Erker v. Kester

• Decision Date: 28 September 1999
• Docket Number: No. 98-565.,98-565.
• Citation: 1999 MT 231,988 P.2d 1221
• Parties: Dennis ERKER and Doreen Erker, Plaintiffs, Respondents, and Cross-Appellants, v. Robert L. KESTER and Marcia M. Kester, Defendants, and Appellants.
• Court: Montana Supreme Court

988 P.2d 1221

1999 MT 231

Dennis ERKER and Doreen Erker, Plaintiffs, Respondents, and Cross-Appellants, v. Robert L. KESTER and Marcia M. Kester, Defendants, and Appellants.

No. 98-565.

Supreme Court of Montana.

Submitted on Briefs March 11, 1999.

Decided September 28, 1999.

As Amended October 4, 1999.

Michael C. Coil, Angel Law Firm, Bozeman, Montana, For Appellants.

Donald E. White, Bozeman, Montana, For Respondents.

Justice JAMES C. NELSON delivered the Opinion of the Court.

¶ 1 Defendants and Appellants Robert L. Kester and Marcia M. Kester (Kesters) appeal the order of the Eighteenth Judicial District Court, Gallatin County, granting summary judgment to Plaintiffs and Respondents Dennis Erker and Doreen Erker (Erkers). Kesters assert that the District Court's application of the doctrine of equitable estoppel was improper and genuine issues of material fact remain in dispute concerning the conveyance of a small parcel of property between the parties. Erkers, by cross-appeal, claim they should be awarded attorney's fees under Montana's Foy exception.

¶ 2 We affirm the District Court's order and deny Respondents' request for attorney's fees.

¶ 3 In reaching the same conclusion as the District Court, but on different grounds, we address the following issues on appeal:

1. Did the filing of Certificate of Survey No. 887, pursuant to the Montana Subdivision and Platting Act, enlarge an individual parcel of land, which was the subject of the sale and purchase agreement between Kesters and Erkers, thereby requiring the delivery of the Parcel A deed?

2. Should Kesters be held responsible for payment of Erkers' attorney's fees under the Foy exception?

Background Facts

¶ 4 This case involves a dispute over a portion of an asphalt driveway (Parcel A) in Big Sky, Gallatin County, Montana. Like most driveways, this one leads to a house, which the record indicates is located on Lot 26, Block 3, of the Meadow Village subdivision (Lot 26). Erkers purchased the house from Kesters for approximately $310,000. The sale commenced August 21, 1990, and closed on January 2, 1991. Throughout six years of ownership, Erkers accessed the property using Parcel A.

¶ 5 Erkers maintain that purchase of the house, under the August 21, 1990 sale and purchase agreement, included the entire driveway. If so, the $310,000 price included Parcel A, a 1,614 square-foot, triangle-shaped piece of land that provides the only ingress and egress to Lot 26 from the cul-de-sac on Looking Glass Road. Kesters, on the other hand, claim that in conveying a deed to Lot 26, they never intended to convey the entire driveway; rather, the sale and purchase of this allegedly separate slice of asphalt would be negotiated later, for an amount in addition to the $310,000 purchase price of Lot 26.

¶ 6 The record indicates that the entire asphalt driveway, which continuously covers Parcel A and extends into Lot 26, was installed by Kesters during the construction of the house on Lot 26. The record further shows that Erkers inspected the property prior to their purchase, and found no physical indications that any parcel was separate and distinct from Lot 26.

¶ 7 The documentation of the transaction between the parties is not entirely consistent. The sale and purchase agreement, signed August 21, 1990, describes the property as "Lot 26 Block 3 (Kester House) Big Sky Meadow Village" and does not expressly mention Parcel A. An August 22, 1990 addendum to the agreement—drafted and signed by Kesters' real estate agent—refers to "the sale of Lot 26, Block 3 plus the added contiguous tract." (Emphasis added). The January 2, 1991 deed purports to convey:

Lot 26, Block 3 of Meadow Village, Big Sky of Montana, Inc., Second Filing, Gallatin County, Montana, according to the official plat thereof on file and of record in the office of the County Clerk and Recorder of Gallatin County, Montana.

¶ 8 On April 1, 1991, approximately four months after the closing on the Kester-Erker transaction, Kesters' attorney sent a letter to Erkers' attorney indicating that Parcel A had not been conveyed by the Lot 26 deed, a fact brought to Kesters' attorney's attention by a title insurance company. The letter requested that Erkers pay "additional consideration" in exchange for the second deed. The record provides no evidence beyond mere allegations that the necessity or desire to separately sell Parcel A was, at any time prior to April 1, 1991, contemplated or communicated by either party. Additionally, Kesters admit that the issues of access to Lot 26 and the desire to separately sell Parcel A never entered discussions between them and their real estate agent, who drafted portions of the sale and purchase documents.

