Cassidy v. Pavlonnis

• Jurisdiction: Oregon
• Parties: Theresa CASSIDY, fka Theresa Pavlonnis, Plaintiff-Appellant, v. Richard A. PAVLONNIS, Defendant-Respondent, and Dawn Pavlonnis and Channing Hartelius, Defendants.
• Citation: 205 P.3d 58,227 Or. App. 259
• Docket Number: 032291.,A131746.
• Court: Oregon Court of Appeals
• Decision Date: 01 April 2009

205 P.3d 58

227 Or. App. 259

Theresa CASSIDY, fka Theresa Pavlonnis, Plaintiff-Appellant, v. Richard A. PAVLONNIS, Defendant-Respondent, and Dawn Pavlonnis and Channing Hartelius, Defendants.

032291.

A131746.

Court of Appeals of Oregon.

Argued and Submitted August 6, 2008.

Decided April 1, 2009.

Robert P. Johnson, Portland, argued the cause and filed the briefs for appellant.

Guy B. Greco, Newport, argued the cause and filed the briefs for respondent.

Before HASELTON, Presiding Judge, and ARMSTRONG, Judge, and ROSENBLUM, Judge.

ROSENBLUM, J.

Plaintiff brought this action alleging that defendant breached a property settlement agreement that the parties, who are former spouses, entered into as part of the dissolution of their marriage. During their marriage, the parties owned a house near Lincoln City, which they used as a vacation home. The property settlement agreement (PSA) provided that defendant would receive legal title to the house and that plaintiff would receive a life estate and would be entitled to one-third of the proceeds in the event that the house was sold. Four years after the parties entered into the PSA, plaintiff gave defendant a quitclaim deed to the property. Thereafter, defendant sold the property and refused to pay plaintiff a portion of the proceeds, leading plaintiff to bring this action for breach of contract. The trial court granted summary judgment in defendant's favor, concluding that the quitclaim deed unambiguously conveyed all of plaintiff's interests in the property, including her interest in a share in the proceeds. Plaintiff appeals, arguing that the deed is ambiguous and, thus, that summary judgment was inappropriate. We affirm.

In reviewing a grant of summary judgment, we view the facts and all reasonable inferences that can be drawn therefrom in the light most favorable to the nonmoving party—in this case, plaintiff—to determine whether there are any genuine issues of material fact and whether the moving party is entitled to judgment as a matter of law. ORCP 47 C. The parties' PSA was approved by the dissolution court and incorporated into the judgment dissolving the marriage in 1996. With respect to the property at issue in this case—the parties' vacation home—the PSA provides:

"It is agreed that such property shall be transferred to [defendant] and that he shall hold such property for the benefit of the parties and their children as herein provided. [Plaintiff] shall have a life estate interest in the subject property and have a right to the proceeds of sale as more fully set forth in this paragraph."

The PSA provides further that defendant would pay all mortgage payments, taxes, and insurance. It also provides:

"The parties also agree that [plaintiff] may request in writing that the foregoing property be sold, and upon sale of the same she shall be entitled to receive either one-third of the net proceeds after deduction of sales costs only of the same or, in the event [defendant] desire[s] to acquire her interest therein, one-third of the mutually agreed upon fair market value of the property."

The PSA also provides that its provisions may be modified by, among other things, "operation of law" or a "joint written agreement between the parties * * *."

Pursuant to the PSA, plaintiff gave defendant a bargain and sale deed for the property, but defendant never recorded the deed.

