Hill v. Estate of Allred
| Decision Date | 01 May 2009 |
| Docket Number | No. 20060752.,No. 20030980.,20030980.,20060752. |
| Citation | 216 P.3d 929,2009 UT 28 |
| Parties | Virginia HILL, Plaintiff, Appellant, and Cross-Appellee, v. ESTATE OF Owen A. ALLRED; Corporation of the Presiding Elder of the Apostolic United Brethren; J. LaMoine Jenson; Jenson Lumber Corporation, Inc.; and Estate of John C. Putvin, Defendants, Appellees, and Cross-Appellants, Dennis E. Matthews; Jeffrey J. Norman; James E. Sandmire; Diamond Auto Specialists, Inc.; Diamond Recreational Rentals, Inc.; Pacific Rim Mortgage and Loan Services, Inc.; Pacific Rim Mortgage Brokers, Inc.; Diamond Auto Body and Paint; Brisan Imports; and Last Resort Enterprises, Inc., Defendants and Appellee. |
| Court | Utah Supreme Court |
Dennis E. Matthews, Eagle Mountain, pro se appellee.
¶ 1 Virginia Hill appeals the order of the district court awarding her damages on her claims of civil conspiracy, conversion, and fraudulent misrepresentation and denying her claims of money laundering and racketeering. Defendants cross-appeal, challenging the district court's award of damages. We affirm in part and reverse in part.
¶ 2 The district court made extensive findings of fact below, on which we base the following recitation of the pertinent facts.
¶ 3 Virginia Hill moved to southern Utah from Michigan, seeking a fresh start in life following marital difficulties. While visiting St. George, Ms. Hill became acquainted with John Shugart, the leader of a small religious group, and asked Mr. Shugart for help purchasing real property known as the Desert Inn Ranch. The owner of the ranch had set a purchase price of $1.5 million, which Ms. Hill could have paid in cash. A friend of Mr. Shugart, Dennis Matthews, agreed to help Ms. Hill negotiate with the owner to purchase the ranch. The owner of the ranch told Mr. Matthews that he did not want to receive payments in cash and did not want to receive payment as a lump sum. To further facilitate the purchase of the ranch, Mr. Matthews suggested that Ms. Hill hire John Putvin, a former real estate agent, which she did.
¶ 4 Mr. Shugart then delivered $1 million in cash, belonging to Ms. Hill, to Mr. Putvin and Mr. Matthews and directed them to proceed with the purchase of the ranch. Mr. Shugart, Mr. Matthews, and Mr. Putvin decided to invest some of Ms. Hill's money to generate cash flow to make payments on the ranch and to increase the amount of the principal. Ms. Hill agreed, in general, to the plan of investing her money.
¶ 5 Once Mr. Matthews and Mr. Putvin received Ms. Hill's money, they became concerned about how the purchase of the ranch would affect their relationship with the Corporation of the Presiding Elder of the Apostolic United Brethren, a religious group with which they were affiliated. Mr. Shugart had previously attempted to purchase the ranch with the help of the AUB, but the ranch had been foreclosed upon. The AUB lost a significant amount of money as a result, and it blamed Mr. Shugart for its loss. Additionally, the leader of the AUB, Owen Allred, considered Mr. Shugart to be a threat to his ecclesiastical leadership. Mr. Matthews feared that they would be compromising their loyalty to Mr. Allred, who he believed to hold authority of divine origin, by helping Mr. Shugart purchase the ranch, so they decided that they should discuss the matter of Ms. Hill and the ranch with Mr. Allred.
¶ 6 When Mr. Matthews and Mr. Putvin met with Mr. Allred, they represented that the money came from Ms. Hill with "no strings attached." Ms. Hill was described as a woman who wanted "to atone for ... past sins." The men revealed, however, that Mr. Shugart was involved in the ranch acquisition discussions and that Mr. Shugart wished to grant Mr. Matthews operational control over the ranch under the title of "bishop." Mr. Allred told Mr. Matthews and Mr. Putvin to proceed with the purchase of the ranch, and Mr. Matthews agreed to side with Mr. Allred in the event that Mr. Allred's instructions regarding the ranch conflicted with those of Mr. Shugart. Later, Mr. Matthews met with Mr. Allred, unaccompanied by Mr. Putvin. At this meeting, Mr. Allred ordained Mr. Matthews as the bishop of the ranch in order to preempt any attempt by Mr. Shugart to do so.
¶ 7 In addition to the $1 million already given to Mr. Matthews and Mr. Putvin, Ms. Hill provided them, through Mr. Shugart, with another $500,000 for the purchase of the ranch and paid Mr. Putvin $40,000 for his services.
