Over the Line:
Misplaced fences, roads and other boundary disputes
There’s an old saying, “Good fences make good neighbors.” While that may be true normally, sometimes a neighbor’s fence is out of place and on your side of the property line. Encountering a boundary dispute with an adjacent neighbor is a fairly common issue for landowners. There are many ways a boundary dispute can arise. Sometimes, deed descriptions are inaccurate and have been that way for a long period of time and through several transfers of the property. Other times, though the neighbors all agree that the legal description is correct, one neighbor has been occupying a portion of the land for long enough to claim ownership of it. This usually happens under a theory of “adverse possession” or a “Boundary by Acquiescence.”
Property lines are often poorly understood unless fenced off and posted carefully. It is common for owners to suddenly realize that land is, or is not theirs, despite a long running understanding. Many times, a property owner will not know the true property line until they decide to sale the property and look at the actual survey of the land. To understand a property dispute, you must first understand property boundaries and property lines.
What exactly is a boundary or property line?
What are boundaries or property lines? Essentially, these are the lines on a county’s tax map that define and set apart different parcels of land. A property line is often an imaginary line through a lawn or field. Property lines and boundaries are what separates your property from your neighbors. In other words, they detail the exact amount of land you own and subsequently what this land is worth. That two feet that your neighbor is claiming could be a huge difference maker in the value of your property, depending on what is located on that two feet. Now that you understand what a property line is, let’s look at the ways someone could claim ownership of your property and subsequently devalue your property.
Adverse Possession – – How many hurdles did your neighbor jump?
Adverse possession is a legal concept that allows a trespasser—sometimes a stranger, but usually a neighbor—to gain legal title over someone else’s land. Arkansas courts continue to enforce this doctrine when one owner has neglected or forgotten about a piece of land while another has been using and/or caring for the land for a long period of time that making the trespasser leave would seem unfair, or create hardship on the trespasser. In other words, if a trespasser spends enough time caring for a piece of property that the true owner has neglected, and the true owner makes no objection, a court might award “ownership” to the trespasser.
Adverse possession should not be confused with having an easement to use another person’s property—for example, when a neighbor has an easement to use your driveway to access his or her house. Easements involve shared rights with others in pieces of property, whereas adverse possession results in a shift in title, and the corresponding right to exclude others from the property.
For a person to successfully claim ownership and gain title through adverse possession, several hurdles must be met. A trespasser’s possession must be (1) hostile (against the right of the true owner and without permission); (2) actual (exercising control over the property); (3) exclusive (in the possession of the trespasser alone); (4) open and notorious (using the property as the real owner would, without hiding his or her occupancy); (5) continuous for the statutory period (which is seven years in Arkansas, under Ark. Code Ann. § § 18-61-106); and (6) be accompanied by full payment of taxes over those years. In Arkansas, the trespasser must pay property taxes for all seven years. A trespasser cannot simply come onto your land, while you pay those taxes, and wait.
This may be better explained through an example. Taylor Swift decides she is going on an eight-year world tour. She currently owns a two-hundred-acre home with land outside of Little Rock, Arkansas. A day after Taylor leaves for tour, Kanye West decides to move onto her property with the Kardashian family and claim it as their own. Taylor never gave permission for Kanye to use her land as his own. In fact, she has disliked Kanye since he ruined her acceptance speech at the Grammys. While gone, Kayne, Kim, and the rest of the Kardashian bunch stay at the property and use it as their own. They let the whole world know of their use of the property and do not try to hide it. In fact, they even shoot seven seasons of Keeping up with the Kardashians on the property. The do not leave the property for the entire eight years Taylor is on tour. They have completely made nit their own. In fact, Kanye started a beet farm there and added an addition to the home. Finally, while gone, Taylor’s financial advisor quit. In fact, Taylor did not pay any property taxes on the property since she left for tour. Meanwhile, Kanye knew the taxes were not being paid and paid them under his name.
