Court Opinion

ID: 9637453
Source: CourtListenerOpinion
Date Created: 2023-08-22 15:07:00.613937+00
Date Added: 2024-06-11T13:39:05.777198
License: Public Domain

IN THE SUPREME COURT OF THE STATE OF IDAHO
                                Docket No. 49231

 TREASURE VALLEY HOME SOLUTIONS, )
 LLC, an Idaho limited liability company, )
                                          )                     Boise, November 2022 Term
    Plaintiff-Counterdefendant-Appellant, )
                                          )                     Opinion filed: February 14, 2023
 v.                                       )
                                          )                     Melanie Gagnepain, Clerk
 RICHARD E. CHASON, an individual,        )
                                          )
    Defendant-Counterclaimant-Respondent. )

       Appeal from the District Court of the Fourth Judicial District of the State of
       Idaho, Ada County. Derrick O’Neill, District Judge.

       The decision of the district court is affirmed in part and reversed in part.

       Borton-Lakey Law & Policy, Meridian, for Appellant. Joseph W. Borton argued.

       Sherer & Wynkoop, LLP, Meridian, for Respondent. Stephen T. Sherer argued.

ZAHN, Justice.
       This case concerns the enforceability of a Real Estate Purchase and Sale Agreement
(“Agreement”) between Treasure Valley Home Solutions, LLC, (“TVHS”) and Richard Chason.
TVHS filed a complaint against Chason alleging breach of contract and requesting specific
performance of the contract after Chason refused to move forward with the transaction. Chason
filed a motion for summary judgment, arguing the Agreement lacked definite terms and was
therefore unenforceable. The district court granted Chason’s motion for summary judgment after
concluding the Agreement was a mere “agreement to agree.” The district court also awarded
Chason attorney fees pursuant to Idaho Code section 12-120(3). TVHS appeals both orders. We
affirm the district court’s grant of summary judgment, but reverse its award of attorney fees.
                 I.    FACTUAL AND PROCEDURAL BACKGROUND
       Treasure Valley Home Solutions, LLC, (“TVHS”) is an Idaho limited liability company
that buys and sells properties. Dan Walters is the registered agent, member, and manager of TVHS.
On September 24, 2020, TVHS submitted an Agreement offering to purchase certain real property

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and residential improvements from Richard Chason. The Agreement listed a purchase price of
$330,000, payable as follows:
       a) By initial Deposit submitted herewith receipt of which is hereby acknowledged
          . . . $500
       ...
       d) By Seller Terms Sheet . . . $55,000
       e) Balance to be paid by certified check or bank check at Closing . . . $274,500.
The Agreement also provided that the $500 deposit “shall be made at the stated times” and
       [i]n the event any deposit funds payable pursuant to this Agreement are not paid by
       Buyer, Seller may give written notice of such failure to Buyer. If such notice is
       given and a period of 3 (three) days pass without Buyer paying the Deposit owed.
       Seller may declare Buyer in default and shall have the remedies set forth in
       Paragraph 14.
The Agreement indicated that additional terms and conditions were attached. An attachment
entitled “Additional Terms and Conditions,” stated, in pertinent part:
       5. Purchase price contingent upon Buyer and Seller mutually agreeing to seller
       financing terms in seller terms sheet on or before October 7, 2020.
A second attachment to the Agreement was entitled “Term Sheet,” and stated, in pertinent part:
       ***Terms of this agreement to be set by Seller & Buyer on or before October 7,
       2020****
       Preamble: This term sheet sets forth the proposed terms and conditions for a seller
       financed loan on [address] between Treasure Valley Home Solutions, LLC and
       Richard E. Chason (sic)
The purchase price section of the Term Sheet contained blanks for “purchase price,” “down
payment,” “interest rate,” “term,” “payment,” and “balloon.” There were no numbers or
amounts written in the blanks.
       On September 25, 2020, Chason electronically signed the Agreement and emailed it to
Walters. The following day Chason texted Walters:
       Dan I am opting out of your contract under paragraph 14 you have not paid me the
       $500 and so I’m entitled to rescind the agreement and refuse your offer to sell to
       you.
Two days later, on September 28, Walters deposited $500 into escrow with Pioneer Title
Company. Walters subsequently attempted to perform an onsite inspection, but Chason refused to
allow Walters to access to the property.

