[00:00:02] Speaker 03:
United States Court of Appeals for the Ninth Circuit is now in session.

[00:00:09] Speaker 04:
Good morning and welcome counsel.

[00:00:13] Speaker 04:
Before we hear our first argued case, our panel wants to submit the following case of Leach versus Bessignano.

[00:00:22] Speaker 04:
That case is now submitted on the briefs and we will hear our first argued case, which is the case of Hugh Sutherland et al.

[00:00:30] Speaker 04:
versus Paul Waterford.

[00:00:33] Speaker 04:
I believe that Mr. Kotadek is first up representing the appellants.

[00:00:41] Speaker 04:
Mr. Kotadek, please proceed.

[00:00:44] Speaker 00:
Good morning, Your Honor, and may it please the Court, Jesse Kadadek on behalf of the Southerlands.

[00:00:48] Speaker 00:
The modern understanding of property ownership is often framed as a bundle of rights or a bundle of sticks, and easement is one of those sticks.

[00:00:57] Speaker 00:
So I would like to start with the timing issue identified by the District Court as it relates to the mine road easement and as it applies to the relation back doctrine.

[00:01:06] Speaker 00:
In April of 2002, Sagebrush entered into a contract for deed with Reber Knight, where Reber Knight agreed that if they satisfy the terms of the contract, a deed will be delivered in the future.

[00:01:20] Speaker 00:
They record a notice of purchaser's interest or an NPI.

[00:01:24] Speaker 00:
At that point, equitable title is vested in Reber Knight, but Sagebrush retains legal title, including to the Mine Road easement stick.

[00:01:33] Speaker 00:
A few months later, Sage Rush conveyed the property with the Mine Road easement to the Holtz without reserving an easement, which we'll get to later.

[00:01:42] Speaker 04:
Let me just stop you right there, if I may counsel.

[00:01:46] Speaker 04:
If I understand correctly, Sage Rush recorded three different certificates of survey that showed an easement on Mine Road, which starts with the Sutherland's property, cuts through the Waterford's property, and continues on to property held by non-parties.

[00:02:02] Speaker 04:
These three certificates of survey were recorded September 4, 2001, May 28, 2002, and July 2, 2002.

[00:02:14] Speaker 04:
It's my further understanding that the legal interest, not the equitable interest in the property, was subsequently conveyed by a number of warranty deeds.

[00:02:27] Speaker 04:
And as you well know,

[00:02:30] Speaker 04:
Warranty deeds have a specific meaning in Montana.

[00:02:37] Speaker 04:
Specifically, warranty deed under Title 70 Chapter 21 is the strongest possible deed that can be given.

[00:02:45] Speaker 04:
It includes a precise legal description of the property.

[00:02:49] Speaker 04:
It conveys and warrants the right to convey a good and marketable title.

[00:02:54] Speaker 04:
the buyer's ownership will be disturbed by superior claims and a warranty to defend.

[00:03:03] Speaker 04:
Am I correct so far?

[00:03:05] Speaker 00:
You're correct so far, but the order of the warranty deeds is very important.

[00:03:10] Speaker 00:
And the recording statutes and the way notice works in Montana, we believe controls the outcome of this case.

[00:03:17] Speaker 04:
But those warranty deeds were recorded, right?

[00:03:20] Speaker 00:
The problem is that the sagebrush to reaper night warranty deed was not recorded until after sagebrush had sold what's now Sutherland's parcel to the Holtz without reserving an easement.

[00:03:33] Speaker 00:
And under Montana's race notice recording system, a purchaser like the Holtz have priority over earlier purchasers if the Holtz lack notice of the earlier conveyance and if they record their conveyance first.

[00:03:47] Speaker 00:
Here, there was no notice for the Holtz

[00:03:50] Speaker 00:
to take notice of because the Montana Supreme Court held unequivocally in Towsley that a recorded NPI is not a conveyance that creates a legal property, right?

