Court Opinion

ID: 4303971
Source: CourtListenerOpinion
Date Created: 2018-08-15 16:06:30.671014+00
Date Added: 2024-06-11T13:59:27.582280
License: Public Domain

IN THE COURT OF APPEALS OF IOWA

                                  No. 17-1487
                             Filed August 15, 2018

J.R., a minor by her next friend, TaNEALE TOWNER,
       Plaintiff-Appellant,

vs.

MICHAEL G. RUSH and ANN M. RUSH,
     Defendants-Appellees.
________________________________________________________________

      Appeal from the Iowa District Court for Plymouth County, Robert J. Dull,

District Associate Judge.

      A plaintiff appeals from the order granting dismissal of her petition in favor

of defendants and denying her motion for summary judgment on her conversion

claim. AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.

      Glenn A. Metcalf of Metcalf & Beardshear, Moville, for appellant.

      Elizabeth A. Row of Elizabeth A. Row, PC, Sioux City, for appellees.

      Considered by Vaitheswaran, P.J., and Doyle and Mullins, JJ.
                                         2

DOYLE, Judge.

      J.R. appeals from the order granting dismissal of her petition in favor of

Michael and Ann Rush and denying her motion for summary judgment on her

conversion claim.

      I. Backgrounds Facts and Proceedings.

      This contentious controversy over $2412.37 contains a lot of lawyer talk but

precious little evidence. We have sussed out the following facts from the scant

record before us: J.R. was born in 2001. TaNeale Towner is J.R.’s mother. From

2001 until 2015, Michael Rush believed he was J.R.’s biological father.

      In September 2010, a multiple-party savings account was opened at the

Bank of Dixon County. The account was opened with J.R.’s tax identification

number and birth date. The account was in the names of J.R., Michael Rush, and

Ann Rush (Michael’s wife). The account required two signatures for withdrawals.

Only two signatures appear on the signature card—Michael’s and Ann’s.1 The

opening deposit was in the amount of $1000. Another $1400 was added to the

account by five deposits made in each of the following years ($300 in 2011, $250

in 2012, $300 in 2013, $250 in 2014, and $250 in 2015).

      The evidence establishes that between May 2010 and August 2015,

Michael’s mother, Karen, sent J.R. four checks totaling $1300.2 “School/College,”

“(School),” or “Good Grades/College Fund” is written in the memorandum line of

1
  This is understandable since J.R. would have been nine years old at the time.
2
  Those checks were $500 in May 2010, $300 in July 2011, $250 in June 2014, and $250
in August 2015.
                                             3

three of the checks.3 The memo line was left blank on one. The first check, dated

May 2010, was made payable to “J.R./Michael or Ann Rush”—the rest were made

payable to J.R. The source of the other funds deposited into the account is not

established by evidence in our record, but the parties assert all of the funds

deposited into the savings account were gifts from Karen to J.R.

       After learning he was not the father of J.R., Michael disestablished paternity

in July 2015. On October 21, 2015, Michael and Ann closed the joint savings

account and transferred the funds, which then totaled $2412.37, to a checking

account along with money from their children, S.R. and F.R. On October 30, 2015,

Ann withdrew $5200 from the checking account and deposited it into a 529 plan4

that names S.R. as the beneficiary. J.R. is not named as a beneficiary. 5 Ann is

the account owner, and Michael is the successor owner.

