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Lane v. City of Kotzebue (7/9/99) sp-5140
Notice: This opinion is subject to correction before publication in
the Pacific Reporter. Readers are requested to bring errors to the attention of
the Clerk of the Appellate Courts, 303 K Street, Anchorage, Alaska 99501, phone
(907) 264-0608, fax (907) 264-0878.
THE SUPREME COURT OF THE STATE OF ALASKA
WILFRED LANE, )
) Supreme Court No. S-8357
) Superior Court No.
v. ) 2KB-95-00050 CI
CITY OF KOTZEBUE, ) O P I N I O N
Appellee. ) [No. 5140 - July 9, 1999]
Appeal from the Superior Court of the State of
Alaska, Second Judicial District, Kotzebue,
Richard H. Erlich, Judge.
Appearances: C.R. Kennelly, Stepovich,
Kennelly & Stepovich, Anchorage, for
Appellant. Jerald M. Reichlin, Fortier & Mikko, P.C., Anchorage,
Before: Matthews, Chief Justice, Compton,
Eastaugh, Fabe, and Bryner, Justices.
Wilfred Lane sued the City of Kotzebue for shutting off
his water and installing water and sewer lines on his property
without permission. He alleged negligence, trespass, and nuisance.
The superior court granted summary judgment for the City. Lane
appeals. We reverse because Lane has demonstrated both that there
are genuine issues of material fact with respect to his negligence
case, and that the superior court erred by entering a final
judgment dismissing his inverse condemnation claim absent a motion
for dismissal of that claim.
II. FACTS AND PROCEEDINGS
In the spring of 1992 Wilfred Lane discovered water
seeping from the ground between his house and a neighboring house.
Lane, a resident of the City of Kotzebue, called the City's
Department of Public Works. Upon inspection, the Department
concluded that the leak originated from Lane's service line.
Although it had previously assisted Lane with water problems, the
City now refused to do so. Instead, it shut off Lane's water
supply to prevent the City's main lines from being damaged by
freezing or loss of water pressure in Lane's lines.
Consequently, Lane's water and sewer lines froze, forcing
the seventeen-member Lane family to use an alternative water supply
and honey buckets. When Lane complained to the City, the City
offered to repair Lane's system. In exchange for the repair, the
City requested an easement for water and sewer lines it had
installed under Lane's property over ten years prior. Lane
rejected this offer.
Lane then sued the City. He alleged negligence and
nuisance with regard to the water shutoff and trespass with regard
to the water and sewer line installation. The City moved for
summary judgment on all claims.
The superior court dismissed Lane's negligence claim but
denied summary judgment on the nuisance claim. It also noted that
Lane's trespass claim should have been a claim for inverse
condemnation, denied summary judgment to the City as to the
trespass claim, stated that "the matter is not dismissed,"and gave
Lane an opportunity to amend his complaint. Lane did not amend his
After an unsuccessful attempt at mediation, the City
renewed its motion for summary judgment on the nuisance claim. In
response, Lane moved for a continuance under Alaska Civil Rule
56(f), but otherwise did not oppose summary judgment. The court
then entered a "Final Order"denying Lane's request for a
continuance, granting summary judgment to the City on the nuisance
claim, and dismissing "this matter." Lane appeals the dismissal of
his negligence and inverse condemnation claims. He does not appeal
from the dismissal of his nuisance claim.
A. Standard of Review
We review a grant of summary judgment de novo. [Fn. 1]
We will affirm a grant of summary judgment if there are no genuine
issues of material fact and the moving party is entitled to
judgment as a matter of law. [Fn. 2] We may affirm a superior
court's grant of summary judgment on any basis appearing in the
record. [Fn. 3] We review de novo as a question of law whether the
superior court erred by entering the final order, effectively
dismissing Lane's inverse condemnation claim. [Fn. 4]
B. Did the Superior Court Improperly Dismiss Lane's Negligence Claim?
Lane asserts that the court improperly granted summary
judgment to the City on his negligence claim. Because he
demonstrated the existence of a genuine issue of material fact, we
In seeking summary judgment, the movant must make a prima
facie showing demonstrating the absence of any genuine issue of
material fact. [Fn. 5] Once the movant has made this showing, the
non-movant must respond by demonstrating the existence of a genuine
issue of material fact bearing on each of its claims. [Fn. 6] The
court must resolve all reasonable inferences in favor of the non-
moving party. [Fn. 7]
Lane based his negligence claim on an assertion that the
City negligently connected his water line to the water line of Abe
Howarth's neighboring house, thereby triggering the problems that
caused the seepage he discovered in the spring of 1992. Because he
has offered no other basis for linking the City's actions to his
line failure, Lane's negligence claim depends on the existence of
The City offered as-built drawings depicting the absence
of an interconnection. The City employee who serviced Lane's line
and installed Howarth's line affied that the lines did not connect.
