Title: Russell v. Atkins

State: vermont

Issuer: Vermont Supreme Court

Document:

Russell v. Atkins  (94-651); 165 Vt 176; 679 A.2d 333

[Opinion Filed 12-Apr-1996]


       NOTICE:  This opinion is subject to motions for reargument under
  V.R.A.P. 40 as well as formal revision before publication in the Vermont
  Reports.  Readers are requested to notify the Reporter of Decisions,
  Vermont Supreme Court, 109 State Street, Montpelier, Vermont 05609-0801 of
  any errors in order that corrections may be made before this opinion goes
  to press.


                            No. 94-651


Robert Russell, et al.                       Supreme Court

                                             On Appeal from
    v.                                       Chittenden Superior Court

David and Betty Atkins                       January Term, 1996


Merideth Wright, J.

Stephen Norman, Vermont Legal Aid, Inc., Burlington, for plaintiffs-appellants

Mark L. Sperry and Eric M. Knudsen of Langrock Sperry & Wool,
  Burlington, and Edwin L. Hobson of Linton & Hobson, Williston, for
  defendants-appellees


PRESENT:  Gibson, Dooley, and Morse, JJ., Martin, Super. J. and
  Levitt, Dist. J., Specially Assigned


       MORSE, J.   Plaintiffs appeal the superior court's grant of summary
  judgment to defendants David and Betty Atkins, owners of the Westbury
  Mobile Home Park, in a landlord/tenant dispute arising out of the proposed
  sale of the Park.  Plaintiffs make three claims on appeal.  In claim I
  plaintiffs seek specific performance of an alleged contract to sell the
  park, claiming that the trial court erred in concluding that no contract
  existed.  In claim II plaintiffs argue that defendants violated 10 V.S.A. §
  6242(c)(2) by failing to negotiate in good faith, and committed unfair and
  deceptive business practices in violation of 9 V.S.A. § 2453(a) by
  threatening to evict tenants who did not arrange for the purchase of their
  mobile home lots under a condominium conversion plan.  Plaintiffs contend
  that the trial court erred in concluding that defendants' conduct did not
  constitute consumer fraud.  In claim III plaintiff Russell, in a separate
  cause of action, argues that defendants committed an unfair business
  practice when they agreed to lease a lot to him only on the condition that
  he buy a mobile home from them.  He contends that the trial court erred in
  dismissing his claim.  We dismiss claim I, affirm claim II,

 

  and reverse the grant of summary judgment in claim III.

       Plaintiffs are current or former tenants of the Park, which contains
  250 lots leased as sites for mobile homes.  Park tenants own their mobile
  homes and lease only the sites on which the homes sit.

       In January 1989, defendants gave notice of their intent to sell the
  Park and their asking price as required by 10 V.S.A. § 6242(a) (Supp.
  1989).  Under § 6242(a)(3), as then enacted, an owner who received notice
  that a majority of adult residents were interested in buying the Park,
  could "not make a final unconditional acceptance of an offer to purchase
  the park except one from a resident group representing a majority of the
  adult residents or from a nonprofit corporation approved by a majority of
  the adult residents."  Section 6242(b)(1) obligated the owner to "negotiate
  in good faith with the resident group . . . or a nonprofit corporation . .
  . concerning the purchase of the park."

       The tenants, acting through the Kellogg Woods Homeowners Association,
  gave notice of their interest in purchasing the Park, and approved Housing
  Foundation Inc. (HFI) as their designee nonprofit corporation.  HFI
  tendered a purchase and sale agreement for the full asking price of
  $5,000,000 and a $5000 deposit within the ninety-day period specified in §
  6242(a)(3). The purchase and sale agreement included many terms not
  contained in the notice of intent to sell, including unusual financing
  contingencies.  Defendants returned the contract and deposit promptly to
  HFI and notified the tenants that the Park was no longer for sale.

       In December 1989, defendants gave their tenants a prospectus called a
  "blue book," which described an offer to sell individual lots as
  condominiums for $33,000 each.  Consistent with the Condominium Ownership
  Act, 27 V.S.A. §§ 1301-1339, the offer stated that the tenants could be
  evicted if they did not arrange for the purchase of their lots.  Id. §
  1333(a). The "blue book" also contained an offer to sell the whole property
  to the tenants for $8,000,000 under 10 V.S.A. § 6242(a).  Kellogg Woods
  represented the tenants, who again elected to purchase the Park and gave
  appropriate notice.  During these negotiations, Kellogg

 

  Woods, HFI, and plaintiffs commenced this action in Chittenden Superior
  Court.  Both Kellogg Woods and HFI settled and voluntarily dismissed their
  claims with prejudice.  Only plaintiffs, acting as individuals, have
  pursued this action.  No sales of the Park or any condominium lots have
  taken place.

                                I.

       Plaintiffs first argue that defendants' initial notice of intent to
  sell was an offer, and that HFI's acceptance created an enforceable
  contract.  They seek specific performance of the terms of the first notice,
  or a declaration that defendants abrogated their duty to negotiate in good
  faith under 10 V.S.A. § 6242(c)(2).  We need not reach the merits of this
  issue because plaintiffs' claim is barred by res judicata.

       "The doctrine of res judicata, also known as claim preclusion, bars
  the litigation of a claim or defense if there exists a final judgment in
  former litigation in which the `parties, subject matter and causes of
  action are identical or substantially identical.'"  Berlin Convalescent
  Center, Inc. v. Stoneman, 159 Vt. 53, 56, 615 A.2d 141, 143 (1992) (quoting
  Berisha v. Hardy, 144 Vt. 136, 138,