Legal expenses incurred in clearing title are “special damages” that can sustain a slander-of-title claim

Massucco v. Kolodziej, 2024 VT 76 (filed 11/27/2024) (Affirms orders reforming deed and finding slander of title, holding as a matter of first impression that legal expenses incurred in clearing title are “special damages” that can sustain a slander-of-title claim.)

WAPLES, J.   Defendants James and Barbara Kolodziej discovered that a parcel of land near their property was seemingly omitted from plaintiff Sarah Massucco’s deed.  They arranged for the heirs of a previous owner of the land to deed that parcel to them.  Defendants neither talked to plaintiff—who they saw use the parcel—nor confirmed that the heirs owned the parcel.  After recording their own deed, defendants informed plaintiff that they owned the parcel and asked her to remove her belongings.  Plaintiff sued.  The trial court granted plaintiff’s claim for deed reformation on summary judgment and concluded Mr. Kolodziej slandered plaintiff’s title after a bench trial.  Defendants appeal and we affirm. 

To reform her deed, plaintiff must demonstrate, beyond a reasonable doubt, that the deed fails to express the real agreement between seller and buyer due to a mutual mistake in reducing the agreement to writing.  Cassani v. Hale, 2010 VT 8, ¶ 17, 187 Vt. 336, 993 A.2d 422.  “Mutual mistake is shown if the evidence establishes that the seller intended to sell and the buyer intended to purchase a different piece of land than that described in the deed.”  LaRock v. Hill, 131 Vt. 528, 530, 310 A.2d 124, 126 (1973).  The court may reform a deed to what “the deed and extrinsic evidence indicate [the parties] must have intended.”  Cassani, 2010 VT 8, ¶ 19.  “Intent is rarely proved by direct evidence; it must be inferred from a person’s acts and proved by circumstantial evidence.”  State v. Langdell, 2009 VT 125, ¶ 9, 187 Vt. 576, 989 A.2d 556 (mem.) (quotation omitted).

 

 Defendants contend that the language of the Leisey deed precludes summary judgment. But  Plaintiff does not dispute that the Leisey deed facially omitted the disputed parcel.  Her claim is that the deed does not reflect the true agreement between the Adamses and Mr. Leisey.  The undisputed text of the deed alone does not bar a grant of summary judgment on a reformation claim.

 Even if Mr. Leisey was hazy on the specific details of the parcel’s boundary the facts set forth by defendants do not create a genuine dispute of fact for trial.  The unrefuted deposition testimony demonstrated that the Adamses intended to convey their whole remaining parcel to Mr. Leisey, Without any disputed material facts presented, the trial court appropriately granted summary judgment on plaintiff’s claim for reformation of the Leisey deed and the deeds in her line of title. 

To prove slander of title, plaintiff must show that: (1) she has a “transferrable ownership interest capable of disparagement,” (2) defendants published a false statement concerning plaintiff’s title; (3) defendants acted with malice, and (4) the statement caused special damages.  Sullivan v. Stear, 2011 VT 37, ¶¶ 8, 11, 189 Vt. 442, 23 A.3d 663.[1] ‘The essence of the tort is the publication of an assertion that is derogatory to the plaintiff’s title to property in an effort to prevent others from dealing with the plaintiff.”  Id. ¶ 8 (quoting Wharton v. Tri–State Drilling & Boring, 2003 VT 19, ¶ 14, 175 Vt. 494, 824 A.2d 531 (mem.)).[2]

 

(1)

 

There is a split among the states as to whether land acquired through adverse possession can support a slander-of title claim. We conclude that title by adverse possession “is a sufficient interest in property for a claimant to maintain an action for slander of title.”  Colquhoun v. Webber, 684 A.2d 405, 409-10 (Me. 1996). In Colquhoun, the Maine Supreme Judicial Court looked to the Restatement (Second) of Torts, which provides that a legally protected interest in land “may be disparaged if the interest is transferable.” . Restatement (Second) of Torts § 624 cmt. c (1977).  Because in Maine an adverse possessor has good title after having met the requirements for adverse possession, that title can sustain a slander-of-title claim even before judicial confirmation of the title.  Colquhoun, 684 A.2d at 410.  We hold the same here.  .  Plaintiff thus had the title necessary to sustain her slander-of-title claim, even before the court order reforming the Leisey deed becomes final. 