[00:04:02] Speaker 02:
The recordance was when, 2007, is that correct?

[00:04:06] Speaker 00:
Yes, but the NPI was recorded in April of 2002.

[00:04:09] Speaker 00:
Then Sagebrush, which was the common owner of all these properties, sold what is now the Sutherland's property to the Holtz also in 2002, a few months later, in October of 2002.

[00:04:21] Speaker 00:
It wasn't until five years later that the Sagebrush to Reaver Knight warranty deed was recorded.

[00:04:27] Speaker 00:
And it's our position that any deeds that were recorded later couldn't create a property interest in the Mine Road easement because Sage Rush, when it deeded the property to the Holtz, did not withhold that property right in the conveyance to the Holtz.

[00:04:48] Speaker 00:
And so the Holtz... And this gets to your issue about the escrow, right?

[00:04:52] Speaker 00:
You know, you know, it does get to the issue about the escrow and the relation back doctrine.

[00:04:57] Speaker 00:
First of all, the district court and water worth treated as a

[00:05:03] Speaker 00:
general rule, but it's not, it's the exception and not the rule.

[00:05:07] Speaker 00:
And the California courts and the Montana courts have noted that it only applies when the intervening rights of third parties have not gotten in the way of the relation back doctrine.

[00:05:22] Speaker 04:
Let me, if I may challenge that, if I will, if I may, I found some

[00:05:29] Speaker 04:
Montana Supreme Court cases that seem to deal with the escrow question, specifically Blackmer versus Blackmer, which is 525 P.

[00:05:39] Speaker 04:
2nd, 559.

[00:05:42] Speaker 04:
That's 1974.

[00:05:44] Speaker 04:
Another one really close, Carahan versus Gupton, 96 P.

[00:05:50] Speaker 04:
2nd, 513, Montana, 1939.

[00:05:56] Speaker 04:
And Playmall versus Keene.

[00:05:59] Speaker 04:
which is 247 P57 P54 556 Montana 1929, which seems to suggest that placing the deed in escrow is a constructive notice.

[00:06:17] Speaker 04:
Now, you can look up those cases.

[00:06:19] Speaker 04:
Nobody cited them.

[00:06:21] Speaker 04:
We found them.

[00:06:22] Speaker 04:
But it seems to me that those cases make it pretty clear that by placing the deed in escrow, it was sufficient.

[00:06:33] Speaker 04:
There was constructive notice.

[00:06:34] Speaker 04:
And I didn't ask you this, but did your client or any client in the chain of title in the legal

[00:06:42] Speaker 04:
but not the equitable portion of the land, get either a CLTA policy of title insurance or an ALTA extended coverage policy of title insurance?

[00:06:53] Speaker 04:
Does the record show that?

[00:06:54] Speaker 00:
It's not in the record, Your Honor.

[00:06:56] Speaker 00:
There's some discussion in the record about some of these certificates of survey were referenced in the Sutherland title commitment, but the notice of purchase interest and the warranty deed to Reber Knight were not.

[00:07:07] Speaker 00:
I don't think that's relevant.

[00:07:09] Speaker 00:
A title insurance policy does not create a substantive right in anyone's name.

[00:07:12] Speaker 04:
But it puts the parties on notice.

[00:07:15] Speaker 04:
I'm astounded, frankly, that in this, if you will, wild country, where you have these unusual frames of a lot of property, that there wouldn't be title insurance involved.

[00:07:29] Speaker 04:
And if you're telling me that there was title insurance involved somewhere along the way,

[00:07:33] Speaker 04:
particularly with the warranty deed aspect of it, that would provide notice of the easement because Exhibit A, everybody seems to agree, shows where the easement runs down Mine Road.

[00:07:50] Speaker 04:
Everybody had notice of that.

[00:07:53] Speaker 00:
So here's the problem, Your Honor.

[00:07:55] Speaker 00:
In Towsley forecloses that conclusion, we believe, because Towsley held in 2022, in a case that had an NPI identical to the one here, it said an NPI is not a conveyance of property, it's only notice of potential future conveyance, so it doesn't presently create an easement.

