Stenoien v. Stenoien
| Decision Date | 30 July 2014 |
| Docket Number | No. 13–1044.,13–1044. |
| Citation | 855 N.W.2d 201 (Table) |
| Parties | Douglas V. STENOIEN, Lavola Stenoien, Sheryl Stenoien, and Gwendolyn Brown, Plaintiffs–Appellants, v. Gary Stenoien, Lorri Ann Stenoien a/k/a Lorri Ann Reinke, and Tammy Swanson, Defendants–Appellees. |
| Court | Iowa Court of Appeals |
Thomas D. Prickett of Sherrets, Bruno & Vogt, L.L.C., Omaha, Nebraska, for appellants.
Gina C. Badding of Neu, Minnich, Comito & Neu, P.C., Carroll, and Joseph E. Halbur, Carroll, for appellees.
Heard by DANILSON, C.J., and POTTERFIELD and McDONALD, JJ.
This appeal involves a family dispute over farmland. The plaintiffs-husband and wife, Douglas and Lavola1 Stenoien, and their daughters, Sheryl Stenoien and Gwendolyn Brown—appeal from the district court's grant of summary judgment in favor of the defendants—Gary Stenoien, son of Douglas and Lavola; Lorri Ann Stenoien, Gary's wife (also known as Lorri Reinke); and Tammy Swanson, Gary and Lorri's daughter. The district court ruled the petition for equitable enforcement of an oral agreement was barred by the statute of frauds and statute of limitations for oral contracts. This action is not barred by either the statute of frauds or the statute of limitations, and we therefore reverse and remand for further proceedings.
For purposes of the defendants' motion for summary judgment, the following facts were admitted. Douglas sold 226 acres of farmland to third parties (the Johnsons) on July 13, 1998. A provision of the sale was that Douglas had the right to repurchase the real estate at 1998 prices plus ten percent until July 28, 2003. Before and within six months of July 28, 2003, Stenoien family members Douglas, Lavola, Gary, Tammy, Sheryl, Gwendolyn, and Darryl Stenoien,2 had meetings and conversations whereby it was agreed Sheryl and Gary would exercise the repurchase option on behalf of the family with the understanding that all the children of Douglas would end up owning the real estate in equal shares. The plan was that the cash rent obtained from the repurchased land would pay the mortgage and upon the sale of Douglas Stenoien's Shelby County horse ranch, the remaining balance would be paid.
On July 28, 2003, Douglas and the Johnsons entered into an agreement “that the buy back may be done by Doug Stenoien and or his family including the Gary Stenoien family, Sheryl Stenoien, Tammy Stenoien, Darryl Stenoien and or the Gwen Stenoien family.” The date the option could be exercised was extended.
On January 9, 2004, Sheryl signed a real estate mortgage to secure payment for a January 5 loan in the amount of $610,000. Real estate owned by Sheryl adjacent to the property to be repurchased was collateral identified in the mortgage. Present for the loan meeting were Douglas Stenoien, Lavola Stenoien, Sheryl Stenoien, Darryl Stenoien, Gary Stenoien, and Lorri Reinke. The January 5 loan from Farm Credit Services (FCS) was signed by Gary and Lorri.
On January 20, 2004, the 226 acres sold by Douglas was transferred by warranty deed from the Johnsons to Gary D. Stenoien. The deed was recorded.
In March 2010, Gary, Lorri, Sheryl, Lavola, and Douglas signed a rental agreement leasing the acreage to the Johnsons for the crop year 2010–11.
Between 2004 and 2011, there were discussions within the Stenoien family over the balance owing on the mortgage and whether Douglas would sell his Shelby County horse ranch and apply the proceeds to pay off the FCS mortgage. Gary continued to ask if the Shelby County ranch had been sold. On Thanksgiving 2011 during a family get-together, Tammy indicated she and Gary had obtained a lawyer regarding the farm real estate.
On or about December 1, 2011, Douglas had a conversation with Gary in which he inquired about the loan balance on the property. Gary would not share this information with Douglas. Gary stated it was his land. The two have not spoken since. Shortly after the December 1 meeting, Douglas had the warranty deed pulled and discovered only Gary's name was on the deed. There is no evidence the loan balance was paid in full or that Douglas sold his Shelby County horse ranch to apply to the final balance owed.
