Ashworth v. Bullock

Decision Date18 April 2013
Docket NumberNo. 20120278–CA.,20120278–CA.
Citation304 P.3d 74,732 Utah Adv. Rep. 5
PartiesSam ASHWORTH, Plaintiff and Appellant, v. Murph BULLOCK, Defendant and Appellee.
CourtUtah Court of Appeals

OPINION TEXT STARTS HERE

James H. Deans, for Appellant.

Sidney Balthasar Unrau, for Appellee.

Judge CAROLYN B. McHUGH authored this Opinion, in which Judges GREGORY K. ORME and J. FREDERIC VOROS JR. concurred.

Opinion

McHUGH, Judge:

¶ 1 Sam Ashworth appeals the trial court's declaratory judgment determining that Murph Bullock and his wife Cecelia Bullock (collectively, the Bullocks) are the owners of real property in Payson, Utah (the Property). We affirm.

BACKGROUND 1

¶ 2 In 1976, Joseph Bates and Rosemary Bates Harris, brother and sister, held the Property as joint tenants, with right of survivorship. The Bullocks were living in a home located on the Property pursuant to a verbal rental agreement with Bates. The Bullocks had never met Harris and were unaware that she held an ownership interest in the Property.

¶ 3 On October 15, 1976, Bates executed a written document (the Writing), which states,

I Joe Bates am selling my home.

at 346 [West] 300 [South] Payson[, U]tah.

To Murph and Cece Bullock

For $84,000[.]00 to be paid $200.00

a month until the year 2013.

where for it will be paid in full.

10/15/1976 /s/ Joe Bates

witness /s/ Woody Woodward

Bates read the Writing aloud to Murph Bullock, who is functionally illiterate, and then signed it. However, Harris never signed the Writing and neither the Bullocks nor Bates ever recorded the Writing or any other document indicating that the Bullocks claimed an interest in the Property. In May 1977, nearly seven months after Bates executed the Writing, Harris died.

¶ 4 The Bullocks still reside on the Property and have made the monthly payments specified in the Writing for over thirty years. The Bullocks have also contributed $800 each year to the property taxes. However, title to the Property remained in Bates's name and the Bullocks have never claimed a tax deduction related to the Property. The Bullocks have maintained renter's insurance on the residence rather than an owner's insurance policy, but they have made significant repairs and improvements to the Property.

¶ 5 When Bates died in October 2010, Ashworth was appointed as the personal representative of the estate. Assuming that the Property was part of the estate, Ashworth instructed a property manager to contact the Bullocks for the purpose of obtaining a written rental agreement. The Bullocks refused to enter into a rental agreement, instead claiming that they were purchasing the Property from Bates.

¶ 6 On May 2, 2011, Ashworth filed a complaint against Murph Bullock for unlawful detainer. Bullock responded with an answer and a motion to dismiss the complaint. At a hearing on the motion to dismiss, the parties stipulated that the motion be denied and that the matter be set for a bench trial. At trial, Ashworth indicated that the estate no longer sought eviction under the unlawful detainer statute. Instead, the estate requested a declaratory judgment “regarding the rights of the parties with respect to the Property.” The trial court ruled that Ashworth's motion was appropriate because the evidence at trial “focused on the issue of determining the nature of the agreement between Bates and the Bullocks.” Accordingly, the trial court conformed the pleadings to the evidence and rendered a declaratory judgment on the effect of the Writing.

¶ 7 The trial court first ruled that “Harris' signature was unquestionably necessary on the [Writing] when it was executed in 1976.” As a result, it determined that the Writing had not ripened into a contract at the time it was executed. However, the trial court also concluded that “upon Harris' death, the [Writing] ripened into what can be argued is an enforceable contract.” 2 Accordingly, the trial court ruled that the Bullocks had purchased the Property and that Ashworth was not entitled to relief under the unlawful detainer statute. Ashworth filed a timely appeal.

ISSUE AND STANDARD OF REVIEW

¶ 8 Ashworth argues that the Writing attempting to sell the Property to the Bullocks is void and unenforceable under the statute of frauds and therefore conveyed nothing to the Bullocks. “The applicability of the statute of frauds is a question of law to be reviewed for correctness.” Bennett v. Huish, 2007 UT App 19, ¶ 25, 155 P.3d 917 (citation and internal quotation marks omitted).

ANALYSIS

¶ 9 Ashworth agrees with the trial court that the Writing was void and unenforceable under the statute of frauds when executed by Bates. However, he contends that the trial court erred in concluding that the Writing ripened into an enforceable contract upon Harris's death. In order to resolve this issue, we must consider the effect of the Writing and Harris's death on the ownership of the Property.