[00:08:13] Speaker 00:
And this is important in the context of a contract for deed, because under Montana law,

[00:08:18] Speaker 00:
A vendor under contract for deed here Sagebrush does not need to have the title that it promises to convey in the future at the conclusion of the contract.

[00:08:29] Speaker 04:
Even though it gives a warranty deed and that warranty deed is placed in escrow.

[00:08:35] Speaker 00:
the purpose of the warranty deed as between those parties, when this vendor under a contract for deed is unable to deliver the promised title at the conclusion of the contract, when the purchase price is fully paid, that is the buyer, in this case, Reber Knight, now has a remedy in contract because the seller breached its promises under the contract for deed.

[00:09:00] Speaker 00:
And so also breached the promises in the warranty deed.

[00:09:03] Speaker 04:
Are you saying that in the first conveyance, where the warranty deed was placed in escrow, that that seller did not have title to the land over which the easement flowed?

[00:09:17] Speaker 04:
Is that right?

[00:09:18] Speaker 00:
No, I'm sorry.

[00:09:19] Speaker 00:
I hope I'm not misunderstanding your question, Your Honor, but when the warranty deed was placed in escrow, there was no conveyance.

[00:09:25] Speaker 00:
The conveyance doesn't occur.

[00:09:27] Speaker 04:
There was that exhibit A, which showed the easement.

[00:09:31] Speaker 00:
This is literally the exact same notice of purchaser's interest with reference to an easement occurred in Towsley.

[00:09:37] Speaker 00:
And the holding of Towsley is that that is insufficient to create an easement.

[00:09:41] Speaker 00:
Now it is true.

[00:09:43] Speaker 04:
How can that be, sir?

[00:09:45] Speaker 04:
I mean, you have an explicit description of an easement and it's in each one and it's described as such and it runs from the top runs all the way down through partial one.

[00:09:58] Speaker 04:
and ultimately gets down to the lower road.

[00:10:01] Speaker 04:
It's described as an easement.

[00:10:03] Speaker 00:
The other one.

[00:10:04] Speaker 00:
The NPI, it's literally the exact same, an NPI is a creature of statute in Montana, right?

[00:10:10] Speaker 00:
And Towsley looked at it and said, even if the exhibit attached, the legal description, so here exhibit A to the NPI contains language of conveyance, appears to contain language of conveyance, that doesn't mean that NPI is actually conveying that.

[00:10:24] Speaker 00:
It's a promise to convey it in the future.

[00:10:27] Speaker 00:
But if the vendor is unable to convey that in the future, that is not the problem of the Holtz.

[00:10:35] Speaker 00:
Here's the problem.

[00:10:35] Speaker 00:
The Holtz took under Towsley, the Holtz bought their property, which is now the Southerlands.

[00:10:40] Speaker 00:
It wasn't until five years later.

[00:10:43] Speaker 00:
that the Reber night warranty deed was recorded.

[00:10:46] Speaker 00:
I don't think the relation back doctrine stands through the rule that an intervening right of a third party like the holds, they can buy a property, have it for five years, and then five years later, by virtue of an event uncertain to occur, which is the fulfillment of the contract for deed payments, that they now come in and have that stick, the right to exclude, involuntarily taken away from them.

[00:11:12] Speaker 04:
What would happen if on the first deed, the warranty deed was placed in escrow, and let's say that a month later the payment was made, there would be no problem here, right?

[00:11:24] Speaker 04:
The relation back would occur.

[00:11:27] Speaker 00:
It's a question of timing of the recording.

[00:11:31] Speaker 04:
But if the conditions precedent to satisfy the equitable contract here had occurred within a one-month

[00:11:41] Speaker 04:
of placing the warranty deed in escrow, we wouldn't even be talking about this, right?

[00:11:46] Speaker 00:
I don't think that's correct, Your Honor.