¶ 9 This dispute simmered unresolved for five years, marked by offers, counteroffers, idle threats, and bitter rejections. In November of 1996, Erkers wished to sell the house to a third party. Rather than hold up the sale, Kesters agreed to convey Parcel A to Erkers, who then conveyed the parcel, along with Lot 26, to their buyers as a whole—resulting in a deed that effectively and finally merged the description of the two parcels into one. As a condition of this conveyance, Erkers agreed to place $16,000 of the purchase price in escrow. Subsequently, this litigation ensued over Parcel A, to resolve who was entitled to all or some of the escrow funds.

¶ 10 The record further provides a detailed history of Parcel A, which is relevant to the foregoing dispute. The reader's understanding of this history will be aided by referring to the plat map appended to this opinion.

¶ 11 Legally, Parcel A did not exist until March 24, 1980, when Certificate of Survey No. 887 (COS 887) was properly filed with the Gallatin County Clerk and Recorder showing that a common boundary between two lots was relocated. The survey was conducted between October 1 and October 19 of 1979, at the behest of Lone Pine, Inc., owner of Tract D, and Roland Croghan, who had sold Lot 26 to Robert Kester. The boundary relocation essentially clipped off the northwest corner from Tract D and thereby expanded the southwest portion of Lot 26, which lies to the north of Tract D.

¶ 12 The timing of the survey is relevant in that Croghan deeded Lot 26 to Robert Kester on October 6, 1979, five days after the survey had commenced. Once the survey was completed, Lone Peak, Inc. deeded Parcel A to Croghan on May 7, 1980. Croghan, in turn, deeded Parcel A to Robert Kester on May 20, 1980. Both deeds were properly recorded on May 22, 1980.

¶ 13 As a result of the boundary relocation, the survey describes "LOT 26 and PARCEL A," as "[a] Tract of land" that contains 16,110 square feet and indicates the general purpose of the survey: "TO ADD 1,614 SQ. FT. TO LOT 26, BLOCK 3, MEADOW VILLAGE." The survey also provides a common metes and bounds description, with a solid line tracing the new boundary, with a dotted line indicating the former boundary line separating Lot 26 and Tract D. COS 887 also provides a separate legal description of Parcel A, including its 1,614 square-foot dimensions.

¶ 14 Robert Kester claims he was unaware of the Croghan-Lone Peak, Inc. survey, the boundary relocation, and the May 20, 1980 deed from Croghan to him. The record indicates Robert Kester was not required to pay additional consideration for Parcel A. At precisely what point he, or he and his wife,¹ became aware of their ownership interest in the additional 1,614 square feet—which the record indicates provided them with their only access to Lot 26—is not clear. Records submitted by Kesters indicate they owed $108.37, plus $39.14 in delinquent taxes, on Parcel A for the 1991 tax year. The record also indicates that taxes had been paid—by whom, it is not clear— between November 30, 1989 and November 27, 1997. In his affidavit, Robert Kester claims he began paying taxes on Parcel A sometime in 1983.

¶ 15 Thus, following the filing of COS 887, one properly surveyed and legally described boundary contained one lot and one parcel, each with a separate deed and tax liability. The District Court, in granting Erkers' motion for summary judgment, determined under the theory of equitable estoppel that the whole—Lot 26 and Parcel A—was the subject of the sale and purchase contract between the parties, and that Kesters, owing to their failure to disclose the existence of Parcel A and the landlocked condition of Lot 26, were estopped from asserting any claim to the contrary. The court denied Kesters' claim to any share of the escrow funds, and further ordered that each party was responsible for their own attorney's fees. Kesters appealed, and Erkers cross-appealed.

Standard of Review

¶ 16 This Court reviews an order granting summary judgment under Rule 56, M.R.Civ.P., by utilizing the same criteria as the district court. See Bruner v. Yellowstone County (1995), 272 Mont. 261, 264, 900 P.2d 901, 903. Summary judgment is a remedy which should be granted when there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. See Rule 56(c), M.R.Civ.P. The procedure should never be substituted for trial if a material factual controversy exists. See Payne Realty v. First Sec. Bank (1993), 256 Mont. 19, 24, 844 P.2d 90, 93

.

¶ 17 The party seeking summary judgment has the burden of demonstrating a complete absence of any genuine factual issues. See D'Agostino v. Swanson (1990), 240 Mont. 435, 442, 784 P.2d 919, 924

. This Court looks to the pleadings, depositions, answers to interrogatories, admissions on file, and affidavits to determine the existence or nonexistence of a genuine issue of material fact. See Rule 56(c), M.R.Civ.P.; Ulrigg v. Jones (1995), 274 Mont. 215, 218-19, 907 P.2d 937, 940. Furthermore, on review, all reasonable inferences that might be drawn from the offered evidence should be drawn in favor of the party opposing summary judgment. See Payne, 256 Mont. at 25,

844 P.2d at 93....