(2)

The trial court concluded that the recording of the deed constituted publication of a false statement concerning plaintiff’s title.  We agree.  By recording a deed that amounted to a false claim of ownership of the disputed parcel, Mr. Kolodziej published a false statement concerning plaintiff’s title.

(3)

Malice in a slander-of-title action requires “conduct manifesting personal ill will, evidencing insult or oppression, or showing a reckless or wanton disregard of plaintiff’s rights.”  Though the court found that Mr. Kolodziej “did not have personal ill will” towards plaintiff, he “acted with reckless disregard of the possibility that she had a claim to the disputed property.”  --The undisputed evidence demonstrates that Mr. Kolodziej located a parcel of land where the deeds in the land records did not comport with town maps or with plaintiff’s usage of the land.  He then arranged to have the parcel deeded to himself and his wife without speaking to the person who he saw had been using the.This evinces a “reckless disregard” for plaintiff’s rights.. The trial court applied the correct legal standard, and we see no error in the conclusions it drew.

(4)

We have never clarified what might constitute special damages for a slander-oftitle claim in Vermont.  We have affirmed dismissal of a claim of slander of title for lack of evidence tying “any damages to the alleged slander.”  Gardner v. West-Col, Inc., 136 Vt. 381, 387, 16 392 A.2d 383, 387 (1978) (quotation marks omitted).  We have also squarely held that pecuniary losses from a lost sale of the property at issue suffice to establish special damages.  Wharton, 2003 VT 19, ¶¶ 15, 18.  We must now decide whether evidence of damages in the form of legal expenses incurred in clearing title are “special damages” that can sustain a slander-of-title claim.  We conclude that they are.

Fees expended in prosecuting the slander-of-title action are not recoverable as special damages in that action, but the costs of actions taken to clear a plaintiff’s title and such other expenses that are reasonably necessary to counteract the disparagement” constitute “special damages for which the tortfeasor should bear liability.

 

We affirm the trial court’s grant of summary judgment to plaintiff on her claim for reformation of the deeds in her line of title.  We further conclude that her reformed deed relates back to the grant of the original deed, and that plaintiff’s interest in the disputed parcel can sustain her slander-of -title claim even before judicial confirmation of the deed reformation becomes final.  Finally, we conclude that attorney’s fees and costs expended in clearing her clouded title constitute the special damages necessary to sustain plaintiff’s slander-of-title claim.  

Affirmed. 

---

SCOVT NOTES Re Elements of Slander of Title in Vermont precedent:

[1] Sullivan v. Stear, 2011 VT 37, ¶¶ 8, 11 (“To prove slander of title, plaintiff must show that: (1) defendants published a false statement concerning plaintiff's title; (2) the statement caused special damages; and (3) defendants acted with malice. Wharton v. Tri-State Drilling & Boring, 2003 VT 19, ¶ 14, 175 Vt. 494, 824 A.2d 531 (mem._) . . . Whether a statement concerns a person's title revolves around whether it affects that person's ability to make deals with others regarding the property disparaged. Wharton, 2003 VT 19, ¶ 14, 175 Vt. 494, 824 A.2d 531. In other words, one claiming slander of title must have a transferrable ownership interest capable of disparagement. Restatement (Second) of Torts § 624 cmt. c ("Any kind of legally protected interest in land, chattels or intangible things may be disparaged if the interest is transferable and therefore salable or otherwise capable of profitable disposal.").