[00:11:48] Speaker 00:
Under the Montana Supreme Court case Earl versus Pavex and the statute 70-21-304, which are cited on page 12 of our reply, the Montana Supreme Court makes clear that a purchaser like the Holt have priority if they record their deed first and they lack notice of an earlier conveyance.

[00:12:08] Speaker 00:
Here in Towsley, the Montana Supreme Court said the NPI is not the conveyance.

[00:12:14] Speaker 00:
The conveyance would happen by

[00:12:16] Speaker 00:
future delivery of the warranty deed.

[00:12:18] Speaker 00:
It's stipulated here that the warranty deed wasn't released from escrow and recorded until 2007, by which point Sagebrush did not have the ability to convey an easement because they had sold the property to the Holtz.

[00:12:32] Speaker 04:
It gets down then to whether they had notice.

[00:12:35] Speaker 00:
It, it, there was, it gets down to whether they had notice of a conveyance.

[00:12:39] Speaker 00:
But the problem is, is the Montana Supreme Court again and tells me sent an API not a conveyance.

[00:12:44] Speaker 00:
If Towsley hadn't happened.

[00:12:46] Speaker 00:
And 2022 in a published opinion by the Montana Supreme Court.

[00:12:50] Speaker 00:
be here making this argument.

[00:12:51] Speaker 00:
But Towsley, along with Earl versus Pavex and the Montana recording statutes, compel the outcome that at the time Sagebrush sold the property to Holtz in 2002, just a few months after the NPI was recorded,

[00:13:06] Speaker 00:
Sage Rush parted with the ability to grant an easement in the future.

[00:13:10] Speaker 00:
And let me just give you an example of this, Your Honor.

[00:13:12] Speaker 00:
I could sell to you, for example, my house in town here in Montana, and in the warranty deed, I could purport to grant you an easement over my neighbor's property, even if we border a county road or something.

[00:13:24] Speaker 00:
The clerk and recorder is gonna take that warranty deed, they'll record it.

[00:13:28] Speaker 00:
They're not gonna check it for legal sufficiency of an easement.

[00:13:31] Speaker 00:
But just because the warranty deed says I'm granting you an easement over some property I don't own doesn't mean the easement is created.

[00:13:38] Speaker 00:
It's ineffectual, it's a nullity.

[00:13:42] Speaker 00:
And that is ultimately what the holding in Towsley compels in this case.

[00:13:50] Speaker 00:
And so you'd have to look to see if Sagebrush to hold conveyance created an easement, and it did not.

[00:13:57] Speaker 04:
Okay.

[00:13:57] Speaker 04:
Do you want to save any of your time?

[00:13:58] Speaker 04:
It's entirely up to you.

[00:14:00] Speaker 00:
I would like to save any time for rebuttal.

[00:14:01] Speaker 00:
Thank you.

[00:14:02] Speaker 04:
Very well.

[00:14:03] Speaker 04:
All right.

[00:14:04] Speaker 04:
Mr. Cockrell, please.

[00:14:07] Speaker 01:
Yes, sir.

[00:14:07] Speaker 01:
Thank you.

[00:14:09] Speaker 01:
Let me start off with the issue that you raised, Your Honor.

[00:14:13] Speaker 01:
There were three certificates of survey recorded.

[00:14:16] Speaker 01:
The first one, as you know, it was September 4th, 2001.

[00:14:20] Speaker 01:
And on that certificate of survey, all of what is now the Sutherland's property was identified as either track one or track two.

[00:14:28] Speaker 01:
And at that point in time, the mine road easement, we all call it, was identified on there.

[00:14:35] Speaker 01:
And the location of mine road easement never changed on that certificate of survey.

[00:14:40] Speaker 01:
The second certificate of survey recorded May 28, 2002.

[00:14:44] Speaker 01:
or the third recorded July 2nd, 2002, which was prior to the conveyance from Sagebrush to Holtz.