The same employee and the City's public works director also affied
that they had never seen lines configured in the fashion envisioned
by Lane's complaint.
To overcome the City's prima facie showing, Lane had to
produce evidence reasonably tending to dispute or contradict the
City's evidence. [Fn. 8] Lane submitted a transcript of his
deposition, where he testified that he was informed by City
employees that the lines were interconnected:
Q. What I'm trying to focus on is your line
and Mr. Howarth's line. And I'm asking you, how do you know that
they are joined together?
A. That understanding, what Randy [Walker]
and Charles [Foster] explained to me, because they were there
working up a storm and they were.
Q. So the best -- so the reason that you
think so is because that's what you were told by the City's
A. Yeah, yeah.
Q. When you spoke to the Public Works
director in 1994, did he tell you that the two lines were
A. To the best of my knowledge, yes, because
he said -- I was going to write a letter to the City about that.
That's the first time I ever find [sic] out about that too myself
where they explained to me that those two houses were connected to
Q. The Public Works director told you that
they were connected?
A. Yeah, not only him but also Charles and
We consider this testimony, and a similar passage elsewhere in his
deposition, sufficient to create a question about the existence of
an interconnection. In resolving all reasonable inferences in
Lane's favor, we assume the existence of an interconnection and
therefore allow the possibility that Lane's theory of negligence is
correct. [Fn. 9]
Without explicitly addressing the issue, the superior
court may have assumed that the statements Lane described in his
deposition were inadmissible hearsay. But an out-of-court
statement offered for the truth of the matter asserted is not
hearsay if it is an admission by a party-opponent under Alaska Rule
of Evidence 802(d)(2). The statements Lane described were uttered
by City employees during the course of their employment and
concerned matters that clearly fell within the scope of their
duties as they described them in their affidavits. Randy Walker
stated that he was involved with the "installation, maintenance,
repair, connection, disconnect and reconnect of water lines and
sewer lines for the City"; Herman Reich, the Public Works Director,
stated that he was responsible for the "care and maintenance of the
City's water and sewer utilities." To be admissible, the
statements Lane described did not have to be authorized by the
employer; it was enough that they concerned the employees' duties.
[Fn. 10] Nor did they have to be based on first-hand knowledge.
[Fn. 11] They met the requirements of Rule 802(d)(2).
Citing Yurioff v. American Honda Motor Co., [Fn. 12] the
City challenged the sufficiency of Lane's evidence. Yurioff's case
turned on the date of the accident giving rise to his claim; the
date determined whether the statute of limitations barred his
claim. By submitting medical records, depositions of the treating
medical personnel, and testimony by Yurioff admitting that the
accident probably occurred on that date, American Honda made a
prima facie showing that the accident had occurred on March 19,
1985. [Fn. 13] To counter this evidence, Yurioff offered only an
affidavit stating that he believed the accident had occurred on
We affirmed dismissal of Yurioff's lawsuit, remarking
that a prima facie showing cannot be rebutted with a mere scintilla
of contrary evidence:
To be sure, this statement rendered equivocal
Yurioff's admission that the accident occurred on March 19. Indeed
if a scintilla of contrary evidence were sufficient to create a
genuine issue of fact, we would agree with Yurioff that summary
judgment was improper. However, the question is whether Yurioff's
equivocation "reasonably tend[ed] to dispute or contradict"
authentic documentation of the date of the injury. We think that
it did not.[ [Fn. 14]]
Yurioff is distinguishable from Lane's case. First,
Yurioff established no plausible foundation for his equivocal and
problematic recollection of the critical date, whereas Lane based
his conflicting testimony on alleged admissions by City employees.
Second, the evidence that conflicted with Yurioff's recollection
originated with disinterested health care professionals who were
not parties to Yurioff's litigation. But the drawings and
affidavits the City offered were created or executed by City
employees. We conclude that it was error to grant summary judgment
to the City on Lane's negligence claim.
C. Dismissal of the Inverse Condemnation Claim
Lane next argues that it was error to dismiss his claim
for inverse condemnation. We agree.
