Brookside Mobile Home Park, Ltd. v. Peebles

• Citation: 48 P.3d 968,2002 UT 48
• Decision Date: 07 May 2002
• Docket Number: No. 20001078.,20001078.
• Parties: BROOKSIDE MOBILE HOME PARK, LTD., a Utah Limited Partnership dba Brookside Mobile Home Park, Petitioner, v. Sam PEEBLES aka Samuel B. Peebles, an individual; and Harold Boyd Peebles, an individual, Respondents.
• Court: Supreme Court of Utah

48 P.3d 968

2002 UT 48

BROOKSIDE MOBILE HOME PARK, LTD., a Utah Limited Partnership dba Brookside Mobile Home Park, Petitioner, v. Sam PEEBLES aka Samuel B. Peebles, an individual; and Harold Boyd Peebles, an individual, Respondents.

No. 20001078.

Supreme Court of Utah.

May 7, 2002.

Dennis K. Poole, John L. Adams, Salt Lake City, for petitioner.

Russell A. Cline, Salt Lake City, for respondents.

On Certiorari to the Utah Court of Appeals

WILKINS, Justice.

¶ 1 Brookside Mobile Home Park, Ltd. ("Brookside") seeks review of the decision of the court of appeals, Brookside Mobile Home Park, Ltd. v. Peebles, 2000 UT App 314, 14 P.3d 105, (1) affirming the trial court's denial of Brookside's summary judgment motion, (2) affirming the trial court's grant of a directed verdict in favor of Sam and Harold Peebles on Brookside's unlawful detainer claim, (3) affirming the denial of attorney fees to Brookside, and (4) awarding attorney fees to the Peebles. Sam and Harold Peebles also seek review of the decision of the court of appeals upholding the jury verdict finding that Brookside did not unreasonably withhold approval of a prospective purchaser of the Peebles' mobile home. For the reasons set forth below, we affirm the court of appeals on all issues.

BACKGROUND

¶ 2 Brookside operates a mobile home park ("Park") located in West Jordan, Utah. Sam and Harold Peebles (son and father, respectively) owned a mobile home which occupied a space in the Park. Sam Peebles ("Peebles") entered into a lease for the underlying Park space with a former owner of the Park, Brookside Associates ("Associates"), in 1983. After several leases and failed sales of the mobile home, Peebles entered into a lease with an option to buy the mobile home with Richard Rowley in May 1994, who, in turn, entered into a lease with Associates for the underlying Park space. In December 1994 a trust purchased the Park from Associates and acquired all of Associates' interest in some of the leases of mobile home space at the Park. In 1995 Brookside acquired its interest in the Park from the trust. Rowley entered into a lease agreement for the Park space with Brookside in April 1995, but abandoned the mobile home in the fall of 1995.

¶ 3 Sometime shortly after Rowley's abandonment of the mobile home, Peebles began paying rent to Brookside for the underlying Park space. On November 29, 1995, Brookside sent a notice to Peebles stating, "[Y]ou, as lien holder of record and now deemed a tenant at will are primarily liable to [Brookside] for all rent and service charges accruing. . . if the mobile home is not moved." On December 11, 1995, Brookside sent Peebles a "Notice to Pay Rent or Quit," which stated, in relevant part, "Please take notice that the rent on the premises ... which you now possess as a tenant, is past due.... You must . . . pay the rent now due and owing. . . or, in the alternative, . . . vacate the premises . . .." Around the same time, Brookside advised Peebles that repair work needed to be done on the mobile home to bring it into compliance with Park rules. In March 1996 Brookside informed Peebles, through counsel, that he would need to sign a new lease for the Park space with Brookside. Peebles did not sign a lease. On April 11, 1996, Brookside posted a "Notice to Quit" on Peebles' mobile home. The Notice demanded that Peebles remove the mobile home from the Park within five days under section 78-36-3 of the Utah Code or face an unlawful detainer action. Peebles did not move the mobile home and Brookside filed an unlawful detainer action against Sam and Harold Peebles. The Peebles answered and asserted as an affirmative defense, among other things, that Brookside had failed to comply with the fifteen-day notice requirement in the Utah Mobile Home Park Residency Act ("Residency Act"). See Utah Code Ann. § 57-16-6 (Supp.2001).

¶ 4 On September 25, 1996, Peebles entered into a contract to sell the mobile home to Jackie Southworth, subject to Brookside's approval of her Park residency application. Pursuant to Brookside's instructions, Southworth ordered a credit report, which was unable to verify her employment and bank information. Southworth submitted the credit report to Brookside. The Park manager told Southworth that her application for residency had been denied by the owner. As a result, the Peebles filed a counterclaim, alleging, among other things, that Brookside unreasonably withheld approval of Southworth's residency application, in violation of the Residency Act.