[00:14:53] Speaker 04:
Council, what do we do with- I'm sorry, go ahead, go ahead.

[00:14:56] Speaker 03:
Oh, sorry.

[00:14:58] Speaker 03:
I wanted to know, what do we do with the escrow statute 70-1-511?

[00:15:02] Speaker 03:
That seems to squarely govern the situation.

[00:15:08] Speaker 03:
And if we just apply that statute, then really,

[00:15:13] Speaker 03:
it's not effective until all the conditions are performed and until delivery of the poster is made, which didn't occur until 2007.

[00:15:21] Speaker 01:
70-1-511 provides that delivery takes, or the document takes effect upon delivery to a third party.

[00:15:31] Speaker 01:
70-1-512 subsection two, which the district court noted, provides that delivery may be constructive and constructive delivery to a third party

[00:15:43] Speaker 01:
applies in that situation.

[00:15:45] Speaker 01:
When it is delivered to the stranger, that is the escrow.

[00:15:48] Speaker 01:
Therefore, when this warranty deed was delivered to the escrow agent, April 2002, and therefore because constructive delivery occurred that day, delivery was effective that day.

[00:16:02] Speaker 03:
My question is why resort to the constructive delivery

[00:16:05] Speaker 03:
statute, when under the Estuary Coast statute, if I understand that correctly, title doesn't transfer until the conditions are met.

[00:16:14] Speaker 03:
Is there a conflict between the statutes there and one seems to dictate one outcome and then the other dictates a contrary outcome?

[00:16:22] Speaker 03:
What are we dealing with here?

[00:16:23] Speaker 01:
We're dealing with both legal title and equitable title, which Mr. Khodadak raised at the beginning.

[00:16:29] Speaker 01:
Equitable title and legal title, they separated on the date the contract was signed.

[00:16:35] Speaker 01:
What you're dealing with there, I believe under 70-1-511 is legal title.

[00:16:41] Speaker 01:
And that's why Montana applied the relation debt back doctrine.

[00:16:46] Speaker 01:
Otherwise you pay off a contract for deed five years, 10 years, 20 years in the future,

[00:16:53] Speaker 01:
If the seller that sold you the property under the contract for deed no longer owns the property upon which it gave an easement, you end up with a, I guess for lack of better words, a pig in a poke.

[00:17:05] Speaker 01:
You did not get what you paid for.

[00:17:07] Speaker 03:
So if I understand your answer correctly, under the escrow statute, legal title doesn't transfer into 2007.

[00:17:13] Speaker 03:
So you're relying on relation back doctrine back to 2002.

[00:17:17] Speaker 03:
Correct.

[00:17:19] Speaker 03:
And does relation-back doctrine require exceptional circumstances?

[00:17:23] Speaker 03:
And if so, what are the circumstances here that would trigger the application of relation-back?

[00:17:28] Speaker 01:
The exceptional circumstances is Waterworth would have no easement over mine road via the contract for deed, which is in their chain of title, via the warranty deed, which is in their chain of title.

[00:17:42] Speaker 01:
They'd have no easement over mine road, short of

[00:17:48] Speaker 01:
either the easement by reference doctrine, which we don't need to get to, or looking at the recorded certificates of survey.

[00:17:56] Speaker 01:
And as you know from the cases both parties cited, the recorded certificate of survey can create an easement.

[00:18:02] Speaker 01:
And here the entire easement was shown on the 2001 certificate of survey 484308.

[00:18:09] Speaker 01:
It has been there prior to Sagebrush ever selling to

[00:18:15] Speaker 01:
Holt or sagebrush ever selling to.

[00:18:18] Speaker 03:
Oh, I just want to make sure that I understand your answer.

[00:18:21] Speaker 03:
So the exceptional circumstances here relates to the fact that there's notice and the parties could see from exhibit A exactly where the easement ran.

[00:18:31] Speaker 01:
Yes, they can.

[00:18:32] Speaker 01:
Absolutely.