Although defendant was responsible for making the mortgage payments, the PSA did not require him to refinance the existing mortgage, which was in both parties' names. Defendant had a poor credit rating, which, because plaintiff's name was still on the mortgage, adversely affected plaintiff's credit rating. In 2000, plaintiff asked defendant how she could restore her credit rating. He told her that she needed to give him a quitclaim deed so that he could refinance the mortgage in his own name. Plaintiff executed a quitclaim deed that states the following:

"[Plaintiff] does hereby remise, release, and quitclaim unto [defendant] * * * all of the grantor's right, title and interest in that certain real property with the tenements, hereditaments, and appurtenances thereunto belonging or in any way appertaining, situated in the County of,[sic] State of Oregon, described as follows, to-wit:

"Lot 11 and the North 1/2 of Lot 12, Block 1, BARRIGAR CREST, in the City of Lincoln City, County of Lincoln and State of Oregon.

"and all rights in regard to the estate in this property retained or given to grantor pursuant to the decree of dissolution entered on March 6, 1996 in Clackamas County Circuit Court, Case No. 95-10-148

"To Have and to Hold the same unto the grantee and grantee's heirs, successors, and assigns forever.

"The true and actual consideration paid for this transfer, stated in terms of dollars, is $1.00."

The quitclaim deed was recorded in Lincoln County, and defendant subsequently refinanced the property in his name only. In 2002, defendant sold the property without giving notice to plaintiff. He did not pay any of the sale proceeds to plaintiff.¹

Plaintiff later learned that defendant had sold the house. In 2004, she brought this action alleging, among other things, breach of contract and seeking a portion of the proceeds of the sale of the house.² Defendant moved for summary judgment, arguing that the PSA was modified by the quitclaim deed. He contended that the deed relinquished plaintiff's right to the proceeds from a subsequent sale of the property. Plaintiff opposed the motion, asserting that the quitclaim deed relinquished at most only plaintiff's life estate in the property and did not affect her right to a share of the proceeds from a sale, which she argued was a personal property interest. The trial court granted the motion, stating, "The release by the Plaintiff via quitclaim deed of all of her right, title and interest in the subject property, likewise included any right she might otherwise have had to proceeds from a future sale." The court entered a judgment in defendant's favor.

On appeal, plaintiff argues that the trial court erred in granting defendant's motion for summary judgment because a genuine issue of material fact existed regarding the extent of the interest conveyed by the quitclaim deed. She contends that the deed is ambiguous because it does not state whether she relinquished her right to a share of the proceeds from a sale of the property, which she again characterizes as a personal property interest rather than an interest in the real property.³ In asserting that the deed is ambiguous plaintiff points to the circumstances surrounding the execution of the deed—namely, her reason for executing it—arguing that the circumstances give rise to a reasonable inference that she did not intend to relinquish her interest in the proceeds of a future sale of the property.

In response, defendant contends that plaintiff's construction of the deed is implausible, arguing that the quitclaim deed unambiguously relinquished all of plaintiff's interest in the property.⁴ Because, in his view, the deed is unambiguous, defendant argues that no factual issues remain to be decided and that the trial court correctly granted summary judgment in his favor.

A deed is subject to the ordinary rules of contract construction. Realvest Corp. v. Lane County, 196 Or.App. 109, 116, 100 P.3d 1109 (2004). In a dispute over the meaning of a contract, a party is entitled to summary judgment only if the terms of the contract are unambiguous. Milne v. Milne Construction Co., 207 Or.App. 382, 388, 142 P.3d 475, rev. den., 342 Or. 253, 149 P.3d 1212 (2006). A term in a contract is ambiguous if, when examined in the context of the contract as a whole, including the circumstances in which the agreement was made, it is susceptible to more than one plausible interpretation. Batzer Construction, Inc. v. Boyer, 204 Or.App. 309, 319, 129 P.3d 773, rev. den., 341 Or. 366, 143 P.3d 239 (2006); see also Abercrombie v. Hayden Corp., 320 Or. 279, 292, 883 P.2d 845 (1994) (a court may "consider parol and other extrinsic evidence to determine whether the terms of an agreement are ambiguous"); City of Eugene v. Monaco, 171 Or.App. 681, 687, 17 P.3d 544 (2000), rev. den., 332 Or. 240, 28 P.3d 1175 (2001) ("[T]he extrinsic...