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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. AAA Valley Gravel, Inc. v. Totaro (4/25/2014) sp-6902

AAA Valley Gravel, Inc. v. Totaro (4/25/2014) sp-6902

         Notice:  This opinion is subject to correction before publication in the PACIFIC  REPORTER .  

         Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts,  

         303 K Street, Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, email  

                                                                                     

         corrections@appellate.courts.state.ak.us.  



                   THE SUPREME COURT OF THE STATE OF ALASKA  



AAA VALLEY GRAVEL, INC.,                                  )  

                                                          )    Supreme Court No. S-14680  

                           Appellant,                     )  

                                                          )    Superior Court No. 3PA-00-00716 CI  

         v.                                               )  

                                                          )    O P I N I O N  

ALICIA TOTARO and                                         )  

HERMAN RAMIREZ,                                           )    No. 6902 - April 25, 2014  

                                                          )  

                           Appellees.                     )  

                                                          )  



                  Appeal from the Superior Court of the State of Alaska, Third  

                              

                  Judicial District, Palmer, Eric Smith, Judge.  



                  Appearances:  William G. Royce, Anchorage, and Kenneth  

                                                                  

                  D. Albertsen, Palmer, for Appellant.  Richard L. Harren, Law  

                                                                    

                  Offices of Richard L. Harren, P.C., Wasilla,  for Appellee  

                  Alicia  Totaro.    Ross  A.  Kopperud,  Palmer,  for  Appellee  

                  Herman Ramirez.  



                  Before: Fabe, Chief Justice, Winfree, Stowers, Maassen, and  

                                                                                  

                  Bolger, Justices.  



                  PER CURIAM.
  

                  FABE, Chief Justice, dissenting.
  



I.       INTRODUCTION  



                  This matter returns to us after the remand proceedings ordered in an earlier  

                                                                           


----------------------- Page 2-----------------------

           1  

appeal.   The facts underlying this dispute over a 1984 gravel lease, a later sublease, and  

                                                                                                                  

overriding royalty payments under the sublease, are outlined in our previous decision.2  



                                                                 

                     Relevant to this appeal, we earlier vacated a judgment in favor of Alicia  



Totaro,   the   sublease's   overriding   royalty   interest   holder,   and   remanded   for   a  



                                                                                            

determination  whether  the  original  gravel  lease  between  Herman  Ramirez  and  Bill  



                                                                                                                   

Nelson, doing business as Cosmos Developers, Inc., was an exclusive lease for purposes  



                            3  

                                                             

of gravel removal.   The superior court conducted an evidentiary hearing and found that  



                                                                               

Ramirez and Nelson intended the original gravel lease  to be an exclusive lease.   In  



context, that finding led to the conclusion that the sublease from Cosmos to AAA Valley  



Gravel, Inc. was exclusive and that AAA Valley Gravel's gravel extraction under the  



sublease triggered continued overriding royalty obligations to Totaro.  Because AAA  



                                                                        

Valley Gravel had discontinued the overriding royalty payments to Totaro in 1998 when  



                                                                                  

it purchased the property from Ramirez, the superior court entered judgment in favor of  



                                                                                                               

Totaro for nearly $1 million in past royalty payments, interest, costs, and attorney's fees.  



                     AAA  Valley  Gravel  appeals,  arguing  that  the  superior  court  erred  by:  



                                                               

(1) failing to rule that the original gravel lease's failure to mention exclusivity rendered  



                         

the gravel lease non-exclusive as a matter of law; (2) implying exclusivity in the original  



                                                       

gravel lease as a matter of law; (3) placing the burden of persuasion on the exclusivity  



issue on AAA Valley Gravel; (4) finding that the original gravel lease conveyed an  



                                                                                             

exclusive right to extract gravel from Ramirez's property; (5) failing to find that the  



original gravel lease expired 10 to 12 years after its inception; and (6) failing to specify  



          1         AAA Valley Gravel, Inc. v. Totaro                      (AAA Valley Gravel I ), 219 P.3d 153,  



160-62 (Alaska 2009).  



