Douglas Visser v. Auto Alley, LLC , 162 Idaho 1 ( 2017 )


Menu:
  •                  IN THE SUPREME COURT OF THE STATE OF IDAHO
    Docket No. 43432
    DOUGLAS VISSER, a married man as to his )
    sole and separate property,               )
    )                   Boise, January 2017 Term
    Plaintiff-Respondent,              )
    )                   2017 Opinion No. 14
    v.                                        )
    )                   Filed: February 24, 2017
    AUTO ALLEY, LLC, an Idaho limited         )
    liability company, CALVIN VISSER and      )                   Stephen Kenyon, Clerk
    VICKI VISSER, as individuals and in their )
    capacity as Members and/or Managers of    )
    Auto Alley, LLC,                          )
    )
    Defendants-Appellants.             )
    Appeal from the District Court of the First Judicial District of the State of Idaho,
    Bonner County. Hon. Barbara A. Buchanan, District Judge.
    The judgment of the district court is affirmed.
    Berg & McLaughlin, Chtd., Sandpoint, for appellants. Toby McLaughlin argued.
    Featherston Law Firm, Chtd., Sandpoint, for respondent. Brent Featherston
    argued.
    _______________________________________________
    HORTON, Justice.
    Auto Alley, LLC, Calvin Visser, and Vicki Visser appeal from the Bonner County district
    court’s order granting a writ of possession and quieting title to certain real property in Douglas
    Visser. Douglas was awarded the property in his divorce from Vicki in 2005. A dispute
    subsequently arose and in February of 2014, the parties entered into a stipulation that resulted in
    Vicki being permitted to continue to occupy part of the property known as “Lot 2.” A stipulated
    judgment was entered which provided that Douglas would convey Lot 2 to Vicki if she
    completely performed a number of specific obligations within specified time frames. When
    Vicki failed to completely perform those obligations, Douglas brought the instant motion to
    enforce the judgment and the district court granted his motion. Vicki timely appealed. We affirm
    and award Douglas attorney fees on appeal.
    1
    I. FACTUAL AND PROCEDURAL BACKGROUND
    Douglas and Vicki were divorced in 2005. As part of that divorce, Douglas was awarded
    the real property in dispute in this action. The property had been used as a wrecking yard. The
    property was encumbered by a promissory note and deed of trust from Douglas and Vicki to
    Joseph Lapham in the amount of $111,500 (the Lapham debt). In 2006, Calvin Visser, Douglas’s
    son, rented a portion of the property from Douglas to run a wrecking yard. Instead of paying rent,
    Douglas and Calvin agreed that Calvin would pay the monthly payments on the Lapham debt
    and the property taxes.
    In 2007, Vicki moved back to Ponderay and began to operate the wrecking yard with
    Calvin. Calvin and Vicki operated the wrecking yard as Auto Alley, LLC. In 2013, Douglas
    learned that the property taxes were several years in arrears and that the county had plans to take
    the property by tax deed. $52,807.52 was due on taxes for 2009–2012. Douglas paid $14,591.74
    to prevent the property from being sold. Douglas also learned that the Lapham debt had
    increased from $111,500 to nearly $300,000. Douglas filed an action for breach of contract and
    waste in 2013 for Vicki’s failure to make payments on the Lapham debt and pay the taxes. The
    district court entered a temporary restraining order on July 3, 2013. At an Order to Show Cause
    hearing held on July 24, 2013, the parties stipulated to continuing the Temporary Restraining
    Order and enter into mediation.
    On February 18, 2014, the parties submitted a Stipulated Judgment to the district court.
    The Stipulated Judgment was entered by the district court on February 19, 2014. The Stipulated
    Judgment allowed for the property to be split into two lots and for Vicki to obtain title to Lot 2
    upon her fulfillment of certain obligations. The Stipulated Judgment required Vicki to pay half of
    the Lapham debt, remove all of her property from Lot 1, and commission an environmental study
    of Lot 1. Douglas was required to convey Lot 2 to Vicki “ONLY upon condition that
    [Vicki]…fully and completely perform all of the obligation as set forth hereafter.” (emphasis in
    original). The Stipulated Judgment also provided, “[i]f [Vicki] fail[s] and/or refuse[s] to make
    payments as set forth in the preceding section, [Vicki] must immediately vacate the premises
    described in Exhibit “A” immediately and [Douglas] shall have an immediate Writ of Possession
    from this Court as set forth above.”
    Almost immediately, Vicki failed to comply with the terms of the Stipulated Judgment