 

[2] Wharton v. Tri–State Drilling & Boring, 2003 VT 19, ¶ 14(“The elements of slander of title as a cause of action have not been clearly laid out in Vermont. The tort has been recognized by this Court, however, first in a nineteenth century case in which we declared that we had jurisdiction over claims for slander of title, Sherman v. Champlain Transportation Co., 31 Vt. 162 (1858), and next in a more recent case where we held that an essential element of the cause of action for slander of title is special damages. Gardner v. West-Col, Inc., 136 Vt. 381, 387, 392 A.2d 383, 386 (1978). The essence of the tort is the publication of an assertion that is derogatory to the plaintiff's title to property in an effort to prevent others from dealing with the plaintiff. See Prosser and Keeton on Torts § 128, at 967 (5th ed.1984). To prove slander of title, a plaintiff must prove that a defendant falsely published a statement concerning plaintiff's title that caused special damages to the plaintiff and that defendant acted with malice. Restatement (Second) of Torts §§ 623A, 624 (1977)”)

Relief from judgment under Rule 60 is available only to parties -- even though movant did not have notice and opportunity to become a party.

 

 In Re Burchard Road Petition To Abandon Land Use Permit Denial, 2024 VT 51 (Neighbor, a party to the original act 250 proceeding who lives in New Jersey, did not receive notice of a request to abandon the Act 250 permit because the post office did not deliver a “notice to interested persons” mailed by the district commission to Neighbor’s Vermont street address.  The Environmental Court issued a final judgment and later denied Neighbor relief from judgment under Rule 60 -- as applied to Environmental Court and as affirmed by the Supreme Court-- because relief under Rule 60 is available only to a “party”.)

 REIBER, J. . Neighbor Myrna Nathin appeals the denial of her motion for relief from a judgment of the Environmental Division declaring an Act 250 land-use permit for an adjoining property to be abandoned. Neighbor argues that the Environmental Division should have vacated the order and reopened the abandonment proceeding because she was not provided with adequate notice of the petition to abandon the permit. We conclude that the Environmental Division properly denied neighbor's motion under Vermont Rule of Civil Procedure 60(b) and therefore affirm the decision below.

 Neighbor, whose property abuts a portion of the subject property, was granted party status in the 1990 permit proceeding filed a petition with the district commission to abandon the permit pursuant to 10 V.S.A. § 6091(b) and provided the district commission with a list of interested persons, including neighbor. In August 2022, the district commission declined to review the petition, reasoning the superior court had jurisdiction over the permit. The district commission sent copies of its decision to all interested persons and entities, including neighbor at the address that landowners provided. Landowners appealed to the Environmental Division and in September 2022 published public notice of the appeal in a local newspaper. Following proceedings in which neighbor did not appear, the Environmental Division entered a stipulated judgment and order on January 9, 2023, ruling that the permit was abandoned. No appeal was taken from that order.

  Nine months later, in October 2023, neighbor filed a motion for relief from judgment pursuant to Vermont Rule of Civil Procedure 60(b), asking the Environmental Division to "void" the January 2023 order and reopen the abandonment proceeding. Neighbor, who lives in New Jersey, asserted that she did not receive the notice mailed by the district commission to her Vermont street address because the post office does not deliver mail there.  In January 2024, the court denied neighbor's motion, concluding that she lacked standing to file a Rule 60(b) motion because she was not a party. See V.R.C.P. 60(b) (stating that upon motion, "the court may relieve a party or a party's legal representative from a final judgment, order, or proceeding" (emphasis added)).

 As a party to the original permit proceeding, neighbor was entitled to receive notice of the abandonment petition. Act 250 Rule 38(D Neighbor's primary argument on appeal is that because the district commission's notice to her was ineffective, the Environmental Division was required by this Court's decision in In re Conway, 152 Vt. 526, 567 A.2d 1145 (1989), to vacate the January 2023 abandonment order and reopen the proceeding so that she could participate.

