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Hixson v. American Towers, LLC

Court of Appeals of Tennessee, Knoxville

November 7, 2019

CARL WAYNE HIXSON ET AL.
v.
AMERICAN TOWERS, LLC

          Session August 20, 2019

          Appeal from the Chancery Court for Hamilton County No. 16-0804 Jeffrey M. Atherton, Chancellor

         Wayne Hixson and Eric Hixson (the Hixsons) granted a perpetual, exclusive easement to American Towers, LLC (ATC)[1] to operate a telecommunications system at the top of a hill on their property. For many years, the hill experienced progressive slope failures. A recent mudslide caused thousands of dollars in property damage to the Hixsons and All Things Fast Motorsports, LLC (All Things Fast), a metal fabrication business owned by Wayne Hixson's grandson. ATC spent thousands of dollars to move a generator away from the slope failure. The parties fear that the cell tower could collapse. In the trial court, the Hixsons and All Things Fast filed a complaint seeking a declaratory judgment regarding the parties' respective maintenance responsibilities under the easement agreement. They also sought damages arising from ATC's alleged breach of the easement agreement and other tortious conduct. ATC filed a counterclaim alleging similar causes of action. After a bench trial, the court ruled that ATC has a duty to maintain the easement and that the Hixsons have a duty to maintain the surrounding hillside for the benefit of ATC. Because the court found that the Hixsons and ATC were equally at fault for failing to prevent the recent mudslide, the court rejected their claims of negligence and breach of the easement agreement. However, the court awarded $1, 245.20 to All Things Fast on its negligence claim. The court also awarded $179.99 to the Hixsons on their trespass claim. Finally, the court ordered the Hixsons and ATC to pay half of the costs necessary to stabilize the hill in accordance with the remediation plan proposed by the Hixsons. ATC appeals. We modify the trial court's declaratory judgment, vacate the award of damages to All Things Fast, and remand for further proceedings. The judgment is affirmed in all other respects.

         Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Affirmed as Modified; Case Remanded

          Marc H. Harwell, Chattanooga, Tennessee, for the appellant, American Towers, LLC.

          Andrew F. Tucker, Dayton, Tennessee, for the appellees, Carl Wayne Hixson, Michael Eric Hixson, and All Things Fast Motorsports, LLC.

          Charles D. Susano, Jr., J., delivered the opinion of the court, in which Thomas R. Frierson, II, and Kenny W. Armstrong, JJ., joined.

          OPINION

          CHARLES D. SUSANO, JR., JUDGE

         I.

         Wayne Hixson and his son, Eric Hixson, are licensed general contractors. They reside in Hamilton County. In 1996, the Hixsons decided to get involved in ARCA racing.[2] They purchased real property in Soddy-Daisy and built a racecar shop. The racecar shop is situated at the foot of a large hill that runs along the eastern edge of the property.

         In February 1998, the Hixsons entered into a lease agreement with Chase Telecommunications, Inc. (Chase). The lease agreement gave Chase the exclusive right to use a portion of the hill on the Hixsons' property to "provid[e] communication services." A few months later, Specialty Constructors, Inc. (Specialty Constructors) constructed a cell tower and installed other related equipment on top of the hill.[3] An access road leading to the cell tower was also constructed. From the public highway, the access road is steeply uphill; then, after a dogleg to the left, the access road slopes downhill toward the cell tower for approximately 190 yards.

         For the purposes of this appeal, it is undisputed that the builder of the cell tower dug approximately thirty feet into the hill and left between six and nine feet of extracted fill dirt on top of the hill. Excess dirt from construction of the access road was also placed on top of the hill or thrown over the edge. Wayne Hixson claims that he expressed concerns about erosion and water runoff during the initial construction of the cell tower. In the end, nothing was done about the fill dirt. The builder leveled off the hill, constructed the cell tower, and installed other related equipment. Sometime between 1998 and 2000, ATC took over this telecommunications system by sub-lease from Chase or from one of its successors-in-interest.

         Eric Hixson testified that, in late 1999 or early 2000, part of the hill "broke off" and slid toward the racecar shop. He testified that "another mudslide" occurred in 2001. According to Wayne Hixson, "every time there was a big rain," the Hixsons would "have mud coming down through there on the rest of [their] property[.]" According to the Hixsons, water flows down the access road toward the cell tower and causes erosion of the hill. Wayne Hixson claims that he called ATC numerous times asking for their help, but he did not submit those requests in writing. According to the Hixsons, ATC was not responsive.

         In 2003, the Hixsons attempted to take remedial action. They began constructing an RV garage directly below the cell tower, where the worst mudslides were occurring. They designed the rear wall of the RV garage to serve as a retaining wall. The Hixsons also installed a French drain around the perimeter of the RV garage to divert water runoff. The first four bays of the RV garage were completed in 2004.