    and Douglas filed a Motion for Writ of Possession and Judgment for Quiet Title on April 3,
    2
    2014. The district court denied the motion, finding that Vicki had substantially complied with the
    terms of the Stipulated Judgment. On May 7, 2014, Vicki filed a motion claiming that Douglas
    had interfered with her ability to comply with the Stipulated Judgment. Following a hearing, the
    district court declined to grant the motion. In March of 2015, Vicki filed a motion for contempt
    and Douglas filed a second motion seeking a writ of possession and quiet title. Following a
    hearing on both motions, the district court issued its memorandum opinion and order granting
    Douglas’s motion and denying Vicki’s. In its decision, the district court found that Vicki had
    failed to comply with the terms of the Stipulated Judgment and Douglas was entitled to a Writ of
    Possession as well as an order quieting title in the property. The district court denied Vicki’s
    contempt motion, finding that Douglas was not in contempt for failing to convey the deed to Lot
    2 to Vicki prior to her completion of the terms of the Stipulated Judgment.
    Vicki then filed a motion to reconsider. Vicki argued that the forfeiture of the property
    constituted an illegal penalty and that Douglas had prevented Vicki from fulfilling her
    obligations under the Stipulated Judgment. After a hearing, the district court denied Vicki’s
    motion to reconsider and entered judgment in favor of Douglas. Vicki timely appealed.
    II. STANDARD OF REVIEW
    “The general rule is that a stipulated judgment is not subject to appellate review.” Fagen,
    Inc. v. Rogerson Flats Wind Park, LLC, 
    159 Idaho 624
    , 627, 
    364 P.3d 1189
    , 1192 (2016). “There
    is an exception to the general rule where the appellant(s) did not actually consent to the
    judgment, or the trial court lacked subject matter jurisdiction, or the judgment was obtained by
    fraud, or the judgment adversely affects the public interest.” 
    Id.
    “A trial court’s findings of fact will not be set aside on appeal unless they are clearly
    erroneous.” Pinnacle Engineers, Inc. v. Heron Brook, LLC, 
    139 Idaho 756
    , 758, 
    86 P.3d 470
    ,
    472 (2004). “On appeal this Court examines the record to see if challenged findings of fact are
    supported by substantial and competent evidence.” 
    Id.
     “Evidence is regarded as substantial if a
    reasonable trier of fact would accept it and rely upon it in determining whether a disputed point
    of fact has been proven.” 
    Id.
    III. ANALYSIS
    Vicki raises two substantive issues on appeal. First, Vicki argues that the forfeiture
    provision contained within the Stipulated Judgment constitutes an unenforceable penalty and the
    3
    district court erred in enforcing it. Vicki next argues that Douglas interfered with her ability to
    comply with the judgment. These issues will be addressed in turn.
    A. Whether the forfeiture provision constituted an unenforceable penalty is not properly
    before this Court.
    Vicki’s first argument is that the Stipulated Judgment contains an unenforceable penalty
    provision and the district court erred in enforcing it. Vicki premises this argument on the belief
    that a Stipulated Judgment is a contract. In support of this premise, Vicki cites to Jim & Maryann
    Plane Family Trust v. Skinner, 
    157 Idaho 927
    , 
    342 P.3d 639
     (2015), where this Court said
    “[s]ince a stipulation is a contract, its enforceability is determined through contract principles.”
    Skinner, 157 Idaho at 933, 342 P.3d at 646. There, we were considering the proper way to
    interpret the language of the stipulation. Id. Similarly in Guzman v. Piercy, 
    155 Idaho 928
    , 
    318 P.3d 918
     (2013), this Court again applied contract principles to ascertain the meaning of
    language in a stipulation. Guzman, 157 Idaho at 936, 318 P.3d at 926.
    Here, Vicki is asserting that the Stipulated Judgment is unenforceable. While Vicki
    makes this assertion, she has not sought relief from the Stipulated Judgment nor has she appealed
    that judgment. Generally, judgments must be appealed within 42 days from the time they were
    entered. I.R.C.P. 83(b)(1)(A). However this Court recently stated that stipulated judgments are
    not subject to appellate review. Fagen, Inc., 159 Idaho at 627, 364 P.3d at 1192.
    The general rule is that a stipulated judgment is not subject to appellate review.
    There is an exception to the general rule where the appellant(s) did not actually
    consent to the judgment, or the trial court lacked subject matter jurisdiction, or the
    judgment was obtained by fraud, or the judgment adversely affects the public
    interest.
    Id. (internal citations omitted).
