Steen v. Colombo, 16550

• Decision Date: 12 October 1990
• Docket Number: No. 16550,16550
• Parties: Thomas D. STEEN and Loretta F. Steen, Plaintiffs-Respondents, v. Mario COLOMBO and Elizabeth Colombo, Defendants-Appellants, and Bank of Iberia, Intervenor-Respondent.
• Court: Missouri Court of Appeals

Page 169

799 S.W.2d 169

Thomas D. STEEN and Loretta F. Steen, Plaintiffs-Respondents, v. Mario COLOMBO and Elizabeth Colombo, Defendants-Appellants and Bank of Iberia, Intervenor-Respondent.

No. 16550.

Missouri Court of Appeals,

Southern District,

Division Two.

Oct. 12, 1990.

Motion for Rehearing or Transfer

to Supreme Court Denied Nov. 2, 1990.

Application to Transfer Denied Dec. 18, 1990.

James W. Gallaher, Carson & Coil, P.C., Jefferson City, for defendants-appellants.

John R. Lewis, Springfield, for plaintiffs-respondents.

William C. Morgan, Waynesville, for intervenor-respondent.

HOGAN, Judge.

Defendants Mario and Elizabeth Colombo appeal from a decree of the Circuit Court of Camden County quieting the title to a tract of land in plaintiffs Thomas D. and Loretta F. Steen. We affirm.

One aspect of this controversy has been before this court, see Steen v. Colombo, 722 S.W.2d 648 (Mo.App.1987), although this appeal is not, strictly speaking, a second appeal. Unfortunately, a rather extensive recital of the background facts is necessary to an understanding of the rationale of the opinion.

I

A

At issue is the title to two lots which are part of Cornett Cove No. 5, a subdivision in Camden County, Missouri. In March 1984, plaintiffs Thomas and Loretta Steen purchased Lot 1110 for $27,500. The findings of fact of record on the first appeal ¹ recite that the Steens thereafter entered into possession of a tract of land they believed to be Lot 1110, cleared the tract and began to construct a dwelling on it. It was further found that in determining the location of the lot they believed to be Lot 1110, the Steens relied on the boundary markers placed by the subdivision developer and the broker through whom they purchased the lot. The trial court also found as a fact that the developer had erroneously placed the boundary markers on which the Steens had relied and that the Steens were not negligent in relying on the boundaries marked by the developer or the representations made by the broker who sold them the lot. In any event, in July 1984 the plaintiffs were notified that the lot they were improving was Lot 1111, which was owned by the Colombos, not Lot 1110 which the plaintiffs had purchased. The lots are adjoining lots, substantially the same size and configuration.

Upon the first trial, plaintiff Thomas Steen testified that "including interest" he had spent $81,101.33 improving the lot he believed to be his. He also testified on the first trial that, having discovered he was improving the wrong lot, he approached defendant Mario Colombo and offered "to make some kind of a settlement--trade lots or do something." Colombo declined. Colombo acknowledged that Steen had suggested "we should swap lots," but "it wasn't that simple" because he, Colombo, "still had a note on the lot." The parties were unable to resolve their differences and the Steens filed suit. The petition, as we noted on the prior appeal, asked for a declaration of the rights of the parties, and further requested that if the court should determine that defendants Colombo had title to Lot 1111 and a right to possession, the Steens be compensated for the value of the improvements they had placed on the lot, and that, if such value was greater than the value of Lot 1111, the defendants be compelled to convey the lot to the plaintiffs upon plaintiffs' payment of the value of the lot to defendants Colombo. The defendants filed an answer which, as we noted on the first appeal, was in the nature of a general denial. However, with leave of court and on September 16, 1985, the defendants undertook to amend their responsive pleading so as to state two affirmative counterclaims against the plaintiffs. On October 16 these counterclaims were stricken on plaintiffs' motion. No affirmative counterclaim by defendants Colombo was before the court when the cause was called for hearing.

Evidence was heard on two occasions, first on October 16, 1985, and again on November 13, 1985. Findings of fact and conclusions of law were specifically requested, and those findings and conclusions, together with a judgment, were entered and filed on December 27, 1985. Noting that no counterclaim was then before the court, the trial court concluded, among other things, that the plaintiffs should be permitted to tender the sum of $32,000 within 60 days of the entry of the decree, and that the defendants should, within 60 days of the tender, execute and deliver to the plaintiffs a deed and such other instruments as were necessary to convey marketable title to Lot 1111 to the plaintiffs. It was provided that the judgment should be interlocutory for such time as was necessary for the parties to execute the judgment and for such further time as might be necessary to enforce the judgment if the provisions thereof were not complied with.