¶ 8 Mr. Matthews and Mr. Putvin received $1.54 million of Ms. Hill's money in total but never delivered the promised ranch or repaid any of the money. They had other individuals use the cash (in amounts less than $10,000 to avoid IRS reporting requirements) to open bank accounts and then write checks back to Mr. Putvin. They gave a bag of cash to J. LaMoine Jenson, the owner of Jenson Lumber Corporation, Inc.,1 who deposited portions of the money along with his regular deposits and eventually returned a check for $30,000 to Mr. Putvin. Mr. Putvin paid some of the money to the AUB, which he characterized as tithing. A check was later delivered back to Mr. Putvin by Mr. Allred. Mr. Matthews used some of the money to conduct home improvements and to pay federal tax liens.
¶ 9 Mr. Putvin also used Ms. Hill's money to establish various businesses with James Sandmire. These businesses then purchased inventory and facilities using the money. Diamond Auto Specialties, Inc., one of the businesses Mr. Putvin and Mr. Sandmire founded with Ms. Hill's money, used Ms. Hill's money to purchase real property. Mr. Putvin loaned Ms. Hill's money to Diamond Auto and structured the repayment of the money so that repayment would be made to the AUB. Mr. Putvin assigned his rights under the trust deed for the real property to the AUB, and payments were made to them.
¶ 10 Mr. Putvin did make some effort to purchase the ranch after he and Mr. Matthews assumed control of Ms. Hill's money. An option agreement was drafted, but never executed, and Mr. Putvin never made the required $500,000 down payment on the ranch.
¶ 11 Ms. Hill soon became concerned about the status of her money. She and Mr. Shugart met with both Mr. Matthews and Mr. Allred. Mr. Matthews told her that Mr. Putvin had all her money and was nowhere to be found. Mr. Allred denied knowing anything about her money. Ms. Hill eventually hired private investigators, who attempted to locate Mr. Putvin. They were unsuccessful. All the people they interviewed, including Mr. Matthews and Mr. Sandmire, told them they were unaware of Mr. Putvin's whereabouts. During this time, Mr. Shugart informed Ms. Hill that he had received divine revelations that it was God's will that she not pursue litigation to recover her money. Finally, one of Ms. Hill's investigators received a tape of the initial meeting between Mr. Putvin, Mr. Matthews, and Mr. Allred. She was thereafter able to learn what had happened to her money. Upon learning that none of her money remained in Mr. Putvin's possession and could not be returned to her, she filed suit.
¶ 12 Suit was filed in August 1997 against Mr. Allred,2 Mr. Matthews, Mr. Putvin,3 the AUB, Mr. Jenson, Jenson Lumber Corp., Mr. Sandmire, and several other defendants, alleging claims of civil conspiracy, constructive fraud, conversion, unjust enrichment, money laundering, fraudulent misrepresentation, racketeering, and intentional infliction of emotional distress.4
¶ 13 Defendants denied all the allegations, asserting that the statute of limitations had run on all of Ms. Hill's claims. Ms. Hill argued that her claims were timely because she was unaware of them until November 1994 due to the misrepresentations made by Defendants. Further, Ms. Hill showed that Mr. Putvin was out of the state for substantial periods of time between 1990 and 1996. The Fourth District Court held that Ms. Hill's claims were not timely filed and dismissed them, with the exception of those against Mr. Putvin. Ms. Hill appealed, and we reversed and remanded. Hill v. Allred, 2001 UT 16, ¶ 1, 28 P.3d 1271.
¶ 14 Following a bench trial, the district court found that Mr. Allred, Mr. Matthews, Mr. Putvin, the AUB, Mr. Jenson, Jenson Lumber Corp., and Mr. Sandmire all engaged in a civil conspiracy to deprive Ms. Hill of $1.54 million. Further, the district court held that Defendants converted Ms. Hill's money and that they made fraudulent misrepresentations to her. The court also found that although there were instances where Defendants engaged in money laundering, Ms. Hill could not bring a cause of action for money laundering as a private citizen. Finally, the district court held that Ms. Hill did not meet her burden of proof on her claims of racketeering and intentional infliction of emotional distress.
¶ 15 The district court awarded Ms. Hill $1.54 million in actual damages plus prejudgment interest and costs. The court declined Ms. Hill's request for punitive damages, holding that punitive damages were not available because Ms. Hill came to the court with unclean hands. The district court held the parties jointly liable for the damages awarded; however, it apportioned that amount as follows: Mr. Matthews and Mr. Putvin were held personally liable for the entire amount of damages, to be reduced by the amounts other defendants were held liable for; Mr. Allred was held liable for only $30,000; Mr. Jenson and Jenson Lumber Corp. for $30,000, collectively; the AUB for $250,000; and Mr. Sandmire for $500,000.
¶ 16 The parties filed an array of post-trial motions. Ms. Hill filed a motion to reconsider and modify the...
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