Taylor finally finishes her eight-year world tour and is so ready to get home. She is exhausted and cannot wait to sleep in her own bed. When the tour bus arrives to her residence, Taylor is astonished when she sees Kanye and the Kardashians running all over her property. She confronts Mr. West, who say, “Yo this land is Yeezy and Kim’s now. Go write another song about past boyfriends somewhere else and get off my property!” Taylor is so upset she leaves and immediately writes a song called, “He Stole My Land like He Stole My Heart.” (It later hit #1 and Kanye has since remixed the song for the dance floor).
The next day, Taylor sued Kanye West to recover her property. The Court told Ms. Swift that she needs to just “Shake It Off” and that the land has been adversely possessed by Mr. West. The court stated that Kanye had met all the elements, including paying the taxes, during the seven-year statutory period. Consequently, the court vested title ton the land to Kanye West by virtue of adverse possession.
While this may have seemed like a silly example, it hopefully has helped you to better understand what the elements of adverse possession are and how they are proven.
Boundary by Acquiescence: The easier way to steal your neighbor’s land
Boundary by acquiescence allows recognition of a boundary where there is an unspoken agreement between the parties, recognition of the boundary for a long period of time, and a fixed line that is definite and certain. A boundary by acquiescence is usually represented by a fence, a lane, a ditch, or some other monument which, unspoken and implied, is accepted as visible evidence of a dividing line. A boundary line by acquiescence is inferred from the landowners’ conduct over many years to imply the existence of an agreement about the location of the boundary line. In other words, if your neighbor’s fence has been three feet over in your yard for the last five years and you both have acknowledged the fence, then it is implied that you both agree that this is the boundary line.
In acquiescence cases, neither neighbor intends to take property from the other, but there is a mutual mistake as to the location of the actual boundary line. A claim in an acquiescence case cannot be hostile if both neighbors believe they are observing the true boundary line.
Boundary by acquiescence requires three key elements: 1) a tacit (unspoken and implied) agreement between the parties; 2) recognition of the boundary for a long period of time; and 3) a fixed line that is definite and certain. The “tacit” agreement between the parties must be mutual, however, silence can be interpreted as an agreement. If your neighbor’s fence is on your property and you know it is, you should voice that it is, and the land belongs to you even if you are okay with the fence being located where it is. It is best to do this in writing and save it as proof. By voicing your objection, you should have raised a sufficient objection to refute the other person from being able to claim your property through boundary by acquiescence.
The Arkansas Supreme Court requires a minimum of seven year to claim property through boundary by acquiescence. However, some cases merely require a “long-period of time.” This opens the door for arguments that boundaries can be taken in less than seven years. The period would vary with the facts of each case. So, the best line of defense to avoid a boundary by acquiescence from your neighbor is to alert them periodically that that fence is not the true boundary line.
Prescriptive Easement- On the Road Again
A squatter who cannot establish all the elements of adverse possession or boundary by acquiescence, may be able to acquire a permanent right to continue a historical use of the occupied land by acquiring a prescriptive easement. The elements of a prescriptive easement are nearly the same as for adverse possession: an open and notorious use of the property for a continuous period of five years or longer, under a claim of right to the use the property, in a manner that is contrary to the true owner’s rights. A prescriptive easement does not require the payment of taxes except in the rare instance where the disputed property is separately assessed.
A successful claimant of a prescriptive easement does not acquire title, but, rather, acquires the right to continue a specific historical use of someone else’s property. This is a non-possessory and limited right to use the property, such as a road over your neighbor’s land which goes to your land. But this right to a specified use is a lesser right than outright ownership. You can never claim ownership under a prescriptive easement; however, you may claim an indefinite right to use the land.
When dealing with any sort of boundary dispute, it is best to act early. As soon as you realize that someone has encroached on your property, notify them in writing, even if you are fine with their use at the time. If someone refuses to leave your land, remove their fence, or acknowledge the actual boundary or property line, review all the elements of the for adverse possession and boundary by acquiescence above. More than likely, they will have missed at least one of these elements. You should then contact an attorney to resolve the dispute legally and remove the trespassers from your land.
At WH Law, we have helped many landowners resolve boundary disputes and restore them to their previous property rights. Whatever the reason someone has claimed an ownership to your property, call us today so we may help you to stop another person from claim stealing your land and thus protect the value of your property.
