316 P.3d 303
Or. Ct. App.2013Background
- Plaintiff and defendant were long-term romantic partners; plaintiff paid mortgage, taxes, insurance, maintenance and advanced ~$212,358 to defendant over several years.
- In 2004 plaintiff purchased a Jacksonville, OR property; deed listed both with rights of survivorship. Plaintiff later conveyed her one-half interest to defendant on Feb. 10, 2006, allegedly so defendant could obtain a $96,000 loan; plaintiff contends they orally agreed defendant would reconvey her interest after loan closing.
- Defendant took a loan using the property as collateral, gave plaintiff $26,276, did not reconvey, and sought to sell.
- Plaintiff sued (2008–2009): declaratory relief (ownership/title), fraud (including $212,357.84 damages and half the property value), and unjust enrichment. Defendant moved for summary judgment and to quiet title; trial court granted both motions and entered limited judgment for defendant.
- On appeal the court reviewed summary judgment evidence in the light most favorable to plaintiff and found genuine issues of material fact as to (1) whether the 2006 oral agreement could be enforced via partial performance (statute of frauds), (2) whether plaintiff’s conduct constituted unclean hands, (3) timeliness and merits of the fraud claim, and (4) unjust enrichment. The appellate court reversed and remanded.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the 2006 oral agreement to reconvey plaintiff’s half-interest is enforceable despite statute of frauds (partial performance) | Burgdorf: parties agreed defendant would reconvey after loan; plaintiff’s transfer and continued payments constitute partial performance and equitable grounds for enforcement | Defendant: agreement is ambiguous, tied to marriage/cohabitation or otherwise barred by statute of frauds; plaintiff’s conduct aided a fraudulent scheme on the bank (unclean hands) | Reversed trial court: genuine disputes exist on all three partial-performance elements (clear terms, exclusive referability, equitable grounds); unclean-hands defense not properly resolved on summary judgment |
| Whether plaintiff’s 2006 letter and transfer constituted unclean hands that preclude equitable relief | Burgdorf: letter reflected no present interest (accurate the day she transferred) and was dictated by defendant’s loan officer; she did not intend to defraud the bank | Defendant: plaintiff’s actions were a fraud on the bank; equity should refuse relief | Reversed: material facts exist about plaintiff’s intent and whether invoking unclean hands would work an injustice or whether defendant suffered actual injury from any misconduct |
| Whether fraud claim (misrepresenting intent to move to Oregon to induce loans/payments) is timely and supported by evidence | Burgdorf: she discovered misrepresentations in June 2008 and filed within two years (claim filed Mar. 2009); affidavits show defendant never intended to move and lied to induce payments/transfers | Defendant: plaintiff should have discovered fraud earlier; no evidence defendant knew falsehoods at inception or intended fraud; nonperformance alone insufficient to infer intent | Reversed: jury questions exist on discovery date (statute of limitations) and on elements of fraud (representation, falsity, knowledge/intent, reliance, injury); affidavits create triable issues |
| Whether unjust enrichment applies for monies plaintiff advanced and property payments | Burgdorf: she conferred benefit, expected reimbursement (affidavit), and it would be unjust to allow defendant to retain it | Defendant: plaintiff’s deposition suggested transfers/gifts, not loans; unclean hands bars relief | Reversed: conflicts between deposition and affidavit create genuine issues about expectation of repayment and whether equity should award relief; unclean-hands resolution premature on summary judgment |
Key Cases Cited
- Jones v. General Motors Corp., 325 Or. 404, 939 P.2d 608 (Or. 1997) (summary judgment review standard)
- Mukai Living Trust v. Lopez, 199 Or. App. 341, 111 P.3d 1150 (Or. Ct. App. 2005) (partial-performance doctrine elements)
- North Pacific Lumber Co. v. Oliver, 286 Or. 639, 596 P.2d 931 (Or. 1979) (unclean hands doctrine limits)
- Taylor v. Grant, 204 Or. 10, 279 P.2d 479 (Or. 1955) (unclean hands and when equity will deny relief)
- Welsh v. Case, 180 Or. App. 370, 43 P.3d 445 (Or. Ct. App. 2002) (limitations on unclean hands application)
- Webb v. Clark, 274 Or. 387, 546 P.2d 1078 (Or. 1976) (elements of fraud)
- Mathies v. Hoeck, 284 Or. 539, 588 P.2d 1 (Or. 1978) (discovery rule for statute of limitations)
- Gaston v. Parsons, 318 Or. 247, 864 P.2d 1319 (Or. 1993) (objective discovery inquiry)
- Tran v. Tehrani, 99 Or. App. 141, 781 P.2d 393 (Or. Ct. App. 1989) (cannot infer fraudulent intent from mere nonperformance)
- Cron v. Zimmer, 255 Or. App. 114, 296 P.3d 567 (Or. Ct. App. 2013) (elements of unjust enrichment)
- Jaqua v. Nike, Inc., 125 Or. App. 294, 856 P.2d 442 (Or. Ct. App. 1993) (factors showing unjustness for quasi-contract)
- Henderson-Rubio v. May Dept. Stores, 53 Or. App. 575, 632 P.2d 1289 (Or. Ct. App. 1981) (when affidavit contradicting deposition can create or fail to create a triable issue)
- Holdner v. Holdner, 176 Or. App. 111, 29 P.3d 1199 (Or. Ct. App. 2001) (burden to prove an oral contract by clear, unequivocal preponderance)