 However, we rejected this interpretation of Conway in In re White, 172 Vt. 335, 339, 779 A.2d 1264, 1268 (2001). There we emphasized that "Conway does not require the Board to void or revoke permits merely based on the inadvertent omission of an adjoining landowner from the list required on permit applications no matter when this oversight is discovered." Id. at 341, 779 A.2d at 1269 Here, as in White, the permit abandonment process had already become final when neighbor filed her Rule 60(b) motion seeking to reopen the abandonment order. Unlike in Conway, there is no suggestion that the lack of notice to neighbor was intentional. Instead, the record shows that landowners provided neighbor's name and Vermont address to the district commission, and the district commission sent notice of its decision declining jurisdiction to that address. There is no evidence that landowners knew the address would be ineffective. Most importantly, the district commission did not fail to adhere to its own rules or improperly delegate its discretion over who should receive notice. Just as Conway does not automatically require a permit to be voided or revoked when an adjoining landowner is inadvertently omitted from a permit application, nothing in Conway required the Environmental Division to vacate the abandonment order here.

 On its face, Rule 60(b) allows relief from judgment only to "a party or a party's legal representative." Consistent with this plain language, federal courts have recognized that "the general rule is that one must either be a party or a party's legal representative in order to have standing to bring any Rule 60(b) motion." Kem Mfg. Corp. v. Wilder, 817 F.2d 1517, 1520 (11th Cir. 1987) (collecting cases). Neighbor never appeared in the Environmental Division when it considered landowners' petition to abandon the permit. Neighbor was not a party or the legal representative of a party to the Environmental Division proceeding, and therefore is not entitled to seek relief under the plain language of the rule.

 Neighbor claims that the January 2024 denial of her Rule 60(b) motion for lack of standing was contrary to the Rules of Environmental Court Proceedings and was inappropriate given the lack of formal notice in environmental appeals. Neighbor points to Environmental Rule 5(a)(2), which makes the Rules of Civil Procedure apply only "so far as applicable," and to Environmental Rule 1, which requires that the rules "be construed and administered to ensure summary and expedited proceedings consistent with a full and fair determination in every matter coming before the court." V.R.E.C.P. 1, 5(a)(2). Neighbor argues that unlike other civil cases, putative parties in Environmental Division proceedings do not receive a summons pursuant to Vermont Rule of Civil Procedure 4. Absent such an assurance of notice, neighbor argues, restricting Rule 60(b) to parties undermines the requirement of providing a "full and fair determination in every matter." V.R.E.C.P. 1. She asserts that "party status must be broadly interpreted in cases reaching a court without a Rule 4 summons." 

In short, Neighbor claims that party status for purposes of Rule 60(b) should be broadly interpreted in environmental appeals because putative parties do not receive notice consistent with Rule 4 in such proceedings.

 Party status in Act 250 proceedings is governed by statute and is limited to a list of specific individuals and entities. Neighbor's sweeping contention that nonparties should be allowed to file Rule 60(b) motions in any case where putative parties are not entitled to a Rule 4 summons would effectively allow anyone to intervene after judgment in any environmental appeal. This would ignore important principles of finality; create significant uncertainty over permitting decisions, leaving them open to attack for up to a year and possibly longer under Rule 60(b); and conflict with Act 250 and our precedent governing party status in such cases. For these reasons, we decline to adopt neighbor's proposed interpretation of who is a "party" for purposes of Rule 60(b) in an environmental case.

 Nothing in Environmental Rule 2 or 5 modifies Civil Rule 60 in environmental proceedings or renders the rule inapplicable to this case. The general statement in Environmental Rule 1 that "[t]he rules shall be construed and administered to ensure summary and expedited proceedings consistent with a full and fair determination in every matter coming before the court" does not eliminate the procedural requirements of the Civil Rules. A denial of relief for failure to comply with the plain terms of Rule 60(b) amounts to a "full and fair determination" of the matter because the party has received everything that they are entitled to under the rules. We therefore see no basis to disturb the decision below.

 Affirmed.

  

Divided Court reverses denial of motion to suppress breath test, holding officer may not require DUI suspect to elect whether to take a second test before providing results of first test.