          2         Id . at 155-59.  



          3         Id . at 162.  



                                                                -2-                                                          6902
  


----------------------- Page 3-----------------------

in  the  final  judgment  when  the  original  gravel  lease  would  terminate.    Ramirez,  



                                                                                

nominally an appellee in this appeal, also contends that the superior court erred; Ramirez  

essentially joins in most of AAA Valley Gravel's arguments.4  



                   For the following reasons, we affirm the superior court's judgment.  



II.       DISCUSSION  



                                                              

                                                                                      

                    1.       We are not persuaded by AAA Valley Gravel's argument that, as a  



                                              

matter of law, a non-integrated written lease agreement failing to mention exclusivity is  



                                                                                                         

non-exclusive.  In AAA Valley Gravel I , we implicitly held such silence is not dispositive  



                                                                        5  

by   remanding   for   fact-finding   on   exclusivity.       Fact-finding   would   have   been  

unnecessary if silence renders a lease non-exclusive as a matter of law.6  



                   2.        We also are not persuaded by AAA Valley Gravel's argument that  

                                                                                                          



the superior court implied, as a matter of law, an exclusivity provision into the original  

                                                                                                       



gravel lease.  The superior court found, as a matter of fact, that Ramirez and Nelson  

                                                                



intended the original gravel lease to be an exclusive lease.  We therefore review the  

superior court's factual finding for clear error.7  



          4        Totaro  contends  that  Ramirez's  brief  and  arguments  should  not  be  



considered  because:    (1)  Ramirez  waived  the  exclusivity  issue  in  the  first  round  of  

proceedings, and (2) his brief is essentially an appellant's brief and was thus filed late.  

                                             

We disagree with Totaro on this point and do  consider Ramirez's arguments on the  

                                                                      

merits.  



          5        219 P.3d at 160-62.  



          6        See also discussion infra, pp. 7-8 and related notes.  



          7        Shooshanian v. Dire, 237 P.3d 618, 622 (Alaska 2010) ("We review the  



factual findings for clear error, reversing only when - 'after a t  horough review  of the  

record'  -  we  are  left  with  a  'definite  and   firm  conviction  that  a  mistake  has  been  

made.' " (quoting Soules v. Ramstack, 95 P.3d 933, 936 (Alaska 2004))).  We reject  

AAA  Valley  Gravel's  argument  that  we  should  apply  a  less  deferential  standard  of  

                                                                                  

                                                                                                          (continued...)  



                                                             -3-                                                      6902
  


----------------------- Page 4-----------------------

                    3.       The  superior  court's  factual  finding  that  Ramirez  and  Nelson  



intended the original gravel lease to be exclusive is not clearly erroneous.  The superior  

                                                          



court reviewed testimonial and documentary evidence, made specific credibility findings  



supported  by  the  evidence,  and  made  many  specific  findings  of  fact  supporting  its  



                                                                                                                  

ultimate finding of exclusivity.  AAA Valley Gravel's argument essentially is that if the  



                                                                                                                    

credibility findings are rejected and inferences from the factual underpinning of the case  



are viewed in its favor, a finding of non-exclusivity is the only logical result.  But the  



                                                                                                                   8 

trial court makes the credibility findings and weighs the evidence, not this court;  on this 

                                               



record  we  cannot  say  that  the  superior  court  clearly  erred  in  its  factual  finding  of  

                                                                                  



exclusivity.  



                   4.        The superior court placed the burden of persuasion on AAA Valley  



                                                                                       

Gravel to prove the original gravel lease was intended to be non-exclusive.  But the  



                                                                               

superior court also ruled that even if it were Totaro's burden of persuasion to prove the  



                                                                                                              

original gravel lease was intended to be exclusive, she met that burden. We therefore do  



                                                                            

not need to address AAA Valley Gravel's argument that it was legal error to assign it the  

burden of persuasion on the exclusivity issue.9  



                    5.       AAA  Valley  Gravel's  argument  that  the  superior  court  erred  by  

                                                                                                                  



          7         (...continued)  



review to a superior court's factual findings based on non-testimonial evidence.  



