Key Points

  • The Third Department held that the Town of Gardiner, as fee owner of the Wallkill Valley Rail Trail, was a necessary party to third-party claims seeking adverse possession, an easement and a right of reentry against a conservation-easement holder.
  • By stipulating with the town to discontinue those claims with prejudice, the landowner and his successor released a necessary party, requiring dismissal of the third-party complaint for nonjoinder.
  • The stipulation of discontinuance with prejudice had the preclusive effect of a judgment on the merits and, under res judicata, barred the landowner's affirmative defenses, which he conceded rested on the same theories.
  • After supplemental briefing, the court held that the land trust's failure to sign the stipulation did not void it.
  • The town was not a necessary party to the land trust's own claims because it had assigned its claims against the landowner to the trust.

A New York appeals court ruled Thursday that a landowner who dropped his claims to part of the Wallkill Valley Rail Trail against the Town of Gardiner, which owns the trail, also lost his defenses to a land trust's lawsuit accusing him of clearing trees there. The court held that dismissing those claims with prejudice barred the same theories as defenses.

The Appellate Division, Third Department, ruled unanimously for the Wallkill Valley Land Trust Inc. in an opinion by Justice Pritzker, joined by Justices Clark, Ceresia, Mackey and Corcoran. The panel modified a May 29, 2025, order by Ulster County Supreme Court Justice Kevin Bryant and granted the trust partial summary judgment, dismissing the three affirmative defenses of defendant William Richards and the third-party complaint he and Tracey Bartels had filed.

The decision turned on a single stipulation of discontinuance, the agreement by which Richards and Bartels ended their third-party case against the town. Releasing the town, which the panel found was a necessary party to the property claims, required dismissal of those claims. The same agreement had the force of a judgment on the merits, which barred Richards from raising the identical theories as defenses in the trust's suit.

The trust, a not-for-profit conservation organization, holds a conservation easement, granted by the town in 2007, over the rail trail, a public park that runs more than 22 miles along a former railroad. The trust sued Richards alleging that beginning in or around March or April 2023 he "conducted excavation, tree-trimming and removal, land-clearing, and other work" at 56 Sand Hill Road and caused work to occur on the adjacent trail. It sued for tree destruction under RPAPL 861, trespass, negligence and interference with an easement, seeking treble damages and restoration of the land.

In 1868 a predecessor owner of the 10-acre Sand Hill Road property, which the trail bisects, conveyed the strip to the Wallkill Valley Railway Company, and a 1917 map identifies a "[f]arm [c]rossing" across the line. Embankments built beside the railbed form the two parcels in dispute. After the railway stopped operating in 1977, the owners of 56 Sand Hill Road took over maintaining the parcels. Richards' father bought the property in 1996, and Richards said he continued that maintenance.

Richards answered the suit with three affirmative defenses, each premised on his claimed property interest in portions of the trail. He and Bartels, to whom he conveyed the property soon after the suit began, then sued the trust and the town, seeking title to the parcels by adverse possession. They also claimed a permanent easement over the farm crossing under Railroad Law § 52 and a right of reentry under the 1868 deed.

Before discovery, Richards and Bartels moved for summary judgment, and the town cross-moved to dismiss the third-party complaint against it. Richards and Bartels then entered into a stipulation with the town discontinuing the third-party action against it with prejudice. The trust cross-moved, relying on that stipulation. Justice Bryant denied their motion and the trust's cross-motion without prejudice to renewal after discovery, finding the trust's res judicata and necessary-party arguments unpersuasive.

Justice Pritzker noted that the trust "does not own the rail trail but merely holds a conservation easement," so the town held the fee title. Any win for Richards and Bartels "would result in an additional property interest — whether fee ownership, an easement or right of reentry — encumbering the Town's fee ownership of the rail trail," the opinion said. Under RPAPL 1511 and CPLR 1001, that made the town a necessary party that had to be joined.

"However, by entering into the stipulation of discontinuance with prejudice with the Town, defendant and Bartels released a necessary party, requiring dismissal of the third-party complaint due to the nonjoinder of a necessary party," Justice Pritzker wrote.

The panel then turned to res judicata, a doctrine that, in the Court of Appeals language the panel quoted, "bars successive litigation based upon the same transaction or series of connected transactions" after a merits judgment against a party to the earlier case. Richards had conceded in his own court papers that "the remaining claims [after discontinuing against the Town] in the third-party complaint only serve to support [defendant's] affirmative defenses." Citing Second Department precedent, the court held that a "stipulation of discontinuance with prejudice has the same preclusive effect as a judgment on the merits."

Richards, the court added, had a "full and fair opportunity to litigate" his property claims against the town. Justice Bryant's decision and Richards' brief alluded to conversations about the discontinuance's effect on the trust's claims, but the panel declined to consider them because the record was "devoid of same."

The panel also rejected Richards' argument that the trust was collaterally estopped from claiming the town was a necessary party. The trust had not signed the stipulation, and the court found the record held no evidence that the trust had agreed to the discontinuance or that Richards had moved to vacate it. After oral argument, the court requested further briefing on whether the missing signature voided the stipulation from the start, and it held that it did not.

The court also held that the town was not a necessary party to the trust's own claims, because the town had assigned its claims against Richards to the trust. That assignment, the panel added, did not transfer ownership of the trail.

The trust was represented by William F. Demarest III of Rupp Pfalzgraf LLC. Richards and Bartels were represented by James Bacon of Stenger, Glass, Hagstrom, Lindars & Iuele, LLP.

The panel otherwise affirmed Justice Bryant's order, without costs, so the denial of Richards and Bartels' summary judgment motion, without prejudice to renewal after discovery, stands.