City of St. Louis v. K & K Investments

• Decision Date: 11 July 2000
• Citation: 21 S.W.3d 891
• Parties: (Mo.App. E.D. 2000) . City of St. Louis, Respondent, v. K&K Investments, Inc., et al., Appellants. Case Number: ED76598 Missouri Court of Appeals Eastern District Handdown Date: 0
• Court: Missouri Court of Appeals

21 S.W.3d 891 (Mo.App. E.D. 2000)

This slip opinion is subject to revision and may not reflect the final opinion adopted by the Court.

City of St. Louis, Respondent, v. K&K Investments, Inc., et al., Appellants.

Case Number: ED76598

Missouri Court of Appeals Eastern District

Handdown Date: 07/11/2000

Appeal From: Circuit Court of St. Louis County, Hon. Patrick Clifford

Counsel for Appellant: Sally Austin Mills

Counsel for Respondent: Julius H. Berg, P.C.

Opinion Summary: K&K Investments, Inc., Golden Delta Investment Corporation, Chase Mortgage Company and Two K Investments, Inc., appeal from summary judgment in favor of the City of St. Louis on the City's action to set aside a foreclosure sale and deed and quiet title.

AFFIRMED.

Division One holds: (1) The trial court did not err in setting aside the foreclosure and quieting title in that the foreclosure took place within six months of the death of a person who died owning the subject real estate in contravention to section 443.300 RSMo 1994. (2) The City had standing in that it was the record owner at the time of the foreclosure and had a threatened injury.

Opinion Author: Gary M. Gaertner, Presiding Judge

Opinion Vote: AFFIRMED. Simon and J. Dowd, JJ., concur.

Opinion:

Appellants, K&K Investments, Inc., Golden Delta Investment Corporation, Chase Mortgage Company and Two K Investments, Inc., appeal from the judgment of the Circuit Court of St. Louis County in favor of respondent, City of St. Louis, ("City"), granting City's motion for summary judgment on its action to set aside a foreclosure sale and deed and quiet title. We affirm.

The subject property was conveyed on January 14, 1971, by general warranty deed to Minnie P. Conway, for and during the term of her natural life, with full power to use and enjoy the same, and to sell, mortgage, lease or otherwise dispose of the fee simple title, with the remainder, undisposed of, at the time of her death, if any, to Janet Conway. The deed was recorded on March 8, 1971. By deed of trust dated January 14, 1971 and recorded April 1, 1971, Minnie P. Conway conveyed a security interest in the property to Dan Boyle, as Trustee for City-wide Mortgage, Co., to secure the sum of $16,800. The deed provides in part:

Said party of the third part shall have the power successively to remove the above-mentioned Trustee or any successor Trustee, and to appoint in writing (acknowledged and recorded), a successor to such Trustee, which successor shall succeed to the title and all of the rights and powers of the original Trustee. ...

Whenever used, the singular number shall include the plural, the plural the singular, and the use of any gender includes all genders.

On June 1, 1997, Source One Mortgage Services Corporation assigned the deed of trust to Chemical Mortgage Company. The assignment was recorded December 1, 1997.

On January 22, 1998, Janet M. Conway died.

On March 12, 1998, by "Appointment of Substitute Trustee," Chemical Mortgage Company removed Dan Boyle as Trustee and appointed Berry F. Laws, III, Richard L. Martin, Thomas J. Fritzlen, Jr., and Geri L. Dreiling, as "Alternate Successor Trustees," under the deed of trust.

On March 23, 1998, Notices of Trustee's Sale under the deed of trust were sent by certified mail to Minnie P. Conway and Janet M. Conway.

On March 26, 1998, four of the alternate successor trustees, Berry F. Laws, III, Richard L. Martin, Thomas J. Fritzlen, Jr., and Debbie Boesch, advertised the foreclosure sale which ran until April 23, 1998.

On March 27, 1998, Minnie P. Conway, by her attorney in fact, Keith Conway, recorded a general warranty deed conveying the property to the City of St. Louis.¹

On or about March 31, 1998, the notice of trustee's sale, mailed via certified mail to Janet M. Conway, was returned to the Law Offices of Martin, Leigh and Laws, marked "deceased."

On April 23, 1998, Berry F. Laws, III, as alternate successor trustee, conveyed the property to K&K Investments, ("K&K"), for $6,655.29.

On that same day, by quitclaim deed, K&K conveyed an undivided one-half interest in the property to Golden Delta Investment Corp., ("Golden Delta"). The deeds were recorded on April 28, 1998, and May 4, 1998, respectively.

On or about July 31, 1998, City filed its petition to set aside foreclosure sale and deed and quiet title.

On or about December 15, 1998, a motion to substitute parties was filed, to substitute Two K Investments, Inc., for Chase Mortgage Company, f/k/a Chemical Mortgage Company.

On or about June 18, 1999, City filed its motion for summary judgment.

On July 22, 1999, the trial court entered a judgment for City, finding Berry F. Laws, III, had no authority to act as trustee to conduct the foreclosure sale, as he was not validly appointed as such. The trial court found the foreclosure sale to be null and void because sale took place within six months after the death of an owner, (Janet Conway), in contravention to Section 443.300 RSMo 1994.²

K&K, Golden Delta, Chase Mortgage Company and Two K Investments, Inc. appeal.

Appellants raise numerous points on appeal; we will address those necessary to dispose of the case at bar.³

When considering appeals from summary judgment, we review the record in the light most favorable to the non-movant, and give that party the benefit of all reasonable inferences. ITT Commercial Finance Corp. v. Mid-American Marine, 854 S.W.2d 371, 376 (Mo.banc 1993). Our review is essentially de novo. Id. "A trial court's entry of summary judgment will be affirmed if it is sustainable as a matter of law on any ground." Weil v. Kirn, 952 S.W.2d 399, 401 (Mo.App.E.D. 1997).

Appellants argue the trial court erred in granting City's motion for summary judgment because the sale of the property by foreclosure, within six months of the death of Janet M. Conway, was not prohibited by Section 443.300. We disagree.

Section 443.300, Death of debtor, foreclosure stayed provides:

If any person shall die owning real estate on which there is an outstanding deed of trust or mortgage of real estate, or having subjected personal property to a security interest with a power of sale, shall die, no sale shall take place under the deed of trust or mortgage conveying real estate within six months after the death of such person, and no sale shall take place of personal property so subjected to a security interest within four months after the death of the person.

In Williams v. Kimes, 996 S.W.2d 43, 45 (Mo.banc 1997), the Supreme Court held that contingent remainder holders were owners, entitled to notice under Section 443.325.3(2). Under section 443.325.3(2), owners of property as of forty days prior to the scheduled foreclosure date, are entitled to actual notice of the proceedings. The Supreme Court found the "failure to provide notice of a foreclosure sale to owners of the foreclosed property is a substantial defect sufficient to render the sale void and prevent the transfer of title in the property". Therefore, the court set aside the foreclosure and restored the parties to their ex ante positions. Id.

In the case at bar, we have no issue with Section 443.325.3(2) because Janet Conway was sent notice of the foreclosure date. However, Section 443.300 is at issue because if a person dies owning real estate, foreclosure is stayed for six months. The plain reading of Section 443.300 and the Supreme Court's findings in Williams v. Kimes, dictates that Janet Conway, who had a remainder interest in the property at the time of her death, was indeed a person who died owning real estate. Further, Williams v. Kimes dictates the proper remedy was for the foreclosure to be set aside and...