       In March 2017, J.R., by and through her mother, TaNeale Towner, filed a

petition alleging Michael and Ann converted the joint savings account funds,

depriving J.R. of her ownership use of the funds. She sought compensatory

damages, punitive damages, and attorney fees. After Michael and Ann filed a

motion to dismiss or for summary judgment and for sanctions, J.R. resisted and

moved for summary judgment on the issue of conversion. Following an unreported

3
  The quality of the photocopied checks in issue is so poor that, without some context, i.e.,
copies of other checks, the payee and memo lines are illegible. In any event, the parties
do not dispute these items.
4
  A 529 plan is a type of investment account with certain tax advantages and is used to
save for the higher-education expenses of the beneficiary. See 26 U.S.C. § 529 (2018)
(allowing states to establish qualified tuition programs where person may contribute for
designated beneficiaries).
5
  It is unclear whether the 529 plan funds may be used for J.R.’s benefit. The law in the
area is complex and the legal arguments by counsel regarding the issue are undeveloped
at this point.
                                         4

hearing, the district court denied J.R.’s motion for summary judgment, granted

dismissal in favor of Michael and Ann, and denied their motion for sanctions. After

post-hearing motions were denied, J.R. appealed.

       II. Scope and Standard of Review.

       Summary judgment is appropriate only when “the pleadings, depositions,

answers to interrogatories, and admissions on file, together with the affidavits, if

any, show that there is no genuine issue as to any material fact and that the moving

party is entitled to a judgment as a matter of law.” Iowa R. Civ. P. 1.981(3). In

other words, the court may grant summary judgment when the only issue to be

decided is what legal consequences follow from otherwise undisputed facts. See

Emmet Cty. State Bank v. Reutter, 439 N.W.2d 651, 653 (Iowa 1989).

       We review an order granting summary judgment for correction of errors at

law. See Barker v. Capotosto, 875 N.W.2d 157, 161 (Iowa 2016). To prevail on a

motion for summary judgment, the moving party must show the material facts are

undisputed and, applying the law to those facts, the moving party is entitled to

judgment as a matter of law. See id.; Nelson v. Lindaman, 867 N.W.2d 1, 6 (Iowa

2015). Therefore, our review is limited to two questions: (1) whether there is a

genuine dispute regarding the existence of a material fact and (2) whether the

district court correctly applied the law to the undisputed facts. See Homan v.

Branstad, 887 N.W.2d 153, 164 (Iowa 2016).

       A fact is material if it may affect the lawsuit’s outcome. See id. There is a

genuine dispute as to the existence of a fact if reasonable minds can differ as to

how the factual question should be resolved. See id. “Even if facts are undisputed,
                                            5

summary judgment is not proper if reasonable minds could draw from them

different inferences and reach different conclusions.”          Walker Shoe Store v.

Howard’s Hobby Shop, 327 N.W.2d 725, 728 (Iowa 1982).

       We view the record in the light most favorable to the nonmoving party and

“indulge in every legitimate inference that the evidence will bear in an effort to

ascertain the existence” of a genuine issue of material fact. Crippen v. City of

Cedar Rapids, 618 N.W.2d 562, 565 (Iowa 2000). If the record shows that the

“resisting party has no evidence to factually support an outcome determinative

element of that party’s claim, the moving party will prevail on summary judgment.”

Wilson v. Darr, 553 N.W.2d 579, 582 (Iowa 1996).

       With regard to motions to dismiss,

               We review district orders granting a motion to dismiss for
       correction of errors at law. In reviewing the order, we view the
       petition in the light most favorable to the plaintiff, and will uphold
       dismissal only if the plaintiff’s claim could not be sustained under any
       state of facts provable under the petition.

Ackerman v. State, 913 N.W.2d 610, 614 (Iowa 2018) (cleaned up).6

       III. Discussion.

       J.R. alleges Michael and Ann converted the savings account funds. To

succeed on her conversion claim, J.R. must prove Michael and Ann exercised

wrongful dominion or control over her property in a manner that seriously interfered

with her right to control the property. See Condon Auto Sales & Serv., Inc. v. Crick,

6
  “Cleaned up” is a new parenthetical used to indicate that internal quotation marks,
alterations, and citations have been omitted from quotations for readability purposes. See
United States v. Steward, 880 F.3d 983, 986 n.3 (8th Cir. 2018); Jack Metzler, Cleaning
Up Quotations, 18 J. App. Prac. & Process 143 (Fall 2017).
                                            6

604 N.W.2d 587, 593 (Iowa 1999). Michael and Ann counter that Karen’s gifts

were conditional, conditioned upon being used for J.R.’s college education. With

a condition precedent to the gifts, they contend J.R. has no right of control over the

funds and they therefore could not have exercised wrongful dominion or control

over the property contrary to J.R.’s possessory right to the property.

