Kassebaum v. Kassebaum

• Decision Date: 30 January 2001
• Citation: 42 S.W.3d 685
• Parties: (Mo.App. E.D. 2001) Dennis Kassebaum and Sandra L. Kassebaum, Respondents/Cross-Appellants, v. Vernon E. Kassebaum and Wanda R. Kassebaum, Appellants/Cross-Respondents. ED77211 0
• Court: Missouri Court of Appeals

42 S.W.3d 685 (Mo.App. E.D. 2001)

Dennis Kassebaum and Sandra L. Kassebaum, Respondents/Cross-Appellants, v. Vernon E. Kassebaum and Wanda R. Kassebaum, Appellants/Cross-Respondents.

ED77211

Missouri Court of Appeals Eastern District

01/30/2001

Appeal From: Circuit Court of Franklin County, Hon. Walter A. Murray, Jr.

Counsel for Appellant: Gael Davis Wood

Counsel for Respondent: Melvin G. Franke

Opinion Summary: Dennis E. Kassebaum (Son) and Sandra L. Kassebaum (Wife) (collectively Plaintiffs) filed a petition seeking specific performance of a Contract For General Warranty Deed entered into with Vernon E. Kassebaum (Father) and Wanda R. Kassebaum (Mother) (collectively Defendants). Defendants counterclaimed for rescission of the Contract. The trial court entered a judgment that neither granted specific performance nor rescinded the Contract, but rather returned "the parties to their intended positions." Defendants appealed from this judgment, and Plaintiffs cross-appealed.

Division Four holds: Because the trial court's statement regarding attorney Jonathan Downard's character was immaterial to the trial court's resolution of the legal issue, the trial court did not materially err in failing to recuse itself. (1) The trial court did not err in applying the parol evidence rule because the Contract was unambiguous and complete on its face and the evidence and offers of proof cited by Defendants did not fall into the exceptions to the parol evidence rule argued by Defendants. (2) The trial court did not err in not ordering rescission of the Contract because Defendants did not present clear, cogent, and convincing evidence of failure of or inadequate consideration, unilateral mistake, constructive fraud, fraudulent concealment, or breach of an implied term. (3) The trial court did not err in finding and concluding Defendants' anticipatory breach by repudiation. (4) Because Downard was not a party to the action, the trial court was without jurisdiction to order Downard to prepare new deeds. Thus, this specific portion of the judgment is not binding, and this Court modifies the judgment accordingly. However, the error did not materially affect the merits of the action. (5) The trial court did not err in ruling that Defendants repudiated or breached the Contract because Son's decision not to farm the family farm exclusive of outside work was not a breach of the Contract excusing Defendants from any further duty to perform. (6) Because neither the value of the performance nor the object or purpose of the Contract has been destroyed or nearly destroyed, the trial court did not err in failing to apply the doctrine of commercial frustration. (7) The trial court did not abuse its discretion in failing to order specific performance because it ordered the parties to perform in such a manner as to put them in the position that they intended under the Contract.

Sherri B. Sullivan, Judge

Dennis E. Kassebaum ("Son") and Sandra L. Kassebaum ("Wife") (collectively "Plaintiffs") filed a petition seeking specific performance of a Contract For General Warranty Deed ("Contract") entered into with Vernon E. Kassebaum ("Father") and Wanda R. Kassebaum ("Mother") (collectively "Defendants"). Defendants counterclaimed for rescission of the Contract. The trial court entered a judgment that neither granted specific performance nor rescinded the Contract, but rather returned "the parties to their intended positions." Defendants appeal from this judgment and Plaintiffs cross-appeal. We affirm as modified the trial court judgment.

Plaintiffs are the eldest son and daughter-in-law of Defendants.¹ Defendants own the family farm consisting of about 312 acres. Son worked with Father on the family farm beginning in 1972, when Son graduated from high school. In 1973, Son married Wife, and they lived on the family farm. In 1980, Son and Wife moved to Wife's father's farm. After an unsuccessful attempt to farm there, Son and Wife moved back to the family farm after about a year and a half. Son and Father continued to work the family farm together until 1989.

In 1989, Father decided to retire, and he approached Son about buying the family farm. After discussions "around the kitchen table," Plaintiffs agreed to purchase the family farm from Defendants for $300 per acre. Attorney Jonathan Downard ("Downard") drafted the Contract along with a General Warranty Deed from Defendants to Plaintiffs and a Quit Claim Deed from Plaintiffs to Defendants. The documents were executed on April 7, 1989. The latter two documents were to be held in escrow. However, instead of holding the documents in escrow, all three documents were recorded in the following order: (1) the General Warranty Deed; (2) the Quit Claim Deed; and (3) the Contract.