         Despite these efforts, the mud kept coming. In 2007, the Hixsons constructed another four bays adjacent to the existing RV garage. The Hixsons testified that they used a "skid steer Bobcat" to remove about four feet of dirt from the area in order to build the second part of the garage. The Hixsons insisted that they only excavated loose dirt that had eroded down the hillside and that they did not dig into the toe of the hill, which, they said, was marked by several large boulders. Over the next few years, mud continued sliding down the hill and piling up behind the RV garage.

         In July 2010, the Hixsons and ATC executed an easement acquisition agreement. In that agreement, ATC promised to pay the Hixsons $496, 500 in exchange for two easements: (1) a "perpetual, exclusive easement" to use the land beneath and around the cell tower; and (2) an "access and utility easement" to use the road leading to the cell tower. The Hixsons also promised to assign ATC all of their rights and obligations as landlords under the 1998 lease agreement. After closing, the parties recorded an easement agreement in the Register's Office of Hamilton County. The easement agreement sets forth the parties' rights and responsibilities in greater detail.

         In 2013, ATC received complaints from its customers about ruts in the access road. In response, ATC construction manager Dale Melton sent ATC field operations technician Curtis Utz to inspect the property. Mr. Utz testified that he had inspected the property once per year since 2004 and had taken about fifty photographs of the cell tower and access road. Mr. Melton also hired a third-party company to inspect the property. According to Mr. Melton, the third-party company notified him in May 2014 that the hill appeared to be failing. ATC claims this was its first notice of the hill failure, despite the Hixsons' claims to the contrary and despite the fact that Mr. Utz had conducted annual inspections of the property for about a decade.

         ATC retained GEOServices, LLC (GEOServices) to perform a geotechnical exploration "to characterize the subsurface conditions for the existing slope[.]" On August 5, 2014, GEOServices published a report of its findings and recommendations. The report confirmed that the hill was failing. It recommended the use of soil nails to stabilize the hill. Shortly thereafter, ATC asked GEOServices to provide a design for a soil nail remediation plan that ATC could send to potential contractors. On August 27, 2014, GEOServices published a report of its soil nail remediation plan.

         In December 2015, Soddy-Daisy experienced an extraordinary amount of rainfall. According to Wayne Hixson, it rained "four or five days in a row" leading up to Christmas. He testified that "the total rainfall was about seven inches" and that it rained "about two inches" on Christmas eve. On Christmas day, the Hixsons discovered that there had been another mudslide. This time, a tree and "about two loads of chert" crashed through the roof of the RV garage. This damaged the RV garage and equipment owned by the Hixsons and All Things Fast. As a precaution, ATC spent about $25, 000 to move a generator away from the slope failure. ATC also placed a tarp over part of the slope.

         In 2016, ATC finally got around to repairing the access road. Patrick Barry, ATC's Director of Architectural Engineering, supervised this project. Mr. Barry testified that ATC graded the access road using crusher run, which is designed to withstand erosion. Mr. Barry also testified that ATC dug a ditch along the eastern side of the road and "pitched" the road from west to east so that water would run into the ditch. Finally, ATC constructed a "level spreader" at the end of the access road near the cell tower. The level spreader was designed to collect water from the ditch and discharge it to the east of the Hixsons' property. Dr. James Smoot, a hydrologist, testified that ATC's 2016 improvements were properly designed to direct water away from the Hixsons' property.

         On December 7, 2016, the Hixsons and All Things Fast filed their complaint. They sought: a declaratory judgment regarding the parties' maintenance responsibilities under the easement agreement; $40, 000 in damages arising from ATC's alleged breach of the easement agreement and other tortious conduct[4]; punitive damages; "[a] yet undetermined sum to correct the erosion and water runoff issues"; attorney's fees and costs; and "[a]ll other general relief deemed just and proper[.]"

         In its "Answer and Verified Counterclaim," ATC denied responsibility for the hill failure and asserted a variety of defenses, including: failure to state a claim upon which relief can be granted; comparative fault; and "all applicable statute[s] of limitations and statutes of repose[.]" ATC also sought: an unspecified amount of damages arising from the counter-defendants' alleged negligence and breach of the easement agreement; "an Order compelling the [Hixsons] to take immediate measures and corrective action to provide stabilization to the slope/hillside"; attorney's fees and costs; and "all other general relief deemed just and proper[.]"

         In May 2017, the court held a hearing on ATC's request for injunctive relief. The court heard testimony from several witnesses and received twenty-one exhibits into evidence. Ultimately, the court denied ATC's request for injunctive relief and ordered the parties to attend mediation. When mediation was unsuccessful, both parties filed motions for summary judgment. The court denied both motions and set the case for trial.