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       TVHS filed a complaint against Chason alleging breach of contract and requested a
judgment ordering specific performance of the contract. After initiating the lawsuit, TVHS sent
Chason three new letters seeking to buy the property. Chason filed an answer and counterclaim,
alleging TVHS was in default by failing to make the required $500 deposit. Chason subsequently
moved for summary judgment, arguing: (1) TVHS first breached the contract by failing to submit
the $500 deposit, (2) the contract failed for indefiniteness and lacked necessary terms, (3) TVHS
waived any rights it had to enforce the contract by not including the necessary information in the
term sheet, and (4) TVHS’s subsequent offers rescinded its first offer.
       The district court held a hearing on the matter and granted Chason’s motion for summary
judgment. The district court rejected all of Chason’s arguments except for Chason’s contention
that the Agreement lacked definiteness. The district court explained that the Agreement lacked
reasonable certainty of material terms, because the $55,000 financed portion of the purchase price
was not addressed. Specifically, the Agreement stated that $55,000 of the purchase price was
payable “By Seller Terms Sheet.” However, the district court explained that the term sheet
“indicates that discussions concerning [the conditions and provisions of the $55,000] were ongoing
and were to be set by Seller & Buyer on or before October 7, 2020.” Accordingly, the district court
found that there was no meeting of the minds “as to what the conditions and provisions were
concerning the $55,000 of the term sheet, which clearly were intended to be a part of the sale of
the property and a part of the agreement.” The district court subsequently dismissed TVHS’s claim
with prejudice.
       Chason filed a motion for attorney fees and costs pursuant to Idaho Code sections 12-
120(3) and 12-121 and Idaho Rule of Civil Procedure 54. The district court concluded that the
gravamen of the complaint was a commercial transaction and awarded Chason attorney fees in the
amount of $6,225 and costs in the amount of $140.08 pursuant to Idaho Code section 12-120(3).
                                    II.    ISSUES ON APPEAL
   1. Whether the district court erred when it granted Chason’s motion for summary judgment?
   2. Whether the district court erred when it granted Chason attorney fees pursuant to Idaho
      Code section 12-120(3)?
   3. Whether either party is entitled to attorney fees on appeal?
                             III.         STANDARD OF REVIEW
       “The standard of review on appeal from an order granting summary judgment is the same
standard that is used by the district court in ruling on the summary judgment motion.” Berglund v.