 

Statev. Ettore, 2024 VT 52 [filed 8/30/2024]

 

COHEN, J. In this interlocutory appeal, defendant Eileen Ettore challenges the trial court’s denial of her motion to suppress an evidentiary breath-alcohol test, which she filed in both her criminal and civil dockets. We agree with defendant that, under the plain language of 23 V.S.A. §§ 1202(d)(5) and 1203(c), law enforcement must provide a suspect with the results of their first breath test before requiring the suspect to elect whether to take a second test. We reverse the court’s decision and remand for additional proceedings in the criminal case and for entry of judgment in defendant’s favor in the civil suspension proceedings.

Defendant argued below that the officer violated her implied-consent rights by asking her if she wanted a second test before informing her of the results of the first test. The relevant language in the informed-consent statute is as follows:

At the time a test is requested, the person shall be informed of the following statutory information: . . .

 A person who is requested by a law enforcement officer to submit to an evidentiary test administered with an infrared breath-testing instrument may elect to have a second infrared test administered immediately after receiving the results of the first test.

23 V.S.A. § 1202(d)(5). Section 1203(c) provides that “[a] person tested with an infrared breath-testing instrument shall have the option of having a second infrared test administered immediately after receiving the results of the first test.”  

The trial court concluded in relevant part that defendant’s right to be informed about the ability to elect a second breath test matured at the time the officer requested an evidentiary breath sample under and that the officer properly informed defendant of her implied-consent rights, including her right to request a second breath test upon receiving the results of the first, before she took the first test.

We disagree and conclude, based on the plain language of the laws, that the Legislature intended that suspects possess the necessary information to make an informed decision about the exercise of their statutory rights. The officer asked defendant if she wanted a second test before she was provided the results of the first test. Without the test results, defendant could not make a fully informed decision about whether to request a second test. The process laid out by statute was not followed.

Mindful of the important rights at stake, and the critical need for informed decisionmaking recognized by the Legislature, we reverse the trial court’s decision in this case. Defendant is therefore entitled to judgment in her favor in the civil-suspension proceedings and we remand the civil matter for entry of such judgment. Granting the motion to suppress does not dispose of the two pending criminal charges against defendant, however, and the criminal case is thus remanded for additional proceedings

Reversed and remanded for additional proceedings

 

CARROLL, J., (Joined by Waples,J.) dissenting. Contrary to the majority’s holding, neither statute requires an officer to ask a suspect after the first test is administered if they would like to take a second test. The verb “elect” in § 1202(d)(5) gives the suspect the choice to take another test but puts no duty on the police officer to prompt the suspect to make that choice. See 23 V.S.A. § 1202(d) (“At the time a test is requested, the person shall be informed of the following statutory information.” (emphasis added)). Section 1203(c)’s “shall have the option of having a second infrared test administered immediately after receiving the results of the first test”  means that a law-enforcement officer must instead not intentionally deprive a suspect of the option at the appropriate time.

In sum, § 1202(d)(5) and § 1203(c) required that Officer Perkins advise defendant of her right to take a second test when Officer Perkins requested the first evidentiary test. There is no dispute Officer Perkins advised defendant of this right. But now, for the first time, the majority holds that appropriately disclosing the implied-consent warnings under the statute is not enough. Moreover, for the first time, the majority does not require a showing of bad faith or prejudice to suppress a breath test. Indeed, the majority no longer requires a defendant to even argue bad faith or prejudice to suppress a breath test. Instead, for the first time, suppression is mandatory if the officer deviates in the slightest way from reminding a defendant what was already disclosed to the defendant and to which the defendant already affirmatively acknowledged. I submit that this result goes beyond the relevant statutes, our precedents, the trial court’s credibility determinations, and defendant’s own arguments on appeal.

 I must respectfully dissent.

 

SCOVT affirms judgment as a matter of law for defendant driver in negligence case where there was no specific expert or other evidence of a causal link between driver’s alleged negligence and plaintiff jogger’s injury.