I. The Writing Was Not an Enforceable Contract when Executed by Bates.

¶ 10 The trial court correctly noted that “Utah courts have, over the years, consistently determined that the Statute of Frauds requires the signature of both owners for the transfer of real property held in joint tenancy.” 3See, e.g., Krantz v. Holt, 819 P.2d 352, 353 (Utah 1991) (“If [ex-husband] retained a joint interest in the property, his written consent to the property's sale would be necessary, not because of any clause in the agreement, but because the Utah statute of frauds so requires.”); Williams v. Singleton, 723 P.2d 421, 423 (Utah 1986) (per curiam) (“One joint tenant or tenant in common cannot bind his cotenant by a contract which he may make relating to the common property.”); Centennial Inv. Co. v. Nuttall, 2007 UT App 321, ¶ 10, 171 P.3d 458 ([W]hen real property is held in joint tenancy, the signature of both owners is necessary to satisfy the Utah statute of frauds.”). In this case, Harris did not execute the Writing and therefore, no enforceable contract was formed in 1976. See Krantz, 819 P.2d at 353;Williams, 723 P.2d at 423;Centennial Inv., 2007 UT App 321, ¶ 10, 171 P.3d 458.

II. The Writing Did Not Sever the Joint Tenancy.

¶ 11 The status of the joint tenancy at the time of Harris's death is relevant because it determines who became the owner of Harris's interest in the Property. If the joint tenancy remained in effect at that time, Harris's interest passed by law to Bates. See generally Shiba v. Shiba, 2008 UT 33, ¶ 17, 186 P.3d 329 (holding that both parties to a joint tenancy “hold a concurrent ownership in the same property with a right of survivorship, i.e., each [tenant] is afforded the eventuality of a full ownership interest, conditioned upon the tenancy remaining unsevered, and one out-living the other” (citation and internal quotation marks omitted)); see also In re Estate of Ashton, 898 P.2d 824, 826 (Utah Ct.App.1995) (reversing the district court's inclusion of property in the deceased's estate that, at the time of his death, was held in joint tenancy with full right of survivorship). If, on the other hand, Bates's attempt to convey the Property to the Bullocks severed the joint tenancy, he and Harris held the Property as tenants in common at the time of Harris's death. SeeUtah Code Ann. § 57–1–5(5)(a) (LexisNexis Supp. 2012) ([I]f a joint tenant makes a bona fide conveyance of the joint tenant's interest in property held in joint tenancy to himself or herself or another, the joint tenancy is severed and converted into a tenancy in common.”). When a tenant in common dies, that tenant's interest in the property passes to her heirs, rather than to the other tenants in common. See Webster v. Lehmer, 742 P.2d 1203, 1205 (Utah 1987) (explaining that the deed created a tenancy in common, not a joint tenancy, and that therefore, “when [the tenant in common] died intestate in 1975, her interest, instead of passing solely to [the other tenant in common], passed by the rules of intestate succession to [the deceased tenant's] two daughters”). Thus, if the Writing severed the joint tenancy, it was converted to a tenancy in common and Harris's interest passed to her heirs. See Shiba, 2008 UT 33, ¶ 17, 186 P.3d 329.

¶ 12 When a joint tenant conveys “his interest therein by a valid deed,” he ‘severs and terminates the joint tenancy by the creation of a tenancy in common.’ Id. (quoting Tracy–Collins Trust Co. v. Goeltz, 5 Utah 2d 350, 301 P.2d 1086, 1090 (1956)). However, such a conveyance by valid deed does not convey the entire property because a joint tenant may not “dispose of more than his own interest in joint tenancy property, i.e., one-half thereof.” Id. (citation and internal quotation marks omitted); see also Johnson v. Bell, 666 P.2d 308, 312 (Utah 1983) (“A grantee under a quitclaim deed acquires only the interest of his grantor be that interest what it may.” (citation and internal quotation marks omitted)); Crowther v. Mower, 876 P.2d 876, 879–80 (Utah Ct.App.1994) (holding that a quitclaim deed of the mother's one-half interest in property severed the joint tenancy and created a tenancy in common). Here, Bates never executed a deed in favor of the Bullocks. In addition, Ashworth concedes that Bates's intent was to contract for the sale of the entire Property, not just his half interest in it. See In re Estate of Knickerbocker, 912 P.2d 969, 975 (Utah 1996) ([T]he key to determining whether a joint tenancy has been severed is the intent of the parties.”); Williams, 723 P.2d at 425 (holding that one joint tenant could not alone accept an offer to purchase property where the [buyers] offered to purchase the joint interest of the [sellers], and [one joint tenant] negotiated for the sale of the joint interest”); Centennial Inv., 2007 UT App 321, ¶ 12, 171 P.3d 458 ([B]oth parties agree that the negotiations were for the purchase of the joint interest of [the joint tenants].”).

¶ 13 The Writing in this case indicates that Bates purported to contract to sell the entire property, stating, “I Joe Bates am selling my home.” SeeUtah Code...

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