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Dix, 170 Idaho 378, ___ 511 P.3d 260, 266 (2022) (quoting Hoke v. Neyada, Inc., 161 Idaho 450,
453, 387 P.3d 118, 121 (2016)). “The court must grant summary judgment if the movant shows
that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a
matter of law.” I.R.C.P. 56(a). “A moving party must support its assertion by citing particular
materials in the record or by showing the ‘materials cited do not establish the . . . presence of a
genuine dispute, or that an adverse party cannot produce admissible evidence to support the
fact[s].’” Aizpitarte v. Minear, 170 Idaho 186, 508 P.3d 1260, 1267 (2022) (quoting I.R.C.P.
56(c)(1)(B)). “All disputed facts are to be construed liberally in favor of the non-moving party,
and all reasonable inferences that can be drawn from the record are to be drawn in favor of the
non-moving party.” Manning v. Micron Tech., Inc., 170 Idaho 8, 506 P.3d 244, 248 (2022)
(quoting Ware v. City of Kendrick, 168 Idaho 795, 798, 487 P.3d 730, 733 (2021)).
“Summary judgment is improper ‘if reasonable persons could reach differing conclusions or draw
conflicting inferences from the evidence presented.’” Owen v. Smith, 168 Idaho 633, 641, 485 P.3d
129, 137 (2021) (quoting Trumble v. Farm Bureau Mut. Ins. Co. of Idaho, 166 Idaho 132, 141,
456 P.3d 201, 210 (2019)). That said, a “mere scintilla of evidence or only slight doubt as to the
facts is not sufficient to create a genuine issue of material fact for the purposes of summary
judgment.” Id.
                                      IV.       ANALYSIS
A. The district court did not err when it granted Chason’s motion for summary judgment.
       TVHS argues that summary judgment was not appropriate because “there are conflicting
facts on the issue of whether Chason financing $55,000 was a material term of the [Agreement],”
as is evidenced by Chason’s and Walter’s affidavits. TVHS contends that the district court
improperly assessed the credibility of the affiants and weighed conflicting evidence in Chason’s
favor. However, TVHS points to Chason’s text message to Walters, in which he referred to the
Agreement as a “contract,” as proof that there was a genuine issue of material fact regarding the
existence and enforceability of the contract.
       Chason argues that the district court properly granted summary judgment because the
identity of the parties to the contract was not established because it appeared that Walters signed
the Agreement in his personal capacity, not on behalf of TVHS. Additionally, Chason argues that
“the material terms of the proposed contract were not established” because the Agreement lacked
specific terms relating to financing the remaining $55,000.

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       Following a hearing on the motion, the district court granted summary judgment in
Chason’s favor after determining that the Agreement “lacks reasonable certainty as to a material
term: namely, the conditions and provisions of the $55,000 of the term sheet.” The district court
found that “there was no meeting of the minds as to what the conditions and provisions were
concerning the $55,000 of the term sheet, which clearly were intended to be a part of the sale of
the property and a part of the agreement.” The district court explained that since the Term Sheet
indicated that discussions concerning the $55,000 would take place “on or before October 7,
2020[,]” the Agreement was merely an “agreement to agree.” The district court noted that TVHS
confirmed the Agreement was to further agree in its response to request for admission no. 1.
        The purpose of contract interpretation “is to determine the intent of the contracting parties
at the time the contract was entered. In determining the intent of the parties, this Court must view
the contract as a whole.” Bakker v. Thunder Spring-Wareham, LLC, 141 Idaho 185, 190, 108 P.3d
332, 337 (2005) (quoting Lamprecht v. Jordan, LLC, 139 Idaho 182, 185–86, 75 P.3d 743, 746–
47 (2003)). “An unambiguous contract will be given its plain meaning.” Id.
       The Agreement unambiguously stated that payment of $55,000 of the purchase price would
be addressed in the attached Term Sheet. Further, the attached Additional Terms and Conditions
unambiguously stated that the purchase price was contingent on TVHS and Chason agreeing to
seller financed terms on or before October 7, 2020. The Term Sheet was blank yet stated it set
forth the specific terms and conditions for a seller financed loan between TVHS and Chason. The
Term sheet also indicated its terms would be set by TVHS and Chason on or before October 7,
2020. It is undisputed that the terms had not yet been negotiated or agreed upon at the time Chason
rescinded his acceptance on September 26, 2020.
       “No enforceable contract comes into being when parties leave a material term for future
negotiations, creating a mere agreement to agree.” Brunobuilt, Inc. v. Strata, Inc., 166 Idaho 208,
217, 457 P.3d 860, 869 (2020) (quoting Spokane Structures, Inc. v. Equitable Inv., LLC, 148 Idaho
616, 621, 226 P.3d 1263, 1268 (2010)). A contingency is “dependent on something that might or
might not happen in the future.” Contingent, Black’s Law Dictionary (11th ed. 2019). The plain
and unambiguous language of the Agreement, including its attachments, demonstrates that the
purchase price identified on the first page of the Agreement was not final, but instead was
contingent on the parties reaching consensus on the terms of a seller-financed loan for $55,000 of
the purchase price. As a result, the Agreement was not yet a binding contract, but rather an

