Bowyer v. Reinhardt
| Decision Date | 14 July 2022 |
| Docket Number | s. 20-CV-0442 & 20-CV-569 |
| Citation | 277 A.3d 1259 |
| Parties | Matthew BOWYER, Appellant, v. Phillip B. REINHARDT, Appellee. |
| Court | D.C. Court of Appeals |
Gwynne L. Booth, with whom Richard W. Luchs was on the brief, Washington, for appellant.
Richard J. Bianco, with whom Nicholas Loch was on the brief, for appellee.
Before Glickman and McLeese, Associate Judges, and Ferren, Senior Judge.
In April 2015, appellant Matthew Bowyer entered into a contract to purchase a housing accommodation (the Property) and received a valid assignment of each tenant's right of first refusal to purchase ("offer of sale") pursuant to the Tenant Opportunity to Purchase Act (TOPA).1
The seller failed to convey, and Bowyer sued. After the Superior Court granted Bowyer an order for specific performance in April 2016, the court-appointed trustee authorized to sell the Property to Bowyer nonetheless reissued TOPA offers of sale to all the current tenants. Appellee Phillip Reinhardt, a tenant who had previously assigned his TOPA rights to Bowyer, responded to the second TOPA offer by submitting a "statement of interest" in purchasing the Property. Bowyer contested Reinhardt's right to proceed and reopened the litigation. Reinhardt filed a counterclaim, and the cases were consolidated.
The trial court ruled that the initial assignment of TOPA rights expired upon the reissuance and denied Bowyer's motions for summary judgment (1) seeking declaratory relief that he was the only person entitled to purchase the Property and, alternatively, (2) requesting a stay pending his receipt of another TOPA offer reflecting the tenants’ assignments to Bowyer from the first offer of sale. The court then granted Reinhardt's motion for summary judgment for specific performance, ultimately ordering the trustee to convey the Property to Reinhardt on behalf of the seller. Bowyer argues on appeal that the trial court erred in each of these rulings. We agree; for reasons elaborated below, we reverse the rulings of the trial court, and conclude that Bowyer alone is entitled to purchase the Property.
On April 4, 2015, appellant Bowyer entered into a contract to purchase the Property from Viktor Sidabras. The designated settlement agent was L.P. Title, LLC, a company affiliated with a law firm, Arness & Associates, PLLC. In accordance with TOPA,2 notices inviting offers of sale (TOPA offers) were sent to Property tenants Paul Hamill, Steven Laye, and Phillip Reinhardt on April 10, 2015. The notices listed Lane Potkin of Arness & Associates, PLLC as the owner's agent, and Jaclyn Williamowsky – an attorney with both the Arness firm and L.P. Title, LLC – as the contact. Each tenant assigned his "right to purchase the Property and the right attached to the TOPA Notice" to Bowyer within the next month.3 The assignment agreements read:
[In] accordance with [TOPA], ... Owner [Sidabras] provided Assignor [Hamill/Laye/Reinhardt] an Offer of Sale & Tenant Opportunity to Purchase With a Third Party Sale Contract ... dated April 10, 2015 ("the TOPA Notice"); ... Assignor now wishes to assign the right to purchase the Property and the right attached to the TOPA Notice (the "TOPA Rights") to Assignee [Bowyer] in consideration for [rent concessions and improvements to the property paid for by Assignee]; ... Assignor hereby assigns and transfers to Assignee all of Assignor's TOPA Rights. Assignee hereby assumes all of Assignor's TOPA Rights. The TOPA Rights are hereby assigned in accordance with the terms hereof.
In return, Bowyer would extend the assignors’ leases through September 30, 2017, for $3,750 per month, with rent increasing the same amount as real property taxes beginning in January 2016. Bowyer would also make various repairs to the Property "within 60 days of settlement."
Sidabras, however, refused to convey the Property, and Bowyer filed suit on June 22, 2015. Bowyer was represented by John Arness, a partner at the same firm as Williamowsky and Potkin. Bowyer moved for entry of summary judgment on January 22, 2016, requesting specific performance from Sidabras and a court-appointed trustee to convey the Property. L.P. Title, LLC would again be the settlement agent. Before the court's decision, Williamowsky contacted the First American Title Insurance Company on April 5, 2016, to ask whether TOPA notices would have to be sent out again. That same day, the title company answered that, as more than 180 days had passed since the first TOPA offers had been sent out, the process would have to start over.4 Williamowsky relayed this to Bowyer and the trustee, advising them that a second round of TOPA offers was necessary to ensure clear title to the Property. Bowyer did not object.
Bowyer's motion for summary judgment ordering specific performance was granted on April 27, 2016. By this point, one of the original tenants, Laye, had moved out, and James Reeves had taken his place. On May 13, 2016, Bowyer emailed the tenants in order to facilitate new assignments of their TOPA rights:
The second TOPA notices were sent to Reinhardt, Hamill, and Reeves on June 1, 2016. Williamowsky was listed as both the contact and the owner's agent. By this time, she had become a named partner at her firm, now called Arness, Potkin, & Williamowsky, PLLC.
On June 20, 2016, Reeves accepted the TOPA offer, as did Reinhardt on June 21, 2016. Bowyer objected, and Williamowsky sent the same letter to Reeves and Reinhardt on July 6, 2016, which read:
Williamowsky signed the letter.
On August 15, 2016, Reeves assigned his TOPA rights to Reinhardt. On September 29, 2016, again represented by John Arness, Bowyer filed a motion to reopen the case, seeking declaratory relief that he was the only one entitled to purchase the Property. The next day, Reinhardt filed a complaint against Bowyer, seeking specific performance (Count I) and alleging breach of contract for Bowyer's refusal to convey the Property (Count II). The cases were consolidated.
Bowyer filed for summary judgment on February 17, 2017, arguing that the tenants "irrevocably contracted to assign all of their rights to purchase the property under TOPA" to him in April 2015, "including the right of first refusal," and so he was still "the assignee of all tenant rights existing under the Act." Judge Campbell denied the motion on August 29, 2017, stating:
Unhappily for Mr. Bowyer, the fact is that he acquiesced in a re-issuing of TOPA notices after the Court's April 2016 order granting him a right to purchase. The Court is unable to conclude, on these facts, that the new notices had no legal effect at all, and were no more than some kind of meaningless charade performed in order to make the title company happy. The notices were in the proper form, and explicitly gave the recipients (including Mr. Reinhardt) the right to purchase the property. On this motion, the Court cannot credit the argument that they had no actual meaning and conveyed no actual rights. Notably, Mr. Bowyer voluntarily caused the notices to be reissued. He did not have to comply with the title company's demand, and instead, for example, could have petitioned this Court for a declaration that TOPA rights had already been satisfied.
John Arness and the firm Arness, Potkin, & Williamowsky, PLLC withdrew as Bowyer's counsel on October 17, 2017, and Gwynne L. Booth, who was not affiliated with the Arness firm, took over as counsel.
Bowyer filed a second motion for summary judgment on October 25, 2017, arguing that even if he was not entitled to relief under the April 27, 2016, order for specific performance, the second TOPA offers had not been properly executed, as Bowyer should have received one as the assignee of...
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