 Driscoll v. Wright Cut and Clean LLC, 2024 VT 49 [August 2, 2024]

 EATON, J. Plaintiff Frank Driscoll appeals a civil division order granting judgment as a matter of law on his negligence claim in favor of defendants Benjamin Wright and Wright Cut and Clean, LLC. Based on the evidence plaintiff presented at trial, defendants moved for judgment as a matter of law under Vermont Rule of Civil Procedure 50 at the close of plaintiff’s case. The court granted defendants’ motion. On appeal, plaintiff argues that the trial court erred in granting judgment as a matter of law. Because we determine plaintiff failed to produce sufficient evidence of causation, we conclude judgment as a matter of law was warranted. Accordingly, we affirm.

On July 18, 2019, plaintiff was running in a southerly direction on the left side of the road, facing into the flow of traffic. At the same time, defendant Benjamin Wright (driver), an employee of defendant Wright Cut and Clean, was driving a company truck also in a southerly but on the right side of the road. The truck was pulling a trailer.  As the truck approached plaintiff from behind, plaintiff looked behind him, and then moved about five feet to his left, toward the left edge of the road. As the truck passed plaintiff, driver looked in his side review mirror and saw plaintiff move get struck by the trailer. Plaintiff was unconscious when police arrived, and he has no memory of the accident.

The causation element of negligence requires sufficient evidence for a reasonable jury to conclude that, but for some negligent action by the defendant, the plaintiff would not have been harmed. Collins v.Thomas, 2007 VT 92, ¶ 8, 182 Vt. 250, 938 A.2d 1208. Evidence of injury alone is generally insufficient to show causation. Instead, the plaintiff must “rely on expert testimony” to demonstrate causation unless the circumstances are plain enough that “only common knowledge and experience are needed to comprehend it.” Sachs v. Downs Rachlin Martin PLLC, 2017 VT 100, ¶ 20, 206 Vt. 157, 179 A.3d 182 The absence of expert testimony or other viable evidence showing a causal link with the injury precludes a finding that the plaintiff sufficiently established that element. Bernasconi v. City of Barre, 2019 VT 6, ¶ 12, 209 Vt. 419, 206 A.3d 720; Lasek v. Vt. Vapor, Inc., 2014 VT 33, ¶ 15, 196 Vt. 243, 95 A.3d 447.

Plaintiff put on expert testimony at trial from a forensic engineer who opined that, at impact, “there wasn’t a four[-] foot safety gap or more between [plaintiff] and the trailer.”  The expert admitted, however, that there was “no physical evidence to establish where [plaintiff] was located” at any time before impact, and he was unable to provide conclusions on any causative factor leading up to the incident. The expert did not “know anything before [impact].” As such, he was unable to say whether there was in fact a “four[-]foot safety gap” between plaintiff and the trailer during the time leading up to impact or if the lack of such a gap, if any, was a causative factor in the collision. And he did not identify how, if at all, the truck’s speed or position or the driver’s alleged failure to better warn plaintiff provided any causal link between driver’s alleged negligence and plaintiff’s injury.

No other witness ever indicated what specific aspect of driver’s allegedly negligent actions caused plaintiff’s resulting harm. Because of plaintiff’s admitted inability to recall the incident, he could give no testimony on the subject. Absent specific evidence of causation, a jury would have to rely on mere speculation to determine what, if anything, was the causal link between driver’s actions prior to impact and plaintiff’s resulting injury. Absent the necessary evidence of causation, judgment as a matter of law must be affirmed. See Keegan v. Lemieux Sec. Servs., Inc., 2004 VT 97, ¶ 11, 177 Vt. 575, 861 A.2d 1135 (mem.) (recognizing that failure to prove any one element of negligence claim warrants judgment as matter of law).

Affirmed.

SCOVT affirms summary judgment in favor of defendant who pledged investment account as security, holding plaintiff did not have a valid security interest in account that was never subject to the control of the plaintiff as required by terms of the security agreement .

