Jessen v. Jessen
| Decision Date | 26 February 2002 |
| Docket Number | No. 00-204.,00-204. |
| Citation | 2002 WY 33,41 P.3d 543 |
| Parties | Daniel L. JESSEN, Appellant (Plaintiff), v. Dennis L. JESSEN and Raymond Jessen, jointly and severally, Appellees (Defendants). |
| Court | Wyoming Supreme Court |
Alexander K. Davison and Wendy Curtis of Patton & Davison, Cheyenne, WY. Argument by Ms. Curtis, Representing Appellant.
Larry B. Kehl of Buchhammer and Kehl, P.C., Cheyenne, WY. Argument by Mr. Kehl, Representing Appellees.
Before LEHMAN, C.J., and GOLDEN, HILL and KITE, JJ, and SPANGLER, D.J. Ret.
[¶ 1] Appellant Daniel L. Jessen (son) appeals from the trial court's order, which quieted title in or, in the alternative, granted an equitable lien in favor of appellee Raymond Jessen (uncle).
[¶ 2] We reverse in part and affirm in part.
[¶ 3] The son presents the following issues for our analysis:
[¶ 4] In 1984, Dennis Jessen (father) conveyed certain real property to his son by way of a quitclaim deed. The son was three years old at the time of this conveyance. The quitclaim deed was recorded in October of 1984. Since that time, the father has continued to farm and manage the property. He has also resided on the property rent-free and has used earnings made from the property operations to pay his own personal expenses.
[¶ 5] The father failed to pay income taxes on the property for the years 1984, 1986, 1988 and 1990, resulting in a tax liability of $139,248.31. In 1992, the property was placed in the hands of a public conservator who managed the property for the son, a minor at the time. The Internal Revenue Service (IRS) issued a Notice of Levy and Notice of Seizure on the property. The public conservator filed a complaint and request for a temporary restraining order and asked the court to declare the liens and levies wrongful. The IRS counterclaimed, alleging that the father had fraudulently transferred the property to the son. The Federal District Court found the transfer to be fraudulent and set it aside. The IRS seized and sold the property at a foreclosure sale. Shortly before the expiration of the redemption period, the father approached his uncle for assistance in redeeming the property. The uncle loaned him $80,960.00 to redeem the property in exchange for a quitclaim deed, which granted the father the option to buy back the property. This deed was recorded in February of 1999.
[¶ 6] A dispute between the son and the father arose in 1999 over ownership of the property. The uncle was subsequently joined. Prior to trial, the father and son reached a settlement, and the father was dismissed from the case. The issues between the son and the uncle were not settled, and the case went to trial. The trial court quieted title in the uncle and also imposed an equitable lien on the property in favor of the uncle as alternative relief in the event this court held the son's rights to the property to be superior to the uncle's. The son appeals from this decision.
[¶ 7] This case was tried before the trial court, which made findings of fact and conclusions of law.
The factual findings of a judge are not entitled to the limited review afforded a jury verdict. While the findings are presumptively correct, the appellate court may examine all of the properly admissible evidence in the record. Due regard is given to the opportunity of the trial judge to assess the credibility of the witnesses, and our review does not entail re-weighing disputed evidence. Findings of fact will not be set aside unless they are clearly erroneous. A finding is clearly erroneous when, although there is evidence to support it, the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed.
Hammond v. Hammond, 14 P.3d 199, 203 (Wyo.2000) (quoting Fremont Homes, Inc., v. Elmer, 974 P.2d 952, 958 (Wyo.1999) (citations omitted)). This court reviews the trial court's conclusions of law de novo. Hammond, 14 P.3d at 201
. This court can affirm the judgment on any legal ground appearing in the record. City of Laramie v. Hysong, 808 P.2d 199, 202 (Wyo.1991).
[¶ 8] The son insists that when the conveyance of the property to him was declared fraudulent, the conveyance was set aside only to the extent necessary to satisfy defrauded creditors and not as between the parties. He also claims that the redemption of the property merely returned the property to its presale status, meaning title returned to him. The son finally contends that the trial court erred by granting the uncle an equitable lien as alternative relief in the event this court found the son's interest in the property to be superior to the uncle's.
[¶ 9] Although the son and his father have settled the issues with regard to the property between themselves, the son requests this court to determine who has superior rights in an attempt to show that because his father did not have any rights to the property, he did not have any rights to quitclaim to the uncle in exchange for the redemption money.
[¶ 10] In order to analyze these issues, this court must begin by deciding what effect the federal court's finding that the conveyance from the father to the son was fraudulent had on each parties' ownership rights. Courts have generally held that a fraudulent conveyance is valid as between the parties and that the conveyance is voidable only at the option of creditors or others within the protection of the statutes to the extent that is necessary to satisfy any debts. 37 Am.Jur.2d Fraudulent Conveyances and Transfers § 89 (2001). Therefore, a conveyance that is fraudulent as to creditors, remains valid as between the parties to the transaction. 37 Am.Jur.2d Fraudulent Conveyances and Transfers § 95. "[T]he transferee becomes vested with such ownership and title as the transferor possessed and purported to convey." Id. The rationale behind this position is that a fraudulent transferor should not be allowed to benefit from his own misdeed. See Smith, Keller & Associates v. Dorr & Associates, 875 P.2d 1258, 1269 (Wyo.1994)
(). See also Wantulok v. Wantulok, 67 Wyo. 22, 214 P.2d 477, 480 (1950) ().
[¶ 11] Given these legal principles, we conclude that the conveyance between the father and son was merely voidable at the option of the father's creditors, here the IRS, rather than completely void as between father and son. We also point out, however, that the IRS did void the transaction at least as far as it was concerned when it foreclosed on the property to satisfy the father's debt.
[¶ 12] Although neither party contested the father's right to redeem the property, we considered this issue given our conclusion that the conveyance remained valid as between the father and the son. The right to redeem is purely statutory; therefore, redemption may only occur in strict compliance with the statutes that govern it. 55 Am.Jur.2d Mortgages § 895 (1996). Wyo. Stat. Ann. § 1-18-103 (LexisNexis 2001) describes who may redeem a piece of property as, "any person, his heirs, executors, administrators, assigns or guarantors whose real property has been sold by virtue of an execution, decree of foreclosure, or foreclosure by advertisement and sale[.]" Because the transfer had been voided as far as the IRS was concerned, in this limited circumstance, the father did possess the right to redeem the property from the...
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