         A three-day trial took place from January 30, 2018 to February 1, 2018. The court heard testimony from ten witnesses, including the Hixsons, ATC representatives, and multiple expert witnesses. Pursuant to Tenn. R. Civ. P. 65.04(7), the court also considered the testimony and exhibits entered into evidence during the May 2017 hearing. The court set forth its findings of fact and conclusions of law in a twenty-page memorandum opinion and order filed on August 6, 2018.

         The court "found the testimony of Wayne Hixson to be generally credible, though not always in the Hixsons' favor." On the other hand, the court found the testimony of Dale Melton and Patrick Berry to be "somewhat unpersuasive." For example, the court disbelieved Mr. Melton's testimony that ATC first received notice of the hill failure in May 2014. Instead, the court found that Curtis Utz, who conducted annual inspections of the property, "had almost as much of an opportunity as the Hixsons to observe the open and obvious erosion taking place on the hillside."

         The court also made factual findings regarding the cause of the hill failure:

[T]he original construction of the tower and tower pad in close proximity to the edge of the hill likely caused and contributed to the erosion. The proof at trial showed that, during the construction of the tower and tower pad, the builder dug down approximately thirty feet and left the extracted fill dirt on top of the hill, much of which was within the Easement area. This was specifically supported by the testimony of Mr. Hodnett, stating that the failure of [the] hill occurred at the top, rather than at the toe. That fill dirt has caused an excess of earth moving down the hill over the years since construction.

         Although the court found that the original construction of the cell tower led to the instability of the hill, the court ruled that the Hixsons and ATC were equally at fault for failing to properly maintain their respective areas of the property. For example, the court found that ATC failed "to secure the dirt next to the concrete pad and within the Easement" and failed "to control water on the tower pad from running down the hillside above the RV Garage[.]"[5] On the other hand, the court found that the Hixsons failed to cover the bare hillside or promote the growth of vegetation on the hill, which, according to Dr. Smoot, would have prevented erosion. To their credit, however, the court found that the Hixsons did not cut into the toe of the hill during the construction of the RV garage.

         The court ruled that most of the parties' claims were without merit. Relevant to this appeal, the court awarded $1, 245.20 to All Things Fast on its negligence claim. The court also awarded nominal damages to the Hixsons after finding that ATC trespassed on their property during ATC's 2016 improvements to the access road. The court rejected ATC's claim against the Hixsons for breach of the easement agreement. The court also ruled that the doctrine of comparative fault barred ATC from recovering on its negligence claim against the Hixsons. Finally, the court rejected ATC's claims against All Things Fast because All Things Fast was not a party to the easement agreement and did not owe ATC a duty of care.[6]

         In December 2018, the court held a third hearing on the issue of remediation. Jimmy Mason, a general contractor, testified on behalf of the Hixsons. He recommended the construction of a larger retaining wall at the bottom of the hill, which he estimated would cost $332, 480. Mr. Mason's remediation plan had not been approved by a professional engineer at the time of the hearing. Derek Kilday, the Vice-President and Senior Geotechnical Engineer at GEOServices, testified on behalf of ATC. Mr. Kilday recommended the installation of soil nails at the top of the hill, which he estimated would cost $615, 000. Mr. Kilday believed that the installation of soil nails would be much safer for the construction workers. However, he admitted that his remediation plan would not involve removal of the dirt that has piled up behind the RV garage. At the conclusion of the hearing, the court stated the following:

Although less sophisticated, the testimony provided by Mr. Mason provides a more comprehensive approach to the retention of the hillside. I heard Mr. Kilday testify, and I even followed it up, [his] primary concern with regard to the poured wall approach dealt with the safety of the workers, not with the efficacy of the structure.
Under the circumstances, based upon the proof presented to me, and we're looking for a long term comprehensive fix, rather than the somewhat more narrow approach that the soil nails would provide, the testimony provided to the Court persuades this Court that the poured wall approach presented and suggested by Mr. Mason at the cost of $332, 480 is the most appropriate mechanism to effect the security of this hillside.[7]

         The court ordered the Hixsons and ATC to pay half of the costs necessary to stabilize the hill in accordance with the remediation plan proposed by the Hixsons. ATC appealed. Later, upon motion of the parties, the court entered an agreed order staying enforcement of its judgment pending the resolution of this appeal.

         II.

         Although not stated as such, ATC raises the following issues:

Whether the Hixsons' claims are barred by the three-year statute of limitations set forth in Tenn. Code Ann. § 28-3-105.
Whether the trial court erred by declaring that ATC has a duty under the easement agreement to maintain the easement on top of the hill.
Whether the trial court erred by rejecting ATC's claim against the Hixsons for breach of the easement agreement.
Whether the trial court erred by rejecting ATC's negligence claim against the Hixsons.
Whether the trial court erred by awarding $1, 245.20 to All Things Fast on its negligence claim.
Whether the trial court erred by ordering the parties to repair the hill in accordance with the Hixsons' remediation plan.
Whether the trial court erred by ordering ATC to pay half of the costs necessary to implement ...

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