Ronald L. Jones Charitable Trust v. Penner, s. 106,690

Decision Date07 September 2012
Docket NumberNos. 106,690,106,691.,s. 106,690
Citation284 P.3d 375
PartiesRONALD L. JONES CHARITABLE TRUST, R.L. Jones, Trustee, Appellee, v. Fred C. SANDERS, Gloria J. Sanders, and Bahm Demolition, Inc., Appellees, v. Jerry L. Penner, Sr., Intervenor/Appellant.
CourtKansas Court of Appeals

OPINION TEXT STARTS HERE

Appeal from Shawnee District Court; Larry D. Hendricks, Judge.

Christopher W. Sook, of Sloan, Eisenbarth, Glassman, McEntire & Jarboe, L.L.C., of Topeka, for appellants.

Stephen P. Weir, of Stephen P. Weir, P.A., of Topeka, for appellees Fred C. Sanders, Gloria J. Sanders, and Bahm Demolition.

Joe Little, of Auburn, for appellee Ronald L. Jones Charitable Trust, R.L. Jones, Trustee.

Before PIERRON, P.J., BUSER and LEBEN, JJ.

MEMORANDUM OPINION

LEBEN, J.

This case involves four main parties, two lawsuits, one piece of land, and three claimed agreements to transfer that land. We'll start with a quick tour of the basic facts, the legal disputes over this piece of real estate, and our resolution of those disputes.

In 2006, Ronald Jones, as trustee for his trust, entered a contract to sell the property to Jerry Penner. But Fred Sanders (on behalf of himself and his wife) then filed an affidavit of equitable ownerships—based on an earlier 2002 contract with Jones. And Bahm Demolition, Inc., which claimed rights to the property under a contract to buy it from the Sanderses, filed a mechanic's lien against the property, claiming that Bahm Demolition had done work on the property. Those filings effectively prevented Jones from transferring the property to Penner since Jones no longer had clear title to it.

Jones filed an action for quiet title, i.e., a ruling that he, not the Sanderses or Bahm Demolition, had proper title to the land; Jones' suit also brought intentional-tort claims against the Sanderses and Bahm Demolition. Penner intervened in the lawsuit, seeking specific performance of his 2006 contract to buy the property and alleging his own tort claims against the Sanderses and Bahm Demolition. The Sanderses and Bahm Demolition filed counterclaims against Jones and Penner. In 2007, the district court granted summary judgment against all of the parties' tort claims and against Jones' claim for quiet title.

In 2008, after a settlement conference with all parties except Penner (whose tort claims had been dismissed), a mediator reported that a settlement agreement had been reached for Jones to sell the property to Bahm Demolition. Two days later, Penner filed a separate lawsuit seeking injunctive relief to prevent that sale and to order specific performance of his 2006 contract with Jones. In 2011, the district court ordered that the settlement agreement be enforced, lifted a temporary restraining order that prevented sales to anyone other than Penner, and dismissed Penner's lawsuit.

On appeal, Penner and Jones argue that the district court erred by its 2011 ruling enforcing the settlement agreement and by its 2007 ruling eliminating their tort claims. Jones argues that there was no meeting of the minds for a settlement, and Penner argues that the settlement agreement isn't enforceable because it wasn't in writing. Jones and Penner argue that granting summary judgment on their tort claims and Jones' claim for quiet title was premature because questions of material fact remained. Penner also argues that the district court erred by denying his motion for default judgment seeking specific performance against Jones because Jones had never filed a written answer to the petition.

We will briefly summarize our rulings, which are explained later in the opinion:

The district court erred by ordering enforcement of the settlement agreement because a settlement agreement that includes an interest in land must be in writing to be enforceable under the statute of frauds.

The district court erred in eliminating some of the tort claims because there were questions of fact remaining for a jury. There was evidence in the record, when viewed in the light most favorable to Penner and Jones, that could lead a reasonable juror to find in their favor on their claims for tortious interference with a contract and on Jones' claim for slander of title against the Sanderses and Bahm Demolition.

• Jones' claim for quiet title also should be reinstated because questions of fact remain to determine who has valid interests in the property.

The district court didn't err by denying Penner's motion for default judgment because it was reasonable to wait to sort out the various claims to this property before granting the relief Penner's suit sought—specific performance requiring sale of the property to him.

