Larabee v. Eichler
| Decision Date | 16 December 2008 |
| Docket Number | No. SC 89097.,SC 89097. |
| Citation | 271 S.W.3d 542 |
| Parties | Steven C. LARABEE and Frances C. Larabee, Appellants, v. Buddy EICHLER and Dorothy Eichler, Respondents. |
| Court | Missouri Supreme Court |
J. Eric Mitchell, Johns Lilleston & Mitchell, LLC, Clinton, MO, for Appellants.
James Owen Kjar, Shipley & Kjar, L.L.C., Warsaw, MO, for Respondents.
Steven and Frances Larabee ("Larabees") brought an action against Buddy and Dorothy Eichler ("Eichlers") for misrepresentation as to the sale of certain real property located in Benton County, Missouri. The trial court granted the Eichlers' motion for summary judgment as to Count I, stating the Larabees' action was barred by statute of limitations section 516.120(5).1 The trial court also granted Eichlers' motion for summary judgment as to Count II, finding the Larabees' failed to produce evidence of damages to support their claim.
The Court holds that a seller of real property charged with fraudulent misrepresentation cannot rely upon county real estate records as constructive notice of the fraud. The Court also holds that the Larabees came forward with sufficient evidence of damages to support their claim. The judgment of the trial court is reversed, and the case is remanded.
On March 1, 1998, the Larabees entered into an agreement to purchase a parcel of land owned by the Eichlers and located in Benton County, Missouri ("1998 Agreement"). Buddy and Dorothy Eichler were the owners and developers of a subdivision known as Sterett Creek Village. Additionally, Buddy Eichler served as a trustee for the Sterett Creek Village Trusteeship ("Trusteeship") from 1986 through 2004.
The Eichlers made both oral and written representations to the Larabees that they owned several lots located in Sterett Creek Village as well as the surrounding undeveloped parcels of land and that all of the property was or would be subject to the rights and privileges of the Trusteeship, including restrictive covenants.2 On April 10, 1998, the Eichlers executed a warranty deed that conveyed Lot 403, Sterett Creek Village, a subdivision in Benton County, Missouri, and subject to easements, restrictions and reservations of record, to the Larabees. Two years later, in 2000, relying on similar representations made by the Eichlers, the Larabees agreed to purchase Lot 402, Sterett Creek Village, and the Eichlers executed a warranty deed conveying the property to the Larabees ("2000 Agreement").
The Larabees built and lived in a home on Lot 403, Sterett Creek Village. Until 2004, the Larabees were billed and paid assessments and well hookup fees to the Trusteeship; allowed to attend and vote in the annual meetings of the Trusteeship; and enjoyed the use of the Sterett Creek Village swimming pool and pavilion; all of which was known and permitted by the Eichlers.
Beginning in 2002, the Eichlers placed brush piles and a mobile home camper on a parcel of land adjoining the Larabees' property. Subsequently, the Larabees initiated a lawsuit seeking to enforce the restrictive covenants of the Trusteeship that would require the Eichlers to remove the brush piles and mobile home camper from the adjoining property. The trial court dismissed the Larabees' lawsuit, finding that the Larabees lacked standing to enforce the restrictive covenants because the property owned by them was not within the boundaries of the Trusteeship.
On March 29, 2004, the Larabees brought this action against the Eichlers for misrepresentation. They allege that from the time the agreements were entered into, the Eichlers knew that the representations made regarding the location of the properties as inside the boundaries of Trusteeship were false and that the Larabees would not be able to enjoy the rights and privileges of the Trusteeship. The Eichlers claim the true status was in the recorded warranty deeds, which state, in part:
Lot 403, STERETT CREEK VILLAGE, a subdivision in Benton County, Missouri, according to the recorded plat thereof.
Subject to easements, restrictions and reservations of record, if any.
The above described Lot 403 is hereby made subject to the Trust Indenture and Restrictive Covenants recorded in Book 395, page 267 in the office of the Recorder of Deeds for Benton County, Missouri.3
The property included in the trust indenture and restricted covenants is described as "[t]he South half of the Southwest quarter of Section 28, Township 41 North, Range 22 West of the 5th P.M. in Benton County, Missouri; EXCEPT ..." There follows two exceptions described by metes and bounds. This first exception contains the property owned by the Larabees. The trust indenture and restrictive covenants state that the restrictive covenants are mutually enforceable only between the Trustee and owners of lots covered by the trust indenture instrument.4
The trial court granted the Eichlers' motion for summary judgment on Counts I and II. The trial court found that Count I, which relates to the 1998 Agreement for Lot 403, was untimely and barred by statute of limitations section 516.120(5). The trial court found that the Larabees failed to produce evidence of damages to support Count II, which relates to the 2000 Agreement for Lot 402.
The Larabees claim that the trial court erred in entering judgment in favor of the Eichlers as to Count I because the Larabees did not discover the fraud until the Eichlers began placing the brush piles and mobile home camper on the property adjoining the Larabees. As to Count II, the Larabees contend the trial court erred because sufficient evidence was presented to establish an issue of material fact as to the amount of damages claimed in regards to the purchase of Lot 402.
