Timm v. Neiuwland, 980147
| Decision Date | 12 November 2000 |
| Docket Number | 980147 |
| Citation | 990 P.2d 942 |
| Parties | This opinion is subject to revision before final publication in the Pacific Reporter. Louis L. Timm, John Neiuwland, and Floyd M. Childs, et al., Plaintiffs and Appellants, v. T. Lamar Dewsnup and Aletha Dewsnup, Defendants and Appellees.1999 UT 105 IN THE SUPREME COURT OF THE STATE OF UTAH FILED: |
| Court | Utah Supreme Court |
The Honorable Fred D. Howard
Attorney: Michael Z. Hayes, Todd J. Godfrey, Salt Lake City, for plaintiffs
Russell A. Cline, Salt Lake City, for defendants
1 This case is before us for the third time. We restate only those facts which are pertinent to the issues raised on this appeal. For a complete statement of facts, we refer the reader to our previous opinions, Timm v. Dewsnup, 851 P.2d 1178 (Utah 1993) (Timm I), and Timm v. Dewsnup, 921 P.2d 1381 (Utah 1996) (Timm II).
2 In June of 1978, defendant Aletha Dewsnup and her husband, now deceased, executed three promissory notes totaling $119,000 to the plaintiffs. The notes were secured by a trust deed in favor of the lenders on the 160-acre Dewsnup farm, together with its water rights, and on 56.7 acres of land in Oak City, Utah (collectively the "trust deed property"). Additionally, the notes were secured by an assignment of a contract wherein the Dewsnups were purchasing certain other real property in Millard County ("the Arrow contract").
3 On January 2, 1980, the Dewsnups failed to make an annual installment payment due under the Arrow contract; they also failed to pay the 1979 property taxes on the Arrow property. The lenders subsequently made the delinquent installment payment in the sum of $47,880.50 and paid the property taxes in the amount of $2,085.71 pursuant to that right given them in the assignment of contract to protect their security. Thereafter, the lenders asserted that the Dewsnups owed them $49,966.21 in addition to the $119,000 in promissory notes. On June 1, 1980, the Dewsnups defaulted on the promissory notes.
4 On September 15, 1980, the lenders filed this action against the Dewsnups and other individuals with an interest in the Dewsnups' property seeking a judgment on the promissory notes and to determine the Dewsnups' respective rights and priorities in the Arrow property and for an order of sale of that property. In December of 1980, while this action was pending, the Dewsnups paid the lenders the principal and interest due on the $119,000 notes. On April 14, 1981, the trial court granted summary judgment in favor of the lenders for $49,966.21, plus interest, together with $53.50 for court costs and $6,985 for collection costs, including attorney fees. The trial court additionally held that these amounts were secured by the assignment of contract and by the trust deed property.
5 The Dewsnups then sought relief in bankruptcy proceedings which consumed about ten years' time. Finally, on January 22, 1991, after Mr. Dewsnup's death, Mrs. Dewsnup moved to reconsider the April 1981 summary judgment on two grounds, one of which was that the $49,966.21 due under the Arrow contract was not secured by the trust deed as recited in the summary judgment. She also moved to amend a counterclaim she and her husband had filed to assert new claims against the lenders and to renew claims against their former attorneys. The trial court denied both motions. On appeal to this court, we remanded the case to the trial court directing it to address the merits of Dewsnup's motion to reconsider the summary judgment and her motion to amend her counterclaim. Timm I.
6 On remand, Dewsnup again contended that the summary judgment should be reconsidered because the $49,966.21 due under the Arrow contract was not secured by the trust deed as erroneously recited in the summary judgment. Dewsnup further asserted that she should be allowed to amend her counterclaim on the basis of this court's liberal interpretation of Utah Rule of Civil Procedure 15a. The trial court again denied both motions.
7 On a second appeal to this court, we held that the trial court erred in concluding that the $49,966.21 was secured by the trust deed. We held that the trust deed property secured payment only of the $119,000 promissory notes. We remanded the case to the trial court to grant Dewsnup's motion to reconsider the summary judgment and to determine "what amount, if any, remained outstanding on the promissory notes." Timm II, 921 P.2d at 1394. We also reversed the denial of Dewsnup's motion to amend her counterclaim to assert new claims against the lenders. Id.
8 In Timm II, we noted that "it cannot be determined from the record if and when the lenders conducted a sale on the property subject to the trust deed." 921 P.2d at 1386 n.4, 1392 n.6. Consequently, we stated that in the event Dewsnup prevails on her amended counterclaim against the lenders for damages or for reconveyance of the trust deed property, the possibility of reconveyance depends upon whether such property was sold to a bona fide purchaser or whether the property was sold to one who had actual or constructive notice of the pending litigation. We held that the determination of whether the trust deed property was sold to a bona fide purchaser, or to a purchaser with actual or constructive notice of the litigation, involved questions of fact which must be determined upon remand.
9 In fact, the lenders had conducted a nonjudicial foreclosure sale of the trust deed property on April 29, 1994, while the parties were litigating what amounts were secured by the trust deed. According to the lenders' answers to Dewsnup's interrogatories, the foreclosure sale was to recover $222,814.62 Dewsnup allegedly owed them. The lenders broke down that amount as follows:
1. $166,835.56, composed of the $49,966.21 payment made by the lenders on the Arrow contract, plus $116,869.35 in post judgment interest thereon.
2. $43,545.30 in costs and attorney fees...
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