Both parties moved the court to amend its judgment, as permitted by Rule 73.01(a)(3). ² Defendants Colombo combined their motion to amend judgment with a motion for new trial and prayed the court to hear further evidence pursuant to Rule 78.01. On March 11, 1986, attorneys for the defendants stated in open court that the defendants would not tender a warranty deed even if plaintiffs tendered payment as required by the decree. The court's judgment was amended to incorporate the findings of fact and conclusions of law previously made, and defendants Colombo were ordered to execute and deliver to the plaintiffs a warranty deed conveying a marketable title to Lot 1111. It was ordered that the plaintiffs simultaneously pay the defendants the sum of $32,000, less any indebtedness outstanding against the lot, and that plaintiffs hold the defendants harmless on that obligation.

B

This appeal is focused upon the effect of the parties' execution of the modified decree. In this connection, it should be understood that after our mandate was filed in the circuit court, the Bank of Iberia moved to intervene and was allowed to do so. A good many motions of one sort or another were filed, but eventually and on November 17, 1987, the defendants were allowed to file an amended counterclaim against the plaintiffs and a crossclaim against the Bank of Iberia. The Bank of Iberia was also permitted to file a counterclaim and crossclaim, and responsive pleadings were filed by the plaintiffs. These counterclaims and crossclaims were later amended but the trial court's docket entry of March 30, 1989, reflects that the trial we now review was a trial of pending counterclaims and crossclaims in the nature of an action to quiet title. Indeed, the court began this trial by asking whether "... this is a hearing on pending counterclaims and crossclaims all of which are in the nature of quit [sic] title actions." Counsel for the defendants and for the intervening defendant, the Bank of Iberia (the bank), answered affirmatively. The trial court heard evidence and thereafter entered a decree quieting title to Lot 1111 in plaintiffs Thomas D. Steen and Loretta F. Steen, subject to a deed of trust dated April 15, 1986, securing payment of a promissory note bearing the same date. The court also exercised its discretion pursuant to Rule 74.01, expressly determining that there was no just reason to delay entry of a judgment on the counterclaims and crossclaims and further determining that its judgment should be regarded as final for purposes of appeal, as permitted by Rule 74.01(b). ³

Nonetheless, and to reiterate, on trial and on this appeal the parties have been almost entirely concerned with the action taken by the defendants in complying with the order entered on the first trial. This action was taken before the notice of appeal was filed on the first appeal, but we are obliged to consider it.

The defendants' attorney, Mr. Donald Schreimann, asked his clients to come to his office after he was advised of the terms of the amended decree the trial court proposed to enter on March 18, 1986. According to Schreimann, he and the defendants discussed "the fact that [defendants] had to deliver a warranty deed free and clear of all encumbrances which would include an existing deed of trust that was due and owing to [the developer]." Therefore, when plaintiffs delivered the check for $32,000, it would be necessary to use that money to pay the existing deed of trust so the defendants could convey title free of all encumbrances. ⁴ Schreimann testified that he got on to the idea, as he put it, that it was necessary to deliver an unconditional warranty deed conveying Lot 1111 to the plaintiffs, at the same time preserving the defendants' right of appeal. Schreimann and his clients, according to Schreimann, "reviewed the idea of a supersedious [sic] bond and also ... the idea of a notice of lis pendens." Schreimann had the opinion that a notice of lis pendens would "notify the world" that the judgment was being appealed and that the deed was being delivered "subject to the appeal." The defendants therefore executed a warranty deed conveying Lot 1111 to the plaintiffs and left it in Schreimann's possession. The deed is before us as defendants' exhibit 8. It is unconditional except for a recitation that it is subject to an indenture dated March 10, 1971, and the easements, restrictions and conditions incorporated in the plat. The deed is dated March 15, 1986.

On April 15 or 16, plaintiff Thomas Steen came to Mr. Schreimann's office. Plaintiffs' attorney had asked for some sort of guarantee that "the title was going to be clear" and Schreimann had had a title insurance company issue a title commitment. Two title insurance commitments were issued. The one before the court was issued to the bank. It shows the title to Lot 1111 to be vested in defendants Colombo, subject to a deed of trust in favor of Four Seasons Lakesites, Inc. Schedule B, Section 2, recited fifteen exceptions to which the commitment was subject. The fifteenth exception is that the policy would be "Subject to appeal of...