Lexington Heights Development, LLC v. Crandlemire

• Citation: 140 Idaho 276,92 P.3d 526
• Decision Date: 27 May 2004
• Docket Number: No. 29479.,29479.
• Parties: LEXINGTON HEIGHTS DEVELOPMENT, LLC, a limited liability company, Plaintiff-Appellant, v. Roger C. CRANDLEMIRE and Elizabeth Crandlemire, husband and wife; Blake Mayes, a single man; Corporations 1-5 and Does 1-10, Defendants-Respondents. Roger C. Crandlemire and Elizabeth Crandlemire, husband and wife, Defendants-Counterclaimants-Respondents, v. Lexington Heights Development, LLC, a limited liability company, Plaintiff-Counterdefendant-Appellant.
• Court: Idaho Supreme Court

92 P.3d 526

140 Idaho 276

LEXINGTON HEIGHTS DEVELOPMENT, LLC, a limited liability company, Plaintiff-Appellant, v. Roger C. CRANDLEMIRE and Elizabeth Crandlemire, husband and wife; Blake Mayes, a single man; Corporations 1--10, Defendants-Respondents.

Roger C. Crandlemire and Elizabeth Crandlemire, husband and wife, Defendants-Counterclaimants-Respondents, v. Lexington Heights Development, LLC, a limited liability company, Plaintiff-Counterdefendant-Appellant.

No. 29479.

Supreme Court of Idaho, Boise, May 2004 Term.

May 27, 2004.

Givens Pursley, LLP, Boise, for appellant. David R. Lombardi argued.

Eberle, Berlin, Kading, Turnbow & McKlveen, Chtd., Boise, for respondents Roger and Elizabeth Crandlemire. Warren E. Jones argued.

Law Office of G. Lance Salladay, Boise, for respondent Blake Mayes. G. Lance Salladay argued.

EISMANN, Justice.

This is an appeal from a partial summary judgment holding that a real estate contract is invalid because it did not contain a sufficient description of the property being sold. We affirm the partial summary judgment.

I. FACTS AND PROCEDURAL HISTORY

The respondents Roger and Elizabeth Crandlemire (the Crandlemires) owned a 95-acre parcel of real property, and on February 17, 1999, they entered into a contract to sell approximately ninety acres of that property to appellant, Lexington Heights Development, LLC, (Lexington Heights). The contract described the property being sold as "the real property situated in Ada County, Idaho located at 1400 West Floating Feather Road, consisting of approximately ninety (90) acres ..., however excluding the residential dwelling (which will include no more than five acres) and improvements identified below (herein called `Premises')." The contract provided that the "the precise size, location, dimensions and configuration" of the five-acre parcel excluded from the sale would be determined as follows:

A precise legal description of the Premises will be prepared as a result of an ALTA survey to be obtained by Seller. It is understood and agreed that Seller may sell to a third party the existing residential dwelling situated on the Premises together with no more than five (5) acres immediately surrounding the proposed residential development (which five (5) acres will include the existing tennis court, volleyball court, and swimming pool), the precise size, location, dimensions and configuration of which shall be mutually determined by Seller and Buyer. It is further understood and agreed that within the said excluded five (5) acres, Seller may make available to United Water Corporation a site for a water storage tank provided; however, that all negotiations respecting the location, design, construction and landscaping of the said water storage tank shall be conducted by both parties and any agreement thereon must be approved by both parties.

Lexington Heights was purchasing the property for development, and the purchase price was to be $20,000 per acre if the City of Eagle approved development with a gross density of fewer than two residential dwelling units per acre and $22,500 per acre if the City approved a higher gross density. Lexington Heights paid $300,000 in earnest money, and the Crandlemires executed a deed of trust on the entire property to secure repayment of the earnest money in the event that certain contingencies did not occur. One of those contingencies was that within two years Lexington Heights would receive approval from all necessary governmental agencies permitting development of the property at a density of not less than one residential dwelling per two acres. Under the zoning in existence at the time, residential lots had to be five acres or larger in size.

The property was surveyed on May 4 and 5, 1999, and three legal descriptions were prepared: one for the entire property, one for 4.54 acres to be retained by the Crandlemires, and one for 0.46 acres to be conveyed to United Water Corporation. Mr. Crandlemire personally participated in identifying for the surveyor the five acres he wanted excluded from the sale.