[00:18:33] Speaker 01:
And that and exhibit A to both the NPI and the warranty deed describes where it starts.

[00:18:39] Speaker 01:
They actually use the word.

[00:18:40] Speaker 01:
It begins from eight mile road.

[00:18:43] Speaker 01:
describe where it goes through, through the now Sutherland property, they give it by legal.

[00:18:48] Speaker 03:
Those are sort of like equitable principles.

[00:18:50] Speaker 03:
What's your best case for applying the exceptional circumstances?

[00:18:54] Speaker 01:
Luxby Miller, the California case.

[00:18:59] Speaker 01:
And as well as Calvin versus Custer County, which we cite in our brief, as well as the other Blumenthal case and the US Supreme Court decision that we cite in our brief.

[00:19:13] Speaker 01:
but Luxby Miller would be the best one, which is the one the district court noted in this case.

[00:19:21] Speaker 03:
Thank you, counsel.

[00:19:22] Speaker 04:
I'd be interested in your response to, I had cited three different Montana Supreme Court cases, which none of the parties cited here, but in Carnahan versus Gupton in a 1939 case, the Montana Supreme Court reviewed another predecessor to 70-1-511

[00:19:41] Speaker 04:
with identical language to what the California case had.

[00:19:45] Speaker 04:
The court explained that, and I'm quoting, though there must be delivery of a deed in order to best title, delivery may be made by placing the deed in escrow pursuant to what is now section 70-1-511.

[00:19:57] Speaker 04:
The court went on to state that, in quotes, actual manual delivery is not essential and constructive delivery is sufficient pursuant to the predecessor of 70-1-512,

[00:20:10] Speaker 04:
which has language identical to the present day condition.

[00:20:14] Speaker 04:
So from my perspective, the Montana Supreme Court has decided the issue that we're dealing with here in terms of the escrow.

[00:20:23] Speaker 04:
We don't even need to, I know the district court talked about a California statute that was substantially identical, but we have a Montana Supreme Court that seems to govern this issue, right?

[00:20:34] Speaker 04:
Assuming that what I read is accurate, isn't that correct?

[00:20:37] Speaker 01:
Assuming what you read is accurate, that is correct, your honor.

[00:20:41] Speaker 01:
I pulled up the case while you were discussing it, and I agree with the way you read that case.

[00:20:47] Speaker 01:
You do not need actual delivery, which is why we have 70-1-512 subsection two, which the district court noted.

[00:20:56] Speaker 01:
So you would not have to get to the relation back doctrine based upon your reading of that case.

[00:21:01] Speaker 01:
But alternatively,

[00:21:04] Speaker 01:
the relation back doctrine does apply.

[00:21:05] Speaker 04:
And for the reason I explained concerning the exceptional circumstance, the distinct- And I gather from your perspective that the issues that are primarily troubling here deal with the equitable portion of this.

[00:21:21] Speaker 04:
But from your perspective, the legal elements of this, the title was clear.

[00:21:28] Speaker 04:
The Exhibit A showed where it was.

[00:21:31] Speaker 04:
Everybody knew where it was.

[00:21:32] Speaker 04:
It was a warranty deed.

[00:21:34] Speaker 04:
This is delivered to escrow under Montana Supreme Court law.

[00:21:37] Speaker 04:
That's enough.

[00:21:38] Speaker 04:
Is that correct?

[00:21:39] Speaker 01:
That would be enough.

[00:21:40] Speaker 01:
They're on constructive notice, the case you discussed, as well as Earl V. Pavex.

[00:21:46] Speaker 02:
What are we to make of the Montana Supreme Court's decision in Towsley, then?

[00:21:53] Speaker 02:
I just don't.

[00:21:54] Speaker 02:
I'm seeing how that case is different than this.

[00:21:58] Speaker 01:
That case is substantially different, Your Honor.

[00:22:01] Speaker 01:
In Towsley, there was a notice of purchaser's interest.

