Elite Legacy Corporation v. Schvaneveldt
2016 UT App 228
Utah Ct. App.2016Background
- Sellers (Charles Schvaneveldt, Cathy Code, and Still Standing Stable LLC) contracted to sell 170 acres; Aspenwood Real Estate (doing business as Re/Max Elite), agent Tim Shea, and related entities/individuals (Plaintiffs) claim a brokerage commission under a For Sale By Owner Commission Agreement (FSBO) signed by Shea and Sellers.
- A Real Estate Purchase Contract (REPC) was signed by Sellers and Buyers; closing failed because no title insurer would guarantee access to the land and Sellers declined to convey by general warranty deed as required by the REPC.
- Plaintiffs sued for the commission; pretrial, Plaintiffs moved for summary judgment that a commission was earned when Sellers accepted an offer (the signed REPC). The court granted that motion and later a jury found Schvaneveldt (not Still Standing) liable; the court increased the award to the full 3% commission and entered judgment including fees and interest.
- Post-trial, Schvaneveldt filed Rule 60(b) motions arguing Plaintiffs lacked capacity/standing because the assumed name "Re/Max Elite" was registered to Dale Quinlan (not Plaintiffs/Aspenwood), and thus Plaintiffs could not sue under the Assumed Name Statute; Quinlan later reasserted a claim to the dba and transferred it away.
- The trial court denied the Rule 60(b) motions as untimely and otherwise without merit. On appeal, the court considered (1) whether the Rule 60(b) denial was erroneous, (2) whether summary judgment that a commission was earned was erroneous, and (3) whether Schvaneveldt was personally liable or only liable in a representative capacity.
Issues
| Issue | Plaintiff's Argument (Schvaneveldt) | Defendant's Argument (Plaintiffs) | Held |
|---|---|---|---|
| Whether Rule 60(b) relief was required because Plaintiffs lacked capacity under the Assumed Name Statute (making judgment void) | Quinlan (registered owner of dba) was the only party with capacity; post-trial evidence shows Quinlan owned the dba so Plaintiffs lacked capacity and judgment is void | Plaintiffs had capacity (Aspenwood/owners in fact used dba); dba evidence was untimely; failure to comply with Assumed Name Statute affects capacity (affirmative defense), not subject-matter jurisdiction | Denied: failure to comply with Assumed Name Statute affects capacity, not jurisdiction; judgment not void; trial court did not abuse discretion denying Rule 60(b) relief |
| Whether Plaintiffs earned a commission as a matter of law (grant of partial summary judgment) | Commission not earned as matter of law; issues exist whether buyer was ready, willing, and able; whether seller default occurred | FSBO contract triggers commission when seller "accepts an offer" or if seller defaults; Sellers breached REPC by refusing general warranty deed and failure to insure access caused sale to fail, triggering commission | Affirmed: commission earned—Sellers breached REPC by refusing required general warranty deed and failing to guarantee access; seller default made fee immediately due |
| Whether Schvaneveldt is personally liable vs. only liable as an LLC representative | Schvaneveldt signed as member/representative of Still Standing and thus cannot be personally liable | FSBO names Chuck and Cathy as sellers and contains no language showing signing in representative capacity; liability personal unless instrument clearly indicates it is act of principal | Affirmed denial of summary judgment on this point: material documents (FSBO) do not show act was on behalf of LLC; Schvaneveldt could be held personally liable |
| Whether appellate attorney fees are recoverable under the FSBO fee clause | (No separate argument preserved) | Prevailing party below and on appeal entitled to reasonable appellate fees under contractual fee provision | Awarded: Plaintiffs entitled to reasonable attorney fees on appeal; trial court to determine amount |
Key Cases Cited
- Jackson Constr. Co. v. Marrs, 100 P.3d 1211 (Utah 2004) (standard of review for denial of Rule 60(b) motions and distinction where judgment is void)
- Laub v. South Central Utah Tel. Ass'n, 657 P.2d 1304 (Utah 1982) (Rule 60(b)(6) is residual, to be used sparingly and requires motion within a reasonable time)
- Migliore v. Livingston Fin., LLC, 347 P.3d 394 (Utah 2015) (narrow construction of void-judgment concept; jurisdictional implications)
- Orvis v. Johnson, 177 P.3d 600 (Utah 2008) (standard on review of summary judgment)
- Fairbourn Comm., Inc. v. American Housing Partners, Inc., 94 P.3d 292 (Utah 2004) (general rule: broker earns commission when procuring a ready, willing, and able buyer; parties may contract otherwise)
- Jones v. Barlow, 154 P.3d 808 (Utah 2007) (standing as threshold jurisdictional requirement and its elements)
- Daines v. Vincent, 190 P.3d 1269 (Utah 2008) (an agent is personally liable if he signs in a manner indicating liability is his alone)
- Starley v. Deseret Foods Corp., 74 P.2d 1221 (Utah 1938) (agent must expressly indicate principal to avoid personal liability)
- Lamoreaux v. Black Diamond Holdings, LLC, 296 P.3d 780 (Utah Ct. App. 2013) (equitable Rule 60(b)(5) relief requires highly significant changes in circumstances)