          8        We   give   "[p]articular   deference"   to   a   superior   court's   credibility  



determinations.  Gold Dust Mines, Inc. v. Little Squaw Gold Mining Co., 299 P.3d 148,  

166 (Alaska 2012) (citing  Wasserman v. Bartholomew, 38 P.3d 1162, 1167 (Alaska  

2002)).  



          9        See  Harris v. AHTNA, Inc. , 193 P.3d 300, 306 (Alaska 2008) (rejecting  



argument  that  trial  court  erred  in  assigning  burden  of  persuasion  when  trial  court  

expressly  concluded  that  result  was  same  with  alternative  burden  of  persuasion  

                                                                            

assignment).  



                                                             -4-                                                       6902
  


----------------------- Page 5-----------------------

failing to find the lease expired 10 to 12 years after inception also fails.                                 We touched on  



                                          10  

this issue in the first appeal.                The lease provides that it remains in effect for as long as  



                                                                                          11  

                                                                                                                   

it is economically feasible to take gravel from the property.                                 The superior court found  



after the first trial that the parties intended the lease to expire when either:  (1) gravel  



mining  was  no  longer  economically  feasible;  or  (2)  the  property  was  suitable  for  



                                                                      12 

                                                                           But the superior court's final judgment  

residential development, whichever came first. 



stated only that the lease should be specifically performed "until it is terminated by its  



                                                          13  

terms or by agreement of the parties."                         Totaro cross-appealed this issue, arguing that  



the superior court's statement that the lease would terminate when the property was  



                                                                                        

suitable for residential development was dicta because the interplay between the "mining  



                                                                                              

no longer economically feasible" and "suitable for residential development" criteria was  



                   14  

not litigated.          Agreeing with Totaro that the issue did not appear to have been a focal  



point of the litigation and pointing to the language of the final judgment, and given our  



                                                                                            

remand on the exclusivity question, we determined that the superior court's expression  

of the lease termination criteria was not binding and would have to be resolved later.15  



                    After remand, when addressing AAA Valley Gravel's renewed argument  



                             

that the lease was intended to expire 10 to 12 years after inception, the superior court  



stated:  



          10        219 P.3d at 167.
  



          11        Id .
  



          12        Id .
  



          13        Id .
  



          14        Id .
  



          15        Id .
  



                                                                -5-                                                         6902
  


----------------------- Page 6-----------------------

                     The issue raised at trial was whether the lease had a definite           

                     term, and if so, whether that term was 10 years.  This court  

                     ruled that the lease had a definite term, but that the parties did  

                                                                          

                     not adopt a 10-year limit.  Th[is] court then articulated what  

                                                                           

                     it understood to be the actual term.  No one appealed the first  

                                                

                     two holdings; the third ruling was at issue on appeal.  And the  

                                                  

                     Alaska Supreme Court agreed . . . that it was not necessary to  

                     address precisely how to frame the actual term of the lease.  

                                                               

                     It therefore effectively vacated this court's ruling as to the  

                                                                                                           

                     precise  nature  of  the  term  of  the  lease,  holding  that  that  

                                                                       

                     matter could be addressed if necessary in the future.  



                                In  short,  the  [Supreme]  Court  did  not  vacate  this  

                                                                                           

                     court's ruling that the lease had a definite term or that the  

                                                                           

                     term was not 10 years.  Those rulings therefore stand.  And  

                     since AAA and Mr. Ramirez did not appeal those rulings,  

                     they cannot properly argue at this point that the lease had a  

                     10 year term. (Citation omitted).  



                     The superior court correctly interpreted our earlier decision.  AAA Valley  

                                                    



Gravel's argument on remand that the lease expired 10 to 12 years after inception was  

                                                                       



not properly before the superior court nor is it properly before us in this second appeal,  

                                                                       



and we do not address it.   



