Court Opinion

ID: 9558028
Source: CourtListenerOpinion
Date Created: 2023-08-21 17:01:53.81008+00
Date Added: 2024-06-11T09:08:06.393648
License: Public Domain

McCLINTOCK, Justice
(dissenting). I do not disagree with the majority of the court that plaintiff may have been entitled to some relief in this case. However, I think that neither the trial judge nor the majority are clear as to the manner in which the two deeds should be reformed. Affirmance of this vague order can only *1145result in a perversion of legal processes. I have no wish to revert to the ritualistic shackles of common-law pleading and remedies and am as ready as the majority to accept the equitable principle of reformation as a well-established remedy in the jurisprudence of this state. I simply believe that it is without pertinence to this action.
I agree that under certain circumstances an oral agreement can be taken out of the scope of the Statute of Frauds but am concerned that the factual situation basic to such exception may not have been developed in the evidence and certainly the facts of this case were not considered by the trial court upon principles applicable thereto. I would therefore reverse the judgment and remand the proceedings to the trial court with directions to take further evidence as necessary to make a factual determination if there is justification for entry of a decree of specific performance under principles enunciated by this court.
It puzzles me that the majority opinion at some length discusses the effect of partial performance upon the validity and enforceability of an oral contract which would otherwise be within the prohibitions of the Statute of Frauds, says nothing about the principles of reformation, and yet concludes: “The trial court properly allowed reformation of the conveyance to conform to the intention of the parties.” The complaint sought no reformation of the deeds, made no allegation that through fraud or mistake they did not effectuate the actual agreements of the parties and the prayer was only for a declaration as to the validity of the oral agreement that the properties would be reconveyed into separate ownership after the jointly-held title had served the purpose of providing acceptable security as desired by the Farmers Home Administration. In North American Uranium, Inc. v. Johnston, 77 Wyo. 332, 349, 316 P.2d 325, 331 (1957), this court conceded the validity of argument that it could be shown through parol that an agreement was entered into through fraud or mistake, and said:
“ * * * But that was not made an issue in this case, and we cannot say that the parties voluntarily enlarged the issue. In fact the contrary appears. Fraud and mistake must not alone be proven, but must also be pleaded if the parol evidence rule is not to apply.”
The pretrial memoranda and order disclose no issue as to reformation and during the course of the trial there are continuing indications that plaintiff’s counsel was relying on an oral agreement plus partial performance to justify his action. Notwithstanding the continued absence of any claim of mistake, the judgment vaguely refers to “the mistake as to the effect of the deeds.”1 The trial court’s reformation of the deeds to incorporate therein language that “defendants’ interest in plaintiff’s lands and premises is a security interest only” appears to me to be completely meaningless. Under the clear terms of the agreement the security interest was in the Farmers Home Administration and I find nothing indicating that there was to be any security interest as between the parties. However reformation crept into the case, I am convinced that it was not applicable and should not be the basis of relief.
More importantly, however, it is my understanding of the law of reformation that this salutary remedy is afforded only in situations where through fraud, mistake, *1146or other inadvertence the instrument as drawn does not correctly express what was clearly and intentionally agreed upon by the parties to the instrument.2 I find nothing in this record to indicate that the parties to these deeds intended for them to state anything but exactly what was contained therein. They intended to satisfy a requirement of the FHA that property held in joint tenancy be mortgaged as security for the loan. By their deeds they effectively created that estate. As agreed upon by them it was only at some future time and after the joint estate had served its purpose as such security that separate estates were to be revested in the original and separate owners. I therefore must ask why this court should attempt the torturous and tortuous process of changing these plain deeds into something they were not? 3
While I agree that evidence as to this supplemental or side agreement was not received in violation of the parol evidence rule, I do not agree that the courts merely give lip service to the rule. See Johnson v. Soulis, Wyo., 542 P.2d 867, 873 (1975). It is an important rule. Conceding that, as stated by Corbin4 “the rule is so variable in its operation as to be the despair of law teachers and writers,” it is nevertheless frequently applied by courts, and I believe that it has a well-established place in our jurisprudence and deserves no denigration at our hands. I do not think that my Brothers of the majority would despair or hesitate to apply it in many and varied situations. To recognize that it is subject to exceptions is not to deny its general merit. In the proper case I think that an exception is to be considered.