In early 2000, the Crandlemires desired to explore the possibility of selling the five acres they would retain to a third party, who would develop it as a retirement community in connection with Lexington Heights's proposed development. Because exploration of that concept would require that the development be delayed, the parties on October 30, 2000, executed a second real estate contract (the Agreement). The Agreement provided that it "supersedes all prior agreements between the parties hereto, whether in writing or otherwise; and any such prior agreement shall have no force or effect upon the date of execution of this Agreement." The Agreement set the closing on December 31, 2001. Even though legal descriptions had been prepared for the entire property, the property to be retained by the Crandlemires, and the property to be conveyed to United Water Corporation, the Agreement did not use or refer to those legal descriptions to describe the property to be sold. It simply repeated the property description contained in the first contract, including the provision setting forth how the "the precise size, location, dimensions and configuration" of the five-acre parcel excluded from the sale would be determined.

In May 2001, the third party eventually decided not to pursue development of the retirement community, and the respondent Blake Mayes (Mayes) investigated purchasing the five acres from the Crandlemires and an additional two acres from Lexington Heights, once it acquired the ninety acres. In August 2001, Mayes informed Lexington Heights that he would like to purchase ten to seventeen additional acres, but Lexington Heights rejected that proposal. In September 2001, Lexington Heights informed Mr. Crandlemire that its project had been delayed long enough and that it wanted to proceed with the closing. Mr. Crandlemire responded by proposing that the price for the property be increased by $200,000, which Lexington Heights refused to do. The Crandlemires refused to close the sale to Lexington Heights. On January 17, 2002, they sold forty acres of the property to Mayes.

On February 21, 2002, Lexington Heights filed this lawsuit against the Crandlemires and Mayes alleging six causes of action. It sought specific performance of the Agreement; damages for breach of the Agreement; damages for fraud and deception based upon the sale of the forty acres to Mayes; damages for negligence based upon Mayes' conduct in removing signs giving notice of a public hearing to be held on February 19, 2002, in connection with Lexington Heights's proposed development of the property; damages for intentional interference with prospective economic advantage based upon the sale of the forty acres to Mayes; and an order expunging from the public records the deed to Mayes and holding that Mayes and the Crandlemires are estopped from asserting any claim to the ninety acres.

The Crandlemires answered and filed a counterclaim seeking damages for breach of the Agreement and slander of title, forfeiture of the earnest money, and an order expunging from the public records the deed of trust and the recorded Agreement. Mayes also answered and filed a counterclaim seeking damages for slander of title and an order expunging the deed of trust and the recorded Agreement.

On January 6, 2003, Mayes filed a motion to dismiss all of the claims in the complaint on the ground that the Agreement was unenforceable. On January 13, 2003, the Crandlemires moved to dismiss the complaint on the grounds that the Agreement was not enforceable because it lacked mutuality of remedy and/or obligations and because material terms were uncertain, incomplete, and ambiguous. The district court treated these motions as motions for summary judgment. On January 27, 2003, it issued a memorandum decision granting the motions on the grounds that the Agreement was unenforceable because it did not contain a sufficient legal description of the property being sold and because it lacked mutuality of obligation due to the contingencies in the Agreement. The district court granted the motions by memorandum decision entered on January 27, 2003. On February 10, 2003, the district court entered judgment dismissing the complaint. The judgment included a certificate pursuant to Rule 54(b) of the Idaho Rules of Civil Procedure. Lexington Heights timely filed a motion for reconsideration, which the district court denied by memorandum decision entered on March 16, 2003. Lexington Heights then timely appealed.

II. ISSUES ON APPEAL

A. Did the district court err in holding that the real estate contract in this case was invalid because of an insufficient legal description?

B. Did the district court err in refusing to order arbitration?

C. Did the district court err in dismissing all of the claims of Lexington Heights?

D. Are the Crandlemires and Mayes entitled to an award of attorney fees on appeal?

III. ANALYSIS

A. Did the District Court Err in Holding that the Real Estate Contract in This Case Was Invalid Because of an Insufficient Legal Description?

Idaho Code § 9-505 provides:

In the following cases the agreement is invalid, unless the same or some note or memorandum thereof, be in writing and subscribed by the party charged, or by his agent. Evidence, therefore, of the agreement cannot be received without the writing or secondary evidence of its contents:

....

4. An agreement for the leasing, for a longer period than one (1) year, or for the sale, of real property, or of an interest therein....

This portion of the statute has remained unchanged since the Territorial Legislature adopted it in 1881. Almost one hundred years ago, this Court addressed the requirement that a contract for the sale of real property must contain an adequate description of the property to be sold.

In Allen v. Kitchen, 16 Idaho 133, 100 P. 1052 (1909), this Court held invalid a real estate...