Shepard v. Purvine

Oregon Supreme Court · Property

PropertyLicenseEasementsWater rightsEstoppelparol licenseirrevocable licenseestoppel

Facts

Plaintiffs owned adjoining land with poor well water for domestic use and sought to pipe water from a spring on C. M. Purvine's land. Plaintiffs and defendants agreed that C. M. Purvine orally permitted plaintiffs to use the spring water and construct a pipeline, but disputed whether that permission was permanent or only temporary. Plaintiffs filed an application with the state engineer in February 1944, then openly spent more than $700 installing about 2,200 feet of pipe and connecting the system permanently to their buildings, and continuously used only a small portion of the spring flow. After C. M. Purvine's death, defendants attempted to treat the permission as revocable.

Issue

Whether the oral agreement between plaintiffs and C. M. Purvine granted only a temporary, revocable license or instead granted a permanent license that became irrevocable when plaintiffs made permanent and valuable improvements in reliance on it.

Rule

In Oregon, although a parol license to use land ordinarily creates no interest in land, it becomes irrevocable if the licensee, in reliance on the license, makes permanent and valuable improvements. Whether the license was intended to be permanent or temporary is determined from the facts and circumstances, and if permanence is shown and reliance expenditures were made, the licensor and successors are estopped to deny the right.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

In rural Salem, Oregon, Nora Bennett asked her neighbor, Dale Mercer, for permission to bury a water line across his pasture from an unused spring on his land to her farmhouse. Dale orally agreed, and Nora promptly spent $18,000 installing buried pipe, a pump house, and permanent interior plumbing connections to two buildings on her property.

Three years later, after Dale sold the pasture to Ivy Sloan, Ivy orders Nora to remove the line, arguing that oral permission to use land is always revocable. Under the majority rule applied in Oregon, who is likely to prevail?

Explanation. The majority opinion states that in Oregon a parol license, though ordinarily revocable, becomes irrevocable when the licensee, relying on it, makes permanent and valuable improvements. The opinion also holds that successors in interest are estopped to deny the right once those elements are shown. Nora’s substantial buried line and permanent plumbing connections strongly support an irrevocable license.