Court Opinion

ID: 9797475
Source: CourtListenerOpinion
Date Created: 2023-08-31 04:21:50.024217+00
Date Added: 2024-06-11T08:56:22.003892
License: Public Domain

TROUT, Chief Justice.
This case involves a dispute between two creditors claiming an interest in the proceeds from the sale of a hotel owned by One Hundred Building Corporation (“the Corporation”). JSGACG Trust (“the Trust”) appeals the district judge’s decision awarding $135,000 in interpleaded funds to Grubb and Ellis Commercial Real Estate Services and Colliers Paragon, Inc. (“the Brokers”).
I.
FACTUAL AND PROCEDURAL HISTORY
The Corporation is a Maryland corporation, which owned and operated the Pinnacle Inn located in Ketchum, Idaho. James S. Gibson is the president of the Corporation and his wife, Andrea, is the secretary.
The Pinnacle Inn was not a successful business venture, losing an average of $10,000 a month over a period of seven or eight years. In order to keep the Pinnacle Inn running, the Trust supported the Corporation by advancing money for payment of obligations and operating deficiencies of the business. The acronym JSGACG stands for James S. Gibson and his wife Andrea C. Gibson, the same people who own the Corporation. The Trust is a family trust created in 1981, naming James Gibson as the primary beneficiary, the Gibson children as secondary beneficiaries, and Andrea Gibson as the trustee.
Even with the funds from the Trust, the Corporation faced foreclosure from its lien holder, Bank of America. The Corporation also faced a lawsuit by Nick and Kathleen Gyurkey who were the former owners of the Pinnacle Inn.1 Facing foreclosure and a lawsuit, the Corporation entered into an Exclusive Authorization of Sale with the Brokers in an attempt to sell the Pinnacle Inn.
On February 10, 1997, after failed attempts to find a buyer for the Pinnacle Inn, the Corporation filed for Chapter 11 Bankruptcy. Due to an administrative error, the bankruptcy proceeding was dismissed, but was reinstated once the error was diseover*519ed. During this time, James Gibson, acting in his capacity as the Corporation’s president, executed a promissory note in the amount of $902,782.66 and an accompanying deed of trust to Pinnacle Inn in favor of the Trust. It was also during this period that the Gyurkeys obtained a judgment in state court ordering the Gibsons to execute the prior settlement documents, which the parties had agreed to. After the administrative error was discovered, the bankruptcy judge determined that the transactions made during the dismissal period were void as violating the bankruptcy stay under 11 U.S.C. § 105(a).
The Corporation’s bankruptcy was subsequently dismissed for a second time, but this time on the merits. After the second bankruptcy dismissal, Bank of America recommenced foreclosure against the Pinnacle Inn, scheduling the sale to take place December 2,1997. Fearing that Bank of America’s sale of the Pinnacle Inn would terminate his interest and the interest of the Trust, James Gibson continued his search for a buyer. He found Eagle Crest on his own as a prospective buyer for the Pinnacle Inn.
Two conditions were required in order for the Eagle Crest transaction to be successful. First, the sale of the Pinnacle Inn was required to be finalized prior to the Bank of America foreclosure sale. Second, the Trust’s deed of trust had to be reconveyed to the Corporation, as Blaine County Title, the escrow agent handling the closing for the Eagle Crest transaction, refused to close the sale of the Pinnacle Inn unless there was clear title. To facilitate the transaction, Andrea Gibson signed a Request for Full Re-conveyance on behalf of the Trust so clear title could be conveyed to Eagle Crest.
Prior to closing, the Brokers discovered the pending sale of Pinnacle Inn and faxed a “Notice of Commission” to Blaine County Title on November 25, 1997. The Pinnacle Inn was ultimately sold to Eagle Crest for $2,250,000, closing on December 1, 1997. Blaine County Title held back $135,000 in trust to cover the claimed realtors’ fee.
The Brokers requested arbitration on January 27,1998, pursuant to paragraph 6 of the Exclusive Authorization of Sale. On June 26, 1998, four days before the arbitration hearing was to begin, James Gibson confessed judgment against the Corporation in favor of the Trust in the Superior Court of the State of Washington. James Gibson then took this foreign decree (i.e. Confession of Judgment) and filed a Notice of Filing of Foreign Judgment in the Fifth Judicial District, Blaine County. He then sought and obtained a Writ of Execution for the $135,000 held by Blaine County Title. The Brokers in response filed a third party claim. Unable to decide which party to pay, Blaine County Title interpleaded the funds into the district court.