                     6.         Finally, we do not agree with AAA Valley Gravel that the superior  

                                                                                                                       



court erred by not including in the final judgment a specific description of when the  



original gravel lease would terminate.  The superior court's original ruling that the lease  

                                                                                                            

had a definite term was not appealed and was the law of the case,16 

                                                                                                        although the specific  



articulation of the termination criteria had not been adjudicated.  On remand the parties  



did not litigate the termination criteria, other than AAA Valley Gravel's attempt to re- 



                                                                                    

litigate its contention that the lease expired 10 to 12 years after inception.  The lease's  



           16        Beal v. Beal , 209 P.3d 1012, 1016-17 (Alaska 2009) (explaining "law of  



the case" doctrine generally prohibits reconsideration of issues that were or could have  

been adjudicated in previous appeal).  



                                                                  -6-                                                                6902  


----------------------- Page 7-----------------------

termination  date  remains  for  resolution  by  the  parties,  through   agreement  or  future  



litigation, but its resolution is not necessary in connection with the present appeal.  



                                                                                 

                    At oral argument, AAA Valley Gravel tangentially raised the question of  



                                 

the enforceability of a lease exclusivity provision lacking a reasonable time limitation.  



                                                                                                

AAA Valley Gravel's argument is difficult to discern from its briefing, but it points to  



                                                                                                            

a case involving a shopping center lease and suggests that exclusivity provisions with  

unreasonable geographic or temporal parameters are unenforceable restraints on trade.17  



This argument causes us to reflect on the substantive nature of the gravel lease in this  



case - although the parties did not discuss this point in the original trial, the first appeal,  

                                                                                    



or the  second trial after remand, a gravel lease is a kind of easement, specifically a  



          18  

                                                                                         

profit.       A profit's exclusivity derives from the nature of the property right conveyed;  

                                                                                       19  Conversely, exclusivity in  

                                                                                            

the profit holder generally has the right to exclude others.  



          17        See, e.g., Horton v. Uptown Partners, L.P.                       , 720 N.W.2d 192 (Iowa App.  



2006)  (unpublished  table  decision)  (holding  exclusivity  clause  in  lease  must  be  

reasonable in duration and scope to not be restraint on trade).  



          18  

                                                                                       

                    Laverty v. Alaska R.R. Corp. , 13 P.3d 725, 735-36 & n.51 (Alaska 2000)  

                                                                                                   

(holding gravel mining agreement conveyed "a kind of easement, specifically a 'profit' "  

(citing  RESTATEMENT  (THIRD)  OF  PROP .:   SERVITUDES    1.2  (2000))).    The  parties  

presented this case to the superior court and to this court as one of contract interpretation.  

                                                                                    

Although  there  is  some  difference  in  the  interpretation  rules  for  contracts  and  for  

                                                                                                  

conveyances, had the case been presented as one of conveyance interpretation, the result  

                                                                

(remand for trial on whether the parties intended the lease to be exclusive) likely would  

                                                                                                                 

have been the same.   Compare AAA Valley Gravel I , 219 P.3d at 160-62 (interpreting  

                                                                    

lease contract terms), with Dias v. State, Dep't of Transp. & Pub. Facilities , 240 P.3d  

                                          

272, 274-75 (Alaska 2010) (interpreting easement conveyance deed terms).  But, given  

                                                                             

how the parties litigated this case, we do not need to consider that question.  



          19        RESTATEMENT (THIRD) OF PROP .: SERVITUDES  1.2 cmt. c (2000); 3 Rocky  



Mountain Mineral Law Found., A 

                                                   M .  LAW OF MINING 82-03[3], at 82-14 (2d ed. 2013)  

(noting profits are presumptively exclusive).  



                                                               -7-                                                         6902
  


----------------------- Page 8-----------------------

                                                                                                                          

a shopping center lease refers to the landlord's covenant not to lease other property to  



the  tenant's  competitors;  it  imposes  a  burden  on  the  landlord's  remaining  property  



          20  

rights.          The  rule  that  exclusivity  covenants  in  such  leases  must  be  reasonable  in  



duration as restraints on trade applies to covenants burdening the landlord's property  



         21                                                                                                                  22 

                                                                                                                                  

right,      not to real property conveyances such as the profit granted in this case.                                            In any  



                                                                  

event,  AAA  Valley  Gravel's  argument  ignores  the  facts  that  (1)  the  superior  court  



determined that the lease has a defined end date, and (2) the exclusivity provision expires  



                                                                                    

when the lease expires.  Contrary to AAA Valley Gravel's urgings, the lease and its  



exclusivity provision are not endless.  



