); Burris v. Carroll Electric Cooperative Corp., 220 Ark. 294, 247 S.W.2d 490 (1952) (11–year-old boy injured by climbing pole and touching high voltage line); Garrett v. Arkansas Power & Light Co., 218 Ark. 575, 237 S.W.2d 895 (1951) (17–year-old injured while playing on high power lines not entitled to doctrine).

10. Missouri Pacific R. R. Co. v. Lester, 219 Ark. 413, 242 S.W.2d 714 (1951).

11. See James H. McKenzie, Case Note, Torts—Peddler’s Truck as Attractive Nuisance, 18 Ark.L.Rev. 178 (1964).

12. Crawford v. Cox Planing Mill & Lumber Co., 238 Ark. 588, 383 S.W.2d 291 (1964).

13. Cooper v. Diesel Service, Inc., 254 Ark. 743, 496 S.W.2d 383 (1973); Jones v. Comer, 237 Ark. 500, 374 S.W.2d 465 (1964). Compare Poston v. Fears, 318 Ark. 659, 887 S.W.2d 520 (1994) (unanswered question of applicability of attractive nuisance doc- trine in relation to young children and residential swimming pools).

14. Crawford v. Cox Planing Mill & Lumber Co., 238 Ark. 588, 383 S.W.2d 291 (1964).

15. Gann v. Parker, 315 Ark. 107, 865 S.W.2d 282 (1993) (repairman). See Ark. Model Instruction (Civil 4th) 1107.

16. Heigle v. Miller, 332 Ark. 315, 965 S.W.2d 116 (1998) (dinner guest was a licensee); Turner v. Stewart, 330 Ark. 134, 952 S.W.2d 156 (1997) (person who entered friend’s premises to borrow card tables was a licensee); Bader v. Lawson, 320 Ark. 561, 898 21 ARKANSAS LAW NOTES 2004 ing permissive use of land crossings17 The status of licensee a duty to warn him of hidden dangers that other visitors to the premises may present factual the licensee might not recognize.22 issues.18 As in the case of the trespasser, the owner An enters the property with the permis- is under no duty to inspect the property to deter- sion of the owner, for a purpose connected with an 19 mine whether it is safe. activity of the owner, and for the mutual benefit of Once the presence of the licensee is known, or both parties.23 A customer on business premises is reasonably should be known, the owner is under a the classic invitee,24 but workers25 and prospective 26 duty not to cause the licensee injury by willful and employees also fall into this category. A related doc- wanton conduct.20 Upon discovering that the licens- trine is that of the implied invitee, which requires ee is in a position of danger, the owner is under an an affirmative act by the landowner to induce enhanced duty to exercise reasonable and ordinary another to enter the premises.27 In some instances, care.21 Additionally, the landowner may owe the the duty of an owner to an invitee may even extend

S.W.2d 40 (1995) (eight-year-old girl jumping on neighbors’ trampoline was licensee); Young v. Paxton, 316 Ark. 655, 873 S.W.2d 546 (1994) (guest helped owner cut tree limbs); Gilliam v. Thompson, 313 Ark. 698, 856 S.W.2d 877 (1993) (plaintiff was visitor to nephew’s apartment); Tucker v. Sullivan, 307 Ark. 440, 821 S.W.2d 470 (1991) (live-in companion was a licensee, even though she contributed to household expenses).

17. Aluminum Co. of America v. Guthrie, 303 Ark. 177, 181, 793 S.W.2d 785, 787 (1990) (Hays, J., dissenting).

18. Lively v. Libbey Memorial Physical Medicine Center, Inc., 311 Ark. 41, 841 S.W.2d 609 (1992) (jury question as to whether employee who was using company whirlpool facility on personal time was a licensee or invitee).

19. Webb v. Pearson, 244 Ark. 109, 424 S.W.2d 145 (1968).

20. Ark. Model Instruction (Civil 4th) 1103.

21. See Bader v. Lawson, 320 Ark. 561, 898 S.W.2d 40 (1995); Baldwin v. Mosley, 295 Ark. 285, 748 S.W.2d 146 (1988) (11–year- old visitor in defendant’s home injured when rung of stool broke).

22. Heigle v. Miller, 332 Ark. 315, 965 S.W.2d 116 (1998) (owner had duty to warn guest of unusually slippery bathroom floor); Dorton v. Francisco, 309 Ark. 472, 833 S.W.2d 362 (1992) (evidence supported finding that visitor to dairy farm was a licensee in a position of danger from farm equipment); King v. Jackson, 302 Ark. 540, 790 S.W.2d 904 (1990) (no duty to warn licensee of the presence of shoes on the front porch).

23. Shrum v. Southern Farm Casualty Ins. Co., 312 Ark. 151, 848 S.W.2d 395 (1993); Ark. Model Instruction (Civil 4th) 1107.

An invitee who strays from the limitations or boundaries of the original invitation loses the protection of that status and becomes a licensee or trespasser. Daniel Construction Co. v. Holden, 266 Ark. 43, 585 S.W.2d 6 (1979).

24. Shrum v. Southern Farm Casualty Ins. Co., 312 Ark. 151, 848 S.W.2d 395 (1993) (policy holder visiting office of agent). See also Diebold v. Vanderstek, 304 Ark. 78, 799 S.W.2d 804 (1990) (accident in parking lot of business).

25. Arkansas Kraft v. Cottrell, 313 Ark. 465, 855 S.W.2d 333 (1993); Kay v. Kay, 306 Ark. 322, 812 S.W.2d 685 (1991).

26. J. M. Mulligan’s Grille, Inc. v. Aultman, 300 Ark. 544, 780 S.W.2d 554 (1989).

27. Dorton v. Francisco, 309 Ark. 472, 833 S.W.2d 362 (1992) (evidence supported conclusion that visitor to farm who volun- teered to help with equipment was an implied invitee); Aluminum Co. of America v. Guthrie, 303 Ark. 177, 793 S.W.2d 785 (1990) (mere acquiescence in public’s occasional use of private bridge was not sufficient to reach the level of an implied invitation).

22 REAL PROPERTY beyond the boundaries of the owner’s property.28 To “slip and fall” case, the mere accident does not cre- the invitee the owner owes the higher duty of using ate an inference of negligence.32 Nor is a case of neg- ordinary care to keep the premises in a reasonably ligence established by the plaintiff’s testimony that safe condition.29 To recover from the owner because the floor was slick or slippery.33 The plaintiff must of a failure to use ordinary care, the invitee must offer evidence demonstrating the probable causes of show that (1) the premises were defective; (2) the the accident, not merely possible causes.34 The cus- owner created the defect, or the defect was apparent tomer/invitee has the burden of showing that the to a reasonable owner who should have then warned presence of the substance or object on the floor was the invitee; and (3) the defect caused the injury.30 the result of the negligence of the defendant.35 In the The owner’s increased duty to an invitee does alternative, the customer must establish that the not mean that the owner is absolutely liable for any substance had been on the floor for such a period of injury to the invitee.31 For example, in the typical time that the defendant knew or should have known

28. Ollar v. Spakes, 269 Ark. 488, 601 S.W.2d 868 (1980) (invitee fell on the parking lot of a third party while entering defen- dant’s restaurant).

29. Ark. Model Instruction (Civil 4th) 1104; Kay v. Kay, 306 Ark. 322, 812 S.W.2d 685 (1991) (no breach of duty of ordinary care when maid in private residence was bitten by brown recluse spider); Johnson v. Arkla, Inc., 299 Ark. 399, 771 S.W.2d 782 (1989).

30. Gann v. Parker, 315 Ark. 107, 865 S.W.2d 282 (1993) (action by injured repairman failed because homeowner had no knowledge of defective wiring).

31. Moore v. Willis, 244 Ark. 614, 426 S.W.2d 372 (1968) (mere evidence that victim had slipped on puddle of water inside store did not require submission of case to jury). Some owners are given special protection, for example, ARK. CODE ANN. § 18–60–107 (landowner who permits individuals to enter his premises to glean, pick, or purchase agricultural products).

32. Alexander v. Town and Country Discount Foods, Inc., 316 Ark. 446, 872 S.W.2d 390 (1994) ( not applica- ble in slip and fall cases); Johnson v. Arkla, Inc., 299 Ark. 399, 771 S.W.2d 782 (1989).

33. Black v. Wal–Mart Stores, Inc., 316 Ark. 418, 872 S.W.2d 56 (1994); J. M. Mulligan’s Grille, Inc. v. Aultman, 300 Ark. 544, 780 S.W.2d 554 (1989). Brunt v. Food 4 Less, Inc., 318 Ark. 427, 885 S.W.2d 894 (1994).