    In Fagen, the Defendants had stipulated that they were liable on a breach of contract
    claim but reserved the right to argue damages. Id. at 626, 364 P.3d at 1191. At the hearing on
    damages, the Defendants attempted to assert affirmative defenses that would shield them from
    liability. Id. When the district court refused to let Defendants argue the issue of liability, they
    appealed. Id. at 627, 364 P.3d at 1192. On appeal, this Court noted that unless the Defendants
    could show one of the exceptions listed above that the stipulated judgment was not subject to
    appellate review. Id. Once the Court found none of the exceptions applied they did not address
    any of the substantive issues raised on appeal. Id. “[W]e will not address the substantive issues
    4
    raised by Defendants on appeal. They simply seek on appeal to set aside the judgment to which
    they stipulated.” Id.
    The facts of this case are similar to the facts in Fagen. Like the Defendants in Fagen,
    Vicki entered into a stipulated judgment and now seeks to challenge its enforceability. Vicki has
    not alleged that she did not consent to the judgment or that it was obtained by fraud. Vicki has
    not argued that the district court lacked subject matter jurisdiction or that the judgment affects
    the public interest. Because there are no facts in the record that would suggest any of the
    exceptions apply, we will not consider Vicki’s claim that the judgment contained an improper
    forfeiture provision.
    Although we do not wish to dissuade parties from entering into stipulated judgments in
    order to resolve their disputes, this case should be viewed by attorneys as a cautionary tale.
    Practitioners must take particular care when advising clients who consider entering into a
    stipulated judgment. Attorneys and their clients should be aware that a stipulated judgment may
    be attacked only on limited grounds, unlike a settlement agreement, which is treated as a new
    contract, Mihalka v. Shepherd, 
    145 Idaho 547
    , 550–51, 
    181 P.3d 473
    , 476–77 (2008), and
    therefore subject to traditional contract defenses.
    B. Did Douglas prevent Vicki from complying with the judgment?
    Vicki also argues that Douglas interfered with her ability to comply with the judgment
    when he failed to convey Lot 2 to her. Vicki supports this argument by arguing that every
    contract contains a duty of good faith and fair dealing and that Douglas breached this duty when
    he failed to convey Lot 2 to Vicki so she could refinance her share of the Lapham debt using Lot
    2 as collateral. The district court found that because Vicki had not fully satisfied her obligations
    under the Stipulated Judgment, Douglas had no duty to convey the deed to Lot 2 to her. The
    district court was correct.
    The Stipulated Judgment provides, “Plaintiff, Douglas Visser, will convey to the
    Defendant, Vicki Visser, that portion of the real property…designated as Lot 2 consisting of 6.2
    acres ONLY upon condition that Defendants, and each of them, fully and completely perform all
    the obligations set forth hereafter.” (emphasis in original). The Stipulated Judgment then
    identifies the conditions that Vicki was required to satisfy in order to receive the property. One
    of those conditions was that Vicki pay her half of the Lapham debt on or before June 30, 2014. It
    is undisputed that Vicki did not pay her half of the Lapham debt on or before June 30, 2014, as
    5
    required by the Stipulated Judgment. Because the Stipulated Judgment specifically provided that
    Douglas’s duty to convey Lot 2 would arise only upon Vicki’s performance of all her
    obligations, the district court’s determination that Douglas did not interfere with Vicki’s ability
    to comply with the Stipulated Judgment is supported by substantial and competent evidence.
    C. Attorney fees on appeal.
    Both parties request attorney fees and costs on appeal. Because Vicki is not the prevailing
    party on appeal, she is not entitled to attorney fees and costs. The Stipulated Judgment provides:
    “In the event of any action to enforce the terms of this Judgment, the prevailing party shall be
    entitled to a reasonable reimbursement of fees and costs payable by the non-prevailing party.” As
    the prevailing party, Douglas is entitled to attorney fees under the Stipulated Judgment.
    IV. CONCLUSION
    We affirm the judgment of the district court and award attorney fees and costs on appeal
    to Douglas.
    Chief Justice BURDICK and Justices EISMANN, JONES and BRODY, CONCUR.
    6
    

Document Info

Docket Number: 43432

Citation Numbers: 162 Idaho 1, 393 P.3d 1027

Filed Date: 2/24/2017

Precedential Status: Precedential

Modified Date: 1/12/2023