III.       CONCLUSION  



                                                                                                                     

                     For the foregoing reasons, we AFFIRM the judgment of the superior court.  



           20        See, e.g., Davidson Bros. v. D. Katz & Sons , 579 A.2d 288, 295-96 (N.J.                          



1990).  



           21        3  MILTON   R.   FRIEDMAN  &   PATRICK  A.   RANDOLPH ,   JR .,  FRIEDMAN  ON  



LEASES   28:1, at 28-1 (Patrick A. Randolph, Jr. ed., 5th ed. 2005);                                     Horton , 720 N.W.2d   

192; Davidson Bros. , 579 A.2d at 295-96.  



           22         8 THOMPSON ON  REAL PROPERTY  65.03(b), at 42 (David A. Thomas ed.,  



2d ed. 2005) (explaining landlord/tenant lease rules do not apply to profits, and attempts  

                                                                           

to apply those rules to profits are "quite obviously mistaken").  We do not, as the dissent  

                                                                                                                       

suggests,  make  this  point  to  rule  as  a  matter  of  law  that  the  lease  was  exclusive.  

Regardless of the nature of the lease, the superior court found that the parties intended  

                                                                                           

it to be exclusive.  Although our point does lend support to our intial remand for that  

                                                

finding, here it is directed to the restraint of trade issue raised by AAA Valley Gravel.  



                                                                   -8-                                                             6902
  


----------------------- Page 9-----------------------

FABE, Chief Justice, dissenting.  



                                     

                    I continue to hold the view, expressed in my dissent in the first appeal in  



this case, that the "hopelessly deficient" lease between Ramirez and Cosmos "cannot  



possibly sustain . . . [the] highly restrictive, multi-decade arrangement" that the court  



                       1  

                                 

today enforces.           For the reasons explained in my first dissent and below, I would hold  



                                                         

that the lease's silence on exclusivity is sufficient to render the lease non-exclusive as a  



                    2 

                                                                                                               

matter of law.   AAA's obligation to pay royalties to Totaro ended when it purchased the  



                                                                                              

property and began gravel mining as the owner; therefore, the superior court's decision  



holding AAA liable to Totaro should be reversed.   



                    As  the  court  itself  noted  in  the  first  appeal,  "[c]ontract  interpretation  



                                                3  

                                                   and involves fact-finding only when "when facially  

generally is a question of law" 



ambiguous  contract  language  read  in  the  context  of  all  relevant  extrinsic  evidence  



                                4 

                                                                                 

remains ambiguous."   Because the plain language of the lease is not facially ambiguous  



                                                                                                              

on the issue of exclusivity, it was unnecessary to remand to the superior court for fact- 



                                                                          

finding on the parties' subjective intent.  Despite recognizing our long-held standard on  



          1         AAA Valley Gravel, Inc. v. Totaro                 , 219 P.3d 153, 168 (Alaska 2009) (Fabe,  



C.J., concurring in part and dissenting in part).  



          2         Id. at 169-70 ("Ambiguity in a contract does not arise from silence.  And  

                                                                                                       

unambiguous contract language is not rendered ambiguous simply because the parties  

disagree  on  their  intent  at  the  time  of  contracting,  because  they  advance  different  

interpretations  during  the  course  of  litigation,  or  because  the  clear  meaning  of  the  

language used would work a hardship on one of the parties.  By omitting any mention  

of exclusivity, Ramirez retained a concurrent right to mine the gravel on his property.")  

                                                    

(internal citations omitted).  



          3         Id. at 160 (per curiam) (citing Norville v. Carr-Gottstein Foods Co. , 84 P.3d  



996, 1004 (Alaska 2004)).  



          4  

                                                                                           

                    Id. at 161 (citing Little Susitna Constr. v. Soil Processing, Inc. , 944 P.2d  

20, 23 (Alaska 1997)).  