In Count III of his original complaint, Lane asserted a
claim for trespass. The City argued that the six-year statute of
limitations for trespass barred this claim. Noting that Lane
should have asserted a claim in Count III for inverse condemnation
and not trespass, the superior court initially denied the City's
motion for summary judgment on that claim. Rather than dismissing
Count III, the superior court gave Lane an opportunity to amend his
complaint to replace the trespass claim with a claim for inverse
condemnation, but it set no deadline for the amendment. Lane never
amended his complaint. When the court later issued a final order
granting summary judgment on the nuisance claim, it stated that
"there [were] no other outstanding issues"and dismissed "this
matter." The final order addressed neither Count III nor any claim
for trespass or inverse condemnation. The superior court did not
explicitly dismiss Count III or any inverse condemnation claim, but
by dismissing "this matter"the final order effectively dismissed
The court erred in dismissing Count III of Lane's
complaint. The September 1997 order did not comply with the
requirements of Alaska Civil Rule 41 for the dismissal of claims.
[Fn. 15] The court did not inform Lane that he had to amend his
complaint to avoid dismissal. The court never formally dismissed
Lane's trespass claim, and it is arguable that Lane's original
pleading adequately asserted a claim of inverse condemnation. The
City never moved to dismiss an inverse condemnation claim. The
court never addressed such a claim on its merits, and never
dismissed the trespass claim for failing to state a claim on which
relief could be granted. Lane had no warning that the court might
dismiss this claim before it entered the September 1997 final
order. We therefore reverse.
D. Statute of Limitations
According to the City, any error in dismissing the
inverse condemnation claim was harmless because we can affirm
dismissal on independent grounds. [Fn. 16] The City first argues
that the statute of limitations barred Lane's claim.
In support of its contention, the City cites Fairbanks
North Star Borough v. Lakeview Enterprises. [Fn. 17] We there
applied the ten-year limitations period prescribed by AS 09.10.030
for real property disputes to Lakeview's inverse condemnation
claim. [Fn. 18] Because the City offered undisputed evidence that
it installed the water and sewer lines in 1977 and 1978, it
contends that AS 09.10.030 bars Lane's May 1995 claim.
In opposing summary judgment on his trespass claim, Lane
argued in the superior court that the statute should run from the
date of discovery rather than the date of installation. [Fn. 19]
He contended that leaks in the Howarth lines caused glaciation
which caused Lane's lines to crack. He could not have discovered
this hypothetical chain of causation until his line malfunctioned
and the City workers allegedly disclosed to Lane in December 1991
the existence of an interconnection. For this reason, Lane asserts
that his May 1995 complaint was timely.
We conclude that the portion of Lane's claim arising from
discoveries occurring within the ten years before he commenced suit
is not time barred. Lane directed his claim at the effects of the
installation of the lines on his property, not at the initial
installation. Moreover, Lane could not reasonably be expected to
have known about the interconnection until he spoke with City
employees. Because Lane's claim is directed at the installation's
secondary effects, which were not apparent until 1991, Lane's claim
was timely. [Fn. 20]
Our analysis is consistent with Lakeview, where a
landfill allegedly caused continuing damages. [Fn. 21] We there
recognized that damages arising from any new or additional injury
occurring within the ten years before suit was filed would not be
barred by the ten-year limitations statute. [Fn. 22] Similarly,
the limitations period does not bar Lane from recovering for
inverse condemnation damages caused by glaciation or freezing
occurring within the ten years before he filed suit.
This approach also accords with the way courts in other
jurisdictions treat the issue. They have held that the statute of
limitations begins to run when the owner has reasonable notice or
knowledge of the inverse condemnation:
It can be difficult to determine exactly when
the statute of limitations begins to run and when the owner's cause
of action accrues since there is usually no specific date that can
be shown as the date when the taking occurred. One rule that is
applied is the tort rule providing that the limitations period
begins to run on the date when the injury occurs or when the owner
has reasonable notice or knowledge of the injury or damage to the
land.[ [Fn. 23]]
E. Prescriptive Easement
The City also argues that any possible error in
dismissing Lane's inverse condemnation claim was harmless because
the City has established a prescriptive easement.
A party may establish a prescriptive easement by
demonstrating (1) continuous and uninterrupted use; (2) adverse
rather than permissive use; and (3) openness of use. [Fn. 24] The
City claims it met those requirements. Neither party appears to
dispute that the use was continuous and open. And the City argues
that the use was adverse rather than permissive because
construction of the lines involved dedication of State of Alaska
funds, reflecting an expectation of unhindered future use rather
than use subject to the owner's permission. [Fn. 25] It claims
that such a use would be openly adverse to Lane's interest.