The arbitration was concluded on September 14, 1998, with a final award in the amount of $180,478.49 in favor of the Brokers. An Order and Judgment Confirming Arbitration Award was entered by the district court on April 26,1999.
A bench trial was then held on September 29, 2000, to determine which party was entitled to the interpleaded funds. The district judge awarded the funds to the Brokers, concluding the Exclusive Authorization of Sale unambiguously provided six percent be paid at closing and the Corporation was, therefore, not entitled to the $135,000 after closing. The Trust now appeals the decision of the district court.
II.
STANDARD OF REVIEW
On appeal, this Court does not set aside findings of fact unless they are clearly erroneous. I.R.C.P. 52(a); Carney v. Heinson, 133 Idaho 275, 281, 985 P.2d 1137, 1143 (1999); Marshall v. Blair, 130 Idaho 675, 679, 946 P.2d 975, 979 (1997). Thus, if a district judge’s findings of fact are supported by substantial and competent, although conflicting, evidence, this Court will not disturb those findings. Marshall at id. Additionally, this Court gives due regard to the district judge’s special opportunity to judge the credibility of witnesses who personally appeared before the judge. I.R.C.P. 52(a); Marshall at id. This Court will not substitute its view of the facts for the view of the district judge. *520Marshall at id. However, unlike the Court’s review of the district judge’s findings of fact, the Court exercises free review over the district judge’s conclusions of law. Id.
III.
DISCUSSION
A. The Trust has provided sufficient argument.
Initially, the Brokers contend counsel for the Trust has not provided argument or authority to support this appeal, asking this Court to disregard the Trust’s issues raised on appeal.
In support of the Broker’s contention, they cite Young Electric Sign Co. v. State, ex rel., Winder, 135 Idaho 804, 25 P.3d 117, 123 (2001), where this Court held “[a] party waives an issue cited on appeal if either authority or argument is lacking, not just if both are lacking.” (quoting State v. Zichko, 129 Idaho 259, 923 P.2d 966 (1996)). However, this Court has held that an issue will be considered as long as argument is provided. See State v. Zichko, supra.
In this case, we find the issues raised by counsel for the Trust should not be dismissed for failure to provide argument or authority. Although the Trust’s initial brief does not contain any citation of authority supporting its position, counsel did provide argument explaining why the district court erred in its award of the funds to the Brokers. Those arguments are sufficient to warrant consideration of the Trust’s issues on appeal.
Additionally, the Trust has met this requirement through counsel’s citation of authority in his Reply Brief. Therefore, we find the Broker’s position without merit and will address the remaining issues on appeal.
B. The district judge did not err in awarding the real estate commission to the Brokers.
The district judge awarded the $135,000 commission to the Brokers, but did not specifically address whether a commission was due and whether the commission should come out of the escrow proceeds. It seems he implicitly concluded the parties agreed the commission, if owed, should come out of the escrow proceeds.
With respect to a debtor’s creditors, funds in the hands of a third person not subject to the claim of the debtor are not subject to attachment. 6 Am Jur 2d Attachment & Garnishment § 125 (1999). Thus, money deposited in escrow to be paid to the debtor upon the performance of a stipulated condition or in the event of a happening of an uncertain contingency cannot be reached by the debtor’s creditors before performance of such condition or the happening of such contingency. Id.
The Trust argues the Corporation and Eagle Crest, as the parties to the closing for the Pinnacle Inn, never agreed to allow Blaine County Title to hold $135,000 pending the result of the claimed commission by the Brokers. Therefore, since the $135,000 should have originally gone to the Corporation, the Trust, as the next creditor in line, was entitled to receive that money.
