Hughes v. Insley

ON MOTION FOR RECONSIDERATION SALMON, J. Central to the resolution of the issues presented in this appeal is the application of the doctrine of claim preclusion. The doctrine of res judicata (also called direct estoppel or claim preclusion) applies when the parties to a subsequent suit are the same or in privity with the parties to a prior suit; the first and second suits present the same claim or cause of action; and there was a final judgment rendered on the merits in the first suit, by a court of competent jurisdiction. When those three elements are satisfied, the first claim is merged into the judgment in the first suit and the second claim is barred. For purposes of res judicata, whether claims are the same is determined by application of the “transaction test,” as set forth in section 24 of the Restatement (Second) of Judgments (1982).

See Kent County Bd. of Ed. v. Bilbrough, 309 Md. 487, 489-90 , 525 A.2d 232 (1987), which denotes a “claim” as including all rights of the plaintiff to remedies against the defendant with respect to all or any part of the transaction, or series of connected transactions, out of which the claim arose. The practical significance of this definition of a “claim” is that res judicata bars subsequent litigation not only of what was decided in the original litigation but also of what could have been decided in that original litigation. As the Court of Appeals explained in Alvey v. Alvey: a judgment between the same parties and their privies is a final bar to any other suit upon the same cause of action, and is conclusive, not only as to all matters that have been decided in the original suit, but as to all matters which with propriety could have been litigated in the first suit.... ⁶¹² 225 Md. 386, 390 , 171 A.2d 92 (1961). Chesley v. Goldstein & Baron, Chartered, 145 Md.App. 605, 622-23 , 806 A.2d 296 , cert. granted, 372 Md. 132 , 812 A.2d 288 (2002) (some citations omitted)(emphasis added).

In the subject case, the parties are at odds as to who owns 186 acres of land located in Dorchester County, Maryland. The trial judge ruled that an ejectment suit filed by the plaintiff, Margaret Hughes, was prohibited by the plaintiffs failure (in a prior suit to quiet title brought against the same defendant) to have prevailed in regard to the same “transaction” as that involved in the second case. The court also ruled that a prior counterclaim to quiet title asserted by defendant/counter-plaintiff, William Russell Insley, Jr., against Mrs. Hughes was similarly barred due to William Russell Insley, Jr.’s, failure (in that earlier counterclaim) to prevail. As a result of that ruling, the parties were left in legal limbo, inasmuch as Mrs. Hughes, who possesses legal title, could not prevent William Russell Insley, Jr., from using the land, and William Russell Insley, Jr., could use the land but was unable to assert legal title to it.

In this appeal, both parties claim that the trial court misapplied the doctrine of claim preclusion in regard to his/her claim. But, as to the opponent’s claim, both parties assert that the doctrine was correctly applied. I. THE LAND The disputed 186 acres is located in southern Dorchester County. To the east of the property is the Black Water WildLife Refuge, which is owned by the federal government; to the west lies Maple Dam Road, as well as several parcels of land owned by various members of the Insley family.

To the north is land owned by appellant, cross-appellee, Margaret Hughes (“Mrs.Hughes”). Land situated to the south of the 186-acre parcel is owned by Shirley R. Quidas and other third parties. The record title owner of the 186-acre parcel is Mrs. Hughes. She inherited the land from her grandfather, Charles H. Stewart, who died in 1948.

Mrs. Hughes, alone, ⁶¹³ paid taxes on the property continuously between 1948 and tax year 2000. In tax year 2001, property taxes on the land were paid by appellant, cross-appellee, William Russell Insley, Jr. (“Russell, Jr.”). About thirty or forty of the 186 acres in dispute were cleared, for farming purposes, by Russell, Jr.’s, father, William Russell Insley, Sr. (“Russell, Sr.”); the remainder of the 186 acres is made up of a combination of woodlands and wetlands. No one resides on the disputed property.

