2013 UT App 96

_________________________________________________________



### T HE 

### U TAH 

### C OURT OF 

### A PPEALS

S AM A SHWORTH

,

Plaintiff and Appellant,

v.

M URPH B ULLOCK

,

Defendant and Appellee.

Opinion

No. 20120278

‐ CA

Filed April 18, 2013

Fourth District, American Fork Department

The Honorable Christine S. Johnson

No. 110100316

James H. Deans, Attorney for Appellant

Sidney Balthasar Unrau, Attorney for Appellee

J UDGE C AROLYN B. M C H UGH authored this Opinion, in which

J UDGES G REGORY K. O RME and J. F REDERIC V OROS J R

. concurred.

McHUGH, Judge:

¶1 Sam Ashworth appeals the trial court’s declaratory

judgment determining that Murph Bullock and his wife Cecelia

Bullock (collectively, the Bullocks) are the owners of real property

in Payson, Utah (the Property). We affirm.Ashworth v. Bullock

1. “‘On appeal from a bench trial, we view the evidence in a light

most favorable to the trial court’s findings, and therefore recite the

facts consistent with that standard.’” Alvey Dev. Corp. v.

Mackelprang

, 2002 UT App 220, ¶ 2, 51 P.3d 45 (quoting Johnson v.

Higley

, 1999 UT App 278, ¶ 2, 989 P.2d 61).

20120278

‐ CA 2013 UT App 96 2 BACKGROUND 1

¶2 In 1976, Joseph Bates and Rosemary Bates Harris, brother

and sister, held the Property as joint tenants, with right of

survivorship. The Bullocks were living in a home located on the

Property pursuant to a verbal rental agreement with Bates. The

Bullocks had never met Harris and were unaware that she held an

ownership interest in the Property.

¶3 On October 15, 1976, Bates executed a written document (the

Writing), which states,

I Joe Bates am selling my home.

at 346 [West] 300 [South] Payson[, U]tah.

To Murph and Cece Bullock

For $84,000[.]00 to be paid $200.00

a month until the year 2013.

where for it will be paid in full

. 10/15/1976 /s/ Joe Bates

witness /s/ Woody Woodward

Bates read the Writing aloud to Murph Bullock, who is functionally

illiterate, and then signed it. However, Harris never signed the

Writing and neither the Bullocks nor Bates ever recorded the

Writing or any other document indicating that the Bullocks claimed

an interest in the Property. In May 1977, nearly seven months after

Bates executed the Writing, Harris died.

¶4 The Bullocks still reside on the Property and have made the

monthly payments specified in the Writing for over thirty years.

The Bullocks have also contributed $800 each year to the propertyAshworth v. Bullock

20120278

‐ CA 2013 UT App 96 3 taxes. However, title to the Property remained in Bates’s name and

the Bullocks have never claimed a tax deduction related to the

Property. The Bullocks have maintained renter’s insurance on the

residence rather than an owner’s insurance policy, but they have

made significant repairs and improvements to the Property.

¶5 When Bates died in October 2010, Ashworth was appointed

as the personal representative of the estate. Assuming that the

Property was part of the estate, Ashworth instructed a property

manager to contact the Bullocks for the purpose of obtaining a

written rental agreement. The Bullocks refused to enter into a

rental agreement, instead claiming that they were purchasing the

Property from Bates.

¶6 On May 2, 2011, Ashworth filed a complaint against Murph

Bullock for unlawful detainer. Bullock responded with an answer

and a motion to dismiss the complaint. At a hearing on the motion

to dismiss, the parties stipulated that the motion be denied and that

the matter be set for a bench trial. At trial, Ashworth indicated that

the estate no longer sought eviction under the unlawful detainer

statute. Instead, the estate requested a declaratory judgment

“regarding the rights of the parties with respect to the Property.”

The trial court ruled that Ashworth’s motion was appropriate

because the evidence at trial “focused on the issue of determining

the nature of the agreement between Bates and the Bullocks.”

Accordingly, the trial court conformed the pleadings to the

evidence and rendered a declaratory judgment on the effect of the

Writing.