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agreement to agree. Because the parties had not reached consensus on the seller-financed loan,
there was never a meeting of the minds between the parties as to the purchase price. Without a
purchase price, the Agreement is unenforceable. P.O. Ventures, Inc. v. Loucks Fam. Irrevocable
Tr., 144 Idaho 233, 238, 159 P.3d 870, 875 (2007) (citation omitted) (“For a land sale contract to
be specifically enforced, the contract must typically contain the minimum provisions of the parties
involved, the subject matter thereof, the price or consideration, a description of the property, and
all the essential terms of the agreement.”).
       Finally, TVHS argues that Chason’s use of the word “contract” in the parties’ text messages
amounts to a legal admission that there was a binding contract. However, Chason is a layperson
and we will not take his language out of context to interpret it as a concession that the “contract”
was complete. It is quite common for people, including attorneys, to refer to a draft of an unsigned
agreement as “the contract.” Chason’s mere use of the word contract does not make an
unenforceable contract enforceable.
       In sum, inasmuch as the parties never agreed on those terms, the Agreement was merely
an agreement to agree. Accordingly, we hold that the contract was unenforceable and the district
court did not err when it granted summary judgment in favor of Chason. Because we affirm the
district court’s grant of summary judgment on this basis, we need not address Chason’s remaining
arguments in support of the district court’s grant of summary judgment.

B. The district court erred in awarding Chason attorney fees.
       1. The district court erred in awarding Chason attorney fees pursuant to Idaho Code
          section 12-120(3).
       TVHS argues that the district court erred in awarding attorney fees under Idaho Code
section 12-120(3) because the Agreement was not a commercial transaction, but rather a personal
one, because the real property was Chason’s personal residence. Chason argues that the district
court appropriately awarded attorney fees under Idaho Code section 12-120(3) because the sale of
real estate is not a personal transaction and, thus, it is a commercial transaction for purposes of
section 12-120(3). Further, Chason maintains that he is entitled to attorney fees under the
Agreement.
       The district court awarded attorney fees pursuant to Idaho Code section 12-120(3) after
determining the purpose of the Agreement was to purchase real property for commercial
development. The district court explained that “the gravamen of the complaint was for breach of

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contract, and the litigation of a contract to purchase real property for the purposes of that
commercial development by [TVHS] was a commercial transaction.”
        “The awarding of attorney fees and costs is within the discretion of the district court and
is subject to the abuse of discretion standard of review.” Breckenridge Prop. Fund 2016, LLC v.
Wally Enterprises, Inc., 170 Idaho 649, ___, 516 P.3d 73, 86 (2022) (citing Idaho Transp. Dep’t
v. Ascorp, Inc., 159 Idaho 138, 140, 357 P.3d 863, 865 (2015)). “The burden is on the party
opposing the award to demonstrate that the district court abused its discretion.” Lettunich v.
Lettunich, 145 Idaho 746, 749, 185 P.3d 258, 261 (2008) (quoting Eastern Idaho Agricultural
Credit Ass’n v. Neibaur, 133 Idaho 402, 412, 987 P.2d 314, 324 (1999)). To determine whether
the district court abused its discretion in awarding attorney fees, this Court must assess whether
the trial court: “(1) correctly perceived the issue as one of discretion; (2) acted within the outer
boundaries of its discretion; (3) acted consistently with the legal standards applicable to the
specific choices available to it; and (4) reached its decision by the exercise of reason.” Berglund
v. Dix, 170 Idaho 378, ___ 511 P.3d 260, 266 (2022) (quoting Lunneborg v. My Fun Life, 163
Idaho 856, 863, 421 P.3d 187, 194 (2018)). However, “[w]hether a district court has correctly
determined that a case is based on a commercial transaction for the purpose of I.C. § 12-120(3) is
a question of law over which this Court exercises free review.” Garner v. Povey, 151 Idaho 462,
469, 259 P.3d 608, 615 (2011).
       Idaho Code section 12-120(3) “allows for an award of attorney fees to a prevailing party
in a civil action to recover on any commercial transaction.” Buku Properties, LLC v. Clark, 153
Idaho 828, 836, 291 P.3d 1027, 1035 (2012) (citing Garner, 151 Idaho at 469, 259 P.3d at 615).
To recover attorney fees under Idaho Code section 12-120(3), the gravamen of the claim must
involve a commercial transaction. Breckenridge Prop. Fund 2016, LLC, 170 Idaho at ___, 516
P.3d at 87. Courts determine whether the gravamen of a claim is a commercial transaction by
analyzing whether: (1) there is a commercial transaction that is integral to the claim; and (2) the
commercial transaction is the basis upon which recovery is sought. Id. (quoting Great Plains
Equip., Inc. v. Nw. Pipeline Corp., 136 Idaho 466, 471, 36 P.3d 218, 223 (2001)). “The term
‘commercial transaction’ is defined to mean all transactions except transactions for personal or
household purposes. The term ‘party’ is defined to mean any person, partnership, corporation,
association, private organization, the state of Idaho or political subdivision thereof.” I.C. § 12-
120(3). “For a commercial transaction to be present for the purposes for [sic] I.C. § 12-120(3)