Having a lien placed on your property can be detrimental to the title of the property. A Materialman’s or Mechanics lien will “cloud the title” of the property. This means that the lien will appear in public records. This also means that any lien must be paid off before you, as the homeowner, can sell, refinance, or borrow against the equity on your property.
So, what do you do if someone has tried and /or placed a lien on your property? Luckily, Arkansas Materialman’s and Mechanics Lien Statutes are strictly construed and must be followed exactly as stated in the statute.
There are several steps to placing a lien on your property. If one of these steps was not completed by the person placing the lien, you, as the homeowner, can have it removed and invalidated.
When Was the Work Finally Completed?
In Arkansas, under A.C.A. 18-55-115, a lien claimant only has 120 days to file a lien against someone in which they claim has not paid for their services or materials. This 120-day time limit is calculated from the last day that the lien claimant completed any sort of work on the property. If someone completed work 125 days prior to attempting to file a lien on your property, you can quickly invalidate the lien due to this strictly construed timeline. So, when dealing with any lien claimant, you should always first calculate the timeline to make sure the claimant is within the 120-day time limit. This will be your first defense against a lien being placed on your property.
Did You Receive a Pre-Construction Notice?
Before any work is to begin on your property, the contractor, subcontractor, and/or supplier of materials MUST provide you with a “Pre-Construction Notice.” A.C.A. 18-55-115 states “It shall be the duty of the residential contractor to give the owner, the owner’s authorized agent, or the owner’s registered agent the notice set out in this subsection on behalf of all potential lien claimants before the commencement of work.” The Notice must be given to you verbatim as it is set out in the statute. Normally, it is a requirement that you sign an acknowledgement of this notice as well. This notice is a vital defense against a lien being placed on your property. If you were not provided this notice in your contract, then no lien may be placed on the property. Luckily for you, many contractors are unaware of this requirement, so be sure to check your contract for this notice. No Notice equals No Lien!
Were you Sent a 10 Day Notice?
Another important step in properly placing a lien is sending the homeowner a “Notice of Intent to File a Lien.” This Notice must be sent AT LEAST 10 days before filing a lien. The 10-day notice must contain a description of the property, the identity of the lien claimant, the identity of the person who has failed to pay, and the total amount due. The notice must be given by personal service, certified mail, or through a process server. If you were sent this 10-day notice, check and double check that it contained all the elements stated above. If it did not, you may use this as an argument to invalidate and remove the lien.
Are You Verified?
Within 120 days of the last date of labor or materials supplied, and at least 10 days after furnishing the “Notice of Intent to File a Lien,” any lien claimant MUST file a “Verified Statement of Account and Claim of Lien” with the circuit clerk of the county in which the property is located. The verified statement must be notarized, and MUST contain the following: 1) it must contain the legal description of the property, 2) the amount due, 3) the identity of the property owner, 4) the identity of the lien claimant, and 5) an affidavit of notice. A.C.A. 18-44-117 also states it must contain, “(1)A sworn statement evidencing compliance with the applicable notice provisions of 18-44-114 — 18-44-116; and (2) A copy of each applicable notice given under 18-44-114 — 18-44-116.” The good news for you is the statute goes on to state, “The clerk shall refuse to file a lien account that does not contain the affidavits and attachments required by this section.”
The Take Away
As you can see from above, in Arkansas, placing a Mechanics or Materialman’s Lien on property is not as easy as going to the courthouse and filling out a piece of paper. Several steps must be taken, and several notices must be given in advance. All these steps and notices must be done in a specific manner as well. You, as a homeowner, never want a lien placed on your property. If someone has placed a lien on your property, review all the steps above to make sure the lien claimant was complying. At WH Law, we have helped several homeowners remove erroneously placed liens on their property. Whatever the reason someone has placed or is attempting to place a lien on your property, call us today so we may help you to stop a lien claimant or remove the lien and thus protect the value of your property.
Many contractors still believe they can work off a handshake and an estimate. Those days have long passed, and a construction contract is needed today more than ever to protect you and your interest as a residential contractor or subcontractor.