34. Morehart v. Dillard Dept Stores, 322 Ark. 290, 908 S.W.2d 331 (1995) (no evidence that ramp was defective or that any- thing on it caused fall); Mankey v. Wal–Mart Stores, Inc., 314 Ark. 14, 858 S.W.2d 85 (1993); Trent v. KMS, Inc., 55 Ark.App. 355, 935 S.W.2d 6 (1996) (allegation that improper application of asphalt caused plaintiff to slip on incline).

35. Ark. Model Instruction (Civil 4th) 1106. Newberg v. Next Level Events, Inc., 82 Ark. App. 1, 110 S.W. 3d 332 (2003) (ques- tion of fact as to whether owner had improperly applied wax to floor, and thereby caused fall of plaintiff); Conagra, Inc. v. Strother, 340 Ark. 672, 13 S.W.3d 150 (2000) (owner had temporarily removed safety mats from slippery hallway; jury verdict for plaintiff affirmed); Shrum v. Southern Farm Casualty Ins. Co., 312 Ark. 151, 848 S.W.2d 395 (1993) (jury question presented by evidence as to soap on bathroom floor); Boykin v. Mr. Tidy Car Wash, Inc., 294 Ark. 182, 741 S.W.2d 270 (1987) (allegation that soapy water on floor was result of negligent car wash operation); Martin v. Hearn Spurlock, Inc., 73 Ark. App. 276, 43 S.W.3d 166 (2001) (jury question as to whether mopping floors in convenience store demonstrated negligence by owner).

Compare Thompson v. American Drug Stores, Inc., 326 Ark. 536, 932 S.W.2d 333 (1996) (allegation that wrong type of wax was used on floor; jury verdict for store); Lytle v. Wal–Mart Stores, Inc., 309 Ark. 139, 827 S.W.2d 652 (1992) (allegation that store was negligent in placing Bart Simpson school folders on top shelf, causing customer to climb on shelf and be injured, did not pres- ent jury question; likewise, alleged inattentiveness or discourtesy of store employee did not violate duty of using ordinary care); Macom v. Wal–Mart Stores, Inc., 305 Ark. 544, 809 S.W.2d 819 (1991) (store not liable for customer’s fall on a red ink pen in aisle; no evidence that store’s clean-up policy fell short of the duty of ordinary care).

It is important to remember that a defendant, in moving for summary judgment, has the burden of showing that no gen- uine issue of material fact exists. See Kelley v. National Union Fire Ins. Co., 327 Ark. 329, 937 S.W.2d 660 (1997) (summary judg- 23 ARKANSAS LAW NOTES 2004 of its presence and that the defendant failed to use recurring or on-going, the legal analysis is simply ordinary care to remove the substance.36 whether the owner used ordinary care to keep his The burden is on the plaintiff to demonstrate premises safe. For example, evidence that the store that the length of time the substance was on the management knew fruits and vegetables were fre- floor was substantial.37 For example, the presence of quently on the floor of the produce section support- water in an aisle of a grocery store for an hour was ed a verdict that the store failed to exercise reason- inadequate to establish that any employee of the 40 defendant knew of its presence.38 Lacking evidence able care toward its customers. of either alternative approach, the plaintiff’s claim Because of his superior knowledge of unreason- must fail.39 able risks,41 the owner of property has a duty to If, however, the slippery condition that caused warn the invitee of a dangerous condition or defect. the accident is not an isolated incident, but has been However, that duty does not apply to conditions that

ment for defendant reversed; plaintiff offered evidence that accident was caused by construction dust left on airport terminal cor- ridor as result of negligence).

36. Fayetteville Diagnostic Clinic, Ltd. v. Turner, 344 Ark. 490, 42 S.W.3d 420 (2001) (evidence that medical clinic knew of water on the floor and failed to take corrective action); Wal–Mart Stores, Inc. v. Kelton, 305 Ark. 173, 806 S.W.2d 373 (1991) (store liable for injury caused by puddles of rainwater inside door when employees failed to remove water or warn customers). Under this alternative approach, the foreign substance is typically not under the exclusive control of the owner of the premises, and was brought into the store by another customer or other third party. See the dissent by Judge Pittman in Tomlin v. Wal-Mart Stores, Inc., 81 Ark. App. 198, 100 S.W. 3d 57 (2003).

37. Wal-Mart Stores, Inc. v. Regions Bank Trust Department , 347 Ark. 826, 69 S.W. 3d 20 (2002) (evidence that liquid from snow globe had been on floor for a substantial time); Harvey v. Wal–Mart Stores, Inc., 33 F.3d 969 (8th Cir. 1994) (no evidence as to how long a yellow, dried, crusty and dirty substance had been on the floor); Wilson v. J. Wade Quinn Co., Inc., 330 Ark. 306, 952 S.W.2d 167 (1997) (summary judgment for defendant reversed; jury question as to how long substance had been on floor and whether store employees knew of its presence); Mankey v. Wal–Mart Stores, Inc., 314 Ark. 14, 858 S.W.2d 85 (1993) (no evidence as to how long motor oil was on the floor); Bank of Malvern v. Dunklin, 307 Ark. 127, 817 S.W.2d 873 (1991) (customer failed to show that the water was on the floor long enough that bank employees should have been expected to remove it).

38. Safeway Stores, Inc. v. Willmon, 289 Ark. 14, 708 S.W.2d 623 (1986). See House v. Wal–Mart Stores, Inc., 316 Ark. 221, 872 S.W.2d 52 (1994) (strong pine odor was not sufficient to create an inference that employees knew of presence of disinfectant on the floor).

The presence of an employee in the vicinity prior to the accident is not sufficient evidence of negligence. Wal–Mart Stores, Inc. v. Bernard, 69 Ark.App. 238, 10 S.W.3d 915 (2000) (slipped on water in restroom; jury verdict for plaintiff reversed).

39. Sanders v. Banks, 309 Ark. 375, 830 S.W.2d 861 (1992) (no evidence that alleged tobacco juice on floor was the result of defendant’s negligence or that it had been on the floor for a period of time); Dye v. Wal–Mart Stores, Inc., 300 Ark. 197, 777 S.W.2d 861 (1989); Tomlin v. Wal-Mart Stores, Inc., 81 Ark. App.198, 100 S.W.3d 57 (2003) (no evidence how long strapping band had been on floor; jury verdict for plaintiff reversed); Fred’s Stores of Tennessee, Inc. v. Brooks, 66 Ark. App. 38, 987 S.W.2d 287 (1999) (jury verdict for customer reversed; no evidence that defendant had negligently caused hair gel to be on floor, or to its length of time on the floor).

40. Brookshires Grocery Co. v. Pierce, 71 Ark. App. 203, 29 S.W.3d 742 (2000). Compare Rodgers v. La Quinta Motor Inn, 316 Ark. 644, 873 S.W.2d 551 (1994) (motel guest bitten by brown recluse spider; motel had used ordinary care in spraying with insec- ticide and had no prior knowledge); Arkansas Kraft v. Cottrell, 313 Ark. 465, 855 S.W.2d 333 (1993) (mere evidence that steps were “narrow” and stairwell was “hot” was insufficient to support jury verdict of negligence in claim for injuries suffered in fall).

41. Van Deveer v. RTJ, Inc., 81 Ark. 379, 101 S.W.3d 881 (2003) (jury question as to whether dangerous condition of stairs was open and obvious, and whether invitee had knowledge). 24 REAL PROPERTY are obvious.42 Under the obvious danger rule, any tory law limits their potential liability toward per- duty owed by the owner to a business invitee ends if sons who enter for recreational purposes.49 The the invitee knows of the danger, unless the invitee is owner of land has no duty to keep the premises safe required to encounter the danger.43 A duty may exist or warn of the presence of a dangerous condition or to an invitee who is required to encounter the dan- activity.50 By permitting the guest to come on the ger in order to perform a task.44 premises for recreational purposes, the landowner As a general proposition, the owner of the prem- does not thereby give any assurance that the land is ises is not liable for injuries caused to an invitee by safe for any purposes, nor confer on that person the the unauthorized or criminal acts of third parties.45 status of an invitee or licensee.51 However, if such acts were foreseeable, the owner may be under a duty to give warnings or take other The statute does not change any common law reasonable steps.46 Similarly, the owner may assume liability that exists for malicious, but not mere neg- a duty of care even if the law does not mandate a ligent, failure to guard or warn against an ultra- duty.47 The owner is not liable for injuries suffered hazardous condition, structure, or activity that is on the premises that are not causally related to the actually known to the owner to be dangerous. Nor is condition of the premises.48 liability altered when injury is suffered in any In an attempt to encourage landowners to make instance where the landowner charges an admission land and water areas available to the public, statu- price or fee for permission to go on the land.52

42. Like v. Pierce, 326 Ark. 802, 934 S.W.2d 223 (1996) (customer injured stepping onto gravel walkway; summary judgment for owner); Jenkins v. Hestand’s Grocery, Inc., 320 Ark. 485, 898 S.W.2d 30 (1995) (ramp into grocery store was equally obvious to customer).

