Leach v. Gunnarson

290 Or. 31, 619 P.2d 263 (1980)

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Nature of the Case

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Facts

Gunnarson (D) and her husband initially owned all of the land at issue in this case. They conveyed a portion of the land to D's brother-in-law and his wife, Henry and Beth Leach, and orally granted them the right to construct and maintain equipment for drawing water from a spring located on the land retained by D. The equipment included a plastic pipe running across the surface of the land. P filed suit seeking a decree that they own in fee simple an easement for installing and maintaining a domestic water supply line and water basin and tank. The conveyance between D and P was by warranty deed and included a covenant against encumbrances. The circuit court determined that P are owners in fee simple of an irrevocable license to use the spring for domestic water supply. The court then held a separate trial on the issue of D's breach of warranty. Ps contended that, because D had covenanted against encumbrances in her warranty deed and had not excepted the P's' irrevocable license to use the spring D was in breach of her warranty deed. D filed an answer denying that P's irrevocable license to use the spring is an encumbrance. D alleged as an affirmative defense that P's' use of the spring was an open, notorious and visible encumbrance and that the license did not constitute an encumbrance, and P knew of the license. The mere existence of one or more irrevocable licenses owned by P do not constitute an encumbrance which is a breach of any covenant in the deed from D as grantors to P as grantees, if any of the irrevocable licenses were open, notorious and visible, physical encumbrances capable of being seen and known to P before they took delivery of said deed. The jury returned a verdict for D, and the circuit court entered a judgment dismissing P's complaint.