The Seller’s Escrow Instructions, however, dictate a different result. The escrow instructions directed Blaine County Title to pay or hold back proceeds from the sale of the Pinnacle Inn for the benefit of the Corporation’s creditors. As the depositary in escrow, Blaine County Title was required to follow the escrow instructions given to it. Where a person assumes and does act as the depositary in escrow, he is absolutely bound by the terms and conditions of the deposit and charged with a strict execution of the duties voluntarily assumed. All Am. Realty Inc. v. Sweet, 107 Idaho 229, 230, 687 P.2d 1356, 1357 (1984). Such a person is held to strict compliance with the terms of the escrow agreement and may not perform any acts with reference to handling the deposit or its disposal which are not authorized by the contract of deposit. Id.
In the instant case, the instructions specifically identified the creditors to be paid, and the Brokers were identified as one of these creditors. The escrow instructions state:
Covering the property described above which you may deliver and/or record when you have collected for the undersigned Sellers the sum of $2,250,000 (Selling *521Price) from which you are authorized to pay or deduct:
1. Balance of existing Deed(s) of Trust
2. Pay Demand of Chateau Drug
3. Pay Demand of United States of America/Internal Revenue Service
4. Pay Demand of Ringert, Clark Chartered
5. Real Estate Commission of $185,000 to Collier’s Paragon
6. Title Insurance Premium, 1/2 of the escrow fee and usual recording fees.
7. Federal Express
8. Escrow Holdback of $100,000
(Emphasis added).
Therefore, by virtue of its own escrow instructions, the $135,000 was to go directly to the Brokers as payment for their commission, and the Corporation therefore did not have an interest to the $135,000 held by Blaine County Title and the Trust could not attach those funds.
It would be contrary to accepted business practices to say that the parties entered into an agreement for payments of the commission “at closing” but did not intend for the commission to be paid as a part of the sales proceeds. “At closing” is a term of art which implies that at the time the buyer and seller settle the amounts due and owing between them, it includes the payment of a real estate commission. See Margaret H. Wayne Trust v. Lipsky, 123 Idaho 253, 846 P.2d 904, 911 (1993) (adopting the general rule that a commission is earned at the time the transaction closes).
Conceivably, however, a situation could arise where the sales proceeds are not sufficient to pay off all existing liens plus the real estate commission. In such a circumstance, it is still contemplated that the parties will resolve it as a part of the escrow and closing, and it is not intended the commission be paid separately as between the seller and realtor.
Once the entitlement to the commission was resolved through the arbitrator’s award, it automatically followed the commission should be paid from the proceeds from the sale (the interpleaded funds).
Based upon the foregoing, we find the district judge did not err in awarding the $135,000 to the Brokers.
C. We decline to address the district judge’s decision awarding attorney’s fees and costs.
The district judge awarded costs and attorney’s fees in favor of the Brokers on February 6, 2001. However, the district court subsequently granted the Trust’s request for an extension of time to file an objection to attorney fees and costs. In its Memorandum Decision and Order, the district court held “[t]his Court’s Order Awarding Costs and Attorney Fees entered February 6, 2001 insofar as it relates to payment of costs and attorney fees by JSGACG Trust is set aside until objections of JSGACG Trust can be heard.” There is nothing in the record indicating whether or not the attorney’s fees issue has been resolved, or under what authority the award was made. Accordingly, we decline to address this issue.
D. The Brokers are not entitled to costs and attorney’s fees on appeal.
The Brokers request attorney’s fees on appeal pursuant to Idaho Code § 12-121 and I.A.R. 41. In order for an award of attorney fees to be appropriate on appeal pursuant to Idaho Code § 12-121, this Court must be left with the abiding belief that the appeal was brought or pursued frivolously, unreasonably, and without foundation. Wooley Trust v. DeBest Plumbing, Inc., 133 Idaho 180, 187, 983 P.2d 834, 841 (1999). We do not believe that to be the case here, and therefore decline to award fees to the Brokers on appeal.
IV.
CONCLUSION
The district judge properly awarded the $135,000 withheld funds to the Brokers. We also award the Brokers costs but not attorney’s fees on appeal.
Justices SCHROEDER, WALTERS and KIDWELL, concur.

. The Gyurkeys initiated suit against the Gibsons alleging the Gibsons engaged in a fraudulent scheme to deprive them of their ownership interest in the Pinnacle Inn by transferring property to other Gibson entities. After more than four years of litigation the parties reached a settlement, and entered into a Memorandum of Understanding to confirm the essential terms of their agreement. During the following year, however, the Gibsons failed to execute the final settlement documents as set out in the agreement.