43. Ethyl Corp. v. Johnson, 345 Ark. 476, 49 S.W. 3d 644 (2001) (not foreseeable that victim would attempt to move one ton container by himself; no duty to warn or take precautions).

44. Jenkins v. International Paper Co., 318 Ark. 663, 887 S.W. 2d 300 (1994).

45. Boren v. Worthen Nat’l Bank, 324 Ark. 416, 921 S.W.2d 934 (1996) (bank customer assaulted at night while using ATM); Lovell v. St. Paul Fire & Marine Ins. Co., 310 Ark. 791, 839 S.W.2d 222 (1992) (hospital not liable to visitor injured by negligent driver in hospital parking lot). See Chris A. Averitt, Note, Bank Not Liable for Attack on ATM Patron, 50 ARK. L. REV. 521 (1997).

46. Willmon v. Wal–Mart Stores, Inc., 143 F.3d 1148 (8th Cir. 1998) (customer abducted from parking lot and murdered; under either the Specific Harm Test or the Prior Similar Incidents Test, no duty of care owed by store); Parnell v. C & N Bowl Corp., Inc., 954 F.Supp. 1326 (W.D.Ark.1997) (kidnapping of decedent from parking lot of bowling alley was sudden, unexpected and unfore- seeable).

47. See the discussion in Holloway v. Stuttgart Regional Medical Center, 62 Ark.App. 140, 970 S.W.2d 301 (1998).

48. MIC v. Barrett, 313 Ark. 527, 855 S.W.2d 326 (1993) (Burger King not liable when customer was assaulted by third party in parking lot of restaurant after closing hours).

49. ARK. CODE ANN. § 18–11–301. Individuals are prohibited from entering private land for recreational purposes, including hunting, fishing, camping and swimming, when the land has been properly posted. ARK. CODE ANN. § 18–11–401 et seq.

50. ARK. CODE ANN. § 18–11–304.

51. ARK. CODE ANN. § 18–11–305.

52. ARK. CODE ANN. § 18–11–307.

25 ARKANSAS LAW NOTES 2004

For example, when a teenager, swimming with knowingly cut down, destroy, or carry away any 2 permission on the defendant’s land, hit an under- trees, timber, or related products. That statute is ground rock and became a quadriplegic, he alleged also applicable to any person who aids or assists the that the defendant owner was liable for a failure to trespasser and to any person who knowingly pur- warn of a dangerous condition, namely submerged chases or receives the trees or timber.3 The owner is rocks. In the absence of a showing that the defen- entitled to double the value of the timber cut.4 dant knew or should have known of the rock and of Double damages are assessed only against a tres- the likelihood of injury, the action was dismissed. passer who has no probable cause to believe he had 5 The owner had no duty to examine the depths of the a right to remove the trees. His knowledge is not waters, at least without any prior indication of dan- presumed or fictitiously satisfied; it must be affir- matively demonstrated.6 ger.53 Likewise, the statute was a viable defense to a claim asserted by the estate of a teenager killed in a Second, a 1937 statute provides that any person 54 who cuts down, injures, destroys, or carries away fall off the bluffs at White Rock Mountain. any tree placed or growing for use or shade on the land of another person is liable for treble the value § 30–8. Trespass: severance of timber of the timber damaged, destroyed, or carried away, together with costs.7 If the defendant had probable Three separate measures of damages are avail- cause to believe that the land on which he tres- able against a trespasser who severs timber.1 First, passed or the trees which he cut were his own, he is an 1883 statute provides civil damages against liable only for the actual value of the timber cut and those who trespass upon the land of another and removed, together with costs.8 The failure to have a

53. Mandel v. United States, 545 F.Supp. 907 (W.D.Ark.1982), reversed in part, 719 F 2d 963 (8th Cir. 1983).

54. Roten v. United States, 850 F.Supp. 786 (W.D.Ark.1994). See Carlton v. Cleburne County, Arkansas, 93 F.3d 505 (8th Cir. 1996) (no liability when pedestrian bridge used for recreational purposes collapsed).

§ 30-88 Trespass: severance of timber

1. Russell v. Pryor, 264 Ark. 45, 568 S.W.2d 918 (1978). For background information on timber law, see Christopher R. Kelley, Representing the Arkansas Timber Owner in Timber Sales Transactions: Some Contract Drafting Considerations, 8 U. ARK. LITTLE ROCK L.J. 637 (1986).

2. ARK. CODE ANN. § 15–32–301.

3. ARK. CODE ANN. § 15–32–301.

4. Peek v. Henderson, 208 Ark. 238, 185 S.W.2d 704 (1945).

5. Rosengrant v. Matthews, 55 Ark. 440, 18 S.W. 541 (1892).

6. Parker v. Fenter, 216 Ark. 398, 225 S.W.2d 940 (1950).

7. ARK. CODE ANN. § 18–60–102(a). See Hackleton v. Larkan, 326 Ark. 649, 933 S.W. 2d 380 (1996) (damage caused by fire). See also § 30-5, supra.

8. ARK. CODE ANN. § 18–60–102(c); Case v. Hunt, 217 Ark. 929, 234 S.W.2d 197 (1950) (856 pine trees). The statutory refer- ence to awardable costs does not include attorney fees. Linebarger v. Owenby, 79 Ark. App. 61, 83 S.W.3d 435 (2002). 26 REAL PROPERTY survey made prior to cutting is evidence of willful- ter practice is for the court to treble the damages, ness, but is not conclusive.9 although the jury may do so if properly instructed.17 Under the 1937 statute, the damages may be Unlike the 1883 statute, the 1937 statute also measured by either the value of the timber itself or covers damage to trees, even without the intent to the damages caused to the market value of the cut down or remove.18 For treble damages, however, land.10 Timber is valued at the stump,11 that is, the it is essential to demonstrate intentional wrongdo- value of the timber standing in the tree.12 Stumpage ing by the defendant, although that may be inferred is also defined as “the right to enter upon the land from the carelessness, recklessness, or negligence of and cut trees.”13 The court may consider the use to the offending party.19 One who employs a timber cut- which the trees would have been put, including ter is liable if the cutter trespasses, provided that he specifically their use solely as shade trees.14 In other acts at the direction or advice of the employer.20 If instances the fact-finder has been permitted to con- the employer, however, did point out the correct sider the change in fair market value of the land boundary lines, the employer would not be liable for 15 with and without the trees. Depending on the use treble damages.21 to which the property might be put, replacement Since the statute provides for treble damages, cost may also be an appropriate measure.16 The bet- awarding punitive damages as well for the trespass

9. Freeze v. Hinkle, 229 Ark. 714, 317 S.W.2d 817 (1958).

10. Stoner v. Houston, 265 Ark. 928, 582 S.W.2d 28 (1979).

11. Peek v. Henderson, 208 Ark. 238, 185 S.W.2d 704 (1945).

12. Burbridge v. Bradley Lumber Co., 218 Ark 897, 239 S.W.2d 285 (1951). On occasion, stumpage value seems to refer to the timber that has been felled and cut into logs. See Russell v. Pryor, 264 Ark. 45, 568 S.W.2d 918 (1978).

13. Dugal Logging, Inc. v. Arkansas Pulpwood Co., 66 Ark. App. 22, 988 S.W.2d 25 (1999).

14. Laser v. Jones, 116 Ark. 206, 172 S.W. 1024 (1915).

15. Arnold v. Lee, 296 Ark. 339, 756 S.W.2d 904 (1988).

16. Revels v. Knighton, 305 Ark. 109, 805 S.W.2d 649 (1991) (owner envisioned land as a mobile home park; award based on replacement cost and treble damages for willful trespass and destruction of oaks and pines affirmed). See Dilliard v. Wade, 74 Ark. App. 38, 45 S.W.3d 848 (2001) (wrongful cutting of timber by co-tenant; award based on value of the timber and cost of restora- tion).

