Andres v. Claassen
| Decision Date | 21 February 1986 |
| Docket Number | No. 57787,57787 |
| Parties | Orlando L. ANDRES, a single man; Doris R. Andres, a single woman; Willis G. Andres and Martha Lucille Andres, husband and wife; Plaintiffs-Appellees, and Cross-Appellants, v. Roland L. CLAASSEN, Defendant-Appellant, v. Donald D. DANNAR and Mary B. Dannar; husband and wife, Third-Party Defendants, and Kansas Department of Transportation of the State of Kansas, Third-Party Defendant-Appellee. |
| Court | Kansas Supreme Court |
Syllabus by the Court
1. A written instrument may be reformed where there is ignorance or a mistake on one side and fraud or inequitable conduct on the other, as where one party to an instrument has made a mistake and the other knows it and fails to inform him of the mistake or conceals the truth from him.
2. Actual fraud is an intentional fraud, and the intent to deceive is an essential element thereof. Constructive fraud is a breach of a legal or equitable duty which, irrespective of the moral guilt, the law declares fraudulent because of its tendency to deceive others or violate a confidence, and neither actual dishonesty of purpose or intent to deceive is necessary
Michael S. Sizemore, of Speir, Stroberg & Sizemore, Newton, argued the cause, and was on briefs, for defendant-appellant.
Richard V. Foote, of Matlack & Foote, P.A., Wichita, argued the cause, and Arnold C. Nye, of Nye & Nye, Newton, was with him on brief, for plaintiffs-appellees and cross-appellants.
Lisa E. Schwinn, of the Kansas Dept. of Transp., argued the cause, and Michael B. Rees, Chief Counsel, was with her on brief, for third-party defendant-appellee Kansas Dept. of Transp.
This is an action brought by the sellers of real estate against the buyer for the construction and reformation of certain deeds and for the recovery of actual and punitive damages for alleged misrepresentation and fraud on the part of the defendant/buyer. The plaintiffs/sellers are the members of the Andres family. The defendant/buyer isRoland L. Claassen. In the course of the proceedings, the buyer filed a third-party petition against Donald D. Dannar and his wife, Mary B. Dannar, and against the Kansas Department of Transportation (KDOT) to quiet his title to certain land which the buyer contended was included in the purchase of real estate from the Andres family.
The case was tried to the court as a proceeding in equity. The trial court held in favor of the plaintiffs on their petition, granting reformation of the deeds but denying recovery of damages on the plaintiffs' claim of fraud. The buyer appealed and the sellers cross-appealed.
The facts in the case were not greatly in dispute. The trial court made comprehensive findings of fact and conclusions of law. The factual situation may be summarized as follows: The plaintiffs, the Andres family, for a number of years had been the owners of real estate located in the city of Newton in the NW 1/4 of Section 28, Township 23 South, Range 1 East in Harvey County. The land is bordered on the west by what is known locally as old U.S. Highway 81 and on the east by I-135. The property was located with such close proximity to old U.S. Highway 81 and the new I-135 that it was in time subjected to five separate condemnation actions after old U.S. Highway 81 was expanded from a two-lane highway to a four-lane highway. After these various condemnation actions and a private sale to an individual, the Andres family owned the fee interest in a small frontage property located to the north of U.S. Highway 50, and along old U.S. Highway 81. This tract will be referred to in the course of the opinion as the "frontage property." The defendant Claassen was the owner of a lumber yard immediately east of this frontage property. Claassen had previously purchased this lumber yard property from the Andres family prior to 1972.
In addition to the frontage property, the plaintiffs owned a reversionary interest in a tract of land of about 44 acres lying south of Highway 50, which had been acquired by KDOT in the eminent domain proceedings mentioned heretofore. It is this 44-acre tract which is the subject of dispute in this litigation.