¶7 The trial court first ruled that “Harris’ signature was

unquestionably necessary on the [Writing] when it was executed

in 1976.” As a result, it determined that the Writing had not

ripened into a contract at the time it was executed. However, the

trial court also concluded that “upon Harris’ death, the [Writing]Ashworth v. Bullock

2. The trial court’s equivocation that the Writing is “arguably” a

contract was due to an additional argument advanced by

Ashworth that the Writing was too indefinite to create a contract.

The trial court ultimately resolved that issue in favor of the

Bullocks, and Ashworth has not appealed that determination.

20120278

‐ CA 2013 UT App 96 4 ripened into what can be argued is an enforceable contract.” 2

Accordingly, the trial court ruled that the Bullocks had purchased

the Property and that Ashworth was not entitled to relief under the

unlawful detainer statute. Ashworth filed a timely appeal.

ISSUE AND STANDARD OF REVIEW

¶8 Ashworth argues that the Writing attempting to sell the

Property to the Bullocks is void and unenforceable under the

statute of frauds and therefore conveyed nothing to the Bullocks.

“The applicability of the statute of frauds is a question of law to be

reviewed for correctness.” Bennett v. Huish

, 2007 UT App 19, ¶ 25,

155 P.3d 917 (citation and internal quotation marks omitted).

ANALYSIS

¶9 Ashworth agrees with the trial court that the Writing was

void and unenforceable under the statute of frauds when executed

by Bates. However, he contends that the trial court erred in

concluding that the Writing ripened into an enforceable contract

upon Harris’s death. In order to resolve this issue, we must

consider the effect of the Writing and Harris’s death on the

ownership of the Property.

I. The Writing Was Not an Enforceable Contract when Executed

by Bates.

¶10 The trial court correctly noted that “Utah courts have, over

the years, consistently determined that the Statute of FraudsAshworth v. Bullock

3. Utah’s statute of frauds provides,

No estate or interest in real property, other than

leases for a term not exceeding one year, nor any

trust or power over or concerning real property or in

any manner relating thereto, shall be created,

granted, assigned, surrendered or declared otherwise

than by act or operation of law, or by deed or

conveyance in writing subscribed by the party

creating, granting, assigning, surrendering or

declaring the same, or by his lawful agent thereunto

authorized by writing.

Utah Code Ann. § 25

‐ 5

‐ 1 (LexisNexis 2007).

20120278

‐ CA 2013 UT App 96 5 requires the signature of both owners for the transfer of real

property held in joint tenancy.” 3 See, e.g.

, Krantz v. Holt

, 819 P.2d

352, 353 (Utah 1991) (“If [ex

‐ husband] retained a joint interest in the

property, his written consent to the property’s sale would be

necessary, not because of any clause in the agreement, but because

the Utah statute of frauds so requires.”); Williams v. Singleton

, 723

P.2d 421, 423 (Utah 1986) (per curiam) (“One joint tenant or tenant

in common cannot bind his cotenant by a contract which he may

make relating to the common property.”); Centennial Inv. Co. v.

Nuttall

, 2007 UT App 321, ¶ 10, 171 P.3d 458 (“[W]hen real

property is held in joint tenancy, the signature of both owners is

necessary to satisfy the Utah statute of frauds.”). In this case, Harris

did not execute the Writing and therefore, no enforceable contract

was formed in 1976. See Krantz, 819 P.2d at 353; Williams

, 723 P.2d

at 423; Centennial Inv.

, 2007 UT App 321, ¶ 10.