17. Stoner v. Houston, 265 Ark. 928, 582 S.W.2d 28 (1979).

18. McLouth v. General Tel. Co. of the Southwest, 164 F.Supp. 496 (W.D.Ark.1958) (ornamental Chinese elms damaged by intentional chemical spraying; treble damages awarded).

19. Callaway v. Perdue, 238 Ark. 652, 385 S.W.2d 4 (1964); Auger Timber Co. v. Jiles, 75 Ark. App. 179, 56 S.W.3d 386 (2001) (timber company did not survey land or take measurements; treble damages awarded). For example, McGee v. Wilson, 275 Ark. 466, 631 S.W.2d 292 (1982) (evidence that timber cut ranged in value between $4000 and $6000 supported an award of $16,000).

20. Lewis v. Mays, 208 Ark. 382, 186 S.W.2d 178 (1945).

21. Russell v. Pryor, 264 Ark. 45, 568 S.W.2d 918 (1978).

27 ARKANSAS LAW NOTES 2004 constitutes a double recovery.22 However, in addition passer is not entitled to any reduction for his work to recovering for the value of the timber cut, the and labor in enhancing the value.28 The innocent plaintiff may also establish and recover for damages purchaser of the timber removed may also be liable to the land itself.23 to the owner for its value or even its enhanced These statutory remedies are an alternative to value, together with interest from the date of the those of the common law.24 Under the common law by the innocent purchaser.29 rule, the innocent trespasser who cuts and removes The jury may be instructed on all three theories, timber and converts it to lumber is liable for the but of course, only one recovery is appropriate.30 value of the wood in its manufactured state, less the costs of the trespasser’s labor, material, and expen- ditures in transforming it.25 In effect, this measure § 30–9. Trespass: removal of minerals and products gives the owner the value of the timber in the tree, along with any increase. If the expenditures exceed The measure of damages for unlawfully remov- the increase in value, the original owner recovers ing minerals from the land of another depends upon only the stumpage value.26 whether the invasion of property was willful or the Under the common law, the owner of the land result of an honest mistake. If the trespass was from which the timber has been cut and removed by unintentional, the defendant is liable only for the a willful trespasser may recover his property after it value of the ore in the ground.1 The value, typically has been improved into lumber or furniture, or he determined on a royalty basis, reflects the location may recover its enhanced value.27 The willful tres- and circumstances of the mine or quarry, the quali-

22. Stoner v. Houston, 265 Ark. 928, 582 S.W.2d 28 (1979). See the dissenting argument that the two wrongs are separate and distinct.

23. Shamlin v. Shuffield, 302 Ark. 164, 787 S.W.2d 687 (1990) (award of $8000 for restoration of the land and $1986 for value of timber removed was properly trebled); Arnold v. Lee, 296 Ark. 339, 756 S.W.2d 904 (1988) (jury’s award of $6508, based upon reconstruction costs following bulldozing of plaintiff’s land, was trebled by the court); Auger Timber Co. v. Jiles, 75 Ark.App. 179, 56 S.W.3d 386 (2001) (recovery also for road repair and tree replanting).

24. Bailey v. Hammonds, 193 Ark. 633, 101 S.W.2d 785 (1937).

25. Burbridge v. Bradley Lumber Co., 218 Ark 897, 239 S.W.2d 285 (1951). See Hackleton v. Larkan, 326 Ark. 649, 933 S.W. 2d 380 (1996) (damage caused by fire). See also § 30-5 supra. This measure is also appropriate when the timber cut in the field is taken directly to the mill, even if it is not enhanced at that time. Dugal Logging, Inc. v. Arkansas Pulpwood Co., 66 Ark. App. 22, 988 S.W.2d 25 (1999). For conversion generally, see § 33–7, infra.

26. Burbridge v. Bradley Lumber Co., 218 Ark. 897, 239 S.W.2d 285 (1951).

27. Kansas City Fibre Box Co. v. F. Burkart Mfg. Co., 184 Ark. 704, 44 S.W.2d 325 (1931).

28. Bailey v. Hammonds, 193 Ark. 633, 101 S.W.2d 785 (1937).

29. Central Coal & Coke Co. v. John Henry Shoe Co., 69 Ark. 302, 63 S.W. 49 (1901).

30. Peek v. Henderson, 208 Ark. 238, 185 S.W.2d 704 (1945).

§ 30–9. Trespass: removal of minerals and products

1. McGraw v. Berry, 170 Ark. 426, 280 S.W. 383 (1926) (coal).

28 REAL PROPERTY ty of the mineral, the cost of mining and preparing fully, the damages are assessed as the enhanced it for market, and the cost of transportation.2 value of the ore at the mouth of the mine at the time Because of the good faith of the trespasser, courts of the severance, with no reduction for the trespass- have been reluctant to award pre-judgment inter- er’s labor or expense.6 This “harsh rule” thus denies est.3 to the bad faith trespasser any profit from his tres- This royalty measure of “mild” damages against pass and indeed is punitive in forcing him to accept an innocent trespasser may not provide a full meas- the full costs of extraction.7 ure of recovery to a plaintiff who had the capability A good faith buyer of unlawfully mined ore is to extract the ore himself. Accordingly, such a plain- liable to the land owner for the value of the ore tiff should be entitled to recover the enhanced value taken,8 with the value determined according to the of the ore at the mouth of the mine, with a credit to preceding rules for good faith and bad faith tres- the non-willful trespasser for its reasonable cost of passers. In other words, if the good faith buyer pur- extraction.4 Only in this fashion is the plaintiff chases from a bad faith trespasser, he must pay the made whole by also recovering the profit he would higher value. have earned if he had been able to extract the ore Under the Arkansas statutes treble damages are with his own facilities. This “working interest meas- assessed against a trespasser in several instances: ure” is available only to plaintiff owners who had (1) digging or carrying away any stone, ground, clay, demonstrated an interest in working the land them- turf, mold, fruit, or plants; (2) cutting down or selves.5 Other owners are entitled to the “royalty removing any grass, grain, corn, cotton, tobacco, measure.” hemp, or flax; and (3) breaking the glass in a build- If the defendant, on the other hand, acted will- ing.9 The provisions are applicable to willful tres-

The defendant bears the burden of showing that the conversion was in good faith, and that it resulted from inadvertence or an honest mistake, not from a callous disregard of the property rights of others. Deltic Timber Corp. v. Great Lakes Chemical Corp., 2 F.Supp.2d 1192 (W.D.Ark.1998).

2. McGraw v. Berry, 170 Ark. 426, 280 S.W. 383 (1926); Deltic Timber Corp. v. Great Lakes Chemical Corp., 2 F.Supp.2d 1192 (W.D.Ark.1998) (royalty value or leasehold value for brine removed).

3. Young v. Ethyl Corp., 444 F.Supp. 207 (W.D.Ark.1977).

4. National Lead Co. v. Magnet Cove Barium Corp., 231 F.Supp. 208 (W.D.Ark.1964) (barite ore).

5. Killam v. Texas Oil & Gas Corp., 303 Ark. 547, 798 S.W.2d 419 (1990). See Gregory M. Power, Note: A Portrait of Uncertainty for Title Examiners and Mineral Interest Owners, 45 ARK. L. REV. 679, 693–97 (1992).

6. Ark. Power & Light Co. v. Decker, 179 Ark. 592, 17 S.W.2d 293 (1929) (sand and gravel).

7. National Lead Co. v. Magnet Cove Barium Corp., 231 F.Supp. 208 (W.D.Ark.1964). This approach to damages has also been applied to the removal of brine bearing bromine and other minerals through the underground injection of water under great pressures. Young v. Ethyl Corp., 581 F.2d 715 (8th Cir. 1978) (defendant acted in good faith, believing the course of action was legal). The Arkansas Supreme Court has modified the “rule of capture” by permitting the good faith use of secondary recovery processes for underground pools of valuable minerals, but by imposing on the extracting party “an obligation to compensate the owner of the depleted lands for the minerals extracted in excess of natural depletion, if any, at the time of taking and for any spe- cial damages which may have been caused to the depleted property.” Jameson v. Ethyl Corp., 271 Ark. 621, 609 S.W.2d 346 (1980).