II

THE INSLEY CLAIM Russell, Jr., claims that members of the Insley family have adversely possessed the 186 acres since at least the 1930’s, when Curtis Insley regularly took timber off the property, used it for hunting and trapping, and excluded others from using it. Curtis Insley died, intestate, in 1960. According to Russell, Jr., and his mother, Lottie Mae Insley (“Lottie Mae”), after Curtis’s death, Russell, Sr., continued Curtis’s practice of treating the 186-acre parcel as if he owned it. As mentioned earlier, Russell, Sr., cleared thirty or forty acres of the property for purposes of farming; additionally, after Curtis Insley’s death, Russell, Sr., dug ditches and ponds on the property, took timber from the land, excluded others from entering onto it, erected no trespassing signs, hunted on the property, and gave permission to friends of his to hunt on the land.

Russell, Sr., died, testate, in January of 1992. In his will, he left all his property to his wife, Lottie Mae. The will named Lottie Mae as Russell, Sr.’s, personal representative. Russell, Jr., asserts that he has carried on activities on the property — similar to those engaged in by his father — since the date in January 1992 when his father died.

III

THE FIRST LAWSUIT In September 1992, approximately nine months after Russell, Sr., died, Mrs. Hughes, as record owner of the property, ⁶¹⁴ filed a suit in the Circuit Court for Dorchester County to quiet her title to the 186-acre parcel. 1 Mrs. Hughes alleged in her complaint that the 186-acre parcel was currently “vacant” and “unoccupied.” The complaint named as a defendant Lottie Mae and “all other persons having or claiming interest in” the subject property. Mrs. Hughes asked the court, pursuant to section 14-108(a) of the Real Property Article (“RP”) of the Maryland Code (1974, 1996 Repl.Vol.), 2 to determine that she had “absolute ownership and right of disposition of the disputed property.” She also asked that the court enjoin “each defendant claiming a hostile outstanding right from further asserting such claims.” Lottie Mae and Russell, Jr., filed answers to the complaint. The two also filed counterclaims, each of which was substantively identical. The counterclaims alleged that the counter-plaintiffs and their predecessors had been in “actual and/or constructive peaceable possession of the 186 acres in contro ⁶¹⁵ versy for more than twenty years” and that such possession had been “open, notorious, exclusive, and hostile against all others” for in excess of twenty years.

Both counter-plaintiffs asked that the court quiet their title to the 186-acre parcel and “grant declaratory relief establishing that counter-plaintiffs have absolute ownership and the right to disposition of’ the property. In February 1993, Lottie Mae executed and later filed a quitclaim deed in which she purported to convey all her rights, title, and interest in the 186-acre parcel to Russell, Jr. Lottie Mae’s deed, after describing the location of the lands, read, in part: Being all those lands acquired and owned by William Russell Insley, Sr. and Lottie Mae Insley, his wife, and which property evolved unto Lottie Mae Insley upon the death of William Russell Insley, Sr., by operation of law, as the surviving tenant by the entirety. On June 5, 1998, the circuit court entered partial summary judgment in favor of Mrs. Hughes on the issue of whether she held legal title to the subject property. Also on June 5, 1998, the court granted Mrs. Hughes’s motion in limine to exclude evidence of pendente lite adverse possession and prohibited reference by either party to things that had happened subsequent to September 30, 1992 — the date suit was filed.

Accordingly, the evidence in the 1992 suit was limited to events that occurred before Mrs. Hughes instituted suit. The first case came on for trial in July 1998. Russell, Jr.’s, counterclaim was considered by a jury, while Mrs. Hughes’s complaint to quiet title (an equitable claim) was decided by the Honorable Richard D. Warren. Russell, Jr., who was born in February 1958, did not claim in the first suit that he had personally adversely possessed the land for twenty years.

Instead, he claimed that his father (Russell, Sr.) had adversely possessed the land until his death in January 1992 and that he (Russell, Jr.) was entitled to “tack” his father’s possession onto his own because, (1) as a result of his father’s adverse possession, his father and Lottie ⁶¹⁶ Mae owned the 186 acres as tenants by the entireties; (2) upon Russell, Sr.’s, death, the property automatically became Lottie Mae’s; and (3) Lottie Mae conveyed her interest in the property to him by deed in February 1993. In closing argument, counsel for Mrs. Hughes pointed out the flaw in Russell, Jr.’s, claim that his adverse possession should be tacked to that of his father. Mrs. Hughes’s counsel argued: In other words, they have to be in your face for twenty years, in your face. The other things they need to do is when — they need to show that when Russell, Sr., dies, the baton is passed to Toadie [Russell, Jr.].