The standard of review when considering an appeal from summary judgment is essentially de novo. ITT Commercial Finance v. Mid-America Marine, 854 S.W.2d 371, 376 (Mo. banc 1993). Summary judgment is proper when "there is no genuine issue as to any material fact and ... the moving party is entitled to judgment as a matter of law." White v. Zubres, 222 S.W.3d 272, 274 (Mo. banc 2007); Rule 74.04(c)(6).
"A party who moves for summary judgment on the basis of a statute of limitations bears the burden of showing that the statute bars the plaintiff's claims." Id. (quoting Powel v. Chaminade College Preparatory, Inc., 197 S.W.3d 576, 580 (Mo. banc 2006)). Summary judgment is only proper where it is shown that there is no genuine issue of material fact as to when the fraud was discovered or should have been discovered. Taryen Dev., Inc. v. Phillips 66 Co., 31 S.W.3d 95, 103 (Mo. App.2000).
"[A] defending party moving for summary judgment, may `establish a right to judgment by showing ... facts that negate any one of the claimant's elements ...'" Fetick v. American Cyanamid Co., 38 S.W.3d 415, 418 (emphasis in the original). "If the moving party makes a prima facie showing they are entitled to judgment as a matter of law, the non-moving party then has a specific burden: `an adverse party may not rest upon the mere allegations or denials of his pleading, but his response, by affidavits or as otherwise provided in this Rule 74.04, shall set forth specific facts showing that there is a genuine issue for trial.'" Id. (emphasis in the original). The court accords the non-moving party the benefit of all reasonable inferences in the record. ITT Commercial Finance, 854 S.W.2d at 376.
The elements of a cause of action for misrepresentation are set out in Hess v. Chase Manhattan Bank, USA, N.A., 220 S.W.3d 758, 765 (Mo. banc 2007), as
(1) a representation; (2) its falsity; (3) its materiality; (4) the speaker's knowledge of its falsity, or ignorance of its truth; (5) the speaker's intent that it should be acted on by the person and in the manner reasonably contemplated; (6) the hearer's ignorance of the falsity of the representation; (7) the hearer's reliance on the representation being true; (8) the hearer's right to rely thereon; and (9) the hearer's consequent and proximately caused injury. Heberer v. Shell Oil Co., 744 S.W.2d 441, 443 (Mo. banc 1988); see Trimble v. Pracna, 167 S.W.3d 706, 712-13 (Mo. banc 2005) ( denial of JNOV on fraud).
See also M.A.I. 23.05. An action for fraud must be discovered within ten years of the facts constituting the fraud. Once the fraud is discovered, an action must be brought within five years. Section 516.120(5).
"A cause of action for fraud accrues at the time the defrauded party discovered or in the exercise of due diligence should have discovered the fraud." Burr v. Nat'l Life & Accident Ins. Co., 667 S.W.2d 5, 7 (Mo.App.1984). "It is generally held that where the facts constituting the fraud appear on the face of a record deed, the record of the deed furnishes constructive notice of the fraud so as to set the statute of limitations in motion." Briece v. Bosso 158 S.W.2d 463, 468 (Mo. App.1942). The real estate contracts and deeds presented to the Larabees represented that Lot 402 and Lot 403 were in Sterett Creek Village. The Eichlers claim that the true rights and privileges accorded to Lot 403 was discoverable in the records maintained by the Benton County recorder of deeds and that the Larabees were subject to constructive notice of the same at the time of purchase.
This Court discussed the purpose of our system of recording interests in real estate relative to the statute of limitations and issues of constructive notice in Dreckshage v. Community Fed. Sav. and Loan Ass'n, 555 S.W.2d 314, 319-20 (Mo. banc 1977). Quoting from W.W. Allen, Annotation, Public Records As Notice Of Facts Starting Running Of Statute of Limitations Against Action Based On Fraud, 137 A.L.R. 268, 276 (1942), this Court noted:
...
To continue reading
Request your trial
-
In re Gen. Motors LLC Ignition Switch Litig.
...States, when Missouri law is concerned with "value" as a measure of damages, value refers to market value. See Larabee v. Eichler , 271 S.W.3d 542, 548 (Mo. 2008) (en banc) ("[The] ‘benefit of the bargain’ rule[ ] ... states the appropriate measure for damages in a fraudulent misrepresentat......
-
Gannon Int'l v. Blocker
...being true; (8) the hearer's right to rely thereon; and (9) the hearer's consequent and proximately caused injury. Larabee v. Eichler, 271 S.W.3d 542, 546 (Mo. 2008)(citing Hess v. Chase Manhattan Bank, USA, N.A., 220 S.W.3d 758, 765 (Mo. banc 2007)). Plaintiffs allege two different causes ......
-
Renaissance Leasing LLC. v. Vermeer Mfg. Co.
...when there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Larabee v. Eichler, 271 S.W.3d 542, 545 (Mo. banc 2008); Rule 74.04(c)(6). A defending party moving for summary judgment may establish a right to judgment by showing facts......
-
Brian v. David (In re Davenport)
...between the fair market value of the property received and the value if the property had been as represented. Larabee v. Eichler, 271 S.W.3d 542, 548 (Mo.2008) (citing Heberer v. Shell Oil Co., 744 S.W.2d 441, 443 (Mo.1988)). See also Norber v. Marcotte, 134 S.W.3d 651, 661 (Mo.Ct.App.2004)......