                                                               -9-                                                         6902
  


----------------------- Page 10-----------------------

                                                                           

contract interpretation, the court in its earlier decision strained to introduce ambiguity  



                                                                                  

into the lease's silence on exclusivity, couching its conclusion in equivocal terms:  "The  



                                                                                                                

Ramirez/Cosmos lease does not mention exclusivity, but even though silent, some of its  

                                                                                                                              5   It was  

                                                                                                                                   

provisions may make sense only if the lease had been intended to be exclusive."  



inappropriate for the court to augment the lease's plain language to "create ambiguity  

                                                                                  



regarding  the  existence  of  such  a  crucially  important  restriction  in  a  lease  that  is  



                                                                     6  

                                                                        Because ambiguity in a contract generally  

otherwise completely silent on the matter."  



                                               7  

does  not  arise   from   silence,   especially  with  regard  to  a  provision  as  important  as  



exclusivity, I conclude that the lease between Ramirez and Cosmos was not exclusive.  

                                                                                                                     



As I noted in my earlier dissent, "[j]ust as Ramirez had the right to mine the gravel pit  

                                        



as fee simple owner, unencumbered by the lease with Cosmos, so too did AAA enjoy the  

                                                                              



full panoply of ownership rights after the sale.  When AAA secured the right to mine the  

                                                                                               

pit as its owner, its obligation to pay royalties to Totaro as a sublessee ended."8  

                                                                                                                                 



                     But the court goes further than it did in the first decision, reaching an issue  

                                                                           



today that was neither raised nor briefed by the parties.   The court characterizes the  

                                                                                                                



           5         Id. at 160 (emphasis added) (footnote omitted).  



           6         Id. at 169 (Fabe, C.J., concurring in part and dissenting in part).  



           7         See  Nissho Iwai Europe PLC v. Korea First Bank , 782 N.E.2d 55, 60 (N.Y.   



2002) ("[A]s with all written agreements . . . ambiguity does not arise from silence, but                        

from  'what  was  written  so  blindly  and  imperfectly  that  its  meaning   is  doubtful.'  "  

(citation omitted)); Consol. Bearings Co. v. Ehret-Krohn Corp., 913 F.2d 1224, 1233  

(7th Cir. 1990) ("Silence creates ambiguity . . . only when the silence involves a matter  

                                                                                                                

naturally within the scope of the contract as written.  A contract is not ambiguous merely  

because it fails to address some contingency; the general presumption is that 'the rights  

                                                    

of the parties are limited to the terms expressed' in the contract." (citation omitted)).  



           8  

                                                                                                       

                     AAA Valley Gravel , 219 P.3d at 170 (Fabe, C.J., concurring in part and  

dissenting in part).  



                                                                  -10-                                                             6902
  


----------------------- Page 11-----------------------

                      

gravel lease as a type of easement, specifically a profit.  But characterizing the lease as  



a profit does not remove the need for an express grant of exclusivity.  Profits may be  



                                                                                                       

exclusive or nonexclusive, and "[t]he degree of exclusivity of the rights conferred by an  



                                                               9  

                                                                  The court claims that a "profit holder generally  

easement or profit is highly variable." 



                                                    10  

                                                                                                    

has the right to exclude others."                       But the court fails to point to any case in which a court  



has held that profits are presumptively exclusive.  The court's sole source of authority  



is a general statement from a treatise that "[a profit à prendre] creates a commercial,  



rather than a personal, relationship between the parties and is presumptively assignable,  



                                              11  

                                                                

inheritable, and exclusive."                      But the only cases relied on by that treatise in support of  



                                                                                   12  

                                                                                                      

its statement involve express grants of exclusivity.                                   Indeed, other courts have held that  



           9          RESTATEMENT (THIRD) OF PROPERTY :   SERVITUDES     1.2  cmt. c (2000).  



           10         Op. at 7.  



           11         3 Rocky Mountain Mineral Law Found., A                                 M .  LAW OF MINING   82-03[3],  



at 82-14 (2d ed. 2013).  



           12         Id. (citing Gerhard v. Stephens, 442 P.2d 692 (Cal. 1968);                                      Bonner v. Okla.  