How does the baton get passed? There is no deed. There is no will. There is no gift.

There is no sale. There is no privity of estate. That’s what it is, privity of estate means you have got to have a deed, a sale, a gift, a will. You can’t just get it by being somebody’s child.

You can’t just get it by being somebody’s housemate. On a special verdict sheet the jury found: (1) that prior to September 30, 1992, neither Lottie Mae nor Russell, Jr., had received a deed or other written instrument purporting to convey the disputed property to them; (2) that Russell, Jr., was in actual, exclusive, open, notorious, visible, and hostile possession of the subject property, but that his possession had not been without interruption for at least twenty consecutive years prior to September 30,1992. Based on these answers, Judge Warren entered judgment against Russell, Jr., and Lottie Mae on their counterclaim and denied them “relief of Declaration of Title on Adverse Possession.” In regard to the complaint filed by Mrs. Hughes, judgment was granted in favor of Russell, Jr., and his mother. Judge Warren said, prior to granting judgment against Mrs. Hughes: The jury has found ... [the] facts, and the court is entitled, even in equity actions, to ask the jury to make findings of fact, that the defendants on the initial claim have been in actual[,] hostile, exclusive, open and notorious, and ⁶¹⁷ visible possession of the property for some period of time but not fully 20 years.

Based on that finding, the court finds that there has not been peaceable possession in the plaintiffs on the complaint for quieting of title, that being one of the two elements that are supposed to be established. Title was established but not the quiet possession. Enter judgment in favor of the defendants and against the plaintiffs on the initial complaint. No appeal was filed by any party from the judgments entered in the first action.

IV

THE SECOND LAWSUIT On October 25, 2000, Mrs. Hughes, by her son, Charles Hughes, as her attorney-in-fact, 3 filed a complaint for ejectment and other relief against Russell, Jr.; Lottie Mae, individually; and Lottie Mae, as personal representative of the estate of Russell, Sr. The complaint alleged that Mrs. Hughes was the record owner of the subject property; that by virtue of a final judgment dated July 13, 1998 (i.e., in the first case), “the court determined that the defendants, and each of them, had not acquired any ownership right in and to the subject property.” The complaint further alleged that the defendants had entered, and continued to enter upon and occupy portions of the subject property by “tilling part of the property, hunting on parts of the property, dumping and disposing of scrap tires and other solid waste thereon, cutting of trees on parts of the property, and have otherwise interfered with” Mrs. Hughes’s lawful right to possess the 186 acres. The complaint also alleged that the defendants were guilty of trespass in that they “entered upon and remained upon the” subject property “without authority or permission of’ Mrs. Hughes. The complaint asked that the defendants be ejected from the property ⁶¹⁸ pursuant to the provisions of RP section 14-108.1. Mrs. Hughes also asked that she be awarded possession of the property, compensatory damages, and other and further relief as the nature of her cause might require. 4 An answer to the complaint was filed by the defendants.

Russell, Jr., and Lottie Mae then filed a counterclaim and later an amended counterclaim. In the amended counterclaim, Russell, Jr., and Lottie Mae, individually and as personal representative, alleged that on April 4, 2001, Lottie Mae, in her capacity as personal representative of the estate of Russell, Sr., executed a deed of the subject property to herself, individually, as surviving spouse of Russell, Sr., pursuant to the terms of the decedent’s will, which had been admitted to probate in the Orphans’ Court for Dorchester County. 5 The counterclaim alleged that Russell, Sr., acquired “fee simple absolute title” to the subject property by virtue of his adverse possession of the property continuously and uninterruptedly for a period of twenty years prior to the initiation of the second suit by Mrs. Hughes; that the estate of Russell, Sr., acquired the land when Russell, Sr., died; and that Lottie Mae, in turn, acquired the land when she executed a deed, as Russell’s personal representative, conveying the land to herself on April 4, 2001. Lastly, the complaint alleged that Russell, Sr.; Lottie Mae; and Russell, Jr., individually, or jointly and severally, acquired the fee simple absolute title to the subject property by adverse possession. Mrs. Hughes filed an amended complaint in which she asked the court to declare that the deed to the subject property, dated April 4, 2001, which purported to convey title from Lottie Mae, as personal representative of Russell, Sr.’s, estate, to Lottie Mae, individually, be declared “null and void and of ⁶¹⁹ no force and effect nunc pro tunc ” and that the clerk of the court strike the April 4 deed from the land records of Dorchester County.