[00:22:04] Speaker 01:
In Towsley, however, the contract for deed was never completed and therefore the warranty deed never recorded.

[00:22:12] Speaker 01:
Legal title never was able to merge back with equitable title in Towsley because the contract for deed was not completed nor deed recorded.

[00:22:22] Speaker 01:
That is not our situation.

[00:22:24] Speaker 01:
The contract for deed was completed and the deed recorded.

[00:22:28] Speaker 01:
Moreover, in Towson, the court said, and I respectfully disagree with my counsel, Towson, the Supreme Court said, a notice of purchase of interest may create, quote, an interest in property.

[00:22:41] Speaker 01:
It does not say it's transferring title, may create an interest in property.

[00:22:47] Speaker 01:
And when you look at 70-21-21,

[00:22:53] Speaker 01:
301 about what a conveyance is in the district court site 70-21-301.

[00:22:58] Speaker 01:
A conveyance embraces every instrument in writing by which in his state or interest affecting title occurs.

[00:23:11] Speaker 01:
And Scott Erler dentistry versus creative

[00:23:14] Speaker 01:
consultants, which is also cited by the district court, a contract for deed under Montana law is an instrument in writing which affects title.

[00:23:24] Speaker 01:
And therefore that NPI and the contract for deed did transfer, they created an interest in 2002.

[00:23:32] Speaker 01:
So Towsley, while it did discuss an NPI, was not the same situation here.

[00:23:40] Speaker 04:
Towsley, from your perspective, is very distinguishable from what we have here.

[00:23:46] Speaker 01:
It is.

[00:23:47] Speaker 01:
It is because the contract was never completed nor deed recorded, Your Honor.

[00:23:54] Speaker 01:
Moreover, in Towsley, it helps on this issue about whether this easement is adequately described, which is one of the arguments that Sutherland's made.

[00:24:03] Speaker 01:
Because as you know, in Towsley, they walk through the chain of title in that case.

[00:24:08] Speaker 01:
The Supreme Court actually walked through three certificates of survey.

[00:24:12] Speaker 01:
We have three certificates of survey in our case.

[00:24:15] Speaker 01:
However, unlike Towsley, the mine road easements description, 60 foot private road and access and utility easement and its location never change.

[00:24:26] Speaker 01:
It's always been the same.

[00:24:28] Speaker 01:
And it was originally plotted in 2001

[00:24:31] Speaker 01:
on all of the now Sutherland's property.

[00:24:38] Speaker 01:
Sutherland's also argued that they shouldn't be bound by this because they were not a party to the contract for deed.

[00:24:45] Speaker 01:
However, under early paybacks, because we have the same chain of title extending all the way from Holtz up through Sutherland, they're bound by every document and they're not treated as a stranger to that contract for deed.

[00:24:59] Speaker 01:
The Supreme Court's addressed that already in Earl V. Pavex and Scott Erdler, which I discussed earlier.

[00:25:12] Speaker 01:
Therefore, contrary to Sutherland's position, Holtz were not an intervening party in this sequence.

[00:25:18] Speaker 01:
They were just one in the title chain of the entire Sagebrush property, which at one point in time was both the Sutherland property and Waterworth property.

[00:25:41] Speaker 01:
And I don't want to beat a dead horse runner because I think we've... Let me ask my colleague whether either has additional questions.

[00:25:50] Speaker 03:
I don't.

[00:25:51] Speaker 04:
How about you Judge Wynn?

[00:25:54] Speaker 03:
No, in looking at the... Actually, I'm curious about something.

[00:25:57] Speaker 03:
So if you go south, then it looks like you're accessing a road and north access is a different road.

[00:26:04] Speaker 01:
Are you on the certificate of survey?

[00:26:06] Speaker 03:
I'm looking at exhibit A with the...

[00:26:08] Speaker 03:
Are the roads both on the northern and the southern end?

[00:26:13] Speaker 01:
No, the Eight Mile Road is on the southern end of Sutherland's property.