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‘each party to the transaction must enter the transaction for a commercial purpose.’” Buku
Properties, LLC, 153 Idaho at 836, 291 P.3d at 1035 (quoting Carrillo v. Boise Tire Co., Inc., 152
Idaho 741, 756, 274 P.3d 1256, 1271 (2012)). Notably, “a mere request for attorney fees pursuant
to I.C. § 12-120(3), without more, is not sufficient to trigger the commercial transaction prong of
that section.” Id. at ___, 516 P.3d at 87 (emphasis removed).
       In its decision awarding attorney fees, the district court stated, “the gravamen of the
complaint was for breach of contract, and the litigation of a contract to purchase real property for
the purposes of that commercial development by [TVHS] was a commercial transaction.”
However, the record does not support the conclusion that the transaction itself was commercial, or
that either party had a commercial purpose for entering into the transaction. Neither of the parties’
pleadings alleged the parties entered into a commercial transaction. Additionally, Chason
submitted no evidence that the property was to be used for a commercial purpose. He merely
asserted that the purchase of real property is a commercial transaction.
       This Court has held that “the conveyance of real property may constitute a commercial
transaction.” Brown v. Greenheart, 157 Idaho 156, 167, 335 P.3d 1, 12 (2014) (emphasis added,
citation omitted). In Brown, this Court affirmed an award of attorney fees pursuant to Idaho Code
section 12-120(3) when the conveyance of real property included a parcel of grazing land with no
residential property. Id. at 168, 335 P.3d at 13. Other cases confirm this notion that the conveyance
of real property may constitute a commercial transaction when there was a commercial element to
the property. See Watson v. Watson, 144 Idaho 214, 216, 159 P.3d 851, 853 (2007) (holding the
sale of a property was a commercial transaction where the land was used for both a family retreat
and logging); Herrick v. Leuzinger, 127 Idaho 293, 306, 900 P.2d 201, 214 (Ct. App. 1995)
(holding that the lease of real property was a commercial transaction where the property included
a residence as well as land used for commercial ranching). Additionally, the parties must have
mutuality of commercial purpose to constitute a commercial transaction for purposes of section
12-120(3). See Buku Properties, LLC, 153 Idaho at 836, 291 P.3d at 1035.
       In reaching its decision in this case the district court relied on Heritage Excavation, Inc. v.
Briscoe, 141 Idaho 40, 105 P.3d 700 (Ct. App. 2005). In Heritage Excavation, Inc., the Court of
Appeals awarded attorney fees on appeal pursuant to Idaho Code section 12-120(3) after finding
the contract involved a commercial transaction because both parties intended to develop the land.
Id. at 44, 105 P.3d at 704. That said, the Court of Appeals did not analyze whether each party to