Sites such as Rocketlawyer seem like they are the perfect answer to drafting your own construction contract. They make claims of amazingly low cost deals for all your contract needs. Will a contract from one of these sites protect you as a contractor or subcontractor doing work in Arkansas? Absolutely not. Arkansas Construction laws are specific to the State of Arkansas and the online form contract simply won’t cut it. Many notices must be given in a construction contract and each notice will depend on the type of construction work being done by the contractor. Websites that offer low cost contracts do not make their contracts specific to the laws of the state requested. In fact, they usually use the same language in all their contracts and merely change the name of the state on the contract. You should never use a form contract from one of these websites.
Absolutely. Mechanic’s liens are legal documents that essentially reserve the rights of the person who filed the lien to seek unpaid compensation. They are usually filed by contractors, subcontractors, or suppliers that never received payment for work that they performed or materials that they provided on the property. Placing a lien on someone’s property causes a severe penalty to the homeowner and/or commercial property owner. A Mechanic’s or Materialman’s Lien will “cloud the title” to the property. This means that the lien will appear in public records. This also means that any lien must be paid off before the homeowner can sell, refinance, or borrow against the equity on their property. In practical terms, placing a lien on a property creates a major nuisance for any owner of the property. Creating this nuisance will help get you, as the contractor or subcontractor, the money you are owed for the work you have completed.
In the summer of 2017, the Arkansas Legislature revised the Arkansas Mechanic’s and Materialman’s Lien Statute A.C.A. 18-44-115. This revision has created harsh penalties for contractors and subcontractors who fail to get the “Important Notice to Owner” signed before the construction project begins.
A.C.A. 18-44-115 states “No lien upon residential real estate containing four (4) or fewer units may be acquired by virtue of this subchapter unless the owner of the residential real estate, the owner's authorized agent, or the owner's registered agent has received, by personal delivery or by certified mail, a copy of the notice set out in this subsection.” This notice must be in the contract and signed before any construction work begins. This Notice must also be stated exactly as it is written in the statute. While getting a lien placed on property can be a very effective way to get payment for work completed yet the homeowner has failed to pay for, it is the 2017 revision that has caused great concern when dealing with unpaid construction work.
In 2017, this statute added a section which states, “ If a residential contractor fails to give the notice required under this subsection, then the residential contractor is barred from bringing an action either at law or in equity, including without limitation quantum meruit, to enforce any provision of a residential contract.” This provision is a severe penalty for any contractor who has done work and not been paid. Quantum Meruit is Latin for "as much as he deserved," the actual value of services performed. Quantum meruit determines the amount to be paid for services when no contract exists or when there is doubt as to the amount due for the work performed but done under circumstances when payment could be expected.
This change also bars a contractor from being able to sue for unjust enrichment. Unjust enrichment occurs when Party A confers a benefit upon Party B without Party A receiving the proper restitution required by law. This typically occurs in a contractual agreement (such as a residential construction project) when Party A fulfills his/her part of the agreement and Party B does not fulfill his/her part of the agreement. In other words, it is much like Quantum Meruit. You, as the contractor or subcontractor, have completed residential construction work for your client, your client has benefited from the work you completed, yet your client/homeowner refuses to pay for your services.
By adding in this language, the Arkansas Legislature has effectively taken away a contractor’s right to recover any monies owed to them if they fail to have this pre-construction notice signed. Not only will the contractor be barred from being able to place a lien on the property, but now they will not be able to sue and recover the money owed to them for materials used and work completed as well. While I personally believe there is a constitutional argument to the validity of this provision, it is the law we must work within for the time being. In other words, be forewarned that as a residential contractor or subcontractor you may lose a lot of money on a construction project should you fail to have this notice in your contract.
If you are a contractor or subcontractor who does work on residential properties, you MUST have a contract with this notice placed at the end of it. This notice must be stated verbatim as it is defined in A.C.A. 18-44-115. And, this notice MUST be signed by the homeowner/client. It is important for you as a contractor or subcontractor to have an attorney familiar with construction law and construction contracts to protect your business interest and make sure you get paid for the work you complete for your clients. At WH Law, we have drafted several construction contracts and argued successfully when disputes arise out of any disagreements over the contracts or construction services performed by our clients. If you are a contractor who works without a contract or has an out of date contract, please give us a call today so that we can help protect you and your business.