Kantor v. Kantor
| Decision Date | 13 September 2016 |
| Docket Number | Docket No. 41946 |
| Court | Idaho Supreme Court |
| Parties | Robert Aron KANTOR, Plaintiff–Counterdefendant–Respondent, v. Sondra Louise KANTOR, Defendant–Counterclaimant–Appellant |
Thompson Smith Woolf & Anderson, PLLC, Idaho Falls, for appellant Sondra Kantor. Marty R. Anderson argued.
Ludwig Shoufler Miller Johnson, LLP, Boise, for respondent Robert Kantor. Scot M. Ludwig argued.
This is one of two consolidated cases that Robert and Sondra Kantor appealed to this Court; the other is Kantor v. Kantor , Docket No. 42980. This appeal is from the district court's dismissal of Sondra's claim that Robert breached a Property Settlement Agreement (PSA) as a sanction, its grant of summary judgment against her, and its award of attorney fees to Robert. We affirm in part, reverse in part, and remand the case for further proceedings.
Robert and Sondra were married for forty-three years before they divorced in 2012. As part of their divorce settlement, Robert and Sondra entered into the PSA on April 25, 2012. The PSA divided the parties' property, including their interests in a number of business entities. The PSA did not result in an entirely clean break between the parties, as a number of Robert and Sondra's joint business ventures remained intact. A judgment of divorce was entered on April 30, 2012. This judgment did not incorporate the PSA.
Although this opinion will refer to other portions of the PSA, the following terms are of particular importance to this appeal:
This case initially related to the parties' efforts to sell the community residence which was the subject of Section 5 of the PSA (the property). The parties owed Bank of America approximately $3.4 million on a note secured by the property and another bank $1 million on a home equity line of credit (HELOC), which was secured by a second priority interest in the property. At the time, Bank of America was subject to a consent judgment in an action brought by the Department of Justice. That consent judgment required Bank of America to provide relief to qualifying customers in the form of loan forgiveness and restructuring of debts. The other bank completely forgave the parties' debt on the HELOC. This litigation results from Robert's efforts to seek debt forgiveness and/or restructuring of the $3.4 million obligation to Bank of America which was secured by the property.
In late September of 2012, the parties contracted to sell the property in a short sale for $2.4 million in a cash transaction scheduled to close within 30 days, contingent upon Bank of America's approval of the short sale. The parties were asked to sign a document that extended the period for the contingency to be satisfied to October 5, 2012. Sondra evidently perceived this as an opportunity to apply leverage to secure Robert's compliance with other terms of the PSA, and she sent him an email indicating that she would not extend the contingency until a number of demands were satisfied.
On October 11, 2012, Robert responded to Sondra's demand by filing a complaint seeking contract damages and injunctive relief due to her failure to sign the extension agreement. Sondra signed the required document later the same day. In November of 2012, Sondra answered Robert's complaint and counterclaimed for breach of contract, an accounting relating to the parties' assets, and fraud. In that same month, the short sale fell through. This was through no fault of the parties; rather, Bank of America had failed to obtain a required appraisal.
In February of 2013, the Kantors entered into a second agreement with the prospective purchasers to sell the property for $2.4 million. Although Bank of America initially approved this short sale in late March, whereby it would have waived a deficiency in excess of $1.4 million, on April 3, 2013, it revoked that approval because Robert was pursuing a loan modification that had potential to result in even more of the parties' debt being forgiven.1
In March, Robert moved for partial summary judgment, seeking a declaration that Sondra had breached the PSA by failing to timely sign the extension document and dismissal of Sondra's counterclaims for breach of contract and fraud. Robert's motion was heard on June 24, 2013. The district court granted summary judgment dismissing Sondra's breach of contract (Count I) and fraud (Count III) counterclaims and held that Sondra was obligated to sign the short sale extension document. Robert had argued that the attorney fees he had incurred were damages resulting from Sondra's failure to sign the short sale extension. The district court then ruled:
So her not signing did not cause the contract—and I want that underlined, did not cause contract damages. It did provoke a claim for fees, I'll rule on that, but that's a judge issue, it's not a jury issue, so this issue won't go to the jury. That's an issue for the Court to determine who the prevailing party is and whether someone gets fees under a contract, under the divorce contract, or by statute or for some other reason.
On July 18, 2013, Robert moved for an award of attorney fees and costs totaling $19,334.53 based upon the attorney fees provision of the PSA.
This action then morphed into a dispute over Robert's efforts to obtain a loan modification from Bank of America. On August 7, 2013, the district court entered its order permitting Sondra to amend her counterclaim. On August 9, 2013, Sondra filed an amended answer and counterclaim alleging that, among other things, Sondra had been damaged by Robert's attempts to obtain a loan modification. The same day, both parties sought injunctive relief. Sondra asked the district court to prohibit Robert from further pursuit of the loan modification and to require him to participate in the short sale of the property. Robert asked that Sondra be prohibited "from contacting Bank of America regarding the current financing" of the property.
The parties' respective motions for injunctive relief came before the court on September 12, 2013. There, Robert contended that a loan modification could reduce the parties' $3.4 million debt to $1.5 million. Three witnesses testified, including Sondra. She testified to her trepidation about pursuing the loan modification, expressing concern about letting Robert stay in the property indefinitely and the potential tax consequences of debt forgiveness. Following a recess, the parties announced a stipulation withdrawing their respective motions. Sondra agreed not to contact Bank of America in the four-month period before the scheduled trial, and Robert agreed to diligently pursue a loan modification from Bank of America. The Court entered an order consistent with the parties' stipulation on October 16, 2013.
On October 9, 2013, Robert filed a Motion to Compel Recording of Quitclaim Deed in which he asked that Sondra be required to quitclaim her interest in the property to him. In his supporting affidavit, Robert asserted that Bank of America required that Sondra quitclaim her interest in the property "to complete their loan modification review." Sondra took prompt action to defeat the district court's ability to grant such relief. The next day, Sondra quitclaimed her interest in the property to her boyfriend, Al LaPeter, in exchange for $100 "subject to" the obligation to Bank of America.2
On October 17, 2013, Sondra submitted the PSA to the magistrate court in the parties' divorce action and requested that it be incorporated in a supplemental judgment. Proceedings related to this motion gave rise to the companion case in Docket No. 42980.
Robert's motion came before the district court for hearing on November 15, 2013. The district court stated: "What appears to me to be evident is that she has moved her interest away from herself in order to prevent the Court from ordering a transfer of the property to Mr. Kantor." The court then made it clear that it intended to exercise control over the parties to achieve an end that it perceived to be in the parties' best interests:
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