Brimley v. Gasser, 870154-CA

• Decision Date: 13 May 1988
• Docket Number: No. 870154-CA,870154-CA
• Parties: Richard F. BRIMLEY, Plaintiff and Appellant, v. Joseph S. GASSER, Jr., Defendant and Respondent.
• Court: Utah Court of Appeals

Page 97

754 P.2d 97

Richard F. BRIMLEY, Plaintiff and Appellant, v. Joseph S. GASSER, Jr., Defendant and Respondent.

No. 870154-CA.

Court of Appeals of Utah.

May 13, 1988.

Wynn E. Bartholomew (argued), Midvale, for plaintiff and appellant.

Don B. Allen (argued), Ray, Quinney & Nebeker, Salt Lake City, for defendant and respondent.

Before GREENWOOD, JACKSON and DAVIDSON, JJ.

OPINION

DAVIDSON, Judge:

Plaintiff Richard Brimley appeals from the district court's order which: 1) granted defendant Joseph Gasser's motions for satisfaction of judgment and relief from judgment; and 2) refused Brimley's motion that he was entitled to certain personal property of Gasser's which Brimley had purchased at a sheriff's sale.

Although the parties to this appeal share a lengthy history, it is sufficient to begin on May 1, 1981, when Brimley obtained a default judgment against Gasser in the amount of $36,650.00, with interest accruing at the rate of eight percent per annum. For one year Gasser ignored the judgment and paid nothing. Then, on May 29, 1982, Gasser executed a promissory note payable to Brimley in the amount of $41,501.62 with interest accruing at eighteen percent per annum. The note was due "on or before December 31, 1982 said loan to be secured by fifty thousand shares of investment lettered stock in Telecake International, Inc., lender has the option to keep the stock in lew [sic] of payment of said loan." At this time, Gasser represented to Brimley that: 1) the Telecake stock would increase in value so substantially that it would be worth more than the amount due Brimley under the promissory note; and 2) Brimley could retain the Telecake stock instead of accepting Gasser's full payment on the note.

Gasser failed to make any payments to Brimley on the May 1982 promissory note. On April 18, 1986, Brimley's attorneys advised Gasser by letter of his default, and of Brimley's intention to enforce his legal rights under the note. Gasser failed to respond to the April 18, 1986 letter.

On April 28, 1986, Brimley's attorneys advised Gasser that Brimley intended to reject his option to "keep" the Telecake stock instead of demanding payment in full on the note; further, that Brimley was consigning the Telecake stock to a third party for public sale and would apply the proceeds of that sale to reduce Gasser's obligations under the note; and that failure of the Telecake stock sale to generate sufficient funds to satisfy Gasser's note obligations would keep alive the judgment, for which the note was given. The sale of the Telecake stock generated $13,750.00.

Brimley's attorneys then discovered that Gasser possessed an interest in the Gasser Family Limited Partnership (partnership). Brimley, accordingly, executed on Gasser's interest in the partnership and purchased that interest at a constable's sale on July 15, 1986. The principal asset of the partnership consisted of Telecake stock. After some dispute with the transfer agent over who should be entitled to the Telecake stock in light of the execution sale, Brimley was issued a certificate for 394,515 shares, this representing a 1/9 share of the partnership assets. The certificate was later cancelled by the transfer agent pending disposition on appeal.

In the meantime, Gasser had filed motions for stay of execution, relief from judgment, and satisfaction of judgment. The last two motions were brought before Judge Moffat at the October 29, 1986 hearing.

At that hearing Judge Moffat found:

[T]hat the promissory note dated May 29, 1982 made, executed and delivered by defendant and payable to the order of plaintiff, increased the interest rate expected to be received by plaintiff from defendant, granted other benefits to plaintiff, was supported by adequate consideration and was taken by plaintiff in satisfaction of (or in lieu of) the obligations of defendant theretofore represented by that certain Judgment by Default entered in the above-entitled case on the 12th day of May, 1981....

The court further found that the actions of Brimley evidenced an intention by him to rely upon and act under the provisions of the promissory note and associated pledge of stock. The court made no findings or rulings with respect to defendant's claim that all obligations, including the May 29, 1982 promissory note, were discharged...