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Gerald Toste et al v. First American Title Insurance Company

March 28, 2012


(Super. Ct. No. PC20070292)

The opinion of the court was delivered by: Robie , J.

Toste v. First American Title Ins.



California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

This is the fifth appeal involving an easement on land owned by plaintiffs Gerald and Robin Toste (the Tostes) for the benefit of their neighbors, the Smedbergs. In the first, we affirmed an award of compensatory and punitive damages against Gerald Toste for willfully interfering with the easement. (Smedberg v. Toste (Dec. 10, 2008, C056578) [nonpub. opn.].) In the second, we sanctioned the Tostes and their attorney, Charles Kinney, for filing a frivolous appeal that "recycl[ed] the same arguments" from the first appeal. (Smedberg v. Toste (Sept. 28, 2009, C058031) [nonpub. opn.].) In the third, we affirmed the dismissal of the El Dorado Superior Court as a party in the Tostes' action for inverse condemnation. (Toste v. Superior Court (Oct. 27, 2009, C058938) [nonpub. opn.].) In the fourth appeal, we affirmed an order denying Gerald Toste's challenge of the denial of his claim of exemption to the Smedberg's wage garnishment. (Smedberg v. Toste (Mar. 6, 2012, C068218) [nonpub. opn.].)

This fifth appeal fares no better for the Tostes. Here, the Tostes claim the trial court erred in granting summary judgment in favor of defendant First American Title Company (First American) in a lawsuit the Tostes filed against First American. The preliminary title report First American issued on the Tostes' property missed the easement encumbering the Tostes' property. The lawsuit alleged breach of contract against First American. The trial court granted summary judgment in favor of First American. The Tostes appeal from the resulting judgment. They contend the court erred in granting summary judgment because triable issues of material fact existed. As best we can discern, the Tostes develop seven issues.*fn1 Finding no merit in them, we affirm the judgment.


In June 1999, the Tostes purchased property in Pollock Pines consisting of a home on about one acre. First American issued a title insurance policy on the property. The policy failed to note the property was encumbered by an easement held by the Smedbergs.*fn2

In May 2006, the Tostes made a claim under the policy after the Smedbergs notified the Tostes they were going to construct a driveway on the easement. That same month, the Tostes (among other things) piled obstructions on the easement, scared off the Smedbergs' contractors with growling dogs, and removed erosion control devices on the easement.

On June 1, 2006, First American wrote the Tostes a letter acknowledging the easement. The letter explained that First American would pay for the actual loss the Tostes incurred because of the easement, which was to be determined by an independent appraiser based on the difference in value of the property with the easement and without it.

On June 6, 2006, the Smedbergs wrote a letter to First American informing the insurance company that the Tostes had physically blocked access to the easement and threatened litigation.

On June 15, 2006, First American wrote a letter to the Tostes reiterating its decision to pay for the actual loss caused by easement on their property, thus eliminating any duty to defend the Tostes if they were sued. However, the letter also stated, "If the Smedbergs bring a legal action against you, please send [First American] copies of the summons and complaint promptly so that we can evaluate the allegations for any potential obligation to defend you."

On July 3, 2006, the Smedbergs filed a lawsuit against the Tostes to quiet title and to allege trespass and nuisance causes of action based on the Tostes' interference with the use of the easement.

After the Smedbergs filed their lawsuit, the Tostes hired attorney Kinney to defend them in that lawsuit.

On July 8, 2006, Kinney wrote First American a letter stating he had been retained by the Tostes to defend them in the Smedbergs' lawsuit and included the complaint and other documents relating to the lawsuit. It was the Tostes' and Kinney's position that the Tostes had adversely possessed the easement. Kinney also stated that he had already filed a declaration and opposition to the Smedbergs' motion for preliminary injunction.

On July 13, 2006, the El Dorado Superior Court granted the preliminary injunction enjoining the Tostes from interfering with the Smedbergs' use of the easement.

Later that month, Kinney filed an answer and cross-complaint on behalf of the Tostes.

In August 2006, First American wrote Kinney a letter stating that it had reconsidered its decision to pay the Tostes for their loss from the easement and would instead defend them in the Smedbergs' action. It warned, however, that it would not pay to prosecute the cross-complaint. First American retained attorney William Barnes to defend the Tostes against the Smedbergs' lawsuit. The title insurance policy stated, "We have the right to choose the attorney when [w]e bring or defend a legal action on [y]our behalf." "We are required to repay [y]ou only those . . . attorneys' fees . . . that [w]e approve in advance."

In April 2007, the El Dorado County Superior Court found Gerald Toste guilty of 12 counts of contempt for violating the preliminary injunction. Thereafter, the court ordered Gerald Toste to serve 60 days in jail for violating the preliminary injunction and awarded costs to the Smedbergs in response to their memorandum of costs.

In May 2007, Kinney filed a lawsuit on behalf of the Tostes against El Dorado County alleging the county had created a dangerous condition by approving construction of the Smedbergs' driveway on the easement and later amended the complaint to add a cause of action for inverse condemnation against the El Dorado County Superior Court.

The Smedbergs' lawsuit and Tostes' cross-complaint went to trial in June 2007. Both attorneys Barnes and Kinney were at the trial and the Tostes elected to have Kinney handle the examination of witnesses and argument to the jury. A jury rejected the Tostes' claim of adverse possession and found Gerald Toste liable for nuisance and trespass ...

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