Because of this error, in late 1989 or early 1990, Downard had the parties come to his office to execute new documents with the same terms as the original documents. Defendants do not dispute that they validly executed a second set of documents; however, they do dispute the validity of the quit claim deed ("Exhibit 6"), the general warranty deed ("Exhibit 7"), and the contract for general warranty deed ("Exhibit 8") admitted at trial. The new documents were backdated to April 7, 1989, and all three documents were then held in escrow. Exhibit 8 was recorded in January 1996.

At some point in time, Father notified Son that he would no longer guarantee Son's operating loan on the family farm entered into with a bank in January 1989. Father testified that he took this action in June 1991 because Son was driving a truck, and he did not want Son to purchase his own truck with the money. Son testified that Father notified him on the day the new documents were executed, and in order to continue to pay for the farm, Son began driving a truck. Son drove a truck without pay starting in March 1991, part-time with pay in July 1991, and full-time with pay in 1992. Plaintiffs also began renting out the family farm in 1992. Although Defendants told Son that they did not like him driving a truck, they did not tell him that they believed doing so violated the Contract. Father testified that he "was unhappy with it, but there was nothing [he] could do" because he "had signed a contract for general warranty deed."

Also in April 1991, Defendants executed a Joint Revocable Living Trust Agreement, an Assignment of Interest in Contract for General Warranty Deed, and a quit claim deed to themselves as trustees of the trust transferring the family farm to the trust. The quit claim deed was recorded in June 1991.

In light of this recording and the delayed recording of Exhibit 8, Downard suggested to Son that he get a general warranty deed from the trust to be held in escrow, and Son agreed. Downard sent a letter to Defendants explaining the situation. In April 1996, Defendants met Downard at his office. At this meeting, Defendants refused to execute a general warranty deed from the trust because they felt they did not need to because they had signed the General Warranty Deed in 1989. Father told Downard that, after speaking with another attorney, he did not believe that Exhibit 8 was valid, and he was not going to honor it. Father also said that he wanted to put Son back into his inheritance to receive one-fifth of his estate and not to receive the family farm. At trial, Father denied making these statements. Although Mother did not affirmatively participate in the conversation at the April 1996 meeting, she did not contradict Father's statements.

In September 1996, Plaintiffs, through their attorney, informed Defendants by letter that they believed Defendants had repudiated the Contract, called for a closing date of November 1, 1996, and tendered full payment of the amount owed under the Contract. In a letter dated November 10, 1996, Defendants stated to Plaintiffs that Plaintiffs breached the Contract for various reasons and that Defendants' letter was not an attempt to break the Contract but rather an exercise of their options under it. On December 23, 1996, Plaintiffs filed a Petition for Specific Performance of the Contract based upon Defendants' repudiation of the Contract. Defendants answered with various affirmative defenses going to the validity of the Contract and counterclaimed for rescission of the Contract.

In August 1999, after a court-tried case, the trial court concluded that:

" Plaintiffs are entitled to have a Warranty Deed in escrow". Further, Defendants are entitled to a Quit Claim deed to insure that if Plaintiffs do not make the required payments then they will be able to cancel the Contract for Deed. This will return the parties to their intended positions.

The trial court entered judgment accordingly.

In a court-tried case, we will affirm the judgment of the trial court unless it is unsupported by substantial evidence, it is against the weight of the evidence, or it erroneously declares or applies the law. Murphy v. Carron, 536 S.W.2d 30, 32 (Mo. banc 1976). We accept the evidence and inferences favorable to the prevailing party and disregard all contrary evidence. Mullenix-St. Charles Properties, L.P. v. City of St. Charles, 983 S.W.2d 550, 555 (Mo.App. E.D. 1998). We defer to the factual findings of the trial court, which is in a superior position to assess the credibility of witnesses. Id. However, we independently evaluate the trial court's conclusions of law. Id.

DEFENDANTS' APPEAL

Defendants present eleven points on appeal. In their point one on appeal, Defendants argue that the trial court erred in not recusing itself under Missouri Supreme Court Rule 2, Canon 2 and Canon 3E, because the trial court showed an appearance of unfairness and lack of impartiality in: (1) its ruling on the contested evidentiary issue of breach/repudiation that was based on Downard's testimony; and (2) its discussion of the validity of Exhibits 6, 7, and 8. Defendants assert that the trial court based its ruling on its...