We therefore reverse the district court's order to enforce the settlement agreement; the district court's grant of summary judgment on Jones' action for quiet title, his claims of tortious interference with a contract against the Sanderses and Bahm Demolition, and his claim of slander of title against the Sanderses and Bahm Demolition; and the district court's granting of summary judgment on Penner's claims for tortious interference with a contract against the Sanderses and Bahm. We affirm the granting of summary judgment for other tort claims and the district court's denial of Penner's motion for default judgment.

Factual Background

In 2002, Ronald Jones, as trustee for the Ronald L. Jones Charitable Trust, entered into a written contract with Fred and Gloria Sanders for the sale of one tract of commercial real estate located in Topeka. The contract provided that the transaction must be closed on or before November 5, 2002. One copy of the contract incorporated a handwritten Schedule B, which set out the purchase price and some conditions of the purchase. Those conditions provided that Fred Sanders would first find a renter and then pay $15,000 down, $500 a month for 36 months, and a balloon payment of $15,000 at the end for a total of $48,000. The Sanderses report that they entered into a contract to sell the property to Bahm Demolition, Inc. in 2005.

On February 27, 2006, Jones entered into another contract with Jerry Penner to sell the same property for $70,000. The next day, Fred Sanders came to Jones with a $50,000 check saying that he wanted to complete the sale agreed to in the 2002 contract. Jones declined to accept the check; he said that the 2002 contract had terminated because the sale from Jones to the Sanderses wasn't closed on November 5, 2002.

On March 2, 2006, Fred Sanders filed an affidavit of equitable interest in the property. On March 15, 2006, Bahm Demolition filed a mechanic's lien on the property. Those documents represented public claims of an interest in the real estate, effectively preventing transfer with a clear title.

In May 2006, Jones filed suit against the Sanderses and Bahm Demolition (case No. 06–C–777), seeking to quiet title ( i.e., to obtain a ruling that he has clear title and the Sanderses and Bahm Demolition had no valid interests) and alleging slander of title and tortious interference with his 2006 contract with Penner. Penner intervened, also alleging tortious interference with the real-estate sales contract against the Sanderses and Bahm Demolition. The Sanderses and Bahm Demolition filed counterclaims seeking a declaratory judgment affirming their interests and granting specific performance of the 2002 contract; they also asserted various tort claims.

In April 2007, the district court granted summary judgment against all of the tort claims, which included claims of tortious interference with a contract, slander of title, conspiracy to slander title, intentional infliction of emotional distress, tortious interference with a prospective business advantage or relationship, civil conspiracy, and misrepresentation (fraud). The district court also granted summary judgment in favor of the Sanderses and Bahm Demolition on Jones' quiet-title claim. The district court denied motions for summary judgment by Jones and Bahm Demolition on their underlying claims to the real estate and denied Jones' motion to amend his petition to include a claim for punitive damages. In July 2007, the district court permitted the Sanderses to amend their petition to change the claim for specific performance to a claim for breach of contract. In January 2008, the district court made a journal entry to clarify that Penner was dismissed as a party because all of his claims had been eliminated by the April 2007 order.

In April 2008, the three remaining parties participated in a settlement conference, after which the mediator—another district court judge—informed the district court through a docket entry that the case had been settled. Two days later, Penner filed a new lawsuit (case No. 08–C–550), seeking specific performance of the 2006 contract and injunctive relief against Jones to prevent the sale of the property to Bahm Demolition as the result of the settlement conference. Two weeks later, the district court issued a temporary restraining order to prevent Jones from selling the property.

The result of the 2008 settlement conference was never put down in a written document that all parties could agree upon. Instead, the parties exchanged correspondence disagreeing about the terms of their purported agreement. In March 2011, the district court granted a motion by the Sanderses and Bahm Demolition to enforce the settlement agreement and ordering that the property be sold to Bahm Demolition. The district court concluded that there was an enforceable settlement agreement and that the mediator could testify about the terms of the agreement.

In June 2011, Penner moved for default judgment against Jones, in case No. 08–C–550, a suit in which only Penner and Jones were parties. Penner sought specific performance of the 2006 contract, which would result in the property being sold to Penner, not Bahm Demolition.

On July 13, 2011, the district court lifted the temporary restraining order, denied Penner's motion for default judgment, and dismissed Penner's...

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