However, I would not rely upon the doctrine of judicial estoppel to avoid that rule. Without attempting an exhaustive examination of the subject, I note that the opening paragraph on the subject in 31 C.J.S. Estoppel § 1, p. 288, in large measure predicates application of this principle on the act of one person which has induced another person to take some action by which he will be prejudiced unless the first person is held bound by his act. One may not mislead another and then repudiate his own act to the latter’s injury. In Gay Johnson’s Wyoming Automotive Service Co., Inc. v. City of Cheyenne, Wyo., 367 P.2d 787, 788 (1961) it was said:
“Even the interveners recognize that the defense of estoppel is available only where the actions of a plaintiff have operated to the prejudice of a defendant.” (Emphasis added)
Similarly, without any claim to complete knowledge on the subject, I find in 31 C.J.S. Estoppel § 117, p. 60 et seq. numerous indications that judicial estoppel, *1147treated as a form of equitable estoppel, is applied only in case of prejudice. Id. p. 618.
I do not venture to say that testimony in court may not in some cases be accepted in a subsequent hearing as preventing a change of testimony, but in this case, even if we admit that there may be an 'estoppel against the younger Allen, preventing him from denying the truth of his testimony in the divorce case between himself and his wife, also a party to this action, and which estoppel was effective as to nonparties to that action, such estoppel might only prevent him denying the truth of his former testimony. Under the recognized principle that the parol evidence rule is one of substantive law, permitting reliance upon the rule even though the evidence was received without objection, North American Uranium, Inc. v. Johnston, supra, 77 Wyo. at 348, 316 P.2d at 330, I think it could still be claimed that the estoppel was ineffective to establish the legal validity of the oral agreement.
I consider the evidence admissible and probative under Bachmann v. Hurtt, 26 Wyo. 332, 184 P. 709 (1919), cited by appel-lee for the proposition that parol evidence is admissible to show a separate oral agreement on a subject not included in or disclosed by the writing, and not inconsistent with its terms. See also Parkinson v. Roberts, 78 Wyo. 478, 487, 329 P.2d 823, 826 (1958). As previously said in my analysis of the transaction, the parties intended what they said in the deeds but the deeds were not intended as the full integration of their agreement. The testimony given does not contradict or vary the deeds; it goes on to establish an additional agreement. I think that it was competent and the only question to me is, then, the application of the Statute of Frauds.5
While I have not agreed with my Brother Rose in his dissent as to the applicability of the parol evidence rule, I most heartily endorse his objection to that paragraph of the majority opinion beginning with the sentence, “We are not a bit concerned that the matter of judicial estoppel was not raised in the lower court or argued by either of the parties.”
In Crosby v. Strahan, 78 Wyo. 302, 314, 324 P.2d 492, 496 (1958) this court, while refusing to find that the facts of that case took it out of the Statute of Frauds, pointed out with quotation from strong authority that “a mere failure or refusal to carry out an oral contract within the statute of frauds does not take the case out of that statute,” so that a showing of more than nonperformance was necessary.
“ * * * The doctrine of estoppel in pais [6] is to prevent injury arising from actions or declarations which have been acted on in good faith and which it would be inequitable to permit the party to retract. * * * Not every trivial injury will invoke the doctrine of estoppel.
*1148The promisee of an oral contract, in order to be able to rely on the doctrine of estoppel, must be able to show that he has changed his position substantially for the worse and that he has incurred unjust and unconscionable injury and loss.” 78 Wyo. at 316, 324 P.2d at 497.
This court further quoted with apparent approval from Bennett v. Harrison, 115 Minn. 342, 132 N.W. 309, 311, 37 L.R.A. N.S., 521 in pertinent part as follows (78 Wyo. at 319, 324 P.2d at 499):
* * * The mere denial of the right promised by the oral agreement, the loss of that which existed only by virtue of the oral promise, being deprived of the bargain, does not create an exceptional situation as to the statute, but the very situation the statute covers. To take a case out of the statute because of such resulting loss or injury annuls the statute. The injury or loss which would result from the enforcement of the statute must arise from the acts done in performance or in pursuance of the oral agreement, and such acts must so far alter the situation of the parties seeking to avoid the statute that it would be unjust and against conscience to allow the other party, who has permitted such change to take place in pursuance of his oral agreement, to thereafter refuse to perform on his part.’ ” (Emphasis added)
