Biales v. Young, 23881
| Court | United States State Supreme Court of South Carolina |
| Writing for the Court | TOAL; HARWELL |
| Citation | 315 S.C. 166,432 S.E.2d 482 |
| Parties | James R. BIALES, Appellant, v. William F. YOUNG, II, Robert H. Gwin, III, and Virginia Property Enterprises and Consultants, Inc., Defendants, of whom Robert H. Gwin, III, is Respondent. . Heard |
| Docket Number | No. 23881,23881 |
| Decision Date | 04 May 1993 |
Page 482
v.
William F. YOUNG, II, Robert H. Gwin, III, and Virginia
Property Enterprises and Consultants, Inc., Defendants,
of whom Robert H. Gwin, III, is Respondent.
Decided June 21, 1993.
Page 483
H. Buck Cutts, of Cutts Law Office, Surfside Beach, for appellant.
Susan Taylor Wall, of Holmes & Thomson, Charleston, for respondent.
TOAL, Justice:
The purchaser of an interest in some resort property brought this action against the seller's attorney alleging the [315 S.C. 167] attorney breached his duties as escrow agent and violated state securities law. The trial court granted the attorney's motion for summary judgment on both causes of action. We affirm.
Virginia Property Enterprises and Consultants, Inc. (hereinafter "Virginia Property") owned twelve condominium units located at Reflections Resort in Garden City. William Young, the President of Virginia Property, negotiated a loan of $275,000 from Jim Biales, the plaintiff in this action. The loan was secured by a promissory note and a second mortgage on the units in Garden City. Biales was also to receive two percent equity participation in Litchfield Plantation once it was purchased by Virginia Property. Attorney Gwin, the defendant in this action, represented Young and Virginia Property. Biales was represented by his own attorney.
Biales and Young executed an escrow agreement which provided that proceeds of the loan were to be held in escrow for the purchase of Litchfield Plantation. Gwin was to act as escrow agent for the transaction. However, the copy of the agreement held by Gwin, which admittedly was signed only by Young, did not include this escrow condition. Gwin denies knowledge of the condition that the money be held for this purpose. Rather, Gwin believed the loan proceeds were to be disbursed directly to Virginia Property.
After receiving the loan amount, Gwin wrote to Biales' attorney twice outlining the disbursement procedure as he believed it to be pursuant to the version of the Young and Biales' agreement which had been supplied to Gwin. Gwin attached a copy of this agreement, providing for disbursement to Virginia Property, to his letters to Biales' attorney. The letters urged Biales' attorney to respond within a specified time if the procedure outlined was not acceptable to Biales. Neither Biales nor his attorney responded. Accordingly, once the other escrow conditions were met, Gwin disbursed the money directly to Virginia Property. Virginia Property never purchased Litchfield Plantation but used the money in part to cure the default of its first mortgage. Virginia Property did not pay on the note to Biales when it became due and eventually filed for bankruptcy.
[315 S.C. 168] Biales brought this action against Gwin alleging Gwin negligently breached his fiduciary duty as an escrow agent and violated
Page 484
South Carolina Uniform Securities Act. Gwin moved for summary judgment, which was granted on both causes of action. The trial court granted Gwin's motion for summary judgment on the breach of fiduciary duty cause of action on the grounds that Biales had waived and ratified the breach of the escrow agreement and was further estopped from asserting the existence of a breach. The trial court granted summary judgment on the securities cause of action, finding that Gwin was not a seller under the South Carolina Uniform Securities Act. Biales appeals....To continue reading
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