II. The Writing Did Not Sever the Joint Tenancy.

¶11 The status of the joint tenancy at the time of Harris’s death

is relevant because it determines who became the owner of Harris’s

interest in the Property. If the joint tenancy remained in effect at

that time, Harris’s interest passed by law to Bates. See generally

Shiba v. Shiba

, 2008 UT 33, ¶ 17, 186 P.3d 329 (holding that both

parties to a joint tenancy “hold a concurrent ownership in the sameAshworth v. Bullock

20120278

‐ CA 2013 UT App 96 6 property with a right of survivorship, i.e., each [tenant] is afforded

the eventuality of a full ownership interest, conditioned upon the

tenancy remaining unsevered, and one out

‐ living the other”

(citation and internal quotation marks omitted)); see also In re Estate

of Ashton

, 898 P.2d 824, 826 (Utah Ct. App. 1995) (reversing the

district court’s inclusion of property in the deceased’s estate that,

at the time of his death, was held in joint tenancy with full right of

survivorship). If, on the other hand, Bates’s attempt to convey the

Property to the Bullocks severed the joint tenancy, he and Harris

held the Property as tenants in common at the time of Harris’s

death. See Utah Code Ann. § 57

‐ 1

‐ 5(5)(a) (LexisNexis Supp. 2012)

(“[I]f a joint tenant makes a bona fide conveyance of the joint

tenant’s interest in property held in joint tenancy to himself or

herself or another, the joint tenancy is severed and converted into

a tenancy in common.”). When a tenant in common dies, that

tenant’s interest in the property passes to her heirs, rather than to

the other tenants in common. See Webster v. Lehmer

, 742 P.2d 1203,

1205 (Utah 1987) (explaining that the deed created a tenancy in

common, not a joint tenancy, and that therefore, “when [the tenant

in common] died intestate in 1975, her interest, instead of passing

solely to [the other tenant in common], passed by the rules of

intestate succession to [the deceased tenant’s] two daughters”).

Thus, if the Writing severed the joint tenancy, it was converted to

a tenancy in common and Harris’s interest passed to her heirs. See

Shiba

, 2008 UT 33, ¶ 17.

¶12 When a joint tenant conveys “his interest therein by a valid

deed,” he “‘severs and terminates the joint tenancy by the creation

of a tenancy in common.’” Id. (quoting Tracy

‐ Collins Trust Co. v.

Goeltz

, 301 P.2d 1086, 1090 (Utah 1956)). However, such a

conveyance by valid deed does not convey the entire property

because a joint tenant may not “dispose of more than his own

interest in joint tenancy property, i.e., one

‐ half thereof.” Id. (citation

and internal quotation marks omitted); s ee also Johnson v. Bell

, 666

P.2d 308, 312 (Utah 1983) (“A grantee under a quitclaim deed

acquires only the interest of his grantor be that interest what it

may.” (citation and internal quotation marks omitted)); Crowther v.Ashworth v. Bullock

20120278

‐ CA 2013 UT App 96 7 Mower

, 876 P.2d 876, 879–80 (Utah Ct. App. 1994) (holding that a

quitclaim deed of the mother’s one

‐ half interest in property

severed the joint tenancy and created a tenancy in common). Here,

Bates never executed a deed in favor of the Bullocks. In addition,

Ashworth concedes that Bates’s intent was to contract for the sale

of the entire Property, not just his half interest in it. See In re Estate

of Knickerbocker

, 912 P.2d 969, 975 (Utah 1996) (“[T]he key to

determining whether a joint tenancy has been severed is the intent

of the parties.”); Williams

, 723 P.2d at 425 (holding that one joint

tenant could not alone accept an offer to purchase property where

the “[buyers] offered to purchase the joint interest of the [sellers],

and [one joint tenant] negotiated for the sale of the joint interest”);

Centennial Inv., 2007 UT App 321, ¶ 12 (“[B]oth parties agree that

the negotiations were for the purchase of the joint interest of [the

joint tenants].”).

¶13 The Writing in this case indicates that Bates purported to

contract to sell the entire property, stating, “I Joe Bates am selling

my home.” See Utah Code Ann. § 57

‐ 1

‐ 3 (LexisNexis 2010) (“A fee

simple title is presumed to be intended to pass by a conveyance of

real estate, unless it appears from the conveyance that a lesser

estate was intended.”); Gold Mountain Dev., LLC v. Missouri Flat,

Ltd.

