Huff v. Jennings

• Decision Date: 02 May 1995
• Docket Number: No. 2363,2363
• Parties: William A. HUFF, Appellant, v. Kathleen P. JENNINGS, Respondent. . Heard
• Court: South Carolina Court of Appeals

Page 886

459 S.E.2d 886

319 S.C. 142

William A. HUFF, Appellant, v. Kathleen P. JENNINGS, Respondent.

No. 2363.

Court of Appeals of South Carolina.

Heard May 2, 1995.

Decided June 19, 1995.

Rehearing Denied Aug. 10, 1995.

O.W. Bannister, of Hill, Wyatt, Bannister & Brown; and Kenneth C. Porter, of Porter & Rosenfeld, Greenville, for appellant.

Samuel W. Outten, of Leatherwood, Walker, Todd & Mann, Greenville, for respondent.

HOWELL, Chief Judge:

William Huff sued attorney Kathleen Jennings for slander of title for filing an allegedly invalid lien against Huff's property. Jennings admitted filing the lien and that Huff had satisfied it, but claimed several defenses to the suit. Both sides moved for summary judgment, and stipulated to certain facts. The trial court granted summary judgment for Jennings, and Huff appeals. We reverse and remand.

Huff was married to Betty Jean Huff (the Wife). They divorced in September 1990. As part of the equitable distribution, the family court awarded the Wife an interest in the marital house and lot. The Wife was represented by Jennings in the divorce and sought an award of attorney's fees from Huff. The divorce decree, however, provided:

16. Plaintiff [the Wife], with her attorney, has prevailed on the issue of custody, however, due to Plaintiff's inability to prove the divorce as she requested, I find it fair and equitable for each party to be fully and completely responsible for the prompt discharge and payment of their own attorney's fees and costs associated with this action.

Shortly after the divorce, Huff elected to purchase the Wife's interest, as provided for in the divorce decree. On October 8, 1990, Kenneth Porter, Huff's attorney in the divorce, forwarded to Jennings a deed to be executed by the Wife as part of Huff's buy-out of her interest. In a second letter to Jennings, dated October 31, 1990, Porter stated he had received no response from the first letter but that Huff told him the Wife would not sign the deed. Porter also indicated that the Wife stated Jennings no longer represented her, and Porter offered to deal directly with the Wife. Porter added, "I would rather close this matter through your office as it is my understanding some additional attorney's fees are owed unto you."

On November 3, 1990, Jennings wrote Porter that the Wife refused to sign the deed. Jennings confirmed that she was still the Wife's lawyer and was still owed fees. On November 14, 1990, Jennings filed a lien for unpaid attorneys fees in the amount of $578.36 (plus interest) against the house and lot, purportedly under S.C.Code Ann. § 20-3-145. ¹ Subsequent to the filing of the lien, Huff closed the purchase of the Wife's interest. Jennings did not receive any of the funds from the sale of the Wife's interest, nor did she receive notice of the closing.

Sometime in 1993, Huff sought to refinance the outstanding debt on the house and lot. Huff's attorney found the lien of record and refused to close the refinancing until the lien and debt were cleared from public records. At that time, Jennings claimed unpaid attorney's fees and interest in the amount of $935.79. On June 8, 1993, Huff wrote Jennings that he discovered the lien, which "was apparently placed against the property when it was still titled in both our names." Huff stated he needed to settle the matter because he needed to refinance his home. Huff paid Jennings $935.79 on July 6, 1993, and Jennings satisfied the lien the same day.

In August 1993, Huff filed this slander of title action against Jennings. In his complaint, Huff alleged that as an attorney, Jennings knew or should have known she had no valid lien against the property, and that filing the lien created a cloud on Huff's title. Huff claimed he suffered damages in the amount of $935.79, the amount he was compelled to pay Jennings. Because he claimed Jennings's actions were wilful and wanton, Huff also sought punitive damages.

Jennings answered and admitted she filed the lien for $578.36, plus 18% per annum interest pursuant to her agreement with the Wife, against Huff's property. She also admitted Huff satisfied the lien on July 6, 1993, by paying $935.79. However, Jennings maintained no action for slander of title exists in South Carolina, and that Huff, therefore, failed to state a cause of action. As additional defenses, Jennings alleged she acted in good faith, even if her lien was invalid, and that she filed the lien pursuant tos 20-3-145, given the Wife owed her attorney fees and also owned an interest in Huff's house and lot. Jennings contended Huff assumed the risk when he purchased the Wife's interests in the house on November 14, 1990, subject to and with record notice of Jennings's lien. Finally, Jennings asserted that by paying the lien and voluntarily satisfying the Wife's debt, Huff acted on his own as a volunteer and could not recover against Jennings.