In the earlier case of Johnson v. Maki, 45 Wyo. 113, 118, 16 P.2d 46, 48 (1932) this court had no difficulty in enforcing an oral contract for the purchase of real property where the purchaser had paid the consideration therefor and moved into possession thereof, the fact of possession being accompanied by payment of rental by the deceased vendor to his vendee. But it was there said that “The possession required is one that is exclusive of and not shared by the vendor.” By payment of rent the vendor “virtually acknowledged plaintiff to be the owner of the property, and his possession as tenant was the possession of the plaintiff.” In Butler v. McGee, Wyo., 373 P.2d 595, 597-598 (1962) this court adhered to the rule of Johnson but continued :
“However, in order for the possession to be sufficient as a part performance of an oral contract, the acts constituting performance must be referable solely to the contract sought to be enforced, and not such as might have been referable to some other or different contract.”
In the case at Bar it is fairly clear that to some extent at least the plaintiff continued in possession of the premises after they were transferred into joint tenancy, but such possession may be completely consistent with the joint tenancy and we therefore have an ambiguity in this case that was not present in Johnson. At least until after the action was filed plaintiff paid the taxes on the River Place. His son paid the taxes on the Haptonstall Place and made all of the mortgage payments. The son testified that both parties owned cattle and that he ran some of his cattle on the River Place. It is not clear whether livestock of the plaintiff were run on the Haptonstall Place. The son apparently took care of the cattle of both parties, this service being rendered, as he testified, “for what he [the father] called rent on the place down there.” Perhaps this indicates payment of rental within the purview of Johnson and such payment would be consistent with the plaintiff’s theory that the properties were treated as equitably or contractually the separate and distinct properties of the two men.
Partially digressing for a moment, it seems to be well established that in those instances where one has paid part of the consideration for the purchase of realty, found to be unenforceable by reason of the Statute of Frauds, any consideration that he has paid is refundable.7 Otherwise the *1149party refusing performance would not only have his property but would have the money which the purchaser has paid and this is considered unconscionable. If the money is repaid, all that the promisee has lost is the benefit of his bargain. But we must ask ourselves in this case, how could rescission be effected or retribution be made so that notwithstanding the refusal of the son to perform his part of the agreement, the parties can be restored to their original status? The answer that occurs to me is that the only way the parties can be placed in their original position is by restoration of their separate properties which is in effect specific performance of the agreement to reconvey. This, then, is not a case of a mere loss of the benefit of the bargain. Within the language of Bennett, supra, as quoted in Strahan, supra, a substantial injury would arise from acts done in performance of the agreement, and plaintiff has so far altered his situation that it would be unjust and against conscience to allow the son, who has permitted the change to take place, to refuse to perform on his part.
Under such circumstances, it occurs to me that the refusal of the promissors to carry out their promise, even though it is a refusal some appreciable time after the agreement could have been made without fraudulent intent then present, does to all practical intents and purposes result in a fraud upon the plaintiff. I can conceive of no equity in permitting the son and daughter-in-law to retain a two-thirds interest in some 440 acres of land with the father only having a one-third interest in 230 acres. Assuming that the lands are roughly equivalent in value per acre, the father would have given up a substantial portion of his property for no other reason than that he wanted to help out a son. If this case is not one for specific performance, I would have a difficult time finding one more suitable.
Under this view of the case, and had the district court entered an order for specific performance on a general finding in favor of the father, I would have little difficulty in affirming the judgment. Relief can be given without warping the principles of reformation, the pertinence of which principle I deny ánd which the majority does not consider. I certainly feel that application of the principle of estoppel to assert the statute would prevent an unconscionable situation. But since the trial court has disposed of the matter on a theory of reformation, finding that the parties intended to do something with their deeds that was not expressed therein, I do not believe that the case is in proper position for affirmance by this court. The factual situation may or may not have been fully developed and there are enough uncertainties therein that I think the case should be remanded to the district court with instructions to take evidence on the manner in which the farms have been held in possession and operated and under the principles which we have enunciated enter a decree granting or denying specific performance of the agreement to reconvey.