, 2005 UT App 276U, para. 13 (mem.) (Orme, J., concurring in

part, dissenting in part) (noting that the word “sell” is one that

“typically indicate[s] a conveyance of title rather than the

conveyance of a lesser estate”); cf. Crowther

, 876 P.2d at 880

(holding that the quitclaim deed unambiguously evidenced the

joint tenant’s intent to convey her “one

‐ half interest” and was

therefore effective to sever the joint tenancy). Because Bates

attempted to contract to sell the entire Property but could not

validly agree to convey more than his own joint interest, the

Writing did not ripen into a contract before Harris’s death. See

Williams

, 723 P.2d at 425. As a result, it did not sever the joint

tenancy and Harris’s interest in the Property passed to Bates by

operation of law when she died.Ashworth v. Bullock

20120278

‐ CA 2013 UT App 96 8 III. The Writing Ripened into an Enforceable Contract.

¶14 Even though Ashworth is correct that the Writing did not

comport with the requirements of the statute of frauds in 1976, we

agree with the trial court’s determination that it became an

enforceable contract when Harris’s interest passed to Bates. In

reaching this conclusion, we find instructive the Utah Supreme

Court’s decision in Williams v. Singleton

, 723 P.2d 421 (Utah 1986)

(per curiam). There, the buyers made an offer to purchase real

property held in joint tenancy by the sellers, a husband and wife.

Id. at 422. By its terms, the offer expired if not accepted in one day.

Id

. The husband provided written authorization to the sellers’ real

estate agent to accept the offer on his behalf, but the wife did not

execute the authorization. Id. at 423. After the real estate agent

accepted the offer, the buyers decided not to purchase the property

and the sellers refused to return their $5,000 earnest money. Id. The

sellers sued, and the district court ruled in favor of the buyers,

despite the wife’s belated attempt to ratify the husband’s actions in

writing. Id. On appeal, the Utah Supreme Court held that no

enforceable contract had been formed because the husband could

not accept the buyers’ offer without written authorization from the

wife. Id. at 423–24; see also id. (“[A]n offer to purchase when

accepted creates an interest in real estate and is within the statute

of frauds.” (citations omitted)).

¶15 Of significance to the issue before us, the Williams court also

held that the wife’s attempt to ratify the husband’s acceptance in

writing was “ineffectual to revive the contract ” because it was made

after the offer had expired according to the one

‐ day deadline. Id. at

424 (emphasis added) (citing Burg v. Betty Gay of Wash., Inc.

, 225

A.2d 85, 86 (Pa. 1966) (holding that ratification “must be in writing

and executed prior to any effective renunciation by [the other party

to the agreement]”)); see also Centennial Inv. Co. v. Nuttall, 2007 UT

App 321, ¶ 12, 171 P.3d 458 (holding that a Real Estate Purchase

Contract (REPC) executed by only one joint tenant never ripened

into a contract and therefore a subsequent REPC by which both

joint tenants agreed to convey the property to a third party did notAshworth v. Bullock

20120278

‐ CA 2013 UT App 96 9 breach the prior REPC). By implication, our supreme court’s

analysis indicates that had the wife ratified within the deadline for

acceptance, the statute of frauds would have been satisfied and the

contract, which was initially void and unenforceable, would have

ripened into an enforceable contract.

¶16 In the present case, nothing occurred between Bates’s

execution of the Writing and his acquisition of fee title in the

Property to prevent it from ripening into a contract. By the terms

of the Writing and the parties’ practices, Bates was not expected to

convey title to the Property until 2013, when the Bullocks would

have paid in full. Before he was required to transfer title, Harris’s

interest passed to Bates, thereby giving him sole ownership of the

Property. Although the contract was unenforceable when originally

signed, Bates’s acquisition of full title “revived” it because Harris’s

signature was no longer necessary to satisfy the statute of frauds

and the Writing had not been repudiated. See Williams, 723 P.2d at

424.

¶17 Accordingly, we reject Ashworth’s argument that a contract

void and unenforceable under the statute of frauds cannot become

enforceable when the statutory defect is cured. Otherwise,

subsequent ratification by the joint tenant who had not previously

signed a real estate purchase contract would be irrelevant. Cf. id.

