By Margaret Magnus & Sam Ervin
BOUNDARY CORNERSTONE QUESTIONED BY AVATAR MEHER BABA
When Avatar Meher Baba walked the Meher Mount property with Agnes Baron in 1956, He asked about Meher Mount's boundaries. Standing with Agnes near Baba’s Tree, He was particularly inquisitive about the southeast boundary corner post. Caretaker Agnes Baron indicated to Meher Baba that she was not sure about the location.
Pointing at a rocky, rugged, nearly vertical, canyon, she said, “I don’t know, Baba. It is down in that canyon somewhere.” Telling this story, she remembered that Meher Baba looked playfully put out with her. Over the ensuing years, she often remarked, “I wonder why Baba cared about that corner post.”
Almost 50 years later as part of Meher Mount’s long-range planning, a boundary survey and aerial topographic map of Meher Mount were commissioned. Volunteer architect Byron Pinckert had recommended the surveys would be needed for comprehensive planning for the property as well as for specific buildings that might be constructed. On March 31, 2008, Ventura County formally recorded Meher Mount’s boundary survey.
FENCE LINE ENCROACHES ON MEHER MOUNT PROPERTY
In the process, Meher Mount discovered that the property of the neighbors to the south, Larry and Maj Hagman, encroached on Meher Mount's land with footings for their solar panels, a couple of other small structures and a road. The fence line was actually on Meher Mount’s property.
Interestingly, that boundary line starts from the very corner Meher Baba inquired about.
LOOKING FOR A MUTUALLY AGREEABLE SOLUTION
In 2008, Meher Mount approached these neighbors looking for a mutually satisfactory way to address this issue. Meher Mount commissioned a second, detailed survey of that boundary line which showed the use of Meher Mount’s land by the Hagmans.
Meher Mount had several discussions and presented a number of proposals which were rejected by the property owners with no counterproposals ever made. The discussions stalled. Finally, Meher Mount decided to take no further action regarding the boundary until the Hagmans showed some interest in negotiating.
After more than a year, the Hagmans’ attorney contacted Meher Mount to say they wanted to settle the matter. The attorney sent Meher Mount a draft concept for a purchase of the .44 acre in question, and Meher Mount responded that we were interested in pursuing this suggestion.
Instead of following up as expected, the attorney then sent Meher Mount a notice that they felt they could just take the property at no cost except legal fees by making a legal filing for adverse possession.
THE HAGMAN TRUST FILES FOR ADVERSE POSSESSION
In March 2011, the Larry & Maj Hagman Trust sued Meher Mount for adverse possession of the .44 acres in contention.
Adverse possession is a method, rooted in common law, of obtaining title to land through use as long as certain requirements are met, and the adverse possessor is in possession for a sufficient period of time, as defined by a statute of limitations.
To obtain adverse possession in California, the party seeking to gain title to the property must demonstrate:
- Possession under a claim or right or color title
- Actual, open, notorious occupations such as protected by a substantial enclosure such as a fence and usually cultivated or improved
- Adverse and hostile possession
- Continuous possession for a period of five years
- Payment of all taxes assessed against the property during the five-year period 
In the Meher Mount case, much of the discussion centered around the issue of payment of property taxes by the Hagman Trust. Because Meher Mount is exempt from property taxes, the Hagman Trust argued that no taxes were required to paid by the Hagman Trust.
Meher Mount argued that there had been special assessments which were paid by Meher Mount and not the Hagman Trust. The arguments before the court then centered around whether or not a special assessment was a tax.
Meher Mount also argued that because of Meher Mount’s property tax exemption and status as a property set aside for public benefit, it was entitled to special protection from adverse possession by a private individual or concern.
FIRST RULING FAVORS THE HAGMAN TRUST
In November 2011, the Superior Court of California, Ventura County ruled in favor of the Hagman Trust.
Meher Mount appealed that decision to the California Court of Appeals, which heard oral arguments in January 2013. The California Board of Realtors also filed an amicus brief and argued in support of Meher Mount's position.
A SETTLEMENT IS AGREED UPON
Before the ruling by the Appellate Court, the Hagman Trust came to Meher Mount with a reasonable settlement offer that allowed them to retain the half acre. Their attorney noted that Larry Hagman had recently died, which changed the picture for the Hagman Trust, and that they recognized Meher Mount’s cooperation would be required to secure a timely lot line adjustment.
The proposed agreement also included a small area of the Meher Mount property that had not been included in the original lawsuit, but was part of the Hagman driveway, next to Meher Mount’s entry.
The agreement was signed in February 2013. It included the stipulation that it would be unaffected by the decision by the Appellate Court, which later ruled in favor of the Hagman Trust.
The resulting agreement, made some five years after the first discussions between Meher Mount and the Hagmans, cost the Hagman Trust far more than a negotiated settlement based on Meher Mount’s first proposal to them in 2008 would have cost. Stephen M. Sanders, Esq. represented Meher Mount and helped to reach a workable settlement.
IS PRECEDENT SET?
The Courts did not address the issue of the vulnerability of non-profit organizations whose land is tax-exempt from being subjected to future adverse possession claims without paying property taxes.
“Meher Mount argued that establishing this rule will make it easier to adversely possess the property of tax exempt corporations, and that the tax exemption is meant to benefit the public-minded property owner but here excuses the adverse possessor from paying the statutory duty to pay taxes. The court said that may be, but it was not free to choose when faced with statutes that controlled the decision.” 
Writing about the decision, an observer noted, “This decision makes sense, because the court closely followed the statute as it was required to do. However, it should ring a bell for all tax-exempted land owners, because now it is a little bit easier to adversely possess their property, and sophisticated neighbors will figure this out. The tax-exempt land owner must be more vigilant about its real estate now.” 
 “Hot to Get a Property Through Adverse Possession in California,” by Melissa C. Marsh, attorney, October 2010.
 “California adverse possession of property owned by tax exempt organizations is easier – property taxes do not need to be paid,” by Law Office of James J. Falcone, August 8, 2013, California Real Estate Lawyers Blog.
MORE ON THE LAWSUIT
- "Don't Fence Me In: Larry Hagman and Adverse Possession," by Robyn Cain for FindLaw on April 4, 2013.
- “Nonprofit Loses Bit of Land to Larry Hagman,” Courthouse News Service, April 5, 2013.
- “Maj Hagman v. Meher Mount Corporation, Defendant and Appellant,” FindLaw, 2nd Civil No. B239014, Decided: April 3, 2013.
- “Hagman v. Meher Mount Corporation – an expansion of adverse possession?” by Gregory Nerland, Attorney at Law, Walnut Creek, CA.
- “Non-Profits Need to be More Diligent to Prevent Adverse Possession Claims,” by Charles S. Bronitsky, May 13, 2013, Law Offices of Peter N. Brewer, Palo Alto, CA.
- “Adverse Possession Awarded without Paying Taxes,” by Simon Offord, April 23, 2013, Law Offices of Peter N. Brewer, Palo Alto, CA.
- “Adverse Possession Just Got Easier,” by Michael Chung, April 5, 2013, LO-MC, Law Office of Michael Chung, Los Angeles, CA.
- “California adverse possession of property owned by tax exempt organizations is easier – property taxes do not need to be paid,” by Law Office of James J. Falcone, August 8, 2013, California Real Estate Lawyers Blog.