8. McGraw v. Berry, 170 Ark. 426, 280 S.W. 383 (1926).

9. ARK. CODE ANN. § 18–60–102(a). See Howard v. Hicks, 304 Ark. 112, 800 S.W.2d 706 (1990) (remanded to determine whether trespasser who cut and removed 700 bales of hay was acting in good faith or bad faith). Actions for such statutory penal- 29 ARKANSAS LAW NOTES 2004 passers.10 Only single damages, together with costs, trolling, may be appropriate in ascertaining the are awarded against a trespasser who had probable value of the property at the time of the breach.6 cause to believe that the land or the item was his.11 However, the buyer is also entitled to interest on the difference from the time of the breach.7 This interest compensates the buyer for the use of the § 30–10. Breach of contract to convey: action by buyer bargain he would have attained if no breach had occurred. In addition, other consequential damages A contract for the sale of land is breached when may result from the seller’s breach. For example, the seller refuses to convey title. Likewise, the the buyer may be entitled to the reasonable cost of inability of the seller to deliver actual and immedi- temporary housing necessitated by the breach, pro- ate possession of the premises constitutes a breach vided that such losses were within the contempla- of the contract. The buyer is entitled to damages or tion of the parties and tacitly agreed to by the a return of the earnest money.1 The measure of dam- breaching seller. Likewise, the buyer may allege ages is the difference between the contract price and that the inability to acquire the property resulted in 2 the value of the land at the time of the breach. Only higher interest rates for the alternative property if the value of the land has risen will the buyer be subsequently acquired, and thereby the buyer may entitled to any general damages.3 In the absence of claim an interest rate differential. proof of the market value at the time of the breach,4 When the seller breaches, the buyer is usually the action fails for lack of proven damages.5 entitled to the expense of investigating the title Subsequent sales of the property, although not con- when that expense has been incurred.8 Attorney

ties must be brought within two years. Kutait v. O’Roark, 305 Ark. 538, 809 S.W.2d 371 (1991) (statutory remedy barred and landowner limited to common law right).

A plaintiff who proceeds in equity forfeits the right to seek treble damages under the statute. Gardner v. Robinson, 42 Ark. App. 90, 854 S.W.2d 356 (1993).

10. Schrader v. Schrader, 81 Ark. App.343, 101 S.W.3d 873 (2003) (neighbor had intentionally driven through vegetable gar- den, tossed trash in pond, and destroyed fences).

11. ARK. CODE ANN. § 18–60–102(c).

§ 30–10. Breach of contract to convey: action by buyer

1. Watson v. Calvin, 69 Ark. App. 109, 9 S.W.3d 571 (2000) (tenants still occupied property on date of scheduled closing).

2. Romer v. Leyner, 224 Ark. 884, 277 S.W.2d 66 (1955).

3. For example, Cole v. Salyers, 190 Ark. 53, 76 S.W.2d 669 (1934).

4. Green v. Ferguson, 263 Ark. 601, 567 S.W.2d 89 (1978).

5. For example, Romer v. Leyner, 224 Ark. 884, 277 S.W.2d 66 (1955).

6. Green v. Ferguson, 263 Ark. 601, 567 S.W.2d 89 (1978).

7. Miller v. Estate of Dawson, 14 Ark. App. 167, 686 S.W.2d 443 (1985); Kempner v. Cohn, 47 Ark. 519, 1 S.W. 869 (1886).

8. Romer v. Leyner, 224 Ark. 884, 277 S.W.2d 66 (1955). 30 REAL PROPERTY fees incurred by the buyer in connection with the Other remedies may also be available. If the con- thwarted purchase may be treated as reliance tractual deficiency is related to the quantity of land, expenditures and therefore recoverable damages. it may be corrected with an abatement in the pur- Further, attorney fees that are related to a success- chase price.13 When confronted with a deficiency in ful breach of contract litigation may be awarded title, the vendee has the option of accepting the under statutory law.9 However, the buyer may not recover for the profits he would have made upon an entire tract in its defective condition, with an appro- intended resale or lease of the property, for these priate abatement; taking only the portion to which damages are ordinarily too speculative, too remote, merchantable title can be given, again with an or not contemplated by the parties.10 appropriate abatement; or rescinding the entire con- Under the English case of Flureau v. Thornhill, tract.14 Assuming title does not present any prob- courts apply a different rule to a seller who is unable lems and the seller simply refuses to convey, the to provide good title as called for in the contract. buyer may elect the remedy of specific performance Such a good faith breaching seller is liable in resti- and assert a claim for incidental losses.15 The award tution only for the amounts that the buyer has paid on the contract, along with any reliance expendi- is based on principles of “equitable compensation,” tures made by the buyer. In keeping with the major- with the objective of contract performance and with ity of American states, Arkansas has rejected that monetary compensation for any losses incurred by English rule. The vendee in a real estate contract the delay in performance.16 ordinarily need only accept a title that he can hold Most conveyances contain covenants of title, by without reasonable apprehension of being chal- which the grantor agrees to indemnify the grantee if lenged and which is free from reasonable doubts the title fails. A general warranty deed typically con- affecting its value or interfering with its transfer- ability.11 If the seller breaches by virtue of a deficien- tains five covenants of title: seisin, right to convey, cy in title, the buyer is entitled to damages comput- quiet enjoyment, freedom from incumbrances, and 17 ed in the same fashion as for any other breach, general warranty. A breach of some covenants will including the recovery of his expectancy.12 support an action for restitution of the purchase

9. ARK. CODE ANN. § 16-22-308. See § 11-3, supra.

10. Kempner v. Cohn, 47 Ark. 519, 1 S.W. 869 (1886).

11. Baugh v. Johnson, 6 Ark. App. 308, 641 S.W.2d 730 (1982).

12. Vaughan v. Butterfield, 85 Ark. 289, 107 S.W. 993 (1908) (wife refused to relinquish dower interest).

13. Williams v. J. W. Black Lumber Co., 275 Ark. 144, 628 S.W.2d 13 (1982) (contract called for “tract of 640 acres, more or less,” but buyer received only 355 acres; abatement in purchase price granted). See Howard W. Brill, Specific Performance in Arkansas, 1995 ARK. L. NOTES 17, 23.

14. Baugh v. Johnson, 6 Ark. App. 308, 641 S.W.2d 730 (1982). See also Box v. Dudeck, 265 Ark. 165, 578 S.W.2d 567 (1979) (adjustment of purchase price to reflect the inchoate dower interest).

15. See, e.g., Stacy v. Lin, 34 Ark. App. 97, 806 S.W.2d 15 (1991) (buyer of Chinese restaurant entitled to specific performance and equitable compensation, rather than lost profits, for the losses incurred as a result of the delay in transferring).

16. Childs v. Adams, 322 Ark. 424, 909 S.W.2d 641 (1995); Miller v. Estate of Dawson, 14 Ark. App. 167, 686 S.W.2d 443 (1985).

17. Proffitt v. Isley, 13 Ark. App. 281, 683 S.W.2d 243 (1985).

31 ARKANSAS LAW NOTES 2004 price, in whole or in part.18 For a breach of the tract, the measure of damages is the difference covenant against incumbrances, the grantee may between the contract price of the land and its mar- recover from the grantor the amount necessary to ket value at the time of the breach.1 remove the incumbrances.19 But unless he has been If the value of the land at the time of the breach is higher than the contract price, either because of evicted or has satisfied the outstanding incum- general market appreciation or the shrewd bargain- brances, his recovery is limited to nominal dam- ing of the buyer, the seller has suffered no general 20 ages. damages because the land he retains is more valu- If the grantee retains the property, but is later able than the proceeds the sale would have yielded. compelled to defend the title against a third party, The court is to consider the fair market value of the the grantee is entitled to recover from the grantor land, rather than any subjective value to the owner.2 the expenses and costs of defending that lawsuit.21 Regardless of whether general damages are Likewise, a grantee who successfully initiates an awarded, the seller may be entitled to consequential action against a third party who claims adverse pos- damages that have flowed directly from the buyer’s session may recover the costs and expenses from the breach. For example, the seller may have incurred 22 grantor who warranted the title. expenses in preparing the land to convey to the breaching buyer.3 The seller may have made alter- ations in the property to comply with the wishes of § 30–11. Breach of contract to purchase land: action the buyer, which alterations will have no benefit, by seller and perhaps even be a detriment, to most prospec- tive buyers. Based on the contract to purchase a Upon the failure of the buyer to complete the residence, the seller may have acquired another res- purchase of land called for by the executory con- idence and is now obligated for the expenses on

18. Turner v. Eubanks, 26 Ark.App. 22, 759 S.W.2d 37 (1988) (conveyance of 229 acres to grantees limited by third party’s successful adverse possession claim to one acre).

19. Proffitt v. Isley, 13 Ark. App. 281, 683 S.W.2d 243 (1985). See Brown v. LeTourneau College, 251 Ark. 851, 475 S.W.2d 521 (1972) (incumbrance consisted of adjoining landowners’ perpetual water rights; damages of $1000).