A March 20, 2012 letter from FCS to Gary and Lorri sets out the fees for their request to release Sheryl's real estate from the mortgage. On May 8, 2012, FCS released the lien on land owned by Sheryl from the mortgage. Sheryl was given no notice of Gary and Lorri's request or of FCS's partial release.
By an amended petition, the plaintiffs added Lorri and Tammy as additional defendants and replied to Gary's counterclaims.
The defendants filed a motion for summary judgment asserting the claims were barred by the statute of frauds, Iowa Code § 622.32(3), and the statute of limitations governing oral contracts, id. § 614.1(4) (2013).3 The plaintiffs asserted neither hindered their claims here.
The district court granted summary judgment in favor of the defendants, and the plaintiffs appeal.
We review a district court's grant of summary judgment for correction of errors of law. Iowa R.App. P. 6.907 ; Osmic v. Nationwide Agribusiness Ins. Co., 841 N.W.2d 832, 858 (Iowa 2014). Summary judgment is appropriate when the record shows no genuine issue of material fact exists and the moving party is entitled to a judgment as a matter of law. Iowa R. Civ. P. 1.981(3). We view the record in the light most favorable to the nonmoving party. See Bierman v. Weier, 826 N.W.2d 436, 443 (Iowa 2013). The burden is on the moving party to establish the existence of undisputed facts entitling that party to a particular result under controlling law. See Hallett Const. Co. v. Meister, 713 N.W.2d 225, 229 (Iowa 2006).
It is important here to note that the defendants' motion for summary judgment asserted there were no factual disputes and the issue was one of law.4 As presented to the district court, this motion for summary judgment was grounded upon the defendants' assertion that as a matter of law any agreement between the family members—because it was oral—was barred by the statute of frauds, or in the alternative, was barred by five-year statute of limitations for unwritten contracts. Consequently, we must view the facts asserted, including those in the plaintiffs' joint affidavit, in the light most favorable to the plaintiffs and determine whether the defendants have established they are entitled to judgment as a matter of law.
The plaintiffs filed a memorandum of authorities arguing the family agreement fell outside the statute of frauds because part of the contract was in writing and they had partly performed. They also argued the statute of limitations had not run because the earliest the breach of the oral contract could have been discovered was on December 1, 2011, when Gary stated he would give Douglas no further information regarding the payments on the contract.
A. Five-year statute of limitations. The defendants admitted the existence of an oral contract for purposes of their motion for summary judgment. Relying on Iowa Code section 614.1(4), the district court concluded the plaintiffs' claim was barred by the statute of limitations for oral contracts. Section 614.1(4) provides that actions “founded on unwritten contracts, those brought for injuries to property, or for relief on the ground of fraud in cases heretofore solely cognizable in a court of chancery” must be brought within five years “after their causes accrue.”5
The defendants argue, relying upon Clark v. Van Loon, 79 N.W. 88, 89 (Iowa 1899), because “the recording of the deed imparts constructive notice of its contents” the plaintiffs' breach-of-contract cause of action accrued when the warranty deed was recorded in January 2004. The district court was convinced, concluding that even assuming there was a valid oral contract, “Breach of the oral contract occurred when Gary recorded the deed to the farmland in his name, if not before.” We believe this fact-finding is premature at this stage in the proceedings,6 see Dallenbach v. Mapco Gas Prod., Inc., 459 N.W.2d 483, 486 (Iowa 1990) (), but more importantly mischaracterizes and unduly narrows the plaintiffs' claim.
As stated in the petition, the plaintiffs asserted the family agreed “Gary and Sheryl, who were in the best financial condition to purchase the property, would repurchase the property on behalf of the family.” The plaintiffs also asserted, “All parties contemplated that the rents from the property would be applied to principal and interest on the loan and once the loan was paid off that title would be in the children equally. ” (Emphasis added.) The plaintiffs further asserted consideration was given on their part and the agreement had been partly performed. In resisting the motion for summary judgment, the plaintiffs argued the “earliest time that the breach could have been discovered [ 7 ] in this action was on December 1, 2011” as they were not aware Gary intended to breach the agreement until Gary indicated in December 2011 that the land was his alone. On appeal, the plaintiffs urge that their petition did not limit the theories of recovery to breach of an oral contract. The incident noted in the petition giving rise to the plaintiffs' claim is Gary's statement in December 2011 ...
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