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the transaction had a commercial purpose. Id. The Court of Appeals did, however, note that the
defendant who originally owned the property was interested in eventually selling or developing
the property for a subdivision. Id. at 42, 105 P.3d at 702. The plaintiff was a development company.
Id. We can infer from these facts that both parties to the transaction shared a mutuality of
commercial purpose.
       The record in this case contains no evidence establishing that the real property at issue had
a commercial element. To the contrary, the record establishes that the real property was Chason’s
personal residence. We have held that section 12-120(3) does not apply to the purchase of real
property for personal use because the “transaction lacks the required symmetry of commercial
purpose[.]” Goodspeed v. Shippen, 154 Idaho 866, 874, 303 P.3d 225, 233 (2013). Chason has
provided no evidence here to establish a symmetry of commercial purpose in the sale his personal
residence. We decline his invitation to hold that the sale of real property always constitutes a
commercial transaction.
       The district court failed to act consistently with the legal standards applicable to the specific
choices before it. The district court did not cite evidence in the record establishing that there was
a commercial element to the real property or establishing a mutuality of commercial purpose
between TVHS and Chason. For this reason, this case is distinguishable from Heritage Excavation.
Therefore, we hold that the district court erred in awarding Chason attorney fees under Idaho Code
section 12-120(3).

       2. The district court did not err when it determined Chason was not entitled to attorney
          fees pursuant to the Agreement.
       Next Chason argues that, in the event the Court determines the district court erred in
awarding attorney fees under Idaho Code section 12-120(3), the Court should determine that the
district court erred in failing to award attorney fees under the terms of the Agreement. Chason
maintains that the district court’s failure to award attorney fees under the Agreement is a violation
of public policy because only allowing the recovery of fees for enforceable contracts means TVHS
is the only party with the potential to receive fees. The district court determined that Chason could
not seek to enforce the attorney fees provision of the Agreement after arguing the Agreement is an
unenforceable contract.
       “[P]arties generally cannot benefit from a contractual attorney fees provision” where the
contract is “deemed never to have existed in the eyes of the law.” Wadsworth Reese, PLLC v.

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Siddoway & Co., PC, 165 Idaho 364, 369, 445 P.3d 1090, 1095 (2019) (internal quotations and
citations omitted). We have determined that the parties entered into “an agreement to agree” rather
than a legally binding contract. Therefore, Chason cannot seek to enforce a contract that was never
formed in the first place. Further, Chason fails to support his contention with any legal authority
recognizing the public policy he urges us to apply here. Accordingly, the district court did not err
in denying Chason’s request for attorney fees pursuant to the Agreement.
C. We do not award either party attorney fees on appeal.
        TVHS argues it is entitled to attorney fees on appeal pursuant to Idaho Code section 12-
121. Idaho Code section 12-121 allows a court to “award reasonable attorney’s fees to the
prevailing party” if “the case was brought, pursued or defended frivolously, unreasonably or
without foundation.” TVHS did not prevail on one of its claims and, therefore, is not a prevailing
party entitled to attorney fees.
        Chason argues that he is entitled to attorney fees on appeal pursuant to Idaho Code section
12-120(3) and section 14 of the Agreement. For the reasons stated previously, we decline to award
Chason attorney fees on appeal under either section 12-120(3) or the Agreement.
                                      V.    CONCLUSION
        The decision of the district court is affirmed in part and reversed in part. The district court
did not err when it granted Chason’s motion for summary judgment because a valid contract was
never formed between the parties. However, the district court erred when it awarded Chason
attorney fees pursuant to Idaho Code section 12-120(3) because the evidence did not establish that
a commercial transaction was the gravamen of the claim between TVHS and Chason. Neither party
is awarded attorney fees or costs on appeal.
        Chief Justice BEVAN, Justices BRODY, STEGNER and MOELLER CONCUR.

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