20. Proffitt v. Isley, 13 Ark. App. 281, 683 S.W.2d 243 (1985).

21. Garmon v. Mitchell, 53 Ark.App. 10, 918 S.W.2d 201 (1996); Murchie v. Hinton, 41 Ark.App. 84, 848 S.W.2d 436 (1993).

22. Bosnick v. Hill, 292 Ark. 505, 731 S.W.2d 204 (1987).

§ 30–11. Breach of contract to purchase land: action by seller

1. McGregor v. Echols, 153 Ark. 128, 239 S.W. 736 (1922). Compare McMaster v. McIlroy Bank, 9 Ark.App. 124, 654 S.W.2d 591 (1983) (fair market value as of the date of performance of the contract). In calculating the market value of the land at the time of breach, the court may consider the price at which the land subsequently sold to a third party. Johnston v. Curtis, 70 Ark.App. 195, 16 S.W.3d 283 (2000) (property sold four months after scheduled closing).

The seller cannot recover damages in the absence of the written memorandum required by the Statute of . Blackmon v. Berry, 57 Ark. App. 1, 939 S.W.2d 863 (1997). See § 17–2, supra.

2. McMaster v. McIlroy Bank, 9 Ark. App. 124, 654 S.W.2d 591 (1983).

3. McIlvenny v. Horton, 227 Ark. 826, 302 S.W.2d 70 (1957) (cost of abstract, survey, escrow fee, broker’s fee and attorney fee).

32 REAL PROPERTY both. But the seller’s payment of utilities after the However, if the breach occurs after the buyer has breach and similar expenses are remote from the taken possession, rescission, though it may still be breach and are not recoverable.4 Similarly, conse- available, requires a more careful analysis of the quential damages do not include expenses in con- changes in the status of the parties. For example, nection with the subsequent sale to a third party.5 when a land sale contract was rescinded for viola- Frequently, the seller will have received a down tion of the rule against perpetuities, the buyer who payment or deposit of earnest money. Whether the had made 25 monthly payments on the contract was seller may retain that sum in lieu of establishing entitled to restitution for the taxes and insurance actual damages depends upon whether it is a valid paid, as well as the value of the improvements made 6 liquidated damages provision. The remedy of spe- on the land.2 Since the buyer had the benefit of the 7 cific performance may be available to the seller. use of the land during the life of the contract, he was not granted any recovery for the monthly payments made. § 30–12. Rescission of land sale contracts Similarly, upon failure of the seller to provide clear title to the land, the buyer is entitled to Land sale contracts may be rescinded for , rescind and recover the payments made under the for mistake, for breach of contract, and upon other contract. Whether the defect in the title is too grounds. A party wishing to rescind the contract insignificant to permit rescission is a question of may plead in the alternative. The substantive stan- fact for the court.3 When the contract is rescinded dards will vary significantly, but the techniques of because the vendor’s title fails, the vendor cannot accomplishing the rescission and restoring the par- recover from the buyer for the buyer’s use and occu- ties to their respective status prior to the contractu- pation of the land prior to rescission.4 al relationship are essentially similar. A buyer may rescind a contract for the purchase If the seller fails to perform within the time of land by establishing actionable fraud in the rep- called for in the contract, rescission with restitution resentations of the seller.5 In granting rescission 1 of the down payment is an appropriate remedy. several years after title passed to the buyer, the

4. Williams v. Cotten, 14 Ark.App. 80, 684 S.W.2d 837 (1985).

5. Johnston v. Curtis, 70 Ark.App. 195, 16 S.W.3d 283 (2000).

6. See § 8–2, supra.

7. Bharodia v. Pledger, 340 Ark. 547, 11 S.W.3d 540 (2000) (specific performance denied because seller had not complied with provision of contract).

§ 30–12. Rescission of land sale contracts

1. Worch v. Kelly, 276 Ark. 262, 633 S.W.2d 697 (1982); Kellum v. Gray, 266 Ark. 996, 590 S.W.2d 33 (Ark. App.1979); Watson v. Calvin, 69 Ark. App. 109, 9 S.W.3d 571 (2000) (buyer entitled to rescind when seller was unable to deliver actual possession of the premises on date of closing, due to continued occupancy by tenants). On rescission generally, see § 31–3, infra.

2. Comstock v. Smith, 255 Ark. 564, 501 S.W.2d 617 (1973).

3. Baugh v. Johnson, 6 Ark. App. 308, 641 S.W.2d 730 (1982).

4. Bates v. Simmons, 259 Ark. 657, 536 S.W.2d 292 (1976).

5. Ballard v. Carroll, 2 Ark. App. 283, 621 S.W.2d 484 (1981) (court sets forth a four-part test for rescission of contract based 33 ARKANSAS LAW NOTES 2004 court awarded the defrauded buyer the compensa- The court must consider the condition of the tion for the payments made on the purchase price, property at the time the buyers went into posses- the costs of necessary repairs and maintenance, and sion, the extent of ordinary wear and tear, the cost the taxes and insurance premiums paid. That of repair or restoration, and similar factors in amount was then reduced by the rental income 10 attempting to return the parties to the status quo. received by the buyer on the property. Adjustments for improvements placed on the land To rescind a contract for mistake, the buyer that increased the value of the must establish a material mistake of fact, combined property may also be appropriate.11 with good faith reliance upon the seller’s state- ment.6 For example, when both parties were mistak- Forfeiture provisions in land sale contracts are en as to the suitability of the land for construction, enforced when no substantial equitable circum- rescission was appropriate.7 In such a situation the stances demand the refusal of forfeiture.12 However, recovery is restitutionary in nature and is intended equity will seize upon slight circumstances that to restore the parties to their original positions. indicate a waiver by the seller in order to prevent When both parties seek cancellation of the con- forfeiture against the buyer.13 For example, the acts tract and rescission, the task of the court is to of the seller may lull the buyer into a sense of assur- restore the status quo as nearly as possible accord- 8 ance that late payments or other failures to comply ing to the principles of equity. For example, when with the terms of the contract will be tolerated; in the buyers were in possession for five years, they that instance equity is reluctant to grant a forfei- were entitled to the return of the monthly payments together with interest. The buyers were also obligat- ture, particularly when the buyer has made sub- ed to pay rent to the sellers for the time they occu- stantial payments on the total purchase price.14 pied the property together with interest on the Although equity abhors forfeitures, a buyer who rental value each month.9 wishes to exercise an option to withdraw from a

upon fraud). Constructive fraud will also support rescission. Cardiac Thoracic and Vascular Surgery, P. A. v. Bond, 310 Ark. 798, 840 S.W.2d 188 (1992).

6. Baugh v. Johnson, 6 Ark. App. 308, 641 S.W.2d 730 (1982).

7. Carter v. Matthews, 288 Ark. 37, 701 S.W.2d 374 (1986).

8. Bates v. Simmons, 259 Ark. 657, 536 S.W.2d 292 (1976).

9. Bates v. Simmons, 259 Ark. 657, 536 S.W.2d 292 (1976).

Income generated from the property and received by the buyer must be returned to the seller upon rescission. But if the property was unoccupied, unimproved, and non-income producing, equitable principles may not require the payment of the rea- sonable rental value. See Cardiac Thoracic and Vascular Surgery, P. A. v. Bond, 310 Ark. 798, 840 S.W.2d 188 (1992).

10. Bates v. Simmons, 259 Ark. 657, 536 S.W.2d 292 (1976).

11. Heifner v. Hendricks, 13 Ark. App. 217, 682 S.W.2d 459 (1985).

12. White v. Page, 216 Ark. 632, 226 S.W.2d 973 (1950); Hatfield v. Mixon Realty Co., 269 Ark. 803, 601 S.W.2d 894 (Ark.App.1980).

13. Humke v. Taylor, 282 Ark. 94, 666 S.W.2d 394 (1984); Hatfield v. Mixon Realty Co., 269 Ark. 803, 601 S.W.2d 894 (Ark.App.1980).