(determining that because the offer had expired, the wife’s attempt

to ratify and accept it was ineffectual to create a contract). We also

note that generally “a seller may make a valid contract to sell

property, though the seller has no legal title to the property, as long

as the seller has title when the time to convey arrives.” Utah Golf

Ass’n, Inc. v. City of N. Salt Lake

, 2003 UT 38, ¶ 15, 79 P.3d 919; see

also Neves v. Wright

, 638 P.2d 1195, 1197 (Utah 1981) (reiterating the

“fundamental rule that a seller need not have legal title during the

entire executory period of a real estate contract”); Corporation Nine

v. Taylor

, 513 P.2d 417, 421 (Utah 1973) (“[T]he law does not require

the vendor to have clear and marketable title at all times during the

performance of his contract, and [he] is not ordinarily so obliged

until the time comes for him to perform.”). This rule is designed toAshworth v. Bullock

4. We note that some jurisdictions hold that this result is dictated

by their after

‐ acquired title statutes or common law concepts of

after

‐ acquired title. See, e.g.

, Hardigan v. Kimball

, 553 A.2d 1265,

1266–67 (Me. 1989) (holding that a land sale contract executed by

one of two joint tenants was unenforceable when executed but

became effective by virtue of Maine’s doctrine of after

‐ acquired

title when the other joint tenant died and his interest passed to the

joint tenant who had executed the contract); Brousseau v. Brousseau

,

927 A.2d 773, 778 n.2 (Vt. 2007) (J. Dooley, dissenting) (“Regardless

of whether [the other joint tenant’s] interest passed to mother by

right of survivorship or by will, mother subsequently obtained

. . . the right to convey the property free of any claim by [the other joint

tenant or that tenant’s] estate. Mother’s claim that [her grantee]

now only holds a quarter interest in the property, therefore is

defeated by the doctrine of after

‐ acquired title.”); Simon v. Chartier

,

27 N.W.2d 752, 754 (Wis. 1947) (holding that, even if a contract for

the sale of land was void due to one joint tenant’s mental

incompetence at the time it was executed, it became enforceable

when that joint tenant died and his interest passed to the other joint

(continued...)

20120278

‐ CA 2013 UT App 96 10 “enhance the alienability of real estate by providing necessary

flexibility in real estate transactions.” Neves

, 638 P.2d at 1198. When

applying it, courts should scrutinize the facts carefully and seek to

“avoid unfairness, sharp practice, [or] outright dishonesty.” Id. In

this case, fairness dictates that the rule be applied.

¶18 Our supreme court has also instructed that the statute of

frauds “should be used for the purpose of preventing fraud and

not as a shield by which fraud can be perpetrated.” Jacobson v. Cox

,

202 P.2d 714, 720 (Utah 1949). Ashworth’s position that Bates’s

estate is entitled to the Property despite Bates’s written attempt to

convey it to the Bullocks, the Bullocks’ thirty

‐ year performance of

the terms of the Writing, and Bates’s acquisition of the entire

Property before his performance was due under the contract,

would result in such a shield to Bates’s estate and be contrary to the

purposes of the statute of frauds. 4Ashworth v. Bullock

4. (...continued)

tenant, whose mental capacity at the time of execution was not in

dispute). Because we affirm on other grounds, we express no

opinion on the impact of Utah’s after

‐ acquired title statute to the

facts of this case. See generally Utah Code Ann. § 57

‐ 1

‐ 10

(LexisNexis 2010).

20120278

‐ CA 2013 UT App 96 11 CONCLUSION

¶19 The Writing became an enforceable contract to sell the

Property to the Bullocks. Although Bates, as a joint tenant, did not

hold legal title at the time he executed the Writing, he held title in

fee simple absolute once he survived the other joint tenant. At that

point, the Writing had not expired or been repudiated, and Bates

had not yet been required to convey title. Therefore, the Writing

was no longer unenforceable under the statute of frauds.

¶20 Affirmed.