[00:26:19] Speaker 01:
Sutherland's bounces up to Eight Mile Road.

[00:26:23] Speaker 01:
Mine Road, they're very close the name, Mine Road extends northeasterly from Eight Mile Road through the Sutherland's property to the southeastern corner of Waterworth property

[00:26:37] Speaker 01:
up to the Missoula County, Ravalli County border.

[00:26:41] Speaker 01:
And as we put in evidence where it ends is on state property.

[00:26:45] Speaker 01:
State of Montana owned land at that point in time.

[00:26:49] Speaker 01:
So that's the two roads.

[00:26:50] Speaker 01:
They just basically go like a eight mile road is running almost East West.

[00:26:57] Speaker 01:
Mine road is running Southeast, excuse me, Southwest to Northeast.

[00:27:03] Speaker 03:
I've got it.

[00:27:04] Speaker 01:
Thank you.

[00:27:05] Speaker 04:
Very well.

[00:27:06] Speaker 04:
Thank you.

[00:27:06] Speaker 04:
Thank you.

[00:27:07] Speaker 04:
Mr. Cotadick, you have some rebuttal time.

[00:27:10] Speaker 00:
Thank you.

[00:27:10] Speaker 00:
I would first like to address Judge Wynn's question about whether the Reber Knight warranty deed was constructively delivered when it was placed in escrow.

[00:27:18] Speaker 00:
It was not.

[00:27:19] Speaker 00:
The statute before the one you asked about, 70-1-510, says delivery of a deed must be absolute, and it relieves the grantee of any further conditions.

[00:27:29] Speaker 00:
So if the deed had been constructively delivered, Reber Knight would not have been

[00:27:34] Speaker 00:
compelled to make any additional payments.

[00:27:35] Speaker 00:
The constructive delivery happened when the escrow agent received the final payment and that is the moment the deed was effectively delivered, even if Sagebrush didn't take possession of it at the time.

[00:27:46] Speaker 00:
That's what constructive delivery is.

[00:27:48] Speaker 00:
Second, the fact that the

[00:27:50] Speaker 00:
Mine Road easement is shown on various certificates of survey is irrelevant.

[00:27:55] Speaker 00:
Just because an easement is shown on a certificate of survey doesn't mean it benefits any particular party or that it creates an adverse property interest against any particular property.

[00:28:04] Speaker 00:
In this case, the easement by reference doctrine is relevant because the only way that an easement can be created by reference to a certificate of survey is if the deed to a party, in this case, the Holtz would be the relevant party,

[00:28:17] Speaker 00:
identifies a certificate of survey and it does and it's only one certificate of survey and looking at that certificate of survey, you cannot tell who the intended dominant and survey and tenements are or the easements use of necessity.

[00:28:30] Speaker 00:
Waterworth property is not even shown.

[00:28:33] Speaker 00:
It's not legally described on that easement, which is fatal under blazer in every case since then.

[00:28:38] Speaker 00:
Finally, I would just like, I know I'm out of time, I would like to point the court to the statute that says, conveniences are void if someone beats you to the courthouse.

[00:28:48] Speaker 00:
The only relevant transactions here are the deeds between Sagebrush and Rebernite and Sagebrush and hold nothing after that fact matters.

[00:28:59] Speaker 00:
And the Sagebrush to Rebernite warranty deed was too late.

[00:29:03] Speaker 00:
because the Holtz had already taken title to their property and Sagebrush lost the ability to convey an easement over property it no longer owned, which is what the Sutherland's now own.

[00:29:15] Speaker 04:
Okay.

[00:29:15] Speaker 04:
Thank you very much, both counsel.

[00:29:17] Speaker 04:
Any other further questions by my colleagues?

[00:29:21] Speaker 04:
Thank you.

[00:29:21] Speaker 04:
I think not.

[00:29:21] Speaker 04:
All right.

[00:29:22] Speaker 04:
Thank you very much.

[00:29:23] Speaker 04:
The case just argued is submitted.