¶ 5 Brookside moved for summary judgment, arguing that because Peebles had no lease with Brookside, the Residency Act did not apply and that, consequently, under Utah's unlawful detainer statute, the five-day notice was sufficient. Brookside also asserted that as a bona fide purchaser of the Park, it had no notice of Peebles' lease and that, consequently, the lease was invalid as to Brookside, rendering the five-day notice sufficient. Peebles argued that because he had a lease with Associates, which had been assigned to Brookside, the Residency Act applied, and the five-day notice was therefore insufficient. The trial court determined that the claims turned on whether there was a lease between the parties. If so, then the Residency Act applied, and Brookside should have given the Peebles a fifteen-day notice; if not, Utah's unlawful detainer statute applied and Brookside's five-day notice was sufficient.

¶ 6 The trial court initially granted summary judgment for Brookside, holding that, as a matter of law, Peebles had surrendered his lease with the Park by virtue of his knowledge that the residents of his mobile home entered into leases for the same space with Brookside. Shortly thereafter, the Peebles filed a motion for reconsideration asking the trial court to reconsider the summary judgment ruling based on a supplemental affidavit which put Peebles' intent to surrender the lease into dispute. The trial court granted this motion, finding that the existence of a lease was a disputed issue of material fact, and overturned its previous summary judgment ruling. The matter proceeded to trial.

¶ 7 After Brookside presented its case, the Peebles moved for a directed verdict, arguing in part that, regardless of the existence of a lease, Sam Peebles was an "owner resident" of the mobile home, Utah Code Ann. § 78-36-3(2) (1996) ("Unlawful detainer by an owner resident of a mobile home is determined under [the Residency Act]."), and, as such, was entitled to a fifteen-day notice. The trial court granted the motion. The court also dismissed all claims against Harold Peebles, finding that Brookside had presented no evidence at trial of any involvement on his part.

¶ 8 Peebles then presented his counterclaims to the jury. Southworth testified that she had been prepared to explain the credit report deficiencies to Brookside, but had been denied an opportunity to do so and that the Park manager yelled at her when she protested Brookside's refusal to discuss the matter further. The Park manager testified that he is unable to yell due to throat cancer. The jury found (1) that Peebles had a lease with the Park before Brookside acquired it, (2) that Peebles had not surrendered the lease, (3) that Brookside had not assumed the lease, and (4) that Brookside had not unreasonably withheld approval of Southworth's residency in the Park. Both parties filed motions for attorney fees and costs under the Residency Act, which the trial court denied.

¶ 9 Brookside appealed the trial court's reversal of its original summary judgment ruling, the grant of a directed verdict, and the denial of attorney fees and costs to the court of appeals. Peebles cross-appealed the jury's verdict that withholding approval of Southworth was not unreasonable and the denial of attorney fees and costs. The court of appeals reversed the trial court on the issue of attorney fees for Peebles, but affirmed on all other issues. The parties requested certiorari review, which this court granted.

ISSUES PRESENTED

¶ 10 The parties present six issues for our review, specifically, whether the court of appeals erred in (1) holding that Brookside did not preserve its bona fide purchaser argument for appeal; (2) upholding the trial court's reversal of its summary judgment ruling; (3) affirming the trial court's grant of Peebles' motion for directed verdict; (4) affirming the trial court's denial of attorney fees for Brookside and in allowing attorney fees for Peebles; (5) disregarding Brookside's arguments that Harold Peebles should have been reinstated as a defendant; and (6) upholding the jury's finding that Brookside's rejection of a prospective buyer of Peebles' mobile home was reasonable.

ANALYSIS

¶ 11 On certiorari, we review the decision of the court of appeals for correctness. E.g., State v. Visser, 2000 UT 88, ¶ 9, 22 P.3d 1242

.

I. PRESERVATION OF BONA FIDE PURCHASER ARGUMENT

¶ 12 In a footnote to its opinion, the court of appeals declined to address Brookside's bona fide purchaser argument, holding that, under Badger v. Brooklyn Canal Co., 966 P.2d 844, 847 (Utah 1998), the issue had not been properly preserved for appeal. Brookside Mobile Home Park, Ltd. v. Peebles, 2000 UT App 314, ¶ 18 n. 3, 14 P.3d 105. Before addressing Brookside's arguments on this issue, we take this opportunity to clarify the requirements for preserving issues for appellate review.

¶ 13 One of Brookside's arguments before the court of appeals centered around its contention that it should have been granted summary judgment based on its bona fide purchaser theory. Brookside raised this theory before the trial court in support of its original motion for summary judgment, which the trial court granted. The court of appeals held that Brookside did not preserve this issue because it did not raise the argument again in response to Peebles' motion to reconsider the summary judgment ruling. In the eyes of the court of appeals, "[a]t that...