Rock Corp. , 863 P.2d 1176 (Okla. 1993) (other citations omitted)).  The conveyance in       

Gerhard  was explicit on exclusivity, conveying "                                all petroleum, coal oil, naptha, asphalt,  

maltha, brea, bitumen, natural gas and other kindred or similar substances and deposits                  

and rocks, gravels or other formations containing or yielding any of said substances,"  

and these rights were "transferred to the corporation, its successors and assigns forever ."  

442 P.2d at 732 n.4 (emphases added).  Similarly, the easement in Bonner read:  "It is  

                                                                                      

the intent and purpose of this instrument to give the Grantee, its successors and assigns,  

                                                                                                      

a perpetual and exclusive right to go upon the property to test, mine, quarry and remove  

                                                                                                                  

such gravel, stone, rock, shale, and limestone and to process the same thereon."  863  

                                                                                                                                         

P.2d at 1179 n.10.  



                      These clear statements on exclusivity and duration stand in stark contrast  

                                                                                                                          

to the vague and equivocal language in the Ramirez/Cosmos lease, and  Gerhard and  

Bonner provide scant support for the court's claim that profits are "generally" exclusive,  

                                                                          

especially where a lease is silent on the matter.  



                                                                     -11-                                                               6902
  


----------------------- Page 12-----------------------

as a general matter, "profits [à] prendres are not  exclusive to the holder for 'the grant of   



a profit [à] prendre does not preclude the grantor from exercising a like right upon the  



                                                                     13  

                                                                         Of course, parties can contract for an  

land or granting such right to others also.' " 



                                                                             

exclusive profit, but as with other contracts, courts have rightly required clear statements  



                                                                             

of exclusivity:  "A profit à prendre is a right to take something off another person's land;  



                                                              

such a right does not prevent the owner from taking the same sort of thing from off his  



                                                      

own land; the first right may limit, but does not exclude the second.  An exclusive right  



                                               

to all the profit of a particular kind can no doubt be granted; but such a right cannot be  



                                                                                            14  

inferred from the language when it is not clear and explicit."                                   



                    Because the characterization of the lease as an easement has never been  



litigated by the parties, AAA and Ramirez also have not had the opportunity to argue that  

                                             



any exclusive servitude that may have been created by the lease must be limited to a  



reasonable duration:  "Servitudes may be interpreted to include a reasonable durational  



limit . . . when the time limit lessens the chances that the servitude will operate as an  



                                                                                                              15  

unreasonable restraint on alienation or otherwise violate public policy."                                         Even if the  



                                                                 

lease   could   support   the   interpretation   that   it   granted   an   exclusive   profit,   the  



                                                                                                       

reasonableness of the duration of exclusivity of such a profit was not raised by the parties  



                                             

or addressed by the superior court.  And if the lease did in fact grant an exclusive profit  



                                                                             

to Cosmos, then the existence of such a servitude would certainly violate the warranty  



          13        State ex rel. Rohrer v. Credle, 359 S.E.2d 45, 47 (N.C. App. 1987)                                     aff'd,  



369  S.E.2d  825  (N.C.  1988)  (emphasis  added)  (italics  removed)  (quoting  Builders  

Supplies Co. of Goldsboro, N.C., Inc. v. Gainey, 192 S.E.2d 449, 453 (N.C. 1972)).  



          14  

                                     

                    Stanton v. T. L. Herbert & Sons, 211 S.W. 353, 354 (Tenn. 1919) (citation  

omitted).  



          15        RESTATEMENT  (THIRD)  OF  PROPERTY :   SERVITUDES     4.3  Reporter's  N.  



(2000).  



                                                              -12-                                                         6902
  


----------------------- Page 13-----------------------

deed conveyed by Ramirez as the court itself acknowledged in the first appeal: "by                                                                                                                                                              



conveying with a warranty deed it was Ramirez, not AAA, who 'decided that it was best                    



to proceed and to run the risk' that the Ramirez/Cosmos lease would have continued                                                                                                                            

legal viability and be an encumbrance against title to the property."16  



                                           For these reasons, I respectfully dissent.   



                         16               AAA Valley Gravel , 219 P.3d at 163.  



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