14. Triplett v. Davis, 238 Ark. 870, 385 S.W.2d 33 (1964). 34 REAL PROPERTY land sale contract without loss of the earnest money which the plaintiff, alleging he is legally entitled to or down payment must comply strictly with the the possession of the land, seeks to recover posses- terms of the withdrawal option.15 sion and damages.1 A plaintiff in ejectment may When a discrepancy exists between the property recover against a mere trespasser invading the to be conveyed and the contract, the purchaser may actual possession of the plaintiff.2 seek an abatement in the purchase price to compen- For the plaintiff to recover, he must establish sate for shortcomings in the title, quantity, quality, that at the commencement of the action, the defen- description, or other matters.16 A slight discrepancy dant was in possession of the premises and the in the amount of land is tolerable,17 but where the plaintiff had title or the right to possession.3 The acreage goes to the essence of the contract, the buy- plaintiff must succeed on the strength of his own ers are entitled to a reduction in the price because of title and cannot depend on the weakness of the 18 4 the deficiency. The court may give the sellers the defendant’s claim. An equitable title is generally option of accepting an abatement or rescinding the not sufficient to maintain an action in ejectment.5 19 entire sale. In defense to an ejectment action, a defendant § 30–13. Ejectment will frequently affirmatively plead adverse posses- sion.6 The doctrine, which protects one who honest- Ejectment is a legal remedy in circuit court by ly entered into possession of land believing it to be

15. Bollen v. McCarty, 252 Ark. 442, 479 S.W.2d 568 (1972).

16. Christy Co. v. Ainbinder/Searcy Ltd., 3 Ark. App. 63, 621 S.W.2d 886 (1981) (abatement of $25,000 to compensate for the cost of moving water lines; action based on fraud). See Howard W. Brill, Specific Performance in Arkansas, 1995 ARK. L. NOTES 17, 23.

17. Strout Realty, Inc. v. Burghoff, 19 Ark. App. 176, 718 S.W.2d 469 (1986) (discrepancy of two acres on 26 acres of rural resort land not sufficient to support rescission of contract).

18. Williams v. J. W. Black Lumber Co., 275 Ark. 144, 628 S.W.2d 13 (1982) (contract called for “tract of 640 acres, more or less,” but buyer received only 355 acres; abatement granted); Burk v. Hefley, 32 Ark. App. 133, 798 S.W.2d 109 (1990) (tract described as “19.65 acres, more or less” only contained 12 acres; but because property included a house and workshop, abatement properly denied).

19. Harris v. Milloway, 9 Ark. App. 350, 660 S.W.2d 174 (1983).

§ 30–13. Ejectment

1. ARK. CODE ANN. § 18–60–201ff; Dorey v. McCoy, 246 Ark. 1244, 442 S.W.2d 202 (1969). ARK. CODE ANN. § 18–16–201 pro- vides for an action of ejectment against a tenant who is six months in arrears in rent.

2. Wyatt v. Griffin, 242 Ark. 562, 414 S.W.2d 377 (1967) (defendants built a fence on plaintiff’s property).

3. ARK. CODE ANN. § 18–60–206. The plaintiff must set forth in the complaint “all deeds and other written evidences of title.” Ark.Code Ann. § 18–60–205. See DAVID NEWBERN, ARKANSAS CIVIL PRACTICE AND PROCEDURE, § 32–2 (2d ed. 1993).

4. Mikel v. Hubbard, 317 Ark. 125, 876 S.W.2d 558 (1994); Dorey v. McCoy, 246 Ark. 1244, 442 S.W.2d 202 (1969).

5. Scott v. Rutherford, 243 Ark. 306, 419 S.W.2d 595 (1967).

6. Mid-South Partitions, Inc. v. Brandon, 261 Ark. 317, 547 S.W.2d 764 (1977) (action brought to settle a boundary dispute).

35 ARKANSAS LAW NOTES 2004 his,7 has six elements.8 The adverse claimant must taxes nor color of title is essential to establish a establish that his possession was actual, open, claim to adverse possession when the claimants are exclusive, hostile in character,9 accompanied by an in actual possession.14 A party who claims title intent to hold adversely against the true owner, and through adverse possession under color of title is 10 continued for seven years. The acts of ownership deemed to be in constructive possession of the entire must be the type that the possessor would exercise tract if in actual possession of any portion of the over his own property, must be reasonably adapted tract.15 On the other hand, a trespasser who lacks to the land, and must be sufficiently open and visi- color of title has a heavier burden to successfully ble to give the true owner knowledge of the adverse assert an adverse possession claim.16 Without color possession.11 Possession of land that was originally of title, the claim is limited to that portion over permitted by the title owner can become adverse 17 only upon clear evidence of a change in relationship which the trespasser has actual possession. of the parties.12 The claim may be initiated in equity However, a 1995 statute has made acquisition of in a quiet title action, or raised in a court of law as title through adverse possession more difficult by a defense to ejectment.13 adding two requirements to the common law.18 The Under the common law, neither payment of adverse possessor must have color of title and have

7. Barclay v. Tussey, 259 Ark. 238, 532 S.W.2d 193 (1976).

8. Bonds v. Carter, 348 Ark. 591, 75 S.W.3d 192 (2002); Dillard v. Pickler, 68 Ark. App. 256, 6 S.W. 3d 128 (1999); Clark v. Clark, 4 Ark. App. 153, 632 S.W.2d 432 (1982). The six elements are frequently recalled with the acronym OCEANN: open, contin- uous, exclusive, adverse, notorious, and non-permissive.

9. The requirement of hostility does not mean a conscious feeling of ill will or enmity toward the neighbor. Walker v. Hubbard, 31 Ark.App. 43, 787 S.W.2d 251 (1990). A possessor is not adverse if he recognizes the ownership rights of the titlehold- er to the land in question. Fulkerson v. Van Buren, 60 Ark. App. 257, 961 S.W.2d 780 (1998).

10. The claimant may “tack on” the adverse-possession time of an immediate predecessor in title. White River Levee District v. Reidhar, 76 Ark. App. 225, 61 S.W.3d 235 (2001).

11. Anderson v. Holliday, 65 Ark. App. 165, 986 S.W. 2d 116 (1999) (drainage ditch). Adverse possession need not be dynam- ic or active. The adverse possessor of the land is not required to give actual notice to the landowner; constructive notice is suffi- cient. McLaughlin v. Sicard, 63 Ark. App. 212, 977 S.W. 2d 1 (1998).

12. Tolson v. Dunn, 48 Ark. App. 219, 893 S.W. 2d 354 (1995).

13. Kieffer v. Williams, 240 Ark. 514, 400 S.W.2d 485 (1966) (claimant sued in chancery court to establish her title by adverse possession and for injunctive relief); Howell v. Baskins, 213 Ark. 665, 212 S.W.2d 353 (1948) (in defense to an ejectment action, the defendant asserted adverse possession).

14. Howell v. Baskins, 213 Ark. 665, 212 S.W.2d 353 (1948).

A claimant who, acting under color of title, pays taxes for seven years in succession on unimproved and unenclosed land is deemed to be in possession of the land. ARK. CODE ANN. § 18–11–102. See § 13–7, supra.

15. St. Louis Union Trust Co. v. Hillis, 207 Ark. 811, 182 S.W.2d 882 (1944).

16. Moses v. Dautartas, 53 Ark. App. 242, 922 S.W.2d 345 (1996).

17. Clark v. Clark, 4 Ark. App. 153, 632 S.W.2d 432 (1982).

18. ARK. CODE ANN. § 18-11-106. For a comprehensive review of the legislative history and intent of the statute, see Shane P.

36 REAL PROPERTY paid real property taxes on the claimed property for dy.24 seven years. The statute also provides that the Under ejectment, the plaintiff, in addition to adverse possessor can satisfy these two require- recovery of possession, is entitled to damages and ments by having color of title to property contiguous costs.25 The statute provides for the rents and profits to the claimed property and paying taxes on this on the land down to the time of assessment.26 The contiguous property for seven years. The 1995 reasonable rental value of the land is the typical evi- statute is limited, however, to instances of actual dence offered to establish the statutory test of rents 27 adverse possession.19 The statute is not applicable and profits. Damages have also been based, in one to adverse possession claims that vested before instance, on the cost of removing a road constructed 1995.20 The companion remedy is a quiet title by the defendants on the plaintiff’s land. action, which was historically filed in equity, § 30–14. The mistaken improver and the betterment brought by a party who is in possession and desires statute that title be declared in him.21 That action, which may be based on the statute or the case law, is relat- Occasionally, a person will take possession of the ed to the equitable bill to remove a cloud on the land, and believing he is the owner, will improve the title.22 The claim may be based upon record title or land. Upon discovery that he is not the owner, he the elements of adverse possession.23 However, if the will also discover that under the common law, petitioner is not in possession, but claims legal title, improvements mistakenly made on the property equity has no role as ejectment is a complete reme- belong to the owner of the land, with no obligation

Raley, Note, Color of Title and Payment of Taxes: The New Requirements under Arkansas Adverse Possession Law, 50 ARK. L. REV. 489 (1997).