A bench trial was held, commencing February 2002, with the Honorable Marvin Smith, presiding. After hearing testimony from numerous witnesses concerning the issue of whether one or more of the Insleys had held the property by adverse possession for more than twenty years, Judge Smith found that “there’s enough here that I would hold that ... [Russell, Jr.] has the property by adverse possession.” Nevertheless, he ruled that the preclusive effect of the first suit barred Russell, Jr., from successfully asserting an adverse possession claim against Mrs. Hughes. Judge Smith likewise ruled that the doctrine of res judicata barred Mrs. Hughes from successfully prosecuting her ejectment and trespass claims. Additionally, Judge Smith dismissed Lottie Mae’s counterclaim insofar as it was filed in her capacity as personal representative of the estate of Russell, Sr. He opined that, because the estate had conveyed any ownership it had in the property, it was no longer an appropriate party to the counterclaim.

The trial judge also entered the following written declaratory judgment: The proceedings having been considered, it is this 19th day of April, 2002, declared by the Circuit Court for Dorchester County that title to the ... [subject property] is vested in Plaintiff/Counter Defendant, Margaret Mende Hughes free and clear of any claim by the Defendants/Counter Plaintiffs, William Russell Insley, Jr. and Lottie Mae Insley and the Estate of William John Russell Insley, Sr. Mrs. Hughes appealed the judgment entered against her. Russell, Jr., and Lottie Mae, individually, and as personal representative of Russell, Sr.’s, estate, filed a timely cross-appeal. ⁶²⁰ V. ANALYSIS A. Arguments of Russell, Jr. in His Capacity as Cross-Appellant 1. Russell, Jr.’s, Adverse Possession Claim — Without Reference to the Deed From Lottie Mae Although Russell, Jr., later makes a contradictory argument in his brief, one of the claims he asserts is that, even disregarding the adverse possession of his father, he owns the 186 acres because he has held the land adversely to Mrs. Hughes since 1976 when he turned eighteen years of age. According to Russell, Jr., the property became his on February 5,1996 — his thirty-eighth birthday.

Russell, Jr., maintains that the reason he lost the first case was that in 1992 — when the first case was commenced — he had only held the property adverse to Mrs. Hughes for approximately sixteen years and that because he was not allowed in the first case to put on evidence as to his adverse possession after September 30, 1992, it was unsurprising that the jury ruled against him. By contrast, by virtue of the counterclaim he filed in the second case, he was now able to show eight more years of adverse possession, i.e., the eight years (approximately) between the filing of the first and second lawsuits. There are at least two serious flaws in Russell, Jr.’s, argument. It is true that the filing of a suit to quiet title by Russell, Jr., did not stop the period of adverse possession from continuing.

But Russell, Jr.’s, argument overlooks the fact that Mrs. Hughes defended against his suit to quiet title. When Mrs. Hughes interposed a defense to Russell, Jr.’s, counterclaim, the assertion of that defense did interrupt the period of his adverse possession. See Rosencrantz v. Shields, Inc., 28 Md.App. 379, 394-95 , 346 A.2d 237 (1975). In Rosencrantz , the record title owner was Shields, Inc. Id. at 381 , 346 A.2d 237 .

The Rosencrantzes’ immediate predecessor in title, Jesse Smith, had held the disputed property by ⁶²¹ adverse possession, commencing in May 1953. 6 Id. The Rosencrantzes purchased land bordering on the disputed property in May of 1964 and thereafter proceeded to hold the disputed property adversely to Shields, Inc. Id. at 383-84 , 346 A.2d 237 . In October 1971, the Rosencrantzes filed a trespass, quare clausum fregit, suit alleging adverse possession against Shields, Inc., by the Rosencrantzes and their predecessors in title. Id. at 383 , 346 A.2d 237 .

A judgment was entered in favor of Shields, Inc., due to a failure by the Rosencrantzes to show sufficient privity between Jesse Smith and his predecessor in title. Id. at 383-85 , 346 A.2d 237 . This meant that the earliest date that the Rosencrantzes could claim adverse possession was February 1953. Id. at 385-86 , 346 A.2d 237 .