Although the City's arguments appear superficially valid,
they do not justify affirmance. The parties did not argue this
issue in detail to either the superior court or this court, and the
record does not allow us to hold that there are no genuine,
material fact issues. Questions may exist about when Lane first
knew or had reason to know of the installation. Tolling issues may
arise. Neither party has discussed the history of the property's
ownership. Lane may have been misinformed about the legal status
of the Howarth lines. At one point, the City believed that it had
a previously existing easement between the two properties when it
installed the Howarth lines. It is conceivable that Lane may have
been informed of the City's belief and relied on it. We therefore
decline to rely on prescriptive easement in order to affirm.
F. Lane's Motion for a Civil Rule 56(f) Continuance
Lane also argues that the superior court erred in denying
his Civil Rule 56(f) continuance motion. [Fn. 26] This issue is
moot because we reverse the judgment for other reasons.
Because Lane offered sufficient evidence to raise a
genuine factual dispute about the existence of an interconnection,
we REVERSE the grant of summary judgment dismissing his negligence
claim. Because Count III of his complaint was never resolved, we
also REVERSE the final order of September 1997 and REMAND for
See Nielson v. Benton, 903 P.2d 1049, 1052 (Alaska 1995).
See In re Estate of Evans, 901 P.2d 1138, 1140 (Alaska 1995).
See Wright v. State, 824 P.2d 718, 720 (Alaska 1992).
See Ford v. Municipality of Anchorage, 813 P.2d 654, 655
See Yurioff v. American Honda Motor Co., 803 P.2d 386, 389
(Alaska 1990); see also Alaska R. Civ. P. 56.
See Brock v. Rogers & Babler, Inc., 536 P.2d 778, 782-83
See Bishop v. Municipality of Anchorage, 899 P.2d 149, 153
See Yurioff, 803 P.2d at 389.
See Bishop, 899 P.2d at 153.
See Klawock Heenya Corp. v. Dawson Constr./Hank's Excavation,
778 P.2d 219, 220 (Alaska 1989). See also Knight v. American Guard
& Alert, Inc., 714 P.2d 788, 794-95 (Alaska 1986); Rutherford v.
State, 605 P.2d 16, 23-24 (Alaska 1979).
See Rutherford, 605 P.2d at 24-25.
803 P.2d 386 (Alaska 1990).
See Yurioff, 803 P.2d at 389.
See Alaska R. Civ. P. 41(e) (providing for dismissal of a case
for want of prosecution).
See Alaska R. Civ. P. 61; see also Riley v. Simon, 790 P.2d
1339, 1342 (Alaska 1990).
897 P.2d 47, 54 (Alaska 1995).
See id. at 53-54. AS 09.10.030 provides that "[a] person may
not bring an action for recovery of real property, or for the
recovery of the possession of it unless the action is commenced
within 10 years."
In support, Lane cites Bauman v. Day, 892 P.2d 817, 827-28
(Alaska 1995), in which we held that purchasers' contract and fraud
claims arising from vendors' misrepresentations were not time
barred because the statute of limitations began to run on the date
of discovery. We have not previously applied the discovery rule to
Lane has not disputed that claims arising from the initial
installation of the sewer (i.e., claims for the diminution in value
created by its presence on his land) are time barred.
See Lakeview, 897 P.2d at 50-51.
See Lakeview, 897 P.2d at 54. Although we theoretically
allowed the possibility of recovery, we affirmed a directed verdict
against Lakeview on grounds of insufficient evidence. See id. at
Eugene McQuillin, The Law of Municipal Corporations sec.
(3d ed. 1991); see also Jungeblut v. Parish of Jefferson, 485 So.
2d 974, 978 (La. App. 1986) (statute of limitations commenced
running when owner discovered encroachment); Knox County v.
Moncier, 455 S.W.2d 153, 156 (Tenn. 1970) (statute of limitations
commenced running when owner reasonably understood extent of injury
See Weidner v. State, Dep't of Transp. & Pub. Facilities, 860
P.2d 1205, 1209 (Alaska 1993).
See id. at 1210.
Alaska Rule of Civil Procedure 56(f) provides:
Should it appear from the affidavits of a
party opposing the motion that the party cannot for reasons stated
present by affidavit facts essential to justify the party's
opposition, the court may refuse the application for judgment or
may order a continuance to permit affidavits to be obtained or
depositions to be taken or discovery to be had or may make such
other order as is just.