Plaintiff’s Award of Lost Profits Vacated For Failure to Present Evidence of Costs, But All Other Decisions Upheld

In Post and Beam Equity Group, LLC et al v. Sunne Village Development Property Owners Association, 2015 VT 60 (May 15, 2015), the Vermont Supreme Court vacated an award of lost profits, but upheld all other decisions by the trial court.

Issue: Defendant, a residential property owners’ association, appealed: 1) a judgment that it created a nuisance for Plaintiff, a commercial landowner due to its actions involving an easement; 2) the calculation of compensatory damages for that nuisance; and 3) the award of punitive damages and attorneys’ fees. Plaintiff cross-appealed the decision that its patrons cannot use its easement to access to its restaurants.

Holding: The Court reversed the award of compensatory damages for insufficient evidence, but affirmed on all other issues.

More Detail: The Court reversed the compensatory damages award because an award of lost profit is too speculative if it is based on lost revenue without any evidence of costs. The Court found sufficient evidence to uphold the nuisance judgment. It also upheld the punitive damages award, holding that there does not have to be personal animus for a punitive damages award, just “insulting or oppressive” conduct or “reckless or wanton disregard of another’s rights.”

Plaintiff amended the complaint mid-trial to include claims under fee shifting statutes. The Court refused to limit the attorneys’ fees to those incurred after the amended complaint because the case involved multiple legal theories based on a common core set of facts. Lastly, the Court found that the use of the easement by restaurant patrons was beyond the intended scope of the easement. While the easement did not explicitly exclude residential use, since all of the subdivision lots were originally residential, the Court found that the original parties intended for the easement to be limited to the normal vehicular and pedestrian use of a residential dwelling.