19. Schrader v. Schrader, 81 Ark. App. 343, 101 S.W.3d 873 (2003).

20. Liggett v. Church of Nazarene, 291 Ark. 298, 724 S.W.2d 170 (1987).

21. The quiet title statute is ARK. CODE ANN. § 18–60–501ff. See DAVID NEWBERN AND JOHN J. WATKINS, ARKANSAS CIVIL PRACTICE AND PROCEDURE, §§ 32–4, 32–5 (3rd ed. 2002); Joe E. Covington, Bills to Remove Cloud on Title and Quieting Title in Arkansas, 6 ARK. L. REV. 83 (1952).

A statutory quiet title claim can be brought only if the plaintiff can demonstrate a “perfect claim of title” or prima facie title through color of title and continuous payment of taxes on the land for seven years. Ark.Code Ann. § 18–60–506. See Brown v. Minor, 305 Ark. 556, 810 S.W.2d 334 (1991) (attorney fees assessed against a party for bringing a quiet title action without a reasonable basis).

22. Lynch v. Brunner, 294 Ark. 515, 745 S.W.2d 115 (1988); Cooper v. Cook, 220 Ark. 344, 247 S.W.2d 957 (1952) (claimants sued in equity to quiet title and based their claim on adverse possession); Potlatch Corp. v. Hannegan, 266 Ark. 847, 586 S.W.2d 256 (Ark. App.1979) (action in equity to quiet title based on adverse possession).

23. McKim v. McLiney, 250 Ark. 423, 465 S.W.2d 911 (1971).

24. Ark. Code Ann. § 18–60–207.

25. Ark. Code Ann. § 18–60–209.

26. See Fort Smith Warehouse Co. v. Friedman–Howell & Co., 111 Ark. 15, 163 S.W. 175 (1914); Jacks v. Dyer, 31 Ark. 334 (1876).

27. Dorey v. McCoy, 246 Ark. 1244, 442 S.W.2d 202 (1969) (judgment reversed on other grounds).

37 ARKANSAS LAW NOTES 2004 to provide compensation to the mistaken improver.1 which the defendant’s right to possession or enjoy- The Arkansas betterment statute amends that rule ment of the land is challenged.7 However, the and provides that any person who, believing himself statute does not permit the mistaken improver to to be the owner either in law or equity and acting affirmatively seek relief, but merely provides a under color of title, has mistakenly and peaceably means of asserting a counterclaim against the party improved the land of another may be entitled to seeking possession and damages. compensation for the value of the improvements The court awards the owner compensation for made upon the land and the taxes paid.2 any damage or waste to the land, together with The statute is applicable only when the person mesne profits for the preceding three years.8 Mesne acts in good faith and under color of title.3 Good faith profits are defined as the fair rental value of the consists of an honest belief and an ignorance that lands in their improved condition during the statu- any other person claims a better right to the land.4 tory period. The fair rental value is ascertained by Color of title refers to an instrument that passes deducting from the gross rental value the amounts what purports to be a title, but which is defective in expended for necessary repairs and the necessary form.5 An improver who benefits the land of another and customary management expenses.9 The but without color of title has no claim for compensa- improvements are valued not at cost,10 nor separate- tion.6 ly from the land, but are based upon the amount by The betterment statute is not limited to eject- which they have enhanced the value of the land ment actions, but may be raised in any action in itself.11 The owner’s lack of desire for the improve-

§ 30–14. The mistaken improver and the betterment statute

1. Jay N. Tolley, Note, Equity—Rights of a Mistaken Improver, 24 ARK. L. REV. 133 (1970).

Although the betterment statute is limited to actions for ejectment or trespass, a tenant in common seeking partition may seek indemnification from the other tenants for improvements made in good faith which have enhanced the value of the property. Graham v. Inlow, 302 Ark. 414, 790 S.W.2d 428 (1990). See Howard W. Brill, Equity: Real Property and the Problem of the Troublesome Neighbor, 1994 ARK. L. NOTES 1, 5.

2. Ark.Code Ann. § 18–60–213(a).

3. Berry v. Bierman, 248 Ark. 440, 451 S.W.2d 867 (1970).

4. Vernon v. McEntire, 234 Ark. 995, 356 S.W.2d 13 (1962). A person who improves property, knowing that the ownership is disputed in a divorce action, cannot claim reimbursement under the betterment statute. Jones v. Jones, 22 Ark. App. 179, 737 S.W.2d 654 (1987).

5. Baker v. Ellis, 245 Ark. 484, 432 S.W.2d 871 (1968); Acord v. Acord, 70 Ark. App. 409, 19 S.W.3d 644 (2000) (deed convey- ing only a life estate is not sufficient color or title).

6. Tolson v. Dunn, 48 Ark. App. 219, 893 S.W.2d 354 (1995).

7. For example, Crouch v. Crouch, 251 Ark. 1047, 476 S.W.2d 248 (1972) (partition action in equity); Neal v. Jackson, 2 Ark.App. 14, 616 S.W.2d 746 (1981) (chancery action to set aside will and deed).

8. Ark. Code Ann. § 18–60–213(d).

9. Crouch v. Crouch, 244 Ark. 823, 431 S.W.2d 261 (1968).

10. Smith v. Nelson, 240 Ark. 954, 403 S.W.2d 99 (1966).

11. Wallis v. McGuire, 234 Ark. 491, 352 S.W.2d 940 (1962). 38 REAL PROPERTY ments and, indeed, even his inability to profitably If the betterment statute is not applicable, the use the improvements, is irrelevant to their value improver may be authorized by statute18 or case and to the offset to be granted.12 law19 to remove the improvements from the land if The value of the improvements, which is deter- that task can be accomplished without substantial mined at the time of the recovery, cannot exceed the damage to the land. Further, if the improvements cost of making them or replacing them.13 The only are not removable, the mistaken improver may other limitation on the extent of the improvements assert a claim in unjust enrichment, relying in part seems to be that the improver may not “improve one on the maxim that “he who seeks equity must do out of his land.”14 equity.” But the case law offers little encouragement If the value of the improvements and the taxes to that unfortunate individual who may be viewed paid by the occupant exceed the award to the owner, as a volunteer or a meddler. Such a mistaken the court may not issue a writ of possession until the improver does not have the option of purchasing the improver has been paid the amount due him.15 The land upon which the improvements rest.20 Finally, improver is entitled to a lien on the lands for the Arkansas has a consistent policy of granting manda- amount due. In those proceedings, the owner is enti- tory injunctions to remove buildings or improve- tled to further recovery for the rent that accrues ments that encroach upon or are located upon the after the judgment.16 If the improvements add noth- property of another.21 ing to the value of the land, there is no recovery.17

12. Neal v. Jackson, 2 Ark. App. 14, 616 S.W.2d 746 (1981) (defendant had taken possession of land pursuant to a deed later held invalid).

13. McDonald v. Rankin, 92 Ark. 173, 122 S.W.88 (1909).

14. Crouch v. Crouch, 245 Ark. 67, 431 S.W.2d 261 (1968).

15. ARK. CODE ANN. § 18–60–213(c).

16. ARK. CODE ANN. § 18–60–213(e).

17. Crouch v. Crouch, 245 Ark. 67, 431 S.W.2d 261 (1968).

18. ARK. CODE ANN. § 18–60–105. The statute not only permits the improver to remove the construction, but also provides that the improver “shall not be held responsible for any damages to the owner of the adjoining lands.” That provision is arguably uncon- stitutional for violating the principle of Article 2, § 13 of the Arkansas Constitution that every person is entitled to a remedy for injuries suffered to his property. See Dendy v. Greater Damascus Baptist Church, 247 Ark. 6, 444 S.W.2d 71, 72 (1969) (Fogleman, J., concurring). The legislation should probably be viewed as eliminating nominal damages for the trespass, but not the actual damages caused by the construction or the removal.

19. Young v. Mobley Const. Co., 266 Ark. 935, 587 S.W.2d 837 (1979); Shick v. Dearmore, 246 Ark. 1209, 442 S.W.2d 198 (1969).

20. Smith v. Stewart, 10 Ark. App. 201, 662 S.W.2d 202 (1983).

21. See the cases collected in Smith v. Stewart, 10 Ark. App. 201, 662 S.W.2d 202 (1983). See Howard W. Brill, Equity: Real Property and the Problem of the Troublesome Neighbor, 1994 ARK. L. NOTES 1. 39