       The district court concluded,

                Based on the facts set out above the Court concludes that no
       gift was, in fact, ever made in this matter and hence no conversion
       could occur. At no time did J.R. ever have access to the funds in
       question as she was not on the signature card, and even if she had
       been, withdrawal required the consent of one of the defendants. The
       transfer or gift was therefore conditional. “If a condition as to vesting
       of title is attached to the delivery of the gift, the gift fails. Therefore,
       a valid gift is made when a non-conditional delivery is tendered;
       otherwise it is not a valid inter vivos gift.” Raim v. Stancel, 339
N.W.2d 621, 623-24 (Iowa Ct. App. 1983). Also, “[t]he insertion of a
       condition in a contract does not render the same void but only delays
       the enforceability of the contract until the condition precedent has
       taken place.” H.L. Munn Lumber Co. v. City of Ames, 176 N.W.2d
813 (Iowa 1970). And finally, “[i]f a donor keeps some control over
       a gift to assure some purpose for the gift, the gift is not irrevocable
       and fails.” Raim, 339 N.W.2d at 623-24.
                Based on the foregoing, the Court concludes that Plaintiff fails
       to state a claim upon which relief can be granted as no completed
       gift ever occurred in this matter.

       The record is razor thin. Michael and Ann contend Karen gave the checks

to J.R. “only for future college expenses and J.R. was fully aware of this fact.” They

also claim, “J.R. was aware in 2015 that the funds were transferred to the 529

account, and that they would not be available to her until she went to college,” and

that “J.R. is aware of the purposes of the funds, as it was both noted on the checks

and discussed by J.R., Michael, and Michael’s mother on several occasions.” With

no affidavits or deposition testimony we are left only to speculate as to Karen’s
                                        7

intentions or J.R.’s awareness. The only relevant documents submitted are: (1)

four pages of poorly photocopied checks drawn on Karen’s account (with four

checks highlighted totaling $1300); (2) the ownership information for the joint

savings account; (3) a December 2010 savings account statement; (4) six savings

account deposit slips totaling $2400 in deposits; (5) a savings account withdrawal

slip in the amount of $2412.37 closing the account; (4) a December 2015 savings

account statement showing the closing withdrawal; (5) a deposit slip showing three

amounts deposited into a checking account with the names of J.R., S.R., and F.R.

handwritten in the column indicating the source of the funds ($2412.37 from J.R.);

and (6) the paperwork for S.R.’s 529 account showing an initial deposit of $5200.

      Neither party has established entitlement to dismissal or summary judgment

on the conversion claim. Reading the petition in the light most favorable to J.R.,

we cannot conclude her claim could not be sustained under any state of facts

provable under the petition. Dismissal was not appropriate. On the other hand,

the facts presented establish, at least minimally, the existence of a disputed

material fact regarding the nature of Karen’s gifts to J.R. Summary judgment was

not appropriate.

      Accordingly, we reverse the district court order granting defendants’ motion

to dismiss, affirm the denial of J.R.’s motion for summary judgment, and remand

for further proceedings.

      Although both parties request an award of appellate attorney fees, neither

cites authority for such an award. We therefore decline to make an award of

appellate attorney fees. See Hockenberg Equip. Co. v. Hockenberg’s Equip. &
                                        8

Supply Co. of Des Moines, 510 N.W.2d 153, 158 (Iowa 1993) (“A party generally

has no claim for attorney fees as damages in the absence of a statutory or written

contractual provision allowing such an award.”).

      AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.