YOUR OLD SHED IS ON YOUR NEIGHBOR'S PROPERTY - WHAT HAPPENS?

The Colorado Court of Appeals recently ruled on a case involving the rights of neighboring land owners with respect to a metal shed used and maintained by one neighbor ("Shed Owner") on the land of the other neighbor ("Land Owner") for many years. Hunter v. Mansell, 09CA0799 (Colo. Ct. App., March 4, 2010).

The shed in question was constructed in 1974 by Shed Owner's predecessor in title. Shed Owner purchased the property in 2001, and at the time of purchase, was informed by the seller that the shed encroached on Land Owner's property. In 2006, Land Owner filed a trespass action against Shed Owner seeking removal of the shed. Shed Owner countered with a claim alleging she was the owner of the land on which the shed was located by adverse possession.

On the adverse possession claim, the trial court ruled that Shed Owner did not own the shed site because Shed Owner's predecessor disclosed to Shed Owner that the shed encroached on Land Owner's property, and, therefore, Shed Owner could not "tack" the previous owner's adverse possession period for purposes of the 18-year period prescribed by statute.

Under Colorado law, a person who has been in exclusive and uninterrupted possession of another person's real property for at least 18 years and the possession has been actual, adverse, hostile, and under a claim of right, such person becomes the owner of such property by adverse possession. C.R.S. sec. 38-41-101. For purposes of calculating the 18-year period, a current owner may add or "tack" continuous adverse possession by prior owners.

The trial court held that the disclosure of the encroachment constituted a disclaimer of any "claim of right" to the disputed strip of property on which the shed stood. The Court of Appeals rejected this analysis because the 18-year statutory period had already expired when the "disclaimer" took place. It stated that "[u]pon expiration of the statutory period, ownership vests in the person adversely possessing and it can be transferred only by deed, not by a disclaimer." Hunter, supra, at 12. Notwithstanding, the Court of Appeals upheld the trial court's dismissal of Shed Owner's adverse posession claim because possession of the property was not "hostile" for the statutory period. The Court found that Shed Owner's possession of the disputed strip was initially permissive, and therefore not hostile, because the evidence showed that Shed Owner's predecessor entered into a lease of the disputed strip within the first 18 years after the shed was constructed, thereby terminating any adverse possession.

Regarding Land Owner's trespass claim, the trial court's remedy was to give the Shed Owner the choice of leasing the disputed property indefinitely for one dollar per month or purchasing the disputed property for an appraised value. The Court of Appeals reverse the trial court's remedies and remanded for entry of a mandatory injunction requiring the removal of the shed from Land Owner's property. Although not necessary to its ruling, the Court rejected the notation that a court could award a trespasser the right to purchase property from the owner of that property.

The general rule is that removal is the appropriate remedy for trespass of this type. However, exceptions have been made where the encroachment is slight or harmless (e.g. a commercial building encroaching by a couple of inches) and/or the expense of removal greatly outweighs the damage suffered by the plaintiff (e.g. removing two inches from a commercial building compared to the value to plaintiff of those two inches of land). See Golden Press v. Rylands, 235 P.2d 592 (1951). In such cases, the court may fashion other appropriate awards (e.g. damages related to the value of the lost property).

In Hunter, the Court of Appeals held that removal of the shed was not sufficiently costly to warrant breaking from the general rule favoring an injunction for mandatory removal, particularly where the majority of the costs cited by Shed Owner were related to improves to the shed incurred after Shed Owner acquired the property with knowledge of the encroachment.

Posted By: Brent W. Houston, Esq.