This also meant, of course, that, as of the date that suit was filed in 1971, the Rosencrantzes could show adverse possession for only eighteen years. Id. at 386 , 346 A.2d 237 . After losing the first suit, the Rosencrantzes, in May 1974, filed a suit to quiet title against Shields, Inc. Id. at 381 , 346 A.2d 237 . In their second suit, the Rosencrantzes claimed that they (and their predecessors) now had held the disputed parcel for twenty years and that their unsuccessful 1971 suit did not interrupt the twenty-year period.

We held that, while filing of the suit by the Rosencrantzes did not interrupt the period of adverse possession, the filing of a defense by Shields, Inc., did interrupt the twenty years. Id. at 394 , 346 A.2d 237 . In regard to the Rosencrantzes’ claim, Judge Jerrold Powers, for this Court, said: If an action of ejectment, trespass to try title, or other appropriate action for the recovery of its corporeal estate in the land had been commenced by, rather than against, Shields, the filing of the action on 1 October 1971 would have interrupted the continuity of the adverse possession. ⁶²² Id. But the interruption did not take place with the commencement of the action, because the filing of suit by Mr. and Mrs. Rosencrantz was not an assertion of rights by Shields.

It was the defense by Shields to the suit which constituted an assertion by it of an opposing right. It was that opposing claim by Shields which, when successfully prosecuted to judgment, interrupted the adverse possession. The only remaining point which requires notice is that, even after it was adjudicated to hold title superior to that of appellants, Shields has not physically retaken possession. Mr. and Mrs. Rosencrantz have remained as before.

We hold that this failure of Shields to reenter did not impair its right to do so. At most, the appellants started over again, from zero, on a new period of adverse possession. The author says in 5 Thompson, Commentaries on the Modem Law of Real Property, § 2552, at 572-73 (Grimes repl.1957): “Possession by the adverse claimant must be uninterrupted for the full statutory period, for to break effectively the possession at any time before the period has fully expired will arrest the running of the statute. The moment the running of the statute of limitations is interrupted the law restores the possession to the holder of the legal title, and the claimant by adverse possession must begin de novo.

Upon interruption of the possession before completion of the statutory period, the possession of the true owner constructively intervenes, and should the claimant resume possession, the statute of limitations begins to run at the date of such resumption, and must run for the full statutory period thereafter in order to give the claimant title. If the possession be interrupted, either by fraud or force, or by process of law, the statute begins to run only from the time of reentry.” Id. at 394-95, 346 A.2d 237 . Based on the Rosencrantz case, we reject Russell, Jr.’s, claim that he, personally, held the property uninterruptedly between February 1976 and February 1996. The reason for ⁶²³ this is the same reason we rejected the Rosencrantzes’ claim, i.e., Russell, Jr.’s, adverse possession was interrupted by Mrs. Hughes’s filing a defense to Russell, Jr.’s, counterclaim (in the first suit) in which he sought to quiet title.

That defense was filed on February 16, 1993. Therefore, he has not personally held the land continuously since February 1976. A second reason that we reject Russell, Jr.’s, argument that he holds title to the property, even without considering the deed he received from Lottie Mae, is that there was no evidence presented that Russell, Jr., ever held the disputed property adversely to anyone prior to his father’s death in January 1992. The uncontradicted evidence in this regard was that starting in 1960, when Russell, Sr.’s, father died, and until January 1992, when Russell, Sr., died, Russell, Sr., farmed, timbered, hunted, trapped, and otherwise held the disputed property adversely to all others.

In fact, Russell, Jr., admits as much in another section of his brief, where he says: During Russell Sr.’s life he acquired prescriptive title to the ... property [in dispute] either by descent from his father Curtis, who died in 1960, or independently in his own right, by virtue of his open, notorious, visible, exclusive, continuous, hostile, and adverse possession for his entire life until his death at age 71 in 1992. 2. Russell, Jr.’s, Claim that He Holds the Property by Virtue of a Deed Conveying Russell, Sr.’s, Estate’s Interest in the Property Both parties agree that the evidence in the first and second case was, in large