For a number of years prior to February 1979, the plaintiffs had attempted to sell the frontage property to the defendant, Roland D. Claassen. Attempts to sell the property occurred in 1970, 1972, and 1974. In 1974, the defendant made a written offer to purchase the frontage property, but the parties could not reach an agreement. In February 1979, the negotiations for sale of the frontage property occurred which brought about the present litigation. The plaintiffs listed the frontage property with a realtor, Jim Klaassen, with instructions to sell it for $90,400 to whomever wished to buy it. The realtor made numerous attempts to sell the property to the defendant, Roland D. Claassen. The defendant's response was that the asking price was too much money. At no time did the defendant and the real estate agent discuss the sale of any real estate other than the frontage property lying north of Highway 50. During the month of July 1979, the defendant told the real estate agent that he would make an offer to purchase the property for the sum of $87,500, and told the real estate agent to prepare the contract. A contract describing the frontage property was prepared and delivered to defendant, who advised the real estate agent that he wished to have his attorney examine the same and took the contract to him for that purpose.
When the defendant Claassen returned the contract to the real estate agent, he had made several minor changes therein not material in this case and, in addition, the following language was added to the description of the land to be sold:
"This proposal includes all land owned by sellers in above NW 1/4, whether described herein or not."
At no time did the defendant make it known to the real estate agent or to the plaintiffs that the added language was to increase the quantity of real estate being sold by including the plaintiffs' reversionary interest in the 44-acre tract lying south of Highway 50. The attorney's suggested language used the words "including any reversion," but that language was changed to "and improvements thereon" when the contract was rewritten and retyped.
At no time did the defendant advise the real estate agent that the quantity of land had been increased. The real estate agent discussed the additional language with the defendant and concluded that the change in language was to clarify the existing description. The real estate agent then took the revised contract to the plaintiffs, who signed the same. Prior to signing the revised contract, the plaintiffs discussed the added language with the real estate agent, who informed them that it was for the purpose of clearing up any misdescription in the property to be conveyed.
The trial court found that, at the time of the execution of the contract, plaintiffs owned no other land in the Northwest Quarter, but did have the possibility of a reverter in the 44 acres which had been condemned by the state of Kansas in the various condemnation cases. The plaintiffs did not understand the extent or nature of their actual rights in the 44 acres but believed that the Highway Department at some time in the future might reconvey the land to them. The plaintiffs did not understand that their "rights" amounted to the ownership of "land."
On November 28, 1979, the real estate transaction was closed, and plaintiffs delivered to the defendant two warranty deeds which had been prepared at the direction of defendant or his attorney. One deed contained in the description clause the following language:
"Together with any and all right, title or interest, present or contingent in the Northwest Quarter (NW 1/4) of Section 28, Township 23 South, Range 1 East of the 6th P.M."
The trial court found that it was not the intention of the plaintiffs to convey any interest in the possible reversionary rights in the 44-acre tract lying south of Highway 50 which had been taken for highway purposes. The defendant Claassen testified it was his intent that the language include the reversionary interest south of the highway and that is the reason why the additional language was added by his attorney in the disputed contract and deed.
The trial court found that at no time in any of the negotiations for the purchase of the frontage property down through the years did the defendant make known that it was his intention to include the reversionary interest in the land lying south of the highway. At no time in the negotiations with the real estate agent, Jim Klaassen, that culminated in the sale did the defendant make his intentions known. The trial court found that the land lying south of Highway 50 was never a part of the negotiations between the parties and that plaintiffs listed for sale only the frontage property north of Highway 50 with the realtor. This land was the land the realtor knew was for sale and which he discussed with the defendant at numerous times and which the defendant purchased. The trial court concluded that it was the intent of the parties at this stage of the negotiations that the plaintiffs intended to sell and the defendant intended to buy only the frontage property. Only the price was yet to be negotiated. The plaintiffs offered to sell the frontage land for $90,400. The defendant offered to buy for $87,500.
Defendant Claassen testified, in substance, that in all negotiations he knew that the realtor had for sale the frontage property and that he never mentioned the reversionary rights of the Andres family in the 44 acre highway tract. He testified that he had many opportunities to mention to the realtor that it was his intent to purchase not only the frontage property but the rights of the Andres family in the highway property to the south but he never discussed it. His explanation was that he "didn't feel it was necessary"...
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