Berkshire Bank v.  Kelly, 2023 VT 2 

WAPLES, J. Plaintiff Berkshire Bank filed this action seeking possession of funds in an investment account owned by defendant Thomas Kelly, which defendant purportedly pledged as security for a business loan to his sister Dorothea Kelly. The civil division granted summary judgment in favor of defendant, concluding that plaintiff did not have a valid security interest in the account. We agree and affirm.

 

The trial court ruled a a security interest never attached under 9A V.S.A. § 9-203(b) and granted defendant's motion for summary judgment because plaintiff never possessed or controlled the Merrill Lynch account as required by the language of the pledge agreement.  

Article 9 provides that a creditor has a secured interest in collateral when the interest attaches, meaning "when it becomes enforceable against the debtor with respect to the collateral." 9A V.S.A. § 9-203(a). In turn, a security interest becomes enforceable against the debtor when one of four specified evidentiary conditions is satisfied. Id. § 9-203(b)

 

The parties agree that prior to the commencement of this litigation the Merrill Lynch account was never in plaintiff's possession or control, ruling out three of the methods of satisfying the evidentiary requirement. See 9A V.S.A. § 9-203(b)(3)(B)-(D) (providing for possession, delivery, or control pursuant to security agreement as alternative evidentiary tests of enforceability).

 

Accordingly, the security interest only attached if the evidentiary condition set forth in § 9-203(b)(3)(A) was met; that is, if defendant "authenticated a security agreement that provides a description of the collateral.".

Here, the agreement between the parties defined the collateral as "all of [defendant's] property . . . in the possession of, or subject to the control of, [plaintiff] . . . whether existing now or later and whether tangible or intangible in character, including" defendant's Merrill Lynch account.

On appeal, plaintiff argues that the security agreement describes  the collateral as the Merrill Lynch account, and that the  possession-or-control language is not a precondition to the creation of the security interest.

The language of the clause does not support plaintiff's interpretation, since it refers to the account already being in plaintiff's control. Under the plain meaning of this language, collateralization was dependent on transfer of possession or control of the Merrill Lynch account to plaintiff. Because that event never occurred, the security interest never attached.

 

 Plaintiff argues "a security agreement may create or provide for a security interest in after-acquired collateral." 9A V.S.A. § 9-204(a), and that the pledge agreement described the collateral as property within plaintiff's possession or control "whether existing now or later."  We are not persuaded by this argument. The account never met the description of the collateral because plaintiff never took control of it as the agreement contemplated. Section 9-204 applies to property in which the debtor does not have any rights at the time the security agreement is executed. The rule on after-acquired property does not assist plaintiff.

 

Finally, plaintiff argues that its security interest eventually did attach when defendant complied with the court's order directing him to set aside $208,000 "as security for the asserted debt in this matter" by placing that amount in escrow with his attorney, claiming that  plaintiff took possession of the collateral under 9A V.S.A. § 9-313(c)(1) at that point. We disagree. 

Section 9-313(c)(1) provides that a secured party takes possession of collateral held by a person other than the debtor when "the person in possession authenticates a record acknowledging that it holds possession of the collateral for the secured party's benefit." Id. cmt. 3. However, "a court may determine that a person in possession is so closely connected to or controlled by the debtor that the debtor has retained effective possession, even though the person may have agreed to take possession on behalf of the secured party." Id.

 

We conclude that such is the case here. We see nothing in the record indicating that defendant's counsel was acting as an agent of plaintiff. Under these circumstances, we conclude that plaintiff did not take possession of the collateral when the funds were placed in escrow by court order.

Because defendant's Merrill Lynch account was never within plaintiff's control, it did not fall within the description of collateral contained in the parties' pledge agreement, and no security interest ever attached to the account. The civil division therefore correctly granted summary judgment in favor of defendant.

 

Affirmed.  