The trial court ruled that Jennings's lien was valid and that the Wife did not pay her fees as ordered by the family court; thus, Jennings properly filed a lien against the property of her client pursuant to § 20-3-145. The court further found that because Huff purchased the Wife's interest with notice of Jennings's lien and paid the Wife $11,789.00 without satisfying the lien, the lien was binding on Huff. Moreover, the court held the question of the validity of the lien was moot, because Huff satisfied the lien. The court also found Huff lacked standing to raise any issue as to the validity of Jennings's lien, and that only the Wife could challenge the lien.

As to Huff's claim of slander of title, the trial court found that such a cause of action exists in South Carolina. Relying on a West Virginia case, the court determined the elements of the cause of action to be:

(1) the publication of (2) a false statement (3) derogatory to plaintiff's title (4) with malice (5) causing special damages (6) as a result of diminished value in the eyes of third parties.

See TXO Production Corp. v. Alliance Resources Corp., 187 W.Va. 457, 419 S.E.2d 870 (1992), aff'd, 509 U.S. 443, 113 S.Ct. 2711, 125 L.Ed.2d 366 (1993). However, the court found Huff's claim failed because there was no evidence that a false statement was made by Jennings, that the filing of the lien was derogatory to Huff's title, that Jennings filed the lien with malice, or that the property was diminished in value in the eyes of a third party. The trial court therefore granted Jennings's motion for summary judgment.

I.

Huff first argues the trial court erred in holding Jennings had a valid lien against her own client for attorney's fees under S.C.Code Ann. § 20-3-145. We agree.

Under section 20-3-145, any attorney fee awarded by the court in a divorce action shall constitute a lien on any property owned by the person ordered to pay the fee. Thus, the statute authorizes the filing of a lien where the family court actually makes an award of attorney's fees. Simply declaring that each party will be responsible for their own fees does not, as Jennings contends, equate to an "attorney fee awarded by the court" for purposes of the statute. The Wife's complaint requested that Huff pay the Wife's attorney's fees; there was no request that the Wife be ordered to pay her own fees. Under Jennings's interpretation of the order, the family court effectively awarded, without notice to the Wife, an indeterminate amount of fees when such relief was never requested. This interpretation clearly raises substantial ethical and constitutional questions. We therefore conclude that Jennings's lien filed pursuant to S.C.Code Ann. § 20-3-145 was invalid, because she was not awarded a fee by the court.

II.

Huff also argues the trial court erred in ruling his attack on the validity of the lien was moot since he already paid Jennings and she discharged the lien. We agree. The lien was attached to Huff's property from November 14, 1990 through July 6, 1993. The fact that the lien was thereafter removed does not extinguish any claim for slander of title Huff may have for the thirty-two months the lien was attached to the property. Accordingly, we hold Huff's claim was not rendered moot by his payment to Jennings to discharge her lien.

III.

Huff next argues the trial court erred in concluding Huff lacked standing to contest the validity of Jennings's lien. We agree.

To have standing, a party must have a personal stake in the subject matter of a lawsuit, and must be a real party in interest. Bailey v. Bailey, --- S.C. ----, 441 S.E.2d 325 (1994). A real party in interest is "one who has a real, actual, material or substantial interest in the subject matter of the action, as distinguished from one who has only a nominal, formal, or technical interest in, or connection with, the action." Id. at ----, 441 S.E.2d at 327. At the time Jennings filed her lien, the property was owned jointly by Huff and the Wife. Under the circumstances of this case, Huff clearly has standing to litigate whether Jennings's lien against property in which Huff had an ownership interest was valid.

IV.

By way of an additional sustaining ground, Jennings contends the trial court erred in holding South Carolina recognizes a cause of action for slander of title. We find no error.

While there are South Carolina cases mentioning a slander of title cause of action, see, e.g., Gambrell v. Schriver, 312 S.C. 354, 440 S.E.2d 393 (Ct.App.1994), cert. denied (July 14, 1994); Burgess v. Stern, 311 S.C. 326, 428 S.E.2d 880 (1993), cert. denied, 510 U.S. 865, 114 S.Ct. 186, 126 L.Ed.2d 145 (1993); Mountain Lake Colony v. McJunkin, 308 S.C. 202, 417 S.E.2d 578 (1992), there is no reported South Carolina case directly recognizing the cause of action. However, slander of title has long been recognized as a common law cause of action. See TXO, 419 S.E.2d at 877-79 (thorough discussion of the action for slander of title as it developed under the common law of England). South Carolina Code...