. After finding that the parties intended that part of the jointly-held land was “to revert and again be the sole property of the plaintiff” and that the other part “would be the sole property of the defendants” the court further found “that by reason of the original intention and representations of the parties, the mistake as to the effect thereof, and the subsequent conduct of the defendants, the warranty deeds heretofore mentioned should be reformed so as to provide that defendants’ interest in plaintiff’s lands and premises is a security interest only and that plaintiff’s interest in the lands purchased by defendants was, and is a security interest only.” The emphasized portion of this quotation represents the only reference by the court to any mistake.

. See Stoll v. Nagle, 15 Wyo. 86, 86 P. 26 (1906), and Grieve v. Grieve, 15 Wyo. 358, 89 P. 569 (1907), in both of which reformation was refused, and Russell v. Curran, 66 Wyo. 173, 195, 206 P.2d 1159, 1167 (1949), where it was said that the parol testimony and documentary evidence “require[d] a conclusion that the evidence for the plaintiff in the District Court was clear, satisfactory, and convincing that through mutual mistake the sale contract involved herein did not include the furniture in the house as it should have done and a reformation of the contract was properly ordered by that court.” (Emphasis added) See Pfister v. Brown, Wyo., 498 P.2d 1243 (1972) for our most recent affirmation of the principles set forth in Stoll and Grieve as governing reformation.

. I am not concerned that the instrument itself be physically reformed to include whatever words the majority feel must be inserted therein to carry out the intended but unexpressed provisions of the agreement, but am deeply concerned that they accept the very fuzzy declaration of the trial court. In Russel v. Curran, 66 Wyo. 173, 186, 206 P.2d 1159, 1163 (1949), the judgment of the trial court was specific that the contract “ ‘be amended by inserting following the words * * * . ’ ” I for one have been unable to determine what language should have been inserted in the deeds that was not, and I think that consideration of the case along those lines would have convinced the majority that the case was not one for reformation.

. 3 Corbin on Contracts, 1951, § 589, p. 329, quoted in North American Uranium, Inc. v. Johnston, 77 Wyo. 332, 316 P.2d 325 (1957).

. In considering our Statute of Frauds, I cannot agree with the majority that only the First clause (contract not to be performed within one year) is applicable. I think that the transaction is a sale of property within the Fifth clause of the statute and do not consider Mecum v. Metz, 30 Wyo. 495, 503, 222 P. 574, 576, reh. den. 32 Wyo. 79, 229 P. 1105 (1924) as authority that it is not. I prefer to refer to donada v. Ihmsen, 33 Wyo. 439, 446, 240 P. 927, 929, 43 A.L.R. 1010 (1925) where without citation of Meeum this court said: “A will is considered in the nature of a conveyance by way of appointment. A devisee comes within the legal definition of one who takes by purchase, and the courts are nearly unanimous in holding, under statutes such as we have in this state, that an agreement to devise real property is within the statute of frauds and must be in writing.” The Fifth clause had been specifically raised as a bar to the action.

6. The pleadings, pretrial memoranda, and pretrial order do little in this case to disclose the exact theories involved. It has been said by this court that estoppel should be specially pleaded. Sturgeon v. Brooks, 73 Wyo. 436, 281 P.2d 675 (1955); McCarthy v. Union Pacific Ry. Co., 58 Wyo. 308, 131 P.2d 326 (1942). Rule 8(c), W.R.C.P. requires that it be pleaded where it is raised as a defense. I am bothered by this and feel that it would have been desirable to have a much more careful delineation of the issues.

. “Payments made under a contract unenforceable by reason of the statute of frauds may be recovered back where the other party sets up the statute and declines to perform or where the contract is mutually abandoned.” 37 C.J.S. Statute of Frauds § 256, p. 778 (black type).