SCOVT reverses suspension of driver’s license, holding blood -alcohol test inadmissible for lack of foundation showing compliance with performance standards in DPS rules.

State v.  White, 2023 VT 38 

COHEN, J. Defendant appeals from the civil division’s final judgment suspending his driver’s license. He argues that the trial court abused its discretion in admitting the results of an evidentiary blood-alcohol test because the State did not offer sufficient evidence to demonstrate that defendant’s blood sample was collected and analyzed in compliance with Department of Public Safety (DPS) rules. We conclude that there was an insufficient foundation to allow admission of the test result and therefore reverse and remand for entry of judgment for defendant.

The trial court overruled the defense objection, reasoning that the plain terms of 23 V.S.A. § 1203(d) do not require anything more than a “conclusory” statement of compliance with DPS rules.

To provide a proper foundation for admission of blood-test results, the State must show that the sample was analyzed by gas chromatography according to the performance standards established in the DPS rules. The State submitted no foundational evidence to demonstrate compliance with any of these performance standards.  It would serve no purpose to remand  because the record is devoid of foundational evidence regarding performance standards.

We emphasize the narrowness of our decision today. We are not deciding the level of detail necessary in the State’s foundational evidence for admitting blood-test results. The trial court may, or may not, be correct as a general matter that a conclusory statement of compliance with 23 V.S.A. § 1203(d) will suffice.

We need not reach that inquiry because the State did not meet the minimal burden to present an adequate foundation to admit the results of defendant’s blood-alcohol test into evidence.

The court erred by admitting and relying on that evidence. The State therefore could not prove an essential element, 23 V.S.A. § 1205(h)(1)(D), and the judgment in the State’s favor cannot stand.

Reversed and remanded for entry of judgment for defendant.

How cited

SCOVT reverses in part environmental division enforcement order based on clearly erroneous finding of knowledge of terms of prior owners agreement found to have been violated.

  

City of Burlington v. Sisters & Brothers Investment Group, LLP, 2023 VT 24

CARROLL, J. Defendant-landowner Sisters & Brothers Investment Group, LLP (SBIG) appeals an environmental-division enforcement order enjoining it from using real property in the City of Burlington, ordering it to address site-improvement deficiencies as required by an agreement executed by a prior owner and the City, and imposing $66,759.22 in fines. We reverse and remand.

 

The trial court “independently” concluded that SBIG had “failed to ever comply with a  2004 agreement,” and substantially relied on that finding in assessing a fine of $50 per day for a zoning violation.

 

SBIG’s arguments challenging the DRB decision fail under our long line of precedent forbidding collateral attacks on unappealed DRB orders.

 

SBIG next contends that the trial court abused its discretion by finding that SBIG was liable for 892 days of continuing violations, each subject to penalty. We disagree. We have held that municipalities “need not produce evidence of a continuing violation for each and every day.”

 

Finally, we agree with SBIG’s argument that t the $66,759.22 fine was an abuse of discretion because the court found that it knowingly breached the 2004 agreement without any evidence demonstrating that SBIG knew or should have known of the agreement’s existence. The mere fact of SBIG’s purchase one day following the agreement’s execution does not reasonably lead to the conclusion that it knew or should have known of its existence, even when viewed in the light most favorable to the City. More evidence was needed for the court to conclude SBIG was aware of and intentionally disregarded the agreement from the time it purchased the property for the purpose of calculating fines.

 

Because the trial court erroneously found that SBIG knew or should have known about the 2004 agreement, we reverse the judgment order, direct the trial court to strike the condition requiring SBIG to address the site-improvement deficiencies in the agreement, and remand for the court to recalculate fines without considering whether SBIG violated the agreement’s terms.

 

Considering this disposition, we need not address SBIG’s remaining arguments that the fine was punitive rather than remedial or that the 2004 agreement is moot.

 

Reversed and remanded to strike the condition requiring SBIG to address site-improvement deficiencies in the 2004 agreement and to recalculate fines without considering the 2004 agreement.

How cited