Thomas v. Finger
| Decision Date | 21 December 1999 |
| Docket Number | No. 97–843.,97–843. |
| Citation | 144 N.H. 500,743 A.2d 1283 |
| Court | New Hampshire Supreme Court |
| Parties | Robert J. THOMAS v. George R. and Priscilla A. FINGER. |
Gerald F. Giles, of Portsmouth, by brief and orally, for the plaintiff.
Marc A. Pinard, of Bedford, by brief and orally, for the defendants.
The sole question presented by this appeal is whether the Trial Court (McHugh , J.) abused its discretion in denying plaintiff Robert J. Thomas' motions for directed verdict and to set aside the jury verdict in favor of the defendants, George R. and Priscilla A. Finger. The defendants were found to be bona fide purchasers for value (BFPs) of real estate, and thus not subject to the plaintiff's statutory lien for labor and materials. We affirm.
This case was previously before us. See Thomas v. Finger , 141 N.H. 134, 679 A.2d 567 (1996). The plaintiff appealed an order of the Superior Court (Coffey , J.) which denied him an evidentiary hearing to determine whether the defendants were BFPs of certain improved land in Bedford. Holding that the trial court abused its discretion by conducting a contested hearing on offers of proof over the plaintiff's objection, we remanded the case for a full evidentiary hearing. On remand, following a two-day trial, the defendants were found to be BFPs. The plaintiff now appeals the trial court's denial of his motions for directed verdict and to set aside the jury verdict.
Viewed in the light most favorable to the defendants, the following facts were adduced at trial. In early March 1994, the Fingers moved to New Hampshire from Vermont. On the recommendation of a local real estate broker, they hired builder Dennis McKenna to be the general contractor for the construction of their home on Hickory Lane in Bedford. McKenna agreed to sell them the lot and a substantially completed home for $131,118. As general contractor, McKenna hired all subcontractors to work on the project. At McKenna's request, the Fingers advanced $44,000 of the purchase price. McKenna executed a promissory note to the Fingers and gave them a second mortgage on the property. McKenna granted a first mortgage to a third party for $95,000.
Construction on the home began in May 1994. McKenna hired the plaintiff, a well driller, to install an artesian well on the property, which he completed in late June. Although Thomas submitted a bill for $4,480, McKenna never paid it and Thomas never sent it to the Fingers. The Fingers closed on the property on August 8, 1994. In early October 1994, Thomas secured and recorded an ex parte attachment against the property to perfect his statutory lien for labor and materials. See RSA 447:2 (1991). The Fingers, in turn, moved to vacate the attachment, arguing, in part, that they were BFPs and thus not subject to the lien because they took title to the Hickory Lane property without actual or constructive notice of the plaintiff's claim.
The Fingers have no prior experience in real estate development and have never engaged in the construction business or been involved with general contracting. They did not hire a lawyer to assist them in their transactions with McKenna and relied on their mortgage company to conduct a title search prior to closing for any encumbrances on the property. During the course of construction, the Fingers visited the site on several occasions to ensure that the subcontractors were working and that no problems existed. At no time during their several conversations with the subcontractors were they informed that McKenna was not paying bills in a timely fashion.
At the closing in August, the Fingers reviewed and signed numerous documents that the closing agent for the mortgage company briefly summarized for them. Among them was an Owner's Affidavit signed by McKenna declaring that (1) all work on their house was completed more than 120 days prior to the date of the closing, (2) all bills for labor and materials used in the construction were paid, and (3) no outstanding claims, bills, attachments, petitions for attachment, liens, or pending suits of any kind existed.
In fact, there were unpaid bills and encumbrances clouding title to the property. McKenna had defaulted on several promissory notes to DDM Realty Trust (DDM) involving unrelated activities, and his real estate was subject to a $110,000 attachment. DDM, however, provided a partial discharge of the attachment at the August closing to release the Hickory Lane property. McKenna also identified at the closing outstanding debts of approximately $34,000 to two subcontractors who furnished labor and materials for the Fingers' home. These debts were included in the HUD Settlement Statement used at the closing and were to be discharged from the closing proceeds. Finally, the $44,000 promissory note in favor of the defendants had not been paid by mid-July as promised and was in default. The Fingers, however, received full credit for this advance at the closing.
The plaintiff concedes that he had no proof that the Fingers had actual notice of his unpaid bill prior to closing, but argues that the record clearly established that the defendants had constructive notice of his lien for labor and materials. Specifically, he asserts that the Owner's Affidavit contained conspicuous falsehoods which should have alerted the Fingers that McKenna's representation that all debts had been paid was not trustworthy. Consequently, the plaintiff argues, the Fingers could not have been BFPs. "A bona fide purchaser for value is one who acquires title to property for value, in good faith, and without notice of competing claims or interests in the property." Finger , 141 N.H. at 137, 679 A.2d at 569. The defendants bear the burden of establishing their BFP status. See id . at 138, 679 A.2d at 569.
Before addressing the merits of the plaintiff's appeal, we first consider the appropriate standards of review.
A trial court may grant a directed verdict only when the evidence and all reasonable assertions therefrom, construed most favorably to the party opposing the motion, would not enable a jury to find for that party.... [I]f the evidence is conflicting or several reasonable inferences may be drawn, the motion for a directed verdict should be denied.... Our standard of review on this issue is whether the trial court abused its discretion.
Laramie v. Sears, Roebuck & Co ., 142 N.H. 653, 656, 707 A.2d 443, 444–45 (1998) (quotation and citation omitted). In ruling on a motion to set aside a jury verdict, the trial court must decide whether the verdict was reasonable in light of the evidence. See Johnston v.
, 133 N.H. 79, 85, 574 A.2d 934, 938 (1990). Again, we will not reverse the trial court's ruling absent an abuse of discretion. See
id .
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